Cleveland v. Internet Specialties West, Inc.

SUMMARY

Kenneth Cleveland and William Bickley sued several defendants in December 2005, asserting claims of breach of contract and fraud, among others, in connection with a $75,000 investment made pursuant to the terms of a February 1995 agreement. Defendants sought summary judgment on statute of limitations grounds, asserting, among other things, that under the discovery rule for accrual of causes of action, the statutes of limitations began to run in 1996 or 1997, because plaintiffs were then on notice of their injury. The trial court agreed, finding all statutes of limitations began to run by mid-1996, at the latest. We conclude the trial court erred in granting summary judgment, as the question whether and when a reasonably prudent person would have suspected his injury and some wrongful cause was for the trier of fact to decide.

FACTUAL AND PROCEDURAL BACKGROUND

From 1993 to October 1995, Kenneth Cleveland was the accountant for Interactive Strategies, Inc. (ISI), a company that provided technical equipment and facilitated services in the adult telephone entertainment industry. ISI’s officers and shareholders were Robert Johnson, J. Edward Hastings and Brian…