In April 2017, the Wisconsin Supreme Court, acting in response to a request of the Business Court Advisory Committee, established a pilot large claim commercial case docket for the assignment of commercial cases. The purposes of the pilot commercial court (which some refer to as the business court) were

to ensure that large claim cases involving Wisconsin employers or businesses, or which involve complicated disputes, are resolved expeditiously and with the least amount of cost so as to (a) improve the quality and predictability of justice in connection with business disputes; (b) improve parties’ access to justice; (c) make repeat dispute less likely to occur due to guidance provided by ongoing decisions; and (d) make Wisconsin a desirable forum for resolving business disputes.¹

The pilot project was approved for an initial term of three years. It applied to the Waukesha County Circuit Court and the circuit courts of the Eight Judicial Administrative District (which encompasses counties in the northeastern most part of the state: Door, Marinette, Brown, Outagamie, Waupaca, Kewaunee, and Oconto counties).

In 2020, the Supreme Court extended the pilot project for two more years to 2022. It also expanded the pilot project to courts in the Second Judicial District (the southeastern counties of Kenosha, Racine, and Walworth) and the Tenth Judicial District (encompassing counties in the northwestern most part of the state: Ashland, Barron, Bayfield, Burnett, Chippewa, Douglas, Dunn, Eau Claire, Polk, Rusk, Sawyer, St. Croix, and Washburn).

The Supreme Court again extended the pilot project to 2024. In 2024, the Court ordered that there be a public hearing about the pilot project. After the hearing, on a vote of 4-3, the Court terminated the pilot project.²

Importantly, the pilot project never covered the counties that are the biggest contributors to state gross domestic product in Wisconsin – Milwaukee and Dane.³ Indeed, in 2022, Milwaukee alone generated twice the gross domestic product as did Waukesha, which was the third largest contributor to state gross domestic product that year.

How the Court Worked

Under the pilot project, the Wisconsin Chief Justice was directed to select the judges in the identified counties and judicial districts to serve on the commercial court docket. The order capped the number of circuit court judges who would be designated to the commercial court docket in each approved district (or county), clarifying that those judges were to also remain on their assigned dockets as well.

The Court then identified a category of claims that, if brought in a circuit (or county) for which there was a commercial court, had to be litigated in the commercial court. That category included cases involving:

• governance of internal affairs of business organizations (especially fiduciary duty lawsuits);

• mergers and acquisitions;​

• ​securities law claims;

• intellectual property rights; and

• tortious or statutory prohibited activities, including antitrust claims and noncompete claims.

The Order establishing the commercial court also enabled parties to jointly petition the chief judge of a judicial district with a commercial court to move their suit to the commercial court there. The chief judge had discretion to do so, considering factors such as the nature of the parties, the nature of the dispute, and the complexity of the issues presented.

The End of Commercial Courts in Wisconsin

In 2024, the Business Court Advisory Committee requested that the Wisconsin Supreme Court once again extend the term of the commercial court pilot program for two years.⁴ In response to that request, the Court invited comments from the public and held a public hearing.

I do not intend to summarize the statements (both in letters submitted to the court and in the public hearing) in support of and opposed to the commercial law courts.⁵ But I do want to note that much of the critique and discussion at the hearing before the Supreme Court seemed to center around the need for more data, to either (or both) support the need for a separate business court or to support the structure of that court.⁶

Importantly, in an order on Oct. 7, 2024, the Wisconsin Supreme Court ordered the termination of the pilot project.⁷ What this means is no new dispute may be brought before a commercial court created under the pilot project, though existing cases may continue.

Resolving Business Disputes Without Commercial Courts in Wisconsin

I understand that the Court may be tasking an advisory committee to continue to explore another attempt at a commercial court in Wisconsin. Meanwhile, there are possible steps that businesses can take to help mitigate some of the dispute-resolution uncertainty associated with not knowing if commercial courts will reemerge in Wisconsin.

Add an arbitration provision. First, businesses can agree to have their contractual disputes resolved by arbitration. Doing so allows the contracting parties to have more certainty as to how their disputes will be resolved even absent a commercial court.

In the arbitration provision, the parties can set out many aspects of the arbitration, including:

• the arbitration provider (e.g., American Arbitration Association);

• which rules apply (e.g., the commercial arbitration rules of the American Arbitration Association);

• how many arbitrators they want to resolve their dispute (e.g., one or three, both commonly used and both of which avoid a deadlock); and

• how the arbitrator or arbitrators are selected.

They can also agree on who pays the fees and costs of arbitration (e.g., shared, paid by initiator, allocated based on liability as determined by the arbitrator(s)).

Going the route of arbitration – and especially identifying the relevant commercial arbitration rules – will help the parties get the expertise, speed, and predictability they might have otherwise obtained through a commercial court. (On the other hand, they typically do not get the transparency they would have achieved through judicial dispute resolution.)

Commercial court in another jurisdiction. As another option, contracting parties can opt to have a commercial court in another jurisdiction resolve their disputes, if the selected forum would have jurisdiction over the parties and dispute and any jurisdictional requirements associated with the commercial court were satisfied.

As it stands, 35 states have business courts, including Illinois, Michigan, and Minnesota.⁸ So, this creates a fairly sizeable pool of states with business courts that could potentially hear disputes involving Wisconsin businesses.

To do this, parties simply select the relevant forum for disputes in their contract (assuming, again, there are adequate connections to that state), consent to its personal jurisdiction over them in the contract, and agree that they will use commercially reasonable or best efforts to have the relevant business court in that jurisdiction resolve their dispute.

Use a Wisconsin court. Finally, businesses could agree to have their disputes resolved by a Wisconsin court, and also agree to use commercially reasonable or best efforts to have their suit moved to the commercial court in that forum if one exists at the time the lawsuit is filed.

This would create an obligation on the parties to try to have their dispute resolved in the commercial court in their judicial district if one exists at the time the lawsuit is filed.

While this does not resolve the current uncertainty as to the potential future of commercial courts, it at least creates a shared understanding that the parties will attempt to have any disputes resolved in Wisconsin’s business courts if those are reinstated.

Be Mindful in Contracting

Whatever the approach, lawyers should be thoughtful about contracting in an uncertain environment, where commercial courts may (or may not) reemerge in Wisconsin.

This article was originally published on the State Bar of Wisconsin’s Business Law Blog. Visit the State Bar sections or the Business Law Section webpages to learn more about the benefits of section membership.

Endnotes

¹ Supreme Court of Wisconsin Order No. 16-05, In re Creation of a Pilot Project for Dedicated Trial Court Judicial Dockets for Large Claim Business and Commercial Cases (Apr. 11, 2017). Justice S. Abrahamson dissented from the decision for a number of reasons, including her view that the proposal sends the “message that circuit court judges are not capable of handling complex civil cases and that business, above all, deserve the fastest, most cost-effective, most predictable and fairest disposition of cases.” She also Identified procedural concerns with the proposal, including that it was adopted without public input, without a hearing, and without discussion.

² Supreme Court of Wisconsin Order No. 16-05E, In the Matter of Creation of a Pilot Project for Dedicated Trial Court Judicial Dockets for Large Claim Business and Commercial Cases (Oct. 7, 2024).

³ Wisconsin REAP Project, Gross Domestic Product by County.

⁴ Rules Petition 16-05E, Proposed Amendment to Pilot Project and Interim Rule, In re Creation of a Pilot Project for Dedicated Trial Court Judicial Dockets for Large Claim Business and Commercial Cases (May 30, 2024).

⁵ In a letter submitted in connection with its petition to extend the term of the commercial court docket, a member of the Business Court Advisory Committee reviews and responds to many of the challenges. SeeLetter from Gierke Law LLC to Justices of the Supreme Court of Wisconsin & Clerk of Court, Sept. 23, 2024.

⁶ Wisconsin Supreme Court Public Hearing, Sept. 24, 2024. In listening to the discussions during the public hearing, it was not clear to me whether the Court sought data to support the need for a commercial court, or data to support the form such court would take. In any event, I am hopeful that those involved in considering the reestablishment of a commercial court do not feel a need to over-rely on data to the exclusion of the experiences of lawyers and parties who have appeared before business courts (including the Wisconsin pilot commercial court), or to the exclusion of the experiences of states that have used business courts.

⁷ Supreme Court of Wisconsin Order No. 16-05E.

⁸ The Nationwide Innovation of Specialized Business and Commercial Courts for Effective Resolution of Disputes: Summary of Resources and Courts, American Bar Association, Apr. 11, 2024.