United States: Wisconsin Supreme Court 2013-2014 Term Summary Part 3: Recap Of Cases Affecting Wisconsin Businesses

Last Updated: September 26 2014
Article by Philip C. Babler

This post is the third in a series of posts analyzing the 2013-14 term of the Wisconsin Supreme Court. For our previous posts click here and here.

This post provides in a nutshell what businesses need to know about the cases from last year's term of the Wisconsin Supreme Court.

We already have written about a number of the key business-related cases on our blog:

In Data Key Partners v. Permira Advisors LLC, the court adopted the federal courts' heightenedpleading standard from Twombly and reaffirmed the importance of the business-judgment rule in shareholder litigation. (Post here.)

In Dow Family, LLC v. PHH Mortgage Corp., the court declared that the equitable-assignment doctrine is alive and well, and it held that the doctrine applied to the widely used (and controversial) electronic mortgage-registration system, more commonly known as MERS. (Posts here and here.)

In Associated Bank N.A. v. Collier, the court effectively overruled In re Badger Lines, Inc. and limited the lien that attaches in supplementary proceedings under Wis. Stat. ch. 816. (Post here.)

In Kimble v. Land Concepts, Inc., the court used its discretionary reversal power to reverse an award of punitive damages, holding that the award was unconstitutional. A statutory limit on punitive damages exists now, found in Wis. Stat. § 895.043(6). But if that statute is ever repealed, the court's constitutional analysis in Kimble will substantially limit the availability of punitive damages in Wisconsin. (Post here.)

Two other cases that we have not yet written about deserve brief mention here:

In Adams v. Northland Equipment Company, Inc., the court clarified worker's compensation law. There, an employee was injured within the scope of his employment, and he sued a negligent third party whose actions contributed to the injury. The third party offered to settle the claim by paying $200,000 to the employee and the worker's compensation insurer. After the insurer accepted the offer, it asked the circuit court to compel the employee to accept the offer too. The supreme court held that a circuit court could compel an injured employee to accept a settlement offer under these circumstances.

Kochanski v. Speedway Superamerica LLC was a slip-and-fall case under Wisconsin's safe-place statute. The trial court gave the absent-witness instruction after defendant Speedway did not compel former employees to testify at trial. A jury returned a verdict for the plaintiff. The court of appeals and the supreme court held that the instruction was improper and warranted a new trial. Justice Bradley's dissent highlights the exacting standard of review exercised by the court over a jury verdict under the safe-place statute. Kochanski might work to limit awards under that statute in the future.

Finally, most interesting is what the court did not decide last term:

In Wisconsin Auto Title Loans Inc. v. Jones, the court of appeals certified the question of whether a circuit court's order denying a motion to compel arbitration is a final order under Wis. Stat. § 808.03, thereby making available an appeal as of right for the party seeking arbitration. The court accepted the certification, but the parties settled before the court could decide the case. (Our earlier post is here.)

In Weissman v. Tyson Prepared Foods, Inc., the supreme court had accepted review of a published opinion from the court of appeals that decided questions of first impression under Wisconsin wage laws: namely, the compensability of time employees spend donning and doffing protective gear before and after shifts. As we wrote previously, the parties settled and voluntarily dismissed the appeal before the court could hear it.

In Williams v. Valued Services of Wisconsin LLC, the court of appeals certified and the supreme court accepted the question of whether triple-digit interest rates on payday loans are unconscionable. The court of appeals previously had certified the same issue and then too the issue was evaded when the parties settled.

In State Farm v. Hague Quality Water, the court affirmed by an equally divided vote the published decision of the court of appeals that interpreted Wausau Tile's rule regarding when a product is an "integrated system" so that damage to one of its component parts is not damage to "other property" under the exception to the economic-loss doctrine. The case involved a water softener that failed and damaged drywall, flooring, and woodwork. Three justices would have affirmed and three would have reversed the finding that the water softener was not part of an integrated system that included the drywall, flooring, and woodwork.

This post is the final in our recap of the court's term. Stay tuned as we write about the court's decisions this term.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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