The Wisconsin Court of Appeals held that documents exchanged in mediation are privileged, and thus not discoverable, even if those documents were exchanged prior to the enactment of the statute creating the mediation privilege.

In Dyer v. Blackhawk Leather LLC, No. 2007AP1400, 2008 WL 2906965 (Wis. Ct. App. July 30, 2008), Dyer sued Waste Management for contamination of his groundwater, and Dyer also sued a group of businesses (the Generators) for contributing to the contamination.

Prior to Dyer’s suit, Waste Management and the Generators had reached a mediated agreement that allocated the cleanup costs between them. Dyer sought discovery of documents generated during that mediation process, but the trial court held that the documents were subject to both state and federal mediation privileges. Dyer appealed.

On appeal, Dyer argued that because Wisconsin’s mediation privilege statute (Wis. Stat. § 904.085) was not enacted until after the mediation between Waste Management and the Generators had taken place, it was inapplicable to the documents generated by the mediation. The Court rejected Dyer’s argument, holding that the statute does not allow present-day discovery of mediation communication regardless of when such communication occurred.

Dyer also argued that applying the privilege in this case would not fulfill the purpose of the statute, which is to "encourage the candor and cooperation of disputing parties" in order to reach settlement. The Court agreed, but nevertheless held that applying the privilege would not undermine that purpose either. Thus, since there was no language in the statute limiting its application to mediations occurring after the date of its adoption, the Court held that the statute applied and the communications were privileged.

Finally, Dyer argued that the documents were discoverable under the exception set forth in § 904.085(e), which allows a court to admit evidence otherwise privileged if necessary to prevent a manifest injustice. The Court rejected this argument as well, holding that it was within the trial court’s discretion to determine the issue.