Court Opinion

ID: 9690864
Source: CourtListenerOpinion
Date Created: 2023-08-24 19:49:21.751933+00
Date Added: 2024-06-11T09:08:10.730993
License: Public Domain

ANN WALSH BRADLEY, J.
¶ 47. (dissenting). I agree with the majority that our jurisprudence regarding exculpatory clauses remains as vibrant as ever. See majority op., ¶ 35. Such clauses have been, are, and will continue to be looked upon with disfavor.1
¶ 48. I also agree with the majority that Discount Fabric House of Racine, Inc. v. Wisconsin Telephone Co., 117 Wis. 2d 587, 345 N.W.2d 417 (1984), is still good law. See majority op., ¶¶ 3, 45.1 part ways with the majority, however, in its application of that law to the record in this case. The majority obfuscates the focus of the summary judgment inquiry by engaging in generalizations as to time and location rather than focusing on the specific times and locations relevant here.
¶ 49. As the majority recognizes, it is clear that "Wisconsin case law does not favor exculpatory agreements." Majority op., ¶ 35. "Indeed," says the majority, "each exculpatory contract that this court has looked at in the past 25 years has been held unenforceable." Id. *198(citing Alexander T. Pendleton, Enforceable Exculpatory Agreements: Do They Still Exist?, 78 Wis. Lawyer 16, (August 2005)).2
¶ 50. Just last term this court reaffirmed its restrictive approach to exculpatory agreements in Atkins v. Swimwest Family Fitness Center, 2005 WI 4, 277 Wis. 2d 303, 691 N.W.2d 334:
Wisconsin case law does not favor such agreements. While this court has not held that an exculpatory clause is invalid per se, we have held that such a provision must be construed strictly against the party seeking to rely on it.
Atkins, 277 Wis. 2d 303, ¶ 12 (citations omitted).
¶ 51. Time and time again, this court has held exculpatory agreements unenforceable and has stated the rule that such agreements are disfavored. On this, the majority and I agree.
¶ 52. I also agree with the majority that Discount Fabric remains good law. See majority op., ¶¶ 3, 45. One of the key principles of Discount Fabric is that a contract is unconscionable if there is an absence of meaningful choice for one party together with contract terms that are unreasonably favorable to the other party. This principle is well-settled3 and infuses the *199majority's analysis, even as it characterizes the agreement here as a stipulated damages clause. See majority op., ¶¶ 39-43; see also majority op., ¶¶ 27, 33.
¶ 53. Where I disagree with the majority is in its application of Discount Fabric in light of the record in this case, decided on summary judgment. Although the majority recites summary judgment standards, it does not properly apply them. If it did, it could not reach the result that it does under Discount Fabric. Allow me to demonstrate.
¶ 54. In Discount Fabric, the court recognized that the yellow pages aspect of the phone company's dealings was "not legally monopolistic." Discount Fabric, 117 Wis. 2d at 594. The court invalidated the exculpatory clause in Discount Fabric (1) because of the phone company's "decisive advantage of bargaining strength" and (2) because there was no significant competition. Id. at 594, 596, 604. Acknowledging the existence of other yellow pages publishers in the relevant area, the court concluded that there was no "other mode of advertising... which reaches as many customers, is of a similar nature as the yellow pages, and is inexorably tied to the telephone service." Id. at 591, 594.
¶ 55. The question is not, as the majority would have it, simply whether the telecommunications industry has generally opened to competition since the time of Discount Fabric in 1984. Of course it has.
¶ 56. Rather, the question the majority should be asking is whether the yellow pages advertising market was any different in 1999 in Oconomowoc and Wauke-*200sha and in 2000 in Watertown than the market addressed in Discount Fabric. The answer is unclear. It is precisely this uncertainty that renders this case unsuitable for summary judgment disposition.
¶ 57. The majority shifts the focus of the summary judgment inquiry. The relevant time is 1999-2000. The relevant locations are Oconomowoc, Waukesha, and Watertown. The majority obfuscates this by engaging in generalizations, apparently relying on data for 2002 and data for Milwaukee. See majority op., ¶¶ 9, 23.
¶ 58. Rainbow's summary judgment materials include an affidavit by Frank Paoletti, the API employee who negotiated with Rainbow. He averred that during the time period of September 1997 to September 2000, he was aware of "no other book that had the depth of distribution and penetration comparable to that of Ameritech's Yellow pages" and that API had "no real competitors in the advertisement/yellow page market." An attachment to his affidavit showed that in Oconomowoc in 1999-2000, 99.3 percent of households had a telephone.
¶ 59. In API's sparse summary judgment materials, one of its regional marketing managers averred that consumers in the Waukesha area consulted Ameritech's competitors 9 percent of the time in 1998 and 41 percent of the time in 2002. The regional manager's affidavit gives no such statistics for Ocono-mowoc or Watertown for any year. Rather, it makes general factual assertions. For example, the regional manager avers that there has been increasing competition "since the late 1990's" and that there has been one "serious competitor" for "several years" in "Milwaukee and the rest of southeastern Wisconsin."
*201¶ 60. Unlike the majority, I view these materials in a light most favorable to Rainbow, as summary judgment methodology requires. In doing so, I conclude that the materials demonstrate a genuine issue of material fact as to whether, at the relevant time in the relevant markets, API had any more than negligible competition as contemplated in Discount Fabric. Here, on this record, it remains disputed whether there was any "other mode of advertising. . . which reaches as many customers, is of a similar nature as the yellow pages, and is inexorably tied to the telephone service." Discount Fabric, 117 Wis. 2d at 594.
¶ 61. An opportunity to bargain is another, related material fact under Discount Fabric. The parties in Discount Fabric stipulated as follows:
that all yellow pages advertising in Wisconsin for the year in question utilized the same form contract. Furthermore, none of the telephone company's employees or agents had the authority to alter any of the terms or provisions of the standard contract, nor had they ever done so. The parties also stipulated that there was never any bargaining on either price or terms with any advertiser; each subscriber in the Racine directory paid exactly the same for the same size listing or advertisement.
Id. at 589-90.
¶ 62. The majority says these are "important stipulations." Majority op., ¶ 17. I agree that they are important, and they underscore the existence of genuine issues of material fact here.
¶ 63. Turning again to API's sparse summary judgment materials, API offers no affirmative evidence of Rainbow's opportunity to bargain, other than the language of the contract itself. In contrast, Rainbow's responsive materials include an averment by Paoletti *202that as a representative of API he was not authorized to change the terms of the form contract.
¶ 64. Moreover, the contract itself is internally inconsistent as to the opportunity to bargain. It states that the customer may negotiate different terms including higher liability limits, as the majority emphasizes. However, it also contains the following provisions:
IN ORDER TO MAINTAIN OUR PRICING SCHEDULES, WE CANNOT AND DO NOT ACCEPT LIABILITY FOR LOST PROFITS OR FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF ERRORS OR OMISSIONS. ...
UNDER NO CIRCUMSTANCES (1) WILL OUR LIABILITY FOR ANY ADVERTISING UNIT EXCEED THE AMOUNT YOU HAVE ACTUALLY PAID FOR IT TOGETHER WITH FUTURE PAGESPLUS ADVERTISING CREDIT OF LIKE AMOUNT ....
¶ 65. Again, and unlike the majority, I follow summary judgment methodology and construe the parties' summary judgment materials in the light most favorable to Rainbow, not in a light most favorable to API. In doing so, I conclude that the internal inconsistency of the contract and Paoletti's affidavit raise an issue of material fact as to whether Rainbow had any real opportunity to bargain. At a minimum, they raise a reasonable inference that the opportunity to bargain stated in the contract is illusory.
¶ 66. In short, the parties' summary judgment materials raise genuine issues of material fact under Discount Fabric. It remains disputed whether, in the relevant markets at the relevant time, API's yellow pages business, even if "not legally monopolistic," left *203Rainbow with no "other mode of advertising .. . which reaches as many customers, is of a similar nature as the yellow pages, and is inexorably tied to the telephone service." Discount Fabric, 117 Wis. 2d at 594. It remains disputed whether, in the relevant markets at the relevant time, API had a "decisive advantage of bargaining strength." Id. at 596. It remains disputed whether Rainbow had any real opportunity to bargain. Thus, I would reverse the circuit court's grant of summary judgment.
¶ 67. In sum, although I agree with the majority that our jurisprudence regarding exculpatory clauses remains as vibrant as ever and that Discount Fabric remains good law, I disagree with the majority's application of the law here. Accordingly, I respectfully dissent.

 See, e.g., Atkins v. Swimwest Family Fitness Ctr., 2005 WI 4, ¶ 12, 277 Wis. 2d 303, 691 N.W.2d 334; Merten v. Nathan, 108 Wis. 2d 205, 210-11, 321 N.W.2d 173 (1982).

 The cases to which the article refers are Atkins, 277 Wis. 2d 303; Yauger v. Skiing Enterprises, Inc., 206 Wis. 2d 76, 557 N.W.2d 60 (1996); Richards v. Richards, 181 Wis. 2d 1007, 513 N.W2d 118 (1994); Dobratz v. Thomson, 161 Wis. 2d 502, 468 N.W.2d 654 (1991); Arnold v. Shawano County Agric. Soc'y, 111 Wis. 2d 203, 330 N.W.2d 773 (1983); and Merten, 108 Wis. 2d 205.

 See Deminsky v. Arlington Plastics Mach., 2003 WI 15, ¶ 27, 259 Wis. 2d 587, 657 N.W.2d 411; Discount Fabric House of Racine, Inc. v. Wisconsin Tel. Co., 117 Wis. 2d 587, 601, 345 *199N.W.2d 417 (1984); First Fed. Fin. Serv., Inc. v. Derrington's Chevron, Inc., 230 Wis. 2d 553, 558, 602 N.W.2d 144 (Ct. App. 1999); Leasefirst v. Hartford Rexall Drugs, Inc., 168 Wis. 2d 83, 89, 483 N.W.2d 585 (Ct. App. 1992)