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Oct. 28, 2005

If there was ever any doubt that civil justice issues would rise to the top of the agenda for the 2005 Wisconsin Legislature, those doubts have disappeared with this week’s actions and floor votes scheduled for the next two weeks. The national publicity, including the Wall Street Journal article that followed three Wisconsin Supreme Court cases earlier this year, is the kind of publicity that only states competing with us on business location decisions can like. In response, legislative leaders have announced that the fall agenda will include action on “The Jobs Preservation Act” (manufacturer and seller liability), “The Main Street Protection Act” (other product liability changes) and “Health Care Access and Cost Containment” (restoration of caps in medical malpractice cases). In addition, the Legislature appears set, for the second consecutive session, to pass legislation heightening the standards for the admission of expert opinion evidence in lawsuits.

The restoration of medical malpractice caps passed the Assembly this week and will likely have floor action in the Senate in two weeks, while the expert opinion evidence and product liability bills could receive final legislative action next week. The manufacturer/seller liability bill is likely to pass the Assembly next Tuesday and the Senate the week later. (Please see below.)

The Legislature, with the Governor’s backing, also appears set to pass legislation that would merge the State Ethics Board with the State Elections Board and provide additional authority to investigate and potentially prosecute public officials.

Policy Developments

Assembly Schedules Floor Action on Major Litigation Bills
The following bills are scheduled for floor action next Tuesday, Nov. 1.

• AB-101: This bill makes numerous changes in Wisconsin product liability law that impact manufacturers, distributors and sellers, including changing the standard for the award of punitive damages from the “consumer expectation” test to requiring proof of “a reasonable alternative design” which is the current standard in 46 other states.. (SB-58, which is the companion to AB 101, has already passed the Senate and made be voted on in lieu of AB 101 which could complete legislative action on this proposal.)

• AB 203: This proposal increases the standard for the admission of expert opinion evidence and is based on a United States Supreme Court decision known as the Daubert case. The standards embodied in this proposal are the standards followed by the entire federal system and 33 other states. (SB 70, the companion to AB 203 has passed the Senate and could be substituted for AB 203.)

• AB-778. This bill, which has been entitled “The Jobs Preservation Act,” would, if enacted, overturn the Wisconsin Supreme Court’s decision (Thomas) from July of this year which expanded the “risk contribution” theory which allows defendants to be held liable in certain circumstances even without proof of the manufacture or sale of the specific product that caused the injury. (SB 402, the Senate companion has been recommended for passage by the Senate Judiciary Committee, but AB 778 is likely to be the vehicle to pass both Houses.)

Assembly Moves to Restore Malpractice Caps
The Assembly voted 64-32 to approve legislation (AB-766) to restore caps for pain and suffering in medical malpractice cases. The bill moved to the Senate Committee on Insurance where a public hearing was held on Thursday. The senate committee is expected to vote on the measure early next week and action by the full Senate is likely during the week of November 7.

The legislation would create two different levels of awards for pain, suffering and other non-economic damages in medical malpractice cases. Awards to adults would be limited at $450,000, while awards for those injured while younger than 18 could not exceed $550,000. The size of the awards could be adjusted in the future.

Assembly Bill 766 responds to the Ferdon decision issued by the Court in July of this year, which struck down the caps on noneconomic damages in medical malpractice cases adopted by the Wisconsin Legislature in 1995.

In related legislation, the Assembly also passed AB-764, which allows the introduction of collateral source payments in a medical malpractice case; and AB-765, which relates to coverage under the injured patients and families compensation fund of medical school graduates engaged in postgraduate training.

Voter Photo ID is Back in the Headlines
The Legislature, during the last two sessions has passed several versions of legislation requiring photo identification for voting in Wisconsin, all of which have been vetoed by the Governor. Earlier this week, AJR-36 was introduced which, if adopted in two successive legislative sessions and approved by referendum vote of the citizens, would amend the Constitutional to require voters to have photo ID. AJR 36 is also scheduled for a vote in the State Assembly next Tuesday, November 1.

In a related matter, a Congressional Committee held a hearing in Milwaukee this week to discuss problems from last year's presidential election in Wisconsin. U.S. Rep. Mark Green (R-Green Bay) and U.S. Rep. Gwen Moore (D-Milwaukee) were allowed to sit in and join in the questioning

Smoking Ban Preemption Stalls
The statewide smoking ban preemption narrowly passed the Assembly in June. It would have prohibited smoking in restaurants that seat more than 50 people but would have allowed smoking anywhere in restaurants smaller than that. The primary feature of this bill is that it would preempt any local ordinances not in strict conformity with state law.

Assembly Bill 414 was scheduled for a vote this week but was referred to the Committee on Senate Organization for further discussion. Sens. Scott Fitzgerald and Jon Erpenbach are currently trying to work out a compromise with the Doyle Administration.

Ethics & Elections Board Merger
The State's Ethics and Elections Boards would be merged into one body with a new investigative division that could prosecute public officials, under a bill the Legislature's budget committee approved Wednesday.

The Joint Finance Committee voted 13-3 to approve Senate Bill 1. The four-member board would be appointed by the Governor; the State Senate would have to approve the appointments.

Housing and Economic Development Authority Bills Advance
SB-269 authored by Sen. Ted Kanavas (R-Brookfield) passed the Senate Tuesday by a 32-1 bipartisan vote. This bill, which is part of Governor Doyle’s Grow Wisconsin 2005 plan, aims to modernize Wisconsin Housing and Economic Development Authority (WHEDA) programs.

Specifically, SB-269 is intended to update WHEDA authority to allow it to better respond to the changing demands of the housing consumer and provide more flexibility in the types of home loans that are offered. The bill now moves to the Assembly for its consideration.

AB-593, the companion to SB 269, was scheduled for floor action in the Assembly on Thursday, October 27, however, was not acted on.

Senate Action Would Prohibit Partial Veto
The Senate voted 23-10 to pass on first consideration a constitutional amendment (SJR 33) that would limit the use of the governor’s veto pen. The proposed amendment would prohibit partial vetoes from creating new sentences by combing parts of two or more sentences in a bill.

The veto amendment would need to pass both houses of the Legislature in two consecutive sessions before being voted on in a statewide referendum.

Prepayment Penalty Bill Advances
The Assembly Financial Institutions Committee voted Wednesday to recommend passage of AB 456 relating to prepayment penalties on variable rate mortgage loans. This bill levels the playing field between state and federal chartered lending institutions on variable rate residential mortgage loans.

Under current law, a state chartered lending institution is prohibited form including a prepayment penalty on this specific type of mortgage product, while a federally chartered institution can.

Real Estate Legislation Introduced
A recent proposal to clarify the duties of real estate agents has been introduced as Assembly Bill 783 and its companion SB 401. AB-783 is scheduled for Assembly action on Tuesday, Nov. 1.

If adopted, the legislation would modify existing real estate agency laws by:

• Allowing two agents from one company to provide full negotiation services for seller and buyer clients in a transaction.

• Clarifying that brokerage services can be provided to consumers without an agency agreement prior to negotiations.

• Defining pre-agency relationships.

• Clarifying the role and duties of subagents.

• Requiring that agency disclosures be provided in plain English.

• Requiring agents to be neutral in their dealings with all parties until one party or the other retains him or her as an agent.

• Requiring strict confidentiality of agents providing services to multiple clients in a transaction.

• Clarifying the relationship between license law and common law.

Biodiesel Fuel Bill Passes Joint Finance
Assembly Bill 72, which regulates the sale of biodiesel fuel, passed 16-0 in the Joint Committee on Finance this week.

Under the bill, if fuel is labeled or advertised as “biodiesel,” that fuel must be 100 percent biodiesel. In addition, if fuel is labeled or advertised as a “biodiesel blend,” that fuel must be at least 2 percent biodiesel.

Shoreland Zoning Bill Scheduled for Hearing
Senate Natural Resources and Transportation Committee has scheduled a public hearing for Nov 3 on AB-299.  The bill eliminates certain requirements for shoreland zoning ordinances in areas annexed by cities, villages or towns. eliminates the  requirement that county shoreland zoning ordinances remain in force after a territory is incorporated as a city or village or after a town is incorporated as a fourth class city.

Wisconsin Politics

Vrakas to Head Waukesha County
Dan Vrakas, a longtime state legislator, former Waukesha mayor and county supervisor, will take office Monday as the new Waukesha county executive. Vrakas decided to sek the County Executive position when Waukesha County Executive Dan Finley resigned to take a job as the head of the Milwaukee Public Museum. Vrakas has been a member of the Assembly since 1990.

Patrick Byrne, a Democrat who challenged Vrakas in 2004, has announced that he is entering the race for the seat vacated by Vrakas. Four Republicans are in the Republican field.

Gundrum is Elected Caucus Chair
Rep. Mark Gundrum of New Berlin was elected by his Republican colleagues as the new Assembly Republican caucus chair, replacing Rep. Vrakas

Towns Named to Building Commission
On Wednesday, Assembly Speaker John Gard (R-Peshtigo) named Rep. Debi Towns (R-Janesville) to the state Building Commission. replacing Rep. Vrakas The 11-member commission includes six legislators, the governor, a citizen member appointed by the governor, and three non-voting advisory members. Towns’ term on the board will run through 2007.

Chvala Pleads Guilty
Former State Sen. Chuck Chvala, D-Madison, pled guilty to two felony charges Tuesday after a plea agreement was reached between Chvala’s attorneys and Milwaukee County Assistant District Attorney David Feiss at the Dane County Courthouse.

By striking the deal with Feiss, Chvala gave up his right to have a jury trial, which had been scheduled for Oct. 31. Under the terms of the plea agreement, Chvala admitted guilt to one count of misconduct of public office for having state employees do campaign work, and also pled guilty to a second felony of fraudulently exceeding campaign-contribution limits. A sentencing date will be scheduled sometime in December.

Federal Developments

Meirs Withdraws/Sykes in the Mix
Harriet Miers has withdrawn her nomination for the U.S. Supreme Court. President Bush accepted her withdrawal when Congress began efforts to gain access to documents related to her role as White House counsel.

Former Wisconsin Supreme Court Justice Diane Sykes has been included in discussion for possible nominees. Sykes currently sits on the 7th Circuit and won Senate confirmation by a vote of 70-27 last year, with the support of Wisconsin Democratic Sens. Herb Kohl and Russ Feingold and both voting for her. Both senators serve on the Senate Judiciary Committee.

Political News

Panel votes to create agency with broad powers to fight corruption: Milwaukee Journal Sentinel, Oct. 27, 2005.

Democrat joins race for Vrakas' seat: Milwaukee Journal Sentinel, Oct. 27, 2005.

One lead-paint defendant settles: Milwaukee Journal Sentinel, Oct. 27, 2005.

Assembly OKs Malpractice Limits: Wisconsin State Journal, Oct. 26, 2005.

Senate Delays Vote On Banning Local Smoking Ordinances: Wisconsin State Journal, Oct. 26, 2005.

Merger of ethics, elections boards set for vote: Appleton Post-Crescent, Oct. 26, 2005.

Assembly passes malpractice caps: Milwaukee Journal Sentinel, Oct. 26, 2005.

Gard outlines legislative agenda: Green Bay Press-Gazette, Oct. 25, 2005.

Chvala pleads guilty to two felonies; sentencing postponed: Milwaukee Journal Sentinel, Oct. 25, 2005.

Senate pulls back proposal banning local smoking ordinances: Appleton Post-Crescent, Oct. 25, 2005.

Senate approves amendment to limit governor's veto power: Appleton Post-Crescent, Oct. 25, 2005.

Photo ID debate dominates hearing on election policies: Milwaukee Journal Sentinel, Oct. 25, 2005.

Dems hold emergency contraception hearing in Oshkosh: Oshkosh Northwestern, Oct. 25, 2005.

For malpractice caps, there's no middle ground: Milwaukee Journal Sentinel, Oct. 24, 2005.

Campaign spending undetailed: Appleton Post-Crescent, Oct. 23, 2005.

GM announces plan with UAW to cut health care costs as its losses mount: Racine Journal Times, Oct. 23, 2005.

State health plan proposed: Janesville Gazette, Oct. 23, 2005.

State lags in high-tech jobs: Wisconsin State Journal, Oct. 23, 2005.

GOP, biz target high court ruling: Madison Capital Times, Oct. 21, 2005.

GOP, Lobby Want Paint Ruling Nixed: Wisconsin State Journal, Oct. 21, 2005.

Malpractice caps return in bill: Milwaukee Journal Sentinel, Oct. 20, 2005.

Malpractice limit plan likely invalid, Doyle says: Madison Capital Times, Oct. 21, 2005. Rep. Meyer Ordinary High Water Mark bill heads to public hearing: Lakeland Times, Oct. 18, 2005.

Upcoming Fundraisers

Oct. 29

• US Rep. Gwen Moore (D), Milwaukee

• Sen. Judy Robson (D-Beloit), Beloit

• Rep. Joan Ballweg (R-Markesan), Green Lake

Oct. 30

• US Sen. Russ Feingold (D), Madison

Oct. 31

• Scott Walker (R) gubernatorial candidate, Antigo

Nov. 3

• Scott Walker (R) gubernatorial candidate, Milwaukee