Committee considers litigation reform bills (UPDATE)

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By SCOTT BAUER
Associated Press

MADISON, Wis. (AP) — Opponents of a pair of Republican-backed litigation reform bills argued before a state Assembly committee Friday that the proposals will gut consumer protection laws and effectively stop the filing of lawsuits against companies that break the law.

One measure heard by the committee would limit the amount plaintiff’s attorneys can charge in some cases to three times the amount of any monetary award. Another would lower the amount of interest that people who successfully sue for injuries can collect on their judgments, while the higher interest rate would remain for judgments awarded to banks and credit card companies that take their customers to court.

Democrats argued that the bills, brought as part of a special session called by Gov. Scott Walker to pass proposals designed to improve the economy, would not create any jobs and instead would harm consumers. The Republican bill sponsors and other committee members defended the proposals.

“I don’t think any of these bills are going to magically create hundreds of jobs, but they are a piece of the puzzle,” said Rep. Jim Ott, R-Mequon, chairman of the committee.

Republican Rep. Robin Vos, who proposed limiting attorneys’ fees, said the bill would help improve the state’s economic climate by protecting employers from excessive awards.

“At a time of economic hardship in our state and our nation, we need to do all we can to assist those who create jobs,” Vos said.

Rep. Tony Staskunas, D-West Allis, said the changes would “tear the guts” out of the state’s consumer protection law because no attorney will take small cases for “the little guy.”

“Business, big or small, is just not going to be challenged anymore,” Staskunas said.

Attorneys with experience bringing lawsuits that would be affected under the fee cap told the committee that the bills will virtually repeal Wisconsin’s consumer protection laws as lawyers will not be able to afford to take many smaller cases. Vos countered that the cap would result in fewer frivolous lawsuits and lead to more settlements of cases that are brought.

“I think we’re creating a litigation climate where if someone has a reasonable claim they can find a reasonable attorney to defend them,” Vos said.

Under the Vos bill, judges would have to consider a number of factors when determining attorney fees in cases involving non-monetary damages not subject to the limit. The three-times cap would be the limit in cases where only money damages are awarded. It would be the presumed maximum in cases involving money damages and injunctive, declaratory or other relief, but a judge could determine that more fees should be awarded.

Vos said that gives judges the leeway to determine when higher awards are warranted in those cases.

Vince Megna, a Milwaukee attorney known nationwide as an expert on Wisconsin’s lemon law and others that protect car and truck buyers and users, said the cap would eliminate all consumer law cases, most lemon law cases and any claims up to $10,000.

The other bill heard by the committee affects interest that can be applied to judgments.

Under current law, those ordered to pay court judgments are charged 12 percent annual interest.

Under the bill, the maximum interest rate for people who successfully bring a personal injury case or sue under the state’s consumer credit law would be the prime rate plus 1 percent, which would be 4.25 percent currently.

However, banks, landlords and credit card companies could still get the full 12 percent.

Staskunas said he believed the current 12 percent rate was too high, but any new lower rate should apply to everyone.

“Let’s look out for the little guy a little bit,” he said. “The little guy is getting stuck here.”

Bill sponsor Rep. Paul Farrow, R-Pewaukee, said the bill was designed to help improve the economic climate for businesses that create jobs, but he would be willing to work with Democrats on making changes.

The committee took no immediate action on the proposals.

Another lawsuit reform bill not heard on Friday but backed by Walker and Republicans would give drug-makers and medical device manufacturers immunity from lawsuits if their products had been approved by the U.S. Food and Drug Administration. The immunity would not be granted if they committed fraud.

Walker’s spokesman Cullen Werwie has defended the bills, saying they deal with the type of claims that affect job creators for the long term and the changes proposed will “help create certainty and confidence in the state’s legal climate.”