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Clarkwestern Dietrich Building Systems, LLC v. Certified Steel Stud Association Inc.

Court of Appeals of Ohio, Twelfth District, Butler

May 8, 2017

CERTIFIED STEEL STUD ASSOCIATION, INC., et al, Defendants-Appellants.


          Frost Brown Todd LLC, Matthew C. Blickensderfer, Stephen R. Hernick, and Cohen & Grigsby, P.C., Anthony Cillo, Barbara Scheib, Fridrikh V. Shrayber, for plaintiff-appellee

          Faruki Ireland & Cox PLL, D. Jeffrey Ireland, Stephen A. Weigand, Jason W. Palmer, for defendant-appellant, Certified Steel Stud Association, Inc.


          PIPER, J.

         {¶ 1} Defendant-appellant, Certified Steel Stud Association, Inc., ("the Association") appeals a decision of the Butler County Court of Common Pleas denying its motion for summary judgment and denying its request for judgment notwithstanding a verdict, which was rendered in favor of plaintiff-appellee, Clarkwestern Dietrich Building Systems LLC, DBA ClarkDietrich.

         {¶ 2} The Association was formed in 2012 by manufacturers in the business of nonstructural steel framing. These products provide framing for nonstructural walls, those that do not support the weight of the building, and must comply with the standards set forth by the International Building Code ("IBC"). One such compliance standard requires builders to use noncombustible products in multi-story applications. To make the steel products noncombustible and to prevent corrosion, manufacturers use a method of coating the steel in a zinc-based coating called G40.

         {¶ 3} ClarkDietrich, which is headquartered in West Chester, Ohio, is in the business of selling steel framing products, accessories, and related services, and also manufactures coatings. ClarkDietrich began producing an "equivalent" coating to G40, called EQ or G40EQ. ClarkDietrich's development and use of G40EQ allowed it to manufacture its products at a lower cost, and some competitors reduced prices on the traditional G40-coated products to compete with ClarkDietrich's new G40EQ product. The G40EQ coating is not listed in the IBC's table of coatings.

         {¶ 4} The Association released a publication entitled "CSSA Opinion: EQ Coatings Are Not Recognized By The Code, " which included a byline of "Substituting G40e Presents Potential Liability for Contractors On Jobs."[1] Within this publication, the Association made statements that (1) ClarkDietrich's G40EQ product did not comply with IBC standards, (2) the only acceptable coatings are those listed in the IBC tables, (3) ClarkDietrich is in the habit of substituting its products on projects that specify use of G40 coatings without informing the customer, (4) most project specifications require the use of G40 coatings, (5) contractors who use G40EQ are unknowingly subjecting themselves to liability, (6) the G40EQ coating is "paint, " (7) the G40EQ-coated products are inferior to G40-coated products, (8) testing of G40EQ products is less rigorous than for G40 products, and (9) G40EQ products cannot withstand intensive corrosive environments, such as buildings along the coastline.

         {¶ 5} This publication was disseminated by the Association to 9, 560 customers and others involved in the nonstructural steel framing industry. After the publication was distributed, ClarkDietrich lost projects and millions of dollars in revenue.

         {¶ 6} ClarkDietrich sued the Association, as well as later-dismissed defendants, for violation of the Ohio Deceptive Trade Practices Act and unfair competition, defamation, disparagement, and civil conspiracy. The parties moved for summary judgment, and the Association argued that its publication was an opinion protected under the First Amendment, rather than actionable factual statements. The trial court denied the Association's motion for summary judgment on most issues, except for a limited judgment that the Association's statement that ClarkDietrich's products were "inferior" was an unactionable opinion.

         {¶ 7} The trial court also granted summary judgment in favor the Association in a separate action filed by ClarkDietrich in which it alleged that the Association engaged in activities that violated the Valentine Act, Ohio's anti-trust statute. ClarkDietrich appealed that decision to this court, and we affirmed. Clarkwestern Dietrich Bldg. Sys., LLC v. Certified Steel Stud Assn., 12th Dist. Butler No. CA2016-05-098, 2017-Ohio-1091.

         {¶ 8} The remaining matters proceeded to an extensive trial that spanned nine weeks, after which the jury found in favor of ClarkDietrich, and awarded it $49 million, $43 million of which was apportioned to the Association. The trial court entered judgment based on the jury's verdict, and the Association filed a motion for judgment notwithstanding the verdict, or in the alternative, a motion for a new trial. The trial court denied the motion. The Association now appeals the trial court's decisions, raising the following assignments of error.

         {¶ 9} Assignment of Error No. 1:


         {¶ 11} The Association argues in its first assignment of error that the trial court erred by not granting its motion for summary judgment because the ...

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