Water Splash Reveals a Glaring Omission in Wisconsin's Service-of-Process Rules, Which Ought To Be Fixed

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Today’s unanimous U.S. Supreme Court decision in Water Splash, Inc. v. Menon, 581 U.S. ___, No. 16-254, points out a glaring omission in Wisconsin’s service-of-process rules that ought to be fixed, so that Wisconsin plaintiffs are not unnecessarily put at a disadvantage when suing overseas defendants in state court. Justice Samuel Alito’s decision, reversing the Texas Court of Civil Appeals, held that Article 10(a) of the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil and Commercial Matters, Nov. 15, 1965 (Hague Service Convention), 20 U. S. T. 361, T. I. A. S. No. 6638, authorizes service of process, including summons, by mail in any country that is party to the Hague Service Convention and does not object to mail service. Canada, where the respondent Tara Menon lives, does not object, so the Supreme Court upheld the judgment that Water Splash obtained against her by default when she refused to appear in Texas. The Texas courts had not determined whether Texas law allows service by mail, so the Court sent the case back to allow them to make that call.

Wisconsin’s state law clearly precludes service by mail in this situation. Wis. Stat. § 801.11 requires personal or substituted service on defendants or their agents, unless the plaintiff can be served by publication and mailing under § 801.11(1)(c). That statute requires the plaintiff first to attempt personal or substituted service “with reasonable diligence,” which certainly takes time, and service by publication in a foreign country is itself a dicey proposition from the plaintiff’s perspective. How do you do it, and is such publication constitutionally effective?
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Midland Funding Highlights Peculiar Feature of Wisconsin's Statute-of-Limitations Law

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The U.S. Supreme Court’s decision today in Midland Funding, LLC v. Johnson, 581 U.S. ___, No. 16-348, draws attention in passing to a peculiar feature of Wisconsin law on the effect of statutes of limitations. The 5-3 decision, in an opinion by Justice Stephen Breyer, holds that a debt collector that files a proof of claim in bankruptcy when collection is barred by a statute of limitations does not thereby violate the Fair Debt Collection Practices Act’s prohibitions on asserting any “false, deceptive, or misleading representation,” or using any “unfair or unconscionable means” to collect a debt. 15 U.S.C. §§ 1692e, 1692f. In reversing the Eleventh Circuit’s contrary holding, the Court agreed with all the other federal courts of appeals that have decided the issue, including the Seventh Circuit. See Owens v. LVNV Funding, LLC, 832 F.3d 726 (7th Cir., 2016). Owens involved cases from Indiana and Illinois, whose common law holds (like that of the majority of states) that the running of a statute of limitations only bars an action to collect but does not extinguish the claim. Id. at 731.

Wisconsin is different, at least on the surface. As Justice Breyer noted in his Midland Funding opinion, slip op. at 3, Wis. Stat. § 893.05 provides that “[w]hen the period within which an action may be commenced . . . has expired, the right is extinguished as well as the remedy.” The statute codifies Wisconsin’s common law. See Maryland Cas. Co. v. Beleznay, 245 Wis. 390, 14 N.W.2d 177 (1944). Nevertheless, the practical significance of Wisconsin’s minority view on extinction of debt as well as remedy is difficult to assess, for the statute of limitations is an affirmative defense that must be raised in an answer or motion, Wis. Stat. §§ 802.06(2)(a)9., 802.06(8)(b), and failure to raise it waives it. See Johnson v. Heintz, 73 Wis. 2d 286, 298-99, 243 N.W.2d 815 (1976).
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Wisconsin’s Supreme Court: Contractual Waivers of Civil Jury Trial Are Enforceable

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Last year the Wisconsin Court of Appeals threw businesses a curveball when it held that a contractual waiver of the right to a jury trial was unenforceable.

The holding of the case, Parsons v. Associated Banc-Corp., 2016 WI App 44, 370 Wis. 2d 112, 881 N.W.2d 793, seemed at odds with long-settled case law and with principles concerning freedom of contract.

But the Supreme Court has now straightened the court of appeals’ pitch. In a 4-2 decision issued last week, it reversed the lower court. See Parsons v. Associated Banc-Corp., 2017 WI 37. Justice Annette Ziegler wrote for the majority; Justice Ann Walsh Bradley wrote a dissent, in which Justice Shirley Abrahamson joined; Justice Daniel Kelly did not participate.

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A Softer, Gentler Seventh Circuit Reconsiders “Substantial Compliance” under Rule 11

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Those who practice regularly before the U.S. Court of Appeals for the Seventh Circuit know that the court has not been reluctant to punish a misbehaving lawyer.

So the court’s recent decision in Riffner v. PNC Bank, No. 15-2142 (7th Cir. Mar. 10, 2017), might come as a bit of a surprise. Unlike (apparently) all the other circuits that have considered the issue, the Seventh Circuit has long allowed “substantial compliance” with Rule 11’s requirement that the party seeking sanctions serve, but not file, its motion and wait 21 days before filing, to give the offending party a chance to back down.

In this case, however, the court, in an opinion written by Judge David Hamilton (joined by Chief Judge Diane Wood), while expressly declining to reconsider adherence to the court’s position on “substantial compliance,” reversed the district court’s imposition of sanctions because the letters that the moving party sent did not substantially comply with the rule.

Judge Richard Posner dissented from the majority opinion and accused his colleagues of being “enamored” with “legal technicalities” or of being “reluctant to punish misbehaving lawyers.”

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Seventh Circuit Explains Disclosure of Hybrid Witnesses under Fed. R. Civ. P. 26(a)(2)(C)

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The Seventh Circuit’s recent decision in Indianapolis Airport Authority v. Travelers Property Casualty Co. of America, No. 16-2675 (7th Cir. Feb. 17, 2017), written by Judge David Hamilton, is one for civil litigators to take note of. It appears to be the first time the Seventh Circuit has used Federal Rule of Civil Procedure 26(a)(2)(C). That subsection, which was part of the Rule’s 2010 amendments, governs the disclosures required for “hybrid witnesses”—that is, witnesses not retained or specifically employed to provide expert testimony, but who have personal knowledge and offer both fact- and expert-opinion testimony. (The court has mentioned Rule 26(a)(2)(C) previously, but never has applied it.)

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