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The Indiana Supreme Court has affirmed Clark Circuit Court’s $30,000 sanction and discovery order against an adult entertainment venue.
Theatre X was operated by Midwest Entertainment Ventures on property owned by AMW Investments. The companies were penalized for violating court-imposed discovery rules during litigation with the town.
The violations occurred as part of broader legal disputes concerning property use and regulatory compliance. Ultimately, Clarksville revoked Theatre X’s adult business license in 2019 due to zoning ordinance violations. The owners appealed that decision in Clark Circuit Court.
During discovery for that case, the Clark Circuit Court found that AMW Investments’ first supplemental responses, tendered in June 2021, were late. It also found that AMW continued to object and withhold documents based on relevance and privilege objections that had been waived.
The trial court imposed a $30,000 civil sanction, but noted the fine could be avoided by complying with the discovery order.
In January, the Indiana Court of Appeals ruled that Special Judge Marsha Owens abused her discretion by refusing to consider AMW Investments supplemental discovery responses.
However, the high court ruled differently last week. The justices unanimously ruled that AMW did waive the objections because they submitted them after the response deadlines imposed by the trial rules.
“Busy trial judges need not tolerate ploys for avoiding discovery. The burdens of good-faith discovery disputes weigh heavily enough on parties and courts,” Justice Geoffrey Slaughter wrote.
Scott Bergthold, Clarksville’s town attorney, expressed gratitude for the ruling.
“The Town of Clarksville is thankful for the Indiana Supreme Court’s unanimous decision upholding the contempt order against Theater X and finding that Theater X’s conduct in the case it brought against the Town has been ‘indefensible’ and ‘inexcusable,’ ” he said. “In the wake of the Supreme Court’s ruling, the town intends to proceed with seeking a successful resolution of the case.”
Attorneys for AMW did not immediately respond to requests for comment.
The case has been sent back to the local court for proceedings on the larger legal issues dealing with zoning violations and AMW’s challenge to the city’s revocation of its adult entertainment license.
The case is AMW Investments Inc., etc. v. The Town of Clarksville, etc., 24S-PL-183. Appellants’ attorneys: Kenneth Pierce with Blanton & Pierce LLC and Matthew Hoffer with Shafer & Associates P.C. Appellees’ attorneys: C. Gregory Fifer and Scott Bergthold.
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