Jerry Brushert was a can-do type of guy. He survived polio as a child and still managed to serve his country during World War II. But when he reached his 80s, he began to suffer medical problems. After a hospital stay, he agreed to be placed in a Rennes Health & Rehab Center in Weston, near Wausau, to recuperate. The stay was to be temporary, and he vowed to work hard so he could return home to his wife.
On Sept. 7, Brushert was found crushed underneath his bed. According to the family, a medical examiner determined that Brushert, deemed by the nursing home to be a fall risk, was disoriented, had tried to get out of his bed, knocked the bed's remote control to the floor, then fell on top of it, activating the bed's lowering mechanism.
Last week Brushert's daughter, Heidi Brushert Laabs, told a joint legislative committee that no one in the nursing home, including the administrator, was aware of the potential danger posed by the bed, despite warning labels on the bed itself that the bed could cause injury or death. Early last year, the family filed a lawsuit against the nursing home, which is set to go to trial in June.
The company's attorney declined to comment on the suit, but the family's attorney, Jason Studinski, says they were able to piece together the circumstances around Brushert's death after obtaining state and internal nursing home investigative reports of the incident.
Under Gov. Scott Walker's sweeping civil justice reform proposal, however, the so-called tort reform bill, the family may well have never learned what really happened. The reports detailing the circumstances surrounding the death would have been off-limits in court.
That's one of many boons for the nursing home industry in Walker's bill. But it has plenty for others as well. Retailers, distributors and any business interest in the state — for that matter, even foreign manufacturers — win with caps on court damages and the creation of new legal obstacles for those who are hurt or killed by their products and services.
And it's being fast-tracked at breakneck speed. The state Senate passed the bill on a 19-14 party-line vote Tuesday, less than two weeks after Walker enlisted GOP committee chairs to introduce it in the special legislative session on job creation. The Assembly is set to vote on it Thursday. By the end of the week, it's likely to be a done deal.
The priority given to the bill goes without saying. It's the very first legislative proposal in the new, Republican-dominated Legislature.
Wisconsin Manufacturers & Commerce has pushed many of the provisions in the bill for years as a way to roll back a 2005 state Supreme Court ruling that said lead paint manufacturers could be held liable for damaging a Milwaukee boy's brain, even though the family didn't know which company produced the paint that poisoned him. It was the first time an entire industry became liable in such a case, and WMC said the decision branded Wisconsin as a litigation-happy state, scaring off businesses and killing jobs.
James Buchen, vice president of Wisconsin Manufacturers and Commerce, calls the reforms in Walker's bill "tinkering around the edges."
"We're not talking about radical changes here," he told a combined panel of Senate and Assembly lawmakers at a 10-hour public hearing on the bill last week. "This is about bringing us into line in some areas where we're a little out of line."
That was not the take of the bill's many opponents.
"It's completely eviscerating the civil justice system," says attorney Matthew Boller. "It's taken any plausible punishment, any responsibility by any corporation, and says it no longer applies."
And when it passes, he says, "it will take a generation to reverse this legislation."
Granted, trial attorneys whose fees often depend on jury awards stand to lose under Walker's bill, but they are by no means the only ones sounding the alarm. Families with loved ones who died needlessly in nursing homes, victims of corporate negligence, sexual assault victims advocates, advocates for the disabled, consumer advocates, senior citizens groups, judges, prosecutors and the state court system all have weighed in with serious concerns. Speakers at the legislative hearing said the bill will increase the cost of both civil and criminal litigation, make it harder to hold businesses accountable for negligence, allow nursing homes to slash staff and cut corners.
Democratic lawmakers wondered aloud why they were considering a bill that created no new jobs at a special legislative session supposedly about job creation. And according to attorneys, with all the hurry to get the bill passed, its provisions have not been properly vetted.
"This is not a well-drafted piece of legislation," says John Walsh, a trial attorney and past president of the State Bar of Wisconsin, who noted that lawyers in the room couldn't even agree on what some of the provisions meant.
One thing they didn't get a chance to weigh in on was an amendment to cap punitive damage awards, currently unlimited, to either $200,000 or double the compensatory damages for things like medical bills, lost wages and pain and suffering awarded in the case, whichever is greater. Lawmakers slid it in after the hearing.
The original bill placed no limits on the dollar amount, but made the standards for punitive damages so high that attorneys complained that they were nearly impossible to meet.
The change came after a blistering outcry from lawyers, grieving family members and advocates who realized that the proposed standard meant that drunken drivers who kill were about to enjoy the same protections as corporations. So lawmakers kept the current standards and imposed the cap, but they eliminated the cap for impaired drivers. Problem solved.
"The tort reform bill will not protect drunk drivers," declared Assembly Judiciary Committee Chairman Jim Ott, R-Mequon, in a press release.
Nor will it protect consumers, says Robert Kraig, executive director of the advocacy group Wisconsin Citizen Action. And state residents have no idea what's about to befall them.
"This is an inside job," says Kraig. "It's hard to develop widespread public opposition because it's too complicated for most people to understand because they don't have time to focus on it."
Many health care officials, business leaders, and other proponents of the bill say Wisconsin's litigation climate has run amok and point to the lead paint case decision as exhibit A. But the Wisconsin Association for Justice, the state's trial attorney group, is quick to counter that tort filings have been in steady decline for years. (A "tort" by the way, is a misdeed that is settled with monetary damages in civil court.) Total tort filings fell to 5,908 in 2007 from 7,153 in 1996, according to the University of Wisconsin Law School. Within those filings, product liability was virtually unchanged — 104 cases in 2007 compared to 102 in 1996 — while medical malpractice cases fell to 150 from 228.
Faced with this, those backing the bill fall back on the argument that there is a widespread perception that Wisconsin's legal climate has spun out of control. And it's that perception we have to fix. The jobs will follow.
Jobs, after all, were supposed to be the sole purpose of the special legislative session, which is also focusing on tax cuts, economic development and deregulation.
Brian Hagedorn, Walker's chief legislative counsel, said at the legislative hearing that the tort reform bill creates "a better environment for job creators to flourish."
"These changes," he says, "send a symbolic and substantive message that Wisconsin is open for business," echoing the Walker administration's biggest catchphrase.
But there are those who believe that businesses, left unchecked, will focus solely on the bottom line at the expense of all other considerations, including safety. And government regulation, constantly under attack, often falls short. Often only the courts provide the hammer to keep businesses in line.
"Litigation can accomplish changes often where legislation cannot," says Marsha Mansfield, a former trial attorney and now a UW law professor.
Let's go back a few years for an example.
In the late 1960s, Ford was in the process of developing the Pinto, a car that could be purchased for under $2,000. Crash tests revealed that the car, when hit from behind, would spill gasoline onto the ground, which means a spark from a cigarette, the ignition or scraping metal could engulf both cars in flames. In an internal analysis obtained by Mother Jones magazine, Ford estimated that the faulty gas tanks would cause about 180 burn deaths and 180 serious burn injuries and 21,000 burned cars each year. The company estimated that it would sustain legal costs of $200,000 per death, $67,000 per injury and $700 per vehicle, adding up to $49.5 million a year. Or they could fix the tanks, at a cost of $137 million.
So the company made a business decision. They went ahead with production, and sure enough, the deaths and injuries mounted. What the company didn't count on was the size of the punitive judgments, one of which, a California jury award of $128 million, was the largest personal injury award ever at the time.
Under Wisconsin's new punitive damage caps, Ford's losses would have been much more in line with the company's business plan.
Those are "the kind of business practices that are encouraged under this bill," says Mansfield.
For a solid example of how much money the bill could save a corporation's bottom line in Wisconsin, take the three ironworkers who plunged to their deaths when a crane collapsed during the installation of the retractable roof at Milwaukee's Miller Park stadium. A Milwaukee County jury ordered Mitsubishi Heavy Industries of America, which oversaw the installation of the roof, to pay the families $94 million in punitive damages and $5.25 million in compensatory damages. So under the bill, the company would have paid $10.5 million in punitive damages.
Sure, that's still a lot of money, but the goal of juries in awarding punitive damages is not just to punish. They are supposed to deter a wrongdoer's future bad conduct. And making sure that a huge corporation like Mitsubishi gets the message takes an awful lot of money.
As Dawn Kellner — whose 15-year-old son Jared Kellner was crushed on June 24 when a 13.5-ton concrete slab fell from the outside of a county parking garage in Milwaukee — told lawmakers last week in tearful testimony:
"This bill protects the bad businesses like those that killed my son, and I want to know why. I want to know why Gov. Walker wants to protect the worst of the worst. Punitive damages keep bad businesses in check. They stop businesses from cutting corners and putting people's lives in jeopardy. But this bill removes that check. It puts profits over public safety and it endangers everyone."
Kellner filed suit against the contractors who built the garage Wednesday, just in time to beat the passage of the bill. But others will face new hurdles.
Not just punitive damages, but all damages that are allowed under the bill will be extremely difficult to get. Let's say your child is injured or killed by a Happy Meal toy. You sue McDonald's, right? That's the case now, but under this bill you have to sue the manufacturer, which is probably somewhere in China.
Wausau trial lawyer Christine Bremer-Muggli explains how the system currently works:
"All these distributors, Wal-Mart, Shopko, all of them, have indemnification agreements with the distributors, so if they get sued for a dangerous product, the manufacturer has to pay them back. That is the easiest way to do it because they're the ones that got the product from the manufacturer to put on their shelves."
But under Walker's bill you have to go after the manufacturer. You can sue the seller, but only if you can prove that you can't sue the manufacturer. Why is that a problem? Because the manufacturer is probably in some far-off country.
Walsh, the trial attorney, told lawmakers how elusive these companies can be. He's worked on cases where the owners of Chinese factories, caught red-handed, simply closed them, then reopened them a month later.
"The idea that you should put these plaintiffs under the burden to go and have to sue there, it will add so much expense, it will add so much time to these cases," he says.
And besides, Walsh says, the bill was intended to bring jobs, which presumably includes manufacturing, to the state.
"You have put a target on the back of the manufacturer," he says. "Why would that company come to Wisconsin?"
While big business in general wins in this bill, none of them win quite as much as nursing homes, which would be freed from a number of restrictions they consider burdensome.
First off, by putting investigatory records off-limits to families, Wisconsin will become a national leader in protecting long-term care providers in court.
"We are the only state that says we think it's a good idea to hide this from the victims in their search for the truth of what happened to their loved ones," Milwaukee attorney Jeff Pitman said at last week's hearing.
The hearing drew a number of folks whose loved ones were killed or maimed in nursing homes by negligence: a woman whose 26-year-old daughter died after staff did nothing when she suffered a diabetic episode; a woman whose aunt withered and died weeks after being raped by another resident who had earlier been identified as a sexual assault risk: a woman whose husband, a fall risk, suffered catastrophic injuries after toppling from his bed and then developing a massive blood clot, which went untended. These are just a sampling of the hair-raising incidents detailed at the hearing, but you get the idea.
The nursing home industry says making reports of these incidents admissible in court will hamper its efforts to improve care.
Brian Purtell, director of legal services for the Wisconsin Health Care Association, an association for nursing homes and other long-term care providers, told lawmakers at the hearing that care providers "need to be able to conduct an open and honest, warts and all, root-cause analysis."
But they can't have those types of reviews now because putting their "warts" on paper exposes them to legal liability.
"I represent a lot of nursing homes and assisted living providers," he says. "I'm still even saying now, ‘Be careful. Don't create something that's going to later be used against you."
Carl Vieth, a UW faculty member who specializes in the performance of health care systems, says the argument is troubling. He says it's an example of a "defensive posture" that's unique to medicine. In the aviation industry, for example, major mistakes are documented and addressed.
"If you made a med error and you're allowed to hide it, it isn't going to go to a magic place where someone finds it and says, ‘Oh, we're going to fix med errors.' It gets hidden."
Studinski, the lawyer for the Brushert family, says the state and internal nursing home reports that allowed the family to find out what happened to Jerry Brushert would be confidential under Walker's bill. That would deprive attorneys of key evidence, which they would have to try to find by conducting their own investigations.
From a legal standpoint, nursing home operators would rather keep that information under wraps.
"None of these (cases) go to trial, that's the hard part. They are settled," Purtell said at the hearing, referring to the many harrowing tales of nursing home neglect family members had spoken of earlier. "And to be honest, what you saw earlier today is an exact example of why these don't ever go to trial. The facts and the law take a back seat to emotion. I'm not minimizing that emotion, I'm just saying the reality of the situation. You take this before a jury, you will lose big."
In addition to the cap on punitive damages, which will be enjoyed by nursing home and non-nursing home corporations alike, the bill establishes new caps on non-economic damages for long-term care providers: $750,000 for pain and suffering and $350,000 for wrongful death ($500,000 for a child), bringing the potential liability for nursing homes in line with that of medical providers. The caps will not apply to pending cases, so the Brushert family can win unlimited damages. If the caps applied to their case, the potential awards would top out at $1.3 million if they win the case.
Boller, the Madison attorney, says the caps will give nursing homes, and any corporation for that matter, little reason to settle before a trial. Even in the most egregious instances, the worst-case scenario isn't that bad for corporations with deep pockets. For companies like TDR Inc., which owns 10 long-term nursing and assisted living facilities in northern and central Wisconsin, it would be manageable. It would mean even less for companies like Extendicare, which has hundreds of long-term care facilities in North America and at least 31 in Wisconsin, including Willows Nursing & Rehabilitation Center in Sun Prairie, which three years ago was identified by the federal government as one of the worst in the nation.
In 2007 Cynthia Wilms entered Willows to recover from a hip replacement. Six weeks later she was dead of a staph infection, which should have been easily treatable, had anyone made a serious effort to treat it.
Last year Boller won a $2.5 million settlement from Extendicare for Wilms' family. He says that under Walker's bill, the company would never have settled. Why would they? If they took the case to trial, even the maximum penalty would have been about half the settlement amount.
Tom Moore, executive director of the Wisconsin Health Care Association, a long-term care trade group, says the caps will put a lid on skyrocketing insurance costs.
"What this creates for us in terms of long-term care, and for the insurance industry I guess, is predictability," he says. "Actuarially, they're unable to identify what the risks are. So there's a certain instability and inability to predict the potential exposure to risk. As a result, insurance coverage in the past, and currently, was difficult to find and afford."
The bill may not result in lower insurance costs, he says, but "at least there would be a sense of stability." That sense of stability could allow nursing homes to boost staffing, wages and benefits, he says.
"It's a complete smoke screen, and it's a lie," counters Boller.
He says that insurance rates have nothing to do with punitive damage awards. Why? "They don't insure for punitive damages."
And at a time when nursing homes and long-term care facilities are about to be flooded with baby boomers, nursing home corporations will be able to weigh their losses in court against ever-growing economies of scale.
"Corporations know to the dollar that by decreasing staffing they will increase their profits," says Boller. "And that's exactly what they're going to do."
Then there's the criminal provisions of the bill, which would redefine criminal law as it pertains to health care workers.
Currently a health care worker who intentionally, recklessly or negligently abuses a patient or nursing home resident is guilty of a felony. Not under this bill. Anyone who "negligently abuses or neglects" someone under their care, as long as it's done "while acting within the scope of his or her practice or employment" can be sued in civil court, but they can't be charged with a crime.
That provision was in response to the case of Julie Thao, a St. Mary's obstetrics nurse who in 2006 thought she was administering pencillin to 16-year-old Jasmine Gant as she was in labor, but instead delivered a lethal epidural. Thao was originally charged with felony neglect, sending shockwaves through the medical community. She eventually pleaded no contest to two misdemeanors.
The bill even goes so far to say that health care providers can't be found guilty of causing death or bodily harm to someone "by negligent handling of a dangerous weapon, explosives or fire if the health care provider is acting within the scope of his or her practice or employment."
"This may be the first time that the Legislature is going in and trying to undo criminal charges," says Dane County District Attorney Ismael Ozanne. "For the most part they just keep adding new offenses."
The legislation comes, Ozanne says, at a time when he expects the number cases of abuse toward the elderly to rise.
"Because we're getting more awareness of elder abuse, people are more likely to refer more cases to us now."
Vieth, the UW faculty member, sees many of the mishaps in health care settings as examples of bad things happening to good people. But if a nursing home happens to hire bad people, people who commit malicious acts of neglect and abuse, then "why are we covering up for criminals?" he asks.
Now let's move to another provision that's garnered widespread criticism, the so-called Daubert standard for expert testimony, which has been repeatedly rejected by the state Supreme Court. Judges, prosecutors, trial lawyers, sexual assault advocates and the Office of State Courts all fear how this provision might play out in court.
You'll hear proponents of the bill say that anywhere from 20 to nearly 40 other states use the Daubert standard, as well as the federal government, so Wisconsin is only stepping into the mainstream. But Madison trial attorney Daniel Rottier, who has actually litigated in several states with the Daubert standard, says only 15 states actually practice it, while the others use some variations.
Expert testimony is central to both civil and criminal court. Currently, criminal prosecutors routinely use "experiential experts" such as police officers, social workers and nurses who examine sexual assault victims. These experts educate juries on the factors underlying the case. A cop might relate information on gangs, drug trafficking, drunken driving. A sexual assault nurse might shed light on how victims react to sexual assault. Social workers might testify to the impact of neglect and abuse on children. A judge can decide on the spot if their testimony will offer knowledge that will help a jury decide a case.
Under the bill, experts would have to restrict their testimony to facts and data. How do you determine if the testimony is based on facts and data? You hold a hearing. And hearings take time, especially when lawyers have a chance to cross examine the potential expert witness in the mind-numbing fashion that lawyers do when they see a chance to advance their case. And the price tag for experts goes up because the experts won't be experiential experts, they'll be people who testify for a living. And many will have to make a separate flight just to attend the Daubert hearing. Moreover, in federal court, where Daubert is the standard, there is a rule, which Wisconsin doesn't have, limiting cross examination, according to Rottier. In Wisconsin, attorneys can cross examine until a judge can find a reason to shut them up.
Critics of the Daubert standard say it will require more judges, more prosecutors, more state-paid defense attorneys.
In a Jan. 10 letter to legislative leaders, the four circuit judges in Dodge County urged lawmakers to reject Daubert for variety of reasons. Not only will it help defense attorneys knock experiential witnesses off the stand, they say, it could undercut the state's sexual predator law by allowing extensive challenges to the testimony of the psychiatrists who predict how dangerous defendants are.
And Daubert would cost money.
"This will increase the cost of criminal litigation that is often paid for on both sides by the state, as now the expert, as well as the prosecutor and public defender, will have to be paid for coming to court to participate in an additional lengthy motion hearing," the judges say.
There are more details — the bill cracks down on frivolous lawsuits, even though they rarely happen, according to several attorneys who testified at the legislative hearing. It gives an advantage to product manufacturers if a person is intoxicated when maimed or killed by a product. If a corporation hurts someone through gross negligence and gets sued, there's a court case. But the cards are stacked in the corporation's favor, and corporate execs will have a fairly good idea of how much it's going to cost them.
Imagine if Ford, Toyota, tobacco companies and BP Global enjoyed such certainty.
At the legislative hearing on the bill, Bill Smith, the state director of the National Federation of Independent Business, said the current system "has often degenerated into a system of legal shakedowns, where payoff to settle is often cheaper than defending the suit."
But as trial attorneys pointed out, businesses have no problem using the legal system to collect money from deadbeats. They do it all the time. Litigation, it seems, is only bad when a business finds itself in the role of the defendant.
Hagedorn, Walker's legal counsel, in describing the effects of pernicious litigation, offered the following example.
"You see warnings on basically every single thing you have, there's a reason those are there," says. "It's because of the threat of lawsuits."
So the warning labels on Jerry Brushert's mechanical bed, the ones the family claims nobody bothered to heed, were a bad thing.
You never hear those pushing this legislation talk about the good litigation can do — the harmful and deadly products taken off the market, the protection of the frail and elderly — much less that fact that those companies that commit gross negligence simply have it coming.
In Wisconsin, the scales of justice have tipped decidedly away from the consumer. The state is, indeed, open for business.