The former owner of a Brown County hotel which received international attention for its online review policy is asking the Indiana Attorney General to dismiss the case.
Local attorney and former Abbey Inn owner Andy Szakaly filed the motion yesterday in Brown Circuit Court.
He says that the Attorney General doesn’t have the authority to request relief from the court for several reasons, and alleges that the state is restricting the inn’s own right to free speech by asking for court action.
“The complaint filed in this matter has no basis in Indiana law; attempts to restrict the ability of the defendant to contract with its guests with regard to conditions of their business relationship; and is based on a single witness’s false statements,” Szakaly wrote.
Indiana Attorney General Curtis Hill had asked for injunctive relief and damages in his case, which was filed Dec. 15. He alleged that the inn violated Indiana’s Deceptive Consumer Sales Act.
Katrina Arthur of Greene County told the Attorney General’s office that she arrived at the inn in March 2016 to find the room unkempt, with water pressure and air conditioner problems and smelling like sewage, and could not find a staff person to tell. She said there also was no staff person at the front desk when she checked out the next day.
Arthur said she later received an email from the hotel asking her to post a review, and she did.
She told the Attorney General’s office that she took the post down upon receiving a threat of legal action from Szakaly, and that her credit card was charged an extra $350 in April.
The Indiana Attorney General’s office alleged that the Abbey Inn’s policy restricting negative online reviews was “unfair, abusive, and deceptive.”
Hill wrote that the inn’s policy “not only attempted to limit negative online reviews, thus improperly shielding the defendant from the consequences of providing consumers with a negative experience or unsatisfactory consumer service during their stay, but would also prohibit a consumer from filing a consumer complaint with the Attorney General or Better Business Bureau, filing a lawsuit, or even a police report, as all could be considered a ‘disparagement in a public manner.’”
The inn no longer has that policy in place, said Szakaly, the sole shareholder of Abbey Management Inc., which operated the inn in 2016 when this guest’s complaint arose.
In his motion to dismiss, Szakaly says that since Arthur signed an acknowledgement and agreement to the inn’s policies, it was not a “deceptive act”; it was a “contractual agreement.”
Szakaly also alleges that no Indiana law defines the term “non-disparagement clause,” and no law says that using such a clause is a “deceptive consumer act.”
“As there is no such statute, there can be no ‘potential violation’ entitling the Attorney General to request any relief from this court,” the motion continues.
Szakaly writes that the Attorney General could address a non-disparagement clause as a “deceptive act” using the federal Consumer Review Act of 2016; however, that did not take effect until March 2017, he said.
Szakaly also argues that the Attorney General’s lawsuit violates the inn management’s right to free speech by restricting its freedom to enter into a contract. “Indiana courts recognize the freedom of parties to enter into contracts and, indeed, presume that contracts represent that freely bargained agreement of the parties,” he wrote.
Szakaly also argues that Arthur should not benefit from her complaint because she has “unclean hands.” He cites five small claims cases against her in Monroe Circuit Court filed between 2006 and February 2017, in which she was ordered to pay a total of $4,596.52 to five different businesses.
“Katrina Arthur, the consumer ‘victim’ in this case, has trouble telling the truth and paying her bills,” Szakaly wrote.
His motion says Arthur told the Attorney General under oath that she was not aware of the policy regarding online criticism, but when she booked her room online, she agreed that she had read and accepted the policy.
A paper that Szakaly attached to the motion shows the page Arthur signed, which points out certain policies such as no smoking in rooms and no pets. It did not specifically highlight the $350 charge for posting negative reviews online, but refers the customer to a website to read the inn’s complete policy.
The page Arthur signed also says that guests should text a cellphone about any problems found in the room before 10 p.m. “Only after leaving the inn without making any complaints did she demand a refund and then posted the damaging, false, on-line (sic) review,” Szakaly’s motion says.
“Ms. Arthur, and others like her, cost all honest consumers money by forcing small businesses to raise their prices for rooms and services as a result of similar actions by a few ‘bad apples.'”
He said the lawsuit and Arthur’s “inaccuracies” have led to death threats against the new management and “severely damaged” the small business.
Arthur did not immediately respond to an emailed request for comment.