Martin Richard Himsel, Janet Himsel, Robert Lannon, and Susan Lannon v. Indiana Pork Producers Association and Livestock Engineering Solutions , 95 N.E.3d 101 ( 2018 )

FILED
Feb 14 2018, 5:29 am
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEYS FOR APPELLANTS ATTORNEYS FOR APPELLEES
Kim E. Ferraro Andrew M. McNeil
Samuel J. Henderson Daniel P. McInerny
Hoosier Environmental Council Mark A. Wohlford
Valparaiso, Indiana Bose McKinney & Evans, LLP
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Martin Richard Himsel, Janet February 14, 2018
Himsel, Robert Lannon, and Court of Appeals Case No.
Susan Lannon, 32A01-1703-PL-612
Appellants-Plaintiffs, Appeal from the Hendricks
Superior Court
v. The Honorable Mark A. Smith,
Judge
Indiana Pork Producers Trial Court Cause No.
Association and Livestock 32D04-1510-PL-150
Engineering Solutions,
Appellees-Nonparties.
Barnes, Judge.
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Case Summary
[1] In this interlocutory appeal, Martin and Janet Himsel and Robert and Susan
Lannon (collectively “the Plaintiffs”) appeal the trial court’s award of $4,980.50
in attorney fees to Indiana Pork Producers Association, Inc. (“IPPA”) and
$3,925.04 in attorney fees and other expenses to Livestock Engineering
Solutions, Inc. (“LES”), arising from a discovery dispute between the Plaintiffs,
IPPA, and LES. IPPA and LES cross-appeal, contending they were entitled to
more attorney fees. We affirm.
Issues
[2] The restated issues before us are:
I. whether the trial court properly denied the Plaintiffs’
motion to compel the production of documentary evidence
from IPPA and LES, who were nonparties in the
Plaintiffs’ litigation against different defendants; and
II. whether the amount of attorney fees and expenses
awarded to IPPA and LES was reasonable. This includes
both the Plaintiffs’ contention that the trial court awarded
too much and IPPA and LES’s contention that it awarded
too little.
Facts
[3] In 2013, Samuel, Cory, and Clinton Himsel (“the Himsels”) obtained a
rezoning of their property from the Hendricks County Plan Commission to
allow for construction of a concentrated animal feeding operation (“CAFO”).
The Plaintiffs, who live near the property, objected to the rezoning. During a
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hearing regarding the rezoning, Josh Trenary from IPPA testified in favor of the
rezoning, stating in part that no studies had been done regarding odors from
hog CAFOs and denying that there was any correlation between CAFOs and a
loss of value to nearby properties. IPPA essentially is a lobbying and
informational entity for the pork industry in Indiana. The Indiana Department
of Environmental Management (“IDEM”) subsequently issued a permit to
allow construction of a CAFO on the rezoned property.
[4] The Himsels created an LLC, 4/9 Livestock, to own and operate the CAFO.
4/9 Livestock entered into a contract with Co-Alliance, LLP, which would own
the hogs at the CAFO. LES is an agricultural engineering firm that provided
consultation regarding construction of the CAFO and approval of the facility
from IDEM. The CAFO was completed in September 2013 and eventually
housed up to 8,000 hogs.
[5] On October 6, 2015, the Plaintiffs, represented by the Hoosier Environmental
Council, filed suit against the Himsels, 4/9 Livestock, and Co-Alliance; IPPA
and LES were not named as defendants. The complaint alleged that the
Plaintiffs’ use and enjoyment of their homes, as well as their homes’ value, were
ruined by noxious odors and airborne emissions coming from the CAFO.
Furthermore, the complaint alleged that, contrary to Trenary’s testimony at the
rezoning hearing, there are numerous studies indicating that hog CAFOs
generate extreme odors and noxious emissions and that the property values for
persons living nearby are significantly reduced thereby. The complaint sought
recovery under theories of nuisance, negligence, and trespass, and also sought a
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declaratory judgment that Indiana’s “right to farm” laws that favor agricultural
operations are unconstitutional.
[6] On March 28, 2016, the Plaintiffs sent a request for production of documents
and subpoena to IPPA under Indiana Trial Rules 34(C) and 45. The subpoena
noted, as required by the Trial Rules, that IPPA was “entitled to security
against damages or payment of damages resulting from this request.”
Appellant’s App. Vol. II p. 64. The subpoena had eighteen requests, some of
which were divided into multiple subparts, as follows:
1. Any and all documents regarding the Defendants’ CAFO,
the named Defendants in this action, and/or this lawsuit.
2. Any and all communications between the IPPA and any
of the named Defendants in this action, and/or anyone acting on
the Defendants’ behalf, including but not limited to
correspondence, emails, letters, notes taken during telephonic
conversations, and any other record of communication as that
term is defined above.
3. Any and all IPPA intra-office communications, including
but not limited to emails, letters, memoranda, notes taken during
telephonic conversations, proposed responses, and reviews
regarding any of the named Defendants in this action, the
Defendants’ CAFO and/or this lawsuit.
4. All correspondence, documents, or written
communications from, to, or between you, or on your behalf,
and the U.S. EPA (“EPA”), the Indiana Department of
Environmental Management (“IDEM”), the Indiana State
Department of Agriculture (“ISDA”), Hendricks County
officials, or any other governmental entity, local, county, state or
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federal (as well as any of these entities’ agents, servants,
representatives or employees) relating to the Defendants’ CAFO
including but not limited to communications relating to any
aspect of the Defendants obtaining government approvals and/or
permits; monitoring and/or reporting of odors, air emissions or
emissions estimates from the Defendants’ CAFO; or any aspect
of siting, constructing, owning, operating, maintaining or
managing the Defendants’ CAFO.
5. All correspondence, documents, statements or
communications from, to, or between you, or on your behalf,
and any public or private institutions, research center, other
professional, trade or advocacy organization, farm association,
cooperative, union or other similar entities (as well as any of
these entities’ agents, servants, representatives or employees)
relating to any aspect of the Defendants obtaining government
approvals and/or permits; monitoring and/or reporting of odors,
air emissions or emissions estimates from the Defendants’
CAFO; or any aspect of siting, constructing, owning, operating,
maintaining or managing the Defendants’ CAFO.
6. Any and all documents pertaining to permits, variances,
special exceptions, rezoning or other such approvals of any kind
to construct, operate or use land on which the Defendants’
CAFO is located or other land owned or controlled by any of the
named Defendants to this action.
7. Any and all documents regarding the ownership,
management and/or control of the Defendants’ CAFO including
but not limited to production contracts, grower service contracts,
real estate transfer documents, purchase agreements, lease
agreements, partnership agreements, employment contracts, or
operator agreements.
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8. Any and all photographs or videos pertaining to the
Defendants’ CAFO.
9. Joshua Trenary’s entire file regarding the Defendants’
CAFO, his testimony on the Defendants’ behalf before the
Hendricks County Area Plan Commission on March 12, 2013,
and all other documents related to and/or demonstrating the
nature of the relationship and involvement of the IPPA and/or
Joshua Trenary with the Defendants.
10. Please produce a copy of the “study done by Indiana
University using actual sales data to study the relationship
between property values and livestock operations” as referred to
by Joshua Trenary in his testimony before the Hendricks County
Area Plan Commission on March 12, 2013 at the public hearing
on the Defendants’ rezoning request.
11. Please produce a copy of the “cost of community services
study funded by the Indiana Soybean Association” as referred to
by Joshua Trenary in his testimony before the Hendricks County
Area Plan Commission on March 12, 2013 at the public hearing
on the Defendants’ rezoning request.
12. Referring to the Minutes of the March 12, 2013 public
hearing on Defendants’ rezoning request before the Hendricks
County Area Plan Commission, please produce all documents
that support or are related to the following statements made by
Joshua Trenary:
a. “If an operator want[s] to avail himself of the type
of state of the art environmental safeguards available in a
modern livestock facility, it would be necessary to build
one of the size and scope that could maintain that
advanced of a facility and still be profitable.”
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b. “Residents in Hendricks County would be
benefitting from the proposed [Defendants’ CAFO].”
c. “[The Defendants are] a farm family building a
facility that they would own. Both sides of the transaction
would be benefitting or they would not be entering into the
transaction. The family farm is still taking on all of the
financial risk of the facility and the environmental
liability.”
d. “There are no air regulations on a CFO because
there is no consensus in the nation on what emissions
levels are harmful and what levels should be regulated.
There is not enough data to regulate air emissions on
livestock operations.”
13. Any and all test results, findings, reports, records,
spreadsheets, photos, videos or documents of any kind relating to
testing, monitoring, estimates and/or analysis of odors, odorous
compounds and/or air emissions, including but not limited to
airborne emissions of ammonia, hydrogen sulfide, and/or
particulate matter, from any CAFO, CFO or other livestock
facility in Indiana that IPPA has made available to: 1) the
public; 2) members and/or supporters of IPPA; 3) the regulated
community and/or interested stakeholders through educational
seminars, conferences and the like; and/or 4) directly to one or
more of the Defendants within the last ten (10) years.
14. Any and all documents in your possession or control
related to the National Air Emissions Monitoring Study
(NAEMS) conducted by Purdue University and the U.S. EPA
including but not limited to testing data, reports of findings,
photos, videos, publications, fact sheets, bulletins, inter-office
memos, notes, summaries, emails, communications, documents
demonstrating input and/or involvement by participating
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livestock operations, citizens, government agencies, academic
institutions and/or the IPPA such as comments, correspondence,
emails, memos or any other related documents.
15. All IPPA publications, policy papers, fact sheets, bulletins,
newsletters, worksheets or other written information whether
prepared by IPPA or on the Association’s behalf, about
controlling, monitoring, reporting, calculating estimates,
emissions factors, or other analyses of airborne emissions from
CAFOs or CFOs for purposes of any federal, state or local law,
rule, regulation or standard that IPPA has made available to: 1)
the public; 2) members and/or supporters of IPPA; 3) the
regulated community and/or interested stakeholders through
educational seminars, conferences and the like; and/or 4) directly
to one or more of the Defendants within the last ten (10) years.
16. All documents relating to citizen complaints and/or
inquiries, whether formal or informal, made to or received by the
IPPA about odors, odorous compounds and/or air emissions
from CAFOs, CFOs or other livestock operations in Indiana
within the last ten (10) years.
17. All correspondence, documents, statements, memos,
policy papers, briefs or communications from, to, or between
you, or on your behalf, and any public or private institution,
government agency, research center, professional, trade or
advocacy organization, farming association, cooperative, union
or other similar entities (as well as any of these entities’ agents,
servants, representatives or employees) within the last ten (10)
years related to the following:
a. odors, odorous compounds and/or air pollution
from CAFOs or CFOs;
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b. regulation of odors, odorous compounds and/or air
pollution from CAFOs or CFOs;
c. community impacts of CAFOs or CFOs including
but not limited to reduced air quality or reduction in
property values;
d. the application, interpretation or requirements of
Ind. Code § 32-30-6-9;
e. the application, interpretation or requirements of
Ind. Code § 15-11-2(a).
18. Produce all studies, articles, reports, policy papers,
assessments, fact sheets, or other documents in your possession
or control related to the following:
a. odors, odorous compounds and/or air pollution
from CAFOs and CFOs;
b. regulation of odors, odorous compounds and/or air
pollution from CAFOs and CFOs;
c. community impacts of CAFOs or CFOs including
but not limited to reduce air quality or reduction in
property values;
d. the application, interpretation or requirements of
Indiana’s Right to Farm Act at Ind. Code § 32-30-6-9;
e. the application, interpretation or requirements of
Ind. Code § 15-11-2(a).
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Id. at 68-71.
[7] In response to this subpoena, IPPA produced some documents to request
number one but limited those documents to those it deemed nonprivileged and
only those from the time period when IPPA was assisting the Defendants in
obtaining permission to rezone their land and operate a CAFO thereon, or
beginning in March 2013. IPPA also agreed, in response to requests number
ten and eleven, to produce specific reports Trenary had referred to in his
testimony before the Hendricks County Area Plan Commission. IPPA objected
to responding to any of the other subpoena requests. Generally, IPPA claimed
the requests were overbroad, privileged, requested documents not in its
possession, and/or would be overly burdensome for IPPA to comply with.
IPPA also requested “appropriate security against damages it proximately
incurs in responding to this subpoena and reasonably resisting its overbroad
provisions.” Id. at 75. However, it did not specify an amount of security.
[8] Counsel for the Plaintiffs and IPPA engaged in phone, letter, and email
communications in an attempt to resolve their dispute without court
intervention. In response to the Plaintiffs’ request that IPPA specify the
amount of “security” it was seeking for complying with the subpoena, IPPA
wrote in a May 16, 2016 email that it had already incurred approximately
$5,000 in attorney fees and expenses in reviewing and responding to the
subpoena and that it expected that amount to increase. The Plaintiffs did not
pay anything to IPPA at this time.
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[9] On August 10, 2016, the Plaintiffs served a second subpoena duces tecum upon
IPPA. This subpoena generally sought documents and communications in
IPPA’s possession or control related to an “Air Quality Agreement with
Animal Feeding Operations” prepared by the EPA; a 1997-2000 “On-Farm
Odor Management Assistance Program” prepared by the National Pork Board
(“NPB”) and the National Pork Producers Council (“NPPC”); and a 1997-98
“Odor Solutions Initiative” prepared by the NPB and NPPC. The subpoena
also sought information regarding the employment of two individuals with
IPPA. IPPA objected to all the requests in the second subpoena, generally on
the grounds of overbreadth and their irrelevancy to the parties and subject
matter of the litigation between the Plaintiffs and the Defendants. IPPA also
noted that the Plaintiffs had never paid anything toward its attorney fees in
relation to the first subpoena.
[10] Also on August 10, 2016, the Plaintiffs served a subpoena duces tecum upon
LES. The Plaintiffs sought all communications between LES and the
Defendants regarding the construction and operation of the CAFO at issue.
They also sought “[a]ll correspondence, letters, emails, reports, memoranda,
invoices, telephone records, or any other documents in your possession
regarding the at-issue CAFO.” Id. at 160. Furthermore, they wanted to obtain
documents related to the EPA, NPB, and NPPC reports referred to in the
subpoena to IPPA. Finally, the subpoena requested records from LES
regarding the determination of where the CAFO would be located. LES agreed
to provide documents it had produced regarding the CAFO, but asserted there
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were no documents exchanged between it and the Defendants regarding the
CAFO because it had worked with a third party, not any of the Defendants.
LES also asserted that it played no role in determining the location of the
CAFO and so had no documents on that issue. It also asserted it would be
unduly burdensome to obtain all phone records regarding the CAFO, and that
the requests regarding the EPA, NPB, and NPPC reports were overly broad and
unrelated to the parties and subject matter of the litigation.
[11] On October 5, 2016, both IPPA and LES filed formal petitions with the trial
court requesting the Plaintiffs to pay attorney fees related to their response to
the subpoenas.1 IPPA sought $4,980.50 in attorney fees for evaluating and
partially complying with the subpoenas, $3,480.00 for reasonably resisting the
subpoenas, and $5,923.00 for attempting to recover attorney fees for reasonably
resisting the subpoenas. LES sought $2,572.75 in attorney fees for evaluating
and partially complying with the subpoena, and $5,033.00 for reasonably
resisting the subpoena and for attempting to recover attorney fees for reasonably
resisting; LES also sought $1,353.29 in costs for its non-attorney principal’s
time spent responding to the subpoena.
[12] The Plaintiffs filed cross-motions to compel IPPA and LES to fully comply with
the subpoenas, requesting that the trial court deny IPPA and LES’s attorney
fees petitions, and seeking attorney fees of their own. After conducting a
1
IPPA and LES were and are represented by the same attorneys.
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hearing on the matter on February 1, 2017, the trial court entered an order
denying the Plaintiffs’ motion to compel, expressly finding “that the non-parties
reasonably resisted the Plaintiffs’ efforts to seek irrelevant, overbroad and
onerous discovery.” Id. at 27. However, the trial court did not award IPPA
and LES the full amount of attorney fees they were seeking. It awarded IPPA
$4,980.50 and LES $2,572.75 “for time spent evaluating and responding to the
subpoenas”; it also awarded LES $1,352.29 “for direct expenses incurred
responding to the subpoenas . . . .” Id. at 26. The trial court explained its
refusal to award more attorney fees to IPPA and LES by stating, “Just as the
non-parties reasonably resisted, the Plaintiffs sought relief they believed
themselves to be entitled by filing a motion to compel. The Court finds that an
award of additional fees would be unjust under these circumstances.” Id. at 27.
The Plaintiffs now appeal and the Defendants cross-appeal.2
Analysis
[13] The Plaintiffs are appealing an interlocutory order. It is appealable as of right
because the trial court’s order compelled them to pay money to IPPA and LES.
See Ind. Appellate Rule 14(A)(1). Moreover, in the interest of judicial
economy, we will review the intertwined discovery order in this case, the denial
2
On December 16, 2016, the Defendants moved for summary judgment. On October 24, 2017, the trial
court granted summary judgment in favor of the individual defendants but denied it as to the corporate
defendants, 4/9 Livestock and Co-Alliance. The trial court reserved judgment on the constitutionality of the
“right to farm” statutes. 4/9 Livestock and Co-Alliance have filed a motion to correct error in response to
that ruling, which has not yet been resolved.
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of the Plaintiffs’ motion to compel. See White-Rodgers v. Kindle, 925 N.E.2d 406,
411 (Ind. Ct. App. 2010).
I. Denial of Motion to Compel
[14] A trial court has broad discretion in ruling upon discovery matters, and we will
reverse such rulings only when there has been a clear abuse of discretion.
Davidson v. Perron, 756 N.E.2d 1007, 1012 (Ind. Ct. App. 2001), trans. denied.
An abuse of discretion occurs if a decision is clearly against the logic and effect
of the facts and circumstances before the court, or if the trial court has
misinterpreted the law. Wright v. Miller, 989 N.E.2d 324, 330 (Ind. 2013).
There is a presumption that a trial court will act fairly and equitably in each
case before it. Id. Also, “[b]ecause of the fact-sensitive nature of discovery
issues, a trial court’s ruling is cloaked with a strong presumption of
correctness.” Davidson, 756 N.E.2d at 1012. We also note that the trial court
made some written statements accompanying its order that might be construed
as sua sponte findings. We will affirm a general judgment with sua sponte
findings if it can be sustained on an legal theory supported by the record. Farah,
LLC v. Architura Corp., 952 N.E.2d 328, 333 (Ind. Ct. App. 2011).
[15] Indiana Trial Rule 34(C) permits a party to request the production of
documents from a nonparty in conjunction with the issuance of a subpoena
under Trial Rule 45. If a nonparty objects to the subpoena, the requesting party
may file a motion to compel discovery under Trial Rule 37(A). Additionally,
Trial Rule 26(C) “requires that any party or third party from whom discovery is
requested may be protected from ‘annoyance, embarrassment, oppression, or
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undue burden or expense’ and permits a variety of conditions to be imposed.”
In re WTHR-TV, 693 N.E.2d 1, 6 (Ind. 1998). Under the Indiana Trial Rules,
discovery generally should go forward, “but, if challenged, a balance must be
struck between the need for the information and the burden of supplying it.” Id.
“[W]here non-parties to a dispute are involuntarily dragged into court their
interest in being left alone is a legitimate consideration in this balancing and
they are no less entitled to any protections the Trial Rules afford.” Id.
[16] We also set forth the general parameters of permissible discovery found in Trial
Rule 26(B):
Parties may obtain discovery regarding any matter, not
privileged, which is relevant to the subject-matter involved in the
pending action, whether it relates to the claim or defense of the
party seeking discovery or the claim or defense of any other
party, including the existence, description, nature, custody,
condition and location of any books, documents, or other
tangible things and the identity and location of persons having
knowledge of any discoverable matter. It is not ground for
objection that the information sought will be inadmissible at the
trial if the information sought appears reasonably calculated to
lead to the discovery of admissible evidence.
The frequency or extent of use of the discovery methods
otherwise permitted under these rules and by any local rule shall
be limited by the court if it determines that: (i) the discovery
sought is unreasonably cumulative or duplicative, or is obtainable
from some other source that is more convenient, less
burdensome, or less expensive; (ii) the party seeking discovery
has had ample opportunity by discovery in the action to obtain
the information sought or; (iii) the burden or expense of the
proposed discovery outweighs its likely benefit, taking into
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account the needs of the case, the amount in controversy, the
parties’ resources, the importance of the issues at stake in the
litigation, and the importance of the proposed discovery in
resolving the issues. The court may act upon its own initiative
after reasonable notice or pursuant to a motion under Rule 26(C).
[17] IPPA and LES did provide some response to the Plaintiffs’ subpoenas.
Specifically, they agreed to provide documents directly related to construction
of the Defendants’ CAFO. IPPA also agreed to produce written reports that
Trenary specifically mentioned during his testimony before the Hendricks
County Plan Commission. Also, IPPA and LES responded to several of the
document requests stating that they did not have the documents the Plaintiffs
were requesting. For example, LES stated that it had no documents related to
the siting of the CAFO because it was not involved in that decision, nor that it
had direct communications with any of the Defendants. The Plaintiffs continue
to insist on appeal that LES must have some of these documents, but we see no
basis in the record to question LES’s representation that it did not have them.
[18] The Plaintiffs generally contend that they were entitled to seek additional
discovery from IPPA and LES to support their negligence claim, i.e. to prove
that the Defendants knew or should have known that locating their CAFO so
close to the Plaintiffs’ residences would negatively impact their homes because
of odors and noxious emissions. The elements of a negligence action are: (1) a
duty owed to plaintiff by defendant; (2) breach of that duty by conduct falling
below the applicable standard of care; and (3) compensable injury proximately
caused by the breach of duty. Williams v. Cingular Wireless, 809 N.E.2d 473, 476
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(Ind. Ct. App. 2004), trans. denied. Foreseeability of harm is a component of
both duty and proximate cause. Id. at 477. When determining whether a
particular act is the proximate cause of an injury, the issue is whether the injury
was a natural and probable consequence of the act that should have been
foreseen or anticipated in light of the circumstances. Control Techniques, Inc. v.
Johnson, 762 N.E.2d 104, 108 (Ind. 2002).
[19] We will assume for the sake of argument that much of the material the Plaintiffs
were seeking from IPPA and LES was relevant to the question of foreseeability
in a negligence case.3 That is, communications by IPPA and/or LES to the
Defendants regarding foul odors and noxious emissions from CAFOs, or more
general information on that topic, could be relevant to what the Defendants
knew or should have known when they built their CAFO in close proximity to
the Plaintiffs’ homes. However, relevance is not the end of the analysis when it
comes to compelling discovery, especially where a nonparty is concerned.
There are multiple considerations to be balanced, as reflected in Trial Rule
26(B). When weighing those considerations, as well as IPPA’s and LES’s
interests in being left alone as strangers to this litigation, we cannot say the trial
court abused its discretion in denying the Plaintiffs’ motion to compel.
[20] The Plaintiffs’ subpoenas requested a wide breadth of documents from IPPA
and LES, some of them going back two decades. Many of the requested
3
There is no claim by IPPA and LES on appeal that the Plaintiffs were seeking privileged or confidential
information.
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documents had no direct relation to the Defendants’ CAFO or to the
Defendants at all, for that matter. Some of the documents it would appear
could be more readily obtained from other sources, such as information related
to the reports prepared by the EPA, NPB, and NPPC regarding CAFOs.
[21] Most importantly, it appears from the record that the Plaintiffs already acquired
substantial evidence from other sources regarding the readily-available
knowledge of the potentially-harmful effects of CAFOs as reflected in
government, academic, and scientific studies. The Plaintiffs had evidence that
Samuel Himsel and the CEO of Co-Alliance in particular were aware of such
potential harmful effects before the CAFO at issue was constructed. The
Plaintiffs relied upon such evidence and designated it in their response to the
Defendants’ December 16, 2016 summary judgment motion. That evidence
was enough to convince the trial court to deny the corporate Defendants’
summary judgment motion; the court stated in its order denying summary
judgment that there were genuine issues of material fact as to whether the
CAFO was a nuisance, whether the CAFO was negligently sited and operated,
and whether the intrusion of noxious odors onto the Plaintiffs’ properties from
the CAFO constituted trespass.4
[22] Considering the evidence the Plaintiffs were able to compile without obtaining
all the information they sought from IPPA and LES, it is unclear how much
4
The trial court granted summary judgment to the individual Defendants on the basis of the corporate shield
from liability.
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they truly need that information, particularly in light of the sheer breadth of
records the subpoenas asked IPPA and LES to comb over. In other words, the
discovery that the Plaintiffs were seeking from IPPA and LES could be
considered “unreasonably cumulative or duplicative, or . . . obtainable from
some other source that is more convenient, less burdensome, or less expensive .
. . .” See Ind. T.R. 26(B)(1)(i). Alternatively, it is possible that, “the burden or
expense of the proposed discovery outweighs its likely benefit, taking into
account the needs of the case, the amount in controversy, the parties’ resources,
the importance of the issues at stake in the litigation, and the importance of the
proposed discovery in resolving the issues.” See Ind. T.R. 26(B)(1)(iii). That is
to say, the burden on nonparties IPPA and LES in complying with the
subpoenas would be substantial with little additional benefit to the Plaintiffs in
proving their claims, in light of the evidence the Plaintiffs have already
discovered. Keeping in mind the broad discretion that trial courts enjoy in
ruling on discovery disputes, which requires carefully balancing the
circumstances and equities of each case, we cannot say the trial court here
abused its discretion in denying the Plaintiffs’ motion to compel IPPA and LES
to more completely comply with the subpoenas.5
5
This holding necessarily resolves the Plaintiffs’ argument that they should have been awarded attorney fees
in addition to the granting of the motion to compel.
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II. Reasonableness of Attorney Fees Awarded
[23] Next, we address the Plaintiffs’ argument that IPPA and LES asked for and the
trial court awarded an excessive amount in attorney fees for reviewing and
partially complying with the subpoenas. Additionally, we believe that we
should consider IPPA and LES’s cross-appeal, claiming that they were awarded
too little in fees, in conjunction with this issue. That is to say, the total amount
of attorney fees and other costs awarded to IPPA and LES should be viewed as
a whole, in light of all the facts and circumstances of the case.
[24] We review the amount and reasonableness of an attorney fee award for an
abuse of discretion. Cavallo v. Allied Physicians of Michiana, LLC, 42 N.E.3d 995,
1009 (Ind. Ct. App. 2015). Where the amount of a fee award is not
inconsequential, there must be objective evidence of the nature of the legal
services and the reasonableness of the fee. Id.
[25] An award of attorney fees to a nonparty in connection with a subpoena is
governed by Indiana Trial Rules 34(C)(3) and 37(A)(4). Rule 34(C)(3)
provides:
The [subpoena] shall contain the matter provided in subsection
(B) of this rule. It shall also state that the witness or person to
whom it is directed is entitled to security against damages or
payment of damages resulting from such request and may
respond to such request by submitting to its terms, by proposing
different terms, by objecting specifically or generally to the
request by serving a written response to the party making the
request within thirty (30) days, or by moving to quash as
permitted by Rule 45(B). Any party, or any witness or person
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upon whom the request properly is made may respond to the
request as provided in subsection (B) of this rule. If the response
of the witness or person to whom [a subpoena] is directed is
unfavorable, if he moves to quash, if he refuses to cooperate after
responding or fails to respond, or if he objects, the party making
the request may move for an order under Rule 37(A) with respect
to any such response or objection. In granting an order under
this subsection and Rule 37(A)(2) the court shall condition relief
upon the prepayment of damages to be proximately incurred by
the witness or person to whom the request is directed or require
an adequate surety bond or other indemnity conditioned against
such damages. Such damages shall include reasonable attorneys’
fees incurred in reasonable resistance and in establishing such
threatened damage or damages.
[26] Rule 37(A)(4) in turn states:
If the motion [to compel] is granted, the court shall, after
opportunity for hearing, require the party or deponent whose
conduct necessitated the motion or the party or attorney advising
such conduct or both of them to pay to the moving party the
reasonable expenses incurred in obtaining the order, including
attorney’s fees, unless the court finds that the opposition to the
motion was substantially justified or that other circumstances
make an award of expenses unjust.
If the motion is denied, the court shall, after opportunity for
hearing, require the moving party or the attorney advising the
motion or both of them to pay to the party or deponent who
opposed the motion the reasonable expenses incurred in
opposing the motion, including attorney’s fees, unless the court
finds that the making of the motion was substantially justified or
that other circumstances make an award of expenses unjust.
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If the motion is granted in part and denied in part, the court may
apportion the reasonable expenses incurred in relation to the
motion among the parties and persons in a just manner.
[27] We examined these two provisions in Gonzalez v. Evans, 15 N.E.3d 628 (Ind. Ct.
App. 2014), trans. denied. We held in part, “[n]on-parties subjected to
subpoenas . . . may reasonably be expected to consult with counsel to ensure
compliance with the subpoena without unnecessarily divulging privileged
information or to determine whether there is any legal basis to object to the subpoena.”
Gonzalez, 15 N.E.3d at 637 (emphasis added). We further explained that under
Trial Rule 34(C)(3), a subpoenaed nonparty is entitled to “‘damages . . .
proximately incurred by the witness or person’” and that such damages “may
include attorney fees directly related to complying with a subpoena, regardless
of whether there was a basis for resisting it.” Id. (citing Int’l Bus. Mach. Corp. v.
ACS Human Servs., LLC, 999 N.E.2d 880, 885 (Ind. Ct. App. 2012), trans.
denied).
[28] Here, IPPA submitted documentation regarding the time its lawyers and other
legal professionals spent in relation to the subpoenas. That documentation was
split into three categories: “fees associated with evaluating the subpoenas and
complying with discovery”; “fees from reasonable resistance to the subpoenas”;
and “fees from having to seek recovery for reasonable resistance fees”.
Appellants’ App. Vol. II pp. 93, 95, 97. The time spent on the first category
was 12.5 hours for a total cost of $4,980.50. The time spent on the second
category was 8.4 hours for a total cost of $3,480.00. The time spent on the third
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category was 22.8 hours for a total cost of $5,923.00. The billing rates for the
attorneys representing IPPA, from the large Indianapolis firm of Bose
McKinney & Evans, were $450, $410, and $225 per hour; a paralegal also
worked on the case at a rate of $185 per hour. The trial court only awarded
IPPA its attorney fees related to the first category.
[29] As for LES, which utilized the same attorneys and paralegal as IPPA at the
same hourly rates, it asserted time spent “evaluating the subpoenas [sic] and
complying with discovery” as 7.4 hours at a total cost of $2,572.75. Id. at 167.
As for “reasonable resistance to the subpoenas [sic] and seeking to recover for
reasonable resistance,” it asserted time spent of 17.15 hours at a total cost of
$5,033.00. Id. at 168. Again, the trial court only awarded attorney fees in
relation to the first category.6
[30] The gist of the Plaintiffs’ argument is that IPPA and LES did not need to hire
such expensive attorneys to evaluate and respond to the subpoenas, which they
characterize as routine and not seeking any confidential or privileged
information. When evaluating the reasonableness of an attorney fee award, the
starting point is the hours worked and the hourly rate charged. Cavallo, 42
N.E.3d at 1009. The trial court may consider a number of other factors,
6
The trial court also awarded $1,353.29 to LES in costs for the time its principal—an engineer—spent
responding to the subpoena. The Plaintiffs fail to differentiate this amount in its argument regarding attorney
fees. We conclude they have waived any objection on appeal to this amount for failing to make a cogent
argument as to why it was improper or excessive. See Brazier v. Maple Lane Apartments I, LLC, 45 N.E.3d 442,
451 (Ind. Ct. App. 2015) (citing Ind. Appellate Rule 46(A)(8)), trans. denied.
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including the responsibility of the parties in incurring the attorney fees and the
judge’s personal expertise and knowledge. Id. In addition, a court may
consider the factors listed in Indiana Professional Conduct Rule 1.5(a)
governing the reasonableness of a fee for disciplinary purposes, but it is not
required to expressly do so.7 Id. at 1009-10.
[31] We first reject the Plaintiffs’ suggestion that under Trial Rule 34(C)(3) and
Gonzalez, a nonparty is only entitled to attorney fees with respect to evaluating
whether a subpoena is seeking confidential or otherwise sensitive information.
Although that was indeed the type of information sought in Gonzalez, as well as
in the IBM case upon which Gonzalez relied, we also stated that attorney
consultation by a nonparty was permissible “to determine whether there is any
legal basis to object to the subpoena.” Gonzalez, 15 N.E.3d at 637 (emphasis
added). As discussed in Part I of this opinion, overbreadth and undue burden
upon a nonparty are two such legal bases for objecting to a subpoena. IPPA
7
Those factors are:
(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill
requisite to perform the legal service properly;
(2) the likelihood, if apparent to the client, that the acceptance of the particular employment will
preclude other employment by the lawyer;
(3) the fee customarily charged in the locality for similar legal services;
(4) the amount involved and the results obtained;
(5) the time limitations imposed by the client or by the circumstances;
(6) the nature and length of the professional relationship with the client;
(7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and
(8) whether the fee is fixed or contingent.
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and LES were entitled to have their attorneys review the broad subpoenas they
received before expending substantial time and effort attempting to comply with
them. They also were entitled under Trial Rule 34(C)(3) to recover attorney
fees from the Plaintiffs related to that review and their partial compliance with
the subpoenas.
[32] We also cannot say that counsel for IPPA and LES spent an inordinate or
unreasonable amount of time evaluating the subpoenas and facilitating partial
compliance with them. Again, about 12.5 hours was spent with respect to the
two subpoenas sent to IPPA and 7.4 hours on the one subpoena sent to LES.
In other words, approximately three work days were spent on three lengthy and
detailed subpoenas. This amounts to roughly one day of work on each of them,
which does not seem outlandish.
[33] The hourly rate charged here is undoubtedly at the high end of the scale. IPPA
and LES chose to employ some of the most highly-paid attorneys at one of the
largest firms in Indiana to review the subpoenas. Combining the hourly rates of
all the attorneys and the paralegal who worked on the subpoenas, IPPA was
charged $398.44 per hour with respect to its subpoenas and LES was charged
$347.67 per hour with respect to its subpoena. Those rates, while high and
which include a maximum charge of $450 per hour, do not appear in our
experience and knowledge to be out-of-line with rates charged by experienced
partners at large Indianapolis firms. As for the Plaintiffs’ contention that less-
experienced, less-expensive attorneys or paralegals should have spent the bulk
of the time on these subpoenas, we disagree. Given the sheer volume of
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information sought by the subpoenas in relation to a novel underlying case in
which IPPA and LES undoubtedly were interested, if not actually parties to, we
see nothing wrong with their having chosen whom they believed to be the best
attorneys possible to review the subpoenas.
[34] In support of their argument that the fees here were excessive, the Plaintiffs cite
Order for Mandate of Funds Montgomery County Council v. Milligan, 873 N.E.2d
1043 (Ind. 2007). In that case, a law firm for trial judges who successfully
sought a mandated increase in their employees’ pay submitted an invoice for
fees and expenses totaling $128,300. The most highly-paid attorney who
worked on the case charged $320 per hour. Our supreme court held that the
firm could only collect $72,810.29. It based this reduction on several factors,
including a much-lower normal hourly rate for attorneys in Montgomery
County than in the Indianapolis area, where the firm was located, the issues in
the case were fairly straightforward and did not require excessive legal work,
and the fact that the fees sought were substantially more than the total amount
of pay increases obtained by counsel, or $85,000. Milligan, 873 N.E.2d at 1049-
50.
[35] Milligan does not require us to find that the fees here are unreasonable. As for
the difference between $320 and $450 per hour, we note that Milligan was
decided over ten years ago. Also, the hourly rate there was found excessive in
part based on the much lower rates in rural Montgomery County. Here, all of
the litigation involved parties or entities in Indianapolis or immediately
surrounding counties that are part of the metropolitan area. There also is no
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recovered judgment with which to compare the approximately $7,500 in
attorney fees awarded to IPPA and LES as there was in Milligan; regardless,
their entitlement to those fees is clearly set forth by our trial rules and caselaw.
[36] We are aware that IPPA and LES are substantively aligned with the
Defendants here; a judgment in favor of the Plaintiffs could substantially and
negatively impact the pork CAFO industry in Indiana. Thus, IPPA and LES
were not necessarily inclined to automatically and fully comply with the
Plaintiffs’ subpoenas. But they were within their legal rights in not doing so
and in hiring counsel of their choice to review the subpoenas to determine if
there was any legal basis for resisting them. They also were within their legal
rights to seek recovery of attorney fees as nonparties being asked to expend
considerable time and effort responding to the subpoenas. The fees awarded to
IPPA and LES are not excessive or unreasonable.
[37] On the other hand, we also reject IPPA and LES’s cross-appeal contention that
they were entitled to the full amount of the fees they sought because they
reasonably resisted the subpoenas, as expressly found by the trial court. IPPA
and LES argue that once the trial court made such a finding, it was required to
award them all attorney fees related to resisting the subpoenas and seeking fees
on fees related to resisting.
[38] Trial Rule 34(C)(3) expressly states that, if a trial court grants a motion to
compel discovery from a nonparty, the order compelling discovery “shall” be
conditioned upon the moving party prepaying damages to the nonparty or
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obtaining a surety bond or other indemnity against such damages, and that
“[s]uch damages shall include reasonable attorneys’ fees incurred in reasonable
resistance . . . .” (Emphasis added). The rule is silent as to what happens if the
trial court denies a motion to compel, as happened here. In such a case, the
express guidance for awarding attorney fees is found solely in Trial Rule
37(A)(4), which provides that the trial court shall order the moving party or the
moving party’s attorney or both of them to pay attorney fees to the other side,
“unless the court finds that the making of the motion was substantially justified
or that other circumstances make an award of expenses unjust.”8
[39] We also note the following observation we made in IBM:
Thus, Trial Rule 34(C)(3) does not by its plain language require
that the trial court order payment for all damages a non-party
might incur. To hold as much, absent an express statement in
the Rule requiring such a conclusion, would be to undermine the
trial court’s exercise of discretion in discovery matters. Thus,
ACS was not as a matter of law entitled to full compensation of
all its costs and fees by operation of Trial Rule 34(C) alone.
IBM, 999 N.E.2d at 890. We proceeded to hold that the trial court did not
abuse its discretion in reducing by one-half ACS’s undisputed expenses incurred
8
At first glance, it may seem illogical to guarantee “reasonable resistance” damages to a nonparty if a motion
to compel is granted but not if it is denied. We believe the difference can be explained by the fact that the
party seeking discovery receives a definitive benefit if a motion to compel is granted, counterbalanced by fees
to the nonparty for any “reasonable resistance,” whereas there is no benefit to the party if the motion to
compel is denied and there is also a strong possibility, but not guarantee, that it also will have to pay attorney
fees to the nonparty. In any case, that is the plain language of Rules 34(C)(3) and 37(A)(4).
Court of Appeals of Indiana | Opinion 32A01-1703-PL-612 | February 14, 2018 Page 28 of 30
in reviewing and complying with those requests, out of concerns for “general
equity.” Id. at 891.
[40] The trial court here found that it “would be unjust under these circumstances”
to award additional attorney fees to IPPA and LES, also suggesting that the
Plaintiffs themselves had substantial justification for filing their motion to
compel. Appellant’s App. Vol. II p. 27. It also would not be improper to note
that the Plaintiffs are individual homeowners represented by a public interest
law firm, while IPPA and LES are businesses in close relation to the
Defendants who felt comfortable hiring some of the most expensive lawyers in
the state to address the subpoenas and who already were awarded
approximately $7,500 in attorney fees related to the subpoenas, which resulted
in minimal document production to the Plaintiffs. In other words, looking at
all the facts and circumstances surrounding the discovery dispute between the
Plaintiffs and IPPA and LES, it is apparent the trial court split the baby by
awarding IPPA and LES some of the attorney fees it sought, but not all of
them. The trial court had broad equitable discretion to fashion such a remedy,
which is not in direct conflict with any trial rule. It did not abuse that discretion
in refusing to award more attorney fees to IPPA and LES.
Conclusion
[41] The trial court did not abuse its discretion in denying the Plaintiffs’ motion to
compel and in awarding $7,553.25 in attorney fees to IPPA and LES. On cross-
appeal, the trial court also did not abuse its discretion in refusing to award
additional attorney fees to IPPA and LES. We affirm in all respects.
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[42] Affirmed.
May, J., and Bradford, J., concur.
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