Wisconsin in-house counsel reinstated: Law trumps client's counsel of choice.

• Author: Ziemer, David

Byline: David Ziemer

Clients' right to counsel of their choice does not trump employment discrimination laws, or the laws' prescribed remedies.

Thus, awkward as it may be, an in-house attorney found to have been discriminated and retaliated against, can be reinstated as the corporation's legal counsel against the client's wishes.

Writing for the Wisconsin Court of Appeals on April 14, Judge Edward R. Brunner wrote, Menard fails to explain how Wisconsin law regarding clients' rights to choose their attorneys, or the rules of professional conduct, could negate the remedies of wrongfully terminated employees under federal law.

Dawn M. Sands was employed as vice president and executive general counsel for Menard Inc. Sands complained that Menard paid her less than a similarly situated male employee.

After she was terminated, she claimed that Menard violated the Equal Pay Act, Title VII of the Civil Rights Act of 1964, and the Wisconsin Fair Employment Act.

An arbitration panel agreed, and awarded compensatory and punitive damages. In addition, the panel ordered reinstatement, although neither party sought that remedy.

The arbitrators acknowledged that it could award front pay in lieu of reinstatement, but concluded that not to reinstate Sands would reward the company for its mistreatment of her.

Menard refused to reinstate Sands and moved to vacate the award. However, Eau Claire County Circuit Court Judge Paul J. Lenz affirmed, as did the Court of Appeals.

Manifest Disregard

The court first held that it may still consider manifest disregard of the law as a basis for vacating an arbitration award.

Sands argued it was no longer a proper basis, relying on the U.S. Supreme Court opinion holding in Hall Street Associates, LLC, v. Mattel, Inc., 128 S.Ct. 1396 (2008).

(http://www.supremecourtus.gov/opinions/07pdf/06-989.pdf) However, the court found that Hall Street only applies to judicial review under the Federal Arbitration Act. The court also found that the Wisconsin Supreme Court has reaffirmed that manifest disregard of the law remains a basis for vacating an arbitration award, in Racine County v. Int'l. Ass'n. of Mach. & Aerosp. Workers, 2008 WI 70, 310 Wis.2d 508, 751 N.W.2d 312.

Reinstatement

Turning to the merits, the court held that the arbitrators did not manifestly disregard the law allowing clients to choose their attorneys, by ordering reinstatement.

First, the court noted that neither the Equal Pay Act nor Title VII contains an...