Opinion ID: 223597
Heading Depth: 3
Heading Rank: 3

Heading: The Plaintiffs' UCC Claims Are Time-Barred

Text: Since no discovery rule applies, the Plaintiffs waited too long to file their UCC claims. The Plaintiffs allege that Carpenter's Ponzi scheme, including his opening bank accounts and depositing checks, took place between 1998 and 2000. Under the three-year statutes of limitations in §§ 1304.09 and 1303.16(G), the Plaintiffs had until 2003 at the latest to file their UCC claims. Because the Plaintiffs waited until 2005 and 2008, their UCC claims are accordingly time-barred. Even if we were to apply a discovery rule to §§ 1304.09 and 1303.16(G), the Plaintiffs' UCC claims are still time-barred because they knew of the possibility of wrongdoing more than three years before bringing their claims. Under the discovery rule, an action accrues at the time when the plaintiff discovers or, in the exercise of reasonable care, should have discovered the complained of injury. Investors REIT One v. Jacobs, 46 Ohio St.3d 176, 546 N.E.2d 206, 209 (1989). A plaintiff, however, need not have discovered all the relevant facts necessary to file a claim. Flowers v. Walker, 63 Ohio St.3d 546, 589 N.E.2d 1284, 1287 (1992). Rather, under the discovery rule, a statute of limitations begins running once plaintiffs are deemed to be on notice to investigate the facts and circumstances relevant to [their] claim in order to pursue [their] remedies. Id. at 1288. Information sufficient to alert a reasonable person to the possibility of wrongdoing gives rise to this duty to investigate. Au Rustproofing Ctr., Inc. v. Gulf Oil Corp., 755 F.2d 1231, 1237 (6th Cir.1985). Here, the Plaintiffs were on notice of the defendant banks' possible wrongdoing by 2001. Between 1999 and 2001, Carpenter stopped making interest payments to the Plaintiffs from their investments in his sham companies. A reasonable person would have been alerted to the possibility that the drawee banks had debited the Plaintiffs' accounts with checks that were not properly payable because they were made to fraudulent companies. A reasonable person would also have been alerted to the possibility that the depositary banks violated their duty to act with ordinary care and in good faith by maintaining accounts for fraudulent companies. Thus, under a discovery rule, the Plaintiffs would have had until 2004 to bring their UCC claims. Because they waited until 2005 and 2008, §§ 1304.09 and 1303.16(G) would still bar the Plaintiffs' UCC claims, even under a discovery rule.