Indiana Court Decisions: Dec. 29, 2022-Jan. 11, 2023

7th Circuit Court of Appeals

Jan. 9

Mark A. Warsco, trustee in the bankruptcy of Isiah T. Harris v. Creditmax Collection Agency, Inc.

22-1733

7th Circuit revives bankruptcy collections dispute, overturns little-used ‘transfer’ precedent

The 7th Circuit Court of Appeals has revived a bankruptcy collections dispute, remanding the case to resolve a trustee’s petition to recover funds paid to a creditor. In doing so, the appellate court overturned a 39-year-old precedent that has been rarely cited in as many years.

The 7th Circuit ruled in the case of Mark A. Warsco, trustee in the bankruptcy of Isiah T. Harris v. Creditmax Collection Agency, Inc., 22-1733, after accepting jurisdiction and bypassing the district court.

At issue was the roughly $3,700 Isiah Harris had paid to Creditmax during the 90 days before he filed for bankruptcy.

According to the opinion, “Creditmax holds a judgment against Harris and used it to secure a garnishment order, which required Harris’s employer to pay some of his wages directly to Creditmax.”

A state court had issued the garnishment order before the 90-day period outlined in 11 § U.S.C. 547(b)(4)(A) had begun. Warsco tried to recover the $3,700 for distribution among Harris’ creditors, but without preference to Creditmax.

Creditmax resisted and relied on In re Coppie, 728 F.2d 951 (7th Cir. 1984), which defines “transfer” for the purpose of §547 as dependent on state law. Indiana law defines “transfer” as when a garnishment order is entered, not paid.

The federal bankruptcy court, standing by Coppie, denied the trustee’s application to recover the funds paid to Creditmax. But the 7th Circuit reversed, overruling Coppie based on Barnhill v. Johnson, 503 U.S. 393 (1992). Under Barnhill, a “transfer” occurs when money actually changes hands.

Judge Frank Easterbrook noted that the 1995 case of Freedom Group, Inc. v. Lapham-Hickey Steel Corp., 50 F.3d 408 (7th Cir.), overruled several decisions that did not comport with Barnhill. Coppie, however, was not among those decisions — likely because Coppie had not been cited by the 7th Circuit “since its release 39 years ago.”

“Creditmax tries to distinguish Barnhill and Freedom Group on the ground that they dealt with dates on which people learned of transfer offers (for example, the date on which a check arrived in the mail) rather than the dates the orders were made or took effect,” Easterbrook wrote. “Yet the rationale of Barnhill does not depend on a payment order’s entry versus the date any given person learned of it. Under Barnhill, both dates are irrelevant to the ‘transfer.’”

Thus, the 7th Circuit remanded the case to resolve the trustee’s claim on the merits.

Indiana Supreme Court

Jan. 4

Indiana Office of Utility Consumer Counselor, Citizens Action Coalition of Indiana, Inc., Vote Solar, Environmental Law & Policy Center, Solarize Indiana, Inc., Solar United Neighbors, and Indiana Distributed Energy Alliance v. Southern Indiana Gas and Electric Company and Indiana Utility Regulatory Commission

22S-EX-00166

Justices reinstate Vectren’s ‘instantaneous netting’ method for crediting excess energy production

The Indiana Supreme Court has ruled in favor of Vectren energy and against the Indiana Office of Utility Consumer Counselor, finding Vectren followed state law when it changed its method of determining the credit its customers receive when producing excess solar and wind energy.

The case involves Southern Indiana Gas and Electric Company — also known as Vectren, now known as CenterPoint Energy — which petitioned the Indiana Utility Regulatory Commission for approval of a new “instantaneous netting method” that determines the amount of credit its customers receive for their excess distributed generation, or DG, of electricity.

In 2017, the Indiana General Assembly had offset the subsidizing cost placed upon the non-DG customers by enacting the Distributed Generation Statutes, Indiana Code § 8-1-40, et seq.

The net effect of the legislative reforms was that DG customers now get “a fraction of the credit they enjoyed under the old net metering rules,” according to the Supreme Court.

In May 2020, Vectren filed a petition with the commission seeking approval of a tariff rate, known as the “Rider EDG,” for the procurement of excess DG under I.C. 8-1-40. The Rider EDG measures the difference between the electricity supplied to Vectren by the customer and the electricity the customer supplies to Vectren within a fraction of a second.

The OUCC and intervenors challenged Vectren’s instantaneous calculations, alleging Vectren does not measure excess DG in compliance with I.C. 8-1-40-5. Section 5 defines “excess distributed generation” as the difference between the electricity supplied to a DG customer from a utility, or the inflow, and the electricity the DG customer supplies back to a utility, the outflow.

The IURC investigated whether Vectren’s Rider EDG satisfied the Distributed Generation Statutes. Ultimately, it found the instantaneous netting method was consistent with Indiana Code and approved the Rider EDG.

The OUCC and intervenors appealed, arguing the commission erred in holding Vectren’s instantaneous netting was in accordance with I.C. 8-1-40-5.

In January 2022, the Court of Appeals of Indiana reversed the IURC’s finding, rejecting Vectren’s instantaneous netting method by finding it focuses and assigns credit based only on the outflow of electricity rather than the specified difference between inflow and outflow.

The Court of Appeals deferred to the monthly billing period, reasoning a longer period to find the difference between inflow and outflow was more beneficial to the customers.

Upon review by the Indiana Supreme Court, justices found two major errors by the Court of Appeals and reinstated the IURC’s ruling.

First, justices wrote that the COA viewed Vectren’s instantaneous netting method as “competing energies behind the meter, and the dominant force is subject to one allocation.”

“Yet, Vectren’s meters compute the difference of the inflow and outflow at an instant in time, thus providing the most accurate reading possible while complying with the plain language of the statute,” Justice Mark Massa wrote. “While the instantaneous meters can measure electricity in either direction, electricity only flows in one direction through the meter and is measured on an instantaneous basis. In other words, there is either an inflow of power to the DG customer or an outflow of power to the utility company, unless the meter measures at zero, which reflects a customer’s outflow matching its inflow of distributed generation.”

Second, the justices found the lower appellate court incorrectly deferred to the monthly billing period.

“… (T)he current Distributed Generation Statutes do not direct utilities on how often excess distributed generation must be measured,” Massa wrote. “The statute does not mandate a specific time when the difference between inflow and outflow must be measured. As a result, the Commission, acting within its legal authority and technical expertise, recognized technology has changed and so too can the timing of when the difference between inflow and outflow of energy be calculated.”

Chief Justice Loretta Rush and Justice Geoffrey Slaughter concurred while Justice Christopher Goff concurred in result but did not offer a separate opinion.

Justice Derek Molter did not participate, as he was originally an attorney working on the case with Ice Miller LLP.

The case is Indiana Office of Utility Consumer Counselor, Citizens Action Coalition of Indiana, Inc., Vote Solar, Environmental Law & Policy Center, Solarize Indiana, Inc., Solar United Neighbors, and Indiana Distributed Energy Alliance v. Southern Indiana Gas and Electric Company and Indiana Utility Regulatory Commission, 22S-EX-00166.

Court of Appeals of Indiana

Dec. 30

Tonia Land, individually and on behalf of all others similarly situated v. IU Credit Union

22A-CP-382

COA reverses for woman who filed overdraft class action against IU Credit Union

A woman who had her class-action complaint against IU Credit Union sent to arbitration has secured a reversal in an interlocutory appeal.

Tonia Land sued IUCU on behalf of a putative class in March 2021, claiming IUCU had wrongfully assessed overdraft fees against her and other customers. IUCU moved to compel arbitration, arguing Land had already agreed via contract that her claims would be addressed out of court.

Land has several accounts with IUCU, including a checking account with a debit card. When she became an IUCU customer, she received a “Membership & Account Agreement.”

Among other provisions, the agreement discusses IUCU’s methods for processing Land’s expenditures from her account, as well as overdrafting policies. Land later registered for online banking, and according to the “Online Banking, Mobile Banking and Text (SMS) Message Banking Agreement and Disclosure,” she agreed IUCU could send notices to her electronically.

In 2019, IUCU sought to require its members to arbitrate any claims they may have against IUCU and to waive their right to participate in class actions against IUCU.

The credit union prepared a one-page “addendum to membership & account agreement” to customers, which provided that (1) either party may require any dispute to be resolved by arbitration without the other party’s consent, and (2) Land and other customers cannot initiate or join a class action in any arbitration or court proceeding between the parties.

Further, the addendum stated, “You have the right to opt out of this agreement to arbitrate if You tell Us within 30 days of the opening of Your account or the receipt of this notice, whichever is later. … Otherwise, this agreement to arbitrate will apply without limitation.”

IUCU attempted to mail the addendum to each member, which was enclosed at the end of their July 2019 account statement. IUCU also attempted to email IUCU members to inform them about the addendum.

For Land, IUCU mailed the addendum to the address she had given the credit union, along with an account statement. However, the addendum was included in an account statement for an account other than Land’s checking account.

Further, IUCU claimed to have sent Land an email stating: “You have a new eStatement to retrieve in Online Banking.”

Land did not recall receiving that email, but the language is identical to other notifications she receives when a new monthly banking statement is available for review.

In March 2021, Land filed a class-action complaint alleging IUCU had wrongfully assessed overdraft fees on accounts that were not overdrawn. She further claimed that IUCU’s actions amounted to breach of contract, breach of a duty of good faith and fair dealing, unjust enrichment and violation of Indiana’s Deceptive Consumer Sales Act.

The Monroe Circuit Court granted IUCU’s motion to compel arbitration, but an interlocutory appeal ensued, with Land arguing the purported agreement to arbitrate was invalid.

The Court of Appeals of Indiana agreed with Land, reversing in Tonia Land, individually and on behalf of all others similarly situated v. IU Credit Union, 22A-CP-382.

First, the COA concluded IUCU failed to provide reasonable notice to Land of the arbitration contract. The appellate panel compared the Land case to Kortum-Managhan v. Herbergers NBGL, 204 P.3d 693 (Mont. 2009).

“KM denied receiving or noticing the change in terms, because the credit card company regularly included ‘junk mail’ with her account statements,” Senior Judge John Baker wrote. “As a result, KM reasoned she did not receive meaningful notice of the arbitration provision.

“… The Kortum-Managhan case and Land’s case are similar in several crucial respects,” Baker wrote. “KM and Land both asserted that they did not see the arbitration terms that were offered to them. And IUCU’s notice on the first page of the account statement it mailed to Land did not advise her that the ‘added language’ included an arbitration provision or that time-sensitive action on her part was necessary to avoid being bound by the new language.

“… In addition, in both cases the financial institution did not require affirmative action by the customer to be bound by the new contract,” Baker continued. “KM supposedly agreed to be bound merely by continuing to use her credit card, and IUCU stated that Land’s silence would equal assent to the new terms. Finally, in both cases, customers were not reasonably notified that they were being asked to waive their right to jury trial against their financial institutions.”

While the first conclusion was a sufficient basis to reverse the trial court’s judgment, judges also addressed Land’s claim that she did not validly accept IUCU’s contract offer.

“…. IUCU’s offer did inform Land of how she could opt out of the Addendum’s arbitration requirements. But, as the Restatement shows, it is not enough for the offeror to inform the offeree that silence will equal acceptance of the offer,” Baker wrote. “It must also be shown that the offeror, in remaining silent, intended to accept the offer. … Land told the trial court that she was never aware of the offer and would not have accepted it. Further, IUCU does not demonstrate that it relied on Land’s silence in continuing to do business with her.

“… IUCU cites Weldon v. Asset Acceptance, LLC, 896 N.E.2d 1181 (Ind. Ct. App. 2008), trans. denied, in support of its claim that Land’s silence equaled acceptance of its offer, but that case is distinguishable,” Baker concluded.

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Jan. 6

Kory Easterday v. Amber (Easterday) Everhart

22A-DC-1510

COA: Trial court erred by forbidding father’s discussion of religion with child

The Court of Appeals of Indiana has reversed a trial court’s custody order barring a father from discussing religion with his daughter.

Kory Easterday and Amber Everhart were married when their child, Ka.E., was born in August 2010. In July 2012, Amber filed for divorce, and two months later the trial court issued an order accepting the parties’ settlement agreement and granting dissolution of the marriage.

Pursuant to their agreement, the parties would share joint legal custody and Everhart would be Ka.E.’s primary physical custodian. At the time, Easterday lived in Greenwood and Everhart lived in Brownstown.

In March 2022, Everhart filed a petition to modify parenting time. The Jackson Superior Court held a hearing on the petition, during which the parties presented evidence and testimony about their different views regarding their child’s religious upbringing.

Everhart testified she and her family, including Ka.E., had begun attending an apostolic Christian church in Seymour, with the child attending church three times a week. Also, Ka.E. had been baptized without Easterday’s knowledge.

For his part, Easterday testified to being agnostic, and Everhart said she wanted the trial court to modify the parenting time “to eliminate [Father’s] ability to question [Child’s] religion or try to talk [Child] into believing that there is no God[.]”

Easterday denied telling his child “there wasn’t a God.” He also said he had not tried to “convince (Ka.E.) the church she goes to isn’t something she should be attending,” and that he wanted his daughter “to make her own choice” about religion.

The trial court addressed the religion issue in its June order, writing, “The Court having considered the evidence and in-camera interview, finds that [Child] has made an independent well reasoned decision about her faith, which should be respected and encouraged. The Court finds that to allow [Child] to pursue and express her faith, that [Mother] should have sole legal custody of [Child] as well as primary physical custody. [Father] shall not discuss religion with [Child].”

At the Court of Appeals, judges concluded the trial court erred when it awarded Everhart sole legal custody of Ka.E. based solely on the child’s desire to “pursue and express her faith,” and also in forbidding Easterday from discussing religion with his child.

“Here, the trial court’s modification of legal custody in favor of Mother was based entirely on religion — Child expressed an interest in participating in religious activities at a church she attended with Mother,” Judge Melissa May wrote. “The trial court did not make a finding regarding, nor can we locate in the record, another substantial change in circumstances to warrant a change in legal custody. Therefore, we conclude the trial court erred when it awarded Mother sole legal custody of Child based solely on Child’s desire to ‘pursue and express her faith[.]’”

Regarding Easterday’s free speech rights, the COA again sided with him.

“Even if Child reported during the in-camera interview that Father was disparaging her religious views and telling her there was no God, the trial court’s total prohibition of Father’s right to discuss religion with Child is not narrowly tailored to further the State’s compelling interest in protecting Child’s welfare,” May wrote. “There are likely many topics related to religion that Father could discuss with Child without causing harm to Child, including support for her decision to express and pursue her faith.

“With the trial court’s order as it is, Father can neither encourage Child’s faith nor encourage her to learn about how other people may believe and worship so that she grows up to be an educated citizen of our pluralistic country. Therefore, we hold the trial court’s order totally prohibiting Father from discussing religion with Child violated his right to free speech under the First Amendment,” May concluded.

The case is Kory Easterday v. Amber (Easterday) Everhart, 22A-DC-15-10.

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Jan. 9

Dustin Passarelli v. State of Indiana

22A-CR-1116

Split COA affirms Army vet can’t call psychologist to testify about PTSD in murder case

A U.S. Army combat veteran who was stationed at Fort Hood, Texas, on the day of the 2009 mass shooting cannot call a psychologist to testify about his post-traumatic stress disorder in his murder trial, the Court of Appeals of Indiana has ruled. A dissenting judge, however, pointed to legal scholarship on the use of a PTSD diagnosis in “mental status defense” cases.

A split Court of Appeals affirmed on interlocutory appeal the Marion Superior Court’s decision not to allow a psychologist’s testimony about Dustin Passarelli’s PTSD, finding self-defense claims are analyzed from the standpoint of a “reasonable person,” and what constitutes an “ordinary man” doesn’t change on a case-by-case basis.

In February 2019, Passarelli was driving southbound on Interstate 465 when the driver of a “red car flew up behind him” with its lights flashing and horn honking. Passarelli heard a “bang” and followed the car, driven by Mustafa Ayoubi, off the 38th Street exit in Indianapolis to a nearby apartment complex, thinking his vehicle had been struck.

After stopping, Ayoubi exited his vehicle and approached Passarelli, who was still in his car, and the two got into an argument.

The argument escalated, with both sides claiming the other used anti-Muslim and antisemitic language. At some point, Passarelli threatened to shoot Ayoubi.

As the argument continued to escalate, Ayoubi made a fist with his hand, appearing as if he was about to punch Passarelli’s driver’s side window.

In response, Passarelli drew a 9mm handgun and shot multiple times through his window, striking Ayoubi in the shoulder and then several times in the back as he was running away.

After shooting Ayoubi, Passarelli moved his vehicle, called 911 and administered CPR to Ayoubi. Another resident in the apartment complex ran to the scene and “took over CPR” until the police arrived.

Law enforcement determined there was no “damage whatsoever to the outside” of Passarelli’s vehicle, but the window was shattered from the gunfire.

Ayoubi was pronounced dead shortly after officers arrived. An autopsy revealed he had been shot once in the shoulder from the front and seven times in the back.

The state charged Passarelli with murder on Feb. 21, 2019.

John Mundt, Ph.D., conducted a psychological evaluation of Passarelli at the Marion County Jail four months later.

During the evaluation, Mundt learned that Passarelli had enlisted in the Army in April 2009, trained as a medic, and was stationed at Fort Hood, Texas, when an Army psychiatrist killed 13 soldiers on the base and wounded more than 30 others.

As a trained medic, Passarelli helped provide emergency medical care after the shooting and recalled the event as “terrifying.” Passarelli was then deployed to Iraq, where he experienced a “high level of combat exposure.”

Passarelli was dismissed from the Army in May 2012 with an “other-than-fully-honorable discharge” after fighting with a fellow soldier.

After his discharge, Passarelli was rated by the Department of Veterans Affairs as 70% disabled based on a PTSD diagnosis as well as multiple medical conditions incurred during his service with the Army. He sought mental health treatment through the VA Medical Center, but his treatment history was described as “erratic.”

Mundt concluded, “Passarelli’s description of his behavior at the time of the … (Ayoubi) shooting strongly suggests that he reacted to what he perceived as a severe threat.” He also concluded Passarelli’s military training ensured that he “responded with significant force.”

Passarelli filed witness and exhibit lists in preparation for trial and listed Mundt as an “expert of PTSD.” During a later hearing on the admissibility of Mundt’s testimony, Passarelli’s counsel acknowledged that while a formal notice of self-defense had not been filed with the court, it was nonetheless a “self-defense case.”

The trial court, however, summarily ruled that Mundt’s anticipated testimony was inadmissible, so Passarelli filed a motion to certify the matter for a discretionary interlocutory appeal.

The COA accepted jurisdiction over the interlocutory appeal, and the majority affirmed the trial court.

Relying on Wilson v. State, 697 N.E.2d 466 (Ind. 1998), while also looking at Higginson v. State, 183 N.E.3d 340 (Ind. Ct. App. 2022), the majority concluded that the ”evidence does nothing to show that Passarelli’s actions were objectively reasonable.”

“The objective component of self-defense, as adopted by our courts, is analyzed from the standpoint of an ordinary ‘reasonable person,’” Chief Judge Robert Altice wrote for the majority. “… Thus, the question being presented to the jury is whether an ordinary reasonable person would have responded with deadly force if confronted with the same circumstances that Passarelli confronted.

“The issue is not whether a person just like Passarelli — who also suffers from PTSD caused by military combat — would have responded as Passarelli did,” Altice continued. “In short, the standard of what constitutes an ‘ordinary man’ does not change on a case-by-case basis.

“We therefore conclude that the trial court did not abuse its discretion in determining that Dr. Mundt’s anticipated testimony is inadmissible at trial to support Passarelli’s claim of self-defense,” the majority concluded.

Altice was joined by Judge Elizabeth Tavitas in the majority while Judge Elaine Brown dissented with a separate opinion.

In her dissent, Brown wrote she would favor a determination that Passarelli may elicit testimony from Mundt to a person’s reasonable belief that he was under threat of imminent harm given his PTSD. She added, however, that Mundt “may not testify as to an ultimate factual determination such as to whether Passarelli was reasonable in using justifiable force.”

Quoting a 2010 article from the Indiana Law Journal — “Last Stand? The Criminal Responsibility of War Veterans Returning from Iraq and Afghanistan with Posttraumatic Stress Disorder” — Brown wrote, “… (W)ith associated studies confirming the validity of the PTSD diagnosis and the genuine impact of PTSD on the behavior of veterans, greater weight may be given to the premise that PTSD is a mental disorder that provides grounds for a ‘mental status defense,’ such as insanity, a lack of mens rea, or self-defense. Although considerable obstacles remain, given the current political climate, Iraq and Afghanistan War veterans are in a better position to successfully pursue these defenses than Vietnam War veterans were a generation ago, a development that may make these defenses more available for all defendants with a PTSD diagnosis.”

“In my view,” the dissent concluded, “the jury should be entrusted to assess Dr. Mundt’s testimony together with the other evidence presented at trial.”

The case is Dustin Passarelli v. State of Indiana, 22A-CR-1116.

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Jan. 11

Illinois Casualty Company v. B&S of Fort Wayne, Inc., Showgirl III, Inc., Reba Enterprises LLC, Jessica Burciaga, Jessica Hinton, Jamie Middleton Eason, Lucy Pinder, Abigail Ratchford, Emily Scott, Denise Trlica, Sara Underwood, Jennifer Walcott Archuletta, Paola Canas, Camila Davalos, Mariana Davalos, Jaime Edmondson, Cielo Jean Gibson, Hillary Hepner, Krystal Hipwell, Melanie Iglesias, Joanna Krupa, Arianny Celeste Lopez, Brooke Marrin, Ursula Mayes, Carrie Minter, Anya Monzikova, Andra Cheri Moreland, Caitlin O’Connor, Lina Posada, Laurie Romeo, Ina Schnitzer, Cora Skinner, Alana Souza, Irina Voronian, Jennifer Zharinova, and Rachel Koren

22A-PL-432

Models in photo dispute lose battle to compel insurance company to arbitration

An attempt by a group of models to force an insurance company into arbitration was blocked by the Court of Appeals of Indiana but ignited a dispute among the appellate judges over how fully the bench should address the arguments raised.

A group of 33 professional models from around the world sued Insured Clubs, which owns two strip clubs in Fort Wayne, for using their photographs in advertisements without their permission. The ads were posted on social media between December 2014 and October 2020.

In October 2020, the models sued Insured Clubs in the U.S. District Court for the Northern District of Indiana. Illinois Casualty Company, which provided the insurance policies for Insured Clubs, denied coverage and refused to defend the clubs.

Insured Clubs and the models were then able to reach to a settlement agreement in which the club owners agreed a consent judgment for $1.92 million. Insured Clubs agreed to pay $177,825 and then assigned their rights against Illinois Casualty Company and other insurance companies to the models for the remainder of the judgment.

However, before the consent judgment was approved by the district court, Illinois Casualty filed a declaratory judgment action against Insured Clubs and the models in Allen Superior Court.

The insurance company claimed its policies, including the cyber protection endorsement, did not provide coverage. Insured Clubs and the models responded by filing a motion to compel arbitration, which relied on the arbitration provision in the cyber protection endorsement. They asserted the arbitration provision was broad and “the scope of claims within the ambit of arbitration are for the arbitrators, and not the Court, do decide in the first instance.”

Illinois Casualty countered the models could not compel arbitration, in part because the cyber protection endorsement and coverage did not apply to this matter.

Allen Superior Court granted the motion to dismiss Insured Clubs from the lawsuit as well as the motion to compel arbitration. The trial court found, in part, that all the models were entitled to present their dispute to the arbitrator even though the arbitration provision applied to only some of the policies.

Following an Appeals on Wheels argument, the Court of Appeals disagreed and reversed in Illinois Casualty Company v. B&S of Fort Wayne, Inc., Showgirl III, Inc., Reba Enterprises LLC, Jessica Burciaga, Jessica Hinton, Jamie Middleton Eason, Lucy Pinder, Abigail Ratchford, Emily Scott, Denise Trlica, Sara Underwood, Jennifer Walcott Archuletta, Paola Canas, Camila Davalos, Mariana Davalos, Jaime Edmondson, Cielo Jean Gibson, Hillary Hepner, Krystal Hipwell, Melanie Iglesias, Joanna Krupa, Arianny Celeste Lopez, Brooke Marrin, Ursula Mayes, Carrie Minter, Anya Monzikova, Andra Cheri Moreland, Caitlin O’Connor, Lina Posada, Laurie Romeo, Ina Schnitzer, Cora Skinner, Alana Souza, Irina Voronian, Jennifer Zharinova, and Rachel Koren, 22A-PL-432.

All three judges on the appellate panel agreed the models with pre-2016 claims were not entitled to arbitration because the cyber protection endorsement was not included on the policies before that time.

However, the judicial trio split on the ruling concerning the models with claims from 2016 and later.

In reviewing arguments, the majority did a close examination of the cyber protection endorsement’s arbitration provision. The majority looked at the language and found that while the first sentence of the provision is broad, the third sentence limited the arbitrator to only deciding disputes “concerning the application or interpretation of this (cyber protection endorsement).”

“Under the trial court’s interpretation, we would be required to ignore the limitations on arbitration set forth in the third sentence. Reading the Cyber Protection Endorsement as a whole, we conclude that the arbitration provision clearly and unambiguously applies only to claims brought under the Cyber Protection Endorsement” Judge Elizabeth Tavitas wrote for the majority, citing State, ex rel. Carter v. Philip Morris Tobacco Co., 879 N.E.2d 12312, 1215, (Ind. Ct. App. 2008), trans. denied.

Judge Terry Crone wrote a concurring opinion specifically to counter the majority’s approach to the 2016 and later claims.

In a footnote, the majority maintained that to resolve the dispute between the models and the insurance company, the court needed to address the models’ argument that the arbitration provision applies to any claim and not just those brought under the cyber protection endorsement. However, Crone described the five paragraphs devoted to the issue as “pure dicta.” He asserted the court did not have to address that argument.

“All anyone needs to know about the Cyber Protection Endorsement,” Crone wrote, “is that it is a ‘claims made’ coverage and that the Models made no claims during the coverage period, and thus the arbitration provision does not apply. Full stop.”•