COURT OF APPEALS

DECISION

DATED AND FILED

October 12, 2022

Sheila T. Reiff

Clerk of Court of Appeals

NOTICE

This opinion is subject to further editing. If 

published, the official version will appear in 

the bound volume of the Official Reports. 

A party may file with the Supreme Court a 

petition to review an adverse decision by the 

Court of Appeals. See WIS. STAT. § 808.10 

and RULE 809.62. 

Appeal No. 2019AP1651 Cir. Ct. No. 2013CV517

STATE OF WISCONSIN IN COURT OF APPEALS

DISTRICT II

BACKUS ELECTRIC, INC.,

 PLAINTIFF-RESPONDENT,

 V.

HUBBARTT ELECTRIC, INC., JOHN M. LEPICH AND JOSEPH D.

STAUFFER,

 DEFENDANTS,

JASON L. HUBBARTT,

 DEFENDANT-APPELLANT.

APPEAL from a judgment of the circuit court for Manitowoc

County: MARK ROHRER, Judge. Affirmed. 

Before Gundrum, P.J., Neubauer and Stark, JJ.
No. 2019AP1651

2

Per curiam opinions may not be cited in any court of this state as precedent 

or authority, except for the limited purposes specified in WIS. STAT. RULE 809.23(3). 

¶1 PER CURIAM. Jason L. Hubbartt appeals a judgment awarding 

Backus Electric, Inc. $555,562 in compensatory damages and $1,000,000 in 

punitive damages after a jury found that Hubbartt breached his fiduciary duty to 

Backus. Hubbartt argues that: (1) the circuit court erred by allowing Backus’s 

expert witness to testify; (2) there was insufficient evidence to support the jury’s 

verdict on causation and the amount of damages; (3) the award of punitive 

damages was unwarranted and excessive; and (4) a new trial is warranted in the 

interests of justice because the real controversy was not fully tried. For the 

reasons that follow, we affirm. 

¶2 Don Backus started Backus Electric, Inc. in 1981. Hubbartt, an 

electrician, began work for Backus in 1999, and in 2006, was made vice president. 

Backus thought of Hubbartt as the son he never had, an heir apparent who would 

eventually purchase Backus Electric. The sale of the business was expected to 

fund the retirement of Don Backus and his wife, Mary Jane. In 2011 and 2012, 

Backus and Hubbartt began discussing price, valuation, and financing. They 

reached an impasse in 2013. 

¶3 In early 2013, Hubbartt set up an email for himself using the domain 

name of “hubbarttelectric.com.” He began doing electrical work on the side and 

sent out invoices under the name Hubbartt Electric. Hubbartt bought three work 

vans under the name Hubbartt Electric and purchased a commercial property. He 

transferred to his personal computer nearly 100 Backus Electric work files. All of 

this was unknown to Backus and his wife. 
No. 2019AP1651

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¶4 Mary Jane Backus discovered some of Hubbartt’s activities on or 

around April 10, 2013, when she came across a Hubbartt Electric invoice in his 

Backus work truck. This led to a confrontation between Don Backus and 

Hubbartt. Though Hubbartt told Backus he would continue to work for Backus 

Electric, he officially formed Hubbartt Electric, Inc. that night, while still 

employed as Backus’s vice president. 

¶5 The relationship between Backus and Hubbartt quickly deteriorated. 

In April 2013, Backus terminated Hubbartt’s employment and Hubbartt continued 

his work at Hubbartt Electric. Two other Backus employees, John Lepich and 

Joseph Stauffer, quit Backus and joined Hubbartt Electric. In a matter of weeks, 

Hubbartt Electric took Backus’s best clients. The next year, Backus’s company 

shut down. 

¶6 Backus filed suit, alleging in pertinent part that Hubbartt breached 

his fiduciary duty to Backus Electric.1 Specifically, Backus claimed that Hubbartt 

planned or engaged in a competing business while still in Backus’s employ and 

thereafter utilized proprietary information gained through his employment to 

compete with Backus. 

¶7 Prior to trial, Backus named former accountant Stephen Bischel as 

an expert witness on the issue of damages. Hubbartt filed a pretrial motion 

seeking to preclude Bischel’s expert testimony. As grounds, Hubbartt asserted 

 

1

 Backus’s complaint alleged nine causes of action against Hubbartt and/or Lepich and 

Stauffer, the two employees that left Backus to work for Hubbartt. Specifically, the complaint 

alleged breach of fiduciary duty and duty of loyalty, aiding and abetting a breach of duties, breach 

of union contract, tortious interference with contractual relationships, unjust enrichment, 

misappropriation of trade secrets, violation of WIS. STAT. § 134.01 (injury to business), civil 

conspiracy, and a claim for punitive damages. 
No. 2019AP1651

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that Bischel’s method of calculating damages ran afoul of WIS. STAT. § 907.02 

(2019-20)2and Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 (1993), in 

that it was not based on reliable principles or methods. The circuit court denied 

the motion, stating: 

In his report Bischel is comparing normalized income for 

Backus Electric, Inc, for a period of time from June 30, 

2010 until June 30, 2013 against a period of time from 

June 30, 2014 until June 30th 2017. He is using the same 

methodology and factors in arriving at these figures during 

this time period. He is not saying that this data shows a 

loss in profits over this time. All it appears he is doing is 

pointing out the differences in income utilizing the same 

factors.

Now Bischel has a vast amount of experience in the CPA 

field and has testified in over 200 cases involving 

testimony about loss profits and loss of income and loss of 

earnings. Clearly with this experience as a CPA he can 

disseminate and calculate this information.

He can based on his accounting experience attest that this 

information is accurate.

Therefore under Wisconsin Statute Section 970.02 he may 

render the opinion contained in his report. He though can 

be cross examined about his data by the defense as to the 

weight of his opinion in determining damages.

Now this decision is premised on the fact that the plaintiff 

has not indicated to this Court that it’s going to have 

Mr. Bischel testify beyond what is contained in his report. 

If Mr. Bischel’s testimony were to venture into testifying 

that this is a proper measurement for accessing loss of 

profit damages the Court will have to take a closer look at 

this.

¶8 At trial, the jury heard from two competing accountants regarding 

the monetary damage to Backus from Hubbartt’s conduct. As stated previously, 

 

2

 All references to the Wisconsin Statutes are to the 2019-20 version unless otherwise 

noted.
No. 2019AP1651

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for Backus, the jury heard from Bischel, a semi-retired certified public accountant 

with over thirty years of experience valuing businesses, particularly businesses in 

the construction trade. Bischel had worked as an expert approximately 250 times

and testified in court about thirty times. Bischel testified that in order to calculate 

the amount of damages, he took the revenue from the four years prior to April 10, 

2013, and the four years after that date, and compared what the business could 

have sold for before versus after April 10, 2013, given the precipitous drop in high 

value clients that were lost to Hubbartt. Bischel calculated the difference to be 

$552,000. He explained his methodology and indicated that the method he used is 

the same method he uses when valuing businesses for non-litigation clients. 

Because the construction trade is a volatile one, he used a shorter four-year period 

of sales which necessarily drives the price of the business lower.

¶9 Barbara Bader testified as Hubbartt’s expert. She did not perform an 

analysis of the numbers but instead criticized Bischel’s methodology, which she 

called “diminished economic performance.” She testified that Bischel’s 

methodology is not a generally accepted method of calculating damages for a lossof-business case, and took Bischel to task for not analyzing other potential factors 

that might have contributed to Backus’s economic loss. 

¶10 The jury found Hubbartt liable to Backus Electric for breach of 

fiduciary duty, and awarded compensatory damages in the amount of $555,562. 

The jury also awarded $1,000,000 in punitive damages to Backus Electric.3

Hubbartt appeals.

 

3

 The jury did not find Hubbartt or the other defendants liable for any other causes of 

action. The circuit court dismissed Backus Electric’s remaining claim for unjust enrichment.
No. 2019AP1651

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The circuit court properly admitted Bischel’s expert testimony.

¶11 On appeal, Hubbartt maintains that Bischel’s testimony did not meet 

the reliability standard set forth in WIS. STAT. §907.02 and Daubert. Relying on 

the testimony and opinions of Bader, Hubbartt asserts that Bischel did not use an 

accepted method of calculating damages in a loss-of-business case, and that he 

should have but did not analyze other potential causes of Backus’s economic loss. 

¶12 The admissibility of expert testimony is governed by WIS. STAT.

§ 907.02(1), which provides: 

If scientific, technical, or other specialized knowledge will 

assist the trier of fact to understand the evidence or to 

determine a fact in issue, a witness qualified as an expert by 

knowledge, skill, experience, training, or education, may 

testify thereto in the form of an opinion or otherwise, if the 

testimony is based upon sufficient facts or data, the 

testimony is the product of reliable principles and methods, 

and the witness has applied the principles and methods 

reliably to the facts of the case.

¶13 This version of the statute was enacted to embody Daubert’s 

reliability standard. State v. Giese, 2014 WI App 92, ¶17, 356 Wis. 2d 796, 854 

N.W.2d 687. It assigns to the trial court a gate-keeping function “to ensure that 

the expert’s opinion is based on a reliable foundation and is relevant to the 

material issues.” Id., ¶18. A trial court’s decision to admit expert testimony is 

discretionary and will not be reversed if it has a rational basis and was made in 

accordance with the accepted legal standards and facts of record. Id., ¶16. 

¶14 We conclude that the circuit court properly exercised its discretion in 

admitting Bischel’s expert testimony. The circuit court properly focused on 

Bischel’s experience applying the income approach to valuing businesses both 

inside and outside of the courtroom. The data underlying Bischel’s opinion was 
No. 2019AP1651

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available to Hubbartt’s counsel for cross-examination, which made his opinions 

testable and not conclusory. His analysis was not esoteric; it relied on simple 

addition and subtraction. Bischel acknowledged the viability of a lost profits 

analysis, but explained why he considered his diminished economic performance 

analysis more appropriate on the facts of this case. Given this, the court properly 

exercised its discretion when it denied Hubbartt’s Daubert motion.

¶15 Citing the federal statute on expert testimony, Hubbartt maintains 

that Bischel’s diminished economic performance analysis should not have been 

placed before the jury. We need not look past the plain language in WIS. STAT.

§ 907.02(1), which is more instructive and was followed in this case. Here, 

Bischel used “other specialized knowledge” to “assist the trier of fact to 

understand the evidence or to determine a fact in issue,” based upon his 

“knowledge, skill, experience, training, or education,” and thus was permitted to 

testify “in the form of an opinion or otherwise” because the testimony was “based 

upon sufficient facts or data,” was “the product of reliable principles and 

methods,” and Bischel “applied the principles and methods reliably to the facts of 

the case.” Sec. 907.02(1). 

¶16 Contrary to the characterization in Hubbartt’s briefs, the circuit court 

did not abandon its gatekeeper function in admitting Bischel’s testimony. The 

court engaged in a well-reasoned and transparent analysis. It limited the scope of 

Bischel’s testimony, which also was subject to rigorous cross-examination by 

Hubbartt’s counsel and directly criticized by Bader. 

Ample evidence supports the jury’s finding that Hubbartt’s breach caused 

Backus’s loss.
No. 2019AP1651

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¶17 Hubbartt argues that Backus needed expert testimony to prove that 

his alleged breach caused damage to Backus, and that even if expert testimony was 

not required to establish causation, there was insufficient evidence at trial to 

support an inference that Hubbartt’s actions caused Backus’s loss. 

¶18 Whether Hubbartt’s breach caused Backus’s damage is a question of 

fact. Estate of Sheppard ex rel. McMorrow v. Specht, 2012 WI App 124, ¶5, 344 

Wis. 2d 696, 824 N.W.2d 907. We will “sustain a jury’s damage award as long as 

it is supported by credible evidence.” Tony Spychalla Farms, Inc. v. Hopkins 

Agr. Chem. Co., 151 Wis. 2d 431, 442, 444 N.W.2d 743 (Ct. App. 1989). To 

support a damage award, the evidence must demonstrate that a party was injured 

in some way and establish sufficient data from which the jury could probably 

estimate the amount of damages. Id.

¶19 First, we reject as unsupported Hubbartt’s assertion that Backus 

needed expert testimony to prove causation. Hubbartt provides no legal authority 

for and does not adequately develop this contention. See State v. Pettit, 171

Wis. 2d 627, 646-47, 492 N.W.2d 633 (Ct. App. 1992).

¶20 Second, there was ample evidence from which a jury could infer that 

Hubbartt’s breach caused Backus’s loss. Backus Electric is not a large business; a 

juror could easily infer from the facts of record that the precipitous decline in 

revenue was due to Hubbartt’s actions. 

¶21 Hubbartt argues that causation was not established because Bischel 

did not consider alternative explanations for Backus’s precipitous drop in income, 

such as customer dissatisfaction. From this, Hubbartt asserts that without 

testimony about alternative potential causes, the jury’s verdict was impermissibly 

speculative. 
No. 2019AP1651

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¶22 We are not persuaded. Through his own testimony along with the 

testimony of his codefendants and expert witness, Hubbartt provided the jury with 

alternative explanations for Backus’s lost business. Bader’s testimony criticized 

Bischel for failing to look at alternative explanations, and Bischel underwent 

extensive cross-examination. The jury’s verdict shows that it found Backus’s 

witnesses to be more credible than those presented by Hubbartt. We will not 

disturb the jury’s verdict, which is supported by the evidence of record. 

¶23 Hubbartt also argues that the circuit court erroneously excluded 

evidence of customer overbilling by Backus Electric. According to Hubbartt, such 

evidence might have rebutted Backus’s theory of causation by providing an 

alternative explanation for Backus’s lost business. 

¶24 We disagree. This court reviews the circuit court’s evidentiary 

rulings for an erroneous exercise of discretion. Here, the circuit court performed a 

thorough analysis under WIS. STAT. § 904.03, and explained its reasoning on the 

record. Though Hubbartt might disagree with the court’s ultimate decision, he has 

not pointed us to any misuse of discretion. 

The Jury’s award of punitive damages is warranted and not excessive.

¶25 A plaintiff may be awarded punitive damages “if evidence is 

submitted showing that the defendant acted maliciously toward the plaintiff or in 

an intentional disregard of the rights of the plaintiff.” WIS. STAT. § 895.043(3). 

The statute requires a plaintiff to prove that the defendant’s improper conduct: 

(1) was deliberate; (2) actually disregarded the rights of the plaintiff, “whether it 

be a right to safety, health or life, a property right, or some other right;” and 
No. 2019AP1651

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(3) was “sufficiently aggravated to warrant punishment by punitive damages.” 

Strenke v. Hogner, 2005 WI 25, ¶38, 279 Wis. 2d 52, 70, 694 N.W.2d 296. 

¶26 Hubbartt argues that the jury’s award of punitive damages was 

unwarranted because there was insufficient evidence that Hubbartt acted 

maliciously or with intentional disregard for Backus’s rights. We are not 

persuaded. 

¶27 Ample evidence in the record supports an inference that Hubbartt 

acted maliciously towards Backus or in intentional disregard of Backus’s rights.

Rather than purchasing Backus Electric, Hubbartt, while its vice president, began a 

scheme that involved setting up a competing enterprise, purchasing trucks for that 

competing enterprise, purchasing a location for that competing enterprise, and 

actually organizing that competing enterprise. Hubbartt went a step further and 

stole Backus’s computer programs to help with his competing enterprise. 

Hubbartt then coordinated with Backus’s two key employees to leave Backus at 

the same time and began poaching Backus’s best clients. 

¶28 Hubbartt also took steps to conceal his actions from Backus, and 

provided misleading information in discovery. For example, Hubbartt repeatedly 

denied taking any computer programs from Backus Electric, and stated under oath 

at a deposition that the personal computer he had while employed at Backus 

Electric was stolen. However, his personal computer was later discovered and 

analyzed by Backus’s forensic computer expert, who testified that he found close 

to 100 files transferred from Backus Electric. Most of these were transferred 

shortly before Hubbartt left Backus. Additionally, Backus’s computer expert 

testified that years into the litigation and after Hubbartt denied taking Backus’s 

computer files, Hubbartt searched his computer using the term “Backus”, deleted 
No. 2019AP1651

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all of the Backus-related folders, and ran file-wiping software to erase any 

remnants. 

¶29 Next, we reject Hubbartt’s argument that the punitive damages 

award of $1,000,000 was excessive. The award of punitive damages in a 

particular case is within the discretion of the jury and “we are reluctant to set aside 

an award merely because it was large or we would have awarded less.” Jacque v. 

Steenberg Homes, Inc., 209 Wis. 2d 605, 626, 563 N.W.2d 154 (Ct. App. 1997). 

An award is excessive, and therefore violates due process, if it is more than 

necessary to serve the purpose of punitive damages, or inflicts a penalty or burden 

on the defendant that is disproportionate to the wrongdoing. Management

Comput. Servs., Inc. v. Hawkins, Ash, Baptie & Co., 206 Wis. 2d 158, 193, 577 

N.W.2d 67, 81 (Ct. App. 1996). Punitive damages are meant to punish the 

wrongdoer, and to deter the wrongdoer and others from similar conduct, rather 

than to compensate the plaintiff for any loss. Trinity Evangelical Lutheran 

Church and Sch. – Freistadt v. Tower Ins. Co., 2003 WI 46, ¶50, 261 Wis. 2d 

333, 611 N.W.2d 789. In reviewing claims of excessive punitives, the evidence 

must be viewed in light most favorable to the plaintiff, and a jury’s punitive 

damages award will not be disturbed, unless the verdict is so clearly excessive as 

to indicate passion and prejudice. Id. at ¶56.

¶30 Wisconsin courts use a six-factor test to evaluate whether punitive 

damages are excessive such that they violate due process. Kimble v. Land 

Concepts, Inc., 2014 WI 21, ¶¶46-47, 353 Wis. 2d 377, 845 N.W.2d 395. Those 

factors are as follows:

1. The grievousness of the acts;

2. The degree of malicious intent; 
No. 2019AP1651

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3. Whether the award bears a reasonable relationship to the 

award of compensatory damages;

4. The potential damage that might have been caused by 

the acts;

5. The ratio of the award to civil or criminal penalties that 

could be imposed for comparable misconduct; and

6. The wealth of the wrongdoer.

Id. 

¶31 Hubbartt acknowledges that the punitive damages award was within 

the caps provided by WIS. STAT. § 895.043(6), but argues that it was unreasonable 

“because there was no testimony providing a causal nexus between Hubbartt’s 

actions and the amount of compensatory damages awarded” and because the 

award “is the product of [the alleged] errors argued above.” Indeed, Hubbartt’s 

analysis of all six factors relies on arguments that we have addressed and rejected, 

or that are legally undeveloped and unsupported. Viewing the verdict in the light 

most favorable to Backus, we cannot say that the award was so clearly excessive 

as to indicate impermissible passion or prejudice. 

Hubbartt is not entitled to a new trial in the interest of justice because the real 

controversy was fully and fairly tried.

¶32 Finally, Hubbartt seeks a new trial under WIS. STAT. § 752.35 on the 

grounds that the real controversy was not fully tried. To succeed, he must 

demonstrate “that the jury was precluded from considering ‘important testimony 

that bore on an important issue’ or that certain evidence which was improperly 

received ‘clouded a crucial issue’ in the case.” State v. Darcy N.K., 218 Wis. 2d 

640, 667, 581 N.W.2d 567 (Ct. App. 1998) (quoting State v. Hicks, 202 Wis. 2d 

150, 160, 549 N.W.2d 435 (1996)). An appellate court will exercise its discretion 
No. 2019AP1651

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to grant a new trial in the interest of justice “only in exceptional cases.” State v. 

Cuyler, 110 Wis. 2d 133, 141, 327 N.W.2d 662 (1983). 

¶33 Hubbartt argues that the accumulation of errors in this case entitles 

him to a new trial. To the claims we have already addressed, Hubbartt adds that 

the circuit court sua sponte restricted witness testimony and disciplined Hubbartt’s 

witnesses, or otherwise improperly curtailed his case. Again, we are not 

persuaded.

¶34 First, Hubbartt points out that Backus’s case spanned four of five 

trial days, and suggests that Hubbartt’s counsel was strong-armed into entering 

stipulations in lieu of presenting live witnesses. This is contradicted by the record, 

which demonstrates that the streamlining or stipulations of witnesses was 

accomplished with the consent of Hubbartt’s counsel. 

¶35 Second, Hubbartt complains that the circuit court prevented him 

from introducing the testimony of a former Backus Electric customer, and 

improperly restricted the testimony of defense witnesses Barbara Bader and 

Nicholas Reimann. With regard to the former Backus customer who was 

allegedly overbilled, there was no evidence that the customer even knew of the 

claimed overbilling. As such, this testimony was not relevant to explain why the 

customer left Backus for Hubbartt.

¶36 As for the alleged restrictions on Hubbartt’s witnesses, the circuit 

court thoroughly explained each of its evidentiary rulings. In terms of 

admonishments, the court gave ample warning before admonishing two defense 

witnesses in front of the jury. Despite the court’s warnings, Bader and Reimann 

repeatedly refused to follow the court’s instructions. Hubbartt develops no 

coherent legal theory as to how this constitutes an erroneous exercise of discretion. 
No. 2019AP1651

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By the Court.—Judgment affirmed.

This opinion will not be published. See WIS. STAT.

RULE 809.23(1)(b)5.