Wisconsin Business and Commercial Litigation

The Wisconsin Supreme Court has accepted the Milwaukee Sizzler e. coli case for review.  As explained by the Wisconsin Bar,

A three-year-old child died and others became ill after ingesting E. coli contaminated meat at two Milwaukee-area Sizzler area restaurants in 2000. Now, Sizzler USA is fighting to obtain damages and attorney fees from the supplier of beef containing the strain.

The Wisconsin Supreme Court accepted review in Estate of Kriefall v. Sizzler USA Franchise, 2009AP1212/2010AP491, a case in which franchisor Sizzler USA obtained a $6.5 million lost profits award from the meat supplier, Excel Corp., for breaching an implied warranty of merchantability.  Sizzler USA is also seeking $1.7 million in attorney fees and costs incurred in defending the personal injury suit.

The court is asked to examine legal issues related to damage/lost profit limitations for breaches of express and implied warranties, indemnification, and attorney fees.

Although not specifically mentioned in the article above, the court of appeals also awarded to Sizzler $1.5 million that it paid to settle the underlying plaintiff’s claim against Sizzler, which is also part of the Supreme Court review.  The case is a tangle of appeals and cross-appeals, and should make for interesting reading when the Court releases its decision.

I’ve been working on this case since 2005 with  my partner Russ Klingaman.  Since the case was originally filed in 2000 or so, it’s good to see that we’re getting close to a resolution.

I don’t usually mention current cases that my firm is working on, but this one got some press, and it’s an interesting case.  While the claim is for legal malpractice rather than entirely business or commercial litigation-related, the underlying patent management concerns affect many of those who read this blog, and the damages issue will be much like any business litigation matter.  According to the Milwaukee Journal-Sentinel,

The Mequon makers of a device that measures the quality of gemstones have sued their former patent attorneys, contending they negligently let a critical patent lapse, allowing competitors to copy the valuable technology.

GemEx patented a process that scientifically measures and records the interplay of light reflecting and refracting within gemstones, according to the lawsuit, and offers an alternative to a jeweler’s subjective assessment of color, clarity, carat weight and cut.

According to the suit, filed in Milwaukee County Circuit Court, GemEx had the market for testing cut gems with scientific spectrophotometry to itself because its patent prevented others from using the proprietary process. The patent was issued in 1997 and would have lasted until 2014, the suit said.

But GemEx and UGTS say their patent lawyers failed to file a maintenance fee in 2004, and as a result the patent expired in 2005. Since then, competitors have been using the technology and cutting into GemEx’s share of the market, the suit contends.

The rest of the article is available at JSOnline.  My partners David Hanus and Tom McGarry represent one of the law firm defendants.

Congratulations to my partner Randy Arnold and, less modestly, to me.  We just got the court of appeal’s decision in Smith v. Weigelt, et. al, from the District 1 Court of Appeals.  We were retained to defend a surgeon accused of malpractice when a sponge was left in a patient after emergency surgery.  Randy and I tried this Milwaukee County case one and a half times. 

The first trial ended (early) in mistrial and the court ordered our client to pay costs and fees to the plaintiff’s counsel.  The court found that a question and answer during the direct examination of the defendant violated a pre-trial order in limine preventing any testimony that the doctors had saved the plaintiff’s life.  The court ordered the case re-tried.  After the second trial, in which the jury found that our surgeon client had not been negligent (yeah, you read that right), we appealed the mistrial and costs order.  The court of appeals agreed with us, and overturned the trial court’s mistrial order and order to pay costs.

Today’s decision is fact-specific, doesn’t break any new legal ground, and likely won’t be published.  The court analyzes the specific question asked on direct examination in light of the pre-trial order in limine.  But it sure is nice to have some vindication of a defense strategy and related trial action.  If you read it, I hope you enjoy it – I know I did.

For the past three weeks, I was working with Jeff Fertl, another lawyer in my firm, on a products liability trial in Milwaukee County.  The plaintiff driver of a 1999 Jetta, driving on a straight, level, dry roadway in light traffic on a mostly sunny day, suddenly veered sharply to the right, leaving the highway.  The car struck the embankment, rolled 4 1/4 times, and ejected the plaintiff through the sunroof sometime during the second roll. 

A spine injury resulted in paraplegia, and she sued VW, among others, claiming that the buckle in the Jetta was negligently designed and unreasonably dangerous.  The design flaw, her experts argued, was that the buckle became inadvertently unlatched during the right steer maneuver (the sharp right turn) when her elbow contacted the button, rendering her unrestrained during the crash sequence. 

Jeff Fertl and I represented defendant VW in trial (by the time trial started, all other defendants had either settled or been dismissed).  Dan Rottier and Don Slavik of Habush, Habush, & Rottier, one of the state’s preeminent plaintiffs’ firms, represented the plaintiff.

One of the major issues was whether the plaintiff had been belted at the time of the accident.  At trial, an Ozaukee County Sheriff’s Deputy testified that, during his investigation at the scene of the accident, the plaintiff had told him she was not wearing her seatbelt.  Conversely, a passenger in a passing Yukon testified that he had observed the plaintiff wearing her seatbelt just before the accident occurred.  In addition, the plaintiff’s friends and family testified that “she always wore her belt.”  The defense called a human factors expert to discuss factors affecting observation, cognition, and recall, and to demonstrate the amount of time the eyewitness would have had to observe the belt. 

The trial lasted three full weeks before Judge William Brash, and the jury finally came back with a verdict late on Friday afternoon.  The jury, answering the damages question, found $18 million in damages (in closing, the plaintiff requested that the jury award about $27 million), including past and future medical expenses, past and future pain and suffing, and loss of earning capacity.  However, to the first question on the verdict, “Was the plaintiff wearing the available occupant restraint system at the beginning of the crash?,” the jury answered “No.”   In the end, the defense ended up winning on this factual issue, and the issues of product defect and negligence never came into play.

It was an exciting trial, if long, with some of the best lawyers I’ve ever seen in a courtroom, and it was rewarding to be part of the process.  Certainly, Dan Rottier is one of the most highly-regarded plaintiff’s lawyers in the state, and Jeff Fertl tried as good a case as I’ve ever seen.  Congratulations also to the men and women of Volkswagen, whose product has been vindicated.

Jack Zemlicka’s recent article on internet research of potential or actual jurors raises some good issues.  The article primarily discusses investigating potential jurors in the days leading up to jury selection (kinda like Gene Hackman in the Runaway Jury).  As the article points out, however, there are many courts (Milwaukee County, for one) where the juror list is not available until a few minutes before the jurors walk into the court room.  Unless a client is willing to pay for a LOT of support, the time frames make it impossible to glean useful information in such short order.  As a result, most Milwaukee County juries are picked the old-fashioned way — intuition, experience, and let’s face it, some luck.

However, that doesn’t mean that no research can or should be done once the jury has been selected.  In the last trial I had in Milwaukee, we learned a great deal about our jury after the close of business on the first day.  I believe that it helped to better craft our case, which eventually prevailed.  It’s easy to get caught up in the science of lawyering — the details of preparing for the next witness, the arguments over evidence, preserving objections and the record for appeal, or preparation of exhibits and demonstrative evidence.  We can sometimes overlook that a trial is mostly about persuading the people who sit in the jury box that we are fair, trustworthy, and reasonable.  The more we know about them, the more chance we have to succeed.

Jury dootie begins photo courtesy kelly cree under this creative commons license.

The Milwaukee Business Journal reports that a severe outbreak of swine flu could “devastate businesses”  already stretched thin on manpower by staff cuts resulting from the economic downturn.  The swine flu made quite a stir a few months ago with every TV news station and many written outlets (the Business Journal was one exception) competing to provide the most over-the-top, hysterical reporting on what a worldwide pandemic this would surely turn out to be.  Now that it’s back and actually making inroads, the reporting is relatively quiet.

Ironic that the same update of the Business Journal reports that Milwaukee County, like many other governmental entities (including the State of Wisconsin), has turned to furlough days to address budget concerns (this only avoids a tough decision for the time being, but that’s another story for another blog). 

Used under a Creative Commons License from agoode's Flickr gallery

For-profit business, which must operate efficiently to survive, can’t afford to lose much of their workforce for a couple of weeks without severely hampering productivity.  Governmental entities, apparently, have so much extra staffing that the government services can proceed uninterrupted even without a substantial portion of the workforce for a substantial period of time.

On June 12, 2009, Milwaukee County Judge Thomas Cooper concluded that the City of Milwaukee’s sick leave ordinance was both improperly enacted and an unconstitutional exercise of the City’s police powers.  The Journal-Sentinel more completely summarizes the decision and order.  The legal deficiencies identified by the court are fairly easily remedied, so even if the decision holds up on appeal, the legislation is likely to re-appear in the next couple of years.  The decision itself is worth a look, a little formulaic, but exhaustive and well-researched.  I can’t find the decision itself online yet.  When I do, I’ll try to post a link.

On May 19, 2009, the Milwaukee Journal-Sentinel ran an article discussing the $765,000 cost of a lawsuit brought by five local school districts seeking the return of $200 million in investments made in 2006.

The Houston law firm involved is charging $325 per hour.  Milwaukee firms involved in highly specialized litigation generally charge, on purely hourly basis, this much or more.  What’s interesting here is that the school districts’ payment arrangement also includes a contingent-fee component, providing for additional legal fees ranging from 5% of any recovery below $50 million and up to 15% of the total recovery if the case gets to trial.

These kinds of blended-fee arrangements are becoming more common, particularly in high-dollar cases.  Agreements like this can be useful, guaranteeing the law firm some sort of payment for its work, but also saving the client from paying the full price of hiring specialized litigation counsel unless there’s some measure of success.