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Governor Doyle Vetoes Liability-Reform Legislation

January 16, 2006

On January 6, 2006, Wisconsin Governor Jim Doyle vetoed several pieces of legislation that would have benefited manufacturers, distributors and retailers of goods who do business in Wisconsin. Governor Doyle’s vetoes included Senate Bills 58 and 70, which would have enacted a statutory product liability system and brought Wisconsin’s rules on admissibility of expert testimony in line with the more stringent rules applied in federal courts. In addition, Governor Doyle vetoed Senate Bill 402, the legislature’s response the Wisconsin Supreme Court’s decision in Thomas v. Mallett.

SB 58: Product Liability Reform
Senate Bill 58, discussed more fully in Godfrey & Kahn’s March 4, 2005 update, Federal Class Action Reform Enacted; Wisconsin Legislature Considers Tort Reform, would have, among other things, enacted a statute of repose for product liability claims, created a rebuttable presumption that products meeting state and/or federal standards at the time of their manufacture are not defective, and provided several layers of protection for distributors and retailers of products who had no role in their design or manufacture.

In his veto message for SB 58, Governor Doyle referred to the 15-year statute of repose as an "arbitrary time limit" and stated that "growing Wisconsin’s economy should not be at the expense of injured consumers’ and workers’ ability to hold wrongdoers accountable." Governor Doyle also rejected the bill’s presumption that a product is not defective if it complies with relevant government regulations at the time of sale, suggesting the provision would promote "concealment" of a product’s dangers by manufacturers. Finally, Governor Doyle claimed that providing a shield to distributors and retailers for products in sealed containers would "take away the incentive of the industry as a whole to produce, sell, and market the safest products possible."

SB 402: The Wisconsin Jobs Preservation Act
As discussed in detail in Godfrey & Kahn’s August 1, 2005 update, Recent State Supreme Court Rulings Could Impact Wisconsin Product Liability Law, the Wisconsin Supreme Court expanded the application of the "risk-contribution" doctrine, which permits plaintiffs to sue an entire industry that manufactured a generic product for injuries that the plaintiff sustained from the product, even in the absence of any proof that a specific manufacturer created the product to which the plaintiff was exposed. The doctrine, previously limited only to cases in which plaintiffs alleged a rare form of cancer through use of the drug DES, was expanded to the white lead pigment industry in the case of Thomas v. Mallett, 2005 WI 129. Some commentators have referred to the new standard as "guilty until proven innocent" and the American Tort Reform Foundation (ATRF) gave Wisconsin’s Supreme Court a "dishonorable mention" in its 2005 Judicial Hellholes publication, in part because of its adoption of the novel and dangerous "risk contribution" theory in Thomas v. Mallett.

In response to the Thomas v. Mallett decision, the Wisconsin State Senate introduced Senate Bill 402, which would have eliminated the newly expanded risk contribution theory in Wisconsin and restored a plaintiff’s burden to prove causation against particular defendants. Governor Doyle claimed, in fully vetoing the bill, that signing it into law would "close the doors of justice" to "poisoned children." Proponents of the bill, which passed by large margins in both houses of the legislature, have not yet announced whether they will seek to override the governor’s veto.

SB 70: Expert Witness Standards
Senate Bill 70 would have changed Wisconsin law by requiring state trial court judges to act as "gatekeepers" to prevent unreliable expert opinions from reaching the jury, bringing Wisconsin’s evidentiary procedure in line with the rules applied in federal courts and 37 states. Right now, Wisconsin state courts permit so-called "expert" witnesses to testify to opinions that are based on scientific, technical, or other specialized knowledge, so long as the court determines that the expert possesses adequate knowledge, skill, experience, training, or education. There is no scrutiny of the so-called "expert’s" methodology or conclusions in the particular case.

In vetoing SB 70, Governor Doyle focused on criminal cases, suggesting it would "only make the job of prosecutors in Wisconsin harder." The governor did not address the legislation’s impact on civil cases—other than to say generally that he "trusts juries in this state."

Conclusion
Without question, Governor Doyle’s vetoes of these liability-reform provisions will have a dramatic impact on Wisconsin’s business community, courts and citizens. We will continue to monitor the post-veto activity on these bills, as well as any reintroduction of them in the next legislative session.

This client update was prepared by attorney Josh Johanningmeier, a member of the firm’s Litigation Practice Group in the Madison, Wisconsin office. If you have any questions about the legislation discussed above, or about any other legal issues related to product manufacture, distribution, or sales, please do not hesitate to call Josh at 608-284-2637.

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