Wisconsin proclaimed "North Korea", full employment for courts, lawyers to begin soon. (Consumer Matters)

Last week, Governor-for-Now Scott ("Patsy") Walker signed into law the new bill that limits attorney's fees to a presumptive cap of 3 times the actual damages awarded to the claimant.

That bill did not sit well with the lawyer whose case spurred the Republican law-passing machine into action after the donor/defendant bought himself a law that will make it easier for car dealers to rip off consumers: Vince Megna, the lawyer who represented the plaintiff in the suit Kaskin v. John Lynch -- the case that led John Lynch Chevrolet to buy off some Republican legislators for the low, low price of just $10,000 -- reportedly issued a statement that he would never represent a Republican again and calling Wisconsin "North Korea."

One thing that's been largely overlooked in the debate -- not that there was a debate; for $10,000, you can buy enough Republicans to avoid debate -- is the sheer number of statutes and regulations affected by the new law. The State Bar of Wisconsin (which opposed the bill) estimated that as many as 280 different laws are affected.

The text of the bill (insofar as I could see it; the full text isn't currently available on the Legislative Reference Bureau's site, but I didn't hear that Governor For Now vetoed any portion of the bill) says that the cap aplies to "any action involving the award of attorney fees that are not governed by s. 814.04 (1) or involving a dispute over the reasonableness of attorney fees," which is, as the Bar noted, a pretty broad swath. Section 814.04 is the general costs statute that lets courts tax a nominal amount of fees based on the dollar amount of the case, which means that this law presumably applies to every single action in which one side or the other gets attorney's fees (or could.)

What remains to be seen, notwithstanding Mr. Megna's declaration of where we now live, is how the Courts will interpret this. With the cap being only a presumptive cap, what the bill has actually created is not a hard-and-fast bar to a claim of greater fees, but instead more litigation, as lawyers (like me) who represent consumers will face substantial litigation -- in one recent case I was outspent by 5-to-1 (or more) by the lenders involved -- and substantial costs, and, if the defendants take the stance that they won't pay our full fees, we'll have no choice but to litigate those claims and see if the judge will allow greater costs and fees.

Consider what happened under a similar law. The Fair Debt Collection Practices Act (FDCPA) has a provision that allows an award of "reasonable" fees to successful litigants at 15 U.S.C. 1692k(a)(3). A nationwide search for cases mentioning that specific provision turned up 287 reported cases in the last 33 years, or about 10 cases per year. The litigation over attorney's fees got so complicated that at one point, the Second Circuit simplified things this way:

In Arbor Hill Concerned Citizens Neighborhood Ass'n v. County of Albany, 493 F.3d 110 (2d Cir. 2007), amended on other grounds by 522 F.3d 182 (2d Cir. 2008)], we undertook to simplify the complexities surrounding attorney's fees awards that had accumulated over time under the traditional "lodestar" approach to attorney's fees (the product of the attorney's usual hourly rate and the number of hours worked, which could then be adjusted by the court to set "the reasonable fee"), and the separate "Johnson" approach (a one-step inquiry that considered twelve specified factors to establish a reasonable fee). 493 F.3d at 114. Relying on the substance of both approaches, we set forth a standard that we termed the "presumptively reasonable fee." Id. at 118. We directed district courts, in calculating the presumptively reasonable fee, "to bear in mind all of the case-specific variables that we and other courts have identified as relevant to the reasonableness of attorney's fees in setting a reasonable hourly rate." Id. at 117 (emphasis in original). The presumptively reasonable fee boils down to "what a reasonable, paying client would be willing to pay," given that such a party wishes "to spend the minimum necessary to litigate the case effectively." Id. at 112, 118.

That is, the Court took two existing standards, melded them together into a third standard altogether, then directed district courts to use this new standard but to keep in mind "all of the case-specific variables" while also figuring out "what a reasonable, paying client would be willing to pay," which in turn suggests that the actual client (many of my clients pay by the hour) is not a reasonable client, and all the while the judge is to be second-guessing what the minimum necessary litigation is to "litigate the case effectively."

Seems simple enough! I'll plan on being in my office Saturdays as well as Sundays, now.