Aspyn, LLC, D/B/A Econo Lodge of Erlanger, Kentucky v. Margaret Peroulas, as Administrator Ad Litem for a Limited Purpose of the Estate of Alex Chronis

• Court: Court of Appeals of Kentucky
• Decided: November 21, 2025
• Docket: 2024-CA-1221
• Status: Unpublished

Opinion

RENDERED: NOVEMBER 21, 2025; 10:00 A.M. NOT TO BE PUBLISHED

Commonwealth of Kentucky Court of Appeals NO. 2024-CA-1221-MR

ASPYN, LLC, D/B/A ECONO LODGE OF ERLANGER, KENTUCKY AND SANJAY PATEL APPELLANTS

APPEAL FROM KENTON CIRCUIT COURT v. HONORABLE PATRICIA M. SUMME, JUDGE ACTION NO. 22-CI-01491

MARGARET PEROULAS, AS ADMINISTRATOR AD LITEM FOR A LIMITED PURPOSE OF THE ESTATE OF ALEX CHRONIS APPELLEE

OPINION AFFIRMING

** ** ** ** **

BEFORE: EASTON, A. JONES, AND LAMBERT, JUDGES.

JONES, A., JUDGE: This appeal arises from a judgment entered by the Kenton

Circuit Court following a jury verdict in favor of Appellee, Margaret Peroulas, as

Administrator ad litem for a limited purpose of the Estate of Alex Chronis, in a premises-liability and wrongful-death action against Appellants, Aspyn, LLC d/b/a

Econo Lodge of Erlanger, Kentucky, and Sanjay Patel, its member-manager.

The case stems from an incident in which seventy-six-year-old Alex

Chronis sustained fatal third-degree burns after being scalded by excessively hot

water while showering in his room at the Econo Lodge. The jury found Appellants

negligent and awarded the Estate $1,271,486.60 in past medical expenses,

$250,000 for pain and suffering, $16,058.73 for funeral expenses, and $500,000 in

punitive damages, for a total award of $2,037,545.33. Following trial, Appellants

moved for a judgment notwithstanding the verdict (“JNOV”) and for a reduction of

damages. They argued that (1) the evidence was insufficient as a matter of law to

support a punitive-damages instruction or award; and (2) the medical-expense

award should be reduced to exclude amounts written off by healthcare providers.

The circuit court denied both motions.

On appeal, Appellants renew those arguments. For the reasons set

forth below, we affirm the judgment of the Kenton Circuit Court in all respects.

I. BACKGROUND

On November 18, 2021, Chronis checked into the Econo Lodge in

Erlanger, Kentucky, owned and operated by Aspyn, LLC and managed by Sanjay

Patel. Chronis, a traveling food vendor from Tennessee, was en route to a

Christmas festival in Ohio, where he had worked in prior years. He shared Room

-2- 112 with his nephew, Nick Chronis, and a coworker, James Stone. The adjoining

rooms in that wing of the hotel—Rooms 112 through 115—were serviced by a

single commercial water heater installed in 2019 by Joe Rademacher of Joe’s

Plumbing Repair, LLC. The installation was performed without a required permit

and was not subsequently inspected by local authorities.

Early the next morning, November 19, 2021, Chronis entered the

shower in his room. Moments later, his companions heard a thud and his screams.

They found him on the floor, covered in scalding water. Both of Chronis’s legs

were bright red with blisters forming. Although urged to seek medical care, he

instead continued to the festival that day. His nephew treated his burns with over-

the-counter ointment and bandages. Chronis later sought treatment at Miami

Valley Hospital in Ohio, but he left against medical advice before being readmitted

two days later. He remained hospitalized for nearly four months, undergoing

multiple skin grafts and enduring significant complications. On April 6, 2022, he

was transferred to a nursing facility in Knoxville, Tennessee, and later to Fort

Sanders Medical Center, where he died on June 19, 2022, from cardiac arrest

attributed to the sequelae of his burn injuries.

The Estate filed this action in Kenton Circuit Court on October 4,

2022, asserting claims of negligence, premises liability, and wrongful death. It

alleged that Appellants failed to maintain a reasonably safe premises and acted

-3- with wanton disregard for guest safety by failing to inspect, test, or regulate the

hotel’s hot-water system. Appellants denied liability and filed a third-party

complaint against Rademacher and Joe’s Plumbing Repair, alleging negligent

installation of the water heater.

At trial in June 2024, evidence established that the water heater

serving Chronis’s room produced water temperatures between 150 degrees

Fahrenheit and 155 degrees Fahrenheit—substantially higher than the 120 degrees

Fahrenheit safety standard recommended for commercial lodging. Witnesses

testified that the hotel had no written maintenance or testing procedures for water

temperature, that Patel relied on the same plumber for periodic service, and that he

was unaware of the heater’s settings. A former guest had complained about the

water in the bank of rooms at issue several months before the incident, but no

inspection of the heater or testing of those rooms followed. The jury heard

conflicting expert testimony regarding whether the hotel’s omissions constituted

ordinary or gross negligence.

The jury returned a verdict finding Appellants negligent in causing

Chronis’s injuries and death and further finding that their conduct constituted gross

negligence warranting punitive damages. The jury did not attribute any fault to the

third-party defendant, Joe’s Plumbing Repair, LLC, or its owner, Joe Rademacher,

concluding instead that responsibility rested solely with the hotel. It awarded the

-4- Estate $1,271,486.60 in medical expenses, $250,000 for pain and suffering,

$16,058.73 for funeral expenses, and $500,000 in punitive damages, for a total

award of $2,037,545.33. Appellants moved for a JNOV and to reduce the medical-

expense award to exclude $872,260.41 in amounts written off by medical

providers. The circuit court denied both motions.

This appeal followed.

II. ANALYSIS

Appellants raise two principal arguments on appeal. First, they

contend the circuit court erred by submitting punitive damages to the jury because,

in their view, the evidence did not support a finding of gross negligence. Second,

they argue the court erred by refusing to reduce the award of medical expenses to

reflect amounts written off by the medical providers. We address each argument in

turn.

A. Punitive Damages

Appellants erroneously assert that this Court must review the trial

court’s decision regarding punitive damages de novo. The de novo standard

applies where an appellant challenges the language of a particular instruction such

as whether the wording accurately states the law. PBI Bank, Inc. v. Signature

Point Condominiums LLC, 535 S.W.3d 700, 720 (Ky. App. 2016). Here, however,

Appellants do not challenge the form or substance of the instruction. Rather, they

-5- argue that the trial court erred by submitting the issue of punitive damages to the

jury at all. When the question is whether the evidence was sufficient to warrant an

instruction, we review for an abuse of discretion. Kentucky Guardianship

Administrators, LLC v. Baptist Healthcare System, Inc., 635 S.W.3d 14, 20 (Ky.

2021).

Our Supreme Court has explained:

A decision to give or to decline to give a particular jury instruction inherently requires complete familiarity with the factual and evidentiary subtleties of the case that are best understood by the judge overseeing the trial from the bench in the courtroom. Because such decisions are necessarily based upon the evidence presented at the trial, the trial judge’s superior view of that evidence warrants a measure of deference from appellate courts that is reflected in the abuse of discretion standard.

Sargent v. Shaffer, 467 S.W.3d 198, 203 (Ky. 2015), overruled on other grounds

by University Medical Center, Inc. v. Shwab, 628 S.W.3d 112 (Ky. 2021). A trial

court abuses its discretion when its decision is arbitrary, unreasonable, unfair, or

unsupported by sound legal principles. Commonwealth v. English, 993 S.W.2d

941, 945 (Ky. 1999).

In Saint Joseph Healthcare, Inc. v. Thomas, 487 S.W.3d 864 (Ky.

2016), the Supreme Court of Kentucky delineated “two different avenues for the

recovery of punitive damages: one statutory and one under common law.” Id. at

-6- 870. First, “KRS[1] 411.184(2) provides for the recovery of punitive damages ‘only

upon proving, by clear and convincing evidence, that the defendant from whom

such damages are sought acted toward the plaintiff with oppression, fraud or

malice.’” Id. Second, “punitive damages may also be awarded under the common

law standard of ‘gross negligence.’ Gross negligence means a ‘wanton or reckless

disregard for the lives, safety, or property of others.’” Id. (quoting Williams v.

Wilson, 972 S.W.2d 260 (Ky. 1998); Gibson v. Fuel Transport, Inc., 410 S.W.3d

56, 59-60 (Ky. 2013)). As such, our Supreme Court stated: “punitive damages

may be awarded, when the evidence satisfies either the statutory standard of KRS

411.184(2), or the common law standard of gross negligence.” Id.

“The threshold for the award of punitive damages is misconduct

involving something more than merely [the] commission of the tort.” Fowler v.

Mantooth, 683 S.W.2d 250, 252 (Ky. 1984). “[O]rdinarily the question of

negligence, whether it be gross or ordinary, is one for a jury to determine.”

Darnell v. Hamilton, 358 S.W.2d 361, 362 (Ky. 1962).

In Louisville SW Hotel, LLC v. Lindsey, the Supreme Court affirmed

submission of punitive damages where a hotel exhibited systematic disregard of

guest safety, ignoring basic protocols and warnings about a known hazard at its

pool. 636 S.W.3d 508 (Ky. 2021). The Court stressed that punitive exposure may

1 Kentucky Revised Statutes.

-7- rest on what an owner failed to do when dangers were foreseeable and within the

premises owner’s control. Id. at 514. Likewise, “[m]ultiple acts of negligence,

each of which—if considered in isolation—might not support a finding of

wantonness, may support a finding of gross negligence when considered alongside

one another.” Id.

Viewed in a light most favorable to the Estate, the evidence presented

at trial showed that the Econo Lodge’s management wholly failed to implement

even rudimentary safeguards governing the hotel’s water-heating system. Sanjay

Patel admitted that he had never maintained any written maintenance checklists or

protocols, had never adopted any procedures for inspecting or monitoring the

hotel’s water heaters, and had never used a thermostat to test the temperature of

water in any guest room. He acknowledged that he had never read the

manufacturer’s manual for the water heater and had not followed any of the safety

warnings it contained. Patel further conceded that he knew it was his

responsibility to monitor the temperature of the hotel’s water supply, that water

above 120 degrees Fahrenheit presents a serious scald risk, and that 150 degrees

Fahrenheit constitutes an unsafe condition. Yet, despite that knowledge, he

ignored a desk-log entry made just a week before in which a guest staying in the

same bank of rooms served by the heater at issue reported issues with the water

-8- temperature. No inspection of the heater or testing of the water in other rooms

followed.

Appellant’s own expert witness, Mark Cammack, P.E.,2 elaborated on

the gravity of these omissions. He testified that industry standards require hotel

owners to have systems for routine maintenance and periodic inspection of water-

heating equipment and to read and comply with manufacturers’ safety warnings.

According to Cammack, temperatures exceeding 120 degrees Fahrenheit pose a

“severe burn risk,” and water at 150 degrees Fahrenheit can cause third-degree

burns in less than two seconds.

On this record, the trial court, having observed the witnesses and the

evidentiary subtleties, determined the evidence would allow a reasonable jury to

find wanton or reckless disregard by clear and convincing proof, and thus

submitted punitive damages. The court later denied JNOV on the same ground. In

light of the degree of deference we must show to the trial court, we cannot

conclude that the court clearly erred. Based on the evidence adduced at trial, the

jury could certainly draw a reasonable inference that Appellants’ conduct

demonstrated an indifference to the goings-on related to the hot water heater and

its maintenance. In turn, the jury could reasonably conclude that this indifference

created a condition that posed a serious risk to the life and safety of its guests. We

2 Professional Engineer.

-9- are accordingly unable to conclude that the Estate failed to meet its burden of proof

regarding punitive damages. Louisville SW Hotel, LLC, 636 S.W.3d at 515.

B. Medical-Expense Award

Appellants next contend that the circuit court erred by refusing to

reduce the jury’s award of medical expenses to exclude the amounts written off by

Mr. Chronis’s healthcare providers.3 Because this issue concerns a question of

law, our review is de novo. 3D Enters. Contracting Corp. v. Louisville & Jefferson

Cnty. Metro. Sewer Dist., 174 S.W.3d 440, 445 (Ky. 2005).

Kentucky adheres to the long-standing collateral-source rule, which

provides that a tortfeasor may not mitigate damages by showing that the injured

party has received compensation or benefits from an independent source. Baptist

Healthcare Sys., Inc. v. Miller, 177 S.W.3d 676, 682 (Ky. 2005). The doctrine

rests on three independent policy foundations: (1) to deter wrongdoers from

benefitting from their misconduct, (2) to ensure full compensation to the injured

3 We note that no formal proof was introduced regarding the nature of the medical provider write offs. The fact that an amount is “written off” internally does not necessarily mean it is not collectable.

The term “written off” is a common business accounting term meaning only that the debt is removed from the internal bookkeeping procedures eliminating it as an accounts receivable. However, until the applicable statute of limitations expires, there is no legal impediment to the creditor’s pursuit of the debt. In fact, “written off” accounts are frequently sold to collection agencies who receive a percentage of the amount collected and the balance returned to the creditor.

Dennis v. Fulkerson, 343 S.W.3d 633, 638 (Ky. App. 2011) (Thompson, J., concurring).

-10- party, and (3) to allocate any windfall to the less culpable plaintiff rather than to

the tortfeasor. Id. at 682-83.

This Court, following the Kentucky Supreme Court’s reasoning in

Miller, supra, applied the same principle in City of Nicholasville Police

Department v. Abraham, 565 S.W.3d 639 (Ky. App. 2018). There, we held that

amounts “written[]off and never subject to indemnification or paid by a third-party

source” constitute collateral benefits that may not be used to reduce a verdict. Id.

at 647. As explained in Abraham, as between the innocent injured party and the

culpable defendant, “any so-called windfall . . . should accrue to the less culpable

injured party rather than [relieve] the tortfeasor of full responsibility for his

wrongdoing.” Id. (quoting Miller, 177 S.W.3d at 682).

Appellants acknowledge these precedents but attempt to distinguish

them, arguing that the collateral-source rule should not apply where, as here, the

medical write-off resulted from the medical providers’ unilateral decisions to

reduce their bills for an uninsured patient rather than from payments by an insurer

or Medicare. They contend that while a “windfall” may be justified when the

plaintiff has paid insurance premiums, it is inequitable to allow such recovery

when no premiums were paid, and no third-party source is involved.

As noted, in Miller, our Supreme Court articulated three independent

rationales for the collateral-source rule, and only one—the insurance-premium

-11- rationale—depends on a showing that the plaintiff contributed financially to the

benefit. The remaining two rationales—deterring wrongdoing and ensuring full

compensation—apply equally to write-offs for uninsured individuals. Moreover,

this Court has applied the rule to Medicaid discounts, even though many recipients

of Medicaid benefits personally pay no or very small premiums. Abraham, 565

S.W.3d at 646.

We decline Appellants’ invitation to carve out a new exception for

hospital write-offs. The circuit court correctly concluded that under Miller and

Abraham, the collateral-source rule barred any post-trial reduction of the jury’s

medical-expense award. If the rule is to be narrowed in the manner Appellants

propose, that decision lies with the Kentucky Supreme Court, not this Court.

Therefore, we affirm the circuit court’s ruling on this issue.

III. CONCLUSION

For the foregoing reasons, the judgment of the Kenton Circuit Court is

affirmed in all respects.

ALL CONCUR.

BRIEFS FOR APPELLANTS: BRIEF FOR APPELLEE:

Melissa Thompson Richardson N. Jeffrey Blankenship Sarah E. Laytham Covington, Kentucky Lexington, Kentucky Christopher T. Cain, pro hac vice Knoxville, Tennessee

-12-