Ferdon v. Wisconsin Patients Comp. Fund, No. 2003AP988.

• Court: United States State Supreme Court of Wisconsin
• Citation: 701 N.W.2d 440,284 Wis.2d 573,2005 WI 125
• Docket Number: No. 2003AP988.
• Parties: Matthew FERDON, by his Guardian ad Litem, Vincent R. Petrucelli, Cynthia Ferdon and Dennis Ferdon, Plaintiffs-Appellants-Petitioners, v. WISCONSIN PATIENTS COMPENSATION FUND, Medical Protective Company, Michael J. Brockman, M.D., and Aurora Health Care, Inc., d/b/a Bay West Gynecology & Obstetrics, Ltd., Defendants-Respondents, CONNECTICUT GENERAL LIFE INSURANCE COMPANY, a/k/a Cigna Insurance, f/k/a Healthsource Provident Administrators, Inc., a/k/a Healthsource Provident, and County of Oconto, Nominal-Defendants.
• Decision Date: 14 July 2005

284 Wis.2d 573
2005 WI 125
701 N.W.2d 440

Matthew FERDON, by his Guardian ad Litem, Vincent R. Petrucelli, Cynthia Ferdon and Dennis Ferdon, Plaintiffs-Appellants-Petitioners,
v.
WISCONSIN PATIENTS COMPENSATION FUND, Medical Protective Company, Michael J. Brockman, M.D., and Aurora Health Care, Inc., d/b/a Bay West Gynecology & Obstetrics, Ltd., Defendants-Respondents,
CONNECTICUT GENERAL LIFE INSURANCE COMPANY, a/k/a Cigna Insurance, f/k/a Healthsource Provident Administrators, Inc., a/k/a Healthsource Provident, and County of Oconto, Nominal-Defendants

No. 2003AP988.

Supreme Court of Wisconsin.

Oral argument April 26, 2005.

Decided July 14, 2005.

For the plaintiffs-appellants-petitioners there were briefs by Vincent R. Petrucelli and Petrucelli & Petrucelli, P.C., Iron River, MI, and oral argument by Marie A. Stanton and Merrick R. Domnitz.

For the defendant-respondent Wisconsin Patients Compensation Fund there was a brief by Steven P. Means, Christine Cooney Mansour, Roisin H. Bell and Michael Best & Friedrich, LLP, Madison, and oral argument by Steven P. Means.

284 Wis.2d 584

An amicus curiae brief was filed by Michael B. VanSicklen, Roberta F. Howell and Foley & Lardner, LLP, Madison, on behalf of Physicians Insurance Company of Wisconsin and the Property Casualty Insurers Association of America; and by Eric Englund, Madison, on behalf of the Wisconsin Insurance Alliance

An amicus curiae brief was filed by Timothy J. Muldowney, Jennifer L. Peterson and LaFollette Godfrey & Kahn, Madison, and Melanie Cohen, Madison, on behalf of the Wisconsin Medical Society and the American Medical Association.

An amicus curiae brief was filed by D. James Weis, Robert L. Jaskulski and Habush Habush & Rottier, S.C., Milwaukee, on behalf of the Wisconsin Academy of Trial Lawyers.

An amicus curiae brief was filed by Colleen D. Ball and Appellate Counsel, S.C., Wauwatosa, on behalf of Wisconsin Coalition for Civil Justice and Wisconsin Manufacturers and Commerce.

An amicus curiae brief was filed by Thomas M. Pyper, Cynthia L. Buchko and Whyte Hirschboeck Dudek S.C., Madison, on behalf of The Wisconsin Hospital Association, Inc. and The American Hospital Association.

284 Wis.2d 583

s 1. SHIRLEY S. ABRAHAMSON, C.J

This is a review of a summary order¹ of the court of appeals affirming a judgment of the circuit court for Brown County, Peter J. Naze, Judge. The judgment in this medical malpractice action was in favor the Wisconsin Patients Compensation Fund (Fund)² and against Matthew Ferdon.

284 Wis.2d 585

s 2. This medical malpractice action arose as a result of a doctor's negligence that injured Matthew Ferdon during birth. Despite surgeries, he has a partially paralyzed and deformed right arm

s 3. A jury awarded Matthew Ferdon $700,000 in noneconomic damages for injuries caused by medical malpractice and $403,000 for future medical expenses. The jury heard that Matthew Ferdon had a life expectancy of 69 years. Therefore, the jury's noneconomic damage award reflects an award of slightly more than $10,000 a year as the reasonable amount necessary to compensate Matthew Ferdon for having to live every day of his life with a partially functioning, deformed right arm.

s 4. After the verdict the Fund moved to have the noneconomic damages reduced pursuant to the limitation established in Wis. Stat. §§ 655.017 and 893.55(4)(d) (2001-02).³ The statutory limitation (sometimes called a cap) on the jury award means that Matthew Ferdon will have an award of approximately $5,900 a year as the reasonable amount necessary to compensate him for living with a partially functioning, deformed right arm.

s 5. The Fund also moved to have that portion of the award for future medical expenses exceeding $100,000 deposited into a state-administered fund pursuant to Wis. Stat. § 655.015.

s 6. The circuit court granted both of the Fund's motions. The court of appeals summarily affirmed the judgment of the circuit court, and this court granted review.

284 Wis.2d 586

s 7. Three questions are presented in the instant case:

s 8. First, is the $350,000 statutory limitation on noneconomic damages resulting from a medical malpractice injury in Wis. Stat. §§ 655.017 and 893.55(4)(d) constitutional?

s 9. Matthew Ferdon challenges the statutory limitation on noneconomic damages in medical malpractice actions on several grounds. He asserts that the mandatory statutory limitation (1) violates the equal protection guarantees of the Wisconsin Constitution;⁴ (2) violates the right to a trial by jury as provided in Article I, Section 5 of the Wisconsin Constitution;⁵ (3) violates the right to a remedy as provided in Article I, Section 9 of the Wisconsin Constitution;⁶ (4) violates the due process clause of the Wisconsin Constitution;⁷

284 Wis.2d 587

and (5) violates the separation of powers doctrine by infringing remittitur, a core judicial power, contrary to Article VII, Section 2 of the Wisconsin Constitution.⁸ The circuit court held the statutory limitation was constitutional; the court of appeals agreed.

s 10. We hold that the $350,000 cap (adjusted for inflation) on noneconomic medical malpractice damages set forth in Wis. Stat. §§ 655.017 and 893.55(4)(d) violates the equal protection guarantees of the Wisconsin Constitution. We therefore need not, and do not, address Matthew Ferdon's other constitutional challenges to the cap. We remand the cause to the circuit court for further proceedings not inconsistent with this opinion.

s 11. Second, if the statutory limitation is unconstitutional, is the Fund liable for payment of the amount of the jury award in excess of the statutory limitation? The Fund argues it need not pay the excess amount. Matthew Ferdon does not brief this question. The circuit court and court of appeals did not answer this question. We therefore remand this question to the circuit court so that the parties may be heard on it.

s 12. Third, is Wis. Stat. § 655.015, which requires the portion of the jury's award for future medical expenses exceeding $100,000 to be deposited into an account over which the Fund has control, constitutional?

284 Wis.2d 588

The parties argue the constitutionality of § 655.015 and the administrative rule implementing it, Wis. Admin. Code § Ins 17.26. The parties have not adhered to the procedure set forth in Wis. Stat. § 227.40 before challenging the constitutionality of the rule and have not considered whether the rule exceeds the authority delegated under § 655.015. Accordingly, we remand this question to the circuit court for the parties to comply with § 227.40 and address the validity of the rule, as well as to be heard on the constitutionality of the statute and rule.

s 13. Before continuing, it is important to highlight that this case is not about whether all caps, or even all caps on noneconomic damages, are constitutionally permissible. The question before this court is a narrow one: Is the $350,000 cap (adjusted for inflation and hereinafter referred to as the $350,000 cap) on noneconomic damages in medical malpractice cases set forth in Wis. Stat. §§ 655.017 and 893.55(4)(d) constitutional?

s 14. Medical malpractice litigation is a highly charged area of the law with ramifications not only for the injured party and the health care provider involved, but for all victims of medical malpractice, all health care providers, and the public. After a patient is injured, sometimes severely and permanently, a medical malpractice lawsuit pits the unfortunate patient and the patient's family against the health care provider in whom the patient and family had previously placed their trust. Physicians have contended that since the early- to mid-Nineteenth Century there has been a medical malpractice crisis pitting physicians against injured patients and their attorneys.⁹

284 Wis.2d 589

s 15. Emotion is not the only force at work in medical malpractice actions. Money is at stake for everyone involved, including the public. In the case of medical malpractice, interest groups representing every aspect of the delivery of health care are heavily involved in lobbying the legislature. A sampling of the interest groups includes hospital associations, insurance companies, doctor and nurse associations, patient advocates, and lawyer associations. Despite these circumstances, the task of the court in a medical malpractice action is the same as in any other case: to conduct a fair and neutral evaluation of the merits of the parties' arguments in light of the state's laws and constitution.

s 16. Both in his briefs and at oral argument, Matthew Ferdon asks this court to strike down all statutory caps on noneconomic damages in medical malpractice actions under chapter 655. This court has not held that statutory limitations on damages are per se unconstitutional.¹⁰ Indeed, this court has recently upheld the cap on noneconomic damages for wrongful

284 Wis.2d 590

death medical malpractice actions.¹¹ Just because caps on noneconomic damages are not unconstitutional per se does not mean that a particular cap is constitutional.

s 17. Courts across the country are divided about whether caps on noneconomic damages are constitutional. Even in state courts in which caps have been declared constitutional, there is invariably one or more strong dissents.¹²

284 Wis.2d 591

s 18. The roadmap to this opinion is as follows:

I. The facts (s 19 to s 23)

II. The medical malpractice statutes (s 24 to s 28)

III. Stare Decisis (s 29 to s 56)

IV. Equal Protection

A. The level of scrutiny (s 59 to s 80)

B. The classifications (s 81 to s 84)

C. The legislative objectives (s 85 to s 96)

D. The rational basis (s 97 to s 176)

V. Other Statutes (s 177 to s 183)

VI. Conclusion (s 184 to s 188)

284 Wis.2d 592

I. FACTS

s 19. According to evidence produced at trial that the jury apparently accepted, as the doctor was delivering Matthew Ferdon, the doctor pulled on Matthew Ferdon's head. The manner in which the doctor pulled caused...