Citizens Nat. Bank of Grant County v. First Nat. Bank in Marion

Decision Date23 July 1975
Docket NumberNo. 2--773A172,2--773A172
Citation331 N.E.2d 471,165 Ind.App. 116
Parties, 1975-2 Trade Cases P 60,515 CITIZENS NATIONAL BANK OF GRANT COUNTY, a National Banking Association, formerly the Van Buren Bank, a State Banking Association, Appellant, v. FIRST NATIONAL BANK IN MARION, a National Banking Association, et al., Appellees.
CourtIndiana Appellate Court

Wasson J. Wilson, Fred G. Donnersberger, Wilson, Benne, Feingold & Donnersberger, Hammond, J. A. Bruggeman, Robert S. Walters, Barrett, Barrett & McNagny, Fort Wayne, Frank J. Biddinger, Biddinger & Johnson, Marion, Ned R. Carnall, Bluffton, for appellant.

George P. Osborn, Kim A. Rogers, Kiley, Osborn, Kiley & Harker, Marion, Harry T. Ice, James E. Hawes, Jr., Ice, Miller, Donadio & Ryan, Indianapolis, Edris, Edris & Dale, Gallivan & Hamilton, Bluffton, Thomas L. Morin, Marion, McHale, Cook & Welch, Indianapolis, for appellees.

SULLIVAN, Presiding Judge.

Citizens National Bank appeals from dismissal of its complaint pursuant to Ind. Rules of Procedure, Trial Rule 12(B)(6).

Because the complaint herein was dismissed prior to any discovery or reception of evidence, the record before us is somewhat scant. However, for background purposes, the following facts, discernible from prior federal litigation, 1 are worthy of note.

Citizens National Bank (Citizens) was formerly the Van Buren Bank, a state bank located in Van Buren in Grant County, Indiana. First National Bank and Marion National Bank (Defendants) are national banks located in Marion in Grant County.

Prior to 1966, the directors of Citizens had attempted to establish a bank in Marion in competition with Defendants. These attempts were unsuccessful.

On July 19, 1966, Citizens filed applications with the United States Comptroller of the Currency seeking to convert the Van Buren Bank from a state to a national bank, to transfer its main office to Marion, and to retain the Van Buren office as a branch office.

The Comptroller solicited the opinions of the Defendants as to the applications. Both voiced their objection to the opening of the new 'branch' in Marion. Notwithstanding these objections, the Comptroller granted preliminary approval of the applications. 2 Defendants then instituted an action in the Federal District Court for the Northern District of Indiana, seeking to enjoin the granting of the necessary authority. The issues in that case revolved around then existing Ind.Ann.Stat. § 18--1707 (Burns 1964) 3 which by virtue of population classification, as to the City of Marion, barred any state bank from establishing a branch in any city or town already served by ane xisting bank. Concomitantly, Federal law did then and does now provide that national banks may open branch offices only in locations where state law would permit a state bank to do so. 4

The Federal District Court determined that Citizens' denomination of its proposed new facility as a 'Main Office' did not change the essential characteristics of the applications and that the purpose of the transaction was to open a branch in Marion. The court enjoined the Comptroller from granting the applications. Marion National Bank of Marion v. Saxon (N.D.Ind.1966), 261 F.Supp. 373.

The District Court's decision was modified on appeal by the Seventh Circuit Court of Appeals. Marion National Bank of Marion v. Van Buren Bank (7th Cir. 1969), 418 F.2d 121. Both parties now assert that the appellate decision was a vindication of their respective positions. We need not concern ourselves with this dialectic. Suffice it to say that under the modified injunction, Citizens was eventually granted the authorization they desired, and on or about March 2, 1970, Citizens opened a national bank office in Marion.

On February 18, 1971, Citizens instituted the present action in Grant County Superior Court against the defendant banks and their directors. The complaint is central to the issues on appeal. We therefore quote it in its entirety:

'Plaintiff alleges:

1. That the Plaintiff is now a national banking association, having been given authority by the Comptroller of the Currency of the United States to convert from an Indiana state chartered bank to a national banking association, and having been given authority by the Comptroller of the Currency of the United States to change its name from 'The Van Buren Bank' to 'Citizens National Bank of Grant County'.

2. That on or about the 7th day of October, 1966, pursuant to adjudicatory procedures, the Comptroller of the Currency of the United States granted to and approved plaintiff's applications to convert the Van Buren Bank from a state banking association into a national banking association; to change the name of the bank from 'The Van Buren Bank' to 'Citizens National Bank of Grant County'; to relocate its main office from the town of Van Buren to an on the square location in Marion, Indiana; and to retain the former office in the town of Van Buren as a branch bank.

3. That on or about the 19th day of October, 1966, the defendants, themselves and through their respective boards of directors, pursuant to agreement, following a continuing course of conduct, and pursuant to a scheme, design, understanding, contract, combination and conspiracy to restrain trade and commerce in the banking business in Marion, Indiana and its environs, brought an action in the United States District Court for the Northern District of Indiana, Fort Wayne Division (Cause No. 1822), seeking to enjoin and prevent plaintiff from lawfully entering the banking business in the City of Marion and its environs.

4. Defendants instituted and maintained said action in the United States District Court with the intent and design, and by concerted action to monopolize or attempt to monopolize, or to maintain and perpetuate an existing monopoly position, in the banking business within the City of Marion and its environs.

5. Prior to the commencement of their U.S. District Court proceedings, defendants, acting in concert and with the purposes and intent set forth in paragraphs 3 and 4 of this complaint, intervened in the adjudicatory proceedings before the Comptroller of the Currency of the United States and sought to cause him to deny plaintiff the administrative authority to remove its banking business to Marion, Indiana, all in furtherance of defendants' scheme, design, undertaking, contracting, combination and conspiracy to restrain trade or commerce and to maintain and perpetuate a monopoly in the banking business in the City of Marion and its environs.

6. Defendants acted in concert and with the purposes and intent set forth in paragraphs 3 and 4 of this complaint, to do other acts and things in furtherance of their object of preventing plaintiff or any other person or company from entering into the banking business in the City of Marion and its environs.

7. On the 24th day of Feb., 1970, the Comptroller of the Currency of the United States granted authority to The Van Buren Bank to commence business as a national banking association under the title 'Citizens National Bank of Grant County', effective as of the commencement of business on March 2, 1970, to be located in Marion, State of Indiana.

8. Subsequently thereto the Comptroller of the Currency granted approval to the Citizens National Bank of Grant County to establish and maintain a branch bank in Van Buren, Indiana, at the old offices of the Van Buren Bank in Van Buren.

9. That by virtue of the scheme and design and concerted action of these named defendants, plaintiff, Citizens National Bank of Grant County was denied the right and franchise to lawfully conduct the business of banking in Marion, Indiana, from the 19th day of October, 1966, up to and including the 2nd day of March, 1970, and that this plaintiff was therefore and thereby as a proximate result of the attempt to monopolize and restrain the banking business in the City of Marion by these defendants, damaged and injured in its business and property to the extent that it lost profits that would normally have been derived from the normal conduct of banking business in Marion, for a period of approximately three and one-half years.

10. Plaintiff has been damaged by loss of profits occasioned by the scheme of interference, monopoly and restraint of trade by these named defendants, which normal profits and growth during this period of time would normally be anticipated to amount to a minimum of Two Hundred Seventy-two Thousand Six Hundred Twenty-five ($272,625.00) Dollars per year, and that therefore this plaintiff, for a period of three and one-half years has been damaged to the extent of Eight Hundred Fifty-two Thousand ($852,000.00) Dollars.

11. That this plaintiff, by virtue of the scheme and design and maintenance of the litigation by these named defendants, was required to obtain the services of counsel to defend it and therefore and thereby was forced to incur the expense of counsel as well as all attendant expenses of litigation and therefore sustained additional money damages.

12. That this action is brought as a private action for damages pursuant to Burns' Indiana § 23--122 (IC 1971, 24--1--2--7) and plaintiff is therefore and thereby entitled to treble damages for the injury to its business and property by reason of the conduct of defendants, and each of them, and plaintiff is therefore entitled to treble damages together with costs of suit in addition to attorneys fees for the bringing of this action.

WHEREFORE, plaintiff demands judgment of the defendants and each of them, in the sum of Two Million Eight Hundred Fifty Thousand ($2,850,000.00) Dollars; its costs herein expended; reasonable attorneys fees for bringing this action; and prays that the court grant any and all other proper relief.'

On March 8, 1971, Defendants filed a petition for removal of the case to the Federal District Court, Northern District of Indiana. Following assumption of jurisdiction by the Federal Court,...

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