FILED Pursuant to Ind.Appellate Rule 65(D), this Memorandum Decision shall not be regarded as precedent or cited before Mar 30 2012, 9:32 am any court except for the purpose of establishing the defense of res judicata, CLERK collateral estoppel, or the law of the case. of the supreme court, court of appeals and tax court
ATTORNEYS FOR APPELLANTS: ATTORNEYS FOR APPELLEES:
THOMAS G. BURROUGHS JUDY L. WOODS MICHAEL W. HILE STEPHANIE S. PENNINGER OFFER KORIN Benesch Friedlander Coplan & Aronoff LLP RONALD G. SENTMAN Indianapolis, Indiana Katz & Korin Indianapolis, Indiana
IN THE COURT OF APPEALS OF INDIANA BILSLAND, LLC, LPM INVESTMENTS, LLC, ) PHILLIP D. MERVIS, LOUIS MERVIS, ) HENRY BILSLAND, JUSTIN BILSLAND, and ) BIOSAFE ENGINEERING, LLC, ) ) Appellants-Plaintiffs, ) ) vs. ) No. 32A01-1106-PL-266 ) BRADLEY D. CRAIN and ) RICHARD J. REDPATH, ) ) Appellees-Defendants. )
APPEAL FROM THE HENDRICKS SUPERIOR COURT The Honorable David H. Coleman, Judge Cause No. 32D02-1012-PL-39
March 30, 2012
MEMORANDUM DECISION - NOT FOR PUBLICATION
MAY, Judge Bilsland, LLC (Bilsland), LPM Investments, LLC (LPM), Phillip D. Mervis (Phillip),
Louis Mervis (Louis), Henry Bilsland (Henry), Justin Bilsland (Justin), and BioSAFE
Engineering, LLC (BioSAFE) (collectively, “Appellants”) appeal the trial court’s grant of an
Indiana Trial Rule 12(B)(8) motion1 by Bradley D. Crain (Crain) and Richard J. Redpath
(Redpath) to dismiss Appellants’ claim in Hendricks Superior Court. The Appellants also
argue even if the motion to dismiss was properly granted, the trial court should not have
dismissed the matter with prejudice. We affirm.
FACTS AND PROCEDURAL HISTORY
Redpath was Vice President of Engineering of a company called Waste Reduction by
Waste Reduction, Inc. (WR2) until that company went bankrupt and closed its doors in 2006.
In January 2007, Crain and Redpath formed BioSAFE, a company “engaged in the sale,
manufacturing, installation, and maintenance of equipment for the treatment and disposal of
animal and human, medical and biological waste worldwide.” (App. at 94.) In July 2007,
Crain and Redpath, through BioSAFE wished to purchase the remaining WR2 assets at a
bankruptcy court auction, but were unable to secure funding for that purchase through a bank
loan.
Crain contacted Henry, a local investor, about investing in BioSAFE. Henry and his
friend, Louis, both agreed to contribute money for the purchase of WR2’s assets. In
September 2007, BioSAFE purchased the WR2 assets at the bankruptcy auction. After
1 A trial court may dismiss an action pursuant to T.R. 12(B)(8) if the same action is pending in another court. 2 providing funding for the purchase of the WR2 assets, Henry and Louis drafted an
Investment Agreement and Employment Agreement, which all parties signed.
The terms of both Agreements are at issue in a pending Marion County action filed by
Crain and Redpath (Marion County Action) but the parties agree Henry and Louis controlled
BioSAFE through their companies Bilsland and LPM, respectively, and the Employment
Agreement includes a non-compete clause. As part of the agreement, BioSAFE’s Board of
Directors would have three members chosen by Henry and Louis, and two members chosen
by Crain and Redpath.
Friction arose amongst Henry, Louis, Crain, and Redpath. On June 14, 2010,
BioSAFE’s Board of Directors terminated Crain’s and Redpath’s employment with
BioSAFE. In response, on September 16, Crain and Redpath filed the Marion County Action
alleging breach of contract, breach of fiduciary duties, and unjust enrichment. They
requested injunctive relief in the form of inspection of BioSAFE’s records and reinstatement
into their previous positions with BioSAFE, monetary damages, and attorneys’ fees.
On December 20, Appellants filed their answer to the Marion County Action, and
filed their own action in Hendricks County (Hendricks County Action). On January 20,
2011, Crain and Redpath filed a motion to dismiss the Hendricks County Action pursuant to
Indiana Trial Rule 12(B)(8). After each side filed memoranda of law and response thereto,
the trial court decided it did not need oral argument. On May 23, the Hendricks County court
dismissed the Hendricks County Action with prejudice pursuant to T.R. 12(B)(8) because the
3 case was pending in another state court. Appellants filed a motion to reconsider, which the
trial court denied.
DISCUSSION AND DECISION
1. Motion to Dismiss Pursuant to T.R. 12(B)(8)
Indiana Trial Rule 12(B)(8) provides for dismissal of an action when “[t]he same
action [is] pending in another state court of this state.” As a general rule, when an action is
pending in an Indiana court, all other Indiana courts must defer to that court’s jurisdiction
over the case. Beatty v. Liberty Mut. Ins. Group, 893 N.E.2d 1079, 1084 (Ind. Ct. App.
2008). We review de novo a trial court’s dismissal of an action pursuant to T.R. 12(B)(8).
Id.
In our review, we determine whether the parties, subject matter, and remedies are
precisely or substantially the same. Id. We consider “not whether parts of one lawsuit are
the same or similar to parts of the other, rather, each lawsuit as a whole should be examined.”
In re Stephen L. Chapman Irrevocable Trust Agreement, 953 N.E.2d 573, 578 (Ind. Ct. App.
2011). Whether two actions are the same “depends on whether the outcome of one action
will affect the adjudication of the other.” Kentner v. Ind. Pub. Employers’ Plan, Inc., 852
N.E.2d 565, 570 (Ind. Ct. App. 2006), reh’g denied, trans. denied.
The parties in the two actions are identical -- Bilsland, LPM, Phillip, Louis, Henry,
Justin, and BioSAFE versus Crain and Redpath. Therefore, this supports a conclusion the
actions are the same.
4 Appellants argue the subject matter of the two actions is different because the filings
in the Marion County Action did not include a copy of the Investment Agreement, nor do any
of the pleadings mention that agreement by name. Thus, Appellants claim, their Hendricks
County Action, which filings included the Investment Agreement and which pleadings
specifically allege Crain and Redpath fraudulently induced them to enter into the Investment
Agreement, is an entirely separate action from the claims of Crain and Redpath in Marion
County. We cannot agree.
When two claims in two different courts arise from the same series of transactions or
occurrences, the actions are substantially the same for purposes of T.R. 12(B)(8). See Beatty,
893 N.E.2d at 1087 (“Although the allegations in the two courts are not identical . . . there is
clear and substantial overlap in the subject matter.”). In the Marion County Action, Redpath
and Crain discuss events between 2007, when the parties contemplated and entered into the
Investment and Employment Agreements that are the subjects of the Actions, and 2010,
when Redpath and Crain were terminated from BioSAFE. Appellants’ Hendricks County
Action tracks the same timeframe and series of events, albeit from a different perspective.
While both actions may have different allegations and theories for relief, the overarching
subject matter – wrongdoing by one party against the other while the parties were in business
together – is substantially the same.
Free access — add to your briefcase to read the full text and ask questions with AI
FILED Pursuant to Ind.Appellate Rule 65(D), this Memorandum Decision shall not be regarded as precedent or cited before Mar 30 2012, 9:32 am any court except for the purpose of establishing the defense of res judicata, CLERK collateral estoppel, or the law of the case. of the supreme court, court of appeals and tax court
ATTORNEYS FOR APPELLANTS: ATTORNEYS FOR APPELLEES:
THOMAS G. BURROUGHS JUDY L. WOODS MICHAEL W. HILE STEPHANIE S. PENNINGER OFFER KORIN Benesch Friedlander Coplan & Aronoff LLP RONALD G. SENTMAN Indianapolis, Indiana Katz & Korin Indianapolis, Indiana
IN THE COURT OF APPEALS OF INDIANA BILSLAND, LLC, LPM INVESTMENTS, LLC, ) PHILLIP D. MERVIS, LOUIS MERVIS, ) HENRY BILSLAND, JUSTIN BILSLAND, and ) BIOSAFE ENGINEERING, LLC, ) ) Appellants-Plaintiffs, ) ) vs. ) No. 32A01-1106-PL-266 ) BRADLEY D. CRAIN and ) RICHARD J. REDPATH, ) ) Appellees-Defendants. )
APPEAL FROM THE HENDRICKS SUPERIOR COURT The Honorable David H. Coleman, Judge Cause No. 32D02-1012-PL-39
March 30, 2012
MEMORANDUM DECISION - NOT FOR PUBLICATION
MAY, Judge Bilsland, LLC (Bilsland), LPM Investments, LLC (LPM), Phillip D. Mervis (Phillip),
Louis Mervis (Louis), Henry Bilsland (Henry), Justin Bilsland (Justin), and BioSAFE
Engineering, LLC (BioSAFE) (collectively, “Appellants”) appeal the trial court’s grant of an
Indiana Trial Rule 12(B)(8) motion1 by Bradley D. Crain (Crain) and Richard J. Redpath
(Redpath) to dismiss Appellants’ claim in Hendricks Superior Court. The Appellants also
argue even if the motion to dismiss was properly granted, the trial court should not have
dismissed the matter with prejudice. We affirm.
FACTS AND PROCEDURAL HISTORY
Redpath was Vice President of Engineering of a company called Waste Reduction by
Waste Reduction, Inc. (WR2) until that company went bankrupt and closed its doors in 2006.
In January 2007, Crain and Redpath formed BioSAFE, a company “engaged in the sale,
manufacturing, installation, and maintenance of equipment for the treatment and disposal of
animal and human, medical and biological waste worldwide.” (App. at 94.) In July 2007,
Crain and Redpath, through BioSAFE wished to purchase the remaining WR2 assets at a
bankruptcy court auction, but were unable to secure funding for that purchase through a bank
loan.
Crain contacted Henry, a local investor, about investing in BioSAFE. Henry and his
friend, Louis, both agreed to contribute money for the purchase of WR2’s assets. In
September 2007, BioSAFE purchased the WR2 assets at the bankruptcy auction. After
1 A trial court may dismiss an action pursuant to T.R. 12(B)(8) if the same action is pending in another court. 2 providing funding for the purchase of the WR2 assets, Henry and Louis drafted an
Investment Agreement and Employment Agreement, which all parties signed.
The terms of both Agreements are at issue in a pending Marion County action filed by
Crain and Redpath (Marion County Action) but the parties agree Henry and Louis controlled
BioSAFE through their companies Bilsland and LPM, respectively, and the Employment
Agreement includes a non-compete clause. As part of the agreement, BioSAFE’s Board of
Directors would have three members chosen by Henry and Louis, and two members chosen
by Crain and Redpath.
Friction arose amongst Henry, Louis, Crain, and Redpath. On June 14, 2010,
BioSAFE’s Board of Directors terminated Crain’s and Redpath’s employment with
BioSAFE. In response, on September 16, Crain and Redpath filed the Marion County Action
alleging breach of contract, breach of fiduciary duties, and unjust enrichment. They
requested injunctive relief in the form of inspection of BioSAFE’s records and reinstatement
into their previous positions with BioSAFE, monetary damages, and attorneys’ fees.
On December 20, Appellants filed their answer to the Marion County Action, and
filed their own action in Hendricks County (Hendricks County Action). On January 20,
2011, Crain and Redpath filed a motion to dismiss the Hendricks County Action pursuant to
Indiana Trial Rule 12(B)(8). After each side filed memoranda of law and response thereto,
the trial court decided it did not need oral argument. On May 23, the Hendricks County court
dismissed the Hendricks County Action with prejudice pursuant to T.R. 12(B)(8) because the
3 case was pending in another state court. Appellants filed a motion to reconsider, which the
trial court denied.
DISCUSSION AND DECISION
1. Motion to Dismiss Pursuant to T.R. 12(B)(8)
Indiana Trial Rule 12(B)(8) provides for dismissal of an action when “[t]he same
action [is] pending in another state court of this state.” As a general rule, when an action is
pending in an Indiana court, all other Indiana courts must defer to that court’s jurisdiction
over the case. Beatty v. Liberty Mut. Ins. Group, 893 N.E.2d 1079, 1084 (Ind. Ct. App.
2008). We review de novo a trial court’s dismissal of an action pursuant to T.R. 12(B)(8).
Id.
In our review, we determine whether the parties, subject matter, and remedies are
precisely or substantially the same. Id. We consider “not whether parts of one lawsuit are
the same or similar to parts of the other, rather, each lawsuit as a whole should be examined.”
In re Stephen L. Chapman Irrevocable Trust Agreement, 953 N.E.2d 573, 578 (Ind. Ct. App.
2011). Whether two actions are the same “depends on whether the outcome of one action
will affect the adjudication of the other.” Kentner v. Ind. Pub. Employers’ Plan, Inc., 852
N.E.2d 565, 570 (Ind. Ct. App. 2006), reh’g denied, trans. denied.
The parties in the two actions are identical -- Bilsland, LPM, Phillip, Louis, Henry,
Justin, and BioSAFE versus Crain and Redpath. Therefore, this supports a conclusion the
actions are the same.
4 Appellants argue the subject matter of the two actions is different because the filings
in the Marion County Action did not include a copy of the Investment Agreement, nor do any
of the pleadings mention that agreement by name. Thus, Appellants claim, their Hendricks
County Action, which filings included the Investment Agreement and which pleadings
specifically allege Crain and Redpath fraudulently induced them to enter into the Investment
Agreement, is an entirely separate action from the claims of Crain and Redpath in Marion
County. We cannot agree.
When two claims in two different courts arise from the same series of transactions or
occurrences, the actions are substantially the same for purposes of T.R. 12(B)(8). See Beatty,
893 N.E.2d at 1087 (“Although the allegations in the two courts are not identical . . . there is
clear and substantial overlap in the subject matter.”). In the Marion County Action, Redpath
and Crain discuss events between 2007, when the parties contemplated and entered into the
Investment and Employment Agreements that are the subjects of the Actions, and 2010,
when Redpath and Crain were terminated from BioSAFE. Appellants’ Hendricks County
Action tracks the same timeframe and series of events, albeit from a different perspective.
While both actions may have different allegations and theories for relief, the overarching
subject matter – wrongdoing by one party against the other while the parties were in business
together – is substantially the same.
Adjudication of the Marion County Action would affect adjudication of the Hendricks
County Action. For example, if the Marion County Court were to find Appellants breached
the Employment Agreement as Redpath and Crain alleged, then the Appellants’ complaint
5 alleging Redpath and Crain breached the same Employment Agreement would be precluded
by res judicata. Appellants note their Hendricks County Action includes allegations not
addressed in the Marion County Action, and adjudication of those issues allegedly would not
overlap. However, both actions involve the same parties, timeframe, and series of events.
Even if their impact on one another is not evident at this stage of the proceedings, such
overlap is likely.
Finally, the remedies requested are substantially similar. In the Marion County
Action, Redpath and Crain asked for injunctive relief in the form of access to BioSAFE’s
company records and accountings and reinstatement of their ownership interests in BioSAFE;
money damages; and attorneys’ fees. The Hendricks County Action requests money damages
and attorneys’ fees. Although the two sets of remedies are not identical, they are
substantially similar because they seek relief based on the same set of events and occurrences
during the same time frame. It is possible the relief granted in one could preclude the
adjudication of the other.
The parties, subject matter, and remedies requested in the Marion County Action and
the Hendricks County Action are sufficiently similar to permit dismissal under T.R. 12(B)(8),
and we accordingly affirm.
2. Dismissal with Prejudice
The Hendricks County Court dismissed the action with prejudice. Appellants argue
the dismissal with prejudice is “conclusive of the rights of the parties and is res judicata as to
any questions that might have been litigated.” (Br. of Appellant at 25) (citing Richter v.
6 Asbestos Insulating & Roofing, 790 N.E.2d 1000, 1002-03 (Ind. Ct. App. 2003), trans.
denied). We disagree.
Richter does not control. In Richter, the trial court dismissed with prejudice on T.R.
12(B)(6) grounds. That precluded Richter from filing a Wrongful Death or Products
Liability Action against Asbestos Insulating and Roofing for her husband’s death because her
husband, while alive, consented to dismissal with prejudice of any claims he developed lung
cancer due to asbestos exposure. We affirmed the dismissal of Richter’s claims because her
husband’s earlier consent to dismissal with prejudice of the subject matter was res judicata;
thus, she was not able to state a claim against Asbestos Insulating and Roofing.
The Hendricks County Action was dismissed with prejudice pursuant to T.R.
12(B)(8), which bars a party from litigating the same issues in two separate courts. Thus, the
Hendricks County court’s dismissal was based on its lack of jurisdiction, not the merits of the
case. In City of Hammond v. Board of Zoning Appeals, 152 Ind. App. 480, 486, 284 N.E.2d
119, 124 (1972), we held an attack on a court’s jurisdiction is not a decision on the merits,
but instead determines only whether the court may consider the claim. Thus, the dismissal of
that claim with prejudice is not res judicata regarding the factual and legal merits of those
claims.
The same rationale applies in the instant case. Crain and Redpath filed a motion to
dismiss the Hendricks County Action based on T.R. 12(B)(8) because their Marion County
Action included the same parties and substantially similar subject matter and remedies. The
Hendricks County Court dismissed because the Marion County Action was still pending. This
7 is a jurisdictional decision, not one on the merits of the issues presented. Based on our
holding in City of Hammond, 152 Ind. App. at 487, 284 N.E.2d at 124, it is not res judicata
regarding the claims asserted. Therefore, dismissal with prejudice was proper.
CONCLUSION
The trial court correctly dismissed the Hendricks County Action pursuant to T.R.
12(B)(8) because the Marion County Action involved the same parties and substantially
similar subject matter and remedies. Dismissal with prejudice was not improper because the
dismissal was based on jurisdiction, not on the merits. Accordingly, we affirm.
Affirmed.
CRONE, J., and BROWN, J., concur.