State v. Engine & Transmission World, LLC

2023 WI App 42

COURT OF APPEALS OF WISCONSIN
PUBLISHED OPINION

Case No.: 2022AP788

† Petition for Review Filed

Complete Title of Case:

STATE OF WISCONSIN,

PLAINTIFF-APPELLANT-CROSS-RESPONDENT,

V.

ALFRED TALYANSKY, SW TRANSMISSIONS MANAGER, LLC,
REMANNS, LLC, REMANNS MANAGER, LLC, QUALITY USED ENGINES,
LLC, ENGINE RECYCLER MANAGER, LLC, QUALITY USED
TRANSMISSIONS, LLC, QUALITY USED TRANSMISSIONS MANAGER,
LLC, QUALITY USED ENGINES MANAGER, LLC, MIDWEST AUTO
RECYCLING, LLC, ENGINE SHOPPER, LLC, ENGINE SHOPPER
MANAGER, LLC, ENGINE & TRANSMISSION WORLD, LLC, BELDEN
MFG, LLC, APLS ACQUISITION, LLC, ENGINE RECYCLER, LLC, SW
ENGINES MANAGER, LLC, SW ENGINES, LLC, SW TRANSMISSIONS,
LLC, U NEED ENGINES MANAGER, LLC, AND U NEED ENGINES, LLC,

DEFENDANTS-RESPONDENTS-CROSS-APPELLANTS.†

Opinion Filed: July 25, 2023
Submitted on Briefs: March 17, 2023
Oral Argument:

JUDGES: Brash, C.J., Donald, P.J., and White, J.
Concurred:
Dissented:

Appellant
ATTORNEYS: On behalf of the plaintiff-appellant-cross-respondent, the cause was
submitted on the brief of Brian P. Keenan and Clayton P. Kawski,
assistant attorneys general, and Joshua L. Kaul, attorney general.

Respondent
ATTORNEYS: On behalf of the defendants-respondents-cross-appellants, the cause
was submitted on the brief of Douglas W. Rose, Jennifer Geller
Baumann, and Kaitlynn E. Ebben of Rose & deJong, S.C. of
Milwaukee.

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2023 WI App 42

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
July 25, 2023
A party may file with the Supreme Court a
Samuel A. Christensen petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10 and
RULE 809.62.

Appeal No. 2022AP788 Cir. Ct. No. 2017CX4

STATE OF WISCONSIN IN COURT OF APPEALS

STATE OF WISCONSIN,

PLAINTIFF-APPELLANT-CROSS-RESPONDENT,

V.

ALFRED TALYANSKY, SW TRANSMISSIONS MANAGER, LLC, REMANNS,
LLC, REMANNS MANAGER, LLC, QUALITY USED ENGINES, LLC,
ENGINE RECYCLER MANAGER, LLC, QUALITY USED TRANSMISSIONS,
LLC, QUALITY USED TRANSMISSIONS MANAGER, LLC, QUALITY USED
ENGINES MANAGER, LLC, MIDWEST AUTO RECYCLING, LLC, ENGINE
SHOPPER, LLC, ENGINE SHOPPER MANAGER, LLC, ENGINE &
TRANSMISSION WORLD, LLC, BELDEN MFG, LLC, APLS
ACQUISITION, LLC, ENGINE RECYCLER, LLC, SW ENGINES
MANAGER, LLC, SW ENGINES, LLC, SW TRANSMISSIONS, LLC, U
NEED ENGINES MANAGER, LLC, AND U NEED ENGINES, LLC,

DEFENDANTS-RESPONDENTS-CROSS-APPELLANTS.
No. 2022AP788

APPEAL and CROSS-APPEAL from an order of the circuit court for
Milwaukee County: WILLIAM SOSNAY, Judge. Reversed and cause remanded
with directions; cross-appeal dismissed.

Before Brash, C.J., Donald, P.J., and White, J.

¶1 DONALD, P.J. This appeal and cross-appeal involve a consumer
protection action filed under the Deceptive Trade Practices Act, WIS. STAT.
§ 100.18 (2021-22),1 against multiple defendants, here the Defendants-
Respondents-Cross-Appellants, who we collectively refer to as “Midwest.”

¶2 On appeal, the State contends that the circuit court improperly
determined that WIS. STAT. § 100.18(1) does not apply to misrepresentations made
by a Wisconsin business to a consumer out-of-state, and that the State needed to
establish that someone suffered a pecuniary loss in order to prove a violation of
§ 100.18(1) and (10r). In its combined response and cross-appeal, Midwest
disagrees with the State, and additionally contends that the circuit court erred in
failing to award costs to Midwest.

¶3 As discussed below, we agree with the State that the circuit court
improperly found that WIS. STAT. § 100.18(1) only applies to misrepresentations
made to in-state consumers, and that the State needed to prove that someone
suffered a pecuniary loss. Accordingly, we reverse and remand for a new trial.
Further, because we are reversing and remanding for a new trial, we hold that
Midwest’s request for costs is moot, and therefore the cross-appeal is dismissed.

1
The representations at issue in this case took place between June 24, 2014, to December
1, 2021. However, because the relevant statutory language has not changed, all references to the
Wisconsin Statutes are to the 2021-22 version unless otherwise noted.

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No. 2022AP788

BACKGROUND

¶4 In the nineties, Alfred Talyansky’s family founded Mid City Auto
Salvage, the predecessor company to Midwest. Mid City Auto Salvage, operated a
salvage yard in the City of Milwaukee. Initially, Mid City obtained its inventory
from vehicle auctions. The vehicle parts would then be sold out of the Milwaukee
location.

¶5 In 2006, Mid City was dissolved and Midwest Auto Recycling was
created and opened a new physical location in Cudahy, Wisconsin. Due to the
internet boom, Midwest Auto Recycling opted to focus on online sales of specific
auto parts, including engines, transmissions, axles, transfer cases, and
superchargers. To expand the business, Midwest Auto Recycling created various
websites and companies—the other listed respondents in this case—to advertise and
sell the auto parts to people and businesses throughout the United States.

¶6 Beginning in 2015, the State received hundreds of complaints
regarding Midwest. The complaints ranged from misrepresentations about the
mileage of parts to the quality of the parts sold.

¶7 On June 23, 2017, the State filed a complaint, alleging that Midwest
committed the following violations: (1) fraudulent misrepresentations under WIS.
STAT. § 100.18(1) in marketing and selling; (2) fraudulent misrepresentations under
§ 100.18(10r) regarding where their business was located; and (3) unfair billing
practices under WIS. STAT. § 100.195(2)(a).2

2
On February 12, 2018, the State filed an amended summons and complaint, which
included the same causes of action.

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No. 2022AP788

¶8 On June 30, 2018, the State filed a witness disclosure which contained
the names of 477 consumers alleged to have purchased a used engine or
transmission from Midwest, six of whom were located in Wisconsin. Subsequently,
on July 24, 2018, the State filed a motion for a temporary injunction, which the
circuit court denied.

¶9 On July 27, 2018, Midwest filed a motion seeking partial summary
judgment on the claims related to persons outside of Wisconsin. Alternatively, the
motion requested that the circuit court issue an order defining the scope of the
State’s claims and limiting the claims to those based on representations to persons
within Wisconsin.

¶10 On September 13, 2018, the circuit court denied Midwest’s motion
for partial summary judgment because there were “underlying facts that [were]
unknown, uncertain, and likely disputed.” In its decision, the court stated that WIS.
STAT. § 100.18 did not require that “the conduct, statements, or consumers must be
in Wisconsin[.]” The court stated that “there is no clear line, such as Wisconsin’s
border, at which the [c]ourt can conclude that the State may no longer take action[.]”
Additionally, the court denied Midwest’s motion to define the scope of the State’s
claim as “the State indicates that it intends to enforce the statute for consumers
inside and outside of Wisconsin.”

¶11 In October 2018, Midwest sought an interlocutory appeal, which this
court denied on April 9, 2019.

¶12 On November 5, 2018, the State filed an amended witness disclosure
list that reduced the number of witnesses to forty-two consumer witnesses with two
witnesses from Wisconsin. Subsequently, the State filed a pretrial report, which
further narrowed the list and stated that the State “intend[ed] to present the

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No. 2022AP788

testimony of 20 consumer witnesses to the jury,” and sixteen would be held “in
reserve.”

¶13 On March 1, 2021, Midwest filed a motion to reconsider the denial of
its motion for partial summary judgment.3 The motion argued that since the 2018
circuit court decision, a federal decision—T&M Farms v. CNH Indus. Am., LLC,
488 F. Supp. 3d 756 (E.D. Wis. 2020)—had determined that WIS. STAT. § 100.18(1)
does not apply to consumers outside of Wisconsin. On April 19, 2021, the circuit
court heard Midwest’s motion for reconsideration, and granted it.

¶14 On October 6, 2021, Midwest filed a memorandum of remaining trial
issues, as a new judge was assigned to the case due to a judicial rotation.4 In
particular, Midwest sought to exclude: any out-of-state witness testimony; an expert
witness report from Jocelyn Henning, a State of Wisconsin employee; and testimony
from Tony Mooneyham, a third-party marketing person who did online marketing
and website work for Midwest.

¶15 The State filed its own memorandum, along with an offer of proof
regarding seven of its trial witnesses. The State argued that it should be permitted
to introduce evidence showing Midwest’s general business practices.

¶16 First, the State asserted that Henning would summarize data from the
discovery records to compare the mileage in the quotes provided to potential
consumers with the actual mileage of parts delivered to the consumers. According
to the State, Henning’s testimony would show that Midwest systematically

3
The trial was delayed due to the COVID-19 pandemic.
4
The case was transferred from the Honorable William S. Pocan to the Honorable William
Sosnay, who presided over the remainder of the proceedings.

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No. 2022AP788

misrepresented the mileage of the parts they sold. In addition to Henning, relatedly,
the State sought to introduce the testimony of two employees of one of Midwest’s
suppliers, primarily to authenticate the records and provide information about
Midwest’s business practices.

¶17 Second, the State sought to introduce the testimony of three out-of-
state consumers. The State indicated that the consumer witnesses would testify
regarding how the engines they received did not match up with the representations
that had been made.

¶18 Lastly, the State explained that Mooneyham’s testimony would
include why Midwest had websites with different names, how Midwest measured
the performance of their websites, and how Talyansky controlled the content of the
websites.

¶19 On November 8, 2021, in an oral ruling, the circuit court ruled that
evidence regarding “incidents that occurred outside Wisconsin, meaning dealing
with residents of other states, is not admissible.” The court stated that under WIS.
STAT. § 904.03, the evidence and testimony in the State’s offer of proof would be
“unfairly and unduly prejudicial[.]”

¶20 A jury trial commenced on November 29, 2021. The State called
Talyansky, two witnesses who were employed by Talyansky and Midwest, and
Joseph Koehler. Midwest called a shop manager to testify and also recalled
Talyansky.

¶21 In particular, Koehler, from Westfield, Wisconsin, testified that he
purchased a used transmission with a supposed mileage of 78,176 from the Quality
Used Transmissions website. Koehler believed that the transmission was in Quality

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No. 2022AP788

Used Transmissions’ inventory. According to the sales quote, the transmission was
tested, visually inspected, and cleaned. Shortly after the transmission was installed
in his family vehicle, Koehler needed to have the transmission replaced as a dealer
told him that the vehicle should not be driven. Quality Used Transmissions
provided a second used transmission, but it refused to cover the labor installation
cost for the second replacement transmission, rejecting Koehler’s proof regarding
the odometer reading.

¶22 After the completion of testimony, the parties and the circuit court
discussed the jury instructions outside the presence of the jurors. Relevant to this
appeal, the court stated that it would provide the standard jury instruction WIS JI-
CIVIL 2418 on unfair trade practices. The court indicated that the parties had
submitted a modification of the jury instruction, which left out the third element—
that the plaintiff sustained a monetary loss as a result of the representation. The
court stated that to exclude the third element “would be a mistake.” The court
explained that it is “fundamental that [the State] would have to show that there has
been some loss as a result of what they claim was false advertising,” or “the statute
itself would really stand for nothing.” The State objected, arguing that “only the
first two elements were required to be proved to establish a violation of the statute.”
The circuit court rejected the State’s argument. Consistent with the court’s ruling,
a question was added to the special verdict form that asked the jury to find whether
any Wisconsin consumer sustained a monetary loss.

¶23 The jury first found Midwest’s advertisements to Wisconsin
consumers were not untrue, deceptive, or misleading. Second, the jury found that
four of Midwest’s websites published a misrepresentation that the business behind
the website was in a certain community or region when it was not. Third, the jury
found that representations in sales quotes from June 14, 2014, to the time of trial,

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No. 2022AP788

were not untrue, deceptive, or misleading in regards to the mileage of the used auto
part offered for sale, and whether the auto part was compression tested. Fourth, the
jury found that Talyansky had knowledge of, and the ability to control the
representations in the first two findings. Lastly, the jury found that the State had
failed to prove a Wisconsin consumer had suffered a monetary loss due to a
misrepresentation.

¶24 Both parties filed motions for judgment on the verdict and costs. In
its motion for judgment, the State sought a permanent injunction to prevent Midwest
from misrepresenting the location of their businesses, and a civil forfeiture for
Midwest’s alleged violation of WIS. STAT. § 100.18(10r). The circuit court granted
a judgment on the verdict for Midwest, declined to order costs to either party, and
dismissed the case.

DISCUSSION

¶25 On appeal, the State contends that the circuit court committed two
errors of law justifying a new trial. First, the State contends that the circuit court
improperly determined that WIS. STAT. § 100.18(1) does not apply to
misrepresentations made by a Wisconsin business to a consumer outside Wisconsin.
Second, the State contends that the circuit court improperly found that the State
needed to prove that someone suffered a pecuniary loss in order to prove a violation
of § 100.18(1) and (10r).

¶26 In its combined response and cross-appeal, Midwest contends that
WIS. STAT. § 100.18(1) provides a cause of action only for advertising received
within Wisconsin, and the State was required to prove a pecuniary loss. In addition,
Midwest argues that the circuit court erred by failing to award costs against the
State.

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No. 2022AP788

¶27 Below, we first address the plain language of WIS. STAT. § 100.18(1).
We then examine whether the State was required to prove that there was a pecuniary
loss. Finally, we turn to Midwest’s request for costs.

I. Plain Language of WIS. STAT. § 100.18(1)

¶28 When interpreting a statute, we begin our analysis by looking at the
language of the statute. State ex rel. Kalal v. Circuit Ct. for Dane Cnty., 2004 WI
58, ¶45, 271 Wis. 2d 633, 681 N.W.2d 110. If the meaning of the words of a statute
are plain, we stop our inquiry and apply the words chosen by the legislature. Id.
“Statutory language is given its common, ordinary, and accepted meaning, except
that technical or specially-defined words or phrases are given their technical or
special definitional meaning.” Id. Statutory interpretation presents a question of
law that is reviewed de novo. DOR v. River City Refuse Removal, Inc., 2007 WI
27, ¶26, 299 Wis. 2d 561, 729 N.W.2d 396.

¶29 WISCONSIN STAT. § 100.18(1), the statute at issue here, provides in
pertinent part that:

No person, firm, corporation or association, or agent or
employee thereof ... shall make, publish, disseminate,
circulate, or place before the public, or cause, directly or
indirectly, to be made, published, disseminated, circulated,
or placed before the public, in this state ... an advertisement,
announcement, statement or representation of any kind to the
public ... which advertisement, announcement, statement or
representation contains any assertion, representation or
statement of fact which is untrue, deceptive or misleading.

¶30 The plain language of the statute prohibits anyone from “mak[ing],”
“publish[ing],” or “caus[ing] … to be made … in this state” an advertisement or
other representation that contains an “untrue, deceptive or misleading” assertion,
representation, or statement. Id. The verbs, which include “make,” “publish,” and

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No. 2022AP788

“cause,” focus on the advertiser’s conduct or actions, not the recipient or the
consumer. After a comma, the statute provides that these actions may not take place
“in this state.” The statute does not proscribe where the recipient or consumer must
be or reside. Thus, based on the plain language of the statute, we conclude that the
State can enforce WIS. STAT. § 100.18(1) against Wisconsin businesses that reach
consumers outside of the state. We will not add words to a statute that are not
present. See Dawson v. Town of Jackson, 2011 WI 77, ¶42, 336 Wis. 2d 318, 801
N.W.2d 316 (“We decline to read into the statute words the legislature did not see
fit to write.”).

¶31 Midwest argues that the phrase “in this state” means that “the
offending representation must be placed before the public in Wisconsin.” We
disagree. There is a comma that separates the phrase “before the public” and “in
this state.” If “in this state” modified “before the public,” then there would be no
need for a comma. See State ex rel. Ahlgrimm v. State Elections Bd., 82 Wis. 2d
585, 589-90, 263 N.W.2d 152 (1978) (concluding that the use of a comma
separating one phrase from another phrase meant that the latter phrase did not
modify the prior phrase).

¶32 Moreover, the legislature could have added language that limited a
violation of WIS. STAT. § 100.18(1) to a consumer based in Wisconsin, but chose
not to do so. For example, in a different section of Chapter 100, the consumer is
specifically identified as a resident of Wisconsin. See WIS. STAT. § 100.174(1)(a)1.-
2. (defining “buyer” as an individual who is a resident of this state and receives a
solicitation in Wisconsin). In contrast, § 100.18(1) does not identify or define the
recipient or consumer of the advertisement or representation at all.

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No. 2022AP788

¶33 In its decision granting Midwest’s motion for reconsideration, the
circuit court relied on T&M Farms, 488 F. Supp. 3d 756. In T&M Farms, two
cotton farms alleged that they purchased cotton pickers from CNH Industrial
America, LLC (CNH), a Wisconsin business. Id. at 758, 761. According to the
cotton farms, CNH misrepresented the quality and performance of their pickers and
failed to ensure that sufficient replacement parts would be available for needed
repairs. Id. at 759.

¶34 CNH moved to dismiss the claims, and the district court granted a
dismissal in relevant part because CNH did not make the allegedly deceptive
representations “in this state.” Id. at 760, 761. The district court explained that to
achieve WIS. STAT. § 100.18(1)’s statutory purpose of protecting Wisconsin
residents from deceptive advertising, the phrase “in this state” must be “referring to
the location of the advertising rather the advertiser.” Id. at 762 (emphasis omitted).
Contrast with Le v. Kohls Dept. Stores, Inc., 160 F. Supp. 3d 1096, 1115 (E.D. Wis.
2016) (holding that § 100.18(1) applies to a Wisconsin business even in cases where
the advertising is seen by a consumer in another state).

¶35 As the State observes, the district court’s interpretation in T&M
Farms skipped a plain language reading of the statute and focused instead on the
purpose of the statute. However, Wisconsin law requires courts to first examine the
plain language of the statute, and if the plain language of the statute is clear, we stop
the inquiry. See Kalal, 271 Wis. 2d 633, ¶45. We only go beyond the language of

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No. 2022AP788

the statute when the plain language is ambiguous.5 Thus, we do not find T&M
Farms persuasive.6

¶36 In addition, Midwest contends that applying WIS. STAT. § 100.18(1)
to advertisements received by consumers outside Wisconsin creates extraterritorial
and constitutional problems. To start, Midwest does not develop an argument
explaining how the State securing a forfeiture or an injunction against an in-state
business would involve an extraterritorial application. As discussed above, the plain
language of § 100.18(1) provides that the State can bring an action against in-state
businesses for making misrepresentations regardless of whether the
misrepresentations are received by out-of-state residents.

¶37 Moreover, there is no constitutional problem. The dormant commerce
clause “invalidates state statutes that ‘may adversely affect interstate commerce by
subjecting activities to inconsistent regulations.’” Morley-Murphy Co. v. Zenith
Elecs. Corp., 142 F.3d 373, 379 (7th Cir. 1998) (citations omitted). Midwest,
however, does not establish that there is inconsistent regulation. As the State
asserts, all Wisconsin businesses must do to comply with the law is refrain from
making misrepresentations in their advertising. If Midwest has to follow the law
5
We note that T&M Farms v. CNH Industrial America, LLC, 488 F. Supp. 3d 756, 762
(E.D. Wis. 2020) also relied on a 1928 Attorney General opinion, which addressed whether a
plaintiff could institute an action against a Chicago firm that made allegedly misleading statements
in Wisconsin publications. See 17 Op. Atty. Gen. 194 (1928). This one-page opinion, however,
did not interpret the relevant statutory language, which at that time was in WIS. STAT. § 343.413,
but instead advised that a plaintiff could institute an action against the firm if it obtained service on
an officer or agent of the firm in Wisconsin. Id.
6
Midwest also discusses Hydraulics International, Inc. v. Amalga Composites, Inc., No.
20-CV-371, 2022 WL 4273475, *10 (E.D. Wis. Sept. 2022), which determined that the application
of WIS. STAT. § 100.18(1) only applies to Wisconsin consumers. In reaching this conclusion, the
district court determined that the statutory language was unclear. Id., *8. We disagree. As
discussed above, we conclude that the language of the statute plainly allows the State to bring an
action against an in-state business regardless of whether the misrepresentations are received by out-
of-state residents. Thus, we do not find Hydraulics persuasive.

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No. 2022AP788

for in-state residents, there should be no issue following the law for out-of-state
residents given that both view the same websites.

¶38 Finally, Midwest contends that the State does not have standing to
bring an action. However, WIS. STAT. § 100.18(11)(a) provides that “[a]ctions to
enjoin violation of this section or any regulations thereunder may be commenced
and prosecuted by the department in the name of the state in any court having equity
jurisdiction.” Similarly, § 100.18(11)(d) states that the State may enforce against
“any violation of this section.” Thus, we reject Midwest’s argument that the State
does not have standing.

¶39 Therefore, the circuit court erred when it prohibited the State from
introducing evidence that Midwest made misrepresentations reaching consumers
outside Wisconsin. The plain language of WIS. STAT. § 100.18(1) does not require
that an advertisement or representation must be made to a Wisconsin resident.
Accordingly, we conclude that the State is entitled to a new trial.

II. Pecuniary Loss

¶40 Next, we address whether the State needed to prove a pecuniary loss
under WIS. STAT. § 100.18.

¶41 Midwest asserts that Wisconsin precedent—Novell v. Migliaccio,
2008 WI 44, ¶49, 309 Wis. 2d 132, 749 N.W.2d 544 and K & S Tool & Die Corp.
v. Perfection Machinery Sales, Inc., 2007 WI 70, ¶19, 301 Wis. 2d 109, 732
N.W.2d 792—establishes that the State must demonstrate a pecuniary loss. These
cases, however, address private party lawsuits brought under WIS. STAT.
§ 100.18(11)(b)2., which provides that “[a]ny person suffering pecuniary loss
because of a violation of this section by any other person may sue in any court of

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No. 2022AP788

competent jurisdiction and shall recover such pecuniary loss, together with costs,
including reasonable attorney fees[.]” See Novell, 309 Wis. 2d 132, ¶¶26-28; K & S
Tool, 301 Wis. 2d 109, ¶19. The State, however, did not invoke this section, and
instead brought this action under § 100.18(1) and (10r), which do not require the
State to prove a pecuniary loss.

¶42 Instead, we find State v. American TV & Appliance of Madison, Inc.,
146 Wis. 2d 292, 430 N.W.2d 709 (1988), instructive. In American TV, which
involved an action brought by the State against an appliance dealer, our supreme
court explicitly stated that there were two elements of the offense under WIS. STAT.
§ 100.18(1): (1) there must be an advertisement or announcement; and (2) the
advertisement or announcement must contain a statement which is “untrue,
deceptive, or misleading.” See American TV, 146 Wis. 2d at 295, 300. Thus, the
court did not require that the State prove a pecuniary loss to establish a violation
under § 100.18(1).7 As a result, we conclude that the circuit court erred when it
instructed the jury that the State had to prove that it “sustained a monetary loss as a
result of the assertion, representation or statement,” submitted a question to the jury
asking whether “any Wisconsin consumer sustain[ed] a monetary loss,” and denied
the State relief after the verdict.

¶43 Alternatively, Midwest contends that even if pecuniary loss is not an
element, any error was harmless. We disagree. Under WIS. STAT. § 805.18(1),
“[t]he court shall, in every stage of an action, disregard any error or defect in the
pleadings or proceedings which shall not affect the substantial rights of the adverse

7
We note that the circuit court distinguished State v. American TV & Appliance of
Madison Inc., 146 Wis. 2d 292, 430 N.W.2d 709 (1988), because it involved a motion to dismiss.
However, it is unclear why this would have mattered. The elements of a claim remain the same
regardless of the procedural posture of the case.

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No. 2022AP788

party.” For an error to affect the “substantial rights of a party,” there must be a
reasonable possibility that the error contributed to the outcome of the action or
proceeding at issue. See Nischke v. Farmers & Merchants Bank & Trust, 187
Wis. 2d 96, 108, 522 N.W.2d 542 (Ct. App. 1994). Here, the error was not harmless
because the jury found that Midwest misrepresented the location of four of their
businesses, and the circuit court denied the State any relief based on the circuit
court’s incorrect view that the State needed to prove a pecuniary loss.

¶44 Midwest argues that the error was harmless because the special jury
verdict separately asked whether a misrepresentation occurred and whether a
pecuniary loss resulted from that misrepresentation. In support, Midwest relies on
Rashke v. Koberstein, 220 Wis. 75, 264 N.W. 643 (1936), which found that “no
harm resulted to appellants for including in the verdict a question as to comparative
negligence which the jury were not to answer unless they first found the plaintiff
guilty of contributory negligence[.]” As the State observes, however, Rashke is
inapposite because it involved the issue of comparative and contributory negligence,
not whether the jury was improperly instructed regarding a pecuniary loss.

¶45 Midwest also argues that the State is not entitled to relief because it
did not introduce any consumer testimony that a location misrepresentation
occurred in Wisconsin under WIS. STAT. § 100.18(10r), and the circuit court
properly determined that granting a permanent injunction was not warranted.
Section 100.18(10r), however, is devoid of any language about “in this state.” In
addition, the circuit court’s denial of the State’s request for an injunction was based
on its incorrect belief that the State was required to prove a pecuniary loss. A circuit
court erroneously exercises its discretion if it makes an error of law. See LeMere v.
LeMere, 2003 WI 67, ¶14, 262 Wis. 2d 426, 663 N.W.2d 789. Accordingly, we

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No. 2022AP788

conclude the circuit court erred when it required the State to prove a pecuniary loss,
and we reverse and remand for a new trial.

III. Request for Costs

¶46 Lastly, we address Midwest’s request for costs against the State.
Midwest contends that the circuit court erred in failing to award costs against the
State. According to Midwest, the State is not immune from costs under WIS. STAT.
§§ 814.03 and 814.04, and any immunity that might exist was waived when the
State voluntarily commenced a lawsuit and requested relief on behalf of consumers
out-of-state.

¶47 The State responds that if this court reverses the circuit court’s
judgment, the issue of costs is moot. Alternatively, the State contends the circuit
court properly denied costs to Midwest. According to the State, WIS. STAT.
§§ 814.03 and 814.04 do not authorize costs against the State, and the State did not
waive sovereign immunity from costs by filing a circuit court action.

¶48 Given that we are reversing the circuit court’s judgment, and Midwest
is no longer a prevailing party, we agree with the State that this issue is moot. See
State ex rel. Olson v. Litscher, 2000 WI App 61, ¶3, 233 Wis. 2d 685, 608 N.W.2d
425 (“An issue is moot when its resolution will have no practical effect on the
underlying controversy.”). Therefore, we do not address it. Id.

CONCLUSION

¶49 In sum, for the reasons discussed above, we reverse and remand for a
new trial. Further, we conclude that Midwest’s request for costs is moot, and
therefore dismiss the cross-appeal.

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No. 2022AP788

By the Court.—Order reversed and cause remanded with directions;
cross-appeal dismissed.

17