Mr. Mark Straw, Executive Administrator
Official Opinion 2020-1
Indiana Attorney General Opinion
State of Indiana Office of the Attorney General
January 7, 2020
Mark Straw, Executive Administrator
State Egg Board
University, Creighton Hall of Animal Sciences
Lafayette, Indiana 47907-2041
Regulation of Online “Merchant Service Provider”
to Ind. Code § 4-6-2-5, the Indiana State Egg Board
(hereafter, the “Board”) requested the opinion of
the Office of Attorney General (OAG) as to whether an entity
engaged in the facilitation of the sale of eggs through
online means is subject to regulation by the Board as a
retailer under applicable State law, specifically Ind. Code
§ 16-42-11 et seq. and Title 370 of the Indiana
the Board have the authority to regulate an online
“merchant service provider” that
“facilitates” the sale of eggs?
“merchant service provider” (hereafter,
“Provider”) does not acquire or transfer title to
eggs and, therefore, does not meet the definition of a
retailer under Ind. Code § 16-42-11-1.1(6) and 370
I.A.C. 1-12-1(4). The Board’s statutory and regulatory
provisions were not designed to address
situations such as the one presented here.
Board’s statutory authority; the meaning of sell/sale;
the passage of title; and rules of statutory construction.
State of Indiana, through legislative enactments, vests power
with the Board to, inter alia, “regulate the sale of
and commerce in eggs sold.” The Board discharges its
duty pursuant to Ind. Code § 16-42-11 and Title 370 of
the Indiana Administrative Code (IAC). The Board may adopt
rules necessary for or incident to discharging its duties,
and can formulate definitions and specifications “for
the care and handling of eggs that may be offered for sale at
retail and wholesale.” Ind. Code §
regulate the sale of and commerce in eggs, the Board issues
permits and provides registration to all
Ind. Code § 16-42-11-5(b)(4). A
“retailer” is defined as “any person who
sells eggs for human consumption and not for resale.”
Ind. Code § 16-42-11-1.1(6); 370 I.A.C. 1-12-1(4).
“Person” includes business entities. See Ind.
Code § 16-42-11-1.1(5); 370 I.A.C. 1-12-1(3).
Ind. Code § 16-42-11 et seq. nor Title 370 of the I.A.C.
defines “sell” or “sale.” The common
and legal meaning of “sale” is one and the
same—“the transfer of ownership of and title to
property from one person to another for a
“Sell” is to transfer property
One who completes a sale or engages in the
act of selling is often referred to as a
“seller.” See Uniform Commercial Code (U.C.C.),
§ 2-103(1)(d), defining “seller” as “a
person who sells or contracts to sell goods.” However,
one who sells a good may not always be the
“seller” (e.g., a consignee may sell goods on
behalf of a consignor). A consignment occurs when goods are
delivered to another’s custody for sale or
Under § 9-319 of the U.C.C.,
“consignment” means a transaction, regardless of
its form, in which a person delivers goods to a merchant for
the purpose of sale and:
(A) the merchant:
(i) deals in goods of that kind under a name other than the
name of the person making delivery;
(ii) is not an auctioneer; and
(iii) is not generally known by its creditors to be
substantially engaged in selling the goods of others;
(B) with respect to each delivery, the aggregate value of the
goods is $1,000 or more at the time of delivery;
(C) the goods are not consumer goods immediately before
(D) the transaction does not create a security interest that
secures an obligation.
divesture and passage of title to property, while not
indicative of ownership, is indicative of a
Generally, title passes to the buyer at
the time and place at which the seller completes his
performance with respect to the physical delivery of goods.
Ind. Code § 26-1-2-401(2). However:
Where goods are bought at one place to be consigned and
transported to the purchaser at another place, in the absence
of any arrangement or agreement to the contrary, the general
rule is that delivery by the seller to a common carrier of
such goods, duly consigned to the purchaser, is a delivery to
the purchaser; for the carrier thereby becomes the agent of
the purchaser, and title to the property passes to him at the
time of such delivery. There are exceptions to this general
rule, but, in the absence of facts showing a different
agreement or arrangement, the presumption is that the general
Robbins v. Brazil Syndicate R. & B. Co., 114
N.E. 707, 709 (Ind.Ct.App. 1917).
judicial constructions for statutory interpretation, Ind.
Code § 16-42-11-1.1(6) (and, for that matter, 370 I.A.C.
1-12-1(4)) need not be subject to interpretation should its
words be unambiguous. Peoples State Bank v. Benton Twp.
of Monroe Cnty, 28 N.E.3d 317, 322-23 (Ind.Ct.App.
2015). Rather, the words and phrases will be read in their
plain, ordinary, and usual sense. Id. A statute
should be construed so as to ascertain and give effect to the
intention of the legislature as expressed in the statute. In
so doing, the objects and purposes of the statute in question
must be considered as well as the effect and consequences of
such interpretation. State v. Eichorst, 957 N.E.2d
1010, 1012 (Ind.Ct.App. 2011). Lastly, when interpreting the
words of a single section of a statute, the words must be
construed with due regard for all other sections of the act
and with regard for the legislative intent to carry out the
spirit and purpose of the act itself. It is presumed that the
legislature intended its language to be applied in a logical
manner consistent with the statute’s underlying policy
and goals. Id.
review of the services of the Provider and the role it plays
in the e-commerce of eggs is necessary to accurately analyze
whether the Provider is a retailer as defined by Ind. Code
§ 16-42-11-1.1(6) and 370 I.A.C. 1-12-1(4)
or is actually
some other concept altogether.
Provider is an online marketplace.
Provider, through its website, offers an online marketplace
where farmers and vendors can sell food products, including
eggs. The Provider monitors how products are advertised on
its website, but vendors list the quantity and determine the...