2023 WI 43

SUPREME COURT OF WISCONSIN

CASE NO.: 2020AP806

COMPLETE TITLE: Allsop Venture Partners III, Alta V. Limited 

Partnership, Alta Subordinated Debt Partners III 

LP and State of Wisconsin Investment Board,

 Plaintiffs,

Terry K. Shockley, Sandy K. Shockley and 

Shockley Holdings Limited Partnership, Inc.,

 Intervenors-Plaintiffs-AppellantsPetitioners,

Terence F. Kelly,

 Intervenor,

 v.

Murphy Desmond SC, Robert A. Pasch and Westport 

Insurance Company,

 Defendants-Respondents.

REVIEW OF DECISION OF THE COURT OF APPEALS 

Reported at 399 Wis. 2d 841, 967 N.W.2d 309

(2021 – unpublished)

OPINION FILED: June 2, 2023 

SUBMITTED ON BRIEFS: 

ORAL ARGUMENT: October 17, 2022 

SOURCE OF APPEAL:

COURT: Circuit 

COUNTY: Dane 

JUDGE: Richard G. Niess 

JUSTICES:

HAGEDORN, J., delivered the majority opinion of the Court, in 

which ANN WALSH BRADLEY, DALLET, and KAROFSKY, JJ., joined. 

ZIEGLER, C.J., filed a dissenting opinion in which ROGGENSACK 

and REBECCA GRASSL BRADLEY, JJ., joined.

NOT PARTICIPATING:

 

ATTORNEYS:

For the intervenors-plaintiffs-appellants-petitioners, 

there were briefs filed by Robert J. Kasieta and Kasieta Legal 
2

Group, LLC, Madison, and Scott F. Hessell, Bruce S. Sperling, 

Michael G. Dickler, and Sperling & Slater, P.C., Chicago. There 

was an oral argument by Scott F. Hessell. 

For the defendants-respondents, there was a brief filed by 

Terry E. Johnson, Maria del Pizzo Sanders, and von Briesen & 

Roper, S.C., Milwaukee. There was an oral argument by Terry E. 

Johnson. 
2023 WI 43

NOTICE

This opinion is subject to further 

editing and modification. The final 

version will appear in the bound 

volume of the official reports. 

No. 2020AP806

(L.C. No. 2009CV4165)

STATE OF WISCONSIN : IN SUPREME COURT

Allsop Venture Partners III, Alta V. Limited 

Partnership, Alta Subordinated Debt Partners 

III LP and State of Wisconsin Investment Board,

 Plaintiffs,

Terry K. Shockley, Sandy K. Shockley and 

Shockley Holdings Limited Partnership, Inc.,

 Intervenors-Plaintiffs-AppellantsPetitioners,

Terence F. Kelly,

 Intervenor,

 v.

Murphy Desmond SC, Robert A. Pasch and Westport 

Insurance Company,

 Defendants-Respondents.

FILED

JUN 2, 2023

Sheila T. Reiff

Clerk of Supreme Court

HAGEDORN, J., delivered the majority opinion of the Court, in 

which ANN WALSH BRADLEY, DALLET, and KAROFSKY, JJ., joined. 

ZIEGLER, C.J., filed a dissenting opinion in which ROGGENSACK 

and REBECCA GRASSL BRADLEY, JJ., joined.

REVIEW of a decision of the Court of Appeals. Affirmed. 
No. 2020AP806 

2

¶1 BRIAN HAGEDORN, J. This is a review of certain 

evidentiary determinations and other related issues following a 

jury verdict in a legal malpractice trial. This matter arose 

when a media company entered into a seemingly tax-friendly sale—

—dubbed a "midco transaction"——with the assistance of three 

entities: a tax law firm, an accounting firm, and corporate law 

firm Murphy Desmond SC (Murphy Desmond). The deal closed and 

the shareholders received their payout, but the favorable 

arrangement fell apart when the IRS came after the shareholders 

for taxes and penalties. Three shareholders (collectively the 

Shockleys)1 intervened in litigation against all three assisting 

entities and brought their own claims of legal malpractice, 

negligence, and fraud. The Shockleys later settled with the tax 

and accounting firms, signed a Pierringer release,2 and amended 

their complaint to remove the allegations against them. All

that remained were legal malpractice-related claims against 

Murphy Desmond. 

 

1 The three shareholders are Sandy Shockley, Terry Shockley, 

and Shockley Holdings Limited Partnership, Inc. (Shockley 

Holdings).

2 "A Pierringer release operates as a satisfaction of that 

portion of the plaintiff's cause of action for which the 

settling joint tortfeasor is responsible, while at the same time 

reserving the balance of the plaintiff's cause of action against 

a nonsettling joint tortfeasor." Teske v. Wilson Mut. Ins. Co., 

2019 WI 62, ¶11 n.6, 387 Wis. 2d 213, 928 N.W.2d 555 (quoting 

Imark Indus. Inc. v. Arthur Young & Co., 148 Wis. 2d 605, 621, 

436 N.W.2d 311 (1989)); see Pierringer v. Hoger, 21 Wis. 2d 182, 

184-85, 124 N.W.2d 106 (1963).
No. 2020AP806 

3

¶2 At trial, Murphy Desmond was found negligent in part, 

but the circuit court concluded it was entitled to 

indemnification from the other two entities who had already 

settled, leaving the Shockleys with no additional recovery. The 

Shockleys appealed, lost, and now present four issues for our 

review. 

¶3 First, the Shockleys argue the circuit court erred 

when it admitted into evidence, for the limited purpose of bias 

or prejudice, the fact that the Shockleys settled with the two 

other entities.3 This claim concerns the circuit court's 

application of Wis. Stat. § 904.08 (2021-22),4 which generally 

prohibits the admission of settlement evidence, yet permits its 

admission in narrow circumstances. We conclude the circuit 

court did not erroneously exercise its discretion because it 

applied the appropriate law and reached a reasonable 

determination that an exception applied under the unique facts 

of this case, which it reinforced with a limiting instruction to 

the jury. 

¶4 Second, the Shockleys contend a comment in Murphy 

Desmond's closing argument impermissibly used the settlement 

evidence to argue liability, and claim the circuit court wrongly 

denied the Shockleys' post-trial motion for a new trial. We 

 

3 Evidence of settlement amounts——which we have said is not 

permitted——was introduced by the Shockleys, not Murphy Desmond, 

and is not challenged here. 

4 All subsequent references to the Wisconsin Statutes are to 

the 2021-22 version.
No. 2020AP806 

4

agree that the circuit court erred in permitting the closing 

remark, but hold it did not erroneously exercise its discretion 

when it denied the Shockleys' motion for a new trial. 

¶5 Third, the Shockleys maintain the circuit court 

mistakenly admitted their original, superseded complaint. We 

conclude that regardless of whether this was error, its 

admission was harmless. 

¶6 Finally, Sandy Shockley and Shockley Holdings assert 

that Murphy Desmond may still owe damages based on the jury's 

verdict because its negligence was not attributable to the 

intentional misrepresentations committed by the two other, nowsettled entities. In Fleming v. Thresherman's Mutual Insurance

Co., we held that intentional tortfeasors must indemnify 

negligent parties whose liability is joint, and that a 

Pierringer release imputes to the plaintiff the settling 

defendant's liability to nonsettling defendants. 131 

Wis. 2d 123, 130-31, 388 N.W.2d 908 (1986). We conclude the 

evidence at trial confirms that liability was joint. Therefore, 

in accord with Fleming, Murphy Desmond owes no damages to Sandy 

Shockley and Shockley Holdings. 

¶7 For these reasons, we affirm the decision of the court 

of appeals. 

I. BACKGROUND

¶8 In 1985, Terry and Sandy Shockley bought a radio 

station in Madison and rebranded it to oldies, a move that 

proved wildly successful. That success encouraged them to start 
No. 2020AP806 

5

a media company, Shockley Communications Corporation (SCC). 

Over the years, SCC amassed nine radio stations and six TV 

stations. Terry and Sandy Shockley eventually became minority 

shareholders and sat on SCC's board of directors. During that 

time, SCC began working with law firm Murphy Desmond. 

¶9 By the early 2000s, SCC pondered selling the company 

because of the hot media market. But there was a catch: 

potential buyers wanted to purchase SCC's assets, not its stock. 

That posed a problem because an asset sale would cause a tax 

both at the corporate level and at the individual (shareholder) 

level. That's when accounting firm RSM McGladrey, Inc. (RSM) 

entered the picture. 

¶10 RSM proposed a solution: a "midco transaction" where 

SCC would sell its stock to a middle company and the middle 

company would then sell the assets to various interested buyers. 

After initial discussions with RSM, the shareholders hired tax 

law firm Curtis, Mallet-Prevost, Colt & Mosle LLP (Curtis 

Mallet), which advised that the IRS would respect the deal. So, 

with Murphy Desmond's assistance on the stock sale to the middle 

company, the board put pen to paper and completed the deal. 

¶11 At first, the midco transaction worked. But the IRS 

wound up rejecting major portions of the transaction and, 

because SCC no longer existed, levied various taxes and 

penalties against the shareholders. This led to a drawn-out 

legal battle the shareholders eventually lost, leaving them with 

millions of dollars in taxes and penalties owed to the IRS. 
No. 2020AP806 

6

¶12 Several shareholders5 then sued RSM, Curtis Mallet, 

Murphy Desmond, and several associated individuals. The 

Shockleys intervened and filed a complaint against all three 

entities, alleging legal malpractice against Curtis Mallet and 

Murphy Desmond, negligence against RSM, and fraud against Curtis 

Mallet and RSM.6 

¶13 As the suit proceeded, the Shockleys settled with RSM 

and Curtis Mallet, signing a Pierringer release (more on this 

below). With the claims against RSM and Curtis Mallet 

dismissed, the Shockleys amended their complaint. They removed 

all allegations against RSM and Curtis Mallet and now asserted 

only a legal malpractice claim against Murphy Desmond and sought 

declaratory relief on the same grounds.7 It is this claim that 

the parties went to trial on and from which this appeal derives.

 

5 Allsop Venture Partners III Limited Partnership, Alta V 

Limited Partnership, Alta Subordinated Debt Partners III, L.P., 

and the State of Wisconsin Investment Board brought the initial 

suit.

6 The Shockleys also sued individual employees of Murphy 

Desmond (Robert A. Pasch), RSM (Stephen A. Schmidt and David 

Klintworth), and Curtis Mallet (William L. Brinker). The 

Shockleys asserted the same claims against the employees as 

their employers. No one argues the legal claims operate 

differently for the employees and their employers. Thus, we 

refer only to the three entities for ease of reference.

7 The Shockleys also brought a direct action claim against 

Westport Insurance Corporation, which insured Murphy Desmond 

during the relevant timeframe. This claim is not at issue here.
No. 2020AP806 

7

¶14 Prior to trial, Murphy Desmond filed a motion in 

limine. As relevant here, the motion asked the circuit court8 to 

permit Murphy Desmond to introduce two pieces of evidence: (1) 

the fact that the Shockleys settled with RSM and Curtis Mallet 

and (2) the Shockleys' original complaint against all three 

defendants. The Shockleys filed their own motion, seeking to 

exclude all evidence of prior settlement and the earlier 

complaint. The circuit court granted Murphy Desmond's motion, 

and offered to give the jury a limiting instruction regarding 

the settlement. 

¶15 In light of this ruling, the Shockleys decided to 

elicit testimony about the settlement during Sandy Shockley’s 

testimony. Before doing so, counsel for the Shockleys asked the 

circuit court to give the limiting instruction to the jury. The 

court instructed the jury accordingly, directing them to use the 

evidence for credibility purposes only, and not for the truth of 

any claim against Murphy Desmond. 

¶16 Counsel for the Shockleys then asked Sandy about the 

fact of settlement with RSM and Curtis Mallet. However, counsel 

then proceeded to ask Sandy about the settlement amounts——

evidence not addressed in the motions in limine or the circuit 

court's decision to admit the fact of settlement. Reflecting on 

this after trial, the circuit court told the Shockleys’ counsel: 

"I almost fell out of my chair when you asked Ms. Shockley how 

 

8 The Honorable Richard G. Niess of the Dane County Circuit 

Court presided.
No. 2020AP806 

8

much they got in settlement. I don't think any of my rulings 

put into evidence at issue the amount of the settlement on the 

Pierringer defendants." Both Murphy Desmond and the Shockleys 

continued to reference settlement evidence during the trial 

without objection. 

¶17 After both sides rested, closings began. Murphy 

Desmond's attorney made the following comment during its hourlong closing argument:

And [the Shockleys' lawyer] should be blushing, 

because he's the one who got up at the beginning of 

this trial and talked about this case as if they had 

never sued -- they had never accused [RSM] and Curtis 

Mallet of doing anything wrong. . . . Didn't tell you 

that they'd settled with Curtis Mallet and [RSM]. 

Didn't tell you they got enormous amounts of money 

because they're the true culprits here, of course. 

And didn't tell you that because they settled with 

them. His clients had night and day changed their 

allegations to drop all the allegations against those 

people and now take the posture that he's taking now, 

that this is, essentially, all our fault. Even though 

everything that his clients alleged against Curtis 

Mallet has been proven. Even though the settlement, 

in my opinion, is an acknowledgment that they've been 

proven. 

The Shockleys objected to this line of argument on the ground 

that Murphy Desmond was trying to use the settlement evidence to 

disprove the Shockleys' claims. The circuit court overruled 

that objection. 

¶18 Ultimately, the jury found that RSM, Curtis Mallet, 

and Murphy Desmond were negligent, as was plaintiff-shareholder 

Terry Shockley. The jury also determined that RSM and Curtis 

Mallet committed intentional misrepresentations.
No. 2020AP806 

9

¶19 After trial, the Shockleys moved for a new trial, 

arguing Murphy Desmond's closing argument went over the line. 

The circuit court denied the motion. 

¶20 Murphy Desmond also filed a motion for judgment on the 

verdict. According to Murphy Desmond, the jury's finding that 

RSM and Curtis Mallet committed intentional misrepresentations 

entitled Murphy Desmond to indemnification from them. And, 

because the Shockleys signed Pierringer releases with RSM and 

Curtis Mallet, that meant that the Shockelys stood in their 

shoes for purposes of indemnification, warranting dismissal. 

Sandy Shockley and Shockley Holdings responded that their

damages attributable to the intentional misrepresentations were 

separate from the damages attributable to the midco transaction

and thus, Murphy Desmond was not entitled to indemnification. 

The circuit court sided with Murphy Desmond, concluding Sandy 

Shockley and Shockley Holdings had neither alleged nor proven 

any non-joint liability. 

¶21 The Shockleys appealed, and the court of appeals 

affirmed. Allsop Venture Partners III v. Murphy Desmond SC, No. 

2020AP806, unpublished slip op. (Wis. Ct. App. Oct. 21, 2021) 

(per curiam).9 We granted the Shockleys' petition for review.

 

9 In addition to the four issues identified here, the 

Shockleys also appealed the sufficiency of evidence supporting 

several jury verdict answers. They did not raise those 

arguments before us.
No. 2020AP806 

10

II. DISCUSSION

¶22 The Shockleys present four arguments concerning: (1) 

admission of settlement evidence; (2) use of the settlement 

evidence during closing arguments; (3) admission of the 

Shockleys' superseded complaint; and (4) indemnity. None 

entitle the Shockleys to the relief they seek.

A. Admission of Settlement Evidence

¶23 First, the Shockleys argue that the circuit court 

erred in admitting the fact of settlement into evidence because 

it did not fall within any exceptions under Wis. Stat. 

§ 904.08.10 We review a circuit court's decision to admit 

evidence for an erroneous exercise of discretion. State v. 

Nieves, 2017 WI 69, ¶16, 376 Wis. 2d 300, 897 N.W.2d 363. As 

long as the circuit court "examined the relevant facts, applied 

a proper legal standard, and, using a demonstrated rational 

process, reached a reasonable conclusion," we will not disturb 

its ruling.11 Martindale v. Ripp, 2001 WI 113, ¶28, 246 

Wis. 2d 67, 629 N.W.2d 698.

 

10 The Shockleys also devote half a sentence to the argument 

that the probative value of the settlement evidence was 

substantially outweighed by a danger of unfair prejudice. But 

as we have repeatedly said, we do not address undeveloped 

arguments. Serv. Emps. Int'l Union, Local 1 v. Vos, 2020 WI 67, 

¶24, 393 Wis. 2d 38, 946 N.W.2d 35.

11 The dissent's warnings that this statutory exception 

should not be expansively construed are well-taken, but its 

disregard of the proper standard of review in favor of a more 

"exacting scrutiny" is the wrong response. Dissent, ¶66. In 

effect, the dissent substitutes its judgment for that of the 

circuit court. 
No. 2020AP806 

11

¶24 Wisconsin Stat. § 904.08 establishes the general rule 

that settlement-related evidence "is not admissible to prove 

liability for or invalidity of the claim or its amount." But 

this instruction is not ironclad. A circuit court can admit 

such evidence if offered "for another purpose, such as proving 

bias or prejudice of a witness," among other reasons. Id.12 In 

Morden v. Continental AG, we explained that § 904.08 is a 

modification of Federal Rule 408, and its exceptions "should not 

be expansively construed." 2000 WI 51, ¶85, 235 Wis. 2d 325, 

611 N.W.2d 659. While the exceptions should not swallow the 

rule, neither should the rule always swallow the statutory 

exceptions. The law explicitly provides that bias or prejudice 

of a witness can be a permissible basis to admit such evidence. 

See § 904.08. We have stated that this can be satisfied "by 

showing that a witness changed his or her testimony or that the 

posture of a settling party was significantly different as a 

 

12 In full, Wis. Stat. § 904.08 provides:

Evidence of furnishing or offering or promising to 

furnish, or accepting or offering or promising to 

accept, a valuable consideration in compromising or 

attempting to compromise a claim which was disputed as 

to either validity or amount, is not admissible to 

prove liability for or invalidity of the claim or its 

amount. Evidence of conduct or statements made in 

compromise negotiations is likewise not admissible. 

This section does not require exclusion when the 

evidence is offered for another purpose, such as 

proving bias or prejudice of a witness, negativing a 

contention of undue delay, proving accord and 

satisfaction, novation or release, or proving an 

effort to compromise or obstruct a criminal 

investigation or prosecution.
No. 2020AP806 

12

result of the settlement."13 Morden, 235 Wis. 2d 325, ¶83. The 

obvious concern animating this exception is that plaintiffs will 

"shade their testimony against the interest of the non-settling 

tortfeasor." 7 Daniel D. Blinka, Wisconsin Practice Series: 

Wisconsin Evidence § 408.1 (4th ed. 2022).

¶25 The bias and prejudice exception, however, has limits. 

In Johnson v. Heintz, we explained that while Wis. Stat. 

§ 904.08 permits admission of certain types of settlementrelated evidence (such as the fact of settlement), it does not 

permit admission of settlement amounts. 73 Wis. 2d 286, 300, 

243 N.W.2d 815 (1976) ("To allow the admission of details 

including the amount of settlement as an exception to the rule 

would defeat the purpose of the rule and render it

meaningless."). The amount of settlement is so generally offlimits that its admission has been described as "taboo." Daniel 

J. LaFave, The Admissibility of Settlement Evidence in MultiDefendant Tort Cases, Wis. Law., June 1998, at 59; see also

Morden, 235 Wis. 2d 325, ¶99 n.15 ("Introducing settlement 

evidence is a potentially incendiary device, one that could lead 

the jury to conclude that the plaintiffs have received ample 

 

13 The dissent suggests Morden created a new "significant 

change in posture" exception to Wis. Stat. § 908.04. Dissent, 

¶¶62, 68. It did not. Morden simply says that "the prejudice 

or bias of a witness"——language straight out of the statute——

might be demonstrated by showing that a witness's testimony 

could be "significantly different as a result of the 

settlement." Morden v. Cont'l AG, 2000 WI 51, ¶83, 235 

Wis. 2d 325, 611 N.W.2d 659. 
No. 2020AP806 

13

compensation from the real malefactors and no further recovery 

is necessary." (quoting another source)). 

¶26 In this case, the central question is whether the 

circuit court erroneously exercised its discretion when it 

admitted the fact that the Shockleys settled with RSM and Curtis 

Mallet. Although the settlement amounts were introduced, it was 

the Shockleys——not Murphy Desmond——that did so. And the circuit 

court did not rule that the amount of settlement was admissible 

in its pre-trial decision. Indeed, the circuit court judge was 

shocked when the Shockleys brought the amount of settlement into 

evidence, later saying he "almost fell out of [his] chair." 

Thus, we limit our review to the fact of settlement and conclude 

the circuit court reasonably determined that the posture of the 

Shockleys' arguments changed significantly after the settlement 

and that some of the plaintiff's witnesses might be biased. 

This case involved both negligent (Murphy Desmond) and 

intentional (RSM and Curtis Mallet) tortfeasors; the Shockleys 

settled only with the latter. The circuit court appeared to 

recognize the somewhat unusual posture of this case where two of 

the three central players in the dispute settled out, leaving 

litigation against solely the third defendant who could now be 

portrayed as the main culprit. The circuit court was well aware 

how the Shockleys' story changed and what their incentives at 

trial now were.14 Take, for example, the Shockleys' opening 

 

14 On the morning of trial, the circuit court explained:

There is no doubt in this case that the posture of the 

intervening plaintiffs has changed as a result of the 
No. 2020AP806 

14

statement where they specifically argued that neither RSM nor 

Curtis Mallet committed intentional wrongdoing. The court 

reasonably determined that admission of the fact of settlement 

into evidence went straight to the credibility and potential 

bias of the Shockleys' witnesses, such as Sandy and Terry 

Shockley. 

¶27 This is not the first time we have affirmed a circuit 

court's decision to admit the fact of settlement into evidence 

due to witness bias. In Hareng v. Blanke, the plaintiff 

initially sued four defendants. 90 Wis. 2d 158, 162, 279 

N.W.2d 437 (1979). She settled with two of the four before 

trial. Id. At trial, counsel for one of the remaining 

defendants asked the plaintiff why one of the settled defendants 

was no longer a party. Id. at 167. The circuit court admitted 

the evidence despite an objection. Id. We affirmed this 

decision, reasoning that the evidence was admissible to show 

witness prejudice or bias because the plaintiff "had a financial 

interest in playing down the negligence of [the settled 

defendant] and emphasizing that of [the remaining defendants]." 

Id. at 168. So too here. 

 

Pierringer settlement. Instead of having the burden 

of proof and actively looking to prove the case 

against the settling parties, they have settled those 

claims and are now playing a defense on those claims 

and will be, no doubt, arguing for a lesser percentage 

of causal negligence on the part of these settled 

parties. That is clearly a change in posture. 
No. 2020AP806 

15

¶28 Moreover, the circuit court did not just permit the 

evidence without restriction. Before it was presented to the 

jury, the court gave a special instruction to use the settlement 

evidence only for credibility purposes and not as proof of fault 

or damages.15 That limiting instruction added a protective layer 

to ensure the statutory exception requiring an acceptable 

purpose was complied with. Our law presumes the jury followed 

this instruction. See State v. Hurley, 2015 WI 35, ¶90, 361 

Wis. 2d 529, 861 N.W.2d 174. 

¶29 Even given our conclusion, we reiterate as we did in 

Morden that this statutory exception should not be expansively 

construed. 235 Wis. 2d 325, ¶85. Circuit courts should 

exercise the utmost caution in determining whether to admit 

settlement evidence under Wis. Stat. § 904.08. See Morden, 235 

Wis. 2d 325, ¶85 ([T]he "Judicial Council Committee's Note to 

Rule 904.08 cites cases that 'admonish trial courts to be 

cautious in determining admissibility.'" (quoting another 

source)). Our holding today should not be taken by circuit 

 

15 The court instructed the jury that it,

must not consider this evidence about the settlements 

as evidence of the truth of the claims against those 

defendants. You may consider this evidence only to 

the extent that you believe it may bear on the 

credibility of the testimony of any witness including 

the plaintiffs and the settling parties. Any award of 

damages to any plaintiff must be made without taking 

into account any amounts the plaintiff may have 

received as a result of that settlement and any 

determination of percentages of fault attributed to 

any party must be made without regard to that 

settlement.
No. 2020AP806 

16

courts as a license to admit all, or even most, settlement 

evidence. After all, the statute merely permits, but does not 

require, admission under certain circumstances. Id., ¶82.

¶30 In conclusion, the circuit court did not erroneously 

exercise its discretion when it determined that witness bias was 

a significant risk in light of the dramatically altered posture 

of this case following settlement with two central tortfeasors. 

It supported this limited admission of the fact of settlement 

with a cautionary and clarifying instruction to the jury. Based 

on the unique facts of this case, we hold the circuit court did 

not erroneously exercise its discretion by admitting the fact of 

settlement into evidence. 

B. Discussion of Settlement Evidence at Closing Arguments

¶31 The Shockleys also fault the circuit court for 

permitting Murphy Desmond to argue during its closing argument 

over their objection that the settlement evidence effectively 

disproved the Shockleys' claims. They contend this error 

warrants a new trial. While we agree the argument crossed the 

line, we conclude the circuit court did not erroneously exercise 

its discretion in denying the Shockleys' motion for a new trial.

1. Murphy Desmond's Argument Was Improper

¶32 As already explained, Wis. Stat. § 904.08 prohibits 

parties from using settlement evidence to "prove liability for 

or invalidity of [a] claim or its amount." Consistent with the 

circuit court's instruction, Murphy Desmond's closing argument 
No. 2020AP806 

17

addressed the Shockley's credibility due to their settlement 

with other tortfeasors and consequent shift in position. 

However, we agree with the Shockleys that counsel for Murphy 

Desmond strayed at one point when he said: "Even though 

everything that [the Shockleys] alleged against Curtis Mallet 

has been proven. Even though the settlement, in my opinion, is 

an acknowledgment that they've been proven." This statement 

appears aimed at liability rather than credibility. In effect, 

counsel seemed to claim that the Shockleys' allegations against 

RSM and Curtis Mallet had already been proven by virtue of the 

settlement and, therefore, Murphy Desmond was not liable.16 

While we grant circuit courts considerable discretion in 

"determining the propriety of [a closing] argument,"17 this 

crossed the line. The circuit court erroneously exercised its 

discretion when it permitted counsel's comment, which ran 

counter to its prior evidentiary ruling and instruction to the 

jury. That said, we still must determine whether the error 

warranted a new trial.

 

16 Counsel's statement is similar to an argument made in a 

Delaware case, Atwell v. RHIS, Inc., where the non-settled 

defendant remarked in closing that the settled defendant "fell 

on the sword." 974 A.2d 148, 150 (Del. 2009). The Delaware 

Supreme Court observed that the comment "had the 'purpose of 

persuading the jury that the persons to blame for the accident 

had already admitted liability, raising the question that the 

plaintiff's claim against [the nonsettling defendant] might be 

invalid . . . .'" Id. at 154 (alteration in original) (quoting 

another source). We infer likewise in this case. 

17 State v. Burns, 2011 WI 22, ¶48, 332 Wis. 2d 730, 798 

N.W.2d 166. 
No. 2020AP806 

18

2. The Improper Argument Did Not Warrant a New Trial

¶33 Following trial, the Shockleys pointed to the error in 

closing argument and requested a new trial.18 A new trial is 

appropriate when it "'affirmatively appear[s]' that the remarks 

prejudiced the complaining party." Wausau Underwriters Ins. Co. 

v. Dane County, 142 Wis. 2d 315, 329, 417 N.W.2d 914 (Ct. App. 

1987) (quoting Roeske v. Schmitt, 266 Wis. 2d 557, 572, 64 

N.W.2d 394 (1954)). A circuit court should grant such a motion 

when it determines that, but for the improper argument, "the 

verdict reflects a result which in all probability would have 

been more favorable to the complaining party." Wagner v. Am. 

Fam. Mut. Ins. Co., 65 Wis. 2d 243, 250, 222 N.W.2d 652 (1974). 

A circuit court's decision to grant or deny a motion for a new 

trial is discretionary; we reverse only if the court erroneously 

exercised its discretion. Id. at 249.

¶34 The circuit court denied the Shockleys' request for a 

new trial because, in its view, the error was harmless 

considering the court's jury instruction and the multiple days 

of testimony supporting the jury's ultimate finding. This was a 

decision a reasonable judge could reach supported by the record 

and the relevant law. Murphy Desmond's improper comment 

 

18 Murphy Desmond contends the Shockleys forfeited this 

argument because they failed to move for a mistrial at the time 

of the error and only did so in their post-trial motion. The 

Shockleys respond that they did not need to move for a mistrial 

because their objection was overruled. We need not reach this 

forfeiture argument because we agree with Murphy Desmond that 

the circuit court did not erroneously exercise its discretion 

when denying the post-trial motion for a mistrial.
No. 2020AP806 

19

amounted to a single dark cloud on an otherwise sunny day. The 

statement comprised two sentences in almost 80 pages of closing 

argument transcript. Following the Shockleys' objection, 

counsel for Murphy Desmond backed away from any improper use of 

the evidence and emphasized that the settlement wasn't the "most 

important issue in this case." 

¶35 Moreover, the circuit court specifically instructed 

the jury that it could only use the settlement evidence for 

credibility purposes, and not as proof of fault or damages. As 

we've stressed many times before: "We assume that 'a properly 

given admonitory instruction is followed' and that the 'jury 

acted according to law.'" State v. Pitsch, 124 Wis. 2d 628, 645 

n.8, 369 N.W.2d 711 (1985) (quoting other sources). We see no 

reason to abandon that presumption here due to one improper 

statement in a closing argument that was otherwise consistent 

with the credibility-focused limiting instruction previously 

given. 

¶36 As a final point, this case is as good as any for 

emphasizing why we afford circuit courts discretion in 

determining whether to grant a new trial. This litigation 

spanned 11 years start-to-finish, underscoring its procedural 

and factual complexity. Trial itself lasted ten days. While a 

circuit court's decision to deny a motion for a new trial is not 

bullet-proof, it is right and proper to entrust this judgment 

call to those most intimately familiar with the case. 

¶37 In view of all of this, we hold that the circuit court 

did not erroneously exercise its discretion when it denied the 
No. 2020AP806 

20

Shockleys' motion for a new trial based on the improper remark 

during closing. 

C. Admission of the Superseded Complaint

¶38 Next, the Shockleys argue the circuit court 

erroneously admitted its prior, superseded complaint. They 

further contend that the error was not harmless because Murphy 

Desmond used the original allegations throughout trial to 

suggest RSM and Curtis Mallet were the true culprits. Murphy 

Desmond responds that admission of the superseded complaint was 

not error, but even if it was, it was harmless because it was 

consistent with the Shockleys' position at trial. Regardless of 

whether admission of the original complaint was in error, we 

conclude it was harmless. 

¶39 Evidentiary decisions are subject to review for an 

erroneous exercise of discretion, but "a circuit court's 

erroneous exercise of discretion does not warrant a new trial if 

the error was harmless." Weborg v. Jenny, 2012 WI 67, ¶43, 341 

Wis. 2d 668, 816 N.W.2d 191. In other words, a new trial should 

only be granted where the error affected a substantial right of 

the affected party. Wis. Stat. § 805.18(2); Martindale, 246 

Wis. 2d 67, ¶31. The test is the same in both civil and 

criminal cases: whether "it appears 'beyond a reasonable doubt 

that the error complained of did not contribute to the verdict 

obtained.'" Hannemann v. Boyson, 2005 WI 94, ¶57, 282 

Wis. 2d 664, 698 N.W.2d 714 (quoting another source); see

Chapman v. California, 386 U.S. 18, 24 (1967).
No. 2020AP806 

21

¶40 The alleged prejudice that flowed from admission of 

the complaint centered on the jury discovering the Shockleys' 

original allegations against RSM and Curtis Mallet. But the 

fact of settlement, admitted for a limited purpose as previously 

explained, accomplished a similar result. The jury already knew 

the Shockleys originally sued RSM and Curtis Mallet, settled, 

and then focused their efforts on Murphy Desmond. In other 

words, neither admission nor Murphy Desmond's use of the 

superseded pleadings poisoned the well——at least not enough for 

us to find beyond a reasonable doubt that juror knowledge of the 

precise allegations in the original complaint contributed to the 

outcome. Hannemann, 282 Wis. 2d 664, ¶57. Absent this, the 

Shockleys offer nothing else to suggest their substantial rights 

were affected. Therefore, admission of the superseded 

complaint, if erroneous, was harmless.

D. Indemnity

¶41 Finally, Sandy Shockley and Shockley Holdings contend 

Murphy Desmond is not entitled to indemnity for its negligence. 

Indemnity is a question of law we review de novo. Fleming, 131 

Wis. 2d at 127. Understanding this issue requires unpacking 

indemnification, Pierringer releases, and how our decision in 

Fleming developed the relationship between the two. 

¶42 "Indemnification is a vehicle by which one party or 

defendant to a lawsuit attempts to shift the entire 

responsibility for a loss or injury to another party." Artisan 

& Truckers Cas. Co. v. Thorson, 2012 WI App 17, ¶27, 339 
No. 2020AP806 

22

Wis. 2d 346, 810 N.W.2d 825 (quoting another source). The point 

"is to ensure that the losses are borne by the party responsible 

for the damages." Id. 

¶43 Pierringer releases are settlement agreements between 

a plaintiff and some, but not all, defendants in a case. See

Teske v. Wilson Mut. Ins. Co., 2019 WI 62, ¶11 n.6, 387 

Wis. 2d 213, 928 N.W.2d 555; Pierringer v. Hoger, 21 

Wis. 2d 182, 184-85, 124 N.W.2d 106 (1963). A Pierringer

release satisfies "that portion of the plaintiff's cause of 

action for which the settling joint tortfeasor is responsible, 

while at the same time reserving the balance of the plaintiff's 

cause of action against a nonsettling joint tortfeasor." Imark 

Indus., Inc. v. Arthur Young & Co., 148 Wis. 2d 605, 621, 436 

N.W.2d 311 (1989). In Pierringer, we held that such releases 

impute onto the settling plaintiff any liability in contribution 

the settled defendants may owe to the non-settled defendants. 

21 Wis. 2d at 188-89. That is, any obligation the settling 

party may have to pay its proportionate share of the liability 

is extinguished by virtue of the release and rests with the 

plaintiff. Id.

¶44 Now we turn to our decision in Fleming. Prior to that 

case, we had held that those guilty of intentional misconduct 

are not entitled to contribution from parties engaging in 

negligent conduct. See Jacobs v. Gen. Accident Fire & Life 

Assurance Corp., 14 Wis. 2d 1, 5, 109 N.W.2d 462 (1961); Zurn v. 

Whatley, 213 Wis. 365, 372, 251 N.W. 435 (1933). In Fleming, we 

extended this line of reasoning and held that a negligent 
No. 2020AP806 

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tortfeasor has a right to indemnification from an intentional 

joint tortfeasor. 131 Wis. 2d at 130. We reasoned that the 

full responsibility for the loss should be placed on the 

intentional tortfeasor because doing so would deter conduct 

"society considers to be substantially more egregious than 

negligence." Id. Fleming further held that a Pierringer

release imputes onto the plaintiff any indemnity the settled 

defendants owe the non-settled defendants. Id. at 131. In 

other words, the plaintiff who executes a Pierringer release 

effectively stands in the shoes of the settled defendants. So 

if the non-settled defendants are entitled to indemnity from the 

settled defendants, the responsibility for the loss shifts from 

the settled defendants to the plaintiff.19 

¶45 Here's how all of this works in this case. The jury 

found Murphy Desmond negligent, so it is entitled to 

indemnification from liability that is joint with any 

intentional tortfeasors. The jury also found that RSM and 

Curtis Mallet committed intentional torts. Therefore, under 

Fleming, RSM and Curtis Mallet bear the full responsibility of 

any joint liability arising out of their intentional conduct, 

including the negligent conduct by Murphy Desmond. But both RSM 

and Curtis Mallet signed a Pierringer release with the 

Shockleys. That means that, per Fleming, any indemnity RSM and 

 

19 We adopted this rule in the interest of judicial economy—

—namely, it would be inefficient to order a judgment against a 

settled defendant only to have the plaintiff satisfy it himself. 

Fleming v. Thresherman's Mut. Ins. Co., 131 Wis. 2d 123, 131, 

388 N.W.2d 908 (1986).
No. 2020AP806 

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Curtis Mallet owe Murphy Desmond is imputed onto Sandy Shockley 

and Shockley Holdings. In short, so long as the liability is 

joint, Murphy Desmond is entitled to indemnification from RSM 

and Curtis Mallet. But Sandy Shockley and Shockley Holdings, by 

virtue of the Pierringer release, now stand in the shoes of RSM 

and Curtis Mallet. So Murphy Desmond owes nothing further to 

them. 

¶46 Understanding this, Sandy Shockley and Shockley 

Holdings argue Fleming's framework does not apply here because 

Murphy Desmond's negligence was not attributable to RSM and 

Curtis Mallet's intentional misrepresentations. In other words, 

they argue the malfeasance here was not wholly joint, pointing 

to our decision in Imark as analogous to the facts in this case. 

148 Wis. 2d 605. 

¶47 In Imark, a corporation sued an accounting firm for 

negligent misrepresentation based on several audits. Id. at 

613. That accounting firm then sued three corporate officers 

for intentional misrepresentations related to the audits. 

Id. at 614. The jury allocated the negligence among the parties 

and also found that the corporate officers committed intentional 

misrepresentations. Id. at 614-15. We observed that the record 

contained specific evidence of negligence by the firm that was 

"unaffected" by any intentional misrepresentations by the 

corporate officers. Id. at 624. So we remanded the case for 

the jury to determine what portion of the firm's liability was 

attributable to its reliance on the intentional 

misrepresentations, and what was unattributable. Id. at 628-29. 
No. 2020AP806 

25

Sandy Shockley and Shockley Holdings argue a remand is similarly 

required here because the jury did not determine what portion of 

Murphy Desmond's negligence was unattributable to RSM and Curtis 

Mallet's intentional misrepresentations.

¶48 Unlike in Imark, the record before us reveals no such 

ambiguity. The circuit court correctly observed that the 

Shockleys never alleged——nor proved at trial——that Murphy 

Desmond had liability separate from RSM and Curtis Mallet. In 

fact, Sandy Shockley and Shockley Holdings have failed to point 

to any such evidence before the circuit court, the court of 

appeals, or before us. We simply see nothing in the record that 

shows anything other than joint liability. 

¶49 Therefore, the general rule under Fleming applies. 

Intentional tortfeasors RSM and Curtis Mallet must indemnify 

Murphy Desmond due to their joint liability. But the Pierringer

release signed with RSM and Curtis Mallet imputes the indemnity 

owed by them to the plaintiffs——including Sandy Shockley and 

Shockley Holdings.20 Fleming, 131 Wis. 2d at 131. Thus, even 

though the jury found Murphy Desmond negligent, it owes no 

damages to Sandy Shockley and Shockley Holdings; the circuit 

court correctly dismissed their claims against Murphy Desmond. 

 

20 Sandy Shockley and Shockley Holdings argue in passing 

that this rule is "unworkable and unjust," pointing to several 

jurisdictions that have abandoned it. But they "take no 

position" on whether the rule should in fact be abandoned. 

Absent an argument asking to revisit the rule, we decline to do 

so.
No. 2020AP806 

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III. CONCLUSION

¶50 In the end, we find the Shockleys' four arguments 

unavailing. We hold the circuit court properly admitted the 

fact of settlement into evidence for a limited purpose and 

denied the Shockleys' motion for a new trial based on the 

improper remark during closing. Regarding the superseded 

complaint, we hold that, even if its admission was erroneous, it 

was harmless. Finally, we hold that the circuit court correctly 

concluded Murphy Desmond is entitled to indemnification and 

therefore owes no damages to Sandy Shockley and Shockley 

Holdings.

By the Court.—The decision of the court of appeals is 

affirmed.
No. 2020AP806.akz

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¶51 ANNETTE KINGSLAND ZIEGLER, C.J. (dissenting). 

Wisconsin has a strong public policy encouraging litigants to 

voluntarily resolve their disputes through settlement agreements 

rather than the judicial process. This policy is furthered by 

Wis. Stat. § 904.08, which prohibits the admission of settlement 

evidence to prove a claim or its amount, with some narrow 

exceptions for other purposes. Because the majority's 

interpretation of these exceptions swallows the rule and creates 

a back door for litigants to introduce evidence of Pierringer1

releases for the prohibited purposes, I respectfully dissent. 

¶52 The circuit court in this case erroneously permitted 

Murphy Desmond to introduce settlement evidence as proof that 

the settling defendants were the "true culprits" and as proof 

that the Shockleys had already been fully compensated for their 

losses. Murphy Desmond claims it introduced this evidence for a 

different purpose——to show that the settlement caused the 

Shockleys to have a "significant change in posture." But such 

an exception would apply to every Pierringer release, swallowing 

the rule that settlement agreements are generally inadmissible 

and opening a back door for litigants to introduce settlement 

evidence for an improper purpose, as occurred here. This error 

compounded when the circuit court erroneously permitted defense 

counsel to explicitly argue the settlement evidence was proof 

that the settling defendants were at fault rather than Murphy 

Desmond. At that point, the settlement evidence and improper 

 

1 Pierringer v. Hoger, 21 Wis. 2d 182, 124 N.W.2d 106 

(1963). 
No. 2020AP806.akz

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argument so infected the trial that no jury instruction could 

save it. I would reverse the court of appeals and remand for a 

new trial. 

I. FACTUAL BACKGROUND

¶53 The majority vastly undersells the extent to which 

Murphy Desmond's counsel exploited the settlement evidence at 

trial. Defense counsel first discussed that evidence at length 

near the beginning of his opening statement: 

The first question is what are the factual 

questions that need to be resolved in this case? And 

the first and single most important factual question 

that needs to be resolved is this: Who did the 

Shockleys and the other Shockley Communications 

Corporation shareholders really look to for advice on 

the tax risks and tax advantages of this transaction? 

Closely related to that, and I think important to 

that, is the question that what does it mean that I'm 

now going to tell you that at the outset of this case 

the Shockleys not only sued my clients but they sued 

RSM McGladrey and they sued Curtis Mallet.

And that's the first time you heard that, because 

it's a fact that they want to run away from as far as 

they can, as fast as they can. They not only sued RSM 

McGladrey, Curtis Mallet, and the individuals who were 

associated with them, they not only alleged that, as 

they have alleged against us, that they were negligent 

in providing professional services to them, but they 

specifically alleged that each of those persons and 

entities defrauded them. That they lied to them and 

misrepresented things to them. And that in specific 

reliance upon the lies, the frauds, the 

misrepresentations that those two defendants made, 

they entered into this transaction. 

And after they made those allegations, they've 

now withdrawn them. They filed a new Complaint, a new 

paper to start this lawsuit, to continue this lawsuit, 

which is what I would like to call the make-pretend 

document. It's the document that pretends that --
No. 2020AP806.akz

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[Plaintiff's counsel objects as argumentative and is

overruled.]

[Plaintiff's counsel] didn't tell you that, but 

they sued these other people, the ones they say now 

they didn't rely on, the ones they say were just sort 

of on the sideline, they sued them. They claimed they 

defrauded them. Not that they were careless but they 

frauded them. Then they settled with them. And now 

the lawsuit they obviously want to present to you in 

this search for the truth we have here today is a 

lawsuit in which they now claim it's my clients who 

did this.

¶54 Defense counsel later cross-examined Sandy Shockley 

and mentioned the settlement 13 times. He later asked Terry 

Shockley,

Your wife testified when she was on the stand last 

week that as a result of the settlement that was made 

with the other defendants, you ended up after expenses 

and so on out of the $13 million, you got between $6 

and $8 million being available from that settlement.

¶55 Defense counsel also asked Jenny Johnson Ware, the 

Shockleys' lawyer from the IRS litigation, "How much money do 

you understand the Shockleys have sitting in a bank account 

somewhere as a result of the settlement with the other 

defendants." He further asked if it was true that "the 

Shockleys have only paid [the IRS] $2 million" "[e]ven though 

they, according to Mrs. Shockley's testimony, have several 

millions of dollars left over from the settlement they had from 

the other defendants." 

¶56 Finally, defense counsel returned to the settlement 

and further emphasized its significance during closing argument: 

And [plaintiff's counsel] should be blushing, because 

he's the one who got up at the beginning of this trial 

and talked about this case as if they had never 

sued -- they had never accused McGladrey and Curtis 
No. 2020AP806.akz

4

Mallet of doing anything wrong. Talked about this 

trial as if there was no issue in this case whatsoever 

about whether McGladrey and Curtis Mallet had done 

anything wrong. Didn't tell you that they'd settled 

with Curtis Mallet and McGladrey. Didn't tell you 

they got enormous amounts of money because they're the 

true culprits here, of course. And didn't tell you 

that because they settled with them. His clients had 

night and day changed their allegations to drop all 

the allegations against those people and now take the 

posture that he's taking now, that this is, 

essentially, all our fault. Even though everything 

that his clients alleged against Curtis Mallet has 

been proven. Even though the settlement, in my 

opinion, is an acknowledgment that they've been 

proven.

(emphases added).

¶57 The fact of the matter is Murphy Desmond heavily 

relied on the settlement evidence throughout the trial. It was 

one of Murphy Desmond's most "important" pieces of evidence for 

resolving the question, "Who did the Shockleys . . . really look 

to for advice . . . ?" The majority simply fails to grasp the 

extent to which the settlement pervaded the trial.

II. STANDARD OF REVIEW

¶58 Though reviewing an evidentiary decision, we 

nonetheless review the circuit court's application of a statute. 

"The interpretation and application of a statute presents a 

question of law that this court decides independently of the 

circuit court," and "[i]t follows that this court decides 

whether the circuit court applied the proper legal standard 

under Wis. Stat. § [904.08] in the first instance 

independently." Seifert v. Balink, 2017 WI 2, ¶89, 372 

Wis. 2d 525, 888 N.W.2d 816. 
No. 2020AP806.akz

5

¶59 "We [also] review a circuit court's decision to deny a 

motion for a new trial under an erroneous exercise of discretion 

standard." Id., ¶139. 

III. ANALYSIS

A. Admission of Settlement Evidence.

¶60 Under Wis. Stat. § 904.08, settlement evidence "is not 

admissible to prove liability for or invalidity of the claim or 

its amount." This rule reflects "concerns that such evidence 

has marginal probative value that is categorically outweighed by 

the public policy of encouraging the settlement of disputes 

short of trial." 7 Daniel Blinka, Wisconsin Practice Series: 

Wisconsin Evidence § 408.1 (4th ed. 2022). It is for this 

reason we have described the introduction of settlement 

evidence——particularly in cases of multi-defendant litigation——

as "a potentially incendiary device, one that could lead the 

jury to conclude that the plaintiffs have received ample 

compensation from the real malefactors and no further recovery 

is necessary." Morden v. Continental AG, 2000 WI 51, ¶99 n.15, 

235 Wis. 2d 325, 611 N.W.2d 659.

¶61 Our statutes do provide an exception to this general 

prohibition on settlement evidence, permitting circuit courts to 

"not require exclusion when the evidence is offered for another 

purpose, such as proving bias or prejudice of a witness." Wis. 

Stat. § 904.08. However, this exception must be narrowly 

construed and applied cautiously. For example, we concluded in 

Johnson v. Heinz, 73 Wis. 2d 286, 243 N.W.2d 815 (1976), that 

the exception does not "allow[] testimony concerning details of 
No. 2020AP806.akz

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the compromise settlement . . . for the purpose of showing bias 

or prejudice . . . . To allow the admission of details including 

the amount of settlement as an exception to the rule would 

defeat the purpose of the rule and render it meaningless." Id.

at 300. 

¶62 The majority erroneously endorses the interpretation 

of Wis. Stat. § 904.08 expressed in Morden, which permits 

admission of settlement evidence where "the posture of a 

settling party was significantly different as a result of the 

settlement." Morden, 235 Wis. 2d 325, ¶83. Not only does this 

exception have no basis in the statutory text, but it swallows 

§ 904.08's general exclusion of settlement evidence in all cases 

involving a Pierringer release. 

¶63 A Pierringer release is a kind of settlement in cases 

involving multiple defendants. It "operates as a satisfaction 

of that portion of the plaintiff's cause of action for which the 

settling joint tortfeasor is responsible, while at the same time 

reserving the balance of the plaintiff's cause of action against 

a nonsettling tortfeasor." Teske v. Wilson Mut. Ins. Co., 2019 

WI 62, ¶11 n.6, 387 Wis. 2d 213, 928 N.W.2d 555 (quoting Imark 

Indus., Inc. v. Arthur Young & Co., 148 Wis. 2d 605, 621, 436 

N.W.2d 311 (1989)). Such agreements permit settling defendants 

to terminate their involvement in litigation completely because 

Pierringer releases "provide[] that the plaintiff 'will assume 

or satisfy that portion of the liability that is determined to 

be the responsibility of the settling joint tortfeasor.'" Id.

(quoting Imark Indus., 148 Wis. 2d at 621). This ensures 
No. 2020AP806.akz

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settling defendants will not have to litigate against 

nonsettling defendants to determine contribution. That is left 

to the plaintiff and the nonsettling defendants. Pierringer

releases are therefore attractive because they end all 

involvement in litigation for settling defendants. 

¶64 With regard to Pierringer releases, the "significant 

change in posture" exception swallows the rule. Every 

Pierringer release substantially changes the plaintiff's 

posture. The plaintiff takes on the responsibility of arguing 

that the nonsettling defendants are not entitled to contribution 

in every single case involving a Pierringer release. Even the 

circuit court in this case recognized what is essentially a per 

se rule of admissibility in settlement cases: "That's the whole 

point of a Pierringer. The burden shifts." By expansively 

construing the exception to include a "significant change in 

posture," the majority makes evidence of Pierringer releases 

generally admissible and removes plaintiffs' incentives to 

settle. The majority therefore "defeat[s] the purpose of the 

rule and render[s] it meaningless." Johnson, 73 Wis. 2d at 300.

¶65 Other courts too have recognized the dangers of 

broadly construing the exception to the exclusion of settlement 

evidence in this context. Rule 408 of the Federal Rules of 

Evidence, similar to our own statute, prohibits admission of 

settlement evidence, except "[t]he court may admit this evidence 

for another purpose, such as proving a witness's bias or 

prejudice." As one court observed, "Despite such a sweeping 

statement, care should be taken that an indiscriminate and 
No. 2020AP806.akz

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mechanistic application of this 'exception' to Rule 408, does 

not result in undermining the rule's public policy 

objective . . . ." Young v. Verson Allsteel Press Co., 539 

F. Supp. 193, 196 (E.D. Pa. 1982) (quoting 2 J. Weinstein & M. 

Berger, Weinstein's Evidence § 408(05) (1978)) (concluding an 

argument that "introducing evidence of settlement is not to 

prove the validity or invalidity of the claim or its 

amount, . . . even if true, would not signal an end to our 

inquiry"). It is true that "state courts have charted various 

courses in the area, ranging from, complete disclosure of the 

fact of settlement with a joint tortfeasor and the amount, to 

prohibition of any disclosure of such facts." Id. However, 

especially in light of comparative negligence doctrine, "the 

recent trend among the states in interpreting their respective 

interrelated comparative negligence and joint tortfeasor 

contribution statutes is to place any evidence of a plaintiff's 

settlement with a joint tortfeasor beyond the jury's grasp." 

Id. (collecting cases). 

¶66 Under more appropriately exacting scrutiny, it is 

clear that the evidence of the Shockleys' settlement agreement 

was improperly admitted. The circuit court explained that it 

was "admitting [the settlement evidence] on the issues of the 

credibility of plaintiffs and their overall posture in the 

lawsuit." Though questionable whether the court should have 

admitted the settlement evidence on the issue of credibility, 

admitting it to show the Shockleys' "overall posture" was 

erroneous. 
No. 2020AP806.akz

9

¶67 By discussing how the settlement evidence affected the 

"posture" of the plaintiffs, defense counsel used the settlement 

evidence both to "prove liability for . . . the claim [and] its 

amount." Wis. Stat. § 904.08. In opening argument, defense 

counsel referred to the settlement evidence as "important" to 

deciding "the first and single most important factual question," 

which was, "Who did the Skockleys . . . really look to for 

advice on the tax risks and tax advantages of this transaction?" 

Not only did defense counsel use this "significant change in 

posture" exception to prove that the Shockleys actually relied 

on the settling defendants, but he also used it to prove the 

amount of the claims by demonstrating that the Shockleys had 

already been fully compensated for their damages.2 He asked 

several witnesses about the amount of settlement, noting that 

the Shockleys "have several millions of dollars left over from 

the settlement." All of this was accomplished under the guise 

of demonstrating the Shockleys' "significant change in posture," 

which the statute prohibits. 

¶68 This case illustrates that the judicially-created 

"significant change in posture" exception to Wis. Stat. § 904.08 

is a loophole permitting litigants to present settlement 

evidence for the very purposes the rule explicitly prohibits. 

Such an exception to the general rule that settlement evidence 

 

2 The majority repeatedly states that it was the Shockleys 

who initially introduced the settlement amount. Majority op., 

¶¶16, 26. The majority appears to confuse that initial 

introduction with Murphy Desmond's later introducing it to prove 

the amount of the Shockleys' claim, which Wis. Stat. § 904.08 

explicitly prohibits. 
No. 2020AP806.akz

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is inadmissible swallows the rule, making evidence of Pierringer

releases admissible in every instance. The circuit court 

erroneously exercised its discretion by admitting the settlement 

evidence under this exception. 

B. Improper Argument

¶69 Even if the circuit court did properly admit the 

settlement evidence——which it did not——the circuit court 

erroneously exercised its discretion by not granting a new 

trial.

¶70 As an initial matter, defense counsel's remarks during 

closing argument were improper, and the circuit court 

erroneously exercised its discretion by overruling the objection 

to those remarks. Defense counsel argued to the jury that 

plaintiffs' counsel "[d]idn't tell you that they'd settled with 

Curtis Mallet and McGladrey. Didn't tell you they got enormous 

amounts of money because they're the true culprits here." 

(emphasis added). He even said that the settlement "is an 

acknowledgment" that "everything [the Shockleys] alleged against 

Curtis Mallet has been proven." 

¶71 It is hard to imagine a more direct way defense 

counsel could have argued that the settlement "prove[d] 

liability or invalidity of the claim or its amount." Wis. Stat. 

§ 904.08. Yet, the circuit court found this line of argument 

proper because the circuit court "thought his argument wasn't 

that it was evidence of what their liability is. It was 

evidence of what you thought their liability was. And that's 

the whole point is the credibility of the plaintiffs' case." 
No. 2020AP806.akz

11

This explanation demonstrates that the circuit court 

fundamentally misunderstood both Murphy Desmond's case and the 

rules of Wis. Stat. § 904.08. The circuit court erroneously 

exercised its discretion by permitting this line of argument. 

¶72 In any event, the majority concludes the circuit court 

properly denied the request for a new trial because the 

"improper comment amounted to a single dark cloud on an 

otherwise sunny day." Majority op., ¶34. Not so. The improper 

comment was instead the last jolting lightning bolt at the end 

of a long storm. The circuit court and the majority examined 

the improper comment from the perspective of a person who 

listened to the closing arguments and nothing else. But the 

jury sat through a ten-day-long trial, during which defense 

counsel referenced the settlement agreement relentlessly. He 

promised the jury during opening statements that the settlement 

evidence would be "important" for determining who was really at 

fault, and he brought it full circle in closing argument. In 

context, the majority's characterization of the comment as a 

"single dark cloud" is purely fanciful. 

¶73 The circuit court's instructions to the jury do not 

change the fact that this improper line of argument prejudiced 

the Shockleys. It is true that "[w]hen a circuit court gives a 

proper cautionary instruction, appellate courts presume that the 

jury followed that instruction and acted in accordance with the 

law." State v. Gary M.B., 2004 WI 33, ¶33, 270 Wis. 2d 62, 676 

N.W.2d 475. However, "in a case where there is a good reason to 

believe that injury has been done to the adverse party by the 
No. 2020AP806.akz

12

introduction of the improper testimony [or argument], 

notwithstanding the instruction of the court to disregard it, [] 

a new trial should be ordered." State Bank of Wis. v. Dutton, 

11 Wis. 371, 373–74 (1860). 

[T]here may be cases in which the [improper evidence 

or argument] which has been introduced is of a nature 

so well adapted to make such an impression on the 

minds of the jury, that instructions to disregard it 

cannot well have their legitimate effect; and there 

may be cases where, after the admission of such 

[evidence or argument], the result of the trial 

indicates that it must have had an improper operation.

Id. at 373. This is one such case. Defense counsel made the 

settlement agreement a central part of the case from the get-go, 

referencing it wherever possible and intimating to the jury that 

the settling defendants were at fault. Given this steady 

drumbeat throughout trial, it is unsurprising that the jury 

found RSM and Curtis Mallet to have a combined amount of 

negligence six times greater than that of Murphy Desmond. It 

therefore "'affirmatively appear[s]' that the remarks 

prejudiced" the Shockleys, and the circuit court erroneously 

exercised its discretion by not granting a new trial. Seifert, 

372 Wis. 2d 525, ¶139 (quoting Wausau Underwriters Ins. Co. v. 

Dane County, 142 Wis. 2d 315, 329–50, 417 N.W.2d 914 (Ct. App. 

1987)). 

IV. CONCLUSION

¶74 Parties attempting to resolve their disputes without 

turning to the judicial process need assurance that those 

attempts will not later be used against them. This is 

especially true for plaintiffs entering Pierringer releases in 
No. 2020AP806.akz

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multi-defendant litigation, as they expect to go to trial with 

other nonsettling defendants. The majority reduces the 

assurance in Wis. Stat. § 904.08 to nothing more than a 

parchment barrier, permitting settlement evidence in this case 

to be admitted for the very purposes the statute prohibits under 

the guise of demonstrating a "significant change in posture." 

The majority compounds this error by minimizing the improper 

comments during closing argument and ignoring their context. 

¶75 For these reasons, I respectfully dissent. 

¶76 I am authorized to state that Justices PATIENCE DRAKE 

ROGGENSACK and REBECCA GRASSL BRADLEY join this dissent. 
No. 2020AP806.akz

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