INDIANAPOLIS (WISH) — Lawyers for Indiana’s Bureau of Motor Vehicles appeared before a judge Wednesday to defend the agency against allegations that it violated court orders to produce key documents in a lawsuit alleging it overcharged millions of drivers on a wide variety of fees.
Marion County Judge John Hanley issued the order earlier this month, directing the BMV and its Commissioner Don Snemis to appear in court to show why they should not be found in contempt of court.
Snemis, however, was a no-show Wednesday — a point quickly brought to the judge’s attention by plaintiff’s attorney Irwin Levin of Indianapolis based Cohen & Malad LLP.
“The court order is very clear,” Levin told the judge. “He was ordered to appear and did not appear.”
“The order to show cause did not direct anyone to appear in person,” argued BMV attorney Carl Hayes, of Bingham Greenebaum Doll LLP. “We’ve always appeared by counsel.”
Snemis’ absence did not stop the two sides from arguing for more than two hours over the handling of thousands of records involved in the case.
Levin told the judge that his original request for documents and emails related to the BMV’s fee matrix, internal audits and its own overcharging investigations had been made nearly one year ago.
“This is what they’ve produced in that year,” he said, holding up a small folder. “Why are we here so often [in court]? This is why we’re here so often. Because of efforts to delay and fraudulent concealment.”
At a hearing on July 30, Judge Hanley agreed to give the BMV 60 days to produce the requested documents. That response wasn’t fulfilled until Tuesday night, more than two weeks after the deadline had passed, Levin told the judge.
“They could have complied within 60 days,” Levin said in court. “They chose not to.”
Hayes and fellow BMV attorney Wayne Turner told the judge that isn’t true, arguing that the volume of documents requested was simply too overwhelming for the given time frame.
“I personally supervised more than 560 hours expended by nine attorneys, one paralegal and one law clerk,” Hayes told the judge. “We found more than 42,000 responsive documents containing 267,616 pages. There was no intent here to disobey the court’s order, and there was no willful disregard of the court’s order, as we filed for a motion of extension.”
That extension request, Hayes said, was filed on Sept. 29, the day of the judge’s imposed deadline. Both Hayes and Turner declined to comment on the hearing as court adjourned.
“It was filed after the close of business,” Levin countered in court. “It was late and presumed to be granted, when in fact, it was not.”
Levin asked the judge to impose sanctions on the BMV, Snemis and the agency’s attorneys, including a ruling that any defense based around Indiana’s statute of limitations be prohibited if the case goes to trial.
“The state is taking the position that there is this statute of limitations that says — if we were able to hide it long enough, we don’t have to pay you back. We have argued that they fraudulently concealed the fact that they were overcharging and the statute of limitations should not apply,” Levin said following the hearing.
The two sides also argued at length over a request from the BMV that Judge Hanley prohibit the public release of video depositions taken in the case.
The request follows reports from I-Team 8 and other media outlets on the videotaped deposition of former BMV Deputy Director Matthew Foley, who testified in May that the BMV was aware as early as 2010 that some of its fees exceeded the amounts allowed under state law, but that it continued overcharging Hoosier drivers for at least two years in order to avoid budget troubles.
“This is not a request for a gag order,” Turner told the judge. “This is a matter of protecting the interest of public servants. The public isn’t getting the right evidence in the case because they’re not getting the whole story.”
Clips of the deposition used by I-Team 8 and other outlets have been “taken out of context,” Turner argued. Subjects of the depositions have also been made to feel uncomfortable due to their public release, he said.
“The BMV is a public agency” Levin countered in court. “It should have more oversight, not less. [Turner] has presented no evidence that anyone is annoyed, afraid or in fear of testifying. In fact, just the opposite. Mr. Foley testified in his deposition that he has nothing to hide, and had no problem if the video were to be made public.”
Turner’s motion, however, does not seek to restrict the release of written transcripts of the depositions, prompting Judge Hanley to scratch his head, and ask why.
“Written transcripts are much more likely to be posted for viewing in full,” Turner responded.
“The BMV doesn’t have the right to determine how the press covers this story,” Levin said after court adjourned. “That’s the First Amendment in this country — that the press can present the story in the way it believes is the most effective.”
TOSSING THE CASE?
The BMV’s attorneys also argued to the judge that the lead plaintiff in the case never paid “at least 28 of the 29 fees” questioned in the lawsuit. The agency filed a motion earlier this year asking for the judge to throw out the case based on those grounds.
A hearing on that request is set for December.
It’s the second such claim in response to a lawsuit from Levin claiming Hoosier drivers are entitled to refunds from the BMV.
In August 2013, millions of Hoosier drivers were issued small refunds as part of a $30 million settlement where the BMV admitted it had overcharged drivers under the age of 75 who obtained or renewed a driver’s license between 2007 and 2013. The overcharges averaged around $3.50, according to court documents.
The following month, the BMV announced that a commissioned review by an outside law firm had also identified other fees being charged at rates higher than allowed by state law. The second lawsuit alleges the additional fees include everything from vehicle registrations to motorcycle endorsements, personalized license plate fees and chauffeurs licenses.
Last month, the BMV also admitted it had overcharged excise taxes by more than $29 million since 2004. Approximately 180,000 drivers affected by the mistake should receive a claim form in the mail within the next three weeks.
Judge Hanley agreed to take all arguments made Wednesday under advisement, and could issue rulings on them at any time. Clues to his line of thinking, however, were made clearer as the two-hour hearing came to a close.
“It shouldn’t be necessary to remind you that courts are not eager to inject themselves into discovery disputes,” he told the two sides. “Trial rules are very clear about cooperation. If that’s not a possibility here, and requires constant oversight by the court, then the court will perform that function. I hope I’ve made myself clear.”