Court of Appeals sides with Legislature on DOJ settlements, reverses decision by Supreme Court hopeful

By Alexandria Staubach
 
Today the Wisconsin Court of Appeals reversed Dane County Circuit Judge Susan Crawford’s 2022 decision siding with Attorney General Josh Kaul in a dispute about the separation of powers in litigation settlements.
 
Judge Maria S. Lazar, a former Waukesha County Circuit Court judge, wrote for the District 2 appellate court. She was joined by Judge Shelly A. Grogan, a former clerk to Supreme Court Justice Rebecca Grassl Bradley. Both Lazar and Grogan list in their court biographies participation in the Federalist Society.
 
Judge Lisa S. Neubauer dissented.
 
Crawford is running to replace retiring Justice Ann Walsh Bradley next year. Her opponent is Judge Brad Schimel, a former Republican state attorney general.
 
Crawford ruled that the Legislature violated the Wisconsin Constitution when passing legislation that gave it veto power over some functions of the Department of Justice—specifically instances where prosecution by the DOJ will potentially result in a payment to the state.
 
In reversing that decision, Lazar stated that “(n)o one branch—or official—stands above the others with unfettered authority to act as it pleases,” while granting the Legislature power to interfere in the administration of the DOJ, a part of the executive branch.
 
The case challenged legislation that required the DOJ to seek approval from the Legislature’s Joint Committee on Finance to settle civil actions prosecuted by the office where the state will receive cash—a power that historically was the exclusive territory of the DOJ. The act was among several the Legislature hastily passed in late 2018 before Gov. Scott Walker left office.
 
Lazar wrote that “there are some areas where our three branches of government share powers” and “(t)he statute at issue falls within those great borderlands of power.” 
 
The Legislature successfully argued that because money collected by the DOJ belongs to the state and because one of the Legislature’s powers is to appropriate state funds, it should have a say in settlement negotiations.
 
As described by Lazar, the Legislature argued that the law in question “allows it to determine how the attorney general distributes settlement funds and to ensure that those funds are utilized for purposes designated by the legislature,” dismissing the DOJ’s argument that settlement in such actions constitutes a core executive power.
 
“Given our conclusion that settlement of at least some cases . . . implicates the legislature’s power of the purse, we need not discuss this espoused public policy interest (separation of powers) further,” Lazar wrote.
 
In dissent, Neubauer wrote that the majority decision “cannot be reconciled with Wisconsin’s separation of powers jurisprudence.”
 
“Separation of powers principles exist in part to prevent one branch from intruding into another branch’s zone of exclusive authority,” she wrote.
 
Allowing the Legislature to interfere in settlement negotiations “substantially interferes with the executive branch’s role” and improperly permits the Joint Finance Committee to serve as gatekeeper to a core executive function, Neubauer said. 

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