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 Town's Insurer Files Petition for Rehearing

April 16, 2008 - A final resolution to a public access lawsuit the town of Knightstown lost to The Banner nearly two years ago will have to wait a while longer.

Attorneys for the town of Knightstown's insurer filed a petition Monday afternoon, the final day they could do so, asking the Indiana Court of Appeals for a rehearing with respect to a ruling made last month. The petition claims the Court of Appeals failed to address the insurer's arguments, made on cross-appeal, that it should not be responsible for any of the Banner's attorney fees, court costs and other related expenses.

In its March 14 ruling, the Court of Appeals ordered the case sent back to Henry Circuit Court Judge Mary Willis, instructing her to clarify her March 2007 order on attorney fees and court costs that was the subject of the appeal. Citing inconsistencies in Willis' order, the Court of Appeals said clarification was needed to determine if an error Willis made in calculating attorney fees for an earlier appeal The Banner won in 2005 had been harmless.

While it addressed The Banner's and the town's arguments over the amount of attorneys fees and court costs Willis had ordered, the Court of Appeals opinion did not address issues the town's insurer had raised on cross-appeal. The town's insurer is now asking the Court of Appeals to rule on whether Willis erred in holding it jointly and severally liable with the town for the newspaper's attorney fees and court costs.

In their cross-appeal, attorneys for the town's insurer claimed the insurer is not a public agency and, therefore, is not liable for attorney fees and costs awarded to The Banner under the state's Access to Public Records Act. They say the Court of Appeals' 2005 ruling did not reverse Willis' earlier determination that the insurer was not a public agency.

The insurer's attorneys say The Banner "undeniably failed to obtain any judgment or decree" against the insurer. For that reason, they say the newspaper did not substantially prevail against the insurer, something that has to happen before attorney fees and costs can be awarded under the APRA.

Attorneys for the insurer also dispute Willis' finding that the insurer was a necessary party to The Banner's underlying lawsuit, which sought a copy of the 2003 settlement agreement that ended a former dispatcher's lawsuit against the town and its police department. They claim it was not necessary for The Banner to sue the town's insurer as part of its efforts to get a copy of the settlement.

"Banner decided to interject (the insurer) in this case," attorney Stephen Peters said in the petition filed Monday. "Having lost on the fundamental premise for its APRA claims against them, the award of fees against (the insurer) is without basis and should be reversed."

Because the insurer is seeking a rehearing on the Court of Appeals' latest ruling, the case will not be immediately returned to Willis for clarification of her March 2007 order. That will not happen until after the Court of Appeals rules on the rehearing request.

If the insurer is successful in persuading the Court of Appeals to reverse Willis' ruling holding them jointly and severally liable with the town for attorney fees and costs, the town will be solely responsible. While Willis awarded The Banner $67,612.46 in fees and costs in her March 2007 order, that amount could decrease or increase depending on how she clarifies her earlier ruling.


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