Tuesday, April 25, 2006

Anatomy of a Veto

A lawyer from Madison had a column in the Milwaukee Journal Sentinel yesterday criticizing Governor Doyle's veto of a bill that would have changed (actually restored an earlier understanding of) Wisconsin's rules governing remedies for frivolous litigation. Although I am intimately familar with the limitations of a 700 word column, he doesn't quite explain it thoroughly, although his larger point is exactly correct.

Wisconsin had a rule that permitted courts to award attorney's fees against parties (and their lawyers) who brought frivolous claims. A word of explanation is in order. A frivolous claim is not a case you lose. It is not even a claim that you are likely to lose. It is, essentially, a claim that, under the law and facts, you can't win. It's a claim that no lawyer not under the influence of illegal substances should bring. If you want to compare it to a concept that is applied to the rest of the civilized world, it's negligence (actually, closer to recklessness).

The Wisconsin Supreme Court interpreted the rule to be mandatory. If the claim is found to be frivolous, the party against which it was filed gets it attorneys' fees and costs. In other words, it gets made whole like anyone else who is harmed by someone's negligence.

The new rule doesn't say that can't happen, but it says (in additon to some other things) that it doesn't have to and arguably provides that, in most cases, it shouldn't. It says that the penalty for a frivolous lawsuit should be " limited to what is sufficient to deter repetition of such conduct or comparable conduct by others similarly situated." It requires a specific finding that an award of attorneys' fees (i.e., compensating the victim for what he or she has lost)is necessary to deter future misconduct before they can be awarded. Otherwise, the court should impose some (presumably) lesser sanction.

The legislature moved to change this and Doyle, on Good Friday, vetoed the bill. He said it eliminates "judicial discretion" which, for some reason, must be sometimes be exercised so that a harm is not remedied.

The new rule was championed by trial lawyers and there is a tremendous irony there. The plaintiffs' bar would go ballistic if anyone proposed that persons hurt by negligence or a defective product need not be made whole. If Wisconsin Manufacturers & Commerce proposed that we change the law so that a court (or jury) need not fully compensate a plaintiff for what she has lost (i.e., medical expenses, lost wages, etc), but need only impose some type of award sufficient to deter such conduct in the future, there would be a mobilization like we haven't seen since the Allies landed at Normandy.

Some people made arguments about trying to get the state rule to mirror the federal rule, but you could say that what happened here is that the trial lawyers did not want to be subject to the same standards that they hold everyone else to.

And Doyle went along.

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