Tort Reform Will Change Wisconsin's Litigation Landscape
February 3, 2011

By Marilyn M. Carroll, Alec Dobson

Governor Scott Walker signed into law on January 27, 2011, a “tort reform” package of measures that significantly change the litigation landscape in Wisconsin. These measures limit punitive damages, limit non-economic damages against long-term care providers, limit disclosure or use of certain information of health care providers, and raise standards for allowing expert witness testimony.

These new laws took effect February 1, 2011. Here are the key provisions:

Punitive damages

Punitive damages will be limited to twice the amount of compensatory damages recovered by the plaintiff, or $200,000, whichever is greater. Previously there was no statutory cap on the amount of punitive damages. The cap does not apply to the recovery of punitive damages for injuries caused by drunken drivers.

The legislation had included a heightened standard to recover punitive damages. It would have required proof that the defendant intended to injure particular people or knew that his or her actions were practically certain to injure someone. However, that proposed new standard was dropped from the final version of the legislation. The standard remains unchanged: A plaintiff must show that the defendant acted maliciously toward the plaintiff or in intentional disregard of the plaintiff’s rights.

Damages against long-term care providers

Plaintiffs will not be able to recover more than $750,000 in non-economic damages from long-term care providers. Non-economic damages include pain and suffering; mental distress; loss of enjoyment of life; and loss of companionship, love or affection. Long-term care providers include nursing homes, community-based residential facilities and hospices, among others. Long-term care providers will be covered by the same cap that exists in medical malpractice actions.

In addition, in cases involving long-term care providers, compensation from other sources, such as health insurers or Medicare, will be now admissible as evidence. This is a major departure from the “collateral source rule,” which does not allow evidence of payments from sources other than the defendant. Evidence of such payments may be expected to reduce juries’ damages awards accordingly.

Disclosure and use of certain health care records

The law takes two steps to restrict the use of certain health care records.

One of these steps is to prohibit incident/occurrence reports from being used in any civil or criminal action against a health care provider. Under the statute, “health care providers” include hospitals, nursing homes, community-based residential facilities and affiliated organizations of those entities, as well as physicians, nurses and certain therapists, among others.

The other step is to expand protection for certain information or records related to the review of health care services. Previously, when an organization reviewed or evaluated a health care provider’s services, in an effort to improve quality or avoid improper usage, the records of the organization’s investigations and conclusions generally could not be disclosed and could not be used in a civil or criminal action against the provider. Under the new law, the protection is expanded to include records of reviews by individuals, and not just by organizations. As under the old law, a record will not be protected merely because it was presented for review.

Expert witness testimony

The new law raises the standard a witness must meet in order to be qualified by the court as an expert. Instead of a “relevance” standard, experts in Wisconsin will have to meet the federal “reliability” standard (known in legal circles as the Daubert standard, after a U.S. Supreme Court case with that name).

Previously, witnesses could testify as experts in Wisconsin if they were qualified by knowledge, skill, experience, training or education and if their specialized knowledge would help the jury (or judge in a bench trial) understand the evidence or determine a fact in issue. Under the new law, expert witnesses still must meet that test and also satisfy three additional factors: their testimony must be based on sufficient facts or data, it must be the product of reliable principles and methods, and the experts must apply those principles and methods reliably to the facts of the case.

The Wisconsin rule now matches the rule in federal courts.

Other matters

The new law also:

  • Raises the standards that plaintiffs must meet to hold a manufacturer, distributor, seller or promoter of a product liable when the plaintiffs cannot connect the defendant to the specific product that allegedly caused the injury.
  • Establishes new standards for holding manufacturers liable on claims of “strict liability,” which is when the plaintiff does not need to prove specific acts of negligence.
  • Makes parties, and not just their attorneys, liable for costs and attorney fees for frivolous claims.
  • Prohibits reports or statements from health care providers or their employees given to state regulators from being used as evidence in civil or criminal actions against health care providers.
  • Removes criminal penalties for health care providers, acting in the scope of their employment, who commit acts or omissions that amount to ordinary negligence or good-faith error.

Date of application

The provisions regarding punitive damages, expert witnesses, frivolous actions and product liability apply to lawsuits commenced on or after February 1, 2011, but not to existing lawsuits. The provisions regarding use of health care information apply to disclosure or use of such information occurring on or after that date, even if the lawsuit has already been commenced.

If you have questions about the changes discussed in this client alert, please contact your Davis & Kuelthau attorney or a member of our Health Care Litigation team:

Marilyn M. Carroll at mcarroll@dkattorneys.com or 262.792.2412
or Alec Dobson at adobson@dkattorneys.com.

 

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