The "Format after paste" option also formats your selected text when you click somewhere inside the selection. To repro:
1. Type some text that's not indented according to your formatting rules. E.g.:
int foo(int a,
int b,
int c);
(If you paste this example, make sure to undo the auto format)
2. Select the text you typed.
3. Click somewhere inside the selection.
Only repros when the VAX option Advanced > Corrections > Format after paste is selected.
Visual Assist X 10.6.1837.0
Visual Studio 2010