7th Circuit Court of Appeals
Agency Action – EPA Ruling/State Standing to Appeal
State of Indiana v. Environmental Protection Agency
Indiana had standing to appeal EPA approval of a change in how Illinois monitors for auto emissions, but the state failed to show the Environmental Protection Agency’s decision was arbitrary and capricious, the 7th Circuit Court of Appeals ruled.
The Chicago area, in which EPA includes Indiana’s Lake and Porter counties, was classified as a nonattainment area for ozone pollution after Illinois changed its vehicle inspection and maintenance program required by the Clean Air Act.
Indiana objected to a 2005 change that it says caused a measurement in excess of EPA limits for ozone pollution. Before that time, Illinois tested nearly all vehicle emissions, but changed the law that year to exclude testing of pre-1996 model-year cars and trucks.
EPA approved Illinois’ state improvement plan several years later that incorporated the 2005 change over Indiana’s objection, resulting in this review.
“On the preliminary question of whether a justiciable controversy exists, we conclude that Indiana has standing to bring this petition for review. However, because EPA did not act arbitrarily and capriciously in approving the SIP revision, we deny Indiana’s petition,” Judge Joel Flaum wrote for the panel.
Civil – Discrimination/Retaliation
Chontel M. Miller v. Polaris Laboratories, LLC
A former Indianapolis lab technician presented enough evidence to support her claims of discrimination and retaliation that the 7th Circuit Court of Appeals overturned summary judgment in favor of her former employer.
Chontel Miller filed a lawsuit against Polaris Laboratories after she was fired for not meeting performance goals. She was required to process 260 samples daily and over eight months, she never hit that level of productivity.
Miller, who was the only African-American processing technician, claimed racial discrimination caused her work to suffer. She charged her supervisors made racially derogatory comments about her and manipulated her trays of samples so she had more difficult work to do which slowed her down.
The U.S. District Court for the Southern District of Indiana granted Polaris’ motion to dismiss. Initially, the District Court denied summary judgment to Polaris on the discrimination claim, finding Miller had presented sufficient evidence under a cat’s paw theory that the racial bias of supervisors led to management’s decision to terminate her employment.
On reconsideration, the District Court agreed with Polaris that Miller had no evidence supporting her claim that the manipulation of her work by her supervisors could systematically reduce her productivity.
The 7th Circuit Court of Appeals did not agree. It found Miller had demonstrated a dispute of material fact on both her claims and reversed the ruling.
Polaris countered that Miller’s firing was a direct consequence of her poor job performance. Miller did not dispute she was not meeting her quota but she argued her supervisors, acting upon their racial animus, tampered with her work.
The Chicago panel concluded Miller had cleared the hurdle by showing a dispute of fact on the question of whether the actions of the middle managers were motivated by racial animus. She presented evidence the supervisors referred to her in racially inappropriate terms.
On the more difficult question of whether her supervisors purposefully sabotaged her work and caused her termination, the 7th Circuit found Miller was also successful. In particular, the judges noted, Miller does not have to prove systematic tampering at this point. Rather, she only needs to produce evidence that raises an inference that such tampering occurred to the extent it slowed her productivity.
“It may be difficult to marshal evidence that coworkers and lower-level supervisors harbored discriminatory animus against a plaintiff and thwarted her ability to perform her work effectively, and it may be even harder to show that this is what lies behind a decisionmaker’s adverse job action,” Chief Judge Diane Wood wrote for the court. “Taking the summary judgment record in the light most favorable to Miller, however, as we must, we conclude that she has made it over the line. Although Polaris has some evidence that Miller’s work could not have been manipulated to the extent she claims, it is not ironclad.”
Civil – Marriage/DOC Inmate
Rebecca Riker v. Bruce Lemmon, in his official capacity, et al.
A former contract worker who quit her job at an Indiana prison after her sexual relationship with an inmate was discovered was wrongly denied permission to marry him, the 7th Circuit Court of Appeals ruled.
Rebecca Riker was an Aramark employee who worked for a few months in late 2007 and early 2008 in food service. She supervised Paul Vest, who was serving a 50-year sentence for robbery with serious bodily injury. After another Aramark employee saw Riker kissing Vest in a walk-in cooler, the employee reported the incident and Riker quit the next day.
Riker and Vest continued to communicate by mail and phone, but the prison would not allow Riker to visit and also denied her request to marry Vest because she was not on his list of approved visitors. DOC has a policy under which marriages between inmates and former employees may be barred, but the 7th Circuit panel noted this wasn’t referenced as a reason to deny Riker’s marriage application.
The panel reversed summary judgment in favor of DOC defendants.
“We respectfully disagree with the district court and conclude that, on this record, the defendants have failed to justify adequately the denial of Ms. Riker’s marriage request. We accordingly reverse the judgment of the district court and remand the case for further proceedings,” Senior Judge Kenneth F. Ripple wrote for the panel.
DOC contends the marriage must not be allowed because its policy creates a deterrent effect for employees and that allowing the marriage of an inmate to someone with knowledge of the facility and DOC employee policies would create security risks.
But Ripple wrote that the DOC failed to substantiate possible risks of allowing Riker and Vest to marry. He wrote in a footnote that DOC “fundamentally misconceives the issue before the court” by relying on denial of visitation to prevent the pair from marrying.
“It is implausible to suggest, without some supporting evidence, that a brief marriage ceremony cannot be accommodated without threatening institutional security and without imposing more than a de minimis impact on prison resources,” Ripple wrote.
“The district court erred in granting the Department’s motion for summary judgment and concluding that the Department’s denial of Ms. Riker’s request for a brief, one-time visit in order to participate in a marriage ceremony did not violate her constitutional right to marry,” the panel concluded. “The judgment of the district court is reversed, and the case is remanded for further proceedings consistent with this opinion. Ms. Riker may recover the costs of this appeal.”
Indiana Tax Court
Tax – Utilities
Hamilton Southeastern Utilities, Inc. v. Indiana Department of State Revenue
The sewer utility serving fast-growing Fishers won a partial victory on its appeal of a tax on connection fees, but the Indiana Tax Court didn’t fully rule in favor of Hamilton Southeastern Utilities.
Builders must pay a system development charge of $2,400 per dwelling added to the system and a $305 connection fee, according to the record. Some of that revenue is shared with the city of Fishers, which issues building permits after the fees are collected.
The utility challenged the state’s assessment of utility receipts tax on those fees for the 2006-2008 tax years in an appeal originated in October 2012.
Tax Court Judge Martha Blood Wentworth ruled in the utility’s favor on two of three issues. She held the tax for development charges and connection fees did not apply under I.C. 6-2.3-3-10 governing installation, repair or maintenance, or I.C. 6-2.3-3-11 governing delivery of utility services.
She did let the case proceed, though, leaving a genuine issue of material fact as to whether the utility separated its taxable and nontaxable receipts under I.C. 6-2.3-3-2, which could make the revenue collected from the fees subject to taxation. Further proceedings will be ordered.
Indiana Court of Appeals
Criminal – Obstruction of Justice/Invasion of Privacy
Newland McElfresh v. State of Indiana
A defendant’s rambling letter to a victim’s mother was not enough to uphold his convictions for attempted obstruction of justice and invasion of privacy, but it was sufficient to support a lesser charge.
Newland McElfresh pleaded guilty to three counts of child molesting in April 2013. Prior to his hearing and sentencing, he wrote a four-page letter to the mother of one of the abused minors.
The state subsequently charged McElfresh with invasion of privacy, a Class A misdemeanor, and attempted obstruction of justice, a Class D felony. Following a bench trial, the Hendricks Superior Court found McElfresh guilty of these two charges and sentenced him to an aggregate term of 600 days in the Indiana Department of Correction.
On appeal, the Indiana Court of Appeals overturned the two convictions on the grounds the evidence was insufficient. The appellate court found the evidence supported the lesser-included offense of attempted invasion of privacy.
The panel noted McElfresh was not threatening the child, but simply telling the mother the truth that her child would face legal consequences for making false statements to police. That does not constitute trying to coerce the witness to change future testimony.
Also, the Court of Appeals found that although McElfresh may have attempted to indirectly communicate with the child, the contact was not completed. Under Huber V. State, 805 N.E. 2d 887 (Ind. Ct. App. 2004), this is a requirement to support an invasion of privacy charge.
Still, the appellate court found McElfresh’s writing of the letter and requesting the mother to talk to the minor child was a “substantial step” toward committing another crime. The Court of Appeals then remanded with instructions to enter judgment for attempted invasion of privacy, a Class A misdemeanor.
Criminal – Victim Offender Reconciliation Program
Keron D. Rodgers v. State of Indiana
The Indiana Court of Appeals ruled that offenders may not be ordered to participate in the Victim-Offender Reconciliation Program, reversing a sentence and remanding to the trial court for a restitution hearing.
Keron Rodgers led Elkhart police on a chase through a residential neighborhood a year ago before he crashed into a house and fled on foot. He was caught a short time later, charged with Level 6 felony resisting law enforcement and misdemeanor counts of resisting law enforcement, leaving the scene of an accident and driving without a license.
A jury convicted Rodgers on all charges and he was sentenced to a 180-day executed sentence and ordered to pay restitution through VOPR, to which he had not agreed but didn’t object.
“The trial court erred by ordering Rodgers to participate in VORP instead of conducting a hearing about restitution because the order that he participate in VORP was not permissible under the statutes creating VORP,” Judge Melissa May wrote for the panel in a five-page opinion.
May noted the panel took Rodgers’ argument on its merits and cited the plain language of I.C. 35-40-6-4(9) adopted in 1999. The VORP legislation allows victim-offender reconciliation “if the accused person or the offender agrees.”
“Rodgers did not agree to participate in VORP negotiations. We therefore reverse the order that he participate in VORP and remand to the trial court for a restitution hearing,” the panel concluded.
Civil Tort – Class Certification
LHO Indianapolis One Lessee, LLC v. Esther Bowman, Individually and on Behalf of Other Similarly Situated Individuals
Although several Alpha Kappa Alpha Sorority Inc. members who visited Indianapolis in 2013 all reported symptoms much like those caused by food poisoning, the Indiana Court of Appeals denied class certification, ruling the individuals did not specifically link their illnesses to the chicken served at lunch and dinner.
Ester Bowman filed a class-action complaint alleging that she and 61 others suffered personal injury and sustained economic loss as a result of consuming tainted food at the downtown Marriott. Bowman and the others were among the 1,900 sorority members who were attending the 79th Annual AKA Central Regional Conference held at the Marriott in downtown Indianapolis.
Several hours after eating the chicken dish prepared for a special luncheon and attending the evening gala where chicken was also served, Bowman became violently ill and eventually had to be hospitalized.
Other conference attendees reported becoming ill as well. However, the symptoms were wide ranging and there was no consistent place of dining as not everyone ate at both the lunch and evening event.
The Marion Superior Court granted Bowman class certification, finding she had satisfied the requirements of Indiana Trial Rule 23(B)(3).
On appeal, Marriott disputes that Bowman has met the requirements of Indiana Trial Rule 23(B)(3). The hotel contended that even if a jury found that food served at the Marriott was contaminated or defective, each claimant would still need to prove that his or her injuries were proximately caused by consumption of that food.
The trial court had concluded that because Bowman and the class members’ claims all derive from a “common nucleus,” the predominance requirement was satisfied.
However, the Court of Appeals agreed with the Marriott and overturned the class certification.
The Court of Appeals held once Marriott’s general liability is established, each individual member of the class has to show she ingested the tainted food and became ill because of it.
“We cannot emphasize this point strongly enough because generalized proof will not suffice to prove individual damages,” Judge Patricia Riley wrote for the court. “The main problem this appellate court has on review stems from a failure to differentiate between the general and the particular. Although many common issues of fact and law will be capable of resolution on a group basis, customized and particularized damages must be established at an individual level.”
Remanding the case, the Court of Appeals recommended either redefining the class under Indiana Trial Rule 3(C)(4)(a) or continuing the certification under T.R. 23(B)(3) in regard only to Marriott’s general liability. The proximate cause of the members’ illnesses will have to then be determined by a series of individual hearings.
Domestic – Modification of Custody
In re the Marriage of: Christopher Neal Maddux v. Suzanne Marie Maddux
The Indiana Court of Appeals bluntly reversed denial of a father’s petition for primary custody of his children, finding their mother undermined him and deprived him of court-ordered visitation.
The court noted a record in which mother made multiple unsubstantiated abuse allegations, refused to turn the children over for visitation, and ultimately was found in contempt and ordered to pay some of her ex-husband’s legal fees.
Marion Superior Court denied father’s petition for custody modification, finding father had not proved that a change in custody was in the best interests of the children.
“After entering finding after finding illustrating Mother’s audacious and successful attempts to alienate Father from the Children, the trial court concluded that such conduct ‘does not warrant a change of custody,’” Judge Terry Crone wrote for the panel.
“Simply put, time is running out. These children, ages one and three at the time of the divorce, are now eleven and thirteen. They not only have been deprived of their relationship with Father but also have been relentlessly subjected to Mother’s jaded opinions of him and her egregious and unsubstantiated accusations against him. The overwhelming evidence and extensive findings of fact show a mother who has jeopardized her children’s emotional health in attempting to settle a score with their father,” Crone wrote.
“In ruling on Father’s petition for contempt, the trial court concluded that Mother had ‘irreparably harmed [the Children’s] emotional wellbeing.’ … However, in assessing the Children’s best interests, the court inexplicably concluded the opposite. The findings support the trial court’s conclusion of Mother’s irreparable harm to the Children; they do not support the trial court’s determination concerning best interests. The trial court clearly erred in concluding that the Children’s best interests do not warrant a change in custody.”
In addition to remanding for judgment in father’s favor on his petition for modification of custody, the court also ordered a new calculation of child support obligations and credit for support father overpaid.
Civil Plenary – Landowner Issues/Development
Fifty Six LLC, individually and, alternatively, in the name of the State of Indiana on relation of Fifty Six LLC v. The Metropolitan Development Commission of Marion County
A landowner has successfully challenged the Indianapolis Metropolitan Development Commission’s adoption of a plan that reduced potential residential development on 21 acres in the northeast-side community of Millersville.
The Millersville Plan sprang from the Millersville at Fall Creek Valley Community Organization’s efforts to promote the community’s history and culture, connect its parks to greenways, shops and trails, and improve the community for its residents.
Fifty Six LLC, whose agent of record is attorney Rosemary Adams Huffman, owns the acreage in the enclave near East 56th Street and Emerson Way. The landowner sued after the commission adopted a plan that would have reduced residential density on the property from five or six units per acre to one-and-a-half units per acre, according to the record.
A Marion Superior Court ruled in favor of the city, but the decision was reversed by the Indiana Court of Appeals. The city failed to provide required public notice of changes to the plan, and the trial court erred by granting summary judgment in favor of the city and denying Fifty Six’s motion to correct error.
“The designated evidence shows that, although Landowner received a copy of the Revised Description on April 25, 2012, the final draft of the Millersville Plan was not available to the public until, at the earliest, May 11, 2012, was available on the City’s website on May 14, 2012, and was adopted on May 16, 2012, five days after publication of the final draft,” Judge Elaine Brown wrote for the panel.
“We conclude that the Millersville Plan did not comply with the requirement that the plan be published in its entirety ten days prior to a hearing pursuant to Ind. Code § 36-7-4-507. On this basis, we reverse the trial court’s order granting the MDC’s cross-motion for summary judgment and its order denying Landowner’s motion to correct error and remand for further proceedings.”
Civil Plenary – Business Relocation
Andy Mohr West, Inc. d/b/a Andy Mohr Toyota, Butler Motors, Inc. d/b/a Butler Toyota, and TW Toy, Inc. d/b/a Tom Wood Toyota v. Office of the Ind. Sec. of State, Auto Dealer Services Div. et al
Whether three competing greater Indianapolis Toyota dealers may block the relocation of another Toyota franchise from Anderson to Fishers divided a panel of the Indiana Court of Appeals.
Anderson-based Ed Martin Toyota has proposed to relocate to the fast-growing Hamilton County city with the carmaker’s blessing. Andy Mohr Toyota, Butler Toyota and Tom Wood Toyota say not so fast, and after talks with Toyota broke down, the dealers sought relief from the state.
The three Indy-area dealerships were unsuccessful in getting the Auto Dealer Services Division of the Indiana Secretary of State’s Office to find the proposed relocation was without good cause, which would have blocked the move. The division denied their requests, ruling that because the dealerships were outside the 6-mile market area where the dealership would relocate, they lacked standing for a challenge under state law.
The dealerships appealed to a Marion Superior Court that affirmed the division’s ruling, but in a 2-1 ruling, a majority of the Indiana Court of Appeals reversed and sent the matter back to the division for a do-over.
Judges wrangled with interpreting the Indiana Dealer Services statutes as a matter of first impression on whether the proposed entry into the market constituted a proposed dealership or a relocation, each of which is addressed in Indiana Code.
“In sum, the Division’s interpretation of Sections 9-32-2-20 and 9-32-13-24(e) is unreasonable and incorrect as a matter of law,” Judge Edward Najam wrote for the majority joined by Judge John Baker.
“The Division disregards the statutory scheme and fails to account for the fact that the relocation of an existing dealer into the relevant market is every bit as much a threat, if not a greater threat, to the existing dealers within that area as the establishment of a new dealership,” the majority held. “An agency’s interpretation that is contrary to law is entitled to no deference. Accordingly, we reverse the trial court’s judgment and remand to the Division for further proceedings.”
Dissenting Judge Ezra Friedlander wrote that the statutes in question are “undoubtedly inartful, but I am convinced that the Division’s interpretation is reasonable.” He wrote that the majority’s reliance on imprecise language in the statute leads to “troubling results.”
“In my mind, the clear intent of I.C. § 9-32-13-24 is to provide protest rights to affected … dealers regardless of whether the franchisor intends to relocate an existing dealer in/to/within the relevant market area or establish an entirely new dealer in the relevant market area. The applicable relevant market area, in turn, determines which dealers have protest rights.
“Under its reasonable interpretation of the relevant statutes, the Division determined that the applicable relevant market area in this case was the six-mile radius. … The Dealers do not dispute that they are outside this area. Accordingly, I would affirm the trial court’s judgment based upon lack of standing.”
Domestic – Child Support
David V. Taylor v. Sheryl Crowder Taylor
A judge who ordered a modification of child support after a father told the court he was moving out of state and intended to seek custody of a minor child acted prematurely, a Court of Appeals panel majority ruled.
“The trial court held that when Father filed notice of intent to move and his petition to modify custody, the court was also authorized to modify support,” Judge Edward Najam wrote for the majority joined by Judge Ezra Friedlander. “We disagree and hold that the retroactive support order was contrary to law because the statute requires a party to file a petition to modify a child support order.”
The majority remanded the case to Marion Superior Judge Heather A. Welch for a recalculation of the father’s arrearage from March 2013.
Judge John Baker dissented and would affirm the trial court.
“In my view, the majority’s interpretation of the statutes at issue is overly technical. When Father filed his initial motion to modify child custody, he indicated his intent to move out of state and to seek custody” of one of two children, Baker wrote. “Father’s initial motion indicated that he anticipated a change in custody and/or child support. All of these factors, together, served to put the parties and the trial court on notice that child support was an issue.”
Domestic Relation – Pension Benefits
Wesley McDivitt v. Sue McDivitt
While the Indiana Court of Appeals conceded the severance agreement was “not a model of precision,” it disagreed with a trial court’s conclusion that the agreement contained a mistake.
When he retired shortly after his marriage, Wesley McDivitt signed a severance agreement that he would receive his pension benefits in the form of an annuity. The contract shows he selected “joint with 100% to survivor” annuity and he listed his wife, Sue McDivitt, as the beneficiary.
The disposition of Wesley’s pension became the only point of dispute between the couple when they divorced more than 13 years after Wesley retired. Reviewing the agreement, the Tippecanoe Superior Court concluded the contract had wrongly listed Sue as the beneficiary which would have made her entitled to the benefits only after her ex-husband’s death. Instead, the trial court ruled Sue was a co-annuitant and ordered Wesley to pay half of all annuity payments to her.
Wesley appealed, and the Court of Appeals reversed the ruling.
The unanimous panel did not agree with the finding that Sue was a co-annuitant. The judges noted on the severance agreement, she is listed as a beneficiary and the space where a co-annuitant could be identified is blank.
In addition, the checks under the annuity were made payable to Wesley alone and a letter from the plan administrator clearly stated Sue is the designated beneficiary who will receive benefits after Wesley’s death.
The Court of Appeals could not conclude that the McDivitts believed that Sue had acquired an ownership interest in annuity payments made to Wesley during his lifetime.
Criminal – Child Molestation/Competency
Charles Gross v. State of Indiana
A child molestation charge must be dropped against an incompetent defendant who’s been in psychiatric hospitals longer than he could have been imprisoned had he been convicted, the Indiana Court of Appeals ruled.
A concurring judge used the Johnson County case to re-emphasize his call for earlier evaluations of defendants’ mental competency.
Charles Gross was accused of molesting a young cousin more than 12 years ago in Edinburgh. Gross was charged with Class B felony child molesting and Class D felony dissemination of matter harmful to a minor.
Gross never was tried, though, because he has never been found mentally competent. He’s been confined to the Department of Mental Health and Addiction since his arrest in 2003. Johnson Superior Judge Cynthia Emkes denied Gross’ motion to dismiss the charges against him, but the appeals panel reversed in this interlocutory appeal.
“The trial court abused its discretion in finding that Gross was subject to the credit restricted felon statute and denying Gross’s motion to dismiss on that ground,” Judge Margret Robb wrote.
“Because Gross has been confined in excess of the maximum time he could be incarcerated if found guilty of the charges against him and because the superintendent at the facility at which he is confined has made a finding that there is a substantial probability he will never be restored to competency, due process requires that the charges against him be dismissed.”
The credit-restricted felon statute was adopted years after Gross was convicted, making its application to him an ex post facto violation, the court ruled.
Judge Paul Mathias concurred in whole but wrote separately to emphasize that the dismissal of charges is unlikely to result in his release, because he “faces a lifetime of civil commitment.”
Citing his concurring opinion in Habibzadah v. State, 904 N.E.2d 367, 370 (Ind. Ct. App. 2009), Mathias again pointed to a need to determine early in cases whether defendants may have long-term or permanent mental illness.
“I continue to believe that our criminal procedure should permit a psychiatric examination of a defendant who likely suffers from serious mental illness very early after arrest to determine whether the defendant could have possibly had the requisite scienter or mens rea at the time of the crime,” he wrote.•