Recherche, LLC, and Brooks Davis, individually and on behalf of all others similarly situated
Baldwin County Electric Membership Corporation
from Baldwin Circuit Court (CV-12-900820)
appeal involves the interpretation of the patronage-refund
requirements imposed on electric cooperatives by §
37-6-20, Ala. Code 1975. Recherche, LLC, individually and on
behalf of all other current and former members of Baldwin
County Electric Membership Corporation ("the
members"), filed a class-action complaint in the Baldwin
Circuit Court ("the trial court") against Baldwin
County Electric Membership Corporation ("Baldwin
EMC"), seeking a judgment declaring the rights of the
members to a return of "Patronage Capital" or
"Capital Credits," which the members assert are
"excess revenues" due to be distributed to the
members under § 37-6-20. Brooks Davis subsequently filed
a motion to intervene to represent all former members of
Baldwin EMC. Recherche and Davis asserted that Baldwin
EMC's method of allocating excess revenues to capital
accounts violates § 37-6-20. The trial court dismissed
the action, and Recherche and Davis appealed. We affirm.
and Procedural History
procedural history of the action underlying this appeal is
lengthy; accordingly, we will discuss only those facts
relevant to the issue of Baldwin EMC's distribution of
excess revenues. Recherche, LLC, a domestic limited-liability
company located in Baldwin County and a member of Baldwin
EMC, initiated the underlying class action against Baldwin
EMC in June 2012. In May 2014, Davis filed a motion to
intervene, which the trial court initially denied. On
September 21, 2015, after Davis had appealed that
determination, this Court vacated the trial court's order
denying intervention and ordered the trial court to allow
Davis to intervene. (Case no. 1140057.) Thereafter, Davis
filed a class-action complaint in intervention. Baldwin EMC
amended its answer numerous times and filed multiple
dispositive motions that were denied throughout the course of
the underlying proceedings.
3, 2018, Recherche and Davis filed a joint amended complaint
to which they attached the Baldwin EMC bylaws. On June 7,
2018, Baldwin EMC filed a motion to dismiss and a supporting
brief in which it argued that its method of allocating
capital credits to members' capital accounts as provided
in its bylaws complied with § 37-6-20 and that the
following federal precedent supported the dismissal of the
class action: Davis v. Central Alabama Electric
Cooperative, No. 15-0131-WS-C, Sept. 8, 2015 (S.D. Ala.
2015)(not selected for publication in F.Supp.), Caver v.
Central Alabama Electric Cooperative, No.
15-0129-WS-C, Sept. 8, 2015 (S.D. Ala. 2015)(not selected for
publication in F.Supp.)("Caver
I"), and Caver v. Central Alabama Electric
Cooperative, 845 F.3d 1135, 1141 (11th Cir.
2017)("Caver II"). Baldwin EMC attached to
its motion the Baldwin EMC bylaws and copies of the opinions
issued in Davis, Caver I, and Caver
II. On July 16, 2018, Recherche and Davis filed a
response in opposition to Baldwin EMC's motion. On July
24, 2018, the trial court denied Baldwin EMC's motion to
30, 2018, however, the trial court entered the following
order withdrawing its July 24, 2018, order and granting
Baldwin EMC's motion to dismiss:
"The MOTION TO DISMISS [RECHERCHE AND DAVIS'S]
AMENDED COMPLAINT PURSUANT TO RULE 12(B)[, Ala. R. Civ. P.,
] is hereby GRANTED based solely upon the Caver
arguments asserted by [Baldwin EMC]. The opinion of the
Eleventh Circuit Court of Appeals in Caver v. Central
Alabama Electric Cooperative, 845 F.3d 1135 (11th Cir.
2017), upheld Rule 12 orders of dismissal by the United
States District Court for the Southern District of Alabama.
While that opinion is not binding precedent on this Court,
it is the only appellate opinion to interpret the subject
statute. The Court is convinced that, given the number of
identical cases pending in Alabama state courts, the
Alabama Supreme Court's consideration of the statute is
necessary to ultimately resolve the issue of how electric
cooperatives must distribute excess revenues under the
controlling statute. [Recherche and Davis's] appeal of
this Order granting [Baldwin EMC's] motion will allow
for just that. Accordingly, [RECHERCHE AND DAVIS'S]
AMENDED COMPLAINT is hereby DISMISSED WITH PREJUDICE."
(Capitalization in original.) Recherche and Davis timely
filed a notice of appeal to this Court.
trial court stated that it based its decision "solely
upon" Baldwin EMC's reliance on Caver v. Central
Alabama Electric Cooperative, 845 F.3d 1135
(11th Cir. 2017). Although Baldwin EMC attached its bylaws to
its motion to dismiss, Recherche and Davis had already
submitted a copy of those bylaws as an exhibit to their
amended complaint. "Exhibits attached to a pleading
become part of the pleading." Ex parte
Price, 244 So.3d 949, 955 (Ala. 2017) (citing Rule
10(c), Ala. R. Civ. P.). Accordingly, because the trial court
did not consider evidentiary matters outside the pleadings so
as to convert Baldwin EMC's motion to dismiss to a motion
for a summary judgment, we apply the standard of review
applicable to Rule 12(b)(6), Ala. R. Civ. P., motions.
"'The appropriate standard of review of a trial
court's [ruling on] of a motion to dismiss is whether
"when the allegations of the complaint are viewed most
strongly in the pleader's favor, it appears that the
pleader could prove any set of circumstances that would
entitle [the pleader] to relief." Nance v.
Matthews, 622 So.2d 297, 299 (Ala. 1993); Raley v.
Citibanc of Alabama/Andalusia, 474 So.2d 640, 641 (Ala.
"Lyons v. River Road Constr., Inc., 858 So.2d
257, 260 (Ala. 2003)."
Liberty Nat'l Life Ins. Co. v. University of Alabama
Servs. Found., P.C., 881 So.2d 1013,