AMW Investments Inc. v. The Town of Clarksville

CourtIndiana Supreme Court
DecidedDecember 4, 2024
Docket24S-PL-00183
StatusPublished

This text of AMW Investments Inc. v. The Town of Clarksville (AMW Investments Inc. v. The Town of Clarksville) is published on Counsel Stack Legal Research, covering Indiana Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
AMW Investments Inc. v. The Town of Clarksville, (Ind. 2024).

Opinion

FILED Dec 04 2024, 10:47 am

CLERK Indiana Supreme Court Court of Appeals and Tax Court

IN THE

Indiana Supreme Court Supreme Court Case No. 24S-PL-183

AMW Investments, Inc., and Midwest Entertainment Ventures, Inc. d/b/a Theatre X, Appellants,

–v–

The Town of Clarksville, Rick Barr, and Planning Commission for the Town of Clarksville, Appellees.

Argued: June 27, 2024 | Decided: December 4, 2024

Appeal from the Clark Circuit Court No. 10C04-1905-PL-51 The Honorable Marsha Owens Howser, Special Judge

On Petition to Transfer from the Indiana Court of Appeals No. 23A-PL-508

Opinion by Justice Slaughter Chief Justice Rush and Justices Massa, Goff, and Molter concur. Slaughter, Justice.

This case arises from a discovery dispute between AMW Investments and Midwest Entertainment, on one hand, and the Town of Clarksville, on the other. The Town revoked Midwest Entertainment’s adult-entertain- ment license, prompting this litigation. In the ensuing lawsuit, Midwest Entertainment and AMW failed to respond in substance to the Town’s written discovery requests. Even after the trial court ordered Midwest En- tertainment and AMW to respond, they still refused. The court imposed a $30,000 sanction to coerce their compliance. Midwest Entertainment and AMW appealed, the court of appeals reversed, and we granted transfer.

There are two issues before us. The first is whether Midwest Entertain- ment and AMW, while appealing the trial court’s monetary sanction, may also challenge the underlying discovery order they violated. Holding that they may, we must also decide whether Midwest Entertainment and AMW waived their discovery objections. We hold they did waive the ob- jections because they lodged them after the response deadlines imposed by our trial rules. Thus, we affirm the trial court’s sanction and discovery order and remand.

I

A

This case began as an ordinance-enforcement action against an adult- entertainment venue called Theatre X, which is owned by AMW Invest- ments, Inc., and operated by Midwest Entertainment Ventures, Inc. We re- fer to them together as AMW.

In late 2018, the Town of Clarksville suspended AMW’s adult-enter- tainment license and imposed civil fines for violating various local ordi- nances against lewd conduct on the premises. After further violations, the Town revoked AMW’s license in early 2019. AMW sought judicial review of the revocation in the Clark Circuit Court. The Town responded with counterclaims related to the ordinance violations and sought a prelimi- nary injunction barring AMW from operating Theatre X. The trial court

Indiana Supreme Court | Case No. 24S-PL-183 | December 4, 2024 Page 2 of 14 issued the injunction, and the Town moved to impose fines on AMW for each day it violated the Town’s ordinances. AMW appealed entry of the injunction as an appeal of right under Appellate Rule 14(A), leading the trial court to defer ruling on the pending fines motion. Neither the trial nor appellate court stayed proceedings below while the appeal was pend- ing.

After AMW filed its injunction appeal, it sent interrogatories and re- quests for production to the Town. The Town responded in substance to AMW’s requests and then sent its own written discovery—requests for production, requests for admission, and interrogatories—to AMW. After a thirty-day extension from the trial court to finish “preparing responses to the discovery requests”, AMW responded to the Town’s requests by ob- jecting only to jurisdiction.

AMW objects on the basis that discovery is premature and in- appropriate during the pendency of appeal. AMW has consist- ently challenged the propriety of “counterclaims” in the context of an administrative or municipal appeal. That issue is cur- rently on appeal in the context of AMW’s appeal of the Order Granting Preliminary Injunction on November 21, 2019. The Court explicitly noted in its February 25, 2020 Order Regarding Motion for Imposition of Fines that it presently lacks authority during the pendency of the Appeal. This discovery request was issued after the divesture of jurisdiction and during the period jurisdiction was divested by way of appeal. All further and ad- ditional objections are reserved.

The Town responded by letter that AMW’s recurring objection was “baseless”. The Town argued the trial court did not stay discovery by waiting to rule on the fines motion, and the court of appeals did not im- pose a stay. AMW did not respond, leading the Town to move to compel discovery. The Town argued that AMW’s objection lacked merit, and that AMW had “waived any objection other than the jurisdictional one.” AMW did respond to the motion to compel and doubled down on its jurisdic- tional objection, claiming the pending appeal “divested” the trial court of jurisdiction and “foreclosed” the Town’s proposed discovery. Without

Indiana Supreme Court | Case No. 24S-PL-183 | December 4, 2024 Page 3 of 14 acting on the motion to compel, the trial court made a docket entry stating it would “not rule on matters until the appeal has been decided.”

The court of appeals eventually affirmed entry of the injunction, and this Court denied transfer. Midwest Ent. Ventures, Inc. v. Town of Clarksville, 158 N.E.3d 787 (Ind. Ct. App. 2020), trans. denied, 166 N.E.3d 913 (Ind. 2021). The Town renewed its motion to compel in the trial court. It argued again that AMW “waived all other objections” to the discovery requests by raising only a jurisdictional objection in its response to the Town’s dis- covery requests.

Without responding to the Town’s renewed motion, AMW served an- other discovery response—thirteen months after the Town served its ini- tial requests. It produced six documents with unexplained redactions and a slew of new, boilerplate objections. The Town responded to AMW’s lim- ited production and its new objections with another court filing, arguing (among other things) the new objections were unreasonable and waived.

After the trial court held a hearing on the motion to compel, it sided with the Town, calling AMW’s repeat jurisdictional objection “inexcusa- ble”:

No judge of the Court of Appeals ordered a stay of proceed- ings. Neither did this Court. The Court did note in its Order Regarding Motion for Imposition of Fines that it lacked author- ity to grant the Town’s request for $770,000 in fines during the appeal, but it never stated it lacked jurisdiction over the case or that any proceedings (including discovery) were stayed. In fact, this Court ruled on several matters in that same February 25, 2020 Order as the Court found “these issues may arise again.” Nothing in the record validates [AMW’s] theory that the Court lacked jurisdiction. The failure of [AMW] in fully answering the Town’s discovery requests is inexcusable.

The trial court ordered AMW to respond to the Town’s discovery requests and to “withhold nothing on the basis of any objection that [it] failed to raise in [its] initial responses.”

Indiana Supreme Court | Case No. 24S-PL-183 | December 4, 2024 Page 4 of 14 Yet AMW persisted. AMW again asserted boilerplate objections— based on relevance, vagueness, overbreadth, undue burden, harassment, accountant-client privilege, attorney-client privilege, and attorney work product—and withheld responsive documents in its next production. The Town moved to hold AMW in contempt for skirting the discovery order. The trial court agreed.

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