Posted on February 10, 2015
Last Friday, Ohio’s 9th District Court of Appeals released a decision in favor of local homebuilder KNL Custom Homes, Inc. (“KNL”), one which in effect benefits all businesses operating in this State, by reversing a judgment against KNL premised upon a disputed interpretation of the Ohio Consumer Sales Practices Act (“CSPA”). Due to the collaborative efforts of Attorneys from Harpst Ross, Ltd., and Clark D. Rice of Koeth, Rice & Leo Co. L.P.A., Ohio businesses can breathe a little bit easier, knowing that the immense liability to which they are exposed under the CSPA has been reigned in significantly by this milestone decision. Specifically, the Court ruled that the 2 year statute of limitations on individual CSPA claims starts to run from the date the alleged unfair or deceptive act occurred, enforcing limits on the period within which businesses may be exposed to such claims.
The CSPA was originally adopted to protect individual consumers from unfair or deceptive practices by unscrupulous businesses. While the CSPA certainly serves a valuable purpose, like many laws passed under the auspices of consumer protection, it can be abused by litigious individuals to beat down businesses under the threat of the harsh penalties sanctioned by the CSPA. Indeed, the CSPA allows a consumer to seek and recover treble damages (triple the amount of the actual/compensatory damages) and attorney’s fees. With regard to the KNL case, what amounted to very minor claims of damage ballooned to a liability of several hundred thousand dollars solely because of the treble damages and attorney’s fees provisions of the CSPA. The KNL decision helps level the playing field a bit more so that businesses aren’t quite as vulnerable to unfair attacks under the CSPA.
For a more detailed analysis of the KNL decision, as well as the positive impact it will have on Ohio’s business community, check back later this week. Until then, if you have any questions regarding Ohio’s Ohio Consumer Sales Practices Act, or any other aspect of Ohio construction or business law, please contact Todd Harpst or Nick Horrigan, at Harpst Ross, Ltd. – Business Lawyers for the Construction Industry®, at (330) 983-9971 or email@example.com or firstname.lastname@example.org.
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