Court Opinion

ID: 2725339
Source: CourtListenerOpinion
Date Created: 2014-09-08 20:48:03.436303+00
Date Added: 2024-06-11T15:40:00.878868
License: Public Domain

FOR PUBLICATION                                                     Mar 21 2014, 10:20 am

ATTORNEYS FOR APPELLANT:                      ATTORNEYS FOR APPELLEE:

DANIEL A. EDELMAN                             JENNIFER KALAS
HEATHER KOLBUS                                SCOTT B. COCKRUM
Edelman, Combs, Latturner & Goodwin, L.L.C.   Hinshaw & Culbertson LLP
Chicago, Illinois                             Schererville, Indiana

MICHAEL P. MCILREE
Hobart, Indiana

                             IN THE
                   COURT OF APPEALS OF INDIANA

NATHAN WERTZ,                                 )
                                              )
      Appellant,                              )
                                              )
             vs.                              )      No. 71A03-1305-CC-175
                                              )
ASSET ACCEPTANCE, LLC,                        )
                                              )
      Appellee.                               )

                   APPEAL FROM THE ST. JOSEPH SUPERIOR COURT
                        The Honorable Jenny Pitts Manier, Judge
                            Cause No. 71D05-1208-CC-607

                                    March 21, 2014

                           OPINION – FOR PUBLICATION

NAJAM, Judge
                                  STATEMENT OF THE CASE1

        Nathan Wertz appeals the trial court’s judgment dismissing his counterclaim

against Asset Acceptance, LLC (“Asset”) pursuant to Asset’s Trial Rule 12(B)(6)

motion.2 Wertz raises six issues for our review, but we need only address the following

dispositive issue: whether, under Indiana’s Uniform Consumer Credit Code (“IUCCC”),

Ind. Code §§ 24-4.5-1-101 to -7-414, Asset, an out-of-state business, was required to

obtain an Indiana license to collect on a debt owed by Wertz that Asset had purchased

from the original lending institution. We affirm.

                            FACTS AND PROCEDURAL HISTORY

        On August 9, 2012, Asset, a Delaware limited liability company with its principal

place of business in Michigan, filed its complaint against Wertz. According to Asset’s

complaint, it had purchased a credit card account from “Chase Bank/First USA/Chase”

(“Chase Bank”) on which Wertz had defaulted.3 Appellant’s App. at 13. Asset sought to

recover a principal balance of $6,594.26, together with interest, on that account.

        On October 22, Wertz filed a counterclaim and putative class action against Asset.

According to Wertz’s counterclaim, Asset “has pursued litigation against over 400

persons in Marion County, Indiana[,] alone,” and “‘legal collections’” accounted for

“44.9% of all [of Asset’s] collections.” Id. at 20-21. However, Wertz continued, Asset

        1
            We held oral argument in this case on February 25, 2014.
        2
         This appeal is from a final judgment entered pursuant to Trial Rule 54(B). See Ind. Appellate
Rule 2(H)(2).
        3
          At oral argument, counsel for Asset stated that Asset was not an assignee of the underlying debt
but a purchaser of it. But, upon questioning, counsel clarified that, after Asset had purchased the
underlying debt from Chase Bank, Chase Bank assigned the debt to Asset. For our purposes, we consider
this sequence of events to be consistent with “[t]aking assignments” under Indiana Code Section 24-4.5-
3-502(3)(b).
                                                     2
is not licensed under the IUCCC to take assignments of Indiana debts or to collect on

those debts, and Asset does not otherwise meet the IUCCC’s description of those entities

authorized to “undertake direct collection of payments from debtors arising out of

consumer loans.” Id. at 19. As such, according to Wertz, Asset’s collection efforts

violated both the Indiana Deceptive Consumer Sales Act (“IDCSA”), I.C. §§ 24-5-0.5-0.1

to -12, and the federal Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §§

1692-1692p. With his counterclaim, Wertz filed a motion to dismiss Asset’s complaint

on the ground that Asset lacked standing to obtain the relief it had requested.

        On December 20, Asset filed a motion to dismiss the counterclaim pursuant to

Indiana Trial Rule 12(B)(6).             In particular, Asset argued that dismissal of the

counterclaim was appropriate in that the IUCCC does not apply to it because it is not an

Indiana business and it has no physical location within Indiana. Asset further asserted

that Wertz’s counterclaim failed to plead a claim under the IDCSA and the FDCPA. On

March 18, 2013, the trial court granted Asset’s motion to dismiss and denied Wertz’s

motion to dismiss. In relevant part, the court stated that “Wertz’s counterclaims under

the FDCPA and [IDCSA] are premised on the assumption that Asset needed to have been

licensed either under the IUCCC or the [Indiana Collection Agency Act (“ICAA”).] It

did not . . . .” Id. at 12. Thereafter, the trial court entered judgment on Asset’s motion to

dismiss pursuant to Indiana Trial Rule 54(B).4 This appeal ensued.

        4
          Although Asset notes that this court is without jurisdiction to consider any arguments on appeal
exclusive to Wertz’s motion to dismiss, on which the trial court did not enter judgment pursuant to Trial
Rule 54(B), Asset does not identify to what extent, if any, Wertz’s arguments on appeal are improperly
based only on his motion to dismiss.
                                                    3
                            DISCUSSION AND DECISION

       Wertz asserts that the trial court erred when it granted Asset’s Trial Rule 12(B)(6)

motion to dismiss Wertz’s counterclaim. In particular, Wertz contends that the IUCCC

required Asset, an out-of-state business with no physical situs in Indiana, to obtain an

Indiana license before it could take the assignment from Chase Bank or collect on

Wertz’s underlying debt. This is a question of first impression for Indiana’s courts.

       Our review of a trial court’s grant of a motion to dismiss under Trial Rule

12(B)(6) is de novo and requires no deference to the trial court’s decision. Sims v.

Beamer, 757 N.E.2d 1021, 1024 (Ind. Ct. App. 2001). “A motion to dismiss under Rule

12(B)(6) tests the legal sufficiency of a complaint: that is, whether the allegations in the

complaint establish any set of circumstances under which a plaintiff would be entitled to

relief.” Trail v. Boys & Girls Clubs of NW Ind., 845 N.E.2d 130, 134 (Ind. 2006).

“Thus, while we do not test the sufficiency of the facts alleged with regards to their

adequacy to provide recovery, we do test their sufficiency with regards to whether or not

they have stated some factual scenario in which a legally actionable injury has occurred.”

Id. When reviewing a Trial Rule 12(B)(6) motion to dismiss, we accept the facts alleged

in the complaint as true and view the pleadings in a light most favorable to the

nonmoving party and with every reasonable inference in the nonmoving party’s favor.

Id. We view motions to dismiss under Trial Rule 12(B)(6) “with disfavor because such

motions undermine the policy of deciding causes of action on their merits.” McQueen v.

Fayette Cnty. Sch. Corp., 711 N.E.2d 62, 65 (Ind. Ct. App. 1999), trans. denied.

       This appeal also requires this court to interpret various statutes and consider an

administrative agency’s interpretation of those statutes. As we have explained:
                                             4
       Statutory interpretation is a question of law reserved for the court and is
       reviewed de novo. De novo review allows us to decide an issue without
       affording any deference to the trial court’s decision. When a statute has not
       previously been construed, our interpretation is controlled by the express
       language of the statute and the rules of statutory construction. Our goal in
       statutory construction is to determine, give effect to, and implement the
       intent of the legislature.        When a statute is subject to different
       interpretations, the interpretation of the statute by the administrative agency
       charged with the duty of enforcing the statute is entitled to great weight,
       unless that interpretation is inconsistent with the statute itself. When a
       court is faced with two reasonable interpretations of a statute, one of which
       is supplied by an administrative agency charged with enforcing the statute,
       the court should defer to the agency. When a court determines that an
       administrative agency’s interpretation is reasonable, it should terminate its
       analysis and not address the reasonableness of the other party’s
       interpretation. Terminating the analysis recognizes the general policies of
       acknowledging the expertise of agencies empowered to interpret and
       enforce statutes and increasing public reliance on agency interpretations.

Ind. Dep’t of Envtl. Mgmt. v. Boone Cnty. Res. Recovery Sys., Inc., 803 N.E.2d 267, 273

(Ind. Ct. App. 2004) (emphasis added; quotations, citation, omissions, alterations, and

original emphases removed), trans. denied.

       The licensing requirement of the IUCCC is stated in Indiana Code Section 24-4.5-

3-502 (“Section 3-502”), which states:

       (1) A person that is a:
              (a) depository institution;
              (b) subsidiary that is owned and controlled by a depository
              institution; or
              (c) credit union service organization;
       may engage in the making of consumer loans that are not mortgage
       transactions without obtaining a license under this article.

       (2) A collection agency licensed under IC 25-11-1[, the ICAA,5] may
       engage in:
             (a) taking assignments of consumer loans in Indiana; and

       5
           A license under the ICAA is issued by the Secretary of State, see Ind. Code § 25-11-1-5(a),
rather than the Department of Financial Institutions, which administers the IUCCC, see I.C. § 24-4.5-6-
103.

                                                  5
              (b) undertaking direct collection of payments from or enforcement of
              rights in Indiana against debtors arising from consumer loans;
        without obtaining a license under this article.

        (3) A person that does not qualify under subsection (1) or (2) shall acquire
        and retain a license under this article in order to regularly engage in Indiana
        in the following actions with respect to consumer loans that are not
        mortgage transactions:
               (a) The making of consumer loans.
               (b) Taking assignments of consumer loans.
               (c) Undertaking direct collection of payments from or enforcement
               of rights against debtors arising from consumer loans.

        (4) A separate license under this article is required for each legal entity that
        engages in Indiana in any activity described in subsection (3). However, a
        separate license under this article is not required for each branch of a legal
        entity licensed under this article to perform an activity described in
        subsection (3).

(Emphases added.)

        There is no dispute that Asset does not meet the requirements of subsection (1).

And although Wertz argues that subsection (2) could have applied to Asset,6 there is no

dispute that, regardless of whether Asset is a “collection agency” and regardless of

whether it could have obtained a license under the ICAA, Asset did not obtain that

license and, therefore, it is not a “collection agency licensed under [the ICAA].” See I.C.

§ 24-4.5-3-502(2). Thus, Asset’s taking of the assignment and attempt to collect on the

debt cannot qualify under either the ICAA or Section 3-502(2).

        Accordingly, the question on appeal is whether Asset, a Delaware limited liability

company with its principal place of business in Michigan, “regularly engage[s] in

Indiana” in taking assignments of consumer loans or in the collection of payments from
        6
             In particular, throughout his brief Wertz provides various formulations of the statement that
“the fact that Asset does not need to have a loan license [under subsection (3)] does not mean that it does
not need any license at all under § 3-502.” Appellant’s Br. at 24 (emphasis removed). Moreover, while
these statements might come across as a concession that Asset need not hold a license under subsection
(3), it is clear from the balance of his arguments that Wertz is not conceding this point.
                                                    6
debtors arising from consumer loans.7 See I.C. § 24-4.5-3-502(3). The parties agree that

the phrase “regularly engage in Indiana” is ambiguous and is not defined in the IUCCC.

Accordingly, to aid in our interpretation we turn to the underlying policies of the IUCCC

as well as the relevant administrative agency’s interpretation of the IUCCC. See id.

       Indiana Code Section 24-4.5-1-102 describes the underlying purposes and policies

of the IUCCC and states, in relevant part, as follows:

       (1) This article shall be liberally construed and applied to promote its
       underlying purposes and policies.

       (2) The underlying purposes and policies of this article are:
              (a) to simplify, clarify, and modernize the law governing retail
              installment sales, consumer credit, small loans, and usury;
              (b) to provide rate ceilings to assure an adequate supply of credit to
              consumers;
              (c) to further consumer understanding of the terms of credit
              transactions and to foster competition among suppliers of consumer
              credit so that consumers may obtain credit at reasonable cost;
              (d) to protect consumer buyers, lessees, and borrowers against unfair
              practices by some suppliers of consumer credit, having due regard
              for the interests of legitimate and scrupulous creditors;
              (e) to permit and encourage the development of fair and
              economically sound consumer credit practices;
              (f) to conform the regulation of consumer credit transactions to the
              policies of the Federal Consumer Credit Protection Act and to
              applicable state and federal laws, rules, regulations, policies, and
              guidance; and
              (g) to make uniform the law, including administrative rules among
              the various jurisdictions.

       (3) A reference to a requirement imposed by this article includes reference
       to a related rule or guidance of the department adopted pursuant to this
       article. . . .

A “[c]reditor” under the IUCCC is

       a person:

       7
           There is no dispute that Asset does not regularly engage in the making of consumer loans
pursuant to Section 3-502(3)(a).
                                                7
                  (a) who regularly engages in the extension of consumer credit that is
                  subject to a credit service charge or loan finance charge, as
                  applicable, or is payable by written agreement in more than four (4)
                  installments (not including a down payment); and
                  (b) to whom the obligation is initially payable, either on the face of
                  the note or contract, or by agreement when there is not a note or
                  contract.

I.C. § 24-4.5-1-301.5(11). And, as noted above, the Indiana Department of Financial

Institutions (“DFI”) is the “department” that has been charged with administration of the

IUCCC. See I.C. § 24-4.5-6-103.

        Indiana Code Section 24-4.5-1-201(1) states the jurisdictional reach of the

IUCCC. In relevant part, that statute provides that “this article applies to sales, leases,

and loans made in this state and to modifications, including refinancings, consolidations,

and deferrals, made in this state, of sales, leases, and loans, wherever made.” I.C. § 24-

4.5-1-201(1).8 In 2007, our legislature amended the statute to add subsection (d), which

has been subsequently amended9 and currently reads as follows:

        a sale, lease, or loan transaction occurs in Indiana if a consumer who is a
        resident of Indiana enters into a consumer sale, lease, or loan transaction
        with a creditor or a person acting on behalf of the creditor in another state
        and the creditor or the person acting on behalf of the creditor has advertised
        or solicited sales, leases, or loans in Indiana by any means, including by
        mail, brochure, telephone, print, radio, television, the Internet, or electronic
        means.

        8
             In his brief, Wertz states that Indiana has extended the territorial reach of the IUCCC to allow
for “actions or other proceedings brought in this state to enforce rights arising from . . . consumer
loans, . . . wherever made.” Appellant’s Br. at 17 (quoting I.C. § 24-4.5-1-201(2)) (emphasis removed;
omissions original). But this quote is misleading because it omits language from subsection (2).
Contrary to Wertz’s representation, subsection (2) states that certain remedies and penalties provided in
Chapter 5 of the IUCCC apply to actions brought in this state regardless of where the underlying contract
was made. I.C. § 24-4.5-1-201(2). As such, subsection (2) is inapposite to this appeal.
        9
            The post-2007 amendments are not relevant to this appeal.
                                                     8
I.C. § 24-4.5-1-201(1)(d). In other words, a loan transaction “occurs in Indiana” if an

out-of-state creditor or its agent in any way advertises or solicits business in Indiana and

enters into the transaction with a resident of Indiana.

       The DFI has issued publications interpreting the IUCCC. In particular, according

to a publication effective July 1, 2012, the DFI has announced certain “loan license

requirements” to explain when a license is required under Section 3-502. Appellant’s

App. at 232. As relevant here, that publication states:

       For non-mortgage consumer loans, a loan license is required if a lender is
       regularly engaged in making consumer loans, and regularly engaged for
       non-mortgage credit is more than twenty-five consumer loans in a year.

                                                 ***

              A loan transaction occurs in Indiana if a consumer who is a resident
       of Indiana enters into a loan transaction with a creditor who is based in
       Indiana, or if the creditor is in another state and the creditor has advertised
       or solicited loans in Indiana by any means, including by mail, brochure,
       telephone, print, radio, television, the Internet, or electronic means (See IC
       24-4.5-1-201(d)). Assignees need a loan license if they are based in
       Indiana and take assignment or undertake direct collection of consumer
       loans that were made in Indiana (See IC 24-4.5-3-502 and 6-102).

Id. (emphasis added).10 That publication is consistent with past publications of the DFI.

See, e.g., id. at 233.

       In sum, the IUCCC exists, in part, to protect consumers from unfair collection

practices by requiring certain creditors and other entities to obtain a license before they

may collect debts.        I.C. § 24-4.5-1-102(2).          The IUCCC also demonstrates our

       10
             In rejecting a similar claim to Wertz’s, the United States District Court for the Northern
District of Indiana cited additional documents from the DFI that likewise require out-of-state companies
to have an Indiana location before those companies need to obtain a license under the IUCCC. See
Sheetz v. PYOD LLC, No. 3:12-CV-811-JD-CAN, 2013 WL 5436943, at *6-*7 (N.D. Ind. Sept. 26,
2013). However, those documents are not in the record in this appeal.

                                                   9
legislature’s intent to reach all potential creditors that demonstrate sufficient minimum

contacts with Indiana. I.C. § 24-4.5-1-201. However, for entities that are not depository

institutions, subsidiaries of depository institutions, credit unions, or collection agencies

licensed under the ICAA, the IUCCC expressly requires licensure only if those entities

“regularly engage in Indiana” in either the making of consumer loans, taking assignments

of consumer loans, or undertaking direct collection of payments from or enforcement of

rights against debtors arising from consumer loans. I.C. § 24-4.5-3-502(3). And the

IUCCC expressly incorporates the “guidance” of the DFI as consistent with the IUCCC’s

underlying policies.       See I.C. § 24-4.5-1-102(3).          The DFI, in turn, has interpreted

Section 3-502(3) to apply to the assignee of a nonmortgage consumer loan only when that

entity has a physical situs within Indiana.

        With this statutory framework in mind, we turn to Wertz’s arguments on appeal.

First, Wertz asserts that the DFI’s publications and the rationale underlying those

publications are contrary to the legislative intent and policies underlying the IUCCC.

Second, Wertz argues that the DFI’s publications were not promulgated pursuant to the

Indiana Administrative Rules and Procedures Act and are, therefore, invalid. We address

each argument in turn.11

        Regarding the argument that the DFI’s publications are contrary to our

legislature’s intent, Wertz asserts that our legislature intended for the IUCCC to reach all

        11
           Wertz also asserts that the DFI publications are irrelevant because “most out[-]of[-]state debt
buyers complied with § 3-502 by getting a collection agency license” under the ICAA, Appellant’s Br. at
14, and that the DFI publications “erroneously focus[] on whether Asset needed an IUCCC loan license,
not a collection agency license” under the ICAA, id. at 16 (emphasis removed). But as discussed above
there is no dispute that Asset is not a collection agency licensed under the ICAA. Accordingly, these
arguments are without merit.

                                                   10
entities with sufficient minimum contacts with Indiana and that this reach extends to the

IUCCC’s licensure requirements.12 In support, Wertz asserts that the DFI has mistakenly

relied on comments to the 1968 Uniform Consumer Credit Code instead of relying on the

plain language of the IUCCC as amended in 2007. We cannot agree.

        The Indiana Supreme Court has squarely rejected Wertz’s assertion that the

commentary to a uniform act “represents what Indiana rejected, not what it enacted.” See

Appellant’s Br. at 20. In particular, in Basileh v. Alghusain, 912 N.E.2d 814, 821 (Ind.

2009), our Supreme Court held that “[t]he comments to a uniform act are indicative of the

Legislature’s intent in enacting a statute based on the uniform act.” Wertz makes no

attempt to discuss or distinguish this clear guidance from our Supreme Court. Instead,

for support of his assertion he cites Ira Holtzman, C.P.A. v. Turza, 728 F.3d 682, 688 (7th

Cir. 2013), cert. denied, 82 U.S.L.W. 3409 (Feb. 24, 2014). But at no point in that

opinion does the United States Court of Appeals for the Seventh Circuit discuss Indiana

law.    Instead, the court’s entire analysis is based on regulations of the Federal

Communications Commission and case law of the Supreme Court of the United States.

Wertz’s assertion that the comments to the Uniform Consumer Credit Code are not

indicative of our legislature’s intent in enacting the IUCCC is without merit.

        The United States District Court for the Northern District of Indiana has also

rejected an argument identical to Wertz’s in Scheetz v. PYOD LLC, No. 3:12-CV-811-

JD-CAN, 2013 WL 5436943 (N.D. Ind. Sept. 26, 2013), and Havens v. Portfolio

        12
            Wertz also relies on Indiana Code Section 24-4.5-6-201(1) as support for his position that the
IUCCC applies broadly to entities outside of Indiana. But Wertz’s attempt to connect the language of that
statute to his argument lacks cogency.
                                                   11
Investment Exchange, Inc., ___ F. Supp. 2d ___, 2013 WL 6086158 (N.D. Ind. Aug. 15,

2013).13 Specifically, the Scheetz court stated as follows:

        Section 3-502 is a part of the IUCCC, which was enacted in Indiana based
        on the Uniform Consumer Credit Code, as promulgated in 1968. Indiana
        section 3-502 corresponds to section 3-502 of the 1968 Uniform Code. The
        commentary to Uniform Code section 3-502 states, in part: “Out-of-state
        lenders who make loans through the mail normally will not be subject to
        the licensing requirement if the evidence of debt is received by the lender
        out of this State. An out-of-state lender who opens a loan office in this
        State at which evidence of debt for [consumer] loans is received must be
        licensed.” Unif. Consumer Credit Code (1968) § 3-502 cmt. 2 (citation
        omitted).

                Other sections of the IUCCC contain similar commentary which bars
        the application of the statute to out-of-state businesses. For example,
        section 6-201 of the IUCCC relates to the requirement that certain
        businesses file a notification with the DFI before engaging in certain
        activities in Indiana. One such regulated activity is “[t]aking assignments
        of rights against debtors that arise from sales, leases, or loans by a person
        having an office or a place of business in Indiana.” Ind. Code § 24-4.5-6-
        201(1)(b). The commentary to that section in the Uniform Code states, in
        part: “Assignees of consumer obligations must file notification under
        Section 6.202 only if all of the three following elements are present: (1) the
        assigned obligations arose out of sales, leases or loans made in this State,
        (2) the assignee has an office or place of business in this State, and (3) the
        assignee undertakes direct collection of payments from the debtors or direct
        enforcement of obligations against debtors. An assignee having no office
        13
            Although Sheetz is unpublished, that does not foreclose this court’s consideration of it. While
not-for-publication memorandum decisions of the Indiana Court of Appeals “shall not be regarded as
precedent and shall not be cited to any court” absent certain exceptions, App. R. 65(D), that is not true in
the federal court system, see Fed. R. App. P. 32.1; see also id. cmt. (“a court of appeals may not prohibit a
party from citing an unpublished opinion of a federal court for its persuasive value . . . .”). Indiana
Appellate Rule 65(D) applies only to not-for-publication memorandum decisions of the Indiana Court of
Appeals. See App. R. 65(D).
        We also note that counsel for Wertz was the counsel of record in the Sheetz and Havens decisions
as well as in a third decision of the district court, Niemiec v. NCO Financial Systems, Inc., No. 1:05-CV-
219, 2006 WL 1763643 (N.D. Ind. June 27, 2006). Yet, despite his knowledge of the Sheetz decision,
that decision’s clear relevance to the instant appeal, and Asset’s unambiguous reference to and reliance on
that decision in its brief, Wertz’s counsel neither cites nor discusses the Sheetz decision in either of his
briefs on appeal. Further, Wertz’s counsel’s only mention of the Havens decision is to say that the
Havens court “improperly relied on the 1968 Commentary to the Uniform Consumer Credit Code in
reaching its conclusion.” Appellant’s Br. at 20. As explained in the text of our discussion, we reject this
apparent attempt to distinguish persuasive federal authority. And while the Niemiec decision is relevant
to Wertz’s FDCPA claims, which we need not reach here, as he did with the Sheetz decision Wertz’s
counsel wholly ignores the Niemiec decision.
                                                     12
or place of business within this State is not required to file notification even
though he is engaged in direct collection or direct enforcement of consumer
accounts in this State.” Unif. Consumer Credit Code (1968) § 6-201 cmt.
2.

       The commentary seems to indicate a legislative intent not to apply
the IUCCC to companies physically located outside of Indiana. However,
M[s]. Scheetz raises two arguments against the application of the
commentary in this case. First, she argues that the commentary is a
comment to the Uniform Consumer Credit Code and not the actual
commentary of the Indiana legislature. Second, she argues that the statute
has been subsequently amended and the current version “makes no
reference to an exemption for debt buyers or lenders.”

        Her first argument is foreclosed by the fact that Indiana courts do
consider the commentary to the Uniform Code as indicative of the intent of
the Indiana legislature in enacting the Uniform Code. Basileh, 912 N.E.2d
at 821.

        With respect to her second argument, Ms. Scheetz is correct that
section 3-502 has been amended several times since its original enactment.
The majority of those amendments do not speak to the extraterritorial
application of its licensing provisions. See Ind. Pub. L. 122-1994 § 24
(amending statute to be gender neutral); Ind. Pub. L. 10-2006 § 6, 57-2006
§ 6 (amending statute to engage in cosmetic rewriting). However, one
amendment seems to signify an intent to limit application of the statute as
to out-of-state entities. Specifically, in 2000, the legislature changed the
licensing requirements from applying to any entity that “engage[d] in this
state in the business of” the listed activities, to applying the licensing
requirements to any entity that “regularly engage[d] in this state” in those
activities. Ind. Pub. L. 23-2000 § 7 (emphasis added). The fact that the
legislature increased the required nexus to the state—requiring more
contact with Indiana before a license is required—evidences a legislative
intent consistent with the opinions expressed in the Uniform Code
commentary (rather than inconsistent with that commentary, as Ms. Scheetz
argues).

       Accordingly, the Court predicts that the Indiana Supreme Court
would consider as persuasive the Uniform Code commentary expressing
that section 3-502 did not intend to require an out-of-state company to
obtain a license under the IUCCC.

                                      13
Sheetz, 2013 WL 5436943 at *5-*6 (emphases added; footnote and citations to the record

omitted; alterations original); see also Havens, 2013 WL 6086158 at *2-*4 (reaching the

same conclusions).

       We agree with the district court’s rejection of the argument that the plain language

of the IUCCC extends the licensure requirement to entities not physically located within

Indiana. In addition to the reasons stated by the district court, we add that Wertz’s

reliance on the 2007 amendment to Indiana Code Section 24-4.5-1-201(1) is misplaced

because the jurisdictional reach described in subsection (d) of that statute applies to all

“creditor[s]” that have sufficient minimum contacts in Indiana. But Section 3-502(3),

which is the licensure requirement relevant here, does not require “creditors” to obtain a

license and instead focuses on the actions undertaken by the entity in question. These

actions, in particular that of taking an assignment or collecting on a debt, may or may not

be the actions of a creditor.

       Further, while a creditor is an entity that “regularly engages” in certain practices,

I.C. § 24-4.5-1-301.5(11), that definition differs from the phrase “regularly engage in

Indiana” that is found in Section 3-502. The inclusion of the prepositional phrase and

geographical limitation “in Indiana” demonstrates that our legislature sought to connect

this provision of the IUCCC’s licensure requirement to those entities located “in

Indiana.” That is, given that the entities described in Section 3-502(3) may be more

remotely connected to Indiana than a creditor, our legislature added this phrase to Section

3-502(3) to ensure that those entities would have a physical presence in our jurisdiction.

While other interpretations of this phrase may be reasonable, this interpretation is also

                                            14
reasonable. As this is the interpretation of the DFI, we must accept it. See Boone Cnty.

Res. Recovery Sys., Inc., 803 N.E.2d at 273.

       We also note that, at oral argument, counsel for Wertz asserted that Section 3-

502(3) does not apply here because, according to the DFI publication, Asset needed to

have made twenty-five or fewer consumer loans per year to avoid “regularly engag[ing]

in Indiana.” See Appellant’s App. at 232. According to Wertz, Asset far exceeded this

number, as demonstrated by the more-than-400 complaints Asset is alleged to have filed

in Marion County alone.

       This argument misunderstands the DFI publication. Section 3-502(3) describes

three actions that may subject an entity to licensure: the making of consumer loans, the

taking assignments of consumer loans, or the collection of payments from debtors arising

from consumer loans. I.C. § 24-4.5-3-502(3). The DFI publication tracks that structure,

and the language of the DFI publication that Wertz relies on here states: “a loan license

is required if a lender is regularly engaged in making consumer loans, and regularly

engaged for non-mortgage credit is more than twenty-five consumer loans in a year.”

Appellant’s App. at 232. On its face that language applies only to entities that make

consumer loans. Asset is not such an entity, and the volume of its collection attempts is

insignificant because Asset is not engaged in making consumer loans.

       Finally, we turn to Wertz’s argument that the DFI publication is invalid because it

was not properly promulgated through a formal rulemaking process. The Sheetz court

also considered and rejected this argument, stating as follows:

       The IUCCC grants the DFI broad powers of enforcement, interpretation,
       and oversight with respect to the IUCCC. For example, the definitional
       section of the IUCCC states: “A reference to a requirement imposed by
                                            15
       this article includes reference to a related rule or guidance of the [DFI]
       adopted pursuant to this article.” Ind. Code § 24-4.5-1-102(3). Further, the
       IUCCC grants the DFI the power to “counsel persons and groups on their
       rights and duties” under the IUCCC, “adopt, amend, and repeal rules,
       orders, policies, and forms to carry out the provisions of this article,” and
       exempts from liability any act taken in conformity with a rule, written
       opinion, or written interpretation of the DFI. Ind. Code § 24-4.5-6-
       104(1)(b), (1)(e), (2).

                                          ***

              The DFI interpretations evidence a consistent agency interpretation
       that a physical presence in Indiana is required before an IUCCC license
       must be obtained. . . .

                                          ***

              Finally, [Sheetz] argues that the interpretations should be afforded
       no deference by this Court because the interpretations were not issued
       through a formal rulemaking process. First, Indiana courts do not require
       an agency interpretation to be promulgated as a formal agency rule before
       granting it deference. See Ind. Ass’n of Beverage Retailers, Inc. v. Ind.
       Alcohol and Tobacco Comm’n, 945 N.E.2d 187, [198] (Ind. Ct. App.
       2011)[, trans. denied]. Further, the Court notes that the DFI’s authority
       under the IUCCC is broad and not limited to official rulemaking under the
       Indiana Administrative Agency Act. Specifically, the IUCCC allows the
       DFI to “counsel persons and groups on their rights and duties” under the
       IUCCC and exempts from liability those who act in conformity with that
       guidance. Ind. Code § 24-4.5-6-104(1)(b), (2). The very act of providing
       individual guidance is incompatible with a formal, universally applicable
       rulemaking process. This shows that the legislature’s intent could not have
       been to require all such interpretation to flow through the formal
       requirements of the Indiana Administrative Agency Act.

              Accordingly, the Court predicts that the Indiana Supreme Court
       would afford great deference to the DFI’s interpretation that the IUCCC is
       not intended to require a license for an out-of-state company with no
       physical location in Indiana . . . .

Sheetz, 2013 WL 5436943 at *6-*8 (first alteration original). We agree with the district

court’s analysis on this issue.

                                            16
       In conclusion, we hold that Section 3-502(3) applies to an out-of-state business

with its principal place of business in another state only if that business has a physical

location within Indiana. The DFI’s interpretation of Section 3-502(3) is consistent with

the legislative intent of the IUCCC and is a reasonable interpretation of the phrase

“regularly engage in Indiana.” We must defer to the DFI’s reasonable interpretations of

the IUCCC’s provisions as it is the agency charged with administration of the IUCCC.

We also hold that the DFI was not required to engage in formal rulemaking for its

policies and interpretations to have any force or effect.14

       Accordingly, because Asset is a Delaware limited liability company with its

principal place of business in Michigan, and because Asset does not have a physical situs

within Indiana, the IUCCC’s licensure provision does not apply to it. Because Asset was

not required to obtain a license under the IUCCC, Wertz’s claims under the IDCSA and

the FDCPA cannot stand as alleged. Thus, we affirm the trial court’s dismissal of

Wertz’s counterclaim for failure to state a claim upon which relief can be granted.

       Affirmed.

BAKER, J., and CRONE, J., concur.

       14
           Given our holdings, we need not consider Asset’s various alternative arguments for affirming
the trial court’s judgment, including Asset’s argument that Wertz’s interpretation of the IUCCC is
contrary to the Commerce Clause.
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