Wisconsin’s legal climate for businesses has gone downhill faster than that of any other state after a series of court rulings expanded the liability of companies, the U.S. Chamber of Commerce says in a new report.
Corporate lawyers surveyed for the chamber’s annual rankings of state court systems ranked Wisconsin the 23rd best for companies, down 13 spots from just two years ago. The rankings are being released this week by the U.S. Chamber’s Institute for Legal Reform, which lobbies to limit lawsuits against companies.
Tom Donohue, president of the U.S. Chamber of Commerce, blamed the sharp drop on what he called antibusiness rulings by the state Supreme Court and on Gov. Jim Doyle’s veto of bills designed to address some of the problems.
“It’s only a matter of time before your state feels the consequences,” Donohue said in remarks prepared for delivery at a Capitol news conference. “Plaintiffs’ lawyers are clamoring at Wisconsin’s doorstep. Like unwanted houseguests, these trial lawyers will misuse and abuse your courts to suck these employers dry.”
To highlight the study, the nation’s largest business group will begin running print, radio and billboard ads in Wisconsin this week featuring the message “Wrong Way.”
Doyle spokesman Dan Leistikow said the governor has taken a “very balanced and reasonable approach” on business liability issues and argued that Wisconsin’s economy was performing well.
“It seems like this might be a little bit more about politics than it is about facts,” he said of the study.
The New York-based Center for Justice & Democracy, a national consumer group, dismissed Wisconsin’s ranking as “dishonest, unfair and contrary to the evidence about the state’s positive business climate.” The state was recently one of seven to receive top ratings from a national economic development organization, the group noted.
“These surveys reflect nothing more than the Chamber’s political agenda to limit legitimate lawsuits and accountability for corporate wrongdoers,” Joanne Doroshow, executive director of the group, said in a statement.
Donohue’s comments echo those of the state’s largest business group, Wisconsin Manufacturers & Commerce, which has declared Wisconsin in a litigation crisis after last year’s court rulings.
The court struck down a cap on damages for pain and suffering in medical malpractice cases, expanded a legal theory allowing people to sue for injuries even if they do not know which companies made the harmful product and loosened the standard for punitive damage awards.
The Republican-controlled Legislature responded with bills to effectively overturn all three rulings. Doyle at first vetoed new medical malpractice limits but signed a higher $750,000 cap into law last week.
In January, Doyle vetoed a bill that would have required plaintiffs to prove a specific product caused their injuries and was made or marketed by the company to collect damages in court. He said the bill would have shielded the makers of lead paint from lawsuits for making children sick.
The court’s ruling last summer, allowing a Milwaukee boy to sue makers of a lead paint pigment that left him mentally retarded, was the first of its kind against the paint industry in the nation. Businesses worry that lawyers will flock to Wisconsin citing the theory to sue entire industries at once.
“Any member of the entrepreneurial plaintiffs’ bar worth his salt will take advantage of this precedent,” Donohue said in his remarks.
Meanwhile, a bill to tighten the standard for punitive damage awards, which are meant to punish companies for wrongdoing, is on Doyle’s desk awaiting action. The bill is in response to the court’s decision in a case involving a $94 million jury award to families of three ironworkers killed during the construction of Milwaukee’s Miller Park.
Doyle has not said whether he will sign the bill, which would require plaintiffs to show that a company either intended to cause the injury or knew their actions were almost certain to harm to collect punitive damages. The court’s ruling said those damages could be awarded if companies acted in disregard of the plaintiffs’ rights, a lower standard.
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