Ohio attorney John Ferron, and his client/serial plaintiff, Nathaniel Burdge, thought they had discovered a good moneymaking scheme. They found an obscure Ohio consumer protection statute, one which required retailers to stop printing credit card numbers or expiration dates on sales receipts, and they began suing retailers left and right, claiming the law entitled them to $200 in damages (plus, of course, attorneys fees) for every violation of the law. (The law had only been enacted in 2004, so many retailers were not in compliance.)

Fortunately — though not for Ferron or Burdge — Ohio judges had some common sense, and most quickly held that the words of the statute which explicitly stated that to sue, one had to be “a person injured by a violation” actually meant what they said. Since Burdge wasn’t actually injured, they dismissed his lawsuits. That didn’t deter Ferron/Burdge; they kept filing the suits and kept appealing the dismissals. Finally, one appeals court had enough (PDF), and denounced them in ringing language:

Burdge could not demonstrate that an actual injury was not a required element of his claims because R.C. 1345.18 explicitly sets out an injury requirement. Additionally, Burdge and his attorney had been repeatedly advised of this injury requirement by trial courts in opinions decided on their merits prior to March 2, 2006, when the notice of appeal was filed in this case.²¹ The facts as pleaded in the complaint in this and the other cases indicate that Burdge purposely made purchases at stores that were printing his expiration date on his receipt in order to recoup statutory damages totaling at least $12,800. Burdge’s actions are totally inconsistent with any allegation of actual injury; rather, his actions demonstrate that he attempted to reap a profit from this activity.

We are offended by the contrived nature of this frivolous action, which has wasted much time, paper, and other resources to the prejudice of legitimate disputes between parties, especially those involving the consumer-protection laws of Ohio.

They sanctioned Ferron/Burdge $3,000 for filing a frivolous appeal. (But not, it should be noted, for the frivolous lawsuit itself.)

The concurring judge was even more emphatic:

Without question, the nature of this lawsuit is one contrived to “ambush” the defendant under the color of the Ohio Consumer Sales Practices Act, which seeks to protect Ohio’s consumers from injury due to unfair practices by unscrupulous businesses. In this case, Burdge cannot claim that he was injured in any way, lest why would he return to the “offending” retailer multiple times over a short period of time? The only conclusion is that he was building his claim, with an eye toward statutory damages. A truly reasonable consumer would avoid repeated transactions with a retailer believed to be actually violating the law!

What is particularly disturbing about the contrived nature of this frivolous action, as discussed above, is that, unlike the situation in our recent decision of Starks v. Choice Hotels Int’l.²² where a pro se litigant pursued his frivolous claim through the appellate process, an attorney, licensed to practice in this state and sworn as an Officer of the Court, would facilitate this type of exploitive litigation to the detriment of the defendant, the court system, and the practice of law in general.

If only the California courts would be as realistic about serial Americans with Disabilities Act litigation.

But wait, there’s more! That isn’t the extent of Ferron’s folly. His initial attempt at extorting money from retailers via this law actually worked, until he got a little too greedy. Quoting from Russ Bensing’s Briefcase blog on Ohio law:

And it gets even better. The first time Burdge and his lawyer ran the scheme, against a movie theater, the lawyer negotiated a $2,500 settlement. Because he got the check two days late, the lawyer labeled this a breach of the agreement and demanded twice as much. The defendant told him to pound salt, and the trial court threw out the case altogether, which the court of appeals affirmed.

There’s a lesson in there somewhere, I think.

Filed under: Ohio, pro se