Schumacher Homes, the Canton, Ohio custom builder, has been involved in lawsuits on both sides of the courtroom: as a defendant facing construction-defect claims from homeowners, and as a plaintiff suing customers and business partners. The most closely watched Schumacher Homes lawsuit came out of North Carolina, where a federal judge ruled in 2022 that the company forfeited its right to force a homeowner dispute into private arbitration after it chose to sue the couple for defamation first. Several other cases have tested whether the arbitration clause in Schumacher’s standard purchase agreement is enforceable at all.
The North Carolina “Schumacher Victims” Case
Keith and Dianna Buchanan contracted with Schumacher Homes in 2018 to build a custom home in McDowell County, North Carolina. After moving in, they alleged the foundation was “completely defective,” causing structural shifting, sagging floors, and cracking walls. They put the damage at more than $500,000 and said the house would have to be torn down and rebuilt.1Charlotte Observer. Schumacher Homes Sues NC Couple Over Smear Campaign Allegations
The Buchanans went public. They built a website called schumachervictims.com that gathered photographs of Schumacher-built homes, links to file complaints with the North Carolina Licensing Board for General Contractors and the state Attorney General’s consumer protection division, and aggregated Better Business Bureau complaints and licensing actions. Keith Buchanan said in a court affidavit that at least 10 other homeowners had contacted the couple with similar experiences. The couple also emailed prospective Schumacher customers directly, alleging the builder used unqualified labor, lacked general contractors on job sites, and used inferior materials.1Charlotte Observer. Schumacher Homes Sues NC Couple Over Smear Campaign Allegations
The Defamation Suit
In late September 2021, Schumacher Homes of North Carolina and regional manager Richard Smothers sued the Buchanans in the U.S. District Court for the Western District of North Carolina. The complaint called the couple’s activities a “smear campaign” and alleged commercial defamation, tortious interference with contract and prospective economic advantage, unfair and deceptive business practices, and civil conspiracy. It sought damages, attorney’s fees, a declaratory judgment that the couple’s claims were false, and an injunction shutting down the website and email campaign. Schumacher argued the house had passed multiple county inspections and that the Buchanans had refused to let warranty representatives onto the property.1Charlotte Observer. Schumacher Homes Sues NC Couple Over Smear Campaign Allegations
At the first hearing in October 2021, Judge Max O. Cogburn Jr. largely denied Schumacher’s request for a preliminary injunction. He did order the Buchanans to stop sending unsolicited electronic communications to the company’s customers, a condition the couple agreed to follow.2Reason (Volokh Conspiracy). Libel Lawsuit Against Consumer Waives Right to Arbitration of Underlying Dispute
The Arbitration Waiver Ruling
The Buchanans filed counterclaims for the construction defects. Schumacher then moved to compel arbitration of those counterclaims, pointing to an arbitration clause in the original building contract. In July 2022, Judge Cogburn denied that motion.
The court found Schumacher had waived arbitration by “substantially utilizing the litigation machinery.” The company had chosen federal court, obtained a preliminary injunction, and waited three months before asking for arbitration. Running both proceedings in parallel would be “duplicative, wasteful, and inefficient,” Cogburn wrote, because both would turn on whether the house was actually defective. The ruling kept the whole dispute in federal court and blocked the builder from picking its forum after the fact.2Reason (Volokh Conspiracy). Libel Lawsuit Against Consumer Waives Right to Arbitration of Underlying Dispute
The case was resolved through mediation. In November 2023, the parties announced a settlement and filed a stipulation of voluntary dismissal. The terms were not publicly disclosed.3Mealey’s Litigation Report. In N.C. Federal Court, Parties Announce Settlement of Construction Defects Case
Arbitration Clause Fights in Other States
Schumacher’s purchase agreements require homeowners to take disputes to binding arbitration rather than court, and homeowners in two other states have challenged that requirement with mixed results.
Ohio: Norman v. Schumacher Homes
Jessica Norman challenged the clause after a dispute over whether her home was supposed to include a full basement or a crawl space. She argued fraudulent inducement and said arbitration costs were prohibitive. The Fourth District Court of Appeals of Ohio upheld the clause in a June 2013 ruling, finding it was not ambiguous, that Norman had produced no evidence arbitration would cost more than litigation, and that her fraud claims went to the construction of the home, not to the arbitration provision itself.4Supreme Court of Ohio. Norman v. Schumacher Homes of Circleville, 2013-Ohio-2687
West Virginia: Schumacher Homes v. Spencer
John and Carolyn Spencer sued Schumacher in the Circuit Court of Mason County in 2013 over alleged defects in their Milton home. When Schumacher moved to compel arbitration, the circuit court refused, calling the arbitration agreement unconscionable. The court noted a provision that preserved Schumacher’s mechanic’s lien rights while requiring homeowners to arbitrate, and viewed that as lacking mutuality.5West Virginia Judiciary. Schumacher Homes of Circleville v. Spencer, No. 14-0441
The West Virginia Supreme Court of Appeals initially affirmed, finding a “delegation provision” (stating that “the arbitrator(s) shall determine all issues regarding the arbitrability of the dispute”) unenforceable because “arbitrability” was ambiguous. After Schumacher petitioned the U.S. Supreme Court, the case was sent back for reconsideration in light of DIRECTV, Inc. v. Imburgia. On remand, the West Virginia court reversed itself. Because the Spencers had challenged the arbitration agreement as a whole rather than attacking the delegation provision specifically, that provision had to be treated as valid under the Federal Arbitration Act. The case went back to the circuit court with instructions to send the enforceability question to an arbitrator.6Findlaw. Schumacher Homes of Circleville v. Spencer
A Florida Business Dispute
Not all Schumacher lawsuits involve homeowners. In March 2023, Schumacher Homes Operations, Inc. sued a defendant named Dickens in the U.S. District Court for the Southern District of Florida, alleging a Miami developer embezzled more than $10 million from projects Schumacher was contracted to build in a Bahamian resort community. The complaint raised fraud and contract claims.7Law360. Schumacher Homes Operations v. Dickens et al. The parties filed a stipulation of dismissal in February 2024, ending the case.8CourtListener. Schumacher Homes Operations, Inc. v. Dickens, 1:23-cv-20819
Complaints Outside of Court
Schumacher holds an A+ rating from the Better Business Bureau and has been BBB-accredited since 2004. It has also drawn a steady flow of consumer complaints: 27 in the three years leading up to mid-2026, seven of them closed in the most recent 12-month period. Eighteen of the 27 involved service or repair issues, with the rest split among order disputes, billing, customer service, and product or advertising concerns.9Better Business Bureau. Schumacher Homes Customer Complaints
Common themes echo the litigation record: plumbing failures, water intrusion, foundation and moisture problems, and flooring and framing defects. Homeowners have alleged that repair attempts were inadequate and that multiple site visits failed to fix the underlying problem. A recurring flashpoint is the scope of Schumacher’s limited warranty. Homeowners argue defects come from improper construction; the company has attributed some issues to weather damage or to conditions that fall outside the warranty period, and has pointed in BBB responses to municipal inspections and certificates of occupancy as evidence that homes met code.9Better Business Bureau. Schumacher Homes Customer Complaints
In one complaint filed in early 2026, a homeowner cited a structural engineer’s findings of moisture intrusion and unlevel flooring and asked for a full buyback. Schumacher rejected the request, saying there was “no contractual or legal basis” for a home repurchase. As of March 2026, the homeowner said they were engaging a forensic engineering firm for an independent assessment.9Better Business Bureau. Schumacher Homes Customer Complaints
What the Record Shows for Homeowners
If you’re a Schumacher customer weighing your options after a defect dispute, two threads matter. First, the contract you signed almost certainly sends disputes to arbitration, and Ohio and West Virginia courts have both upheld that clause when it was challenged directly. Second, arbitration can still be lost. In the Buchanan case, Schumacher’s own decision to sue first, litigate for months, and only later invoke arbitration was what cost it the right to that forum. The company’s willingness to sue vocal customers for defamation is part of the record too.