Landmark Legal Cases

The attorneys at Cannon and Dunphy have a long history of successful settlements, verdicts and judgments for their clients. However, a second component necessary for making a successful law firm is the active participation in developing the law. One way in which law can be developed is through the appellate courts. Once a trial court makes a decision on a case, the party has a right to appeal that decision to the Wisconsin Court of Appeals and the Wisconsin Supreme Court. The decisions of the Court of Appeals and Supreme Court can both define and create law (known as common law). Cannon & Dunphy S.C. takes a very active role in this process with both their clients’ cases and as an invited friend of the court (known as an amicus curiae). Since 1995, Cannon and Dunphy has participated in over 64 decisions at the Court of Appeals and Supreme Court.

Some of the appellate successes of Cannon & Dunphy S.C. include the following decisions published in the Official Wisconsin Reporter and Northwest Reporter:

• Kontowicz v. American Standard Ins. Co.,
  2006 WI 48, 290 Wis. 2d 302, 714 N.W.2d 105.
  In this case, our client’s spinal cord was severed and she was rendered a quadriplegic as a result of an automobile accident caused by the negligence of American Standard’s 16-year-old insured. Immediately prior to the crash, he was operating the Pontiac Firebird that his parents bought him at an estimated speed of 89 mph in a 35 mph zone. He crashed into the rear-end of our client’s car, and pushed her off of the road and into a utility pole. Her spinal cord was severed as a result of the impact. American Standard’s liability limits were only $500,000. Even though American Standard concluded within one week of the crash that it should pay those limits once it confirmed our client’s injuries, it did not pay those limits until nearly 16 months later. After American Standard finally paid its limits, we brought a motion before the circuit court seeking to recover interest from American Standard pursuant to Wis. Stat. § 628.46, the “timely payment of claims statute,” based on its failure to timely pay our client’s claim. That statute requires insurers to pay a claim within thirty days of being presented with proof of loss or equivalent evidence of such loss. Where an insurance company fails to timely pay a claim absent reasonable proof to deny its responsibility, interest starts running at the rate of 12% per year and continues to run until such time as the insurer finally pays the claim. In a case of first impression, the Wisconsin Supreme Court agreed with us that § 628.46 is not limited to first-party claims but rather applies equally to third-party claims. The Wisconsin Supreme Court accordingly upheld the circuit court’s assessment of interest against American Standard.

• Hunt v. Clarendon National Insurance Service, Inc.,
  2005 WI App 11, 278 Wis. 2d 439, 691 N.W.2d 904.
  In this case, our ten-year old client was struck by a car and injured after she was dropped off on the corner by her school bus. Under the “drop-and-go” policy of the defendant school bus company, school children who reside within the City of Milwaukee are dropped off by the bus on the corner and told to wait until the bus departs to cross the street. Under this policy, the defendant school bus company and its drivers do not assist the children in crossing the street. By contrast, in rural areas, school buses do not drive away after dropping off children but rather remain at the stops so that the drivers can assist the children in crossing in front of the bus. Once the bus pulled out into the intersection, our client started to cross the street behind the bus in the crosswalk. Unfortunately, the bus stopped in the intersection to make a left turn, and obstructed our client’s view of oncoming traffic. Although the bus driver saw an approaching vehicle, he did not honk his horn or do anything to attempt to warn the approaching motorist of the presence of our client, or to warn our client of the approaching car. We argued that the defendant school bus company is a “common carrier,” and, accordingly, was required to exercise the highest degree of care. We argued further that the defendant’s “drop-and-go” policy was inherently deficient and in violation of its “common carrier” duty of care. The circuit court disagreed with us, and refused to instruct the jury as to the defendant’s “common carrier” status and duties. On appeal, we successfully obtained a new trial. The Wisconsin Court of Appeals agreed with us that school buses are “common carriers,” and therefore required to exercise the highest degree of care. Upon retrial, we obtained a favorable verdict against the school bus company on behalf of our client.

• Phelps v. Physicians Insurance Company of Wisconsin,
  2005 WI 85, 282 Wis. 2d 69, 698 N.W.2d 643.
  In this case, our client was pregnant with twins and hospitalized for observation due to some bleeding. In the early morning hours, she developed suprapubic pain. During this time, a first year medical resident evaluated her. Although the resident recognized in his differential diagnosis that one of the causes of her pain could be a placental abruption, he nevertheless disappeared for several hours without doing a proper diagnostic work-up. Several hours later, to her sheer horror, she felt one of the twin’s feet coming out of her. An emergency C-section was done, but the baby could not be revived, although the other twin was saved. We filed a medical malpractice lawsuit against the resident and hospital. With respect to the resident, we argued that he did not meet the definition of “health care provider” set forth in ch. 655 of the Wisconsin Statutes because he was unlicensed, and consequently, he was not entitled to the protection of the statutory medical malpractice damage cap set forth in Wis. Stats. §§ 893.55(4) and 655.017. In a case of first impression, the Wisconsin Supreme Court agreed with our statutory interpretation, and ruled that the noneconomic damage cap does not apply to unlicensed first year medical residents.

• Pitts v. Revocable Trust of Knueppel,
  2005 WI 95, 282 Wis. 2d 550, 698 N.W.2d 761.
  In this case, our client was injured in an automobile accident. We settled with the liability insurer for the at-fault driver, whereby the liability insurer agreed to pay its full policy limits. We gave notice of the policy limits tender to our clients’ underinsured motorist (“UIM”) insurer, as required under her policy. Our client’s UIM insurer elected to substitute its funds in place of the liability insurer. Thereafter, the defendant offered to pay an additional amount over-and-above the amount of its liability limits in settlement of all remaining claims against it. We gave notice of this settlement offer to our client’s UIM insurer, but they refused to either allow us to accept this offer in return for a full release of the defendant, or else substitute its payment in place of the defendant’s payment. Essentially, our client’s UIM insurer sought to “hold us hostage” and force us to go to trial against the defendant, when we were ready and willing to settle with the defendant. It argued that it did not have to either consent to this settlement or else pay in place of the defendant, because that election only applies to payment of liability limits. In a case of first impression, the Wisconsin Supreme Court agreed with us that a UIM insurer must make an election and either consent to a settlement or else substitute an amount in place of the defendant’s offered payment.

• Kriefall v. Sizzler USA Franchise, Inc.,
  2003 WI App. 119, 265 Wis. 2d 476, 665 N.W.2d 417.
  This case involved an outbreak of E. coli O157:H7 at the Layton Avenue Sizzler Restaurant in Milwaukee, Wisconsin in the summer of 2000. Many persons who dined there were sickened. Our clients’ three year old daughter contracted E. coli O157:H7 as a result of dining there, and ultimately died as a result. The producer of the meat confirmed by state and federal investigators as the cause of the E. coli O157:H7 outbreak brought a summary judgment motion seeking dismissal of all claims against it based on alleged federal preemption. Essentially, the meat producer argued that because the activities and processes at meat plants are governed by the Federal Meat Inspection Act and its implementing regulations, meat producers are immune from any civil liability to consumers of their meat. Although the trial court agreed with the defendant’s position, our firm, along with other lawyers representing injured consumers, obtained a reversal on appeal and a reinstatement of our claims against the meat producer. In a resounding victory for Wisconsin consumers, the Wisconsin Court of Appeals agreed with our position that the Federal Meat Inspection Act does not insulate meat producers from civil liability for injuries caused by their adulterated meat products.

• Bittner v. American Honda Motor Co., Inc.,
  194 Wis. 2d 122, 533 N.W.2d 476 (1995).
  This case involved a 3-wheel ATV accident which left our client with profound brain injuries. We sought to hold Honda, the manufacturer of the subject ATV, responsible for our client’s roll-over accident and resulting injuries, on the basis that its 3-wheel ATV design was inherently unstable and known by Honda to be prone to tipping over during operation. During the trial, the circuit court, over our strenuous objection, permitted the lawyers for Honda to introduce so-called “comparative risk” evidence. That is, Honda was allowed to argue that its 3-wheel ATV design was not unreasonably dangerous, because other products and activities, such as sky diving, aviation, and playing football, are more likely statistically to result in death or injuries. The Wisconsin Supreme Court agreed with us that such “comparative risk” evidence is irrelevant and inadmissible in a products liability case. The Wisconsin Supreme Court granted us a new trial based on the trial court’s erroneous admission of such evidence. The case ultimately settled prior to the retrial.

• Schulte v. Frazin,
  176 Wis. 2d 622, 500 N.W.2d 305 (1993).
  This case arose out of a medical malpractice action against a neurosurgeon, in which our client was paralyzed when the surgeon drilled into her spinal cord. We settled this case prior to trial for $2,460,000. We then brought a motion to extinguish the subrogation claim of our client’s health insurer, on the basis that our client was not “made whole” by the settlement, that is, that the amount of the settlement was less than her total damages. Under Wisconsin law, group and private health insurers are not entitled to be repaid for health expenditures out of a tort settlement or recovery unless and until their insured is “made whole” by the settlement or recovery. The circuit court then conducted a “made whole” hearing, after which it agreed with us and determined that our client was not “made whole” by the settlement. Nevertheless, our client’s health insurer attempted to continue the lawsuit against the defendant surgeon and his liability insurer in an attempt to recover its health expenditures. Because the defendant surgeon and his insurer had required us to indemnify them against any subrogation claims, our client’s health insurer was therefore attempting to recover its payments despite that fact that our client was not “made whole.” We accordingly sought dismissal of their subrogation claim. The Wisconsin Supreme Court agreed with us that, where there is a settlement prior to trial under circumstances where the plaintiff claims that he or she has not been made whole by the settlement, the circuit court should hold a “made whole” hearing where the health insurer has a right to participate and argue that the settlement made its insured whole. If the circuit court nevertheless determines that the settlement did not make the plaintiff whole, the health insurer is not entitled to recover its payments from either the plaintiff or the defendant.
• Heritage Farms v. Markel Ins.,
  2012 WI 26, 339 Wis. 2d 125, 810 N.W.2d 465.
  In this case, an out-of-control campground fire destroyed nearly 600 acres of our clients’ mostly hardwood forest. Following a trial, a jury determined that the fire had been negligently started by a man hired by the campground and awarded compensatory damages. Following the verdict, we sought to recover actual attorney’s fees as well as double damages under Wis. Stat. § 26.21(1). The circuit court denied the request, agreeing with the defendant that the statutory penalty provision only applied to forest fires caused by railroads. The Court of Appeals affirmed.Heritage Farms, Inc. v. Markel Ins. Co., 2008 WI App 46309 Wis.2d 217, 747 N.W.2d 762. The Supreme Court reversed and remanded, holding that the statute was not limited to railroads.Heritage Farms v. Markel Ins., 2009 WI 27, 316 Wis.2d 47, 762 N.W.2d 652. On remand, the circuit court granted our motion for actual attorneys’ fees but denied the request for double damages, ruling that an award of double damages is discretionary, not mandatory, and that the facts did not warrant the imposition of such a penalty. The Court of Appeals affirmed.Heritage Farms v. Markel Ins., 2011 WI App 12, 331 Wis.2d 64, 793 N.W.2d 896. The Supreme Court reversed, holding that “pursuant to § 26.21(1), if it is determined that the owner’s property was injured or destroyed by a forest fire that occurred through willfulness, malice, or negligence, then the property owner is entitled to double damages as a matter of course.” The Supreme Court also held that our clients were entitled to 12 percent interest from the date of the verdict in 2006, even though the defendants’ “liability for double damages was not firmly established” until the supreme court’s second decision.
• Hegarty v. Beauchaine,
  2006 WI App 248, 297 Wis.2d 70, 727 N.W.2d 857.
  In this case, our client, Sarah Hegarty, developed severe abdominal pain, nausea and vomiting and was rushed to Children’s emergency room and later admitted to Children’s Hospital. From the time of her admission at 8:30 p.m. until 7:30 a.m. the next morning, she was only seen by a first-year medical resident who was not yet licensed to practice medicine. The resident diagnosed Sarah with constipation, called her a “whiner” and did not conduct a surgical consultation. By the time Sarah was taken to surgery that afternoon, she had a bowel volvulus with complete bowel infarction, meaning her small bowel had twisted, cutting off the blood supply. Over the next two years, Sarah underwent 89 surgical procedures, including two organ transplants. She died on March 16, 1998, at the age of 17. We filed a medical malpractice lawsuit against setting forth survival claims on behalf of her estate and wrongful death claims on behalf of her parents. Following a three-week trial, the jury returned a verdict in favor of Sarah’s estate and the Hegartys, awarding almost $17.4 million. Judgment was entered in favor of the plaintiffs in the amount of $19,002,754.29. In affirming the judgment, the court of appeals held that the statutory cap on noneconomic damages in §893.55(4) did not apply to a first-year unlicensed medical resident, and that there was no damage cap that applied to the award to Sarah’s parents for their loss of her pre-death society and companionship. The court of appeals also affirmed various evidentiary and insurance coverage rulings by the circuit court, the form of the special verdict and the instructions given to the jury.
• Brew City Dev. Group LLC v. Ferchill Group LLC,
  2006 WI 128, 297 Wis.2d 606, 724 N.W.2d 879.
  In 1996, Pabst Brewing Company closed its Milwaukee brewery consisting of 27 buildings. Our client, a local real estate investor, and his company, Brew City Development Group, acquired the rights to purchase the property, and agreed to assign that right to various commercial investors in exchange for title to three of the historic buildings and an ownership interest in the development. After assigning his purchase rights, our client was not given title to the buildings and was pressured to sell his interest in the development. We filed suit on our client’s behalf, alleging both contract and tort claims against several defendants. The circuit court dismissed the case. The court of appeals reversed in part and affirmed in part, and permitted both contract and tort claims to proceed.Brew City Dev. Group, LLC v. Ferchill Group LLC, 714 N.W.2d 582, 2006 WI App 39, 289 Wis.2d 795. The supreme court held that: (1) the economic loss doctrine—which generally precludes tort claims in a contract case—did not apply because the conduct giving rise to Brew City’s malicious injury to business claim and the resulting damages were different than those in its breach of contract claim; (2) §183.0402 did not grant the individual defendants, who were members of the defendant limited liability companies, immunity for any conduct that fell outside the scope of their role as members; and (3) the intra-corporate conspiracy doctrine did not preclude Brew City’s conspiracy claims. The opinion made new law in Wisconsin. Ultimately, we obtained title to the historic buildings for our client as well as a monetary recovery.

In addition to these cases, members of our firm have also been active on the amicus curiae brief committee of the Wisconsin Association for Justice, and have authored or co-authored more than 30 briefs submitted to the Wisconsin Court of Appeals and Wisconsin Supreme Court in cases involving significant issues of statewide importance