Wisconsin’s Tort Reform Four Years Later: A Proven Victory For Manufacturers

The November 2010 elections in Wisconsin gave the Republican Party control of the governor's office as well as both houses of the state legislature for the first time since the 1969 legislative session. Until 2008, when conservative Justice Michael J. Gableman was elected, the Wisconsin Supreme Court similarly had long been controlled by a liberal majority.

Responding to the historic budget deficits and propelling forward a "pro-business" platform, the Republican governor and legislature moved quickly after gaining political control to pass several new laws that sparked well-publicized and unprecedented protests, recall elections, and public dysfunction of the sharply-divided Wisconsin Supreme Court (including an alleged physical altercation between justices). As part of his pro-business agenda, within the first month of taking office, Wisconsin Governor Scott Walker signed into law the most sweeping changes to product liability law Wisconsin has ever seen.

Although there had been many past opportunities to modernize our product liability law, Wisconsin's liberal Supreme Court and Democratic-controlled governor's office refused to do so. The Wisconsin Supreme Court created a market-share liability cause of action and refused to impose any Daubert-like protections against unreliable expert opinions. Wisconsin had no general statute of repose; and plaintiffs could establish product defects by the consumer contemplation test as opposed to the reasonable alternative design test a majority of states applied. Fast dockets combined with the many plaintiff-friendly product liability laws made Wisconsin a risky and unfavorable venue for manufacturers.

That all changed in January 2011 with the Omnibus Tort Reform Act (2011 Wisconsin Act 2). It changed these and many additional aspects of Wisconsin tort law, including limiting punitive damages, adjusting comparative negligence, limiting distributor liability, rewarding manufacturers' compliance with standards, and penalizing plaintiffs' use of intoxicating substances. These new laws now allow manufacturers to better manage the risk of doing business in Wisconsin by limiting liability and reducing defense costs.

This Article2 examines how courts have treated Act 2, and analyzes Act 2's impact on Wisconsin litigation. Four years after its passage, Act 2 remains good law. The changes to the law will lead to better results for companies defending Wisconsin suits, and already appear to be reducing the number of lawsuits filed in the state.

1. Act 2 Dramatically Changed Wisconsin Law.

   Market-Share Liability Limited

   The legislature directly attacked the Wisconsin Supreme Court's decision in Thomas v. Mallett,3 in which the court had created a new risk contribution theory of recovery (also known as market-share liability). In a sharp departure from traditional product liability law, the risk contribution theory allowed plaintiffs to bring a claim by merely alleging that a general type of product, not the specific manufacturer's product, caused an injury.

   Manufacturers could be jointly and severally liable simply by making that type of product, even absent evidence that the claimant used the product they made.

   Act 2 now generally requires plaintiffs to prove that the defendant produced the specific product alleged to have caused the injury. Even so, Act 2 does allow plaintiffs to utilize the risk contribution theory under very limited circumstances, such as if the claimant cannot identify the specific product that caused the injuries and no other recovery is available. But before liability may be apportioned, the claimant must prove: (1) the injury could be caused only by a manufactured product chemically identical to the product that allegedly caused the injury; (2) the manufacturer's product is chemically and physically identical to the product that caused the injury; and (3) the defendant manufactured its...