Opinion ID: 2330622
Heading Depth: 1
Heading Rank: 15

Heading: Statute of Limitations on Full Consideration and Treble Damages Claims

Text: For persons injured or damaged by price-fixing prohibited under K.S.A. 50-101 and K.S.A. 50-112, recovery of damages sustained, full consideration damages, and treble damages are permitted. See K.S.A. 50-108 (applying to K.S.A. 50-101; such damages sustained); K.S.A. 50-115 (applying to K.S.A. 50-112; full consideration or sum paid); K.S.A. 50-161(b) (applying to all of KRTA; treble the damages sustained, any damages suffered); see also K.S.A. 50-147 (The rights and remedies given by this act shall be construed as cumulative of all other laws in force in this state, and shall not affect, change or repeal any other remedies or rights now existing in this state for the enforcement, payment or collection of fines, penalties and forfeitures.). The parties disagree on the applicable statute of limitations and the attendant downward pressure it may exert on any eventual full consideration or treble damages award. We now address the merits of this disagreement. O'Brien argues in favor of application of the 3-year statute of limitations in K.S.A. 60-512(2). It provides that [a]n action upon a liability created by a statute other than a penalty or forfeiture must be brought in 3 years. O'Brien argues that both the full consideration and the treble damages provisions are civil remedies, not penalties, designed to encourage consumers to exercise their rights under the KRTA. Brighton advocates for application of the 1-year statute of limitations in K.S.A. 60-514(c), which governs [a]n action upon statutory penalty or forfeiture. Brighton argues that both the full consideration and treble damages provisions are statutory penalties because they award more than actual damages and are cumulative with actual damages. We also note as an initial matter that amicus Quin Jackson, in addition to supporting O'Brien's argument for application of the 3-year statute of limitations, states that the discovery rule of K.S.A. 60-510 applies and that fraudulent concealment and other tolling issues may be raised as well. Neither of the parties has ever made an issue of either the discovery rule or any tolling doctrine, and we therefore do not address their merit or lack of merit. See State ex rel. Six v. Kansas Lottery, 286 Kan. 557, 561, 186 P.3d 183 (2008) (court will not address arguments raised only by nonparty amici curiae ). District Judge Woolley split the baby. He ruled that the full consideration claim under K.S.A. 50-115 was not a claim for a penalty and was, therefore, subject to the 3-year statute of limitations under K.S.A. 60-512(2). He also ruled that the treble damages claim under K.S.A. 50-161 was a claim for a penalty and was, therefore, governed by the 1-year statute of limitations under K.S.A. 60-514(c). The KRTA explicitly established a cause of action for individuals to sue and recover general damages as well as specific types of damages. See K.S.A. 50-102; K.S.A. 50-108; K.S.A. 50-115; K.S.A. 50-161. It thus creates not only a new procedure for relief, but also new substantive rights. See Wright v. Kansas Water Office, 255 Kan. 990, 997, 881 P.2d 567 (1994); see also Four B Corp. v. Daicel Chemical Industries, Ltd., 253 F.Supp.2d 1147, 1155-56 (D.Kan.2003) (concluding plaintiff's antitrust claims under Kansas law arise out of antitrust statute). In addition, we note that the remedies for persons under the KRTA are separate and distinct from the civil penalties the attorney general is empowered to seek. See K.S.A. 50-103(a)(5); see also K.S.A. 50-160(a) (The commission of any act or practice declared to be a violation of the Kansas restraint of trade act shall render the violator liable to the state for the payment of a civil penalty in a sum set by the court of not less than $100 nor more than $5,000 for each day such violation shall have occurred.); K.S.A. 50-160(b) (Any person who willfully violates the terms of any court order issued pursuant to the Kansas restraint of trade act shall forfeit and pay a civil penalty of not more than $10,000 per violation, in addition to other penalties that may be imposed by the court.... [T]he district court issuing an order shall retain jurisdiction, and in such cases, the attorney general may petition for recovery of civil penalties.). In the words of K.S.A. 60-512(2), an action based on the KRTA is upon a liability created by statute. See Alexander v. Certified Master Builders Corp., 268 Kan. 812, 821, 1 P.3d 899 (2000) (quoting Wright, 255 Kan. at 997, 881 P.2d 567) (liability `created by statute' when `liability for resultant damages would not arise but for the statute'). Likewise, an action based on the KRTA qualifies for the one-word description of K.S.A. 60-514(c): It is statutory. The rest of the relevant language from the two statutes of limitation requires construction. See Brennan v. Kansas Insurance Guaranty Ass'n, 293 Kan. 446, 450, 264 P.3d 102 (2011) (when legislative intent not clear from statutory language court moves to applying canons of construction or legislative history). Although an action seeking a penalty or forfeiture is plainly excluded by K.S.A. 60-512(2) and plainly included by K.S.A. 60-514(c), penalty or forfeiture is not clearly defined. And we have not previously construed penalty or forfeiture as applied to either full consideration damages or treble damages under the KRTA. In the only one of our cases in which the KRTA statute of limitations was in issue, we did not decide the question because the plaintiff's action would have been barred by either limitations provision under consideration. McCue v. Franklin, 156 Kan. 1, 131 P.2d 704 (1942). Judge Carlos Murguia of the federal District of Kansas did reach the issue of the statute of limitations applicable to the KRTA treble damages remedy in Four B Corp., 253 F.Supp.2d at 1155-56, deciding the 3-year statute of limitations in K.S.A. 60-512(2) applied. Judge Murguia cited this court's decision in Alexander, 268 Kan. at 820, 1 P.3d 899, in support of the proposition that [a] claim which arises from a statute does not automatically constitute a `penalty' or `forfeiture' so as to trigger a one-year statute of limitations period, even if a plaintiff is entitled to recover more than his actual damages. Four B Corp., 253 F.Supp.2d at 1154-55. The question of which statute of limitations should apply to KRTA full consideration damages was not before the court in Four B Corp. In an action brought under the Kansas Consumer Protection Act (KCPA), we stated that in many instances where a statute gives accumulative damages to the party grieved, it is not a penal action. Alexander, 268 Kan. at 824, 1 P.3d 899 (citing Huntington v. Attrill, 146 U.S. 657, 667-69, 13 S.Ct. 224, 36 L.Ed. 1123 [1892]). We observed that under the KCPA a consumer had the option to seek either damages or a civil penalty, not both. 268 Kan. at 823, 1 P.3d 899. But we said that the key question was whether a statutory provision was more remedial or punitive in nature. 268 Kan. at 823, 1 P.3d 899. In Alexander, we examined the KCPA statutory scheme and concluded that the KCPA provides a private remedy to consumers in the hope that they will enforce the KCPA as `private attorneys general,' and that consumer suits allowed individuals to gain reimbursement for the private wrong done. 268 Kan. at 822, 824, 1 P.3d 899. We ultimately determined that both an action seeking a civil penalty and one seeking actual damages should be subject to the 3-year statute of limitations because treating the two differently would frustrate the intent of the statute to create an effective remedy for Kansas consumers. 268 Kan. at 823-24, 1 P.3d 899. We said that a 1-year statute of limitations would be appropriate if the legislature had provided for a separate penalty in addition to a damage recovery. 268 Kan. at 824, 1 P.3d 899. As Brighton has noted, both the full consideration damages and treble damages recoverable under the KRTA would exceed actual damages, and it makes sense to subject both provisions to the same statute of limitations analysis. See 268 Kan. at 824, 1 P.3d 899 (under KCPA, applying two different statutes of limitation would force the consumer to file within 1 year, or find his or her options for recovery reduced to merely actual damages). But, otherwise, we regard O'Brien's statute of limitations argument as generally more consistent with our reasoning in Alexander. The 3-year statute of limitations in K.S.A. 60-512(2) gives a greater incentive to consumers to exercise their statutory rights by bringing private actions under the KRTA. Like the KCPA, the KRTA enables individuals to gain reimbursement for the private wrong done. See 268 Kan. at 824, 1 P.3d 899. Also like the KCPA, the KRTA's provisions allowing private suits permit consumers to act as `private attorneys general' to enforce the provisions of the statute and prevent further wrongdoing. See 268 Kan. at 822, 1 P.3d 899. We also are persuaded that both full consideration damages and treble damages under the KRTA are more remedial in nature than punitive. See 268 Kan. at 823, 1 P.3d 899. They are chiefly, if handsomely, designed to compensate an individual who has been injured by a trade restraint, while the Attorney General is explicitly empowered to seek civil penalties to punish a violation on behalf of the rest of the citizens of the state. K.S.A. 50-103(a)(5); K.S.A. 50-160. We therefore hold that neither O'Brien's claim for full consideration damages nor her claim for treble damages qualifies as an action for a statutory penalty or forfeiture. They are both subject to the 3-year statute of limitations under K.S.A. 60-512(2). This holding compels us to affirm the district judge's partial summary judgment ruling on the question of full consideration damages and to reverse his summary judgment ruling on the question of treble damages.