Modern Office Methods, Inc. v. State Univ.

• Decision Date: 09 August 2012
• Docket Number: No. 11AP–1012.,11AP–1012.
• Citation: 975 N.E.2d 523,2012 -Ohio- 3587
• Parties: MODERN OFFICE METHODS, INC., Plaintiff–Appellant, v. The OHIO STATE UNIVERSITY, Defendant–Appellee.
• Court: Ohio Court of Appeals

975 N.E.2d 523

2012 -Ohio- 3587

MODERN OFFICE METHODS, INC., Plaintiff–Appellant,

v.The OHIO STATE UNIVERSITY, Defendant–Appellee.

No. 11AP–1012.

Court of Appeals of Ohio,

Tenth District, Franklin County.

Decided Aug. 9, 2012.

Keating Meuthing & Klekamp PLL, Joseph L. Trauth, Jr. and Charles M. Miller, Cincinnati, for appellant.

Michael DeWine, Attorney General, Craig Barclay and James E. Rook, for appellee.

CONNOR, J.

{¶ 1} Plaintiff-appellant, Modern Office Methods, Inc. (“MOM”), appeals from a judgment entry entered by the Court of Claims of Ohio dismissing MOM's complaint against defendant-appellee, The Ohio State University (“OSU”), requesting declaratory and injunctive relief, as well as monetary damages, due to lack of subject-matter jurisdiction. Because we find the dismissal of the complaint was proper, we affirm.

{¶ 2} MOM is an Ohio business dealing in office equipment sales and leasing. OSU is an instrumentality of the state of Ohio. MOM has a business relationship with OSU and has been serving OSU for more than 20 years. At the time of the filing of the complaint, MOM leased approximately 750 multi-functional machines to OSU. On January 19, 2011, OSU issued a “request for proposal” (“RFP”) requesting proposals for the lease and maintenance of approximately 1,100 multi-functional devices capable of printing, copying, scanning and faxing, and for the maintenanceof up to an additional 4,800 multi-functional devices, as well as 331 facsimiles. The RFP provided three options for responding. A proposer could respond under any of the three options or all of the options.

{¶ 3} MOM submitted a proposal but was not selected as the successful responder. MOM's pricing proposal was approximately $1,000,000 more than the second low responder and approximately $1,200,000 higher than that of ComDoc, Inc. (“ComDoc”), who was ultimately the successful responder.

{¶ 4} MOM contends that its submitted bid made several specific assumptions as to the pricing and the term of the contract with OSU and claims its bid would have been different if those assumptions changed. Because the contract awarded to ComDoc contained terms substantially and materially different from those set forth in the RFP, and because the memorandum of understanding executed between OSU and ComDoc allowed for the early termination of existing leases (including devices leased from MOM) if it would result in a cost savings to OSU, MOM formally protested the award of the contract to ComDoc, claiming it violated the RFP process. Because of the numerous material changes between the RFP and the memorandum of understanding, MOM argued the contract should be re-bid. However, OSU denied the protest and refused to re-issue the RFP.

{¶ 5} Consequently, on September 26, 2011, in the Court of Claims of Ohio, MOM filed a verified complaint for damages, declaratory judgment, and injunctive relief, asserting the following three causes of action: (1) declaratory judgment—violation of competitive sealed proposal procedures; (2) breach of contract; and (3) injunctive relief. On that same date, MOM filed a motion for preliminary injunction. A hearing was scheduled by the court for a temporary restraining order and it was set to take place on September 28, 2011. On that date, during the course of the hearing, MOM withdrew its motion for a temporary restraining order and orally moved the court to set an evidentiary hearing on its motion for a preliminary injunction. The Court of Claims scheduled that hearing for October 19–20, 2011.

{¶ 6} On October 11, 2011, OSU filed a combined motion to dismiss, motion for summary judgment, and memorandum contra to MOM's request for injunctive relief and motion for preliminary injunction. On October 18, 2011, MOM and OSU filed a joint motion to continue the October 19–20, 2011 hearing date for MOM's preliminary injunction. On that same date, the Court of Claims filed an entry of dismissal, dismissing MOM's complaint on the grounds that the court lacked subject-matter jurisdiction. Within that same entry, the Court of Claims denied MOM's motion for a preliminary injunction and collectively denied all other pending motions as moot.

{¶ 7} On October 20, 2011, MOM filed a motion for reconsideration. On November 2, 2011, OSU filed its memorandum contra. On November 8, 2011, MOM filed a reply. On November 15, 2011, the Court of Claims filed an entry denying MOM's motion for reconsideration. This timely appeal now follows in which MOM asserts two assignments of error for our review:

I. The Court of Claims erred when it dismissed the complaint, sua sponte, for lack of jurisdiction.

II. The Court of Claims erred when it refused to consider Plaintiff–Appellant's motion for reconsideration.

{¶ 8} “An appellate court reviews an appeal of a dismissal for lack of subject-matter jurisdiction under a de novo standardof review.” Crable v. Ohio Dept. of Youth Servs., 10th Dist. No. 09AP–191, 2010-Ohio-788, 2010 WL 740141, ¶ 8.Civ.R. 12(B)(1) permits dismissal of the complaint where the trial court lacks jurisdiction over the subject matter of the action. Guillory v. Ohio Dept. of Rehab. & Corr., 10th Dist. No. 07AP–861, 2008-Ohio-2299, 2008 WL 2026101, ¶ 6. “The standard for determining a Civ.R. 12(B)(1) motion to dismiss for lack of subject matter jurisdiction is whether the complaint states any cause of action cognizable in the forum.” Univ. of Toledo v. Ohio State Emp. Relations Bd., ––– Ohio App.3d ––––, 2012-Ohio-2364, 971 N.E.2d 448, ¶ 8, citing Crable at ¶ 8. “Subject-matter jurisdiction relates to the proper forum for an entire class of cases, not the particular facts of an individual case.” Rowell v. Smith, 10th Dist. No. 10AP–675, 2011-Ohio-2809, 2011 WL 2407746, ¶ 17, citing State v. Swiger, 125 Ohio App.3d 456, 462, 708 N.E.2d 1033 (9th Dist.1998). “A trial court has subject-matter jurisdiction over a case if it has the statutory or constitutional power to adjudicate the case.” Kormanik v. Cooper, 195 Ohio App.3d 790, 2011-Ohio-5617, 961 N.E.2d 1187, ¶ 23 (10th Dist.), citing Pratts v. Hurley, 102 Ohio St.3d 81, 2004-Ohio-1980, 806 N.E.2d 992, ¶ 11.

{¶ 9} A motion to dismiss under Civ.R. 12(B)(6) for failure to state a claim is procedural and tests the sufficiency of the complaint. Volbers–Klarich v. Middletown Mgt., Inc., 125 Ohio St.3d 494, 2010-Ohio-2057, 929 N.E.2d 434, ¶ 11, citing Assn. for the Defense of the Washington Local School Dist. v. Kiger, 42 Ohio St.3d 116, 117, 537 N.E.2d 1292 (1989); State ex rel. Hanson v. Guernsey Cty. Bd. of Commrs., 65 Ohio St.3d 545, 548, 605 N.E.2d 378 (1992). Dismissal for failure to state a claim upon which relief can be granted is proper if, after all factual allegations are presumed to be true and all reasonable inferences are made in favor of the non-moving party, it appears beyond doubt from the complaint that the plaintiff could prove no set of facts warranting the requested relief. State ex rel. Turner v. Houk, 112 Ohio St.3d 561, 2007-Ohio-814, 862 N.E.2d 104, ¶ 5;O'Brien v. Univ. Community Tenants Union, Inc., 42 Ohio St.2d 242, 327 N.E.2d 753, syllabus (1975). A court of appeals reviews the dismissal of a complaint pursuant to Civ.R. 12(B)(6) under a de novo standard. Woods v. Riverside Methodist Hosp., 10th Dist. No. 11AP–689, 2012-Ohio-3139, 2012 WL 2759260, ¶ 9. The principles controlling a Civ.R. 12(B)(6) motion to dismiss for failure to state a claim are similar to those governing a Civ.R. 12(B)(1) motion to dismiss for lack of subject-matter jurisdiction. Blankenship v. Cincinnati Milacron Chems., Inc., 69 Ohio St.2d 608, 610, 433 N.E.2d 572 (1982) (overruled in part on other grounds); Gambee v. Gambee, 2d Dist. No. 82–CA–45, 1983 WL 4930 (Aug. 11, 1983).

{¶ 10} “The Court of Claims is a court of limited jurisdiction.” Windsor House, Inc. v. Ohio Dept. of Job and Family Servs., 10th Dist. No. 11AP–367, 2011-Ohio-6459, 2011 WL 6296623, ¶ 15. The Court of Claims has exclusive jurisdiction over civil actions against the state for money damages sounding in law. R.C. 2743.02 and 2743.03; see also Windsor House at ¶ 15. “R.C. 2743.03(A)(2) provides that when a claim for a declaratory judgment, injunctive relief, or other equitable relief against the state arises out of the same circumstances giving rise to a civil action over which the Court of Claims otherwise would have jurisdiction, the Court of Claims has exclusive, original jurisdiction to hear and determine that claim.” Interim Healthcare of Columbus, Inc. v. Ohio Dept. of Admin. Servs., 10th Dist. No. 07AP–747, 2008-Ohio-2286, 2008 WL 2025153, ¶ 13, citing Friedman v. Johnson, 18 Ohio St.3d 85, 87, 480 N.E.2d 82 (1985).

{¶ 11} While the Court of Claims specifically stated it was dismissing this case, pursuant to its authority under Civ.R. 12(H)(3), due to lack of subject-matter jurisdiction, the trial court did so after reviewing the legitimacy of MOM's claim for monetary damages, based upon Meccon, Inc. v. Univ. of Akron, 126 Ohio St.3d 231, 2010-Ohio-3297, 933 N.E.2d 231, and subsequently determining MOM could not rely on Meccon's principles in this case to allege a monetary damages claim.¹ Because the Court of Claims has jurisdiction to hear claims for declaratory and injunctive relief where there is also a claim for money damages arising out of the same circumstances giving rise to a civil action over which it otherwise has jurisdiction, and because the instant complaint alleges such causes of action, the complaint states causes of action cognizable in the forum if it properly sets forth a claim for money damages. However, if MOM can prove no set of facts entitling it to recover money damages, the complaint fails to state a claim upon which relief can be granted, and consequently, without a proper claim for damages, the Court of Claims lacks subject-matter jurisdiction to hear the other causes of action.

{¶ 12} Therefore, because the two are intertwined, we approach this case under a combined failure to...