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One year after lame-duck laws passed, complications persist as taxpayer bill hits $2.1 million
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LAME-DUCK LAWS ONE YEAR LATER

One year after lame-duck laws passed, complications persist as taxpayer bill hits $2.1 million

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A year after former Republican Gov. Scott Walker signed sweeping legislation meant to curb the power of his Democratic successor, Wisconsin has yet to see a final resolution in the courts as the taxpayer cost climbs above $2.1 million.

In addition to the cost for lawyers in the ongoing litigation, several lawsuits — including everyday personal injury cases — remain unresolved because of an impasse between the Department of Justice and the Legislature’s finance committee over how to reach settlements under the laws.

After a year of court battles and concerns over whether the laws work in practice, Republicans argue the predicted fallout from the laws was overstated.

“Critics of the the extraordinary session claimed the end of democracy in the state,” Vos said, claiming democracy in Wisconsin is “alive and well.” “One year later, Wisconsin has a state budget, approved by the Republican legislature and signed into law by a Democratic governor.”

But Democrats and other critics argue the laws were simply meant to take power away from an incoming Democratic administration. They say the laws have proved clunky, producing myriad unintended consequences that have thrown a wrench in the operation of state government.

While Democratic Attorney General Josh Kaul acknowledged “we’ve managed to avoid a disaster so far,” he said the laws have made it harder to resolve cases and reduced funding for public safety.

Esenberg mug

Esenberg

The GOP-passed laws, passed in a lame-duck session after Democrats won all statewide elections in November 2018 but before they took office in January, are the subject of a number of lawsuits that have come before the federal judiciary or Wisconsin Supreme Court.

So far, the laws have survived one major technical challenge brought by the League of Women Voters. But a major separation-of-powers case brought by the Service Employees International Union, which could deal a blow to all or parts of the laws, has yet to be decided by the state’s high court.

The laws limit Kaul’s ability to control the state’s participation in lawsuits, targeted Evers’ power to run the Wisconsin Economic Development Corp. and limited early voting hours. A federal judge earlier this year struck down the voting hours provision and the laws allowed for Evers to appoint his own economic development director in October.

The laws also require Kaul to get permission from a GOP-controlled legislative committee to settle certain lawsuits, and they guarantee that the Legislature can intervene in many cases using its own attorneys rather than those from the state Department of Justice.

Vos mug

Vos

A year after their passage, Democrats continue to say the laws were shortsighted and punitive, while Republicans say they’re doing everything in their power to make them work smoothly and that they place more lawmaking authority in the rightful hands of the Legislature as opposed to the executive branch.

“I think we should all agree the Legislature should make laws, not administrative agencies,” said Rick Esenberg, president of the conservative Wisconsin Institute for Law & Liberty. “Those were all good government reforms.”

Effect on personal injury cases

However, the laws have had unintended consequences far beyond the Capitol, affecting personal injury cases in addition to the major state litigation the Republican Legislature wants to influence.

Aspects of some personal injury cases are now delayed pending review by the state’s Joint Finance Committee. Additionally, a number of other settlements that could net the state millions of dollars are awaiting approval from the Joint Finance Committee. The committee did manage to approve one $350,000 settlement this fall because the involved parties agreed to disclose the terms.

Lawmakers on the finance committee, to which Republicans gave oversight authority over the DOJ settlement process, haven’t been able to reach an agreement with the Department of Justice over a confidential process for members to review and approve the lawsuits.

“It’s creating a hardship for personal injury clients,” said Todd McEldowney, a Rhinelander-based personal injury attorney.

McEldowney represents Ashley Krall, the victim of a car crash. The state, through its Medicaid program, paid some of her medical bills. As a result, the state might be eligible for repayment from the settlement, once it is reached with the party responsible for the crash.

Previously, the state would have frozen some of the settlement money to cover the medical costs, but allow the plaintiff to keep some of that portion to pay her lawyer and other litigation costs, about $2,500. But in Krall’s case, the state is not allowing her to keep that amount, which could result in her having to pay her lawyer out of pocket.

Kaul mug

Kaul

That’s because the new laws prohibit the state from making any compromise in some lawsuits without the Joint Finance Committee’s approval. So the state Department of Justice is seeking to recover the full amount of the medical bills without subtracting the roughly $2,500 worth of fees.

McEldowney said he expected resolution of the matter in August, but it’s still pending.

“It isn’t fair that we do the work which benefits BadgerCare yet Ashley is being asked to pay the attorney’s fee for its collection,” McEldowney said.

In an interview, Kaul said the DOJ’s stance in such cases is a “direct result” of the new laws because the DOJ can’t enter into a settlement agreement without approval from the Joint Finance Committee. The DOJ acknowledged cases such as Krall’s “likely are not covered” by the new laws, but it still wants committee approval for such cases because it “will remove any doubt as to the validity” of a settlement. A DOJ spokeswoman said the department needs JFC approval to ensure the settlements don’t fall through.

“There’s been a hangover of the lame duck,” said Senate Minority Leader Jennifer Shilling, D-La Crosse. “We have seen now why that lame-duck legislation was very shortsighted. It was not very thought out.”

Republicans blame Kaul and the DOJ for failing to provide the necessary information on cases in order to review them. Kaul wanted them to sign a nondisclosure agreement for them to do so confidentially, but they objected, arguing it was unfair since prior attorneys general shared confidential information with the governor’s office for decades without making them agree to secrecy.

“The one time DOJ submitted the details of a settlement for JFC review, the committee met within weeks and approved the request,” said finance committee co-chairman Rep. John Nygren, R-Marinette. “The committee is ready and willing to meet again to review proposed settlements, but cannot do so if DOJ does not submit settlement information for review.”

Vos blamed Kaul for being “derelict in his duty” and said the Legislature has done everything it can to make the laws work seamlessly.

But Kaul rejected such thinking, maintaining that confidentiality is often a requirement to successfully resolve lawsuits and that lawmakers have a responsibility to accept DOJ’s suggestions for a process moving forward or provide a workable alternative.

“A party may not make a settlement offer if it knows it’s going to be public,” said Kaul, who has criticized the laws for failing to anticipate such complications. “The longer we wait to have an effective process in place, the more likely it is there’s going to be problems that result from that failure.”

Michael Leffler, an attorney who represents a client in a personal injury case affected by the laws, said they could throw a wrench in settlement negotiations.

If he and an opposing party reached a proposed settlement agreement, he said any delay in action by the Joint Finance Committee could push him into settling without knowing whether lawmakers will approve.

Any wavering could further delay a case by forcing the parties to go to trial. Delays in the resolution of settlements of cases involving Medicaid lengthen the amount of time it takes for the state or federal government to be reimbursed, and could put victims in a financial pinch if their case isn’t resolved in a timely fashion.

“It just is not an efficient way to handle cases,” Leffler said.

Lame-duck legal costs

So far, the governor and Legislature have racked up at least $2.1 million in legal fees in cases challenging the extraordinary session laws on a number of fronts.

Evers’ attorneys have billed the state more than $500,000 so far, while the Legislature’s attorneys have billed at least $1.6 million.

In the League of Women Voters challenge, Evers hired Madison-based firm Pines Bach for representation to the tune of at least $126,777, according to legal invoices provided by the governor’s office. Records provided by the Legislature showed it was billed at least $405,300 by Chicago-based firm Troutman Sanders for representation in the case.

The League of Women Voters claimed the laws were unconstitutional because the Legislature allegedly acted during a legislative session not specifically sanctioned by law or the state constitution.

In June the conservative-controlled Wisconsin Supreme Court sided with the GOP-controlled Legislature and upheld the laws.

In an ongoing separation-of-powers challenge brought by the Service Employees International Union and others, the Legislature has been billed at least $1 million chiefly by the Troutman Sanders firm, though Husch Blackwell also billed about $23,000.

Evers has been billed at least $371,000 in that case by Pines Bach. The governor was also billed nearly $14,000 for the Lawton and Cates firm to represent the Elections Commission in a case, and the Strang, Patteson firm billed him about $2,500 for a special counsel appointment.

Additionally, the Legislature has been billed at least $205,000 for representation by Troutman Sanders in a challenge by the Democratic Party of Wisconsin. The Von Briesen & Roper firm has billed the Legislature at least $24,000 for representing the Joint Finance Committee in the review of settlements.

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