General Steel Buildings Lawsuit: Colorado AG Case, Bragel, and Bacheller

General Steel Corporation, a Colorado-based seller of prefabricated steel buildings, has been the subject of a General Steel Buildings lawsuit history that includes a $4.5 million settlement with the Colorado Attorney General over deceptive sales practices, a malicious prosecution verdict in which a court trebled exemplary damages for “willful and wanton” litigation conduct, and years of overlapping suits with a competitor founded by a former employee. Consumer complaints echo the same themes the state pursued: shifting prices, retained deposits, and disputes that contracts route to arbitration in Denver.

The Colorado Attorney General’s $4.5 Million Case

In 2004, the Colorado Attorney General filed State of Colorado v. General Steel Domestic Sales, LLC in Colorado District Court. A judge found that “General Steel for years engaged in sales practices that were riddled with misrepresentations and omissions.”¹

The court ordered a $200,000 fine and required changes to how the company sold buildings.² A special master was appointed to oversee refunds. The judge also ordered General Steel to redraft its purchase order forms for legibility: at least twelve-point font, spacing between paragraphs, and individual customer initials on each contract condition.¹

The matter ultimately settled for $4.5 million after the judge determined the company had used “deceptive sales and marketing tactics.”³ The New Mexico Attorney General issued a statement to state residents about the company, and the California Attorney General opened an investigation into similar allegations.²

Arbitration in Denver: What the Bragel Case Showed

George Bragel, a Massachusetts customer, alleged General Steel misled him about building specifications, raised his price from an initial quote of $15,540 to a final $94,367, and delivered an incomplete shipment. He sued for breach of contract, fraud, and violations of the Massachusetts Consumer Protection Act.¹

General Steel moved to dismiss and pointed to a contract clause requiring binding arbitration in Denver, Colorado. Bragel argued the clause was unconscionable given the out-of-state forum, a limitation-of-damages provision, and the company’s documented history of deceptive practices. In July 2006, the court enforced the arbitration clause and sent the dispute to Denver.¹ For out-of-state buyers, the practical effect is that a courthouse lawsuit against General Steel may not proceed at all: the contract routes the fight to Colorado arbitration.

Malicious Prosecution and Trebled Damages: The Bacheller Verdict

General Steel and a related firm, Discount Steel Buildings, filed an arbitration complaint against former salesman Harold Bacheller after he went to work for competitor Universal Steel Buildings Corporation. The claims included breach of contract, intentional interference with business relations, and civil conspiracy. An arbitrator ruled for Bacheller on every count.⁴

Bacheller then sued General Steel, Discount Steel, and their respective presidents, Jeffrey Wayne Knight and Nathan Wright, for abuse of process, malicious prosecution, and civil conspiracy. A jury found for Bacheller on malicious prosecution against all four defendants, and on abuse of process against Discount Steel and Wright.⁵

The jury awarded $15,000 in actual and $60,000 in exemplary damages against General Steel for malicious prosecution. Discount Steel drew $5,000 actual and $35,000 exemplary on the same claim, plus $5,000 actual and $25,000 exemplary for abuse of process.⁴

The trial court trebled the exemplary damages against both corporate defendants after finding they had acted in a “willful and wanton manner” to harass, intimidate, and delay Bacheller. The court pointed to repeated meritless demands that Bacheller submit to an independent medical examination for the sole purpose of harassment, attempts to use discovery to obtain confidential customer information from Universal Steel as part of an ongoing “vendetta,” and concealment of a last-minute petition to the Colorado Supreme Court intended only to delay trial.⁴ Trebling raised General Steel’s exemplary damages from $15,000 to $45,000 and Discount Steel’s combined exemplary damages from $10,000 to $30,000.⁵

The Colorado Supreme Court affirmed the judgment in November 2012.⁴

The Armstrong Steel Litigation

Ethan Daniel Chumley left General Steel in July 2005 and founded Atlantic Building Systems, doing business as Armstrong Steel, a direct competitor.⁶ The two companies have traded lawsuits ever since.⁷

General Steel’s False Advertising Win

In a bench trial, a district court found Armstrong had made three “literally false” statements under the Lanham Act: that it fabricated its own steel when it actually bought steel from others, that it sold “General Steel” buildings (implying an affiliation that did not exist), and that General Steel did not offer certain features that both companies in fact sold as paid options. The court ordered disgorgement of Armstrong’s profits and injunctive relief. In July 2015, the Tenth Circuit, in an opinion by then-Judge Neil Gorsuch, affirmed in full.⁸

The Website and Section 230 Fight

General Steel alleged that Chumley bought the domain generalsteelscam.com in 2011 to host defamatory content, and that after General Steel took control of that domain through an international ruling, Chumley registered steelbuildingcomplaints.com as a replacement. General Steel further alleged that starting in December 2012, Chumley contacted General Steel customers while falsely claiming to be an investigator with the Colorado Attorney General’s Office or an agent of a fictitious “Consumer Advocacy Alliance—General Steel Investigation Unit.”⁶

Armstrong ran an “Industry Related Legal Matters” page with 37 posts summarizing and quoting court documents from General Steel’s litigation, with Google ads triggered by searches for “General Steel.” General Steel challenged 20 posts, bringing claims for unfair competition under the Lanham Act, libel, intentional interference with prospective business advantage, and civil conspiracy. Armstrong invoked Section 230 of the Communications Decency Act. The district court rejected that defense for most posts, finding Armstrong had “created and developed” the content by selectively highlighting unfavorable allegations while omitting context and resolutions. Only three posts, which merely linked to third-party material, received Section 230 immunity. The Tenth Circuit dismissed Armstrong’s interlocutory appeal in November 2016 on jurisdictional grounds.⁷ The case went to a jury trial before Chief Judge Marcia S. Krieger and terminated on July 5, 2016.⁹

Armstrong’s Counterclaims

Armstrong countersued, alleging General Steel ran its own false advertising, including claiming a 1928 founding date when the company was actually established in 1995, asserting it had provided armaments during World War II, and misappropriating Armstrong’s trademarked logo on General Steel websites to redirect traffic.⁶ A magistrate judge recommended denying General Steel’s motion to dismiss those Lanham Act counterclaims but granting dismissal of claims against CEO Jeffrey Knight personally, because Armstrong had not shown Knight’s direct personal participation in the alleged conduct.¹⁰

What Consumers Keep Complaining About

Consumer grievances against General Steel have followed a consistent pattern across years. They fall into a few recurring categories.

Deposit retention. Customers report paying deposits from several thousand dollars to more than $60,000 and being unable to recover them when projects stall, financing collapses, or the product does not match the description. General Steel has declined to provide itemized breakdowns of actual damages and directed customers to arbitration.¹¹
Price escalation. Initial quotes grow as charges get added for windows, doors, engineering drawings, and components buyers thought were included. In a 2025 complaint, a customer disputed a $7,262 “steel price increase” fee the customer said resulted from the company’s own delay in supplying blueprints.¹¹
Bait-and-switch allegations. Some buyers say marketing showed “Red Iron I-beam” construction, but quotes or shipments used lighter “C-Channel” framing instead. In a 2024 case, a customer alleged the originally advertised product was offered only after the company demanded an additional $19,800.¹¹
Delivery problems. Reports describe long delays, incomplete shipments missing structural components, damaged or rusted materials, and undisclosed fees for storage or logistics.¹²

As of mid-2026, General Steel holds an A+ rating and BBB accreditation, with six complaints filed in the preceding three years. The most recent, filed in April 2026, involved a customer disputing retention of a $14,550 deposit after canceling a contract two weeks after signing, with no substantive work performed. General Steel said the retention was consistent with the contract terms; the customer reported initiating arbitration.¹¹

Who Runs the Company

General Steel Corporation is based in Colorado and sells prefabricated steel buildings nationwide. Court records identify Jeffrey Wayne Knight as the company’s sole shareholder, president, and CEO.⁴ The related company Discount Steel Buildings, LLC, led by Nathan Wright, has appeared alongside General Steel as a co-defendant, though the two are separate corporate entities.⁵ Courts have declined to hold Knight personally liable where plaintiffs did not show his direct personal involvement in specific alleged misconduct.¹⁰

1
Mass Lawyers Weekly. Bragel v. General Steel Corp.
2
Jonathan G. Stein, Attorney at Law. General Steel Buildings
3
Denver7. Englewood-Based Armstrong Steel Faces Class Action Lawsuit
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Findlaw. General Steel Domestic Sales, LLC v. Bacheller III
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vLex. Gen. Steel Domestic Sales, LLC v. Bacheller
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vLex. Gen. Steel Domestic Sales, LLC v. Chumley
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Findlaw. General Steel Domestic Sales v. Chumley
8
U.S. Court of Appeals for the Tenth Circuit. General Steel Domestic Sales v. Chumley
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CourtListener. General Steel Domestic Sales, LLC v. Chumley
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GovInfo. General Steel Domestic Sales, LLC v. Chumley – Magistrate Recommendation
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BBB. General Steel Corporation – Complaints
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ConsumerAffairs. General Steel Reviews