Recently, the Wisconsin legislature dramatically amended key provisions of the state’s civil procedure laws. The new rules (which are adopted by statute in Wisconsin) will work major changes in the conduct of civil litigation in Wisconsin state courts. Many of the new rules were designed to reduce litigation costs, and were widely supported by business interest groups, including Wisconsin Manufacturers & Commerce and the Wisconsin Civil Justice Council. Most notable are the changes to the rules on civil discovery and certain statutes of limitations. Those changes are outlined here.
The new laws on discovery apply to actions filed on or after July 1, 2018. The changes to the statutes of limitations were included in the same legislative act – 2017 Wisconsin Act 235 – as the changes to the discovery rules. However, the new statutes of limitations took effect as of April 5, 2018.
Scope of Discovery
Wisconsin’s law on the allowable scope of discovery has been revised so that it now mirrors the equivalent rule in the Federal Rules of Civil Procedure. The new law provides that parties may obtain discovery regarding any relevant, nonprivileged matter, that is proportional to the needs of the lawsuit. In determining the proportionality, the parties and the court are to take the following into consideration:
- the importance of the issues at stake in the action;
- the amount in controversy;
- the parties’ relative access to relevant information;
- the parties’ resources;
- the importance of the discovery in resolving the issues; and
- whether the burden or expense of the proposed discovery outweighs its likely benefit.
Wis. Stat. § 804.01(2)(a). The federal rule on which this new Wisconsin law is based (Fed. R. Civ. P. 26(b)(1)), was adopted to curtail discovery overuse. It provides a proportionality analysis for determining when discovery requests are wasteful or unnecessary.
The new Wisconsin law also incorporates the proportionality analysis into the factors a court must weigh when considering a motion to limit discovery. The statute provides that the court may limit discovery if it finds:
- the discovery is cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive; or
- the burden or expense of the proposed discovery outweighs its likely benefit or is not proportional to the claims and defenses at issue considering the needs of the case, the amount in controversy, the parties’ resources, the complexity and importance of the issues at stake in the action, and the importance of discovery in resolving the issues.
Wis. Stat. § 804.01(2)(am).
Numerical and Temporal Limits on Discovery
Under the revised Wisconsin law, parties are now subject to the same numerical and temporal limitations on depositions and interrogatories as required under the federal rules (Fed. R. Civ. P. 30, 33). As there were no limitations under the previous law, this is a significant change in civil discovery. Unless otherwise ordered by the court, parties are now limited to 10 depositions, each not to exceed 7 hours, and 25 interrogatories. Wis. Stat. §§ 804.045, 804.08(1)(am).
Wisconsin also added a time limitation on requests for production of documents. In addition to other limitations already in place, requests for production of documents now must be limited to 5 years prior to the accrual of the cause of action. This five-year limitation does not apply to patient health care records, vocational records, educational records, or other similar records. Wis. Stat. § 804.09(2)(a)3.
Limitations on Production of Certain Electronically Stored Information
Discovery of electronically stored information (ESI) – such as emails, texts, documents (drafts, final versions, etc.), and metadata – has become an increasingly expensive and time-intensive part of litigation. Wisconsin’s new law restricts discovery on certain types of ESI. Unless a party shows substantial need and good cause based on the proportionality analysis discussed above, parties are no longer required to produce the following:
- data that cannot be retrieved without substantial additional programming or without transforming it into another form before search and retrieval can be achieved;
- backup data that are substantially duplicative of data that are more accessible elsewhere;
- legacy data remaining from obsolete systems that are unintelligible on successor systems; and
- any other data that are not available to the producing party in the ordinary course of business and that the party identifies as not reasonably accessible because of undue burden or cost.
Wis. Stat. § 804.01(2)(e)1g. If a party shows that the data is “not reasonably accessible because of undue burden or cost,” the statute provides that the court may order discovery of the ESI only if the party requesting the information shows good cause based, again, on the proportionality analysis and that the same information cannot be obtained in a less burdensome or expensive manner. Wis. Stat.
§ 804.01(2)(e)1g.d.
Mandatory Disclosure of Third Party Litigation Funding
Third party litigation funding (TPLF) is a financial tool in which third parties invest in a lawsuit. The third party pays the litigant or his or her counsel in exchange for a contingent interest in proceeds from the litigation. While this controversial financial tool continues to grow in popularity, so have calls for more transparency. Wisconsin’s new statute addresses this.
In any action filed on or after July 1, parties must disclose, without waiting for a request for discovery of such, “any agreement under which any person, other than an attorney permitted to charge a contingent fee representing a party, has a right to receive compensation that is contingent on and sourced from any proceeds of the civil action, by settlement, judgment, or otherwise.” Wis. Stat. § 804.01(2)(bg). However, parties may agree, or a court may order, that this information need not be disclosed. Notably, the statute does not mandate third-party funding where the party providing the funding does not have a right to receive compensation contingent on or sourced from the lawsuit.
Automatic Stay of Discovery
Wisconsin law has now codified the practice by some courts in some cases to stay discovery pending a ruling on a motion or dismiss, motion for judgment on the pleadings, or a motion for a more definite statement. Because a ruling on one of these motions could dismiss the action and make moot any discovery request, the new law requires all discovery to be stayed for 180 days after the filing of the motion or until the court has ruled on the motion, whichever is sooner. Wis. Stat. § 802.06(1)(b). The court may make an exception to this rule if it finds good cause that a particular type of discovery is necessary during the pendency of the motion.
Statutes of Limitations
Wisconsin has cut in half the time limitation for filing a lawsuit based on several causes of action. The statute of limitations is now 3 years for a cause of action based on:
- injury to the character or rights of another, where the action is not based on a contract;
- fraud; and
- any other cause of action created by statute if a different limitation is not already provided for in the law.
Wis. Stat. §§ 893.53, 893.93(1m).
Wisconsin has also modified its statute of repose, which is the default time limit for filing an action based on a deficiency or defect in an improvement to real property. The statute of repose is similar to a statute of limitations. But the deadline to file an action subject to a statute of repose is based on the passage of time after substantial completion of improvement to real property instead the passage of time after an injury.
The new law decreases by 3 years the time period for bringing an action. Now, an action based on an injury as a result of a deficiency or defect in an improvement to real property must be brought within seven years – instead of 10 years – after substantial completion of the improvement. This is called the “exposure period.” The exposure period can be increased to 10 years if the injury occurs in years 5 through 7. Wis. Stat. §§ 893.89(1), (3)(b).
Conclusion
Some of the changes to Wisconsin’s civil procedure rules bring them into harmony with equivalent rules in federal courts and will simplify litigation practice in Wisconsin’s courts. Nonetheless, some of the changes are significant departures from procedural rules that have long been in effect in Wisconsin. And there are other rules, practices, and procedures in Wisconsin that differ significantly from those in other states and in federal courts. If you have questions about these changes or other aspects of practice or procedure in Wisconsin, or for other questions about Wisconsin law, please contact us.
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