If you intend to bring a claim for or find yourself defending a claim for punitive damages, you will likely discover that there is simply not much case law in Wisconsin on the issue (specific to personal injury actions).

However, understanding the current statute, the legislative history behind the “new statute,” and the body of case law that does exist is as good a place as any to start.

Current and ‘New’

The statutory scheme for punitive damages is found in Wis. Stat. section 895.04(3):

The plaintiff may receive punitive damages if evidence is submitted showing that the defendant acted maliciously toward the plaintiff or in an intentional disregard of the rights of the plaintiff. ...

The legislature enacted Wis. Stat. § 895.043(3) in 1995, thereby altering Wisconsin's common law standard for punitive damages. Strenke, 2005 WI 25, 279 Wis. 2d 52, 19, 694 N.W.2d 296. In doing so, it heightened the state of mind required of a defendant from a "wanton, willful and reckless" disregard for rights of another to an "intentional disregard" for rights of another. Id.”¹ ...

Prior to the enactment of Wis. Stat. § 895.85(3), the common law established the standard of conduct governing the imposition of punitive damages. Under it, punitive damages could be awarded for “outrageous” conduct. Sharp v. CaseCorp., 227 Wis. 2d 1, 21, 595 N.W.2d 380 (1999). A person's conduct was “outrageous” if the person acted “either maliciously or in wanton, willful and in reckless disregard of the plaintiff's rights.” Id.²

With the passage of the new statute, the standard was no longer outrageous or malicious conduct. But what does “acting with an intentional disregard of someone’s rights” mean under the new statute?

A defendant acts with intentional disregard if he or she: (1) “acts with a purpose to cause the result or consequence,” or (2) “is aware that the result or consequence is substantially certain to occur from the person's conduct.” Accordingly, in order to fall within Wis. Stat. § 895.043(3), a defendant's conduct must be (1) deliberate, (2) in actual disregard of the rights of another, and (3) “sufficiently aggravated to warrant punishment by punitive damages.” We explained in Strenke that under this heightened threshold for punitive damages, we “expect circuit courts to serve as gatekeepers before sending a question on punitive damages to the jury.”³

Within the language of the statute itself, there are two mandatory elements as it relates to “intentional disregard:”

• acting with purpose to cause the result or consequence; and

• awareness that the result or consequence is substantially certain to occur.⁴

Case law has developed three elements that must exist for a punitive damage claim to survive:

• deliberate conduct;

• the rights of another must be actually disregarded; and

• the conduct must be sufficiently aggravated to warrant punishment.⁵

Strenke 1.0

Most practitioners are aware of the seminal punitive damages case in Wisconsin: Strenke. But be mindful of the fact there are two Strenke decisions – the OG Strenke case⁶ – let’s call it Strenke 1.0; and a second decision – Strenke 2.0 – that mostly focused on whether the amount of punitive damages awarded violated Strenke’s due process rights.⁷

Strenke 1.0 (Strenke v. Hogner, 2005 WI 25) is significant for many reasons, including that it overruled, in part, a portion of the “Big Blue” case (Wischer v. Mitsubishi Heavy Indus. Am. Inc.⁸). The Wischer court held that the phrase “intentional disregard of the rights of the plaintiff” included an intent element, specifically an intent to cause harm.⁹

[W]e are not persuaded by the interpretation of the Wischer court, which inserted words into the statute. Accordingly, we overrule that decision here.¹⁰

[W]e disagree with the Wischer court's interpretation of Wis. Stat. § 895.85(3). The legislature did not intend an “intentional disregard of the rights of the plaintiff” to require “intent to cause injury to the plaintiff.” Rather, it reaffirmed the common-law principle that punitive damages can be premised on conduct that is a “disregard of rights.” However, the legislature chose the word “intentional” to describe the heightened state of mind required of the defendant who disregards rights, instead of the common law's description of “wanton, willful and reckless.” Our interpretation of Wis. Stat. § 895.85(3) is supported by the language of the statute, the legislative history, and the common law meaning of the phrase in question.¹¹

The Strenke court provides additional support for its reading of the statutory language as it relates to an intent to cause harm:

If the legislature had intended to specify an “intent to injure” requirement, it could have easily done so. Indeed, there was another statute enacted in the same legislative session in which Wis. Stat. § 895.85(3) was enacted that demonstrates this point. Wisconsin Stat. § 895.525(4m) was created by 1995 Wis. Act 447 and allows liability of contact sports participants only “if the participant who caused the injury acted recklessly or with intent to cause injury.” There is no comparable language in Wis. Stat. § 895.85(3).¹²

Strenke 1.0 Key Takeaways

There are several key takeaways from Strenke 1.0:

• the courts must ask as gatekeepers;

• under the new statute there should be fewer cases giving rise to punitive damages; and

• conduct must be aggravated for it to be the basis for punitive damages.

As to gatekeeping:

... we expect circuit courts to serve as gatekeepers before sending a question on punitive damages to the jury. We stated this gatekeeper function in Bank of Sun Prairie v. Esser, 155 Wis. 2d 724, 735, 456 N.W.2d 585 (1990) (citing Topolewski v. Plankinton Packing Co., 143 Wis. 52, 70, 126 N.W. 554 (1910)) as follows:

The circuit court should not submit the issue of punitive damages to the jury in the absence of evidence warranting a conclusion to a reasonable certainty that the party against whom punitive damages may be awarded acted with the requisite ... conduct.

The court of appeals in Lievrouw, 157 Wis. 2d at 344, restated this articulation of the gatekeeper's function as follows:

Stated another way, a question on punitive damages may not be given to the jury unless the trial court concludes that a reasonable jury could find from the evidence that entitlement to punitive damages has been proven by the middle burden of proof, “clear and convincing evidence.”¹³

If you intend to bring a claim for punitive damages based on conduct that is negligent, carefully read Strenke 1.0. In reminding the courts of their gatekeeping duties, the Strenke court held that:

... punitive damages are not recoverable if the wrongdoer's conduct is merely negligent. Wangen, 97 Wis. 2d at 275. Furthermore, not every drunk driving case will give rise to punitive damages. Only when the conduct is so aggravated that it meets the elevated standard of an “intentional disregard of rights” should a circuit court send the issue to a jury.¹⁴

Practitioners also need to be aware of the Strenke court’s holding as to the impact the new statute should have on punitive damage cases:

Under the prior common law standard, it was accepted that ‘the vast majority of negligence cases do not give rise to the remedy of punitive damages.’ Brown, 124 Wis. 2d at 432. The legislature intended with the heightened standard that now there would be even fewer negligence cases giving rise to punitive damages.¹⁵

Finally, Strenke 1.0 is really the first place the concept of aggravated conduct is developed as it relates to the elements necessary for punitive damages to be appropriate:

... we conclude that a person acts in an intentional disregard of the rights of the plaintiff if the person acts with a purpose to disregard the plaintiff's rights, or is aware that his or her acts are substantially certain to result in the plaintiff's rights being disregarded. This will require that an act or course of conduct be deliberate. Additionally, the act or conduct must actually disregard the rights of the plaintiff, whether it be a right to safety, health or life, a property right, or some other right. Finally, the act or conduct mustbe sufficiently aggravated to warrant punishment by punitive damages.¹⁶

Conclusion: Two Other Cases to Know

Since the Strenke decision, there have been just two other significant decisions issued by the Wisconsin appellate courts relating to punitive damages specific to personal injury actions: Henrikson v. Strapon¹⁷ and Wosinski v. Advance Cast Stone, Co.¹⁸

While neither case altered the current standard for punitive damages in Wisconsin, practitioners should be aware of the Henrikson court’s discussion about the level of awareness required by a defendant to establish a basis for punitive damages:

The conviction for reckless driving also does not provide a reasonable basis for inferring the requisite awareness by Strapon. Wis. Stat. § 346.62(2) prohibits “endanger[ing] the safety of any person or property by the negligent operation of a vehicle.” A conviction of this charge requires proof beyond a reasonable doubt that a defendant's operation of a vehicle in a manner amounting to criminal negligence endangered the safety of a person or property. WIS JI-CRIMINAL 2650. Criminal negligence means the “defendant should have realized that the conduct created a substantial and unreasonable risk of death or great bodily harm to another.” Id. “Should have realized” that conduct created the prescribed risk requires a lesser degree of awareness than that required for punitive damages under the “aware that [one's conduct was] substantially certain” standard. See Strenke, 2005 WI 25, 3, 279 Wis. 2d 52, 694 N.W.2d 296.¹⁹

This article was originally published on the State Bar of Wisconsin’s Litigation Section Blog. Visit the State Bar sections or the Litigation Section webpages to learn more about the benefits of section membership.

Endnotes

¹Berner Cheese Corp. v. Krug, 2008 WI 95 at 63.

²Strenke v. Hogner, 2005 WI 25 at 15.

³Berner Cheese, 2008 WI 95at 64 (citations omitted).

⁴Id.

⁵Id.

⁶Strenke v. Hogner, 2005 WI 25.

⁷ This article does not focus on the proportionality considerations relative to a punitive damage award, but Stenke 2.0 (Strenke v. Hogner, 2005 WI App 194) is a must-read case if that is an issue you need to consider.

⁸ Wischer v. Mitsubishi Heavy Indus. Am. Inc, 2003 WI App 202, 267 Wis. 2d 638, 673 N.W.2d 303.

⁹Wischer, 2003 WI App 202 at 44.

¹⁰Strenke v. Hogner, 2005 WI 25 at 34.

¹¹Id. at 19.

¹²Id. at 21, emphasis added.

¹³Id. at 40-41.

¹⁴Id. at 42.

¹⁵Id. at 39.

¹⁶Id. at 38.

¹⁷Henrikson v. Strapon, 2008 WI App 145.

¹⁸Wosinski v. Advance Cast Stone, Co., 2017 WI App 51.

¹⁹Id. at 32.