On May 10, 2012, my partner Russ Klingaman spoke to over a hundred interested attendees at a Bed Bug Seminar put on by Batzner.  Batzner Pest Management, Inc., has a pretty good set of materials related to bed bugs, something that every landlord, hotel owner, renter, hotel guest, and garage-sale shopper (to name just a few) should read.  Check Batzner’s website and look at the links on the lower left side of the page. 

Russ did a great job of explaining the latest bedbug litigation developments around the nation, and what the considerations are for Wisconsin businesses seeking to avoid problems.  The issue’s not going away, and it’s better to consider how to deal with it before it’s too late. 

Photo courtesy of martakat83 via this license.

The trial court, after some procedural wrangling, inserted Cintas No. 2 as a named defendant, and also awarded a default judgment against it. 

The court determined that the facts in this case are akin to those in Hoesley, 46 Wis. 2d 501, in which the correct defendant was served despite being misnamed in the summons and complaint. Because Cintas No. 2 was the entity served, the court concluded that “allowing the amendment of the pleadings would not be adding a new party to this lawsuit.” Furthermore, persuaded by the South Carolina Court of Appeals’ decision in McCall v. IKON, 611 S.E.2d 315 (S.C. Ct. App. 2005), the court found that the misnomer in Johnson’s summons and complaint was “due entirely to the actions of [Cintas No. 2] in terms of the business name it choose [sic] to operate under in the State of Wisconsin and in relation to [Johnson].” Given those circumstances, the circuit court concluded that Cintas No. 2’s failure to timely answer was the result of its own actions and neglect. The court therefore granted Johnson’s motion to reconsider, permitted Johnson to amend his pleadings to name Cintas No. 2 as the correct defendant, and entered default judgment against Cintas No. 2.

The court of appeals reversed, concluding that because Johnson’s summons and complaint did not name Cintas No. 2 as required by Wis. Stat. §§ 801.02(1) and 801.09(1), the circuit court lacked personal jurisdiction over Cintas No. 2, irrespective of whether Cintas No. 2 was served with or had notice of Johnson’s pleadings.

The Supreme Court agreed:

We conclude that service in this case was fundamentally defective because Johnson failed to name Cintas No. 2 as a defendant in his summons and complaint, contrary to Wis. Stat. §§ 801.02(1) and 801.09(1). Therefore, the circuit court lacked personal jurisdiction over Cintas No. 2, regardless of whether or not the defect prejudiced Cintas No. 2 and regardless of the manner in which Cintas No. 2 held itself out to the public or to Johnson specifically. Because the circuit court lacked personal jurisdiction over Cintas No. 2, the default judgment entered against Cintas No. 2 is void.

The simple lesson is to get the names right at all costs.  But that’s difficult when, as here, the name of the party is obscured by the actions of the party itself.  This ruling will increase the difficulty in preparing proper complaints, and will cause more parties to be dragged into litigation by Wisconsin attorneys unwilling to risk naming less than every possible party.  But what choice is there?

This meeting always reminds me of a few things.  First, I am truly blessed to be part of such a diverse and widespread firm.  It greatly benefits my clients by providing instant access to quality counsel in almost every jurisdiction in this country.  It benefits me in that I have nearly unlimited resources and feet on the ground in just about anyplace anything will happen to a client of mine.

Second, I believe this firm contains more first-chair trial lawyers per square foot than any other firm in the county.  Our firm started with trial lawyers, and continues the tradition to this day.  I am proud to be associated with such an accomplished and successful group of professionals.  I don’t think you can find a deeper pool of trial talent than we have available.  Taking the Milwaukee office as a microcosm of the firm at large, out of 15 lawyers, at least 11 have first-chaired more than a handful of cases to verdict. 

Finally, I am thrilled that our firm culture is one that permits all of us to come together and enjoy one another’s company.  As our chairman often says, these aren’t just great lawyers, they’re great people.  I have never been in a firm that has a better sense of community and collegiality than this one.  And that is, most importantly, reflected in the teamwork we offer to our clients and the results that we obtain for them.

I always look forward to this weekend, and this year is no exception.

This time was a little different, in that there was only minor dispute regarding the facts of the case, just a need to get them in front of the factfinder for decision and analysis.  Also different is that since this was a court trial, there’s no immediate decision.  Rather, we’ll wait until July for the outcome. 

Judge Pocan was his typical analytical and measured self.  Opposing counsel, Andy Oettinger, was a credit to his client, his firm and to Wisconsin lawyers in general.  Setting aside the merits of the controversy, this case has been a model of professionalism and decorum between counsel and the court.  For that, I express my sincere gratitude to all involved.  It’s made what is always a taxing procedure more efficient, less costly, and smoother than many other suits in which I’ve been involved.

Trials will always be one of the most compelling things that we lawyers do.  I’ll be sure to let you know how this one turns out.

After signing the sales contract but before paying the deposit, my client visited the property securing the loan and discovered that a major tenant was moving out of the property.  Among the due diligence materials provided by the bank, however, was a September 2009 appraisal stating that this same tenant had just signed a 5-year lease renewal.  The bank argues that other documents in the package should have tipped off my client that the renewal hadn’t happened. 

After learning of the non-renewal, my client contacted the borrower of the loan that was the subject of the bid.  According to the borrower, he had informed the bank months earlier of the tenant’s intention to move out.  My client then informed its investors of the bank’s prior knowledge of the tenant move-out, and the appraisal’s subsequent misrepresentation of the value of the property.  The investors, unwilling to risk their investment on an asset that had been over-valued, pulled their funding commitments, and my client did not make the deposit as required by the sales contract.

Trials are always the most enjoyable part of my practice, and this one won’t be an exception.  I’ll let you know what happens when I find out.

Writing for the Wisconsin State Bar, Michael Brennan summarizes the major changes:

As a result of these changes, defendants may be able to remove more cases from state to federal court, and at later times during the course of a case. Those cases will be streamlined by not including state law claims that do not qualify under the supplementary jurisdiction statute. But in cases involving foreign persons, or corporations or insurers with significant foreign operations, close examination will be necessary to determine if federal jurisdiction does exist.

Wisconsin lawyers who practice regularly in federal court are already up on these changes.  If you only get to the Federal occasionally, brush up on the new rules sooner rather than later.

federal courthouse photo courtesy photmatt28 via this license

Beidel left the employment of Sideline Software and attempted to enforce the repurchase agreement.  Sideline Software refused, and Beidel then sued for specific performance of the agreement.  Sideline Software argued that Beidel was never terminated (which reduced the per share amount to be paid under the agreement).  Beidel, on the other hand, argued that Sideline Software constructively terminated him as part of a scheme to reduce the purchase price.

Because Beidel never resigned, the circuit court concluded that no constructive termination could have occurred.  The circuit court acknowledged that the equities might favor Beidel, but that it felt constrained by case law to impose the requirement of actual resignation.  Disagreeing, the court of appeals concluded that the circuit court, because a claim for specific performance is equitable in nature, should have engaged in a balancing the equities to reach its decision:

The circuit court did not, however, consider the balancing of equities required in a case where a party seeks specific performance of a contract.  Although the essential facts (who did and said what and when) may not be in real dispute, the parties dispute the inferences that can be drawn from those facts.  As seen from their respective positions, outlined above, they each assert that the balance of the equities tips their way.  We thus remand for the circuit court’s determination where the bulk of the equities lie, including an evaluation of what the parties intended when they agreed to the stock re-purchase agreement, and whether it should grant specific performance as Beidel requested.

This decision could signal an expansion of the constructive discharge doctrine, or it could be no more than a reminder to trial courts to exercise their discretion in equitable matters.  However, I think it likely that more Wisconsin lawyers will use this case as a reason to seek specific performance, despite losing the right to a jury, in the hopes that fairness arguments will carry the day.

SB 202 reverses existing law signed in 2009 by Governor Doyle, which provided for increased penalties.  Attorney Saul Glazer, writing for the State Bar, describes the current state of the law and effects of the new bill:

Before the 2009 changes to the WFEA, a person alleging employment discrimination, unfair honesty, or unfair genetic testing could file a complaint with the DWD for employment reinstatement, back pay, and costs and attorneys’ fees.

Under Act 20, passed under former Gov. Jim Doyle, in addition to the remedies above, a person who prevailed in a claim filed before the DWD based on discrimination, unfair honesty, or unfair genetic testing has the right to bring an action in circuit court to recover compensatory and punitive damages, after the completion of all administrative proceedings before DWD and LIRC concerning the violation.

However, Glazer comments (and I agree) that Doyle’s law likely had effect only during settlement negotiations:

There are no known court cases where an employee received compensatory or punitive damages following a finding of discrimination. So Act 20, at most, influenced settlements after an employer lost before the DWD on a discrimination claim.

The plain fact of the matter is that Wisconsin employers (and their lawyers) must still be very careful about WFEA and federal anti-discrimination laws, given the dizzying layers of complex government regulation.  This change merely means that employees who pursue their employment claims administratively will not be able to recover compensatory and punitive damages, and may choose to pursue those claim in federal court instead.

The Parkers bought the next-door parcel in 2003.  A 2006 survey showed that the strip of land actually belonged to the Parkers, and in 2008, the Parkers erected a fence along the recorded boundary.  Engel sued in 2009, alleging that he aquired title by adversely possessing the property in question. 

The Parkers moved for summary judgment, arguing that the time to bring an adverse possession claim expired in 2004.  Engel argued that the Wis. Stat. 893.33(5) owner-in-possession exception applied — “[The statute of limitations] does not apply to any action commenced or any defense or counterclaim asserted, by any person who is in possession of the real estate involved as owner at the time the action is commenced.” – barring the application of the statute of limitations.  The court agreed, dismissing the Parkers’ argument that Engel was not in possession of the property at the time the suit was filed, as the language of the statute seems to require.

To support its decision, the court cited language from O’Neill v. Reemer, 2003 WI 13, 259 Wis. 2d 544, 657 N.W.2d 403:

It is illogical to construe a statute with a purpose of eliminating stale claims in such a way that after 50 years of staleness a right of ownership in record title is resurrected. In adverse possession cases, it is the record title to the property that has lain dormant and stale. At the end of the applicable adverse possession period, title vests in the adverse possessor and the record owner’s title is extinguished.

More convincing for the court was the similar analysis in Herzog v. Bujniewicz, 32 Wis. 2d 26, 31, 145 N.W.2d 124 (1966), leading to the conclusion that:

Once title is secured by adverse possession the possessor need not keep the flag of hostility waving forever. 

Because it was undisputed that Engel adversely possessed the property from 1954 to 1974, he was entitled to the owner-in-possession exception.