Indiana BMV Repays $30 Million to 4.5 Million Drivers Overcharged on License Fees

For six years, every Indiana driver under 75 who renewed or obtained a license paid more than state law allowed. The Indiana Bureau of Motor Vehicles had been collecting fees of $21 for a six-year license, $19.50 for a five-year license, and $18 for a four-year license. Indiana statute capped those fees at $15, $13.50, and $14, respectively. The overcharges were built into the agency's billing system and applied automatically to every transaction in those categories.

The named plaintiff, Tammy Raab, paid $21 for her license on February 16, 2010. Attorneys at Cohen & Malad filed suit on her behalf on March 7, 2013, in Marion County Superior Court, case number 49D06-1303-PL-8769, naming BMV Commissioner R. Scott Waddell and the bureau as defendants. The complaint alleged systematic overcharging since at least 2007 and sought restitution for all affected Indiana residents.

The lawsuit drew immediate public attention. Governor Mike Pence ordered an independent review of more than 300 BMV fee categories shortly after the suit was filed, and the agency reduced its operator's license fees by as much as 19 percent in June 2013 while the case was pending. The review confirmed the overcharges that Cohen & Malad had identified.

Irwin Levin led the class litigation for the firm. On November 12, 2013, Judge Heather Welch of Marion Superior Court approved a $30 million settlement covering approximately 4.5 million Indiana drivers who had paid for a license between March 2007 and June 2013. Individual refunds ranged from $3.50 to $15 depending on the license type purchased. Class members received their refunds automatically as a credit applied to their next BMV transaction; those who preferred a check could request one by mail.

The court approved $6.3 million in attorney fees for Cohen & Malad, representing 21 percent of the settlement fund. The recovery covered only operator's license overcharges. Discovery during and after the 2013 case exposed more than 100 additional fee categories where the BMV had overcharged customers, which led to a second class action and a separate $62 million settlement in 2017.