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Mayo v. Wisconsin Injured Patients and Families Compensation Fund

Court of Appeals of Wisconsin, District I

July 5, 2017

Ascaris Mayo and Antonio Mayo, Plaintiffs-Respondents-Cross-Appellants,
Wisconsin Injured Patients and Families Compensation Fund, Defendant-Appellant-Cross-Respondent, United Healthcare Insurance Company and Wisconsin State Department of Health Services, Involuntary-Plaintiffs, Proassurance Wisconsin Insurance Company, Wyatt Jaffe, MD, Donald C. Gibson, Infinity Healthcare, Inc. and Medical College of Wisconsin Affiliated Hospitals, Inc., Defendants.

         APPEAL and CROSS-APPEAL from a judgment of the circuit court for Milwaukee County No. 2012CV6272: JEFFREY A. CONEN, Judge. Affirmed.

          Before Brennan, P. J., Kessler and Brash, JJ.

          KESSLER, J.

         ¶1 This is an appeal stemming from a circuit court decision finding the $750, 000 cap on noneconomic damages in medical practice actions, as articulated in WIS. STAT. § 893.55 (2015-16), [1] unconstitutional as it applied to Ascaris and Antonio Mayo. This is also a cross-appeal of the circuit court's finding that the statutory cap is not unconstitutional on its face. We conclude that the statutory cap on noneconomic damages is unconstitutional on its face because it violates the same principles our supreme court articulated in Ferdon ex rel. Petrucelli v. Wisconsin Patients Comp. Fund, 2005 WI 125, 284 Wis.2d 573, 701 N.W.2d 440, by imposing an unfair and illogical burden only on catastrophically injured patients, thus denying them the equal protection of the laws. We conclude that because Wisconsin's cap on noneconomic medical malpractice damages always reduces noneconomic damages only for the class of the most severely injured victims who have been awarded damages exceeding the cap, yet always allows full damages to the less severely injured malpractice victims, this cap denies equal protection to that class of malpractice victims whose adequate noneconomic damages a factfinder has determined are in excess of the cap. Because we conclude that the statutory cap is facially unconstitutional, we need not reach the question of whether the cap is unconstitutional as it applies to the Mayos and we do not disturb the circuit court's findings as to that question. Because the effect of our decision still entitles the Mayos to their jury award, we affirm the circuit court, albeit on different grounds.


         ¶2 This case concerns a catastrophic injury sustained by Ascaris Mayo stemming from an untreated septic infection. Despite a hospital visit, the infection ultimately resulted in the amputation of all of her extremities. According to facts adduced at trial, in May 2011, Ascaris Mayo visited the emergency room of Columbia St. Mary's Hospital in Milwaukee for abdominal pain and a high fever. Mayo was seen by Dr. Wyatt Jaffe and a physician's assistant, Donald Gibson. Gibson included infection in his differential diagnosis and admitted at trial that Mayo met the criteria for Systematic Inflammatory Response Syndrome. Neither medical professional informed Mayo about the diagnosis or the available treatment, namely, antibiotics. Instead, Mayo was told to follow up with her personal gynecologist for her history of uterine fibroids. Mayo's condition worsened. The following day, Mayo visited a different emergency room, where she was diagnosed with a septic infection caused by the untreated infection. Mayo became comatose and eventually became minimally responsive until she was transferred to another medical facility. Ultimately, the sepsis caused nearly all of Mayo's organs to fail and led to dry gangrene in all four of Mayo's extremities, necessitating the amputation of all of Mayo's extremities.

         ¶3 The Mayos sued Dr. Jaffe, Gibson, Infinity Health Care, Inc., ProAssurance Wisconsin Insurance Co., and the Wisconsin Injured Patients and Families Compensation Fund, alleging medical malpractice and failure to provide proper informed consent.

         ¶4 The Fund filed a motion to consider constitutionality issues pre-trial. The circuit court addressed the issue of whether the statutory cap on noneconomic damages, as stated by WIS. STAT. § 893.55(4)(d)l. ("the cap"), was unconstitutional. Ultimately, the circuit court held that the cap was not facially unconstitutional but allowed the Mayos to raise an as-applied challenge to the cap post-trial if the Mayos so chose.

         ¶5 After a lengthy jury trial, the jury found that neither Dr. Jaffe nor Gibson was negligent, but that both medical professionals failed to provide Mayo with the proper informed consent regarding her diagnosis and treatment options. As material to these appeals, the jury awarded Ascaris Mayo $15, 000, 000 in noneconomic damages and Antonio Mayo $1, 500, 000 for his loss of the society and companionship of his wife.

         ¶6 Post-verdict, the Fund moved to reduce the Mayos' jury award to the $750, 000 statutory cap on noneconomic damages imposed by WIS. STAT. § 893.55. The Mayos moved for entry of judgment on the verdict, arguing that an application of the cap would violate their constitutional rights. The Mayos also renewed their pre-trial facial challenge to the cap. The parties again fully briefed the constitutional issues and the circuit court reconsidered the constitutional questions.

         ¶7 The circuit court determined that the cap was not facially unconstitutional, but that it was unconstitutional as applied to the Mayos because it violated the Mayos' rights to equal protection and due process. Relying in part on the principles articulated by the Wisconsin Supreme Court in Ferdon, the circuit court made multiple findings, including: (1) application of the cap would reduce the Mayos' noneconomic damages jury award by 95.46%; (2) there is no rational basis to deprive Ascaris Mayo, who is largely immobile, of the money the jury found necessary to compensate her for her injuries; (3) reducing the Mayos' jury award would not further the cap's purpose of promoting affordable healthcare to Wisconsin residents while also ensuring adequate compensation to medical malpractice victims; (4) financially, the Fund was more than capable of honoring the jury's award without jeopardizing its solvency; and (5) applying the cap would not advance the legislative purpose of "policing high or unpredictable economic damage awards."

         ¶8 Both the Fund and the Mayos appeal the circuit court's constitutionality rulings. The Fund argues that the circuit court erred when it found WIS. Stat. § 893.55 unconstitutional as it applied to the Mayos. The Mayos argue that the circuit court erred when it determined that § 893.55 was not unconstitutional on its face. Each disputes the other's arguments.


         ¶9 The Mayos contend that WIS. STAT. § 893.55 is facially unconstitutional because it violates the equal protection rights of catastrophically injured patients. Specifically, they contend that there is no rational basis linking the amount of the current noneconomic damages cap to the legislature's articulated purposes for enacting the cap. We agree.

         Standard of Review

         ¶10 Whether a statute is constitutional presents a question of law that we review de novo. See State v. Cole, 2003 WI 112, ¶10, 264 Wis.2d 520, 665 N.W.2d 328. A statute's constitutionality may be challenged "as applied" or "facial[ly]." Olson v. Town of Cottage Grove, 2008 WI 51, ¶44 n.9, 309 Wis.2d 365, 749 N.W.2d 211. A '"[f]acial challenge'" is '"[a] claim that a statute is unconstitutional on its face-that is, that it always operates unconstitutionally.'" Id. (citation omitted).

         ¶11 A statute is presumed to be constitutional and we resolve any doubt about the constitutionality of a statute in favor of upholding its constitutionality. See Dane County DHS v. P.P., 2005 WI 32, ¶16, 279 Wis.2d 169, 694 N.W.2d 344. A party challenging a statute's constitutionality must demonstrate that the statute is unconstitutional beyond a reasonable doubt. Id., ¶18. In this context, the phrase, "beyond a reasonable doubt, " establishes the force or conviction with which a court must conclude, as a matter of law, that a statute is unconstitutional before the statute or its application can be set aside. Id. As our supreme court explained:

[J]udicial deference to the legislature and the presumption of constitutionality of statutes do not require a court to acquiesce in the constitutionality of every statute. A court need not, and should not, blindly accept the claims of the legislature. For judicial review under rational basis to have any meaning, there must be a meaningful level of scrutiny, a thoughtful examination of not only the legislative purpose, but also the relationship between the legislation and the purpose. The court must probe beneath the claims of the government to determine if the constitutional requirement of some rationality in the nature of the class singled out has been met.

Ferdon, 284 Wis.2d 573, ¶77 (multiple sets of quotation marks and citations omitted).

         ¶12 "When considering an equal protection challenge to a statute, this court employs the rational basis test, unless the statute involves a suspect class or a fundamental right."[2] Kohn v. Darlington Cmty. Sch., 2005 WI 99, ¶46, 283 Wis.2d 1, 698 N.W.2d 794. "Equal protection guarantees that similarly-situated persons are treated similarly." State ex rel Harr v. Berge, 2004 WI.App. 105, ¶5, 273 Wis.2d 481, 681 N.W.2d 282. '"Equal protection does not require that all persons be dealt with identically, but it does require that a distinction made have some relevance to the purpose for which the classification is made.'" Tateoka v. City of Waukesha Bd. of Zoning Appeals, 220 Wis.2d 656, 671, 583 N.W.2d 871 (Ct. App. 1998) (citation omitted). The "basic formulation" of the rational basis test is the same in both facial and as-applied challenges. See Smith v. City of Chicago, 457 F.3d 643, 652 (7th Cir. 2006). Under this standard, the constitution requires only that the statute creating a classification be '"rationally related to a valid legislative objective.'" State v. Jorgensen, 2003 WI 105, ¶32, 264 Wis.2d 157, 667 N.W.2d 318 (citation omitted).[3]

         The legislative cap on noneconomic damages

         ¶13 In Ferdon, the Wisconsin Supreme Court held that the previous cap on noneconomic damages, set at $350, 000 (adjusted for inflation), was facially unconstitutional. Id., 284 Wis.2d 573, ¶¶184-187. "The court must presume that the legislature's judgment was sound and look for support for the legislative act. But the court cannot accept rationales so broad and speculative that they justify any enactment. '[W]hile the connection between means and ends need not be precise, it, at least, must have some objective basis.'" Id., ¶¶184 (citation omitted; brackets in Ferdon). A jury awarded Matthew Ferdon $700, 000 in noneconomic damages for medical negligence which occurred at his birth, resulting in partial paralysis and deformity in his right arm. Id., ¶¶2, 3. After the verdict, the Fund moved to reduce the award in accordance with the statutory cap on noneconomic damages. Id., ¶¶4, 8. The circuit court granted the motion. Id., ¶6. Ferdon appealed on several grounds. As relevant to the issue before us, he argued that the statutory cap violated his equal protection and due process rights guaranteed by the Wisconsin Constitution. See id., ¶9.

         ¶14 Justice Crooks, in his concurrence, succinctly explained the history of the noneconomic damages cap in Wisconsin medical malpractice cases:

When Wis.Stat. ch. 655 was first enacted in 1975, there was no cap on noneconomic damages, but a $500, 000 conditional cap that could be triggered if the Wisconsin Patient Compensation Fund's cash-flow was in jeopardy.... Then, in 1986, the legislature set the cap at $1, 000, 000. This $1, 000, 000 cap remained in effect until 1991, when a sunset provision became effective. There was no cap on noneconomic damages from 1991 until the legislature passed the current statutory cap of $350, 000 in 1995. Thus, the caps changed from nothing, to $1, 000, 000, back to nothing, and finally to $350, 000 over the course of 20 years.

Ferdon, 284 Wis.2d 573, ¶190 (Crooks, J., concurring). The accuracy of Justice Crooks's historical summary was not disputed by any Justice.

         ¶15 Using a rational basis level of scrutiny, the Ferdon majority noted that the "standard in the equal protection context does not require that all individuals be treated identically, but any distinctions must be relevant to the purpose motivating the classification." Id., ¶72. The court declared its goal as one to "determine whether the classification scheme rationally advances the legislative objective." Id., ¶81. The classification the supreme court described in Ferdon was the "distinction between medical malpractice victims who suffer over $350, 000 in noneconomic damages, and medical malpractice victims who suffer less than $350, 000 in noneconomic damages.... In other words, the statutory cap creates a class of fully compensated victims and partially compensated victims." Id., ¶82. The court observed that "the cap's greatest impact falls on the most severely injured victims." Id. The effect of the court's observation is to acknowledge two classifications of victims created by the cap: (1) the class of the most ...

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