KS & E Sports v. Runnels

• Decision Date: 17 March 2016
• Docket Number: No. 49A02–1501–CT–42.,49A02–1501–CT–42.
• Citation: 66 N.E.3d 940
• Parties: KS & E SPORTS and Edward J. Ellis, Appellants–Defendants, v. Dwayne H. RUNNELS, Appellee–Plaintiff.
• Court: Indiana Appellate Court

66 N.E.3d 940

KS & E SPORTS and Edward J. Ellis, Appellants–Defendants,

v.Dwayne H. RUNNELS, Appellee–Plaintiff.

No. 49A02–1501–CT–42.

Court of Appeals of Indiana.

March 17, 2016.

Vincent P. Antaki, Reminger Co., LPA, Indianapolis, IN, Christopher Renzulli, Renzulli Law Firm, LLP, White Plains, NY, Attorneys for Appellants.

Roger L. Pardieck, Karen M. Davis, The Pardieck Law Firm, Seymour, IN, Jonathan E. Lowy, Robert B. Wilcox, Jr., Brady Center to Prevent Gun Violence, Legal Action Project, Aarash Haghighat, Arnold & Porter, LLP, Washington, DC, Michael D. Schissel, Arnold & Porter, LLP New York, NY, Attorneys for Appellee.

Indiana Trial Lawyers Association, Nicholas F. Baker, The Hastings Law Firm, Indianapolis, IN, Law Enforcement and Municipal Organizations, Shana D. Levinson, Levinson & Levinson, Merrillville, IN, Scott M. Abeles, Stephen R. Chuk, Proskauer Rose, LLP, Washington, DC, Amici Curiae.

RILEY, Judge.

STATEMENT OF THE CASE

[1] Appellants–Defendants, KS & E Sports and Edward J. Ellis (Ellis)¹ (collectively, KS & E) appeal the trial court's denial of their motion for judgment on the pleadings against Appellee–Plaintiff, Dwayne H. Runnels (Runnels), in which KS & E Sports asserted immunity from suit pursuant to Indiana Code section 34–12–3–3(2), arguing that Runnels' damages resulted from the criminal misuse of a firearm by a third party.

[2] We affirm.²

ISSUE

[3] KS & E Sports raised one issue on interlocutory appeal, which we restate as: Whether Runnels' Complaint stated a claim on which relief can be granted.

FACTS AND PROCEDURAL HISTORY

[4] On December 12, 2011, Runnels, a patrol officer for the Indianapolis Metropolitan Police Department, initiated a traffic stop of a vehicle allegedly involved in a recent armed robbery and shooting. As Runnels approached the vehicle, Demetrious Martin (Martin) exited the driver side of the vehicle with a handgun and fired two shots. One bullet missed Runnels but struck his patrol car. The second bullet pierced Runnels' hip and lodged in his upper pelvis. Runnels returned fire, killing Martin.

[5] An ATF trace on the Smith & Wesson handgun used by Martin revealed that it was purchased at the KS & E Sports retail store in Indianapolis on October 10, 2011, two months prior to the shooting. It is alleged that Martin, a convicted felon who could not legally purchase a gun, obtained the handgun through an unlawful straw sale. Martin and Tarus E. Blackburn (Blackburn) entered the KS & E Sports store together and Martin selected the handgun in the presence of Blackburn and a KS & E Sports' employee. Martin and Blackburn then left the store only to return later that afternoon. Upon their return, only Blackburn entered KS & E Sports and completed the firearms purchase paperwork of the handgun previously selected by Martin. Blackburn paid the purchase price of $325 in cash. Once outside the store, Blackburn transferred the handgun to Martin for $375.³

[6] On December 10, 2013, Runnels filed his Complaint against KS & E Sports, Ellis, and Blackburn for "damages resulting from KS & E's negligent, reckless, and unlawful sale of a Smith & Wesson .40 caliber handgun to ‘straw buyer’ Blackburn and the negligent entrustment of that firearm to Blackburn and [Martin], who used the Smith & Wesson Handgun to shoot and harm [Runnels]." (Appellant's App. p. 10). Runnels asserted claims of negligence, negligent entrustment, negligence per se, negligent hiring/training/supervision, conspiracy, public nuisance, and piercing the corporate veil.

[7] On June 4, 2014, after answering the Complaint, KS & E filed its motion for judgment on the pleadings pursuant to Indiana Trial Rule 12(C)"on the grounds that [Ind.Code] § 34–12–3–3(2) requires immediate dismissal of this case." (Appellant's App. p. 36). Following a hearing, the trial court summarily denied KS & E's motion on October 21, 2014. The trial court subsequently granted KS & E's motion to certify its ruling for interlocutory appeal. This court accepted jurisdiction on February 20, 2015.

[8] Additional facts will be provided as necessary.

DISCUSSION AND DECISION

[9] KS & E contends that the trial court erred when it denied its motion for judgment on the pleadings pursuant to Ind. Trial Rule 12(C). A motion for judgment on the pleadings pursuant to T.R. 12(C) attacks the legal sufficiency of the pleadings. Davis ex rel. Davis v. Ford Motor Co., 747 N.E.2d 1146, 1149 (Ind.Ct.App.2001), trans. denied. In reviewing a trial court's decision on a motion for judgment on the pleadings, this court conducts a de novo review. Id. The test to be applied when ruling on a T.R. 12(C) motion that raises the defense of failure to state a claim upon which relief can be granted is whether, in the light most favorable to the non-moving party and with every intendment regarded in his favor, the complaint is sufficient to constitute any valid claim. Id. In applying this test, the court may look only at the pleadings, with all well-pleaded material facts alleged in the complaint taken as admitted, supplemented by any facts of which the court will take judicial notice. Id. at 1149. "The ‘pleadings' consist of a complaint and an answer, a reply to a counterclaim, an answer to a cross-claim, a third-party complaint, and an answer to a third-party complaint." Consol. Ins. Co. v. Nat'l Water Servs., LLC, 994 N.E.2d 1192, 1196 (Ind.Ct.App.2013) (quoting Waldrip v. Waldrip, 976 N.E.2d 102, 110 (Ind.Ct.App.2012) ). "Pleadings also consist of any written instruments attached to a pleading." SeeT.R. 10(C) ("A copy of any written instrument which is an exhibit to a pleading is a part thereof for all purposes."). As such, a motion for judgment on the pleadings theoretically is directed towards a determination of the substantive merits of the controversy. Davis, 747 N.E.2d at 1150. We will affirm the trial court's grant of a T.R. 12(C) motion for judgment on the pleadings when it is clear from the face of the pleadings that one of the parties cannot in any way succeed under the operative facts and allegations made therein. Id. at 1149.

[10] In our de novo review of the trial court's denial of a motion for judgment on the pleadings, then, we must consider whether Runnels' Complaint is legally sufficient to support relief under any circumstances. In his Complaint, Runnels advances several claims, sounding in negligence and nuisance, and focuses on the harm that KS & E proximately caused through their alleged wrongful and unlawful conduct by entrusting a handgun to a straw purchaser.

[11] In total, Runnels' Complaint presents KS & E with seven claims for relief. Specifically, Runnels asserts that KS & E breached its "duty to exercise reasonable care on selling firearms and to refrain from engaging in any activity that would create reasonably foreseeable risks of injury to others." (Appellant's App. p. 21). As such, KS & E knew or reasonably should have known that Blackburn was not the intended purchaser of the handgun. In a similar light, Runnels brings a claim of negligent entrustment, contending that "KS & E and its employee(s) wantonly permitted Blackburn to acquire possession of the Smith & Wesson handgun under circumstances in which it knew or should have known that Blackburn would use the handgun in a manner that would create a substantial and unacceptable risk of physical injury to others." (Appellant's App. p. 15). As a third Count, Runnels asserts that based on the illegal straw sale, KS & E committed negligence per se, followed by a claim of negligent hiring, training and supervision because "KS & E placed its employee(s) in a position to cause foreseeable harm to the public by wantonly failing to implement adequate protocols for training and supervising its employee(s) to prevent unlawful straw sales to individuals such as Blackburn[.]" (Appellant's App. p. 28). Runnels also claims to have incurred damages resulting from a conspiracy "to unlawfully and unreasonably sell firearms without exercising ordinary care in order to make a profit." (Appellant's App. p. 29). Besides claims based on negligence, Runnels presents a public nuisance assertion because "[b]y negligently, recklessly, and/or intentionally selling vast quantities of firearms in a manner that ensures a steady flow of firearms in large quantities to illegal traffickers, the illegal secondary market, criminals, juveniles, and others prohibited by law from having firearms and/or persons with criminal purposes, KS & E has negligently and/or knowingly participated in creating and maintaining an unreasonable interference with the rights held in common by the general public, constituting a public nuisance under Indiana law[.]" (Appellant's App. p. 21). Finally, Runnels attempts to pierce the corporate veil because the company was used by its owner to promote illegal activities in violation of state and federal law.

I. Negligence Claims

[12] The elements of a negligence action which have long been recited by courts in Indiana and elsewhere are duty, breach, causation, and harm. Estate of Heck v. Stoffer, 786 N.E.2d 265, 268 (Ind.2003). Following Webb v. Jarvis, 575 N.E.2d 992 (Ind.1991), the duty issue became viewed in terms of the balance of foreseeability, public policy, and the relationship between the parties. Where a duty is already recognized, it is to be followed and we need not turn to a balancing test of factors to determine whether a duty exists. N. Ind. Pub. Serv. v. Sharp, 790 N.E.2d 462, 465 (Ind.2003). "Here, precedent has established that a custodian of firearms owes a duty to act with reasonable care to see that the weapons do not fall into the hands of people known to be dangerous." City of Gary ex rel. King v. Smith & Wesson Corp., 801 N.E.2d 1222, 1241–42 (Ind.2003). In Estate of Heck, our supreme court recognized a duty on the part of an owner of a gun to exercise reasonable care to prevent the weapon from falling into hands known to be dangerous. Estate of Heck, 786 N.E.2d at 270. As such, KS...