Wisconsin Lawyer
Vol. 78, No. 9, September 2005

Supreme Court Digest

by Prof. Daniel D. Blinka & Prof. Thomas J. Hammer

Antitrust Civil Procedure Criminal Law Criminal Procedure Guardianships

Jury Trial Open Records Law Public Works Projects Torts

Antitrust

Interstate Commerce - Wis. Stat. chapter 133

Olstad v. Microsoft Corp., 2005 WI 121 (filed 13 July 2005)

Olstad, acting on his own behalf and as a class representative, sued Microsoft for violating Wis. Stat. chapter 133 by allegedly engaging in monopolistic activities. The circuit court granted summary judgment in favor of Microsoft and dismissed the complaint because, the court concluded, Wis. Stat. section 133.03 applies only to intrastate commerce. The court of appeals certified a single issue to the supreme court: Does Wis. Stat. section 133.03 apply to interstate commerce that affects Wisconsin commerce?

The supreme court, in an opinion written by Justice Prosser, reversed the circuit court. Microsoft conceded that a state may "enact a statute reaching interstate commerce" but argued that Wisconsin had not done so. Because the issue required interpretation of section 133.03, the court extensively reviewed the history of federal and Wisconsin antitrust regulation, particularly the Wisconsin legislature's intent when it repealed and recreated chapter 133 in 1980. (Space limitations preclude inclusion of a synopsis of the historical background.) The supreme court concluded that chapter 133, particularly section 133.03, "applies to interstate commerce, at least in some circumstances" (¶ 74). "Consistent with this holding," the court withdrew the language from Conley Publishing Group v. Journal Communications, 2003 WI 119, ¶16, __ Wis. 2d __, __ N.W.2d __, that "`the scope of Chapter 133 is limited to intrastate transactions'" (¶ 74).

Thus, "[a] civil plaintiff filing an action under Wisconsin's antitrust act must allege that (1) actionable conduct, such as the formation of a combination or conspiracy, occurred within this state, even if its effects are felt primarily outside Wisconsin; or (2) the conduct complained of `substantially affects' the people of Wisconsin and has impacts in this state, even if the illegal activity resulting in those impacts occurred predominantly or exclusively outside this state" (¶ 85).

Chief Justice Abrahamson and Justice Bradley did not participate.

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Civil Procedure

Evidence - Expert Privilege

Carney-Hayes v. Northwest Wis. Home Care Inc., 2005 WI 118 (filed 12 July 2005)

The plaintiff sued a nursing home and one of its employees, Avery, alleging that they had negligently provided emergency nursing treatment. During discovery, the plaintiff sought to compel expert opinion testimony from Avery and two other nursing home employees not named as parties regarding the standard of care. All three refused to provide such testimony, relying on the expert privilege first recognized in Burnett v. Alt, 224 Wis. 2d 72, 589 N.W.2d 21 (1999) and Glenn v. Plante, 2004 WI 24, 269 Wis. 2d 575, 676 N.W.2d 413. After several hearings, the circuit court compelled Avery to testify but refused to order the other two employees to testify.

On bypass from the court of appeals, the supreme court, in an opinion written by Justice Prosser, affirmed in part and reversed in part the circuit court's decision. The supreme court's opinion reaffirmed Alt while "clarify[ing] the duties and privileges of medical witnesses in a medical malpractice case" (¶ 5). The court laid out three categories of medical testimony. First, medical witnesses may be compelled to testify to "facts." "A medical witness may be asked about her own conduct relevant to the case, including her observations and thought processes, her treatment of the patient, why she took or did not take certain actions, what institutional rules and regulations she believed applied to her conduct, and her training and education pertaining to the relevant subject. Every person has a right to this factual evidence" (¶ 28). Second, "the heart of the Alt opinion is that a medical witness who is unwilling to testify as an expert cannot be forced to give her opinion of the standard of care applicable to another person or her opinion of the treatment provided by another person" (¶ 30).

Third, "medical witnesses who have been accused of malpractice - negligence causing injury - who may be party defendants" (¶ 36) may be compelled to testify to the "proper" treatment and questions relating to cause (see ¶ 39, quoting Shurpit v. Brah, 30 Wis. 2d 388, 141 N.W.2d 266 (1966)). In Carney-Hayes the court affirmed the Shurpit rule but cautioned: "[W]e understand that a plaintiff may be motivated to name a medical witness as a defendant or otherwise accuse the medical witness of causal negligence in order to transform the person from an Alt witness (who is not required to give expert opinions) to a Shurpit witness who is so required. It is improper to name a person a party defendant for the purpose of eliciting an expert opinion from the person, because such a person will not be compensated as an expert, will have to spend time preparing for testimony as an expert, and will normally have to retain counsel. Courts should not permit litigants to make end runs around Alt and Glenn by using this tactic. Accordingly, the circuit court may assess the reasonableness and good faith of a decision to make a person a Shurpit witness by naming the person as a defendant or otherwise accusing the witness of causal negligence" (¶ 42). The supreme court cautioned that circuit courts "must assure that a defendant/witness from whom expert testimony is required is not asked to give opinions on subjects beyond the witness's competence" (¶ 45, citing Wis. Stat. §§ 907.02, 904.02, .03, 906.11).

The supreme court then applied the analysis to the three witnesses. Because Avery was accused of providing negligent medical treatment, she was required to answer questions about the facts and the standard of care (see ¶ 49). Specifically, "she is a Shurpit witness" (¶ 50). The second witness, a case manager, must testify about the plan of care that she prepared but may not be compelled to address the standard of care, because she was not present at the time of the injury and her expert opinion is not "unique or irreplaceable" (¶ 52). The third witness, the director of extended care services, must testify about her own actions, any training she provided to Avery, and the nursing home's training standards, but she too may not be compelled to testify regarding the general standard of care (see ¶ 60).

Justice Wilcox concurred but wrote separately to clarify the reach of the expert privilege. Justice Bradley, joined by Chief Justice Abrahamson and Justice Butler, concurred in part and dissented in part in an opinion that elucidates the continuing confusion that plagues the expert privilege. Justice Butler, joined by Chief Justice Abrahamson and Justice Bradley, also concurred in part and dissented in part. Under their analysis, both Avery and the case manager could be compelled to testify about the standard of care.

Physician-Patient Privilege - Waivers - Exceptions

Johnson v. Rogers Memorial Hosp. Inc., 2005 WI 114 (filed 8 July 2005)

The plaintiffs claimed that therapists implanted and reinforced in their daughter's mind false memories of intrafamily sexual abuse allegedly perpetrated by the parents. The parents unsuccessfully sought discovery of their adult daughter's treatment record. The daughter refused to waive her health care provider-patient privilege under Wis. Stat. section 905.04 or agree to the disclosure of her confidential medical records. The supreme court accepted certification from the court of appeals to determine whether an exception to the privilege should be recognized in cases such as this. The parents argued that the court need not address this issue because the daughter had waived the privilege or, alternatively, because her statements to an unlicensed therapist are not privileged.

The supreme court, in an opinion authored by Justice Butler, reversed the circuit court. First, the court held that the daughter did not waive the privilege under section 905.04. The parents argued that the daughter "waived her privilege by: (a) signing the authorization for medical documents release; (b) providing her medical and treatment billing statements; (c) inviting the Johnsons into her therapy sessions for confronting them about the alleged abuse; (d) discussing her therapy with her high school friend ...; (e) filing a restraining order against the Johnsons; and (f) relaying certain information to her attorney when she contemplated civil action against the Johnsons for the abuse. We do not agree that any of these actions or disclosures caused [the daughter] to waive her privilege" (¶ 37). Second, the court held that the daughter correctly asserted the privilege with respect to her communications with an unlicensed professional therapist because she reasonably believed that her discussions with him would be confidential (see ¶ 55).

The court held, however, that "public policy requires creating an exception to therapist-patient confidentiality and privilege where negligent therapy is alleged to have caused accusations against parents for sexually or physically abusing their child. Consistent with the significant purposes underlying the privilege, however, we are still concerned with maintaining and protecting the therapist-patient relationship to the greatest extent possible. Along similar lines, we also are sensitive to the implications of requiring a patient's records automatically be surrendered whenever a lawsuit such as this is commenced. Fishing expeditions cannot be allowed. Therefore, we further conclude that an in camera inspection of the patient's records is necessary. For guidance on how to fashion the prerequisites and parameters of this in camera inspection to limit the disclosure of privileged and confidential material, we turn to criminal law" (¶ 71). (The discovery procedure, which is based upon, but deviates from, criminal procedure, is described at paragraphs 74 to 76 of the opinion.)

Justice Prosser concurred, joined by Justice Wilcox (regarding the waiver issue) and Justice Crooks (the entire concurrence). Although Justice Prosser joined with the majority on most matters, he found that the daughter had waived confidentiality and the privilege through her voluntary disclosures. Justice Wilcox concurred in part and dissented in part. Justice Bradley, joined by Chief Justice Abrahamson, dissented on the ground that "[t]he rationale proffered by the lead opinion in carving out an exception to the patient-therapist privilege and right of confidentiality, and in engrafting criminal procedure to implement the exception, is supported neither by public policy nor precedent" (¶ 152).

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Criminal Law

Child Support - Evidence

State v. Smith, 2005 WI 104 (filed 6 July 2005)

Smith was convicted of two counts of felony failure to pay child support. The court of appeals reversed his conviction because it found that the circuit court had made an error in the jury instructions - the jury should have been instructed to consider whether a "court of competent jurisdiction" entered the child support order - and that the circuit court should not have admitted a certified copy of a Maine court's child support order.

The supreme court, in an opinion written by Justice Roggensack, reversed the court of appeals. First, the issue of whether a "court of competent jurisdiction" entered the child support order is not an element of the crime under Wis. Stat. section 948.22(1)(a). "Further, because Smith has not identified a historical fact inconsistent with an incident of the Maine court's jurisdiction that he and the State dispute, whether a court of competent jurisdiction ordered him to pay child support was a purely legal question for the court to determine" (¶ 23). In essence, the principles of claim preclusion barred Smith from collaterally attacking the Maine judgment through the Wisconsin criminal prosecution.

Second, the supreme court held that the circuit court properly admitted a certified copy of the Maine child support order. A federal statute that required a judge's certificate was an alternative means of authenticating the order, not the exclusive means. In this case a circuit court clerk authenticated the certified copy that was entered into evidence: the witness, "an employee of the clerk of circuit court's office, testified that the certified copy of the Maine court order, with the raised seal of that court, was in the circuit court's file for the underlying child support case, 92-FA-021. She compared that certified copy with Exhibit 3 and verified that Exhibit 3 was a copy of the certified copy of the Maine order. Therefore, she had knowledge, and testified accordingly, that the certified copy of the Maine court order had been found in the public office where an item of its nature is kept and that Exhibit 3 was a copy of that order" (¶ 33).

Justice Butler concurred with the holding that sufficient evidence supported the conviction but dissented on the ground that Smith had the right to challenge the lawfulness of the Maine court order in the Wisconsin prosecution.

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Criminal Procedure

Confessions - Voluntariness - Juveniles - Recording

State v. Jerrell C.J., 2005 WI 105 (filed 7 July 2005)

Jerrell was adjudged delinquent for his role in an armed robbery. The court of appeals affirmed the judgment.

The supreme court, in a decision authored by Justice Bradley, reversed in a landmark opinion. First, the court held that the juvenile's confession to police was involuntary and that its use violated his due process rights. Voluntary statements are statements that are the product of a "free will" as determined under the totality of the circumstances. "Special caution" is taken when assessing the voluntary nature of juvenile interrogations. A predicate to a finding of involuntariness is coercive or improper police conduct (see ¶¶ 18-21). In finding that Jerrell's interrogation produced an involuntary statement, the court closely examined the duration ("multiple hours") and the likely psychological effects of the techniques (for example, a "strong voice," and an expressed refusal to believe Jerrell's denials) on a youth with Jerrell's characteristics.

Second, the court declined to abandon the "totality of the circumstances" rule that applies to juveniles and to adopt instead a per se rule that would in effect require children under age 16 to be given an opportunity to consult with a parent or interested adult. The court reminded police, however, that statutes require an "immediate attempt" to notify parents when a juvenile is taken into custody and that in some cases depriving the juvenile of an opportunity to speak with parents is "strong evidence" of coercive conduct (¶ 43).

Third, the court exercised its supervisory power to create rules of evidence and held as follows: "All custodial interrogation of juveniles in future cases shall be electronically recorded where feasible, and without exception when questioning occurs at a place of detention. Audiotaping is sufficient to satisfy our requirement; however, videotaping may provide an even more complete picture of what transpired during the interrogation" (¶ 58). "First, a recording requirement will provide courts with a more accurate and reliable record of a juvenile's interrogation" (¶ 51). "Second, an accurate record will reduce the number of disputes over Miranda and voluntariness issues for juveniles" (¶ 52). "Third, recording will protect the individual interest of police officers wrongfully accused of improper tactics" (¶ 53). "Fourth, a recording requirement will enhance law enforcement interrogations of juveniles" (¶ 54). "Finally, such a rule will protect the rights of the accused" (¶ 55).

Chief Justice Abrahamson concurred and wrote separately to address the court's constitutional superintending authority and to advocate a per se rule that would require juveniles under age 16 to have the opportunity to consult with an adult. (Justices Bradley, Crooks, and Butler joined in the first part of the concurrence.) Justice Butler filed a separate concurring opinion that addressed juvenile-interrogation tactics. Justice Prosser concurred that Jerrell's statement was involuntary but dissented from the court's creation of the mandatory electronic recording rule, arguing that the court was dictating law enforcement practices under the guise of regulating the admissibility of evidence at trial. Justice Roggensack, joined in part by Justice Wilcox, also concurred with the holding that Jerrell's statement was involuntary but dissented from adoption of the rule of admissibility that, in effect, mandates electronic recording of interrogations, because adoption of the rule exceeds the court's superintending authority.

Pre-Trial Identification Procedures - Showups

State v. Dubose, 2005 WI 126 (filed 14 July 2005)

A "showup" is an out-of-court pretrial identification procedure in which a suspect is presented singly to a witness for identification purposes (see ¶ 1 n.1). In this case, after the defendant was arrested, he was placed in the rear seat of a squad car. The police asked the victim of an armed robbery to view the defendant. The officers told the victim that the defendant was possibly one of the men who had robbed him. The victim said that he was "98%" certain that the defendant was one of the perpetrators. Approximately 10 to 15 minutes after the first showup, the police conducted a second showup. This time, the victim identified the defendant, who was alone in a room at the police station, through a two-way mirror. The victim told police that the defendant was the same man he observed at the previous showup and that he believed the defendant was the man who robbed him. A short time after the second showup, the police showed the victim a mug shot of the defendant, and the victim identified the defendant a third time.

The defendant moved to suppress the victim's out-of-court identifications of him. The circuit court denied the motion after determining that the procedures used were neither impermissibly suggestive nor the product of an illegal arrest. At trial, the victim testified about the showups and made an in-court identification of the defendant. The jury convicted the defendant, and the court of appeals affirmed. In a majority decision authored by Justice Crooks, the supreme court reversed.

The defendant argued that the supreme court should apply a per se exclusionary rule in cases in which out-of-court identifications are impermissibly suggestive. The state urged the court to reaffirm its adherence to certain decisions of the U.S. Supreme Court and to conclude that evidence from an impermissibly suggestive out-of-court identification can still be used at trial if, based on the totality of the circumstances, the identification is reliable.

The majority responded by adopting a different test in Wisconsin regarding the admissibility of showup identifications. "We conclude that evidence obtained from an out-of-court showup is inherently suggestive and will not be admissible unless, based on the totality of the circumstances, the procedure was necessary. A showup will not be necessary, however, unless the police lacked probable cause to make an arrest or, as a result of other exigent circumstances, could not have conducted a lineup or photo array. A lineup or photo array is generally fairer than a showup, because it distributes the probability of identification among the number of persons arrayed, thus reducing the risk of a misidentification. In a showup, however, the only option for the witness is to decide whether to identify the suspect" (¶ 33).

"We emphasize that our approach, which is based to some extent on the recommendations of the Wisconsin Innocence Project, is not a per se exclusionary rule like [the defendant] requests. Showups have been a useful instrument in investigating and prosecuting criminal cases, and there will continue to be circumstances in which such a procedure is necessary and appropriate" (¶ 34). An example of this would be when the police apprehend a suspect during a Terry stop. If that person is suspected of committing a crime, but the police do not have the requisite probable cause to arrest and then to conduct a lineup or photo array, a showup could be considered necessary" (id. n.11).

"If and when the police determine that a showup is necessary, special care must be taken to minimize potential suggestiveness. We recommend procedures similar to those proposed by the Wisconsin Innocence Project to help make showup identifications as non-suggestive as possible. For example, it is important that showups are not conducted in locations, or in a manner, that implicitly conveys to the witness that the suspect is guilty. Showups conducted in police stations, squad cars, or with the suspect in handcuffs that are visible to any witness, all carry with them inferences of guilt, and thus should be considered suggestive. Next, officers investigating the matter at issue should proceed with caution in instructing the witness. The investigators must realize that `a witness's memory of an event can be fragile and that the amount and accuracy of the information obtained from a witness depends in part on the method of questioning.' Therefore, an eyewitness should be told that the real suspect may or may not be present, and that the investigation will continue regardless of the result of the impending identification procedure. Finally, it is important that a suspect be shown to the witness only once. If a suspect is identified, the police have no reason to conduct further identification procedures. Conversely, if the suspect is not identified by the witness, he or she should not be presented to that witness in any subsequent showups. While this list is far from complete, a showup conducted in accord with these standards will do much to alleviate the inherent suggestiveness of the procedure" (¶ 35) (citation omitted).

Applying this approach to the facts before it, the court concluded that the showups conducted were unnecessarily suggestive and that the admission of identification evidence denied the defendant his right to due process under article I, section 8 of the Wisconsin Constitution. "First, there existed sufficient facts at the time of [the defendant's] arrest to establish probable cause for his arrest. It was not necessary for the police to conduct the showups, since they had sufficient evidence against [the defendant] to arrest him without such showups. Next, the officers handcuffed [the defendant] and placed him in the back seat of a squad car. By placing a suspect in a squad car, the police implicitly suggest that they believe the suspect is the offender. ... Third, the police officers told the witness ... that they may have caught `one of the guys' who had robbed him. Such a comment is suggestive and, as studies have shown, greatly increases the chance of misidentification. Although the court of appeals stated that it found `nothing wrong with a police procedure where officers indicate an individual is a possible suspect,' we consider such a comment unnecessarily suggestive. Finally, after the first showup was conducted and [the defendant] was positively identified, the police still conducted two more identification procedures, another showup and a photo of [the defendant], at the police station shortly after [the defendant's] arrival. These subsequent identification procedures were unnecessarily suggestive. ... While our focus is on the two showups that occurred here, the photo identification by showing [the victim] a mug shot of [the defendant], was also unnecessarily suggestive and that out-of-court identification should have been suppressed" (¶¶ 36-37).

The court recognized that the exclusion of evidence of the out-of-court identifications does not deprive the prosecutor of reliable evidence of guilt. The witness would still be permitted to identify the defendant in court if that identification is based on an independent source. "In other words, if the circuit court determines that any in-court identification of [the defendant] was not tainted by out-of-court identifications, then the conviction should stand. The in-court identification is admissible if the State carries the burden of showing by clear and convincing evidence that the in-court identifications were based upon observations of the suspect other than the out-of-court identification" (¶ 38) (citations and internal quotations omitted).

Justice Butler, joined by Justice Crooks, filed a concurring opinion to respond to Justice Roggensack's dissent. Justices Wilcox, Prosser, and Roggensack filed separate dissenting opinions.

Intentional Violation of Miranda - Suppression of Physical Evidence Obtained as Direct Result of Miranda Violation

State v. Knapp, 2005 WI 127 (filed 14 July 2005)

This case was before the Wisconsin Supreme Court on remand from the U.S. Supreme Court, which had vacated the state supreme court's decision in State v. Knapp, 2003 WI 121, 265 Wis. 2d 278, 666 N.W.2d 881 (Knapp I). In Knapp I, the state supreme court concluded that physical evidence obtained as the direct result of a Miranda violation is inadmissible when the violation was an intentional attempt to prevent the suspect from exercising Fifth Amendment rights. In light of United States v. Patane, 542 U.S. 630 (2004), in which a plurality of the U.S. Supreme Court concluded that the fruit of the poisonous tree doctrine does not extend to derivative evidence discovered as a result of a defendant's voluntary statements obtained without Miranda warnings, the U.S. Supreme Court vacated Knapp I and remanded the case to the state supreme court for further consideration.

In a majority decision authored by Justice Butler, the supreme court concluded "that the fruit of the poisonous tree doctrine applies under the circumstances of this case under Article I, Section 8 of the Wisconsin Constitution. Where physical evidence is obtained as the direct result of an intentional Miranda violation, we conclude that our constitution requires that the evidence must be suppressed" (¶ 2).

The majority noted that it "arrive[d] at this conclusion guardedly, being mindful that the exclusionary rule is not absolute. In Knapp I, this court agreed that `because the physical fruits of a Miranda violation will be trustworthy evidence, it appears that in most cases the ... analysis boils down to a rule excluding the fruits of a Miranda violation only when there is a "strong need for deterrence."' That strong need for deterrence that overcomes the social costs of excluding evidence is present in this case for the same two policy reasons we identified in Knapp I" (¶ 74). First, the conduct at issue in this case was particularly repugnant and requires deterrence: the officer deliberately questioned the defendant without providing Miranda warnings - a tactic the officer later admitted was employed out of concern that the defendant, who tried to contact his attorney after the officer arrived at his house to arrest him, might not make a statement if he was provided with Miranda warnings (see ¶ 14). Second, under the circumstances present in this case, the "preservation of judicial integrity" requires that the physical evidence derived from the Miranda violation be suppressed (see ¶ 79).

Justice Crooks filed a concurring opinion strongly supporting the majority's decision, but he wrote separately "to emphasize that the majority opinion serves to reaffirm Wisconsin's position in the `new federalism' movement" (¶ 84). Chief Justice Abrahamson and Justices Bradley and Butler joined this concurrence.

Justice Wilcox filed a dissenting opinion "because the court has failed to adhere to the doctrine of stare decisis. This court has previously established that Article I, Section 8 of the Wisconsin Constitution does not create broader rights than those provided by the Fifth Amendment of the United States Constitution. Accordingly, I would affirm the order of the circuit court in conformity with the holding of United States v. Patane, 542 U.S. 630, 124 S. Ct. 2620 (2004)" (¶ 95). Justice Roggensack joined this dissent. Justice Prosser filed a separate dissent.

New Trial in Interest of Justice - Standards for New Trial on Basis of Newly Discovered Evidence

State v. Armstrong, 2005 WI 119 (filed 12 July 2005)

In 1981 the defendant was convicted of first-degree murder and first-degree sexual assault. In the present litigation, brought under Wis. Stat. section 974.06, he moved the circuit court to vacate his convictions. The circuit court denied the motion, and the court of appeals affirmed.

In a majority decision authored by Justice Butler, the supreme court reversed the court of appeals, concluding that at the original trial the real controversy had not been fully tried and therefore the convictions must be reversed in the interests of justice. The crucial issue in the underlying, factually complex case was the identification of the perpetrator of the crimes. However, the jury did not hear important DNA evidence (which surfaced years later) that bore on the issue of identification. At trial, the state assertively and repetitively presented physical evidence (hair and semen recovered at the scene) as affirmative proof of the defendant's guilt. The state's assertion was inconsistent with what the later DNA analysis revealed. "We agree with [the defendant] that the physical evidence now known to exclude [him] as the donor was used in a manner such that we cannot say with any degree of certainty that the real controversy has been fully tried" (¶ 109).

During this appeal both parties briefed the question of whether the defendant is entitled to a new trial because the DNA results constitute "newly discovered evidence." Because the court grounded its decision in the interests of justice, it declined to decide whether a new trial should be ordered because of newly discovered evidence. "Nevertheless, we take this opportunity to clarify the proper test for analyzing newly discovered evidence" (¶ 157). In a motion for a new trial on this basis, the defendant must prove, by clear and convincing evidence, that 1) the evidence was discovered after conviction; 2) the defendant was not negligent in seeking evidence; 3) the evidence is material to an issue in the case; and 4) the evidence is not merely cumulative. If the defendant proves these four criteria by clear and convincing evidence, the circuit court must determine whether a reasonable probability exists that a different result would be reached in a trial. See State v. McCallum, 208 Wis. 2d 463, 473, 561 N.W.2d 707 (1997). The court clarified that, with regard to the reasonable probability that a different result would be reached in a trial, the clear and convincing standard does not apply, and it withdrew language to the contrary in State v. Avery, 213 Wis. 2d 228, 234, 570 N.W.2d 573 (Ct. App. 1997). Said the court, "there need only be a reasonable probability that a different result would be reached in a trial. There are no gradations of a reasonable probability; either there is one, or there is not" (¶ 162).

Justice Roggensack filed a dissenting opinion that was joined by Justices Wilcox and Prosser.

Postconviction Motion Alleging Ineffective Assistance of Counsel and Newly Discovered Evidence - Evidentiary Hearing Ordered

State v. Love, 2005 WI 116 (filed 12 July 2005)

The defendant was convicted of armed robbery and given a lengthy prison sentence. He filed a pro se motion for postconviction relief under Wis. Stat. section 974.06 requesting a new trial on two grounds: newly discovered evidence and ineffective assistance of his postconviction counsel. As part of the newly discovered evidence claim, he included the affidavit of a person who claimed to have met another inmate while in prison who admitted robbing the victim. The ineffectiveness claim alleged that postconviction counsel should have challenged the effectiveness of trial counsel because of the latter's failure to investigate an exculpatory witness. The circuit court denied both motions without a hearing. The court of appeals affirmed.

In a majority opinion authored by Justice Butler, the supreme court reversed. To obtain a hearing on a postconviction motion, a defendant should include in the motion a historical basis setting forth material facts that allow the reviewing court to meaningfully assess the defendant's claims. See State v. Allen, 2004 WI 106, 274 Wis. 2d 568, 682 N.W.2d 433. The Allen court distinguished a merely conclusory allegation from an assertion of material fact, which the court defined as "[a] fact that is significant or essential to the issue or matter at hand." The Allen court proposed that a postconviction motion is sufficient if it alleges within the document's four corners "the five `w's' and one `h'; that is, who, what, where, when, why, and how." The Allen decision includes a model motion that would warrant an evidentiary hearing because it "contains sufficient material facts - i.e., the name of the witness (who), the reason the witness is important (why, how), and facts that can be proven (what, where, when)" (¶ 28, quoting Allen).

Relying on Allen the supreme court in this case concluded that the defendant's motion (which is quoted at length in ¶ 31) contains material facts that permit a court to meaningfully assess the merits of the ineffective assistance of counsel claim. Responding to the state's assertion that the motion fails to establish how the exculpatory witness knows what he claims to know, the court indicated that "a movant need not demonstrate theories of admissibility for every factual assertion he or she seeks to introduce. It is clear that [the defendant] asserts that [the exculpatory witness] has knowledge that can exculpate [the defendant]. Whether [the witness's] information is ultimately admissible, however, is not a matter to be decided from the face of the motion papers. Accepting the statements as true, which we must, the question is whether there are sufficient objective material factual assertions that would entitle [the defendant] to relief" (¶¶ 36-37). The court went on to conclude that the defendant's motion alleges sufficient material facts that, if true, would entitle him to relief.

With regard to the motion for a new trial on the basis of newly discovered evidence, the court concluded that the motion (which is quoted at length in ¶ 45) contains sufficient material facts to allow a reviewing court to meaningfully assess the claim and sets forth sufficient material facts entitling the defendant to a hearing on his claim.

"In sum, we conclude [the defendant] has presented sufficient material facts for a reviewing court to meaningfully assess his ineffective assistance of postconviction counsel and newly discovered evidence claims. Further, we conclude that [the defendant] is entitled to an evidentiary hearing on both claims. Although [the defendant's] motion does not allege sufficient facts that, on their face, would be admissible at the hearing, the motion papers allege sufficient material objective factual assertions that, if true, entitle him to relief. Therefore, we reverse the court of appeals' decision and remand this case to the circuit court for an evidentiary hearing" (¶ 56).

Justice Prosser filed a dissenting opinion that was joined by Justice Wilcox.

Child Sexual Abuse - Privilege

State v. Denis L.R., 2005 WI 110 (filed 8 July 2005)

A 3-year-old girl told a family therapist that her grandfather, Denis R., had sexually assaulted her. The clinic director reported the sexual abuse and Denis was charged with the offense. The girl's mother filed this appeal, which challenged the court's finding that the mother waived the therapist-patient privilege by voluntarily disclosing a significant part of the matter. The court of appeals affirmed.

The supreme court, in an opinion written by Justice Butler, affirmed and remanded for further proceedings. Although the appeal raised a number of waiver issues, the court held that the clinic director was compelled to report the suspected abuse by Wis. Stat. section 48.891, which in turn "extinguishe[d] [the girl's] privilege under Wis. Stat. (Rule) § 905.04(4)(e)2." (¶ 7). First, the girl was "examined" within the meaning of this section (see ¶ 44). Second, "there was a reasonable ground for an opinion of one of the enumerated providers in Wis. Stat. (Rule) § 905.04(4)(e)2. that [the girl] had been abused or neglected and that the abuse or neglect was by means other than accident or infliction by another" (¶ 46). Such "enumerated providers" are legally mandated to report suspected abuse to law enforcement. Because any communications about sexual abuse were not covered by the privilege, there was no need for an in camera review of anything the girl may have said to the counselor who treated her. (In a footnote, the supreme court addressed the status of otherwise confidential health care records.)

Postconviction Remedies - DNA Testing

State v. Moran, 2005 WI 115 (filed 12 July 2005)

Moran was charged with several criminal counts based on an incident in which he attacked another man with a knife. Moran represented himself at trial. Moran contended that the victim had attacked him first and referred several times in his argument to a "bloody brick." The jury convicted him. Moran later appealed his convictions, still proceeding pro se. This case involves Moran's request that DNA testing on the brick be conducted, pursuant to Wis. Stat. section 974.07.

The supreme court, in an opinion authored by Justice Prosser, held as follows: "The plain language of § 974.07(6) gives a movant the right to conduct DNA testing of physical evidence that is in the actual or constructive possession of a government agency and that contains biological material or on which there is biological material, if the movant meets several statutory prerequisites. First, the movant must show that the evidence meets the conditions under Wis. Stat. § 974.07(2). Second, the movant must comply with all reasonable conditions imposed by the court to protect the integrity of the evidence. Third, the movant must conduct any testing of the evidence at his or her own expense. If a movant seeks DNA testing at public expense, the movant must proceed under § 974.07(7)(a) or (b), and satisfy the heightened requirements in subsection (7)" (¶ 3).

The court remanded the matter for proceedings consistent with this holding. On remand, Moran will bear the burden of showing that the test results are relevant to his conviction or sentence. Allowing the DNA testing does not, in short, "guarantee that he will get a new trial, or even an evidentiary hearing" (¶ 47). "The harsh reality of life is that some persons who have been convicted of crime may have the means to hire attorneys or investigators post-conviction under circumstances that would never justify the expenditure of public money. The court is being asked in this case to prevent a person from conducting DNA testing at his own expense. We are unable to discern from the plain language of § 974.07 a clear legislative intent to block testing demanded by a person willing and able to pay until that person satisfies the requirements for publicly funded DNA testing. We encourage the legislature to revisit Wis. Stat. § 974.07 to define undefined terms, set limits to the evidence that must be provided, and give courts clear guidelines in procedure" (¶ 56).

Justice Wilcox, joined by Justice Roggensack, concurred but strongly urged the legislature "to take a hard look at the practical consequences" of the DNA-testing statute (see ¶59).

Guardianships

Interstate Transfer of Guardianships - National Probate Court Standards Adopted - Constitutionality of Wis. Stat. section 55.06(3)(c)

Grant County Dep't of Social Servs. v. Unified Bd. of Grant & Iowa Counties, 2005 WI 106 (filed 7 July 2005)

Jane E.P. resides at a nursing home in Illinois pursuant to an order of an Illinois court. Some of Jane's relatives, who live in Grant County, Wisconsin, want to move Jane to a nursing home in Grant County. The Grant County Department of Social Services petitioned to be made guardian of Jane and for her protective placement at a local nursing home. The circuit court ordered the Unified Board of Grant and Iowa Counties to make a comprehensive evaluation of Jane. Instead, the board moved to dismiss the guardianship and protective placement petition on the ground that the court lacked competency to proceed. The board argued that Jane is a resident of Illinois and that Wis. Stat. section 55.06(3)(c) requires her to be a Wisconsin resident at the time the petition is filed. The circuit court agreed with the board and dismissed the matter based on Jane's nonresidency. The court of appeals reversed the circuit court, holding that section 55.06(3)(c), as applied to Jane, violated her constitutional right to interstate travel. See 2004 WI App 153, ¶22, 275 Wis. 2d 680, 687 N.W.2d 72.

In a decision authored by Justice Bradley, the supreme court vacated the decision of the court of appeals and remanded the case for the circuit court to consider the petition again in light of certain standards adopted by the court in this opinion. The court began its analysis by observing that "the problem in this case and others like it is that current laws are generally insufficient to assist courts and litigants in resolving multi-jurisdictional issues stemming from interstate guardianships. ... We strongly encourage the legislature to address this issue. In facilitating this end, we direct its attention to the work of both the National College of Probate Judges and the National Conference of Commissioners on Uniform State Laws referenced later in this opinion. However, in the absence of legislative guidance, we set forth standards for Wisconsin courts to follow when confronting cases associated with the interstate transfer of guardianships" (¶¶ 27-28).

The court adopted the following National Probate Court Standards: Standard 3.5.1 (Communication and Cooperation Between Courts), 3.5.3 (Transfer of Guardianship), 3.5.4 (Receipt and Acceptance of a Transferred Guardianship), and 3.5.5 (Initial Hearing in the Court Accepting the Transferred Guardianship). (In a footnote, the court also referenced Standard 3.5.2, which pertains to the recommended screening and review process of a petition for guardianship. Though not the focus of this case, the court nonetheless quoted this standard "for guidance in future cases" (see ¶ 36 n.15).) After describing each of these standards and the official commentary accompanying them, the court concluded by recognizing that "the standards will not solve every problem associated with interstate guardianships. However, in the spirit of comity and to promote the orderly administration of justice, they are to be employed for the interstate transfer of guardianships. These standards will help Wisconsin courts facilitate the geographic mobility of those individuals that guardianship orders were designed to protect" (¶ 46).

The constitutionality of section 55.06(3)(c), which requires that the petition be filed in the county of residence of the person to be protected, was addressed by Justice Crooks in a concurring opinion that garnered the support of a majority of the justices. The majority concluded that the statute is "rationally related to protecting and preserving the county's and the State's ability to provide services to its own bona fide residents in preference to those persons who reside in other states" (¶ 57).

Justice Roggensack filed an opinion concurring in part with and dissenting in part from the majority's opinion. She concluded that the statute is constitutional but also that the circuit court's order dismissing the petition for guardianship should be affirmed.

Jury Trial

Civil Forfeiture Traffic Offenses - Right to Trial by Jury in Circuit Court

Dane County v. McGrew, 2005 WI 130 (filed 19 July 2005)

The defendant was charged with speeding. He sought trial by a jury of 12, arguing that he was entitled to a 12-person jury under article I, section 5 of the Wisconsin Constitution and that the provision of Wis. Stat. section 345.43 for six-person juries in traffic forfeiture cases that are tried in circuit court is therefore unconstitutional. The circuit court denied the defendant's request for a 12-person jury. Following trial before a jury of six, the defendant was convicted. The court of appeals affirmed.

Writing the lead opinion for three justices of the supreme court, Justice Prosser concluded that the defendant "has not satisfied the heavy burden of showing that Wis. Stat. § 345.43 is unconstitutional. Because he cannot show that the cause of action for a speeding violation existed at the time the Wisconsin Constitution was enacted, he has no constitutional right to a trial by a jury of 12. As such a right is not constitutionally mandated, the legislature is free to fix the number of jurors at six, as it has done" (¶ 51) (citation omitted).

However, in a footnote, the court acknowledged that "the four concurring and dissenting justices, although split on the number of jurors to which [the defendant] is entitled, conclude that [the defendant] has a constitutional right to a jury trial and form a majority on that issue" (¶ 3 n.2). The concurring opinion of Justice Bradley, joined by Chief Justice Abrahamson and Justice Crooks, concluded that the defendant has a state constitutional right to a jury trial before six jurors (see ¶ 52). In dissent Justice Butler contended that the defendant has a state constitutional right to a jury of 12 (see ¶ 72). As characterized by Justice Bradley, her concurrence together with the dissent of Justice Butler "form a majority on the constitutional issue that such a right exists and, at a minimum, it is to a six-person jury" (¶ 70 n.28). In a footnote, Justice Bradley further clarified that "this decision is not to be read, however, that there is a constitutional right to a six-person jury trial in municipal court. Rather, the right is exercised when upon appeal there is a jury trial in circuit court. See Ogden v. City of Madison, 111 Wis. 413, 87 N.W. 568 (1901) (the constitutional right to trial by jury does not extend to a prosecution for a violation of a city ordinance in municipal court)" (¶ 70 n.28).

Open Records Law

Request for Personally Identifiable Information under Wis. Stat. section 19.35(1)(am) - General Requests for Records under Wis. Stat. section 19.35(1)(a)

Hempel v. City of Baraboo, 2005 WI 120 (filed 13 July 2005)

This case involved open records law requests filed by a city of Baraboo police officer (the plaintiff) for documents generated during an internal department investigation of sexual harassment that he allegedly committed. He claimed a right to inspect the records under both Wis. Stat. section 19.35(1)(a), which provides that "[e]xcept as otherwise provided by law, any requester has a right to inspect any record," and section 19.35(1)(am), which provides that "any requester who is an individual ... has a right to inspect any record containing personally identifiable information pertaining to the individual," with certain statutory exceptions. Although a substantial amount of information (some in redacted form) had been turned over to the plaintiff, he filed this complaint after the police chief denied his request for any documents related to the department's internal investigation and for some of the redacted information in documents already provided to him. The circuit court granted summary judgment to the city and its police department. The court of appeals affirmed. In a majority decision authored by Justice Prosser, the supreme court affirmed the court of appeals.

The first issue addressed by the supreme court was whether section 19.35(1)(am) gives a police officer the personal right to inspect records compiled by a police department in its internal investigation of a sexual harassment complaint against the officer. The court concluded that "when a person makes an open records request for records containing personally identifiable information under Wis. Stat. § 19.35(1)(am), the person is entitled to inspect the records unless the surrounding factual circumstances reasonably fall within one or more of the statutory exceptions to paragraph (am)" (¶ 3). In this case the court held that the plaintiff was the subject of an investigation "in connection with a complaint," which is one of the express statutory exceptions. "The internal investigation records were maintained in connection with that complaint and are being held for possible use in connection with any future complaint. Disclosure of the records would also expose the names and statements of informants who were promised confidentiality for their cooperation in the internal investigation" (¶ 57). Thus, the plaintiff was not entitled to the additional information he sought. (The court noted that, if a statutory exception to section 19.35(1)(am) is present in a case, the request for information may be denied without any requirement that the custodian balance interests (see ¶ 27).)

The second question before the court was whether section 19.35(1)(a) gives the public, including the police officer, a right to inspect a police department's records of an internal sexual harassment investigation and unredacted copies of related documents under the following circumstances: the department does not bring disciplinary charges against the officer; the department articulates several specific concerns about the confidentiality and privacy of cooperating witnesses and its ability to conduct future internal investigations; and the department releases redacted records that preserve witness confidentiality but expose the nature of the harassment complaint.

The court summarized the process a custodian must follow in responding to a general open records request under section 19.35(1)(a): "Keeping in mind the strong legislative presumption favoring disclosure, [the records custodian] must determine whether the requested records are subject to an exception that may or will prevent disclosure. Two general types of exceptions may apply: statutory exceptions and common law exceptions. If neither a statute nor common law creates a blanket exception, the custodian must decide whether the strong presumption favoring access and disclosure is overcome by some even stronger public policy favoring limited access or nondisclosure" (¶ 4) (citations omitted).

In this case, because no blanket exception to disclosure existed, the court proceeded to consider the balancing a records custodian must perform when considering an open records request under section 19.35(1)(a). "[T]he custodian must consider `all the relevant factors' to determine `whether permitting inspection would result in harm to the public interest which outweighs the legislative policy recognizing the public interest in allowing inspection.' In other words, the custodian must determine whether the surrounding factual circumstances create an `exceptional case' not governed by the strong presumption of openness. Although our prior cases have not expressly defined `exceptional case,' we conclude that an `exceptional case' under paragraph (a) exists when the facts are such that the public policy interests favoring nondisclosure outweigh the public policy interests favoring disclosure, notwithstanding the strong presumption favoring disclosure" (¶ 63) (citations omitted).

Applying the "exceptional case" public policy balancing test, the court concluded that the public's interest in keeping these records confidential outweighed the presumptive public interest in disclosure. Among the many factors at issue were the previous release of the redacted documents, the police department's concern that future complainants and witnesses will be less likely to make candid statements (especially in sexual harassment cases) if they know that the accused may access their statements through an open records request, the police department's fear that morale may be diminished if officers believe that their personnel files are readily available to the public, the department's concern that future recruiting could be harmed by a perception that personnel files are regularly open for public review, and the department's fear that some of the information that would be released might be factually inaccurate and cause damage to the subject's reputation.

Chief Justice Abrahamson filed a dissenting opinion that was joined by Justices Bradley and Butler.

Public Works Projects

Bidding on Public Works Projects - Remedial Mechanism for Dealing with Bidder Errors

James Cape & Sons v. Mulcahy, 2005 WI 128 (filed 15 July 2005)

James Cape & Sons Co. (Cape) submitted a bid for a highway project. After the bids were opened, Cape realized that it had neglected to incorporate a last-minute change from a subcontractor into its bid. It sought to amend the bid or, failing that, to withdraw the bid and recover its $100,000 proposal guaranty (bid bond). The Wisconsin Department of Transportation (DOT) did not allow Cape relief from the bid mistake, awarded Cape the contract, and when Cape refused to perform, retained Cape's bid bond. Cape filed suit to recover its bid bond. The circuit court granted summary judgment in favor of Cape. The court of appeals affirmed. See 2003 WI App 229. In a unanimous decision authored by Justice Prosser, the supreme court affirmed the court of appeals.

Wis. Stat. section 66.0901 governs the process for bidding on public works projects. Section 66.0901(5), which provides the remedial mechanism for dealing with bidder errors, provides as follows: "If a bidder makes an error, omission or mistake and discovers it after the bids are opened, the bidder shall immediately and without delay give written notice and make known the fact of the mistake, omission or error which has been committed and submit to the municipality clear and satisfactory evidence of the mistake, omission or error and that it was not caused by any careless act or omission on the bidder's part in the exercise of ordinary care in examining the plans or specifications and in conforming with the provisions of this section. If the discovery and notice of a mistake, omission or error causes a forfeiture, the bidder may not recover the moneys or certified check forfeited as liquidated damages unless it is proven before a court of competent jurisdiction in an action brought for the recovery of the amount forfeited, that in making the mistake, error or omission the bidder was free from carelessness, negligence or inexcusable neglect."

Applying this statute the supreme court first concluded that "[t]he plain language of § 66.0901(5) does not contemplate bid amendment [after the bids are opened], and as a result we must conclude that municipalities [including the state] do not have the authority to permit a bidder to amend its bid. Thus, the only relief available to a bidder that acknowledges a mistake, error, or omission in its bid is to request that its bid be withdrawn from consideration" (¶ 46).

The next matter addressed by the court was bid withdrawal. Cape had asked to withdraw its bid if it could not correct the bid. The DOT refused this request, conditioning withdrawal on Cape's forfeiture of the bid bond. The court concluded that section 66.0901(5) is a modified codification of the equitable rescission doctrine. The limitations to the doctrine imposed by the statute are that "(1) a bidder who withdraws may not correct the bid or (2) a bidder who asks to withdraw after the bids are opened but before the contract is awarded must show that the bidder has met all the conditions set out [in the first sentence of the portion of the statute quoted above]. That is, a bidder must prove by clear and satisfactory evidence that the error was not caused `by any careless act or omission on the bidder's part in the exercise of ordinary care in examining the plans and specifications and in conforming with the provisions of this section.' The language of the statute normally permits a bidder to withdraw if the bidder satisfies the conditions in the [first sentence in the portion of the statute quoted above], but a fair-minded, even-handed municipality is not an impotent municipality. A municipality is entitled to go forward to award the contract and trigger forfeiture of the bid bond if the bidder has not satisfied the conditions for withdrawal, if the bidder is not acting in complete good faith, or if the municipality can show that it has been prejudiced by the bidder's error" (¶¶ 60-61).

Lastly, the court considered the forfeiture of bid bonds. "[Section] 66.0901(5) creates a cause of action for a bidder to recover a forfeited bid bond where the public works contract is awarded but not performed. In a cause of action to recover a proposal guaranty, the circuit court employs a de novo standard of review, and may take additional evidence in determining whether the bidder is free of carelessness, negligence, or inexcusable neglect and thus entitled to the return of the bond" (¶ 5). (Editors' Note: Attorneys practicing in this area of the law should carefully review paragraphs 69 and 70 of this decision, in which the supreme court laid out the analytical steps a court should follow when conducting a review under section 66.0901(5).)

In this case the supreme court concluded that the DOT operated under an incorrect theory of law when it failed to properly consider Cape's timely request to withdraw its bid without forfeiting its bid bond. In the judicial hearing to recover the bond, Cape satisfied all of the requirements for bid withdrawal and the circuit court held that Cape was free from negligence. The supreme court declined to upset the circuit court's finding. Accordingly, the supreme court affirmed the court of appeals' decision upholding summary judgment in favor of Cape.

Torts

Lead Paint Litigation - Application of Risk-Contribution Theory

Thomas v. Mallett, 2005 WI 129 (filed 15 July 2005)

The plaintiff claimed that he sustained injuries from lead poisoning by ingesting lead paint from accessible painted surfaces, paint chips, paint flakes, and dust at homes he lived in as a child. The defendants (or their predecessors-in-interest) are pigment manufacturers. Pigment is one of two major components in paint, and the predominant lead pigment that was manufactured and integrated into paint was white lead carbonate. All of the defendant pigment manufacturers (or their predecessors-in-interest) produced this pigment at various times since the early 1900s, when the houses in which the plaintiff lived were built. The plaintiff, who alleged that he was injured by white lead carbonate pigment, has been unable to identify the precise producer of the white lead carbonate pigment he ingested at his prior residences due to the generic nature of the pigment, the number of producers, the lack of pertinent records, and the passage of time.

In his suit against the pigment manufacturers, the plaintiff alleged that they are liable on the basis of, among other things, strict liability, negligence, conspiracy, and enterprise liability. The circuit court granted summary judgment in favor of the defendants. In a published decision the court of appeals affirmed. See 2004 WI App 131. The appellate court concluded that because the plaintiff had a remedy against his landlords for their negligence in failing to abate lead paint hazards in his prior residences, there was no reason to extend risk-contribution theory (described below) to his case. The court of appeals also concluded that the plaintiff could not proceed on his claims of civil conspiracy and enterprise liability. In a majority decision authored by Justice Butler, the supreme court affirmed in part and reversed in part.

The plaintiff argued that the court of appeals' decision should be reversed because "(1) although he received a remedy from his landlords for their negligence, Article I, Section 9 of the Wisconsin Constitution does not foreclose his seeking a remedy for the Pigment Manufacturers' separate wrong for producing and promoting toxic lead pigments; (2) risk-contribution theory [as developed in Collins v. Eli Lilly Co., 116 Wis. 2d 166, 342 N.W.2d 37 (1984)] should be recognized for white lead carbonate claims; and (3) he has presented sufficient material facts to warrant a trial on his alternative theories of liability of civil conspiracy and enterprise liability" (¶ 2).

The majority agreed with the plaintiff that article I, section 9 does not insulate wrongdoers from liability simply because recovery has been obtained from an altogether different wrongdoer for an altogether different wrong. This section of the state constitution provides as follows: "Every person is entitled to a certain remedy in the laws for all injuries, or wrongs which he may receive in his person, property, or character; he ought to obtain justice freely, and without being obligated to purchase it, completely and without denial, promptly and without delay, conformably to the laws."

The majority also concluded that the white lead carbonate claims at issue in this case are factually similar enough to the claims in Collins to warrant extension of the risk-contribution theory. The Collins plaintiff claimed that, while she was in utero, her mother used diethylstilbestrol (DES) to prevent miscarriage and that this caused the plaintiff to develop adenocarcinoma of the vagina and other problems almost 20 years later. The plaintiff's mother could not remember where she purchased the DES or who manufactured it. The plaintiff sued 12 drug companies, all of which produced or marketed DES; however, she could not identify the precise producer or marketer of the DES taken by her mother due to the generic status of some DES, the number of producers or marketers, the lack of pertinent records, and the passage of time. The Collins court was thus faced with a choice of either fashioning a method of recovery for the DES case that would deviate from traditional notions of tort law or permitting possibly negligent defendants to escape liability for injury of an innocent plaintiff. "In the interests of justice and fundamental fairness," the Collins court chose the former, observing that article I, section 9 of the Wisconsin Constitution conferred on the court the ability to create an adequate remedy when one did not exist (see ¶¶ 102-03).

Accordingly, the Collins court adopted the risk-contribution theory, which relaxed the plaintiff's burden of proof in establishing causation in her negligence and product liability claims. It did so for three reasons. "First, `[e]ach defendant contributed to the risk of injury to the public and, consequently, the risk of injury to individual plaintiffs. ...' In this sense, each shared some measure of culpability in producing or marketing the drug. Second, because the drug companies were in a better position to absorb the cost of the injury (through either insurance, incorporation of the damage awards, or by passing the cost along to the public as `a cost of doing business,') this court concluded that `it is better to have drug companies or consumers share the cost of the injury than to place the burden solely on the innocent plaintiff.' Third, the court recognized that `the cost of damages awards will act as an incentive for drug companies to test adequately the drugs they place on the market for general medical use'" (¶ 104) (citations omitted).

Having concluded that the white lead carbonate claims in this case are similar enough to Collins to warrant extension of the risk-contribution theory, the majority proceeded to lay out what the plaintiff must prove at trial. Regarding his negligence claim he will have to prove the following elements: "(1) that he ingested white lead carbonate; (2) that the white lead carbonate caused his injuries; (3) that the Pigment Manufacturers produced or marketed the type of white lead carbonate he ingested; and (4) that the Pigment Manufacturers' conduct in producing or marketing the white lead carbonate constituted a breach of a legally recognized duty to [the plaintiff]. Because [the plaintiff] cannot prove the specific type of white lead carbonate he ingested, he need only prove that the Pigment Manufacturers produced or marketed white lead carbonate for use during the relevant time period: the duration of the houses' existence" (¶ 161).

The plaintiff will have to prove the following elements to the satisfaction of the trier of fact to prevail on his strict products liability claim: "(1) that the white lead carbonate was defective when it left the possession or control of the pigment manufacturers; (2) that it was unreasonably dangerous to the user or consumer; (3) that the defect was a cause of [the plaintiff's] injuries or damages; (4) that the pigment manufacturer engaged in the business of producing or marketing white lead carbonate or, put negatively, that this is not an isolated or infrequent transaction not related to the principal business of the pigment manufacturer; and, (5) that the product was one which the company expected to reach the user or consumer without substantial change in the condition it was when sold" (¶ 162).

"Once [the plaintiff] makes a prima facie case under either claim, the burden of proof shifts to each defendant to prove by a preponderance of the evidence that it did not produce or market white lead carbonate either during the relevant time period or in the geographical market where the house is located. However, if relevant records do not exist that can substantiate either defense, `we believe that the equities of [white lead carbonate] cases favor placing the consequences on the [pigment manufacturers].' In addition to these specific defenses, and unlike in the DES cases, the Pigment Manufacturers here may have ample grounds to attack and eviscerate [the plaintiff's] prima facie case, with some of those grounds including that lead poisoning could stem from any number of substances (since lead itself is ubiquitous) and that it is difficult to know whether [the plaintiff's] injuries stem from lead poisoning as they are not signature injuries" (¶ 163) (citations omitted).

Lastly, the majority concluded that the plaintiff did not present sufficient material facts to warrant a trial on his civil conspiracy and enterprise liability claims.

Justice Wilcox filed a dissent that was joined by Justice Prosser. Justice Prosser filed a dissent that was joined by Justice Wilcox. Justice Roggensack did not participate in this case.

Economic Loss Doctrine - Damage to "Other Property"

Grams v. Milk Prods. Inc., 2005 WI 112 (filed 8 July 2005)

The plaintiffs specialize in raising calves. For the first few weeks of their lives, the calves are fed a milk substitute or "milk replacer." The plaintiffs used replacer products purchased from Cargill, Inc. and manufactured by Milk Products, Inc. Initially the plaintiffs used a replacer that included medications. They later switched to a less expensive replacer without medication. After making the switch, they noticed that their calves were not gaining weight properly, appeared gaunt and hungry, and experienced a much higher mortality rate. The plaintiffs filed suit against Cargill and Milk Products, alleging four tort causes of action and one contract cause of action.

The circuit court granted summary judgment in favor of the defendants on all four tort claims, finding that those claims were barred by the economic loss doctrine. It also granted summary judgment in favor of Milk Products on the contract claim because there was no privity between the plaintiffs and Milk Products, and it dismissed Milk Products from the case. This left only the plaintiffs' contract claim against Cargill. The court of appeals affirmed. The supreme court granted review to determine whether the plaintiffs' tort claims are barred by the economic loss doctrine. In a majority decision authored by Justice Prosser, the supreme court affirmed.

The court began its analysis with an overview of the economic loss doctrine. "The economic loss doctrine is a judicial doctrine intended to preserve the fundamental distinction between contract and tort. It works to prevent a party to a contract from employing tort remedies to compensate the party for purely economic losses arising from the contract. There are exceptions. For instance, we noted several years ago that `[t]he economic loss doctrine does not preclude a product purchaser's claims of personal injury or damage to property other than the product itself.' Over time, however, the parameters of this `other property' exception have proved elusive. In this case, we must decide whether the [plaintiffs'] claimed damages fall within the scope of the `other property' exception" (¶ 2) (citations omitted).

The court held that "if claimed damages are the result of disappointed expectations of a bargained-for product's performance, the economic loss doctrine applies to bar the plaintiff's tort claims and the plaintiff must rely upon contractual remedies alone. In this case, the [plaintiffs] allege in tort that the object of the contract, a `milk replacer' intended for livestock nourishment, did not adequately nourish their calves and that some died. Because we find that this tort claim is, at bottom, based on disappointed performance expectations, we hold that it does not fit within the `other property' exception and is therefore barred by the economic loss doctrine" (¶ 3).

Chief Justice Abrahamson filed a dissent that was joined by Justice Butler. Justice Bradley withdrew from participation in this case.

Intentional Misrepresentation in Commercial Transactions - Economic Loss Doctrine

Kaloti Enters. Inc. v. Kellogg Sales Co., 2005 WI 111 (filed 8 July 2005)

Kaloti, a food products wholesaler, had a longstanding practice of purchasing Kellogg's products through Kellogg's agent for resale to large stores. The plaintiff alleged that Kellogg decided to begin selling these products directly to the same stores and did not inform the plaintiff of this decision. Kellogg's agent then solicited from the plaintiff a large order, which was delivered and paid for. The plaintiff later was notified by the large stores that they would no longer purchase Kellogg's products from the plaintiff because Kellogg was selling directly to them. The plaintiff attempted to return the product, but Kellogg refused to accept delivery and refused to reimburse the plaintiff. The plaintiff sued Kellogg and the agent for intentional misrepresentation (sometimes referred to as fraudulent misrepresentation).

The circuit court dismissed the plaintiff's complaint. The court of appeals certified the case to the supreme court, identifying the following questions for consideration: 1) whether a duty to disclose facts arises between sophisticated parties to a commercial transaction when the parties have an established practice of doing business and the facts are material to a change in that practice of doing business; and 2) whether the plaintiff's intentional misrepresentation claim is barred by the economic loss doctrine (see ¶ 1).

In a majority decision authored by Justice Roggensack, the supreme court reversed. The court stated that the following allegations must be made to state a claim for intentional misrepresentation: "(1) the defendant made a factual representation; (2) which was untrue; (3) the defendant either made the representation knowing it was untrue or made it recklessly without caring whether it was true or false; (4) the defendant made the representation with intent to defraud and to induce another to act upon it; and (5) the plaintiff believed the statement to be true and relied on it to his/her detriment. An intentional misrepresentation claim may arise either from a `failure to disclose a material fact' or from a `statement of a material fact which is untrue.' Here, [the plaintiff's] intentional misrepresentation claim is based on the failure to disclose a material fact. However, `[a] person in a business deal must be under a duty to disclose a material fact before he can be charged with a failure to disclose.' When there is a duty to disclose a fact, the law has treated the failure to disclose that fact `as equivalent to a representation of the nonexistence of the fact.' Whether [the defendants] had a duty to disclose is the only aspect of [the plaintiff's] intentional misrepresentation claim that is at issue here" (¶¶ 12-14) (citations omitted).

"The usual rule is that there is no duty to disclose in an arm's-length transaction. However, courts have carved out a number of exceptions to that rule and have refused to apply the rule when to do so would work an injustice" (¶ 15). In this case the supreme court concluded that "a party to a business transaction has a duty to disclose a fact where: (1) the fact is material to the transaction; (2) the party with knowledge of that fact knows that the other party is about to enter into the transaction under a mistake as to the fact; (3) the fact is peculiarly and exclusively within the knowledge of one party, and the mistaken party could not reasonably be expected to discover it; and (4) on account of the objective circumstances, the mistaken party would reasonably expect disclosure of the fact" (¶ 20). Applying these principles the court concluded that the allegations in the plaintiff's amended complaint satisfy statutory pleading requirements and are sufficient, if proved at trial, to establish that the defendants each had a duty of disclosure.

The defendants also argued that the economic loss doctrine bars the plaintiff's intentional misrepresentation claim. In general this doctrine precludes contracting parties from pursuing tort recovery for purely economic or commercial losses associated with the contract relationship. Wisconsin courts have recognized that the economic loss doctrine bars misrepresentation claims based in negligence and strict responsibility. However, before this case, they had not decided whether and to what extent the economic loss doctrine bars claims for fraud in the inducement.

The supreme court concluded that "a fraud in the inducement claim is not barred by the economic loss doctrine 'where the fraud is extraneous to, rather than interwoven with, the contract.' To invoke this narrow fraud in the inducement exception where, as here, the failure of a party to a business transaction to disclose a fact serves as the basis for a fraudulent inducement to contract claim, a plaintiff must show that: (1) there was an intentional misrepresentation, the five elements of which are set out above; (2) the misrepresentation occurred before the contract was formed; and (3) `the fraud [was] extraneous to, rather than interwoven with, the contract.' Or stated another way, the fraud concerns matters whose risk and responsibility did not relate to the quality or the characteristics of the goods for which the parties contracted or otherwise involved performance of the contract" (¶ 42). Applying this standard to the present case, the court concluded that the economic loss doctrine does not bar the plaintiff's claim for intentional misrepresentation.

Chief Justice Abrahamson filed a concurring opinion that was joined by Justices Bradley and Butler.

Economic Loss Doctrine - Homeowners

Linden v. Cascade Stone Co., 2005 WI 113 (filed 8 July 2005)

The Lindens sued their general contractor, Groveland, and various subcontractors, including Cascade and Fern, for alleged "faulty workmanship" in the construction of their home. The circuit court dismissed negligence claims against Cascade and Fern on the ground that the economic loss doctrine precluded the claims. The court of appeals affirmed.

The supreme court, in a decision authored by Justice Roggensack, affirmed. The court addressed three issues. First, the court considered "whether a general contract to complete a described project, whereunder the general contractor subcontracts with others to assist in completing the project and a claim is made for negligent services provided by the subcontractors, controls the analysis of whether the contract is primarily for goods or primarily for services" (¶ 4). "Cascade and Fern argue that examining the service subcontracts rather than the Lindens' contract with the general contractor, Groveland, would allow the Lindens to make an end run around the contract for which Groveland and the Lindens bargained. We agree. Focusing on the contract for which the purchaser bargained maintains the distinction between tort and contract for the purchaser who is in the best position to bargain for coverage of the risk of faulty workmanship in any part of the house. The Lindens did exactly that here. They had contractual remedies against Groveland, who in turn had its own remedies against the subcontractors. ... Allowing the Lindens to maintain a tort claim against the subcontractors for services rendered to the general contractor would undermine the distinction between contract law and tort law that the economic loss doctrine seeks to preserve. We also conclude that allowing the Lindens to maintain a tort action against the subcontractors harms the Lindens' and Groveland's freedom of contract, because permitting the Lindens to maintain a tort claim would get around the warranties and remedies they had already bargained for with Groveland. Because we conclude that according the general contract control over this transaction better meets the policies underlying the economic loss doctrine, we apply the predominant purpose test to the contract between the Lindens and Groveland" (¶ 17).

Second, the court held that although the Lindens made "good arguments" in favor of a "quantitatively objective test when determining" a contract's predominant purpose, "the totality of the circumstances test, which includes both quantitatively objective and subjective factors, should be applied to determine the predominant purpose of a contract" (¶ 18). In applying the test, the court concluded that "the predominant purpose of the contract was for a product, a new house, rather than one for services" (¶ 25).

Third, the court held that "the `integrated systems limitation' of the `other property exception' to the economic loss doctrine applies to bar a negligence claim against a subcontractor who provided services in the construction of a house" (¶ 26). "The stucco and roof shingling have no independent value or use apart from their function as components of the home. The Lindens bargained for the finished product, a house; not its various components" (¶ 28). "Because the damage caused by the defective stucco and roof shingling harmed only other components of the house, we conclude the integrated systems exception applies, and the Lindens are therefore barred from seeking tort remedies from the subcontractors" (¶ 28).

Justice Bradley, in a dissent joined by Chief Justice Abrahamson and Justice Butler, argued that this decision "frustrates" homeowners who seek recourse against subcontractors because the homeowners may bring neither tort claims nor contract claims and because the decision unduly extends the reach of the economic loss doctrine (see ¶ 35).

Repose Period - Real Property Improvements - Constitutionality of Wis. Stat. section 893.89

Kohn v. Darlington Cmty. Schs., 2005 WI 99 (filed 1 July 2005)

While attending a high school football game with her parents, a 4-year old girl fell 15 feet through the bleachers and was injured. The bleachers had been standing on the site since 1969. The girl and her parents sued various defendants, including the school district and ITW, which constructed the bleachers. ITW was granted summary judgment dismissing it from the case because the suit was filed after expiration of the 10-year statute of repose that governs claims stemming from improvements to real property. See Wis. Stat. § 893.89. The court of appeals reversed on the basis that the bleachers were not an improvement to real property because they were not "anchored" to the ground.

The supreme court, in an opinion written by Justice Wilcox, reversed the court of appeals. First, the supreme court held that the bleachers constituted an improvement to real property and hence fell within the statute of repose (§ 893.89). "The bleachers qualify as an `improvement to real property' because they are a permanent addition to Darlington's real property that enhance its capital value, involved the expenditure of labor and money, and were designed to make the property more useful or valuable" (¶ 33). Second, the statute of repose did not violate the "right to a remedy" provision found in article I, section 9 of the Wisconsin Constitution. The constitution simply did not permit the court to "second-guess the policy choices of the legislature" (¶ 43).

Third, section 893.89 did not violate equal protection guarantees under the state and federal constitutions. "In sum, § 893.89 protects all persons involved in the improvement to real property but does not protect individuals whose liability arises based on conduct occurring prior to or subsequent to the improvement. These distinctions are rational because they are real, substantial distinctions that are germane to the purpose of the statute - to protect those involved in the improvement of real property. This statute is distinguishable from its predecessors because, as noted, the current statute immunizes all conduct related to the improvement after a period of ten years. It does not cover liability-forming conduct unrelated to the act of improving property, such as manufacturing defects, for any amount of time. Stated another way, the statute protects all who are involved in the actual improvement of real property to the extent they participated in improving the property. The only time individuals involved in the improvement of real property are held liable (after ten years) under the statute is when their liability arises from conduct that preceded or followed the actual improvement" (¶ 68). Thus, "classifications within § 893.89 rationally serve the legitimate purpose of limiting the long-term liability of those who are involved in the improvement of real property. The distinctions drawn by the statute are based on real and substantial distinctions, are germane to the purpose of the law, are not based on existing circumstances only, apply equally to all the members of each respective class, and suggest the propriety of different legislation for each class" (¶ 80).

Fiduciaries - Trusts - Negligence

Hatleberg v. Norwest Bank Wis., 2005 WI 109 (filed 7 July 2005)

Norwest Bank, now Wells Fargo, acted as trustee of an irrevocable trust set up by Hatleberg's mother, Erickson. "In this case, during its tenure as trustee, Wells Fargo became aware of a defect in a trust that it had not drafted. It did not reveal that defect to the grantor, Erickson. After Erickson's death, the trust was subject to increased tax liability due to the drafting defect. Hatleberg sued Wells Fargo on behalf of Erickson's estate, alleging several theories of liability. The circuit court concluded that Wells Fargo breached a duty to Erickson, and the court of appeals affirmed" (¶ 2).

The supreme court, in an opinion written by Justice Prosser, affirmed, although on different grounds than those relied on by the court of appeals, and remanded for a determination of damages. "First, on the facts of this case, Wells Fargo had no duty to review the Erickson trust to ensure its effectiveness as an instrument to avoid estate taxes. The pertinent facts are that the trust instrument did not assign this responsibility to the trustee and the trustee did not draft the trust. Second, inasmuch as Erickson's estate suffered no physical harm, Wells Fargo was not subject to `Good Samaritan' liability under § 323 of the Restatement (Second) of Torts" (¶ 3).

The third and "definitive[]" issue, however, related to Wells Fargo's duty to avoid negligently providing information (see ¶ 33). "In this case, despite its knowledge of the problem with the trust, Wells Fargo assured Erickson that `she had nothing to worry about,' and that `for estate tax purposes, it makes sense to do the gifts'" (¶ 37). The court noted that Wisconsin has adopted section 552 of the Restatement (Second) of Torts. "We conclude that all the elements listed in § 552 are present here. Wells Fargo made false statements to Erickson by telling her that `for estate tax purposes, it makes sense to do the gifts' and that there were `no problems' with her trust after it knew of the Crummey problem. Wells Fargo made the statements in the course of its business. Wells Fargo intended to guide Erickson's business practices (`it makes sense to do the gifts'). Wells Fargo had a pecuniary interest in the transactions, as it received a fee for serving as the trustee. Erickson relied on Wells Fargo's statements and suffered pecuniary loss in the amount of more than $173,000 in taxes. Accordingly, Wells Fargo had - and breached - a duty under § 552. Similarly, we have no difficulty concluding that Wells Fargo's statements to Erickson are negligent misrepresentations under Wisconsin common law" (¶¶ 39-40). "As a matter of law, we conclude that, because Wells Fargo held itself out as an expert in managing Erickson's finances, it had a duty to avoid providing false information to its client. It breached that duty, and we therefore affirm the court of appeals" (¶ 42).

Medical Negligence - Screening Exams

Preston v. Meriter Hosp. Inc., 2005 WI 122 (filed 13 July 2005)

Preston was 23 weeks pregnant when she went into labor. She went to a hospital, where some hours later she gave birth to a son (Bridon), who weighed just 700 grams. The staff allegedly made no attempt to prolong the child's life, and Bridon died several hours later. Preston sued the hospital for a variety of claims, but the circuit court granted summary judgment in the hospital's favor. The court of appeals affirmed.

Preston sought review of the dismissal of one claim that she brought under the Emergency Medical Treatment and Active Labor Act (EMTALA), in which she alleged that the hospital violated the EMTALA, specifically 42 U.S.C. § 1395dd(a), by not providing an appropriate medical screening examination. The supreme court, in an opinion written by Justice Prosser, reversed. The court framed the narrow issue as follows: "[W]hether the EMTALA screening requirement applies to an infant born in a hospital birthing center. Specifically, we must interpret whether the statutory phrase `comes to the emergency department' requires a baby to be born in a hospital emergency room for the EMTALA screening requirement to apply" (¶ 2).

Putting to one side the defendant's argument that Preston had waived the issue (see ¶ 17), the court turned to legislative history and extant regulations to clarify the ambiguity in the phrase "comes to the emergency department." (see ¶¶ 23-26). It concluded "that the proper interpretation of `comes to the emergency department' in this case imposes a duty upon a hospital to provide a medical screening examination to a newborn who (1) presents to the emergency room of the hospital or (2) is born in the birthing center of the hospital and otherwise meets the conditions set forth in 42 C.F.R. § 489.24(b) (1999)" (¶ 38). Finally, the majority repeatedly stressed that it resolved this issue on the pleadings and that it concluded only that the complaint states a claim for which relief may be granted. Thus it did not reach the summary judgment record.

Justice Crooks concurred and wrote separately to address the dissent's discussion of whether Bridon was an "inpatient" for EMTALA purposes, an issue not addressed by the majority.

Justice Roggensack, joined by Justice Wilcox, dissented on the ground that the majority went astray by "overlook[ing] Bridon's status as an inpatient" (¶ 47).

Sexual Abuse - Statute of Limitation

John Doe 67C v. Archdiocese of Milwaukee, 2005 WI 123 (filed 13 July 2005)

The plaintiff, identified as John Doe 67C, sued the Milwaukee Archdiocese. Doe alleged that a now-deceased priest, George Nuedling, sexually abused him in the early 1960s when Doe was a minor. Doe alleged that trauma caused by the abuse caused him to repress memories of the abuse until 2002. The plaintiff brought claims of negligence, "fiduciary fraud," and breach of fiduciary duty. The circuit court granted summary judgment in favor of the archdiocese and dismissed the complaint. The court of appeals affirmed.

The supreme court, in an opinion written by Justice Prosser, affirmed. The court held that "all three causes of action require that at the time of Nuedling's alleged wrongful acts (1960-62), the Archdiocese had contemporaneous knowledge of Nuedling's abusive tendencies. Doe's complaint broadly alleges that the Archdiocese `knew or should have known of Nuedling's problems. ...' It provides the basis for this claim by alleging that the Archdiocese had knowledge about Nuedling from events that occurred in 1980, 1986, 1987, 1993, 2001, and 2002. The complaint asserts nothing from which a person could infer that the Archdiocese had knowledge of Nuedling's misconduct before 1980. We conclude that for any of Doe's claims to survive, he had to allege that the Archdiocese knew or had a basis for knowing that Nuedling was a child molester as of 1960-62. His complaint makes no such allegations. As we cannot add unpleaded facts to Doe's complaint, we affirm the circuit court's dismissal of his claims without reaching the other defenses the Archdiocese raises" (¶¶ 5-6).

Under applicable statutes of limitation, such abuse against a juvenile would have been time barred no later than 1969 or 1970. The discovery rule, as construed by prior cases, including Pritzlaff v. Archdiocese of Milwaukee, 194 Wis. 2d 302, 533 N.W.2d 780 (1995), did not extend the time for filing the claims in this case. Nothing in the complaint alleged, or raised a reasonable inference, that the archdiocese "knew of [Nuedling's] proclivities as of 1960-62" (¶ 39). The negligence claim alleged "the more specific tort of `negligent supervision'" (¶ 43) but failed because the plaintiff "did not allege any facts showing the Archdiocese's knowledge before 1980" (¶ 46).

The court next took up the claim for "fiduciary fraud." Although it has yet to be recognized in Wisconsin as a separate tort, it obviously is an amalgam of "fraud" and "breach of fiduciary duty" (see ¶ 48). "Special rules of pleading apply to fraud claims" (¶ 52). Thus, the "fiduciary fraud" claim too was defective because the complaint did not identify "particular individuals who made misrepresentations, the date of the misrepresentations, or the details of the misrepresentations" (¶ 53).

As for the breach of fiduciary duty claim, the supreme court assumed without deciding that a fiduciary relationship existed between the plaintiff and the archdiocese, but here too the lack of any allegation that the fiduciary "knew" or possessed such information vitiated the claim on the pleadings.

Justice Bradley, joined by Chief Justice Abrahamson and Justice Roggensack, concurred but would have taken the "golden opportunity" to resolve substantive issues relating to the Establishment Clause and the discovery rule in favor of plaintiffs in these types of cases.

Justice Butler, joined by Justice Crooks, joined the majority opinion but filed a concurrence that emphasized that the court "normally" does not decide constitutional questions (such as the Establishment Clause issue) when a case may be resolved on other grounds (as here).

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