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High court moves to stop stipulated vacatur

The state’s high court has taken steps toward eliminating the ability of parties in a lawsuit to ask that trial court or court of appeals decisions that they don’t like be vacated or reversed.

The Wisconsin Supreme Court has “approved in principle” an order that would eliminate requests for stipulated reversal or stipulated vacatur of lower court decisions. That move took place Oct. 22, during a Supreme Court administrative session where the justices voted 4-2 in favor of the change. Justices David T. Prosser Jr. and Jon P. Wilcox opposed the change and Justice William A. Bablitch was absent.

The issue involved a request by the Judicial Council that Section 809.18 of the Wisconsin Statutes be changed to read that “Requests for stipulated reversal or stipulated vacatur of a lower court decision are not permitted.”

Marquette Law Professor Shirley A. Wiegand chaired the council’s Evidence and Civil Procedure Committee when it drafted the proposal. Wiegand told the justices that the proposal was designed to provide “predictability, uniformity and certainty in the law.”

Wiegand highlighted a number of arguments supporting the proposed change. Among the issues was the consideration of to whom a court decision belongs — whether its the property of the litigants or whether it belongs to the public.

She noted that issuing a decision is a public act by a public official and it is not something for litigants to barter away as part of a settlement. Decisions can have a value for issue preclusion or a precedential value.

“It also impugns the integrity of the courts, taking a trial court’s judgment and vacating it rather than having the parties settle and dismiss the case,” Wiegand said. “It is a gesture to the trial court that the parties can simply agree that the decision was wrong.”

She continued, “The loss of precedent when vacatur is granted by stipulation actually translates into an inefficient use of court resources. The lower courts have expended time in reviewing the merits of this case and now one of the parties has bought its way out of the decision.”

Wiegand referred to the U.S. Supreme Court’s decision in U.S. Bancorp Mortgage Co. v. Bonner Mall, 513 U.S. 18, 26 (1994) to support the Judicial Council’s proposal. That decision, authored by Justice Antonin Scalia, dealt with the federal high court’s refusal to vacate a federal court of appeals decision. The unanimous decision stated that in federal courts “mootness by reason of settlement does not justify vacatur of a judgment under review.”

Wiegand referred to Scalia’s concern that allowing stipulated vacatur might actually deter settlement earlier in the litigation process if the parties knew they could have a lower court decision vacated down the road.

“If a party knows that it can buy its way out of a judgment, it may be tempted to take its chances at trial, see what the judgment is, then after an appeal has been taken, buy its way out of the judgment,” Wiegand said.

Wiegand and Court of Appeals Judge Patience Roggensack both raised concerns that stipulated vacatur favors the wealthy who can buy their way out of a decision they don’t like by paying for a settlement after the fact. Part of that settlement could include an agreement that the parties would petition the Supreme Court to vacate a lower court decision.

“I think vacatur would be inappropriate because I think it would treat the poor litigants before the court differently than those who have money in their pockets,” Roggensack said. “I don’t think that has ever been the standard of the Wisconsin court system.”

The State Bar of Wisconsin Board of Governors issued a statement opposing the proposed change. In that statement, the Board of Governors noted that the power of stipulated vacatur has not been abused.

It stated: “First, this Court has long had the power to vacate judicial decisions on an equitable basis. The Court has used that power sparingly and only after careful deliberation balancing the public interest against the interest of private litigants.”

The Board of Governors also expressed concerns regarding the broad nature of the petition and the potential for conflict with other statutes that spell out the high court’s ability and responsibility regarding the vacation of circuit court decisions.

State Bar President-elect R. George Burnett appeared before the court to expand upon some of the group’s positions. He indicated that they did not see vacatur of decisions as a tool belonging to litigants. Rather, the consideration of decisions and their precedential value belongs to the court, he noted.

“What concerns the State Bar is that this appears to be an absolute
bar against vacatur,” Burnett said.

Finally, the board noted that there may be good reasons for vacating the judgments of lower courts when there are questions about its accuracy.

“If the parties settle such a case before this Court clarifies the law, the lower court decision stands and the state of the law may be inaccurate,” the statement read.

Several justices also raised that issue during the Oct. 22 public hearing on the petition. They raised concerns about the high court maintaining some authority to vacate or reverse the decisions of lower courts.

“Clearly courts have the authority to vacate their own judgments and the judgments of lower courts,” Wiegand responded. “I don’t think this rule changes that. It only limits that ability to vacate when parties themselves are agreeing that will happen and the court has not considered the merits of the case at all.”

Concerns over that issue carried over into the Supreme Court’s administrative conference later in the day. Justice Ann Walsh Bradley moved to adopt the proposal; however, Prosser and Wilcox expressed a reluctance to give away the court’s discretion to vacate decisions.

Wilcox urged the approval of an alternate proposal that would allow parties to continue bringing requests for stipulated vacatur. However, the court would act according to the presumption that vacating a decision was not in the public’s best interest. He expressed a desire for the court to maintain some “wiggle room” when it came to the issue of vacating lower court decisions.

Justice Diane S. Sykes pointed out that the court has and would continue to have an inherent ability to reverse or vacate lower court decisions on its own. The petition, she noted, would simply take it out of the hands of the litigants to decide that a decision should be vacated.

“There are other procedural avenues for lawyers and litigants to get rid of judicial decisions or opinions that they find unfavorable,” said Sykes, who seconded the original motion. “But I don’t think we should allow them that stipulation.”

The change, she explained, merely keeps litigants in a case from using stipulated vacatur as a bargaining chip in their negotiations.
Prosser took a stronger stand, expressing surprise that the court would consider giving up its ability to consider stipulated vacatur. He noted that the court does not “rubber stamp these things.”

“I think it’s almost unbelievable we would surrender, or apparently surrender, this power,” Prosser said. “This is the Supreme Court.”


Wisconsin Supreme Court

Prosser indicated that he would favor an alternate proposal stating that stipulation was “presumptively undesirable,” but not eliminating it completely.

Justice N. Patrick Crooks supported the elimination of stipulated vacatur as long as the proposal clearly indicated that the court could continue to vacate decisions that it disagreed with.

“I want to make sure this court would not lose its wiggle room if it felt that, for whatever reason, it was appropriate to vacate a lower court decision,” Crooks said. “I don’t want to adopt something that restricts the inherent power of this court to ever vacate a decision.”

Both Bradley and Sykes agreed to allow, as part of their motion, the inclusion of a statement clarifying that adoption of the petition would not remove the ability of the court to vacate a lower court decision on its own authority. The justices approved the petition with a 4-2 vote and asked staff to redraft the proposal with the additional wording.

Chief Justice Shirley Abrahamson indicated that the proposal has been “approved in principle.” Once the petition is revised with the additional language clarifying the court’s inherent ability to vacate lower court decisions, it will come back to the full Supreme Court for a final vote. That is expected to take place during its next administrative meeting.

Tony Anderson can be reached by email.

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