Indiana Court Decisions: Feb. 9-21, 2023

7th Circuit Court of Appeals

Feb. 17

United States of America v. Daquwon Richardson

22-1690

7th Circuit affirms conviction, 15-year sentence for unlawful firearm possession

The 7th Circuit Court of Appeals has affirmed a man’s unlawful possession of a firearm conviction and sentence after a gun was found in his vehicle during a traffic stop.

Indianapolis police stopped Daquwon Richardson for a traffic violation and, while searching his vehicle, found a gun. Richardson has three felony convictions, meaning he couldn’t lawfully possess the gun.

The 15-year sentence Richardson received for unlawful possession of a firearm is the mandatory minimum under the Armed Career Criminal Act.

Richardson asked the 7th Circuit to overturn the jury’s verdict or vacate his sentence, but the court affirmed the decision. However, the court did modify the judgment to reflect that Richardson’s conviction was by a jury — the district court’s judgment incorrectly states that he pleaded guilty.

On appeal, Richardson argued the government’s evidence was insufficient to support his conviction for firearm possession.

Without DNA, eyewitnesses or other evidence of actual possession, the government proceeded on a constructive possession theory, focusing on whether Richardson “had both the power and intention to exercise dominion and control over the firearm.”

The government’s evidence included that Richardson was the driver and only person in the car. Police searched the car after Richardson initially gave false names, which is when officers found a gun beneath the passenger seat. He also said, “That gun’s not mine,” when police asked if he had a firearms license before telling him they had found the gun.

Also, on jail calls with his girlfriend, who owned the gun, Richardson said the gun was “in the same place that it’s always in.”

Judge Thomas Kirsch wrote in the 7th Circuit opinion that it was “entirely reasonable” for the jury to conclude Richardson constructively possessed the gun.

Richardson also argued the district court shouldn’t have considered his three prior convictions as being separate from one another. The Armed Career Criminal Act applies if a person has three or more prior convictions for violent felonies “committed on occasions different from one another.”

When he was 16, Richardson and an accomplice committed a series of armed robberies in Indianapolis at two CVS locations and at a Dollar General. The first robbery occurred at 4:48 a.m. on Dec. 31, 2011, the second robbery was at 6:03 a.m. the same day and the third robbery was at 7:26 p.m. the next day.

Kirsch wrote there is no “colorable argument” that the second and third robberies occurred on the same occasion, given the 36-hour gap between them. And even though the first two robberies were closer in time, there was still more than an hour between them, and they occurred 12 miles apart.

“With a meaningful gap in time and space between them and notwithstanding the similarities in victim, perpetrators, and methodology, all three robberies were ‘committed on occasions different from one another,’” Kirsch wrote in affirming the district court’s application of the Armed Career Criminal Act.

Richardson also argued that his age at the time of the robberies should affect the act’s applicability to his case, but Kirsch called that “meritless.”

Finally, Richardson argued the district court erred in applying a two-level enhancement for obstruction of justice when determining his guidelines range. The 7th Circuit noted he received the mandatory minimum, so any guidelines error was “harmless.”

The case is United States of America v. Daquwon Richardson, 22-1690.

Court of Appeals of Indiana

Feb. 10

Tyson Eminger v. State of Indiana

22A-CR-1077

COA remands for reexamination of criminal cash forfeiture

The Court of Appeals of Indiana has ordered a trial court to reexamine a criminal forfeiture after granting the defendant’s motion for relief from the forfeiture, then granting the state’s motion reinstating it.

In 2017, the Noble County Sheriff’s Office suspected Tyson Eminger of being a supplier of methamphetamine out of his home in Kendallville. With a search warrant, officers entered Eminger’s residence and seized meth, paraphernalia and $4,260.

Eminger was then charged with Level 2 felony dealing in meth, Level 4 and 6 felony counts of possession of meth, Level 6 felony possession of a syringe and Level 6 felony maintaining common nuisance.

The state moved to transfer the money seized from Eminger’s home to the U.S. Department of Justice but did not notify Eminger of the motion. The Noble Superior Court granted the state’s motion.

In 2018, Eminger pleaded guilty to Level 6 felony possession of meth, and in exchange the state dismissed the other charges.

Less than a year later, he filed a motion for relief from the court’s transfer order, alleging the order violated Indiana Code Chapter 34-24-1. In response, the state moved to dismiss Eminger’s Trial Rule 60(B) motion because the state no longer had jurisdiction over the currency, and also on the theory that Eminger was not entitled to a notice.

The trial court granted Eminger’s motion because he had not been served proper notice and because procedural requirements of Indiana Code Chapter 34-24-1 had not been followed.

The state later filed a motion for relief from the judgment under Indiana Trial Rule 60(B)(8), which the trial court granted, vacating its prior order.

On appeal, Eminger brought one issue to the COA: whether the trial court abused its discretion when it granted the state’s motion, which was filed after the court had granted Eminger’s Rule 60(B) motion.

Reversing the trial court, the Court of Appeals held, “Eminger was entitled to challenge the State’s motion to transfer, but the State failed to serve that motion on Eminger, and the trial court erroneously granted the State’s transfer motion without permitting Eminger to challenge it.

“We conclude that the proper remedy on Eminger’s motion for relief from that judgment is to afford Eminger a hearing at which he may challenge the lawfulness of the State’s seizure of the currency,” Judge Paul Mathias wrote.

The case now goes back to the trial court on remand. If the court determines the state’s seizure of the currency was unlawful, the state must reimburse Eminger and can try to recoup the money from the federal government.

The case is Tyson Eminger v. State of Indiana, 22A-CR-1077.

__________

Feb. 13

Penny Chappey and Gregory Chappey v. Joseph Paul Storey and Complete Auto & Tire, LLC

22A-CT-979

COA finds judicial bias, reverses summary judgment after judge declares civil
litigation in Indiana is ‘broken’

After the trial court judge issued — then subsequently withdrew — a scathing opinion declaring Indiana’s civil litigation system was “broken,” the Court of Appeals of Indiana has reversed summary judgment in the underlying negligence case, finding the judge was biased.

The reversal was handed down in Penny Chappey and Gregory Chappey v. Joseph Paul Storey and Complete Auto & Tire, LLC, 22A-CT-979.

In 2018, Penny Chappey called Complete Auto & Tire when her SUV became stuck in a retail parking lot in Delphi. Joseph Paul Storey, of Complete Auto & Tire LLC, arrived with a flatbed tow truck.

Chappey asked if she could leave her bulldog puppy in the car while it was towed and Storey said yes. After the SUV was loaded onto the flatbed, Chappey got on the flatbed to restrain her dog at Storey’s request. Storey, however, said he did not ask Chappey to get on the flatbed and did not know she was there.

Regardless, when Chappey turned to get off the flatbed, she fell several feet and sustained injuries.

Almost a year later, Chappey and her husband, Gregory, filed a complaint against the towing company and Storey for negligence. The case eventually went to a summary judgment hearing before Judge Benjamin Diener, who was openly skeptical of the Chappeys’ case.

Specifically, Diener said he “wouldn’t be suing in this situation” and opined that the case wasn’t a “valuable use of limited judicial resources” given that Penny was not able to explain why she fell off the flatbed.

Diener ultimately entered summary judgment for the defendants, calling the case frivolous and declaring that insurance companies “use the Courts as a potential revenue stream to extract funds from
each other … .”

Diener subsequently scrubbed those comments from the order.

On appeal, the Chappeys raised two issues. First, they argued there were genuine issues of material fact that precluded the entry of summary judgment.

The Court of Appeals agreed.

“While one reasonable inference is that Penny fell because she wasn’t careful, another reasonable inference is that navigating a tight space elevated several feet from the ground at the request of the tow-truck operator placed her in an unreasonable position of peril resulting in her fall,” Judge Nancy Vaidik wrote. “Because the facts don’t lead to a single inference, proximate cause is a question of fact to be determined by a jury. Summary judgment for the defendants was therefore improper.”

Second, the Chappeys argued the judge was biased and they were denied due process.

Again, the COA agreed.

“The record shows that the judge’s actions and demeanor crossed the barrier of impartiality and torpedoed the Chappeys’ case,” Vaidik wrote. “We therefore conclude that the judge failed to preside over the case as a neutral, impartial decision maker in violation of the Chappeys’ due-process rights.”

The case was remanded with the provision that the Chappeys are entitled to a new judge.

Leon David Lehman v. State of Indiana

22A-CR-1449

Appellate court splits in affirming OWI conviction

An Adams County sheriff’s deputy did not violate a motorcyclist’s rights when the deputy charged him with operating a vehicle while intoxicated after stopping him for a different violation, the Court of Appeals of Indiana has ruled.

The case traces back to a traffic stop in the city of Berne on Dec. 11, 2020. Adams County Deputy Peter Amstutz pulled over appellant-defendant Leon Lehman, who was driving a motorcycle with a purple light visible from the vehicle’s front — a violation of Indiana traffic code, which prohibits the display of non-white or non-amber lights on a vehicle.

After exiting his cruiser to talk with him, Amstutz noticed that Lehman smelled of alcohol and had bloodshot, watery eyes. Lehman admitted he had been drinking but denied using illegal drugs.

Lehman twice failed the horizontal gaze nystagmus test, in which an officer observes a person’s eye movements for signs of intoxication. Lehman consented to a blood test, which later revealed that his blood alcohol level was below the legal limit, though his blood did test positive for methamphetamine and amphetamine.

On Dec. 15, 2020, Lehman was charged with two counts of Level 6 felony operating a vehicle while intoxicated and with a Class C light restriction infraction. In March 2022, the state amended those charges to Class A misdemeanor operating a vehicle while intoxicated endangering a person; Class C misdemeanor operating a vehicle with a Schedule I or II controlled substance or its metabolite in the blood; and the Class C light restriction infraction.

Lehman was found guilty on all three charges in a bench trial. On May 24, 2022, he was sentenced to 365 days’ incarceration, with 270 days executed and the remainder suspended to probation, on the charge of operating a vehicle while intoxicated endangering a person.

In his appeal, Lehman argued that the Adams Superior Court had erred in admitting evidence from the traffic stop, which Lehman contended violated his state and federal constitutional protections against unreasonable search and seizure.

Lehman’s appeal also asserted that there was insufficient evidence that he was intoxicated and that he committed a light restriction infraction.

The Court of Appeals rejected Lehman’s argument, noting that Lehman had admitted to the deputy that he had consumed alcohol and that Lehman’s blood revealed the presence of alcohol, amphetamine and methamphetamine.

“This was sufficient evidence that he was intoxicated within the meaning of the statute,” Judge Patricia Riley wrote.

Lehman had also argued that the state failed to provide sufficient evidence of endangerment, but the Court of Appeals disagreed with that assertion.

Lehman had admitted that he was driving 35 mph in a 30 mph zone, Riley wrote, and Amstutz had testified that Lehman was driving “slightly higher” than 35mph.

“While we agree with Lehman that there is no bright-line rule concerning the precise extent of speeding that constitutes endangerment, we have no trouble finding sufficient evidence of endangerment here, where Lehman drove a motorcycle above the posted speed limit at night down an unlit side street in a residential area,” she said.

Judge L. Mark Bailey concurred with Riley in Leon D. Lehman v. State of Indiana, 22A-CR-1449. Judge Nancy Vaidik concurred in part and dissented in part.

In a separate opinion, Vaidik said she did not think the state had proven that Lehman’s intoxicated driving merited a Class A misdemeanor charge.

“I cannot say that traveling six or seven miles per hour over the speed limit, without swerving or other unsafe operation, increases the danger of intoxicated driving to such an extent that it justifies the jump from a Class C misdemeanor to a Class A misdemeanor,” Vaidik wrote.

Vaidik said she would reverse Lehman’s Class A misdemeanor conviction and remand the matter to the trial court with instructions to enter a Class C misdemeanor conviction and to resentence Lehman accordingly. She otherwise concurred.

__________

Feb. 14

Darleana Johnson v. Housing Authority of South Bend

22A-EV-1751

Evicted tenant wins reversal for due process violation

A Housing Authority of South Bend tenant was deprived of her right to due process when she was not allowed to present her pro se defense during her eviction hearing, the Court of Appeals of Indiana has ruled.

The court reversed the St. Joseph Small Claims Court’s order on final possession of the property and remanded the case for further proceedings.

The dispute underlying the case involves a Housing Authority of South Bend rental home that Darleana Johnson lived in with her four children.

Johnson had reported to a property manager that the rental home was not habitable because of mold, a burnt and sparking electrical outlet, water damage due to leaky sinks and pipes, and sewage that had backed up into the home.

The Housing Authority said its inspection of the home revealed no issues other than one with the home’s heating and cooling system.

The Housing Authority offered alternative housing, which Johnson declined because she said the two alternatives were just as inhabitable as her current home. The Housing Authority then evicted Johnson and ordered her to pay owed rent.

The Housing Authority’s position was that it could not permit a tenant to live in housing that was alleged to be uninhabitable — and because Johnson had refused to vacate, the Housing Authority had no other choice but to terminate her lease.

During an evidentiary hearing for Johnson’s eviction proceedings in June 2022, Johnson represented herself.

Johnson attempted to assert a defense based on the Housing Authority’s failure to provide a habitable residence. But the small claims court denied her requests to call a witness and to introduce evidence to support her case, saying the defenses had to be raised in a federal court.

The Court of Appeals disagreed with the small claims court’s position, finding Johnson was entitled to raise both her federal law defense and her contracts defense in a state court.

“We are not insensitive to the realities of small claims courtroom adjudications,” the Court of Appeals wrote in its opinion. “Dockets are crowded and litigants are frequently unrepresented by counsel. Nonetheless, we find that the small claims court did not provide Johnson with sufficient due process when it refused to hear her defense(s). If proven, her defense(s) may establish that she was not in breach of the lease, that HASB was in breach of the lease, and Johnson did not unlawfully retain possession of the property.”

The opinion in the Court of Appeals case, Darleana Johnson v. Housing Authority of South Bend, 22A-EV-1751, was written by Judge Peter R. Foley, with Judges Margret G. Robb and Paul D. Mathias concurring.

In a separate memorandum decision in case 22A-EV-2459, the same panel dismissed Johnson’s appeal of a damages award entered against her as part of the order on final possession, finding it “cannot meaningfully review a damages award predicated on a liability that no longer stands.”

__________

Feb. 15

R.M. v. Indiana Department of Child Services

22A-XP-1661

Mom loses bid to expunge DCS records about ‘deplorable’ conditions that led to kids’ removal

A mother whose children were removed and eventually adopted after living in “deplorable” conditions under her care has failed to convince the Court of Appeals of Indiana that the underlying child welfare reports about her should be expunged.

The case of R.M. v. Indiana Department of Child Services, 22A-XP-1661, dates back nearly a decade to June 2013, when the Indiana Department of Child Services received a report that mother R.M.’s children were being exposed to domestic violence and were living without basic needs. A DCS investigation revealed “deplorable” conditions at the family home, which had been condemned.

The children were subsequently placed with their grandmother and were adjudicated as children in need of services. R.M. later voluntarily relinquished her parental rights, and the grandmother adopted the children in May 2016.

More than five years later in December 2021, R.M. filed a petition under Indiana Code § 31-33-27-5 to expunge DCS’ substantiated reports about her. The Sullivan Circuit Court denied that petition without a hearing.

R.M. then filed a motion to correct error, arguing that DCS’ response to her petition had not been timely filed and that the trial court was required to hold a hearing. The court did hold a hearing in June 2022, but denied the motion to correct error.

The Court of Appeals affirmed, agreeing with the trial court that “DCS’s substantiated reports about (R.W.) do have sufficient current probative value to warrant retention for future reference.”

“… (T)he trial court found, and R.M. does not challenge, that she lives with a child,” Judge Melissa May wrote. “Because R.M. lives with a child, the trial court noted the retention of her DCS substantiated reports would be of probative value in the event DCS received a report that R.M. was engaging in behavior that would be neglect or abuse of a child.

“Further, the licensing requirements for R.M.’s current or any future course of study are unknown and, as the trial court found, DCS’s substantiated report about R.M. could be relevant to those decisions,” May continued, referencing R.M.’s full-time schooling. “Therefore, the trial court did not abuse its discretion when it denied R.M.’s petition to expunge DCS’s substantiated reports about her.”

In a footnote, the COA addressed the trial court’s ruling that it would not expunge records related to the 2013 CHINS case pursuant to I.C. 31-39-8-4(a). The appellate court noted R.M. failed to correctly cite that statute and did not make any argument under it, thus waiving that argument on appeal.

Waiver notwithstanding, “Proving the falsity of a CHINS finding, as required by Indiana Code section 31-39-8-4, would be a much harder standard to meet than proving a substantiated report has insufficient current probative value to justify retention … ,” the footnote added. “Thus, even had R.M. escaped waiver, her failure to prove the elements of Indiana Code section 31-33-27-5(f) indicates relief under Indiana Code section 31-39-8-4 also would not be available for R.M.”

__________

Feb. 20

Jennifer L. Tutt v. Evansville Police Department

22A-MI-1723

Reversal: Police can’t charge to ‘inspect’ accident reports

Police departments cannot charge citizens a fee to “inspect,” rather than “obtain,” accident reports, the Court of Appeals of Indiana has ruled, ordering the Evansville police to allow a woman to inspect such a report at no charge.

The case of Jennifer L. Tutt v. Evansville Police Department, 22A-MI-1723, began in February 2021, when Jennifer Tutt asked to inspect an accident report at the Evansville Police Department. An employee told Tutt she would have to pay $12 online, even though she didn’t want an actual copy of the report for herself.

Still, the department denied Tutt’s request to inspect the report unless she paid, so she sued under the Indiana Access to Public Records Act.

Both parties moved for summary judgment, which was entered in favor of EPD.

The Court of Appeals, however, reversed, determining the APRA does not allow for the collection of fees to merely inspect a report.

The parties agreed that the APRA does not provide for the collection of a fee to “inspect” a record, but the police department argued it was entitled to collect such a fee under Title 9 of the Indiana Code. Specifically, resolution of the case turned on the interpretation of Indiana Code § 9-26-9-3.

“Tutt asserts that subsections (a) and (c)(1) authorize a fee for obtaining an accident report but not for inspecting the report. The language of the statute supports this reading,” Judge Nancy Vaidik wrote.

“As highlighted above, sections (a) and (c)(1) provide that a fee can be charged for ‘each report’; the subsections do not provide that a fee can be charged for ‘inspecting and copying each report,’” Vaidik wrote. “Notably, subsection (c)(2) says just that; it provides that a fee can be charged for ‘the inspection and copying of other report related data maintained by the department.’

“If the legislature wanted to include a fee for the ‘inspection’ of an accident report (as opposed to ‘other report related data’), it could have used the same language in (c)(1) that it used in (c)(2),” the judge continued. “It did not.

“… We recognize that the Indiana State Police has entered into an agreement with LN Coplogic to operate the ARIES system (a repository for crash reports) and that citizens can conveniently purchase accident reports for $12 from buycrash.com. We also recognize that a portion of these fees are returned to the law-enforcement agencies that investigated the accidents and that such fees provide important funding to the agencies,” Vaidik concluded. “But this arrangement and system do not change the fact that neither the APRA nor Title 9 authorizes a fee to inspect an accident report. Accordingly, Tutt can go to the Department to view the accident report for no fee.”

The case was remanded for the entry of summary judgment for Tutt.

Jaspreet Singh v. State of Indiana

22A-CR-1316

COA reverses reckless homicide conviction after distracted driving evidence wrongly excluded

The Court of Appeals of Indiana has overturned a man’s felony reckless homicide conviction, finding the trial court erred in excluding evidence that the victim was using her phone at the time of the fatal vehicle crash.

Jaspreet Singh was driving on U.S. Highway 35 South in a semitractor-trailer when he attempted to turn left on the Anoka Exchange. Singh overshot the intersection, turned on his hazard lights and began to reverse.

Moments later, an SUV slammed into the back of the corner of Singh’s truck, spun around and then stopped. The only occupant of the SUV, Jamie Pay, died upon impact.

Pay had been driving “approximately 73 to 75 miles an hour” and made no hard movement away from the truck before the crash. The SUV’s black box revealed Pay never tried to brake, and her seatbelt wasn’t latched.

Singh called 911 while another driver got out of his vehicle and looked for any bodies that could have been thrown from the SUV, eventually discovering Pay. The driver then approached Singh, who handed off the phone because he spoke limited English.

Cass County law enforcement interviewed Singh and took him to and from the hospital for chemical testing. The results showed both he and Pay were negative for intoxicants.

Further investigation by the Indiana State Police digital forensic examiner showed Pay was using Snapchat during the time of the crash.

A little over two weeks after the crash, the state charged Singh with Level 5 felony reckless homicide.

A two-day jury trial was held, with Punjabi interpreters appointed for Singh.

The state and Singh’s counsel debated whether the defense should introduce the evidence that Pay was reading and composing messages on Snapchat to a friend prior to the crash. The court excluded both the proposed evidence as well as a distracted driving line of questioning.

The jury found Singh guilty as charged.

At the sentencing hearing, while the trial judge acknowledged Singh’s law-abiding life and lack of criminal history, she also noted his lack of expression of remorse. Thus, the trial court sentenced Singh to six years in the Department of Correction, 365 days of which could be served on community corrections if he became eligible, and suspended his driver’s license for five years.

In Jaspreet Singh v. State of Indiana, 22A-CR-1316, Singh appealed his conviction and sentence, raising evidentiary, instructional and sufficiency issues.

Reversing in Singh’s favor, the COA disagreed with the state’s argument in favor of excluding the Snapchat evidence. The state had argued the evidence would be confusing for the jury and would be highly prejudicial negative character evidence.

“Regardless of the exact content or subject matter of the Snapchat message, a reasonable jury could infer that sending a photo or video via Snapchat might consume more attention than a standard text that might feasibly be done hands-free,” Judge Terry Crone wrote.

“… Reckless-homicide-via-vehicle cases are incredibly fact-sensitive,” Crone wrote. “Here, without the introduction of the Snapchat evidence or the evidence about distracted driving, the jury did not have the full picture of this tragic situation.

“… Finding that the excluded evidence was indeed relevant, we turn to the Evidence Rule 403 balancing test,” the judge continued. “We do not agree with the State’s contention that the Snapchat evidence constitutes the type of prior, uncharged bad acts that the rule is designed to guard against.”

The appellate court thus reversed both Singh’s conviction and sentence, remanding the case on the evidentiary issues.

“On remand, we encourage the careful drafting of instructions to alleviate any potential for prejudice or confusion that might arise depending upon what evidence the State and the defense present,” Crone wrote. “Relatedly, we are not rendering an opinion regarding Singh’s proposed intervening cause instruction because the propriety of such an instruction will likewise depend upon what specific evidence is put forth on remand. Our decision obviates the need for us to address either the sufficiency or the sentencing challenges.”

__________

Feb. 21

Indiana Office of Utility Consumer Counselor, et al. v. Duke Energy Indiana, LLC, and Indiana Utility Regulatory Commission

21A-EX-2702

COA reverses IURC’s approval of certain Duke Energy coal-ash cleanup costs

The Indiana Utility Regulatory Commission shouldn’t have approved Duke Energy’s request to recover costs related to a federal environmental mandate for coal-ash cleanup that were incurred before the energy company received approval, the Court of Appeals of Indiana has ruled.

Duke filed its petition with the IURC in 2019 requesting a rate increase to recover $212 million for coal-ash site closures, remediation and financing costs as part of its compliance with Environmental Protection Agency rules issued four years earlier. The money accounted for costs incurred from 2010-2018 and costs it expected to incur from 2019 forward.

Duke, which has about 840,000 customers in Indiana, proposed spreading the recovery over an 18-year period.

The Indiana Office of Utility Consumer Counselor intervened in the IURC proceeding on behalf of ratepayers.

The issue is split into two categories: Duke’s traditional base rate case that included costs incurred through 2018, and its requested relief based on the Federal Mandate Statute for costs incurred from 2019-2028.

The Federal Mandate Statute is a tracker authorized by the General Assembly to allow for the recovery of certain approved categories of costs without the need for a general rate case proceeding.

The IURC found in 2021 that Duke’s proposed coal-ash costs were appropriate to recover through the statute, granting the energy company a certificate of public convenience and necessity.

The IOUCC appealed, but the appeal was held in abeyance pending the Indiana Supreme Court’s decision in the separate traditional rate case. In March 2022, the Supreme Court concluded the regulatory commission violated a ban against retroactive ratemaking by allowing rate recovery for costs incurred in the past.

Back in the Court of Appeals case, related to costs incurred from 2019-2028, the IOUCC argued the commission’s decision to allow Duke to recover some costs related to federal mandates — specifically those in 2019 through the commission’s approval in November 2021 — violated the Federal Mandate Statute. The IOUCC argued the statute is prospective, meaning it anticipates approval of a project before the utility company can recover costs.

The Court of Appeals agreed, reversing the IURC’s order that allowed Duke to recover costs incurred before the commission’s approval.

“The logical and plain reading of the Federal Mandate Statute results in a prospective nature of cost recovery,” Judge Patricia Riley wrote in the opinion.

The Court of Appeals cited the Supreme Court’s 2022 decision, which Riley wrote was “grounded in the principle that ratemaking is prospective in nature, not retroactive.”

Duke argued the Supreme Court’s decision was neither binding nor dispositive. While the Court of Appeals agreed that it must consider the question presented, it also viewed dicta from the March 2022 decision as an indication that the high court believes a utility can’t recoup certain expenses under the statute until getting authorization from the commission.

“Absent preapproval, the risk of loss remains on the utility during the period between rate orders,” Riley wrote.

Duke also argued a utility is entitled to recover not only costs incurred while the certificate of public convenience and necessity is pending, but also pre-petition costs associated with preparing the application. The Court of Appeals disagreed. Though some federal mandates found in the statute include those applicable to utility companies, Riley wrote litigation expenses and pre-petition costs aren’t federally mandated costs under the statute.

“Nothing in the statute indicates that all costs must be recoverable; to the contrary, only the ‘projected’ costs of a ‘proposed compliance’ project are subject to the Commission’s approval and are recoverable,” she wrote.

Chief Judge Robert Altice and Judge Rudolph Pyle concurred.

The case is Indiana Office of Utility Consumer Counselor, et al. v. Duke Energy Indiana, LLC, and Indiana Utility Regulatory Commission, 21A-EX-2702.•