Judge Questions Whether Jury Verdict Supports AG’s $470,000 Penalty Request

Pulaski County Judge Cathleen Compton told attorneys in the Capital City Tree Service lawsuit Monday morning that she would have to “sit with” their arguments before she could issue a ruling on penalties in the case.

“I’m troubled by the thought of me speculating on what the jury meant [by the verdict],” Compton said during the hearing, held on Zoom.

In June, a jury rejected 26 of 27 counts against the company and its owner, Charles Shaw, and general manager Matt Shaw. Co-defendant Janet Shaw was dismissed from the case on summary judgment earlier in the trial. The jury found that the state failed to meet its burden of proof on its price gouging, false representations, concealment, false advertising, bait-and-switch and targeting the elderly claims. The jury found the company liable only on one count under the Arkansas Deceptive Trade Practices Act’s catch-all provision prohibiting unconscionable business conduct, and that finding is now posing a problem for the court.

The verdict form required only a yes-or-no answer to the allegations, so there is no record of what conduct the jury found unconscionable or how many counts.

The state’s interpretation of the verdict is that the jury found the company’s business model, including its contracts, pricing structure and collection practices, was unconscionable, despite finding for the defense on all the other counts. The AG’s Office requested the court award $470,000 in civil penalties; $143,045.34 in restitution; a permanent injunction changing how Capital City Tree Service bills customers, collects debts, and discloses contract terms; and an order preventing the company from collecting on unpaid invoices from four named consumers.

The defense argued that the AG’s Office is asking the court to infer that the jury relied on the same factual theories it expressly rejected with the other counts. The state also sought to rely on post-trial consumer affidavits to support its proposed number of violations, including an allegation of double billing that was not presented to the jury.

Defense attorney Greg Taylor also argued that consumers signed contracts explicitly stating they were responsible for payment regardless of insurance coverage and acknowledged they had an opportunity to review the agreements before signing.

Compton asked the state where she should look to find evidence of the conduct the jury found unconscionable. Assistant Attorney General Jordan Nykaza referred Compton to the state’s allegations in its amended complaint.

“How do I make a ruling on these damages issues without being forced into speculation?” Compton asked at the end of the hearing.

She took the arguments under advisement and is expected to issue a written order at a later date.

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