In a decision issued May 2, 2025, the Indiana Court of Appeals reversed a defamation judgment against a homeowner who publicly criticized a heating contractor, finding that her remarks - though unfavorable - were protected opinions, not false factual claims. The ruling highlights important boundaries for contractors, municipalities, and insurers, particularly those involved with surety bonds.
The case began over a boiler installation in 2014, when Judy Lammons called EDCO Environmental Services, Inc., an HVAC contractor in Crown Point, Indiana, to replace her broken boiler. She agreed to have what she understood to be a new, high-efficiency unit installed. EDCO completed the work that day and billed her for a “new hot boiler.” But three years later, when the system failed again, a different technician discovered that the boiler had actually been manufactured in 2003 – 11 years before the installation date.
After repeated service calls and mounting concerns about performance, Lammons began looking into her options. She filed a consumer complaint with the Indiana Attorney General’s Office, alleging that EDCO had misrepresented the boiler’s age. The company responded that the unit, although manufactured in 2003, had never been used and was fully supported by the manufacturer. They offered Lammons a 10-year parts and labor warranty - contingent on EDCO being the sole service provider - but she declined.
When Lammons later attempted to collect against EDCO’s surety bond - a contractor’s bond required by the City of Crown Point - the insurance company told her it couldn’t act unless the city inspected the boiler. However, the city refused to inspect the work because no permit had been pulled at the time of installation. According to the building inspector, a permit was required for upgrades to high-efficiency systems, though the city’s ordinance was vague on the matter. Caught in this procedural catch-22, Lammons had nowhere else to turn.
So she took her concerns to the Crown Point City Council.
At a public meeting, Lammons read a statement urging the city to adopt clear permitting rules and better protect homeowners. In closing, she asked what the city would do “to protect its citizens from unscrupulous licensed contractors.” Her comments, and a written version submitted to the council, were posted on the city’s website.
That single word - “unscrupulous” - became the focus of a defamation lawsuit filed by EDCO in 2020. The company claimed the remark damaged its reputation and caused financial harm. After a two-day bench trial in February 2024, a Lake County judge sided with EDCO, ruling that Lammons’ statement constituted defamation per se - meaning her words were inherently damaging without the need to prove specific losses. The court awarded the contractor $7,000 in damages, plus $31,485.50 in legal fees and $191.01 in court costs.
But the Indiana Court of Appeals reversed that outcome in full.
Writing for the panel, Judge Elizabeth Tavitas made clear that while EDCO may have disliked Lammons’ remarks, her speech was protected under the First Amendment. The court noted that she never directly called EDCO “unscrupulous.” Instead, she referred more generally to a need for regulation of contractors who avoid permitting requirements. Even if she was indirectly referring to her experience with EDCO, the court said, she was expressing her honestly held opinion - not making a provably false factual statement.
Importantly, the court pointed out that EDCO could not identify any specific harm tied to the comments. The company claimed reputational damage and loss of goodwill but admitted it hadn’t received work from the City of Crown Point since 2018 - two years before Lammons spoke at the council meeting. That weakened their case even further.
Although the lawsuit didn't center on an insurance coverage dispute, the surety bond angle is key for professionals in the insurance space. Lammons tried to recover against EDCO’s bond - held as part of the city’s licensing requirements—but was blocked because an inspection couldn't occur without a permit, and a permit hadn't been obtained. The appeals court did not delve into the terms of the bond itself, but the procedural roadblock illustrates how coverage under these instruments can hinge on regulatory compliance.
By reversing the trial court’s judgment, the appellate court cleared Lammons of all liability, including damages, legal fees, and the injunction.
While the case doesn’t involve a major corporation or headline-grabbing dollar amounts, it resonates in the contractor insurance and municipal regulation sectors. It reminds insurers and bond providers that consumer complaints, even pointed ones voiced in public forums, often fall squarely within the boundaries of protected speech - especially when based on personal experience and honest opinion.
For contractors, the decision is a cautionary tale: suing over public criticism can backfire, especially when procedural records - like permits and inspections - are incomplete. And for municipalities and bond underwriters, the case underscores how gaps in permitting policies can leave all parties in limbo when something goes wrong.
