Court Opinion

ID: 2961178
Source: CourtListenerOpinion
Date Created: 2015-09-21 14:04:25.21432+00
Date Added: 2024-06-11T15:26:42.437373
License: Public Domain

Sep 21 2015, 9:27 am

ATTORNEY FOR APPELLANT
Zachary J. Eichel
Einterz & Einterz
Zionsville, Indiana

                                            IN THE
    COURT OF APPEALS OF INDIANA

D & D NAPA, Inc.,                                         September 21, 2015
Appellant,                                                Court of Appeals Case No.
                                                          93A02-1501-EX-58
        v.                                                Appeal from the Department of
                                                          Workforce Development
Unemployment Insurance                                    Unemployment Insurance
Appeals of the Indiana                                    Appeals
Department of Workforce                                   The Honorable Aija Funderburk,
Development,                                              Liability Administrative Law
                                                          Judge
Appellee.
                                                          Case No. 58171

Brown, Judge.

Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015               Page 1 of 23
[1]   D & D NAPA, Inc. (D & D Metal Products, Inc.) (“D & D”)1 appeals a

      decision of the Liability Administrative Law Judge (the “ALJ”) concluding that

      it was a partial successor of Chaffins Enterprises, Inc. (“Chaffins”) for the

      purpose of calculating its unemployment benefit contributions. D & D raises

      one issue, which we revise and restate as whether the ALJ erred as a matter of

      law in its conclusion. We affirm.

                                        Facts and Procedural History

[2]   D & D sells automotive parts supplied by NAPA Auto Parts and operates

      sixteen stores in Illinois and Indiana. In May 2010, D & D purchased certain

      property from Chaffins for approximately $38,077.29. According to the bill of

      sale, D & D purchased “[a]ll currently classified stock-in-trade, merchandise

      and inventories of [Chaffins’s] store, totaling [$20,798.292] or the value as

      physically inventoried prior to the closing” and “[t]he furniture, fixtures, and

      1
       At the October 14, 2014 hearing, Roger Dittrich indicated he was the president of D & D and that the
      company changed its name from D & D Metal Products, Inc., to D & D NAPA, Inc.
      2
        The bill of sale initially showed an amount of $75,000, but the amount was struck and the handwritten
      amount of $20,798.29 was inserted. Dittrich, the president of D & D, testified that the initial amount was
      based on information he was given regarding the inventory level, that at the time of purchase a physical
      inventory was completed and the actual number was $20,798.29, and that a person with NAPA’s corporate
      office inserted the handwritten figures on the bill of sale.

      Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015                     Page 2 of 23
      miscellaneous equipment used in [Chaffins’s] store . . . totaling [$17,2793].”

      Exhibits at 90.

[3]   In February 2013, Chaffins filed a Report of Inactivation with the Indiana

      Department of Workforce Development (the “DWD”) stating that it had

      discontinued operations and that the date of its last payroll was on September

      30, 2011. In March 2013, Chaffins filed the completed form “Report of

      Transfer – Complete Sale” with the DWD. Exhibits at 53. In the area to

      specify the reason for filing the form, the box next to “Other” was marked, and

      the explanation stated “lease of building” and “purchase of retail business.”4 Id.

      Chaffins indicated that the effective date of the change and the date its

      operations ceased was April 23, 2010, and that the date of its last payroll was

      April 24, 2010.

[4]   On July 5, 2013, the DWD issued a notice that it made a determination that

      there had been a complete disposition to acquirer as of December 31, 2010.5

      3
       The bill of sale initially showed an amount of $16,509, but the amount was struck and the handwritten
      amount of $17,279 was inserted.
      4
       In addition to “Other,” the options included, among others, “Sale of Complete organization” and
      “Partnership change (50% or more).” Exhibits at 53.
      5
        The DWD presented testimony that Chaffins submitted a contribution report indicating it had “payroll, one
      employee on the twelfth of the month through the fourth quarter of 2010,” that the DWD had “a lot of dates
      being used by Chaffins and no [] tangible information received from [D & D],” and that the DWD could not
      hold that the disposition occurred any earlier than December 31, 2010 “because the employer told [it] that
      through the twelfth day of December 2010 at a minimum they had one employee working.” Transcript at 57.

      Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015                    Page 3 of 23
      The DWD recalculated D & D’s employer rate to reflect the acquisition of

      Chaffins, resulting in a rate increase for D & D for 2012.

[5]   On September 10, 2013, the DWD sent notice and demand statements to D &

      D for each of the four quarters in 2012.6 Specialized Accounting Services LLC

      (“SAS”), on behalf of D & D, sent a letter dated September 13, 2013, to the

      DWD stating: “Although [Chaffins] ceased its operations and is closed, [D &

      D] did NOT acquire this business. D & D simply purchased the assets of the

      business and hired the employees.” Id. at 59. SAS sent a letter dated October

      15, 2013, to DWD stating that D & D did not purchase Chaffins and that it

      “merely purchased the remaining assets after it was closed (the assets were

      $200k) and did not even hire any of the prior employees.” Id. at 70. The letter

      also stated that D & D had acquired the assets and employees of another

      company in 2012, that the company had a much better experience rating with

      the State, and that it was expected that the information would help lower D &

      D’s rate for 2013.

[6]   On October 14, 2014, a hearing was held before the ALJ at which the parties

      appeared by counsel and presented testimony and evidence. The DWD

      presented the testimony of Jennifer Chappell, Director of U.I. Tax

      Administration for DWD, and Mary Lisa Bickley and Dawn Bottoms, audit

      examiners for DWD, and D & D presented the testimony of Roger Dittrich,

      6
          The sum of the amounts due on the four statements is $6,391.

      Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 4 of 23
      President of D & D. The ALJ admitted documentary evidence which included

      the report of transfer, records of telephone inquiries, employee wage detail

      reports, correspondence from SAS, the notice and demand statements, printouts

      of employer rate detail screens, experience balance reconciliation worksheets,

      and the bill of sale. According to a record of telephone inquiry dated

      September 13, 2013, an agent for D & D called DWD, confirmed that the

      company had purchased two stores in 2010, and asked why the company’s rate

      had increased significantly “just for taking on maybe 30” employees, and the

      DWD representative explained the timing of the acquisition and that D & D’s

      rate had been recalculated and blended with the disposer’s rate. Id. at 56.

[7]   Bickley testified that she processed the acquisition involving D & D based on

      the report of transfer and that she had spoken with Katherine Chaffins of

      Chaffins regarding the acquisition. Bickley testified that Chaffins had been

      doing business as NAPA North Judson and had an address on Talmer Avenue,

      that D & D was also an auto parts store with the same address on Talmer

      Avenue, and that D & D used the same telephone numbers used by Chaffins.

[8]   Bottoms testified that she reviewed wage detail reports and found that two

      employees who had worked for Chaffins, Kenneth Reed and Brad Chaffins,

      later worked for D & D. Bottoms testified there was a gap in employment of

      the employees and that, even where there is a gap between when employees

      stop working for a disposer and start with an acquirer, the transfer of the

      employees could indicate that there was a transfer of business. She stated that

      the DWD looks at employee movement once it receives notification there has

      Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 5 of 23
       been a sale, and that a lot of businesses will tell the DWD that the employees

       were let go and after that the other entity interviewed and rehired them, but that

       was still considered a transfer of an employee.

[9]    Chappell testified that one of her responsibilities, when an employer protests a

       determination of successorship, is to review the records and make a judgment

       call regarding whether the agency’s determination was correct based on the best

       information available under the statute. She testified that D & D did not

       dispute that there was a transfer of assets and that it had hired employees of

       Chaffins, that D & D purchased those assets and hired the employees “to

       operate the same business in the same location under the same DBA that the

       former entity had used,” that “both of these are considered Napa,” that

       Chaffins used “Napa North Judson Roger’s Precision Auto Supply,” and that

       D & D “is Napa North Judson.” Transcript at 34. She stated that Chaffins

       reported that it completely ceased its operation, and that she checks the internet

       to “see whether or not you can get from one business, the old business to the

       new business seamlessly. So that there is an appearance of continuation for

       what’s offered to the public.” Id.

[10]   Chappell further testified that an acquisition may or may not have an impact on

       the acquiring company and that a company may acquire a business with a

       lower experience balance, a higher experience balance, or the same experience

       balance. She stated the notice and demand statements are based on an

       employer’s own reporting of their taxable wages multiplied by the merit rate

       notice issued by the DWD, that the purchase of remaining assets after a

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 6 of 23
       business closes can affect the DWD’s determination in certain circumstances,

       including the nature and length of time of closure and other factors, and that the

       DWD looks at public records and determines, for intent and purpose, whether

       the new entity is a different business or essentially a continuation of all or part

       of the pre-existing business. She testified that in this case Chaffins stated it was

       in operation at the time of the acquisition, that D & D leased the building that

       Chaffins was in and took over its operations, and that in searching online for

       Roger’s Precision Auto Supply she was directed to NAPA at North Judson

       which appeared to be the business being operated by D & D.

[11]   Additionally, Chappell testified that she could not “find anything in any of the

       filings or in the public record that shows that the business, which used [to] be

       Chaffins [], Napa North Judson, Roger’s Precision Auto Supply, is not in

       actuality functioning under that same identity at this time with or without the

       same employee. If the identity continues, the business continues, there’s a

       continuation of trade or business, the statute is satisfied. There should be a

       successorship by the agency and the experience balance should follow the

       business from one owner to the other owner.” Id. at 47. Chappell also testified

       that the determination of successorship is not predicated on a transfer of the

       workforce and that the determination is whether the business trade or

       organization was continued in part or in whole and whether it is essentially the

       same business being operated regardless of whether it was operated with the

       same employees. She noted that the DWD used the case of Indianapolis

       Concrete, Inc. v. Unemployment Ins. Appeals of Indiana Dep’t of Workforce Dev., 900

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 7 of 23
N.E.2d 48 (Ind. Ct. App. 2009), in training its audit examiners, and stated that

       “everything I looked at showed that the business operated seamlessly between

       these two [entities]. That is a Napa location before. It was a Napa location

       after, and it never ceased to be a Napa location.” Id. at 69.

[12]   Dittrich testified that he was the president of D & D, he had personal

       knowledge that the amounts on the bill of sale were accurate for the value of the

       inventory of Chaffins, and that he did not purchase any right to hire employees

       or use a phone number through the bill of sale. He testified that D & D hired

       employees who were formerly employed by Chaffins and, when asked how he

       came to hire those employees, that the company had applications that anybody

       who wished could complete. He stated that he purchased the inventory of

       NAPA North Judson and that he then leased the building on Talmer Avenue

       from the Chaffins family. When asked if there were any other businesses

       operating on the property, Dittrich testified: “Yes, Roger’s Precision Auto

       Supply, which was a rebuilding shop or a [] service center for rebuilding motors,

       [] those types of things.” Id. at 75. He indicated he did not purchase a

       corporate name, any covenant not to compete, any goodwill, any patent rights,

       any accounts receivable, or any books and accounts from Chaffins.

[13]   Dittrich was asked the business of D & D NAPA, Inc., and D & D Metal

       Products, Inc., and he replied that each were in the business of selling auto

       parts. When asked the business activity of Chaffins, Dittrich testified that it

       “did engine repairs in their Roger’s Precision Auto in the back” and “had a very

       small parts store up in the front, and his, most of his business was rebuilding

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 8 of 23
       motors.” Id. at 76. Dittrich was asked “[s]o the auto part store in the front, was

       that, is that the Napa North Judson,” and Dittrich testified “Yes. You can’t

       operate a store with $20,000 of inventory” and that “[y]ou wouldn’t have

       customers.” Id. He testified Chaffins was “running an engine rebuilding center

       there” and “had blades and different things to rebuild motors” and that “[t]his

       was just like a little counter in the front of there . . . .” Id. He stated that he

       thought the business was still at that location even though D & D had moved.

       When asked if D & D “had the business name Napa North Judson,” Dittrich

       replied “we answer the phone Napa North Judson.” Id. at 77. When asked the

       reason, Dittrich testified that there are six thousand NAPA dealers, and that

       “what happens is, Napa, when they have a customer that’s not doing well or is

       gonna close, they go out and find somebody to kept [sic] that territory open”

       and “[s]o they came to me said look we have this opportunity in North Judson

       we’d like you to look at.” Id. Dittrich testified D & D was not a franchisee but

       that it bought NAPA parts, that it used the NAPA name, and that it sold only

       auto parts and only NAPA auto parts. When asked if he had another location

       besides the North Judson location, Dittrich testified “[w]e have eleven in

       Illinois and five in Indiana” and that they were all NAPA stores. Id. at 78.

[14]   On cross-examination, when asked if D & D had purchased furniture and

       fixtures from Chaffins, Dittrich testified: “(inaudible) where you purchase the

       racking that the stuff sits on, the counter, the computers. That would be what

       we considered that $17,000 number. The gondulas [sic] in the front of the store

       where you put your oil and your car wash stuff.” Id. at 79. When asked about

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 9 of 23
       the October 15, 2013 letter referencing that $200,000 of assets were purchased,

       he said “[t]hat’s because of the amount of auto parts that we needed to put in

       the store before we opened it.” Id. Dittrich further testified that, at the time he

       looked at the business, there were no employees other than Roger’s wife, the

       company provided applications for any public person to fill out, they

       interviewed and hired Roger’s son and another person, and that D & D was not

       still leasing the building from Chaffins because it moved to a bigger and better

       location.

[15]   When asked if, when he first operated the store on Talmer Avenue, he used the

       same signage as Chaffins, Dittrich indicated it was a NAPA brand logo and

       that he did not change the sign. He said that the website was maintained by

       NAPA Corporate in Atlanta, Georgia, that the website flags any store that uses

       the NAPA name, and that D & D has nothing to do with and does not pay for

       the website. He indicated that D & D did not have a store-specific website,

       NAPA territories are not protected, and that how many NAPA stores are in an

       area depends on the population. When asked what specifically D & D was

       protesting, Dittrich testified “I’m protesting the rate. . . . I mean, for a $37,000

       investment to go through what I’m doing today? No way. I wouldn’t even had

       attempted to do it. I don’t need it. . . . I bought his assets, not his liabilities and

       had I known that this was hanging out there, I would not have moved forward

       with it.” Id. at 84.

[16]   In closing, the DWD’s counsel asked the ALJ to find that D & D was a

       successor employer under Ind. Code § 22-4-10-6 or, in the alternative, that D &

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 10 of 23
       D did at least acquire a distinct and segregable portion of the organization

       under Ind. Code § 22-4-10-6(b). D & D asked the ALJ to overturn the

       determination that was made by the DWD.

[17]   On January 5, 2015, the ALJ issued a Decision of Liability concluding that D &

       D acquired Chaffins’s auto parts retail business only and became a successor

       employer pursuant to Ind. Code § 22-4-10-6(b). The ALJ’s decision provides in

       part:

               The . . . issue involved in this case is whether [D & D] made a
               complete acquisition and became a successor employer to Chaffins. In
               cases of disposition/acquisition, the [DWD] is bound by specific
               statutes, which establish whether a disposition/acquisition results in a
               successorship. In applying those statutes, if the [DWD] determines
               that a successorship transfer exists, a successor employer’s liabilities,
               experience balance, and contribution rate is to be determined based
               upon the applicable statutory provisions. . . .
                                                      *****
               In this case, [D & D] and Chaffins were registered employers with the
               [DWD] at the time of the transfer of assets at issue. Both entities were
               engaged in the automotive parts retail business. [D & D] acquired
               Chaffins’ stock-in-trade, merchandise, inventory, furniture, fixtures,
               and miscellaneous equipment used in Chaffins’ store. [] [D & D] took
               possession of Chaffins’ business location and Chaffins’ NAPA signage
               and phone numbers. [D & D] also hired two employees that once
               worked for Chaffins. [D & D] used all of those things to operate its
               automotive parts retail business. Accordingly, the [ALJ] concludes
               that [D & D] acquired Chaffins’ auto parts retail organization, trade,
               or business.
               Nevertheless, [D & D] provided testimony that Chaffins also had a
               service center in the back of the store. On the Report of Transfer
               Form, Ms. Chaffins marked that the sale was an “other” transaction,
               instead of a sale of the complete organization. Ms. Chaffins also wrote
               an explanation of the “other” designation on the form as a “lease of

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015    Page 11 of 23
               building” and “purchase of retail business.” [] Moreover, the [ALJ]
               notes that Ms. Chaffins reported the effective date of the transfer from
               Chaffins to [D & D] as April 23, 2010 but submitted a Report of
               Inactivation form stating the Chaffins discontinued operations and
               issued its last payroll on September 30, 2011.
               Accordingly, the [ALJ] concludes that [D & D] made a partial
               acquisition of Chaffins’ business. Specifically, [D & D] acquired
               Chaffins’ retail business only. [D & D] did not acquire the service
               center portion of Chaffins’ business. Based on the foregoing
               conclusions, the statutes and rules relating to partial transfers /
               successorships and employer contribution rates, under Indiana
               unemployment law, are applicable to the transfer at issue. The
               [DWD’s] successorship determination is MODIFIED in favor of [D &
               D] and the resulting assessment of contributions, penalty and interest
               must be recalculated.

       Exhibits at 94. D & D now seeks review of the decision of the ALJ.

                                                     Discussion

[18]   The issue is whether the conclusion of the ALJ that D & D is a partial successor

       of Chaffins under Ind. Code § 22-4-10-6 is correct as a matter of law. The

       DWD did not file an appellee’s brief. When an appellee fails to submit a brief,

       we do not undertake the burden of developing its arguments, and we apply a

       less stringent standard of review, that is, we may reverse if the appellant

       establishes prima facie error. Zoller v. Zoller, 858 N.E.2d 124, 126 (Ind. Ct. App.

       2006). This rule was established so that we might be relieved of the burden of

       controverting the arguments advanced in favor of reversal where that burden

       properly rests with the appellee. Wright v. Wright, 782 N.E.2d 363, 366 (Ind. Ct.

       App. 2002). Questions of law are still reviewed de novo. McClure v. Cooper, 893
N.E.2d 337, 339 (Ind. Ct. App. 2008).

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015    Page 12 of 23
[19]   Under Ind. Code § 22-4-32-9, “[a]ny decision of the liability administrative law

       judge shall be conclusive and binding as to all questions of fact.” The decision

       of the liability administrative law judge may be appealed “solely for errors of

       law under the same terms and conditions as govern appeals in ordinary civil

       court.” Franklin Elec. Co. v. Unemployment Ins. Appeals of Ind. Dep’t of Workforce

       Dev., 953 N.E.2d 1066, 1069 (Ind. 2011). The liability administrative law

       judge’s legal conclusions are not entitled to the same deference. Id.

[20]   D & D maintains the ALJ’s determination that it was a successor of Chaffins

       was improper and argues that it did not purchase substantially all of the assets

       of Chaffins and that its experience rating should be recalculated to reflect this

       incorrect determination. D & D contends that the facts in this case follow

       closely those of Indianapolis Concrete, in that it did not acquire any corporate

       name, goodwill, work in progress, patent rights, licenses, trademarks, trade

       names, technical data, or book of accounts from Chaffins, and that in fact D &

       D acquired even less assets than in Indianapolis Concrete because it did not

       acquire any of Chaffins’s customers.

[21]   D & D further contends that the primary business of Chaffins was the auto

       repair shop, that D & D did not and does not provide any auto repair services,

       and that its business is solely the sale of automobile parts. It states that “[t]he

       only asset purchase from Chaffins which benefits this business is the purchase

       of inventory constituting only approximately 20% of the inventory necessary for

       D & D to conduct its business,” that “[a]ll other inventory was purchased from

       other suppliers so that D & D could conduct its business,” and that “[a]s a

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 13 of 23
       primary auto parts store, the assets purchased from Chaffins were utterly

       insufficient to conduct D & D’s chosen business.” Appellee’s Brief at 4. D & D

       argues that, in applying the definition used by the court in Indianapolis Concrete,

       it is not a successor employer.

[22]   Unemployment insurance in Indiana is financed by a tax on Indiana employers.

       Franklin Elec., 953 N.E.2d at 1069. Employer contributions are charged

       proportionally against an employer’s experience account. Id. (citing Ind. Code

       § 22-4-11-1(a)). As a result, the more unemployment claims that are filed

       against an employer, the more that employer must contribute to the

       unemployment fund. Id.

[23]   Each year, the Department of Workforce Development determines the

       contribution rate applicable to each employer, and the contribution is then

       credited to an “experience account” established for each employer by the

       Department. UTLX Mfg., Inc. v. Unemployment Ins. Appeals of Ind. Dep’t of

       Workforce Dev., 906 N.E.2d 889, 892 (Ind. Ct. App. 2009) (citing Ind. Code § 22-

       4-11-2(a), (e)). An employer’s experience account is charged when a qualifying

       employee receives unemployment benefits based upon unemployment with that

       employer. Id. The experience account contribution rate for an employer is

       determined, in part, by the balance in its experience account. Id. Therefore,

       when a company’s employees file more unemployment claims, its contribution

       rate will also increase. Id.

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 14 of 23
[24]   In the event of a sale of a company, the DWD is responsible for determining the

       successorship status of an acquiring employer when either a total or partial

       acquisition occurs between employers. Id. (citing Indianapolis Concrete, 900
N.E.2d at 50). A successor employer assumes the resources and liabilities of

       the experience account of the predecessor employer with respect to that portion

       of the organization, trade or business acquired. Id. The successor employer’s

       contribution rate is then adjusted based upon the new balance in its experience

       account. Id. If an acquiring employer is denied successor employer status, its

       experience account balance does not change after the acquisition and the

       employer’s contribution rate is calculated based upon that unchanged balance.

       Id.

[25]   An “Employer” in Indiana’s unemployment compensation system includes any

       “employing unit” which acquires the organization, trade, or business of another

       employer and any employing unit which “acquires substantially all the assets

       within this state of such an employer used in or in connection with the

       operation of such trade or business,” Ind. Code § 22-4-7-2(a), as well as any

       employing unit which “acquires a distinct and segregable portion of the

       organization, trade, or business within this state of another employing unit . . .

       .” Ind. Code § 22-4-7-2(b).

[26]   Ind. Code § 22-4-10-6 governs successor employers, and subsection (a) of the

       statute applies in part where there is an acquisition of substantially all the assets

       of another employer and provides in part:

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 15 of 23
               when:
                        (1) an employing unit (whether or not an employing unit at the
                        time of the acquisition) becomes an employer under IC 22-4-7-
                        2(a);
                        (2) an employer acquires the organization, trade, or business, or
                        substantially all the assets of another employer; or
                        (3) an employer transfers all or a portion of the employer’s
                        trade or business (including the employer’s workforce) to
                        another employer as described in IC 22-4-11.5-7;
               the successor employer shall, in accordance with the rules prescribed
               by the department, assume the position of the predecessor with respect
               to all the resources and liabilities of the predecessor’s experience
               account.

[27]   Subsection (b) of Ind. Code § 22-4-10-6 applies in part where there is an

       acquisition of a “distinct and segregable portion” of the business of another

       employer and provides in part:

               when:
                        (1) an employing unit (whether or not an employing unit at the
                        time of the acquisition) becomes an employer under IC 22-4-7-
                        2(b); or
                        (2) an employer acquires a distinct and segregable portion of the
                        organization, trade, or business within this state of another
                        employer;
               the successor employer shall assume the position of the predecessor
               employer with respect to the portion of the resources and liabilities of
               the predecessor’s experience account as pertains to the distinct and
               segregable portion of the predecessor’s organization, trade, or business
               acquired by the successor. . . . This portion of the resources and
               liabilities of the disposing employer’s experience account shall be
               transferred in accordance with IC 22-4-11.5.

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015     Page 16 of 23
[28]   Ind. Code §§ 22-4-11.5 relates to assignment of employer contribution rates and

       transfers of employer experience accounts, and Ind. Code § 22-4-11.5-7

       provides in part:

               (a) This section applies to a transfer of a trade or business that meets
               the following requirements:
                        (1) An employer transfers all or a portion of the employer’s
                        trade or business to another employer.
                        (2) At the time of the transfer, the two (2) employers have
                        substantially common ownership, management, or control.
               (b) The successor employer shall assume the experience account
               balance of the predecessor employer for the resources and liabilities of
               the predecessor employer’s experience account that are attributable to
               the transfer.
               (c) The contribution rates of both employers shall be recalculated, and
               the recalculated rate made effective on the effective date of the transfer
               described in subsection (a). . . .

[29]   In Astral Indus., Inc. v. Ind. Emp. Sec. Bd., the court noted that the word

       “substantially” in referring to a predecessor’s assets does not “indicate a

       definite, fixed amount of percentage but is an elastic term which must be

       construed according to the facts of the particular case” and that “a prime

       question in determining whether substantially all of the assets of the

       organization or the trade or business was taken over is: Did the acquisition

       result in a substantial continuation of the same or a like business?” 419 N.E.2d
192, 197 (Ind. Ct. App. 1981) (citation omitted).

[30]   In Ashlin Transp. Servs., Inc. v. Ind. Unemployment Ins. Bd., the court addressed

       the meaning of “distinct and segregable” as used in Ind. Code § 22-4-10-6(b)

       and noted that employees are assets, at least in a practical business sense, and
       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015        Page 17 of 23
       that when a company acquires employees it may acquire a distinct and

       segregable portion of the organization, trade, or business of another employer.

       637 N.E.2d 162, 167 (Ind. Ct. App. 1994).

[31]   In Indianapolis Concrete, the court observed that, in determining whether one

       employer has acquired substantially all of the assets of another under Ind. Code

       § 22-4-10-6(a), courts have considered several factors, including acquisition of

       manufacturing equipment and machinery, office equipment, corporate name,

       inventories, covenants not to compete, possession of premises, goodwill, work

       in progress, patent rights, licenses, trademarks, trade names, technical data, lists

       of customers, sales correspondence, books of accounts, and employees

       transferred. 900 N.E.2d at 51. The court noted that Indianapolis Concrete had

       hired a number of another employer’s former employees, acquired two of the

       other business’s clients, and acquired certain assets of the other business

       including its phone number, two trucks, and other equipment. Id. at 52. The

       court also observed, however, that the owner of Indianapolis Concrete supplied

       his own equipment and leased further equipment as well as ten vehicles, that

       the work of Indianapolis Concrete was more diverse than the other business’s

       work, that the other business had no ongoing projects, and that Indianapolis

       Concrete did not acquire the other business’s premises, office equipment,

       computers, bank accounts, or goodwill. Id. The court concluded that, in light

       of the factors discussed, Indianapolis Concrete did not acquire substantially all

       of the assets of the other company but rather acquired assets from which it built

       a new business. Id.

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 18 of 23
[32]   In UTLX Mfg., Union Tank restructured its business into three units, namely,

       leasing, manufacturing, and repair, and later UTLX became responsible for

       Union Tank’s manufacturing unit. 906 N.E.2d at 893. Union Tank transferred

       its manufacturing assets, including machinery, equipment, rail trackage, real

       estate, and inventory, as well as hundreds of employees, to UTLX. Id. at 890-

       893. The DWD initially determined that UTLX acquired a portion of Union

       Tank’s business but later determined, after tracking UTLX’s wage reports, that

       the transfer between the disposer and the employer had been a total transfer,

       not a partial transfer, and therefore constituted a full successorship. Id. at 891.

       On appeal, UTLX argued there had not been a total transfer instead of a partial

       sale. Id. The court concluded that UTLX had become an employer to a

       distinct and segregable portion of Union Tank and then also went on to hold,

       based on the hundreds of wage records showing that virtually all of Union

       Tank’s employees in its Indiana manufacturing unit were transferred to UTLX

       in addition to machinery, rail trackage, and some buildings and inventory, that

       UTLX had acquired substantially all of its predecessor’s assets. Id. at 893-894.

[33]   In this case, the ALJ concluded that D & D acquired Chaffins’s auto parts retail

       business only and became a successor employer as to that particular portion of

       Chaffins’s business. We thus do not examine whether D & D acquired the

       service center portion of Chaffins’s predecessor business, such as its business of

       repairing engines and rebuilding motors, or the assets attributable to the service

       center aspect of Chaffins’s business.

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 19 of 23
[34]   We turn to whether there was a transfer of a portion or distinct and segregable

       portion of Chaffins’s trade or business, namely, its auto parts sales business, to

       D & D, and in doing so we consider the factors, to the extent they are

       applicable, identified in Indianapolis Concrete and the opinions above. We also

       note that a number of the factors set forth in Indianapolis Concrete are not

       applicable or do not tend to favor a finding that D & D did or did not acquire a

       portion of Chaffins’s business. In particular, the parties did not present

       evidence that Chaffins possessed any patent rights, trademarks, technical data,

       covenants not to compete, or work in progress and thus the fact D & D may not

       have acquired assets in these categories is not significant.

[35]   While there is no indication that D & D acquired from Chaffins any particular

       customers or lists of customers, sales correspondence, or books of accounts, and

       the bill of sale, in referring solely to inventory and furniture, reveals that D & D

       did not acquire any goodwill from Chaffins, the evidence establishes that D &

       D did acquire other assets.

[36]   D & D does not dispute that it acquired the inventories, certain office

       equipment, and shelving of Chaffins related to the auto parts sales business.

       According to the bill of sale, D & D purchased all of Chaffins’s stock-in-trade,

       merchandise, and inventories for $20,798.29 and the furniture, fixtures, and

       miscellaneous equipment used in Chaffins’s store for $17,279. While the

       purchase of all of Chaffins’s NAPA inventory may or may not have been

       adequate to fully stock D & D’s NAPA business, D & D did purchase all of

       Chaffins’s inventory. Further, Dittrich testified that D & D purchased Chaffin’s

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 20 of 23
       store racking, computers, and gondola shelving. Moreover, both Chaffins, in

       the front area of the building on Talmer Avenue, and D & D, after it leased the

       same building, were engaged in the business of selling automotive parts to retail

       customers.7 In its Report of Transfer form filed with the DWD, Chaffins

       indicated that there had been a purchase of its retail business and that it had

       ceased operations.

[37]   With respect to the store’s premises and location, the evidence establishes that

       D & D initially leased the building on Talmer Avenue from the Chaffins family

       and that it used the same signage of a NAPA brand logo as Chaffins. Dittrich

       testified that D & D used the NAPA name and sold only NAPA auto parts.

       While D & D may have relocated its store to a bigger and better location for the

       business than before the move, D & D continued to engage in the business of

       selling NAPA automotive parts to retail customers and both D & D’s initial and

       new locations were NAPA retail stores in North Judson. D & D used the same

       telephone number used by Chaffins. In short, D & D took possession of

       Chaffins’s auto parts inventory, computers, racking, shelving, business location,

       NAPA signage, and phone number.

[38]   The DWD’s wage detail reports indicate that two employees who had worked

       for Chaffins later worked for D & D. Bottoms testified there was a gap in the

       7
         While the evidence does not indicate that D & D leased the same area of the building on Talmer Avenue
       used by Chaffins to sell auto parts, Dittrich testified that Chaffins may still operate its business from the
       location, indicating Chaffins did not vacate the back area of the building or cease its service center business
       with the sale and lease to D & D.

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015                        Page 21 of 23
       employment of the employees but that the DWD still considered the employee

       movement, “especially if it’s a similar business.” Transcript at 25.

[39]   As to the name of the business, while D & D did not acquire Chaffins’s legal

       corporate name, and Dittrich testified that D & D is not a franchisee and

       NAPA does not use territories, the evidence establishes that Chaffins used the

       NAPA name prior to the sale and D & D used the NAPA name after the sale.

       Further, Chaffins’s business was named “Napa North Judson Roger’s Precision

       Auto Supply,” and when answering the phone D & D’s employees identified

       the store as NAPA North Judson. Id. at 34.

[40]   Chappell testified that D & D purchased Chaffins’s assets and hired the

       employees “to operate the same business in the same location under the same

       DBA that the former entity had used.” Id. at 34. She also testified that “the

       business operated seamlessly between” Chaffins and D & D, that the store was

       a Napa store before and after the sale, and that “it never ceased to be a Napa

       location.” Id. at 69. Dittrich testified that NAPA presented the opportunity in

       North Judson to him and that he had five NAPA locations in Indiana and

       eleven in Illinois.

[41]   Based upon the record and the considerations discussed above, we conclude

       that the ALJ did not err in concluding that D & D acquired Chaffins’s NAPA

       retail auto parts sales business and did not acquire the service center portion of

       Chaffins’s business and thus that D & D made a partial acquisition of Chaffins’s

       business.

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 22 of 23
                                                    Conclusion

[42]   For the foregoing reasons, we affirm the decision of the ALJ.

[43]   Affirmed.

       Riley, J., and Altice, J., concur.

       Court of Appeals of Indiana | Opinion 93A02-1501-EX-58 | September 21, 2015   Page 23 of 23