Butler Motors, d/b/a Butler Toyota, Butler Toyota Inc., and Butler Scion, et al. v. Michael Benosky, et al.Butler Motors, d/b/a Butler Toyota, Butler Toyota Inc., and Butler Scion, et al. v. Michael Benosky, et al.
Michael P. Shanahan
William N. Ivers
Geoffrey Grodner
Indiana Dealer Counsel Mallor /
Grodner LLP
Indianapolis, Indiana
Thomas A. Barnard
Jeffrey D. Stemerick
Taft Stettinius & Hollister LLP
Indianapolis, Indiana
Wayne C. Turner
Kenneth J. Munson
Hoover Hull Turner LLP
Indianapolis, Indiana
Sean Burke
Hamish S. Cohen
Ray Biederman
Mattingly Burke Cohen & Biederman
LLP
Indianapolis, Indiana
Donn H. Wray
Glenn Bowman
Stoll Keenon Ogden PLLC
Indianapolis, Indiana
Karl L. Mulvaney
Margaret M. Christensen
S. Katherine Dickey
Dentons Bingham Greenebaum, LLP
Indianapolis, Indiana
ATTORNEYS FOR APPELLEES
Irwin B. Levin
Richard E. Shevitz
Vess A. Miller
Lynn A. Toops
Cohen & Malad, LLP
Indianapolis, Indiana
John J. Morse
Michael N. Red, Jr.
Rebekah L. Phillips
Morse & Bickel, P.C.
Indianapolis, Indiana
Deborah J. Caruso
Joshua W. Casselman
Rubin & Levin, PC
Indianapolis, Indiana
Duran L. Keller
Keller Law
Lafayette, Indiana
Statement of the Case
[1] This interlocutory appeal involves fourteen separate class action causes that were consolidated for pre-trial purposes into one cause in the Indiana Commercial Court in Marion County (“the trial court“). A group of consumers, who had purchased automobiles from various automobile dealers, filed class action complaints against the automobile dealers, who then filed
[2] We affirm.
Issue
Whether the trial court erred by denying the
Facts1
[3] This appeal arrives in this Court from two interlocutory orders ruling on two consolidated motions to dismiss. Specifically, the trial court denied a
[4] This appeal ultimately stems from the charging of those Doc Fees, and it involves the Deceptive Consumer Sales Act (“DCSA“) under
[5] The Deceptive Acts Statute of the DCSA provides, in relevant part, that “[a] supplier may not commit an unfair, abusive, or deceptive act, omission, or practice in connection with a consumer transaction” and that such conduct is “a violation of [the DCSA] whether it occurs before, during, or after the transaction.”4
[6] On the other hand, the MVDSA is enforced by the Indiana Secretary of State. See
It is an unfair practice for a dealer to require a purchaser of a motor vehicle as a condition of the sale and delivery of the motor vehicle to pay a document preparation fee, unless the fee:
(1) reflects expenses actually incurred for the preparation of documents;
(2) was affirmatively disclosed by the dealer;
(3) was negotiated by the dealer and the purchaser;
(5) is set forth on a buyer‘s order or similar agreement by means other than preprinting.
[7] The filings of the class action complaints in this appeal were preceded and seemingly precipitated by an opinion handed down by this Court. On March 6, 2019, this Court handed down Gasbi LLC v. Sanders, 120 N.E.3d 614 (Ind. Ct. App. 2019), trans. denied, which addressed a motion to dismiss a consumers’ class action complaint that raised a claim under the DCSA. Specifically, the consumers’ claim was brought under
[8] The dealer in Gasbi argued that the consumers’ complaint should be dismissed pursuant to
[9] On appeal, this Court held that the dealer was not entitled to dismissal based on its argument that the consumers had failed to state a claim for relief under one of the specifically enumerated categories of deceptive acts contained in
[10] Additionally, this Court held that dismissal of the consumers’ complaint was not justified based on the dealer‘s argument that consumers did not have a private right of action under the MVDSA Doc Fee statute,
[11] The following month, in April 2019, some of the Consumers6 in this case filed their initial class action complaints, alleging violations of the DCSA based on the charging of Doc Fees. The next month, in May 2019, the legislature amended
[12] The amendment to MVDSA Doc Fee Statute provided as follows:
(a) Except as provided in subsection (b), it is an unfair practice for a dealer to charge a document preparation fee in excess of two hundred dollars ($200). A document preparation fee under this section must be:
(1) included in the advertised sale price of a vehicle; and
(A) in writing by the dealer during negotiations for the sale of a vehicle to a potential purchaser that states the dollar amount of the document preparation fee to be charged; and
(B) as a separate line item on the purchaser‘s bill of sale or other purchase contract.
(b) A document preparation fee under this section may be adjusted annually by a percentage equal to the annual percentage change in the Consumer Price Index, as published by the United States Bureau of Labor Statistics.
[13] Following the enactment of the 2019 Doc Fee Amendment, those Consumers who had previously filed their complaints then filed amended class action complaints, and the remaining Consumers filed their class action complaints. It
[14] In their class action complaints, Consumers raised three claims: (1) a violation of the DCSA; (2) constructive fraud; and (3) unjust enrichment. All these claims were based on the Consumers’ allegation that, between 2013 and 2020, Dealers had charged a Doc Fee that was contrary to the MVDSA Doc Fee Statute,
[15] The Consumers’ complaints that included Alter Ego Dealers as defendants also alleged that these Alter Ego Dealers “operated as alter egos and as a single business enterprise with respect to the charging of unlawful [Doc Fees].” (App. Vol. 3 at 120; Appellees’ App. Vol. 2 at 24; Appellees’ App. Vol. 2 at 49; Appellees’ App. Vol. 2 at 87; Appellees’ App. Vol. 2 at 107; Appellees’ App. Vol. 2 at 129; Appellees’ App. Vol. 2 at 172; Appellees’ App. Vol. 3 at 7; Appellees’ App. Vol. 3 at 46). Additionally, Consumers alleged that the Alter Ego Dealers “share[d] similar corporate names; share[d] overlapping officers, directors, and employees; ha[d] similar business purposes; share[d] certain offices; advertise[d] together as a single unit on their website . . . ; and . . . generally operated in an interconnected and controlled way, such that [they] c[ould] be considered a single unit for liability purposes.” (App. Vol. 3 at 120; Appellees’ App. Vol. 2 at 24-25; Appellees’ App. Vol. 2 at 49-50; Appellees’ App. Vol. 2 at 87; Appellees’ App. Vol. 2 at 107; Appellees’ App. Vol. 2 at 129; Appellees’ App. Vol. 2 at 172-73; Appellees’ App. Vol. 3 at 7-8; Appellees’ App. Vol. 3 at 46-47). Alternatively, these Consumers alleged that the Alter Ego Dealers had “conspired and colluded to do the acts alleged in th[e] complaint and, as a result, each [wa]s jointly and severally liable for the damages resulting for that civil conspiracy.” (App. Vol. 3 at 120; Appellees’ App. Vol. 2 at 25; Appellees’ App. Vol. 2 at 50; Appellees’ App. Vol. 2 at 87;
[16] On March 2, 2020, Consumers filed, pursuant to
[17] On March 30, 2020, Dealers filed a consolidated motion to dismiss (“Consolidated MTD“) and Alter Ego Dealers filed a combined motion to dismiss (“Alter Ego MTD“). They filed their motions under
[18] Alter Ego Dealers argued that Consumers’ claims against them should be dismissed because they had not charged a Doc Fee to any of the Consumers since their names were not on the sales contracts. Alter Ego Dealers asserted that Consumers “lack[ed] standing to pursue claims against the Alter Ego D[ealers] who [ha]d not charge[d] or collect[ed] a Doc Fee to or from the [Consumers]” and that Consumers’ complaints “were not sufficient to establish alter ego liability.” (App. Vol. 3 at 172, 178).
[19] In response to the Alter Ego MTD, Consumers argued, in part, that the trial court should deny the motion because the question of whether the Alter Ego Dealers were alter egos of Dealers was a fact-sensitive inquiry and not appropriate to decide at the motion to dismiss stage, where all the allegations in Consumers’ complaints were to be taken as true. Consumers also argued that they had standing because their complaints had alleged that all defendant groups were single entities that had charged unlawful Doc Fees and had caused damages. Consumers alternatively argued that their claims against the Alter Ego Dealers should not be dismissed for lack of standing because of the juridical link doctrine.
[20] In Dealers’ Consolidated MTD, they made multiple arguments regarding why they believed that Consumers’ three claims should be dismissed. The majority of their arguments focused on Consumers’ DCSA claim. For example, Dealers argued that the trial court should dismiss Consumers’ DCSA claims because Consumers did not have a private right of action under the MVDSA. Dealers acknowledged that the Gasbi decision provided that a consumer could raise a claim under the DCSA by alleging that a dealer had violated the MVDSA Doc Fee statute. Dealers, however, argued that Gasbi predated the 2019 Doc Fee Amendment and applied only to the pre-amendment version of the Doc Fee Statute.
[21] In response to this argument, Consumers acknowledged that there was not a private right of action under the MVDSA, but they asserted that they were not bringing a claim under the MVDSA. Instead, Consumers were alleging
[22] Dealers’ primary argument in their Consolidated MTD was that Consumers’ DCSA claims, which were based on a violation of the MVDSA Doc Fee statute, should be dismissed because the 2019 Doc Fee Amendment should be applied retroactively. Dealers asserted that the 2019 Doc Fee Amendment expressly permitted a Doc Fee under $200, which they asserted made the Doc Fees that the Dealers had charged “per se” lawful. (App. Vol. 3 at 142). Dealers reasoned that there was no violation of the DCSA because
[23] Despite arguing that the 2019 Doc Fee Amendment applied retroactively, Dealers argued that Consumers could not use that retroactive amendment to prove their DCSA claim that Dealers had failed to include the Doc Fee in the advertised sale price. Specifically, Dealers argued that “[Consumers‘] allegations regarding advertised prices [would] fail because [Dealers] c[ould] not have intentionally misrepresented a requirement they did not know existed[.]” (App. Vol. 3 at 142). In other words, Dealers argued that the 2019
[24] In response to Dealers’ retroactivity argument, Consumers argued that their DCSA claims were not precluded by the 2019 Doc Fee Amendment. They asserted that the amendment could “not be applied retroactively to bar the [Consumers‘] vested rights to their causes of action that [had] accrued before May 5, 2019.” (App. Vol. 3 at 198). Alternatively, Consumers asserted that even if the 2019 Doc Fee Amendment applied retroactively, it neither expressly permitted the Doc Fees charged nor provided that charging a Doc Fee of less than $200 was a lawful practice. Consumers pointed out that “[a] rule forbidding fees in excess of $200 [wa]s not express permission to charge lower fees in deceptive and misleading ways.” (App. Vol. 3 at 202). Consumers argued that the allegations in their complaints stated a violation of the DCSA and that the trial court should deny Dealers’ motion to dismiss Consumers’ DCSA claims.
[25] In their Consolidated MTD, Dealers also argued in the alternative to retroactivity of the statute. Specifically, Dealers argued that Consumers’ DCSA claims were barred even if the statute did not apply retroactively. Dealers asserted that even if they had violated the pre-amendment version of the MVDSA Doc Fee statute, the Gasbi Court had explained that such a violation of the MVDSA was not a per se violation of the DCSA. Dealers argued that the trial court should dismiss Consumers’ DCSA claims because Consumers
[26] In response, Consumers asserted that Dealers’ argument that dismissal was required under the pre-amendment statute was “directly contrary” to the Gasbi case that had “sparked these cases.” (App. Vol. 3 at 206). Consumers pointed out that Gasbi had held that the consumers’ complaint had stated claims under the DCSA where they had alleged that the Doc Fees were part of an unfair practice under the pre-amendment statute and generally constituted deceptive acts under the DCSA. Consumers asserted that, like the consumers in Gasbi, their complaints had contained the same assertions and should not be dismissed.
[27] Additionally, Dealers argued that the two-year statute of limitations applicable to DCSA claims barred three of the individual consumer plaintiffs’ DCSA claims. Specifically, Dealers contended that the alleged transactions of those plaintiffs had occurred more than two years before the applicable complaints had been filed.9
[29] Finally, in regard to Consumers’ constructive fraud and unjust enrichment claims, Dealers argued those claims should be dismissed because they were based on violations of the MVDSA, which they asserted had abrogated any common law claim. Dealers also argued that Consumers’ constructive fraud and unjust enrichment claims were duplicative of their DCSA claim and that the dismissal of the DCSA claim should also lead to a dismissal of the constructive fraud and unjust enrichment claims.
[30] In response to this argument, Consumers argued that the MVDSA had not abrogated their common law claims. Additionally, Consumers argued that their complaints had sufficiently stated claims for constructive fraud and unjust enrichment.
[31] On June 16, 2020, the trial court held a hearing on the two pending motions. Thereafter, on July 31, 2020, the trial court issued the two interlocutory orders at issue in this appeal. The trial court‘s comprehensive orders addressed in detail the arguments raised by Dealers and Alter Ego Dealers and contained the trial court‘s reasoning for denying their motions to dismiss. In relevant part, the trial court, for purposes of Dealers’ Consolidated MTD, treated the 2019 Doc
[32] Thereafter, Dealers and Alter Ego Dealers filed motions requesting the trial court to certify its two orders and to stay the proceedings. The trial court granted both requests. Dealers and Alter Ego Dealers then sought permission to file this interlocutory appeal, and this Court granted their request.
Decision
[33] In this appeal, Dealers challenge the trial court‘s interlocutory order denying their Consolidated MTD, and Alter Ego Dealers challenge the trial court‘s interlocutory order denying their Alter Ego MTD. We will review each order in turn.
[34] We view motions to dismiss under
A
Trial Rule 12(B)(6) motion to dismiss for failure to state a claim upon which relief can be granted tests the legal sufficiency of a claim, not the supporting facts. Accordingly, we view the complaint in the light most favorable to the non-moving party and draw every reasonable inference in favor of that party. We stand in the shoes of the trial court and must determine if the trial court erred in its application of the law. A motion to dismiss is proper if it is apparent that the facts alleged in the challenged pleading are incapable of supporting relief under any set of circumstances. In making this determination, we look only to the complaint and may not resort to any other evidence in the record.
Gasbi, 120 N.E.3d at 617 (cleaned up). “A complaint is sufficient and should not be dismissed so long as it states any set of allegations, no matter how unartfully pleaded, upon which the plaintiff could be granted relief.” Id. at 621 (cleaned up).
[36] We first turn to Dealers’ challenge to the trial court‘s interlocutory order denying their Consolidated MTD. Some of Dealers’ arguments for their motion to dismiss are grounded in statutory interpretation. “If the language of a statute is clear and unambiguous, we need not apply rules of construction other than to require that words and phrases be given their plain, ordinary, and usual meaning.” Gasbi, 120 N.E.3d at 617. On the other hand, “if a statute is open to more than one interpretation, it is deemed ambiguous and subject to judicial construction.” Id.
[37] Here, Consumers’ complaints alleged, in part, that the Doc Fees charged by Dealers were contrary to the MVDSA Doc Fee Statute and constituted a deceptive act under the DCSA.
- (1) simplify, clarify, and modernize the law governing deceptive and unconscionable consumer sales practices;
- (2) protect consumers from suppliers who commit deceptive and unconscionable sales acts; and
- (3) encourage the development of fair consumer sales practices.
[39] The Deceptive Acts Statute of the DCSA provides that “[a] supplier may not commit an unfair, abusive, or deceptive act, omission, or practice in connection with a consumer transaction.”
[41] The other statute at issue in this appeal is the MVDSA Doc Fee Statute. A Doc Fee is defined as “any fee charged by a dealership concerning the sale of a motor vehicle, regardless of designation, and that includes costs incurred by the dealership for the preparation of documents concerning the sale of a motor vehicle[,]” and it does “not include a fee imposed by a financial institution for
[42] The version of the MVDSA Doc Fee Statute that was in effect when some of the Consumers had filed their initial complaints provided that:
It is an unfair practice for a dealer to require a purchaser of a motor vehicle as a condition of the sale and delivery of the motor vehicle to pay a document preparation fee, unless the fee:
(1) reflects expenses actually incurred for the preparation of documents;
(2) was affirmatively disclosed by the dealer;
(3) was negotiated by the dealer and the purchaser;
(4) is not for the preparation, handling, or service of documents that are incidental to the extension of credit; and
(5) is set forth on a buyer‘s order or similar agreement by means other than preprinting.
[43] The legislature amended the MVDSA Doc Fee Statute on May 5, 2019, declared an emergency for the amendment, and made the effective date of the amended statute retroactive to July 1, 2013. That 2019 Doc Fee Amendment currently provides, in part, as follows:
(a) Except as provided in subsection (b), it is an unfair practice for a dealer to charge a document preparation fee in excess of two hundred dollars ($200). A document preparation fee under this section must be:
(1) included in the advertised sale price of a vehicle; and (2) affirmatively disclosed:
(A) in writing by the dealer during negotiations for the sale of a vehicle to a potential purchaser that states the dollar amount of the document preparation fee to be charged; and
(B) as a separate line item on the purchaser‘s bill of sale or other purchase contract.
[44] On appeal, Dealers raise three main arguments to challenge the trial court‘s denial of their Consolidated MTD. Specifically, Dealers contend that the trial court erred by determining that: (1) Consumers’ DCSA claims were not subject to dismissal based on Dealers’ argument that the 2019 Doc Fee Amendment provided Dealers with express authority to charge Doc Fee under $200; (2) Consumers’ complaints for three individual plaintiffs contained adequate allegations to survive Dealers’ statute of limitations argument at this motion to dismiss stage; and (3) the MVDSA did not abrogate Consumers’ common law claims of constructive fraud and unjust enrichment and that the Consumers’ complaints had adequately alleged those claims to survive a
[45] First, as to Consumers’ DCSA claims, Dealers argue that the trial court should have dismissed those claims because the DCSA does not apply to an act that is expressly permitted by state law. Specifically, Dealers contend that 2019 Doc Fee Amendment of the MVDSA expressly permits Dealers to charge a Doc Fee
[46]
[47] The trial court disagreed with Dealers’ argument that the 2019 Doc Fee Amendment expressly permitted Dealers to charge Doc Fees of $200 or less without restriction. The trial court concluded that “[t]he only explicit designation [in the amended statute] is that Doc Fees over $200 are necessarily unfair” and that “[t]here is no parallel language expressly designating Doc Fees of $200 or less as necessarily fair.” (App. Vol. 3 at 61). The trial court pointed out that the 2019 Doc Fee Amendment also required a dealer to comply with advertising and disclosure requirements when charging a Doc Fee. The trial court also concluded that “[t]here is no language [in the 2019 Doc Fee
[48] We agree that the 2019 Doc Fee Amendment does not expressly permit Dealers to charge Doc Fees of $200 or less.12 While the plain language of the 2019 Doc Fee Amendment provides that the charging of Doc Fee “in excess” of $200 is “an unfair practice” by a dealer, the amended statute contains no language expressly permitting Dealers to charge Doc Fees of $200 or less. See
[49] Given our procedural posture of reviewing the denial of a
[50] Next, we turn to Dealers’ argument that the trial court erred by concluding that Consumers’ complaints contained adequate allegations to survive Dealers’ statute of limitations argument. Dealers had argued that the two-year statute of limitations applicable to DCSA claims barred three of the individual consumer plaintiffs’ DCSA claims. The trial court rejected Dealers’ argument, concluding that, for purposes of the motion to dismiss, the three Consumers’ complaints had adequately alleged fraudulent concealment that could potentially toll the statute of limitations. Specifically, the trial court concluded that “[a]t this stage, [Consumers] need only make allegations supporting a claim for relief” and that “[Consumers] ha[d] alleged that [Dealers] concealed the true purpose of the Doc Fees to [Consumers] through their representations to [Consumers] regarding the purpose of the Doc Fee[,]” which was “sufficient to create an
[51]
[52] Here, Consumers’ complaints alleged that there was a buyer-seller relationship between Consumers and Dealers, and they further alleged that Dealers had violated the DCSA in various ways, including by affirmatively misrepresenting the Doc Fee as a fee incurred by the Dealers for preparation of documents, failing to negotiate the fees, and failing to include fees in the advertised price. Consumers also alleged that Dealers had concealed the nature of the Doc Fee charged and that Dealers’ conduct “constituted an incurable deceptive act because it was done as part of a scheme, artifice, or device, with the intent to defraud or mislead.” (App. Vol. 3 at 106, 130; Appellees’ App. Vol. 2 at 14, 37, 61, 79, 99, 119, 142, 161, 183, 204; Appellees’ App. Vol. 3 at 19, 53).
[53] Again, we recall that this case is before us on a
[55] Consumers argue that the 2019 Doc Fee Amendment of the MVDSA did not abrogate Consumers’ claims under common law. Specifically, Consumers argue that the amended statute of the “MVDSA d[id] not undertake to cover the entire field related to Doc Fees; [instead,] it merely set[] some parameters under which the Doc Fees will be considered an ‘unfair practice’ under the MVDSA.” (Consumers’ Br. 32-33). Consumers contend that the MVDSA 2019 Doc Fee Amendment “does not authorize charging excessive or fraudulent Doc Fees in any amount” nor is it incompatible with common law claims to recover Doc Fees that were deceptively charged. (Consumers’ Br. 33) (emphasis in original).
[56] “[T]here is a presumption that when the legislature enacts a statute, it is aware of the common law and does not intend to make a change unless it expressly or
[57] When rejecting Dealers’ abrogation argument, the trial court pointed out that the MVDSA had no provision explicitly abrogating all other claims related to Doc Fees, and it concluded that “[t]here is no case law supporting [Dealers‘] assertion that the MVDSA subverts all other claims related to vehicle purchasing at the motion to dismiss stage.” (App. Vol. 3 at 71). The trial court concluded, based on this Court‘s Gasbi opinion, that “actions that may implicate the MVDSA can also be brought under other statutes or at common law.” (App. Vol. 3 at 71).
[58] We agree with Consumers and the trial court. Dealers’ abrogation argument seems to rely on the incorrect premise that Consumers’ complaint alleges a claim specifically for a violation of the MVDSA, which has no private right of action. Here, however, Consumers are not alleging a claim that Dealers’ conduct was in direct violation of the MVDSA. Instead, Consumers’ claims allege that Dealers’ conduct was in violation of the DCSA and constituted constructive fraud and unjust enrichment. It is presumed that when the legislature amended the 2019 Doc Fee Amendment, “it [wa]s aware of the
[59] Next, we address Dealers’ argument that Consumers’ complaints insufficiently stated claims for relief for constructive fraud and unjust enrichment. Specifically, Dealers recognize that Consumers alleged that there was a buyer-seller relationship but contend that Consumers have not sufficiently alleged any express or affirmative statement made to Consumers that would support their claim. Dealers argue that Consumers’ unjust enrichment argument should have been dismissed because the parties had a contract.
[60] We pause to recall that this case is before us on a
[61] “For purposes of constructive fraud, the existence of a duty may arise in . . . the case of a buyer and seller.” BloomBank v. United Fid. Bank F.S.B., 113 N.E.3d 708, 722 (Ind. Ct. App. 2018), trans. denied. “A constructive fraud may arise in a buyer/seller relationship when: (1) a seller makes unqualified statements to induce another to make a purchase; (2) the buyer relies upon the statements; and (3) the seller has professed to the buyer that he has knowledge of the truth of those statements.” Am. Heritage Banco, Inc. v. Cranston, 928 N.E.2d 239, 247 (Ind. Ct. App. 2010), reh‘g denied. The statement made by the seller may include “an omission to induce another to sell.” BloomBank, 113 N.E.3d at 722 n.7. See also Boots v. D. Young Chevrolet, LLC, 93 N.E.3d 793, 799 (Ind. Ct. App. 2018) (“Fraud is not limited only to affirmative representations; the failure to disclose all material facts can also constitute actionable fraud.“), trans. denied.
[62] In regard to the constructive fraud claim, Consumers alleged, in part, that Dealers had a duty of good faith and fair dealing to Consumers and that Dealers, who had superior knowledge, had violated that duty by making various representations and omissions. Consumers further alleged that they had relied upon Dealers’ representations and omissions and that they had been injured.
[63] Taking these facts as true and viewing the pleadings with every reasonable inference in Consumers’ favor, we conclude that Consumers have pleaded the operative facts necessary to establish a claim of constructive fraud. See Anonymous Physician 1, 153 N.E.3d at 278. In other words, because it does not appear to a certainty on the face of the complaints that Consumers are not entitled to relief, a dismissal of Consumers’ complaints would have been improper.
[65] In Lawson v. First Union Mortgage Co., this Court reversed the grant of a
[66] Here, Consumers’ complaints alleged that Dealers had improperly requested, received, and retained funds or unlawful Doc Fees from Consumers. Taking the allegations in Consumers’ complaints as true, as we must do when conducting a
[67] The final issue we address in this appeal is the Alter Ego Dealers’ challenge to the trial court‘s interlocutory order denying their Alter Ego MTD. In its order, the trial court determined, in relevant part, that Consumers’ complaints survived Alter Ego Dealers’ motion to dismiss because Consumers had sufficiently demonstrated a claim under the alter ego doctrine and therefore standing. Specifically, the trial court reviewed the factors for determining whether to apply the alter ego doctrine and found that Consumers’ complaints had alleged multiple factors of how Alter Ego Dealers and Dealers operated as
[68] “Standing requires that a party have a personal stake in the outcome of the lawsuit and must show that he or she has sustained or was in immediate danger of sustaining, some direct injury as a result of the conduct at issue.” Foundations of E. Chicago, Inc. v. City of E. Chicago, 927 N.E.2d 900, 903 (Ind. 2010), decision clarified on reh‘g, 933 N.E.2d 874 (Ind. 2010) (cleaned up). A motion to dismiss for lack of standing may be brought pursuant to
[69] “The corporate alter ego doctrine is a device by which a plaintiff tries to show that two corporations are so closely connected that the plaintiff should be able to sue one for the actions of the other.” Ziese & Sons Excavating, Inc. v. Boyer Const. Corp., 965 N.E.2d 713, 720 (Ind. Ct. App. 2012) (cleaned up). The corporate alter ego doctrine is a subset of piercing the corporate veil.16 Id. “Corporate identity may be disregarded where one corporation is so organized and controlled and its affairs so conducted that it is a mere instrumentality or adjunct of another corporation.” Konrad Motor & Welder Serv., Inc. v. Magnetech Indus. Servs., Inc., 973 N.E.2d 1158, 1165 (Ind. Ct. App. 2012) (cleaned up). “Indiana courts will not recognize corporations as separate entities where evidence shows that several corporations are acting as one.” Id.
[70] When a plaintiff seeks to pierce the corporate veil under the theory of the alter ego doctrine, courts will “consider additional factors, including whether: (1) similar corporate names were used; (2) the corporations shared common
[71] Here, Consumers’ complaints that included Alter Ego Dealers as defendants alleged that these Alter Ego Dealers “operated as alter egos [of Dealers] and as a single business enterprise with respect to the charging of unlawful [Doc Fees].” (App. Vol. 3 at 120; Appellees’ App. Vol. 2 at 24; Appellees’ App. Vol. 2 at 49; Appellees’ App. Vol. 2 at 87; Appellees’ App. Vol. 2 at 107; Appellees’ App. Vol. 2 at 129; Appellees’ App. Vol. 2 at 172; Appellees’ App. Vol. 3 at 7; Appellees’ App. Vol. 3 at 46). Consumers also alleged that the Alter Ego Dealers “share[d] similar corporate names; share[d] overlapping officers, directors, and employees; ha[d] similar business purposes; share[d] certain offices; advertise[d] together as a single unit on their website . . . ; and . . . generally operated in an interconnected and controlled way, such that [they] c[ould] be considered a single unit for liability purposes.” (App. Vol. 3 at 120; Appellees’ App. Vol. 2 at 24-25; Appellees’ App. Vol. 2 at 49-50; Appellees’ App. Vol. 2 at 87; Appellees’ App. Vol. 2 at 107; Appellees’ App. Vol. 2 at 129;
[72] Again, “[a] motion to dismiss under
[73] Affirmed.
Najam, J., and Tavitas, J., concur.
Notes
(b) A supplier commits an unconscionable act that shall be treated the same as a deceptive act under this chapter if the supplier solicits a person to enter into a contract or agreement:
* * * * *
(3) in which the price is unduly excessive;
and there was unequal bargaining power that led the person to enter into the contract or agreement unwillingly or without knowledge of the terms of the contract or agreement.
There is a rebuttable presumption that a person has knowledge of the terms of a contract or agreement if the person signs a written contract.
We note that Dealers also make other arguments about Consumers’ DCSA claims. For example, Dealers argue that the 2019 Doc Fee Amendment was retroactive and constitutional. Here, however, the trial court treated the amendment as retroactive when addressing whether it expressly permitted the disputed Doc Fees, and Consumers did not argue that the amendment was unconstitutional. Accordingly, we need not address these arguments.
We do, however, note that various dealers and consumers in other Doc Fee cases currently existing in other Indiana trial courts may differ on the issue of constitutionality. For example, in a recent memorandum decision, Mike Raisor Auto Grp., Inc. v. Schroeder, 2021 WL 2407869 *1 n.4 (Ind. Ct. App. June 14, 2021), we noted that the automobile dealer had argued that applying the 2019 Doc Fee Amendment would be unconstitutional, and the parties proceeded by applying the Doc Fee Statute in effect at the time of the vehicle transaction.
In Dealers’ Reply Brief, they raise an argument in regard to Consumers’ common law claims that they did not raise in their Appellants’ Brief. Specifically, they assert that Consumers’ constructive fraud and unjust enrichment claims should have been dismissed because they had not alleged damages. “The law is well settled that grounds for error may only be framed in an appellant‘s initial brief and if addressed for the first time in the reply brief, they are waived.” Monroe Guar. Ins. Co. v. Magwerks Corp., 829 N.E.2d 968, 977 (Ind. 2005).