United States District Court, S.D. Indiana, Indianapolis Division
RED BARN MOTORS, INC., PLATINUM MOTORS, INC., MATTINGLY AUTO SALES, INC., and YOUNG EXECUTIVE MANAGEMENT & CONSULTING SERVICES, INC., individually and on behalf of other members of the general public similarly situated, Plaintiffs,
NEXTGEAR CAPITAL, INC. f/k/a DEALER SERVICES CORPORATION, COX ENTERPRISES, INC., COX AUTOMOTIVE, INC., and JOHN WICK, Defendants.
ORDER ON PLAINTIFFS' MOTION FOR LEAVE TO FILE
WALTON PRATT, JUDGE
matter is before the Court on a Motion for Leave to File
Surreply in Opposition to Defendants' Motion to Dismiss
filed by Plaintiffs Red Barn Motors, Inc., Platinum Motors,
Inc., Mattingly Auto Sales, Inc., and Young Executive
Management & Consulting Services, Inc. (collectively
“Plaintiffs”) (Filing No. 137).
“purpose for having a motion, response and reply is to
give the movant the final opportunity to be heard and to
rebut the non-movant's response, thereby persuading the
court that the movant is entitled to the relief requested by
the motion.” Lady Di's, Inc. v. Enhanced Servs.
Billing, Inc., 2010 U.S. Dist. LEXIS 29463, at *4 (S.D.
Ind. Mar. 25, 2010). However, “new arguments and
evidence may not be raised for the first time in a reply
brief. Reply briefs are for replying, not raising new
arguments or arguments that could have been advanced in the
opening brief.” Reis v. Robbins, 2015 U.S.
Dist. LEXIS 23207, at *5 (S.D. Ind. Feb. 26, 2015) (citations
omitted). “[T]his serves to prevent the nonmoving party
from being sandbagged.” Id. (citation
omitted). Courts allow a surreply only in limited
circumstances to address new arguments or evidence raised in
the reply brief or objections to the admissibility of the
evidence cited in the response. See, e.g.,
id.; Miller v. Polaris Labs., LLC, 2014
U.S. Dist. LEXIS 18161 (S.D. Ind. Feb. 12, 2014).
and 2011, the Plaintiffs entered into agreements with
Defendant NextGear Capital, Inc., formerly known as Dealer
Services Corporation. These agreements provided lines of
credit for financing the Plaintiffs' used car dealership
operations. When the Plaintiffs discovered that they had been
charged fees and interest on money that had not yet actually
been loaned, they initiated this litigation, asserting claims
for breach of contract, constructive fraud, tortious
interference with business relationships, unjust enrichment,
violation of the Racketeer Influenced and Corrupt
Organizations Act (“RICO”), 18 U.S.C. § 1961
et seq., and RICO conspiracy. The
Defendants-NextGear Capital, Inc., Cox Enterprises, Inc., Cox
Automotive, Inc., and John Wick-moved to dismiss the
Plaintiffs' Amended Complaint.
Defendants asserted numerous bases for dismissal, but their
primary argument was that the terms of the contracts allowed
the Defendants to charge fees and interest at the time that
they did actually charge fees and interest. The Plaintiffs
responded that the language of the contracts did not permit
the early assessment of fees and interest, and if nothing
else, there is an ambiguity in the contracts that prohibits
termination of the case at the motion to dismiss stage. The
Defendants replied to this argument, and the Plaintiffs
sought leave to file a surreply brief, asserting that the
Defendants' Reply Brief raised a new issue regarding
contract interpretation (Filing No. 137-1).
their proposed surreply, the Plaintiffs assert that the
Defendants' interpretation of the contracts is not
supported by the language of the contracts. They explain that
no contract provision has been identified that supports the
Defendants' interpretation, and the Defendants'
reliance on new “evidence” or
“argument”-a definition of “loan”
from Black's Law Dictionary-suggests that there are
ambiguities in the contracts, prohibiting dismissal at this
stage of the litigation.
response to the Plaintiffs' Motion for Leave to File
Surreply, the Defendants explain that they have argued since
their opening brief that the Plaintiffs' allegations and
theories of recovery contradict the plain language of the
parties' contracts. Thus, the Plaintiffs' proposed
surreply does not respond to new arguments or issues raised
in the Defendants' Reply Brief. Rather, the Plaintiffs
asserted contract interpretation arguments in their Response
Brief, and the Defendants simply replied to those arguments
with legal and secondary authority regarding the meaning of
words in the contracts. The Defendants assert that they added
no factual or legal arguments or evidence extraneous to the
parties' agreements or the Plaintiffs' own
allegations. Therefore, there is no basis to allow a
close review of the parties' briefing, the Court
determines that the Defendants' Reply Brief did not
inject new evidence, arguments, or issues into the Motion to
Dismiss. Instead, the Reply Brief provided the
Defendants' response to the arguments advanced by the
Plaintiffs in their Response Brief. The limited circumstances
for allowing a surreply-to address new arguments or evidence
raised in the reply brief-are not present in this case, and
as a result, the Court DEN ...