II v. Commissioner, Indiana Department of Environmental Management, Appellee-Respondent (2026)

MEMORANDUM DECISION

[1] Edwin Blinn spent eight years and hundreds of thousands of dollars defending his family farm, Bankview Farm II (Bankview), against an environmental enforcement action brought by the Indiana Department of Environmental Management (IDEM). Though administrative review affirmed IDEM's enforcement action, Bankview ultimately prevailed on judicial review in the trial court, and the enforcement action was rescinded.

[2] Bankview then requested attorney fees, claiming that IDEM engaged in litigation misconduct when it continued to defend the allegedly baseless enforcement action. The trial court awarded Bankview $10,000 in fees. Bankview appeals, arguing that the trial court wrongly applied a statutory cap to the misconduct-based fees it sought. But Bankview's argument misconstrues the fee order, which did not award misconduct-based fees but imposed fees on a different, unchallenged basis. We affirm.

Facts

[3] Beginning in 2010, Blinn set out to clear a roughly 23-acre parcel of semi-wooded land (“the subject parcel”) on his farm. Before he began, Blinn reviewed two wetland surveys. Neither survey labeled the subject parcel as a wetland, though wetlands existed on other parts of the Bankview property, including land adjacent to the subject parcel. Blinn confirmed his reading of the maps with local natural resource conservation officials. Blinn then proceeded to clear the parcel.

[4] In the fall of 2015, IDEM received an anonymous complaint that Blinn had cleared land that might be a wetland. IDEM personnel visited the Bankview property in November 2015 to investigate, but Blinn ordered them to leave the property because he had not been given prior notice. IDEM inspector Heather Parsons later returned in January 2016 to make a wetland determination.

[5] Parsons used various techniques to assess the land for three standard wetland indicators relating to soils, vegetation, and hydrology features. Typically, the presence of all three indicators is required to make a wetland determination. However, the subject parcel qualified as an “atypical” site because it had already been disturbed and cleared of vegetation. App. Vol. II, p. 71. Atypical sites require the presence of just two of the three indicators, according to IDEM practice. Parsons ultimately determined that the subject parcel was a wetland.

[6] Based on this determination, IDEM issued a Notice of Violation to Bankview in May 2018 for clearing a wetland without a permit. This was followed by a Commissioner's Order in November 2018, which imposed a civil penalty of $26,750 and required Bankview to restore the property to its pre-clearing condition. IDEM estimated that restoration could cost more than $3 million.

[7] Bankview timely appealed the Commissioner's Order to the Office of Environmental Adjudication (OEA). During discovery in early 2019, Bankview deposed multiple IDEM personnel about the agency's wetland evaluation procedures. Those depositions revealed that IDEM's policy was to follow a wetland delineation manual from the United States Army Corps of Engineers, but IDEM's policies were not written down or promulgated as an administrative rule. The parties also litigated whether Parsons's inspection was compliant with IDEM policies and discussed the forms Parsons used, the factors she assessed, and the appropriateness of an assessment made in the wintertime when vegetation is minimal. IDEM representative Jason Randolph testified that wetland assessments could be conducted in the wintertime, though it must be done “very cautiously” because it is “hard to identify plants in the winter.” Id. at 74 (quoting administrative record).

[8] Bankview moved for summary judgment, arguing that IDEM had illegally applied an unwritten rule, violated its own procedures during the inspection, and denied Bankview due process in doing so. An environmental law judge from the OEA denied the motion, characterizing Bankview's legal arguments as fact-sensitive issues requiring further development. The enforcement action proceeded.

[9] In preparation for a final evidentiary hearing, the parties stipulated that the sole remaining question was whether wetlands were actually present at the site. Before the hearing, Bankview discovered that IDEM representative Randolph had provided testimony in a separate enforcement administrative proceeding that appeared to contradict the statements given in the instant proceeding. In the other proceeding, Randolph testified that wetland data points are not taken in the wintertime; here, Randolph testified that wetland inspections can occur during the wintertime, though cautiously.

[10] OEA ultimately ruled in favor of IDEM, affirming the Commissioner's Order. OEA found that IDEM acted consistently with its historical practice and had not promulgated an illegal rule contrary to law. Though OEA determined that IDEM failed to follow several procedures for assessing vegetation, it found that vegetation analysis was not necessary because the site was atypical.

[11] Bankview filed for judicial review in the trial court in July 2023. After briefing and oral argument, the trial court reversed the OEA judgment, taking issue with various aspects of the IDEM inspection and finding that IDEM had engaged in “an extended game of ‘hide the ball.’ ” Id. at 79. For instance, the court found that IDEM's unwritten procedures for wetland determinations constituted an agency rule—not an adjudication, as IDEM argued—and should have moved through the rule-making process. The court also found that IDEM departed from its own procedures in various ways. Though IDEM argued that the winter inspection was necessary to prevent further damage to the land and to assess conditions close in time to the disturbance, the trial court found IDEM had other options to achieve those goals.

[12] IDEM did not appeal that decision and rescinded the Commissioner's Order, thereby ending the enforcement action. Bankview then moved for attorney fees. It sought recovery under three theories related to litigation misconduct.¹ Bankview argued that IDEM wrongly pursued a baseless enforcement action from the start or, at minimum, from the close of discovery, when fatal flaws in the action were exposed.

[13] In response, IDEM argued that Bankview had not met the high burden required for any of the misconduct-based theories, noting that it had received favorable decisions from OEA along the way. In the alternative, IDEM claimed that fees against a state agency in a judicial review proceeding were capped at $10,000 under Indiana Code § 34-52-2-4.

[14] In the trial court's fee order, the court acknowledged that Bankview requested fees under three misconduct-based fee theories but determined that, under Indiana caselaw, “these powers did not extend to an award of fees against a State entity, because the intended deterrent effect of punitive fees would not be effective against the State.” App. Vol. II, p. 158. The court then discussed Indiana Code § 34-52-2-1 et seq., which permits a prevailing party to recover up to $10,000 against the State in some situations. The court awarded Bankview $10,000 in fees against IDEM.

[15] Bankview then filed a motion to correct error, claiming that the caselaw relied upon by the court had been effectively overruled and arguing that the $10,000 statutory cap does not apply to misconduct-based fees. The court denied Bankview's motion to correct error, disagreeing with its analysis of the relevant caselaw. The court also noted an alternative basis for its ruling, writing:

Even if such an award would be available, the Court would not find IDEM's conduct to be sufficiently wrongful under an obdurate behavior or bad faith analysis to award fees. IDEM was successful in its litigation before the agency and thus was the Respondent in this case. Its conduct on administrative appeal was not out of bounds and the legal and factual arguments made by it, while not ultimately successful, were within the bounds of appropriate advocacy. Its decision to defend its successful outcome in the agency on administrative appeal was in no way unreasonable.

App. Vol. II, p. 173. Bankview appeals the court's attorney fees order, which capped the fees at $10,000.

Discussion and Decision

[16] We review attorney fee awards for an abuse of discretion. River Ridge Dev. Auth. v. Outfront Media, LLC, 146 N.E.3d 906, 912 (Ind. 2020). “An abuse of discretion occurs when the court's decision either clearly contravenes the logic and effect of the facts and circumstances or misinterprets the law.” Id.

[17] On appeal, Bankview presents its argument as a single legal question: whether the $10,000 cap on fees outlined in Indiana Code § 34-52-2-4 applies to fees awarded for litigation misconduct. This framing relies on Bankview's reading of the trial court's fee order as awarding misconduct-based fees but capping them at $10,000. In fact, Bankview argues that the trial court “agreed that Bankview had triggered [the litigation misconduct] standard and that fee recovery was warranted” but capped pursuant to Indiana Code § 34-52-2-4. Appellant's Br., p. 27 (citing App. Vol. II, pp. 158-59).

[18] However, IDEM responds that Bankview “misunderstood the trial court's order” and therefore poses an “irrelevant question.” Appellee's Br., pp. 12, 15. IDEM contends that the court rejected Bankview's request for misconduct-based fees and instead imposed fees pursuant to Indiana Code § 34-52-2, at its maximum of $10,000. Thus, the trial court did not cap misconduct-based fees at $10,000 because it never awarded misconduct-based fees.

[19] In its reply brief, Bankview doubles down and accuses IDEM of asking this Court to “short circuit and avoid the actual issue.” Appellant's Reply Br., p. 6. Bankview insists the fees awarded must have been misconduct-based fees, though it later contends that the trial court's orders “never invoke or specify the grounds under which they award fees.” Id.

[20] A plain reading of the fee order is consistent with IDEM's view—that the trial court did not award misconduct-based fees. The fee order lists the three misconduct-based fee theories requested by Bankview before stating that “traditionally these powers did not extend to an award of fees against a State entity ․ which ‘does not have a mind that can be deterred by an award of punitive damages.’ ” App. Vol. II, p. 158 (quoting Fam. & Soc. Servs. Admin. v. Calvert, 672 N.E.2d 488, 495 (Ind. Ct. App. 1996) and citing State v. Person, 699 N.E.2d 783 (Ind. Ct. App. 1998)).

[21] The fee order then pivots to Indiana Code § 34-52-2, specifying:

In an apparent response to Calvert and Person, in 1998 the General Assembly enacted I.C. 34-52-2, which permits fees to be awarded against the State for certain purposes, and subject to certain limitations, including following a proceeding (like this one) to judicially review a final order made by a state agency under I.C. 4-21.5-5. I.C. 34-52-2-1(a)(1). The statutes were materially amended in 2023 to broaden the available relief, but those amendments do not apply to this action, which was commenced before June 30, 2023. I.C. 4-21.5-2-8.

As such, the pre-2023 version of the statutes clearly limits the amount awarded for fees to $10,000. I.C. 34-52-2-4. Mindful of that limitation, and applying the standard for appropriateness of fees, the Court awards fees in the amount of $10,000 in favor of Bankview and against IDEM.

Id. at 159.

[22] Given the trial court's clear rejection of misconduct-based fees and its subsequent discussion of fees under Indiana Code § 34-52-2, it is clear that fees were awarded under the latter provision. The fee order cannot reasonably be read to award fees under any misconduct-based theory, as Bankview argues. This is further confirmed by the order denying Bankview's motion to correct error, which adds an alternative finding: “Even if such an award would be available, the Court would not find IDEM's conduct to be sufficiently wrongful under an obdurate behavior or bad faith analysis to award fees.” Id. at 173.

[23] Because the fee order did not impose misconduct-based fees, Bankview's argument—that misconduct-based fees cannot be capped at $10,000—is without a premise. Bankview's question is thus irrelevant and hypothetical, and to resolve it would constitute an impermissible advisory opinion. See Snyder v. King, 958 N.E.2d 764, 786 (Ind. 2011) (“[A] cardinal principle of the judicial function is that courts should not issue advisory opinions but instead should decide cases only on the specific facts of the particular case and not on hypothetical situations.”).

[24] The actual basis for the fees remains unchallenged, as Bankview recognizes that the $10,000 cap set out in Indiana Code § 34-52-2-4 certainly applies to fees awarded under Indiana Code § 34-52-2. IDEM does not dispute the appropriateness of the $10,000 fee awarded here under Indiana Code § 34-52-2. We therefore affirm.

FOOTNOTES

1.   Bankview also requested fees under Indiana Trial Rule 37(A)(4), claiming it had prevailed on a protective order motion during the OEA proceedings. The trial court's fee order did not address this request, and Bankview does not raise any argument pertaining to it on appeal.

Weissmann, Judge.

Tavitas, C.J., and Foley, J., concur.