Litigation Section Blog: Wisconsin Supreme Court Approves Allocation of Unclaimed Class Action Funds to Low Income Legal Services:

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  • Litigation Section Blog
    September
    29
    2016

    Wisconsin Supreme Court Approves Allocation of Unclaimed Class Action Funds to Low Income Legal Services

    David J. Harth

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    The Wisconsin Supreme Court has amended Wis. Stat. section 803.08 (effective Jan. 1, 2017) to require the allocation of at least half of unclaimed class action awards to the Wisconsin Trust Account Foundation for the support of legal services to low-income and indigent persons.
    gavel with money

    On June 24, 2016, the Wisconsin Supreme Court issued an order amending Wis. Stat. section 803.08 to require the allocation of at least half of unclaimed class action awards to the Wisconsin Trust Account Foundation (WisTAF) for the support of legal services to low-income and indigent persons.

    David Harth com DHarth perkinscoie David Harth, U.W. 1979, is a partner in the Intellectual Property practice group at Perkins Coie in Madison, where he has 35 years of experience handling high-stakes civil litigation, often involving complex scientific and technical issues.

    The amendment was the result of a petition brought by the Wisconsin Access to Justice Commission and supported by a number of legal organizations throughout the state, including the State Bar of Wisconsin, the State Bar Litigation Section, the Wisconsin Trial Judges Association, the Wisconsin Association for Justice, the Western District Bar Association of Wisconsin, WisTAF, the Legal Aid Society of Milwaukee, Legal Action of Wisconsin, Disability Rights Wisconsin, Wisconsin Judicare, and the AIDS Resource Center of Wisconsin.

    Eighteen other states have adopted rules or passed legislation providing that unclaimed class action funds be earmarked for low-income legal services. In many of these states, this has resulted in significant increases in the available funding for these services.

    The text of the rule change is as follows:

    1. “Residual Funds” means funds that remain after the payment of all approved class member claims, expenses, litigation costs, attorney fees and other court-approved disbursements in an action under this section.

    2. “WisTAF” means the Wisconsin Trust Account Foundation, Inc.

      (b) 1. Any order entering a judgment or approving a proposed compromise of a class action that establishes a process for identifying and compensating members of the class shall provide for disbursement of any residual funds. In class actions in which residual funds remain, not less than fifty percent of the residual funds shall be disbursed to WisTAF to support direct delivery of legal services to persons of limited means in non-criminal matters. The circuit court may disburse the balance of any residual funds beyond the minimum percentage to WisTAF for purposes that have a direct or indirect relationship to the objectives of the underlying litigation or otherwise promote the substantive or procedural interests of members of the certified class.

      (b) 2. This subsection does not prohibit the trial court from approving a settlement that does not create residual funds.

    The effective date of the rule is Jan. 1, 2017. The new amendments will apply to proceedings commenced after the effective date and, “insofar as is just and practicable,” to proceedings pending on the effective date.

    This article was originally published on the State Bar of Wisconsin’s Litigation Section Blog. Visit the State Bar Sections or the Litigation Section’s web pages to learn more about the benefits of section membership.





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