Pro-Pac Incorporated v. WOW LogisticsCompany , 721 F.3d 781 ( 2013 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 12-2976
P RO -P AC, INC.,
Plaintiff-Appellant,
v.
WOW L OGISTICS C OMPANY,
Defendant-Appellee.
Appeal from the United States District Court
for the Eastern District of Wisconsin.
No. 11 CV 1075—J.P. Stadtmueller, Judge.
A RGUED JANUARY 24, 2013—D ECIDED JUNE 26, 2013
Before M ANION and W OOD, Circuit Judges, and B ARKER,
District Judge. Œ
P ER C URIAM. Pro-Pac, Inc. (Pro-Pac) was a packaging
business that filed for Chapter 11 bankruptcy in 2006. Pro-
Pac then filed an adversary proceeding against WOW
Logistics Co. (WOW), a logistics service provider, for
Œ
Hon. Sarah Evans Barker, of the Southern District of
Indiana, sitting by designation.
2 No. 12-2976
aiding and abetting a Pro-Pac employee’s breach of
fiduciary duty. The bankruptcy court found that WOW
had indeed aided and abetted the Pro-Pac employee, for
which tort the court attempted to calculate the damages.
But the bankruptcy court instead thought that its
award to Pro-Pac had to rest on an independent unjust-
enrichment claim. On appeal, the district court ordered
the bankruptcy court to dismiss the case because the
unjust-enrichment argument had been introduced too
late in the proceeding. Pro-Pac appeals from the district
court’s ruling, arguing that the district court erred in
dismissing the case and seeking reinstatement of the
bankruptcy court’s ruling. We agree that the district court
erred in dismissing the case, but the bankruptcy court also
erred in its approach to Pro-Pac’s damages. Thus, we
reverse the judgment of the district court with instruct-
ions to remand to the bankruptcy court. On remand, the
bankruptcy court should reexamine the issues relating
to a proper remedy for WOW’s tort liability.
I. Facts
Pro-Pac decided to expand into the warehouse and
transportation industry. To do so, Pro-Pac contacted
George Chapes, an experienced and well-connected
veteran of the warehouse industry, and hired him in
June 2005 to be its vice president of sales. Chapes re-
ceived a salary from Pro-Pac and a benefits package
that was worth significantly more than the packages
paid to other members of Pro-Pac’s sales team.
No. 12-2976 3
In August 2005, Pro-Pac subleased a warehouse in
East Troy, Wisconsin, from WOW, a logistics service
provider that brokers transportation services nation-
wide and operates public warehouses in Wisconsin,
Illinois, and Idaho. Pro-Pac met with WOW in April 2006
to consider another business deal, and WOW asked Pro-
Pac if it could use Chapes as a business consultant. Pro-Pac
expressed surprise in learning that WOW had been
talking to Chapes about being a consultant for WOW. Pro-
Pac told Chapes that “from this point forward . . . if you’re
working with WOW or there’s something going on, [Pro-
Pac] need[s] to know what’s happening. [WOW is] our
landlord. This is too close to home.”
Pro-Pac and WOW entered into negotiations that
would permit WOW to use Chapes as a consultant. These
negotiations began on July 17, 2006, when Pro-Pac sent
an email to WOW proposing that Chapes could work for
WOW in exchange for an extension of Pro-Pac’s lease
with WOW and a rebate of its rent for two months per
year for five years. Pro-Pac and WOW engaged in a
series of calls and emails in an attempt to work out the
details of an agreement. Ultimately, as the bankruptcy
court determined, WOW offered to give Pro-Pac free
rent for two months per year for five years in exchange
for Chapes’s services, provided that Chapes actually
secured a deal for WOW. On August 3, 2006, Pro-Pac
sent WOW an email “touching base” regarding the nego-
tiations, and on August 8, 2006, Pro-Pac sent an email
indicating that the parties were unable to reach a deal.
WOW responded on August 9, 2006, agreeing to “table
the idea for now.”
4 No. 12-2976
While Pro-Pac and WOW were engaged in these nego-
tiations, Chapes and WOW were secretly in contact
with each other about a business opportunity with
Vangard Distribution, Inc. (Vangard). Vangard was a
warehouse company, whose president had called
Chapes on August 2, 2006, with information about a
substantial business deal. Vangard had a customer who
needed storage for an overflow of sugar, but Chapes
had only 24 hours to commit to the deal. Even though
Chapes was working for Pro-Pac to secure accounts
with companies like Vangard, he informed WOW about
the deal, allowing WOW to negotiate a short-term agree-
ment with Vangard and secure the Vangard account.
Chapes and WOW remained in contact after the
Vangard deal. Throughout August 2006, Chapes and
WOW called each other numerous times and WOW
began to issue checks to Chapes for his commission on
the Vangard deal. In November 2006, Pro-Pac reminded
WOW that Pro-Pac should be included in any communica-
tion between WOW and Chapes. WOW, however, had
purchased a disposable cell phone for Chapes to use
for its calls to him. WOW representative(s) also accom-
panied Chapes on a trip to Idaho to meet a substantial
client at about the same time. WOW continued to pay
Chapes for the Vangard deal in amounts totaling $6,490,
and in early 2007, WOW hired Chapes.
Pro-Pac filed for Chapter 11 bankruptcy on Novem-
ber 20, 2006, and filed an adversary proceeding against
WOW and Chapes on May 19, 2007. Among other al-
legations, Pro-Pac alleged that Chapes, aided and abbetted
No. 12-2976 5
by WOW, breached his fiduciary duty to Pro-Pac by
diverting business to WOW. Pro-Pac remained unaware
of the full extent of the ongoing relationship between
WOW and Chapes until WOW released documents
during discovery that revealed the amount of revenues
from the Vangard account. Pro-Pac presented several
claims in its initial complaint, on some of which the
bankruptcy court granted partial summary judgment,
and Pro-Pac abandoned others. Ultimately, Pro-Pac
proceeded with a single claim: for breach of fiduciary
duty based on Chapes’s diversion of the Vangard deal
to WOW, and for WOW’s aiding and abetting of
Chapes’s breach of fiduciary duty.
The bankruptcy court conducted a bench trial on
June 7-8, 2011, during which Pro-Pac presented evidence
to support its claims and its theory of damages. Pro-Pac’s
theory of damages was based on the lost brokerage com-
mission it would have received if Chapes had informed
Pro-Pac of the Vangard deal and Pro-Pac had acted as a
broker between Vangard and WOW. Pro-Pac claimed
that it would have received a 10% commission on the
Vangard account and calculated that this 10% commis-
sion was worth $467,220. Pro-Pac did not seek to add
any other causes of action, and, in any event, WOW
specifically withheld its consent to the addition or con-
sideration by the court of any new claims:
Your Honor, as long as you’re on a little hiatus here,
I also want to make clear that I am [in] no way con-
senting to the trial [of] claims that have [not] been
[pled]—such that there is a potential amendment to
6 No. 12-2976
the pleadings or anything like that. I’ve said that
before, I’ll reiterate it now.
At the conclusion of the witnesses’ testimony and ex-
hibits, the parties agreed that the remaining evidence and
arguments could be presented through deposition tran-
scripts and post-trial briefs.
In its post-trial brief, Pro-Pac stated that “an alternative
application of the facts under the doctrine of unjust
enrichment would result in damages of $385,000.” Pro-Pac
supported this contention by arguing that it would
have received two months of free rent per year for five
years if its negotiations with WOW for Chapes’s services
had been completed. Even though the negotiations for
Chapes’s services were not consummated, WOW re-
ceived Chapes’s services without having to pay anything
for them to Pro-Pac, e.g., the two months of free rent per
year for five years. Based on its rent payment of $38,500
per month, Pro-Pac calculated that WOW was thus un-
justly enriched in the amount of $385,000. In its re-
sponse, WOW argued that “Pro-Pac’s unjust enrich-
ment theory must be rejected” because Pro-Pac never
pled it. In reply, Pro-Pac did not offer further argument
on the theory of unjust enrichment.
In a memorandum opinion dated September 27, 2011,
the bankruptcy court determined that Chapes had
breached his fiduciary duty to Pro-Pac and that WOW
had aided and abetted that breach. Determining the
damages was more complicated. The bankruptcy court
rejected Pro-Pac’s argument that it was entitled to a
10% commission on the Vangard deal, reasoning that “the
No. 12-2976 7
Vangard deal was far from finalized” and that Pro-Pac
“provided no industry expert testimony in support” of
its assertion that a 10% commission was an industry
standard.
The bankruptcy court, apparently misunderstanding
Pro-Pac’s argument, viewed Pro-Pac’s theory as a new,
independent unjust-enrichment claim. Such a claim, it
observed, had not been included in Pro-Pac’s initial
pleading. The bankruptcy court therefore, in reliance
on Federal Rule of Bankruptcy Procedure 7015, addressed
Pro-Pac’s theory of unjust enrichment as a new claim.
This bankruptcy rule incorporates Federal Rule of Civil
Procedure 15, which sets out procedures for amending
a pleading based on an objection at trial. The bank-
ruptcy court noted WOW’s objection interposed during
the trial, but concluded that WOW would not suffer
any prejudice if the pleadings were amended, thus al-
lowing consideration of Pro-Pac’s theory of unjust en-
richment.
Applying Pro-Pac’s theory of unjust enrichment to
calculate damages, the court invoked Seventh Circuit
precedent, noting that a “cause of action” contains three
elements: “(1) a benefit conferred upon the defendant
by the plaintiff, (2) appreciation by the defendant of the
fact of such benefit, and (3) acceptance and retention by
the defendant of the benefit, under circumstances such
that it would be inequitable to retain the benefit without
payment of the value thereof.” Lindquist Ford, Inc. v.
Middleton Motors, Inc., 557 F.3d 469, 477 (7th Cir. 2009)
(internal quotation marks omitted). The court found
8 No. 12-2976
that Pro-Pac had established each of these three ele-
ments and proceeded to calculate the damages. Re-
garding the claim against Chapes, the court ruled that
“[t]he actual damages against Chapes are computed as
the $6,490 referral fee he received from WOW.”
Regarding the claim against WOW, the court ruled that
“[t]he actual damages against WOW are $385,000, repre-
senting two months’ rent . . . for a total of five years.”
Additionally, because of Chapes’s and WOW’s “proven
intentional disregard of Pro-Pac’s rights,” the bankruptcy
court imposed punitive damages in the amount of
$50,000 against Chapes and $50,000 against WOW.
Chapes and WOW appealed separately to the district
court, and the district court issued two separate rulings
resolving their appeals. On May 30, 2012, the district
court affirmed the bankruptcy court’s decision against
Chapes for breach of his fiduciary duty and ruled that
the punitive damages award was not excessive on the
ground that even though “the actual damages against
Chapes equaled a mere $6,490—representing the referral
fee he received from WOW—the actual damages
against WOW equaled $385,000.” Therefore, “taking
into account the entirety of the circumstances of this
case,” the court upheld the punitive damages award of
$50,000 against Chapes. This ruling has not been ap-
pealed and thus is final.
A few months later, on August 14, 2012, the district
court issued a ruling reversing and remanding the bank-
ruptcy court’s verdict against WOW. The district court
held that Federal Rule of Civil Procedure 15(b)(1) was not
No. 12-2976 9
applicable and that the bankruptcy court had no other
basis for considering Pro-Pac’s theory of unjust enrich-
ment. This led the court to the conclusion that Pro-Pac
was not entitled to damages based on unjust enrichment,
and, without those damages, punitive damages were
also improper. The district court thus reversed and re-
manded the appeal “with instructions to dismiss the
claims against [WOW].” Pro-Pac filed a timely appeal
of this ruling.1
II. Discussion
We review the factual findings of the courts below for
clear error but review their legal conclusions de novo.
Rivinius, Inc. v. Cross Mfg., Inc. (In re Rivinius, Inc.), 977
F.2d 1171, 1175 (7th Cir. 1992). Although the bank-
ruptcy court and the district court both analyzed Civil
Procedure Rule 15 to address Pro-Pac’s theory of unjust
enrichment, we see no need to amend the pleadings to
include this theory of damages. We hold that the bank-
ruptcy court and the district court erred by not con-
sidering Bankruptcy Rule 7054. The bankruptcy rule
incorporates Civil Procedure Rule 54(a)-(c), which
provides that a trial court “should grant the relief to
which each party is entitled, even if the party has not
1
The district court did not reexamine this ruling against
Chapes when it reversed and remanded the determination
of the bankruptcy court against WOW, and Chapes has not
sought reconsideration of the ruling against him. Thus, we
do not address any issues relating to Chapes’s case.
10 No. 12-2976
demanded that relief in its pleadings.” See also Heitmann
v. City of Chi., 560 F.3d 642, 645 (7th Cir. 2009) (“Prevailing
parties get the relief to which they are entitled, no
matter what they ask for.”). To ensure that prevailing
parties receive an appropriate recovery of damages
when liability has been established, the appellate court
ordinarily remands the case with instructions to the
trial court to properly calculate the damages. See, e.g.,
Peabody v. Davis, 636 F.3d 368, 374-79 (7th Cir. 2011).
In its memorandum opinion, the bankruptcy court
ruled that WOW was liable to Pro-Pac for aiding and
abetting Chapes’s breach of fiduciary duty. Chapes’s
breach of fiduciary duty is recognized as a tort under
Wisconsin law. See Zastrow v. Journal Commc’ns, Inc.,
718 N.W.2d 51, 62 (Wis. 2006). WOW is also liable in
tort for aiding and abetting Chapes’s breach of fiduciary
duty. Restatement (Second) of Torts § 874 cmt. c (1979)
(“A person who knowingly assists a fiduciary in com-
mitting a breach of trust is himself guilty of tortious
conduct . . . .”); see also Loehrke v. Wanta Builders, Inc.,
445 N.W.2d 717, 721 (Wis. Ct. App. 1989) (citing § 874).
Despite the bankruptcy court’s liability determination
against WOW, the district court instructed the bank-
ruptcy court to dismiss those claims, thus vacating
the basis for any damages in Pro-Pac’s favor. We hold
that Pro-Pac is entitled to damages, however. Given the
bankruptcy court’s improper calculation of damages,
remand is appropriate.
On remand, the bankruptcy court has a variety of
options under Wisconsin law in crafting a remedy based
on WOW’s liability. Restitution may be available as an
No. 12-2976 11
equitable remedy in tort under Wisconsin law to
offset WOW’s unjust enrichment. Puttkammer v. Minth,
266 N.W.2d 361, 363 (Wis. 1978); Gross Common Carrier
v. Quick-N-Clean Corp., 132 N.W.2d 576, 578 (Wis. 1965).
While one recognized measure of damages is based
on the harm inflicted on the plaintiff, restitution is
another recognized option, which is measured by “the
defendant’s gain or benefit.” Ludyjan v. Cont’l Cas. Co., 747
N.W.2d 745, 749 (Wis. Ct. App. 2008) (quoting 1 Dan B.
Dobbs, Dobbs Law of Remedies: Damages, Equity, Res-
titution § 3.1, at 280 (2d ed. 1993)) (internal quotation
marks omitted).
Wisconsin law does not limit restitution to merely
unjust enrichment claims, but also allows plaintiffs to
receive restitution as compensation for tort claims:
In cases in which a tortfeasor has received from the
commission of a tort against another person a benefit
that constitutes unjust enrichment at the expense of
the other, he is ordinarily liable to the other, at the
latter’s election, either for the damage done to the
other’s interests or for the value of the benefit
received through the commission of the tort.
N. Air Servs., Inc. v. Link, No. 2008AP2897, 2012 WL 130531,
at *4 (Wis. Ct. App. Jan. 18, 2012) (footnote omitted)
(quoting Restatement (Second) of Torts § 903 cmt. b
(1979)).2
2
Although the Restatement uses the phrase “unjust enrich-
ment” in this excerpt, Link clarified in a footnote that
this phrase “refers to unjust enrichment as a concept in
(continued...)
12 No. 12-2976
Wisconsin courts have also recognized restitution as
an appropriate remedy for a tortious breach of fiduciary
duty. In Hartford Elevator, Inc. v. Lauer, the Wisconsin
Supreme Court ruled that restitution was an appropriate
remedy for an employee who breached his fiduciary
duty to his employer. 289 N.W.2d 280, 281-82 (Wis. 1980).
Although the complaint alleged a cause of action based
on the employee’s contract, the court analyzed the issue
in terms of the employee’s breach of fiduciary duty. Id.
at 284-85. Regardless of whether a breach of a fiduciary
duty is pled as a tort or contract claim, the same legal
analysis applies to both types of claims when they over-
lap. See Loehrke, 445 N.W.2d at 720 (“If, however, a
tort duty coincides with a contract obligation, either
a contract or a tort action will lie for its breach. A tort
duty coincides with a contractual obligation when the
breaching party has a fiduciary duty to the other party.”
(internal citation omitted)).
The Wisconsin Supreme Court also upheld an award
of restitution for a breach of fiduciary duty in Dick &
Reuteman Co. v. Doherty Realty Co., 114 N.W.2d 475(Wis. 1962). There it ruled that an insurance broker
should pay back insurance commissions because the
broker had wrongfully acquired the commissions by
breaching a fiduciary duty created by a trust. Id. at 482-83.
This case later appeared as Illustration 19 of § 43 of the
2
(...continued)
damages law, not as a formal legal claim.” 2012 WL 130531,
at *4 n.6.
No. 12-2976 13
Restatement (Third) of Restitution & Unjust Enrichment
(2011), which states:
A person who obtains a benefit
(a) in breach of a fiduciary duty,
(b) in breach of an equivalent duty imposed by
a relation of trust and confidence, or
(c) in consequence of another’s breach of such
a duty,
is liable in restitution to the person to whom the duty
is owed.
Id. at § 43.
Finally, the Restatement (Second) of Torts explains
in detail the manner in which restitution for a breach
of fiduciary duty can be calculated:
In addition to or in substitution for . . . damages
[for harm,] the beneficiary may be entitled to
restitutionary recovery, since not only is he entitled
to recover for any harm done to his legally pro-
tected interests by the wrongful conduct of the fidu-
ciary, but ordinarily he is entitled to profits that
result to the fiduciary from his breach of duty and
to be the beneficiary of a constructive trust in the
profits. . . .
. . . The measure of . . . liability [for a defendant who
assisted in the breach of a fiduciary duty], however,
may be different from that of the fiduciary since he
is responsible only for harm caused or profits that he
himself has made from the transaction, and he is
14 No. 12-2976
not necessarily liable for the profits that the fiduciary
has made nor for those that he should have made.
Restatement (Second) of Torts § 874 cmt. b-c (1979); see
also Loehrke, 445 N.W.2d at 721 (citing § 874).
To award restitution damages in favor of Pro-Pac
requires an examination of WOW’s profits from the
Vangard deal. The bankruptcy court determined that
by encouraging Chapes to breach his fiduciary duty,
WOW helped direct the Vangard deal from Pro-Pac to
itself, from which WOW presumably benefitted. The
record is underdeveloped on this point, indicating only
that WOW’s revenues on the Vangard deal averaged
$62,670 per month. Even if this number is accurate, it
does not likely reflect profits, which would be based on
a determination of revenues as well as costs. If the bank-
ruptcy court pursues this remedy, unless the parties
stipulate to WOW’s profit from the Vangard deal, the
bankruptcy court must direct the parties to properly
develop these facts.
Alternatively, the “value of the benefit received
through the commission of the tort” (i.e., Chapes’s con-
sulting services) could be measured by examining
what WOW was willing to exchange for those services
immediately prior to its tortious conduct. During nego-
tiations in the summer of 2006, WOW offered Pro-Pac
free rent for two months per year for five years in ex-
change for Chapes’s services, but following Chapes’s
referral of the Vangard deal to WOW, the negotiations
between Pro-Pac and WOW ceased. As a result, WOW
obtained access to Chapes’s contacts without providing
No. 12-2976 15
Pro-Pac any payment, including the free rent. Pro-Pac
calculated the value of this free rent as $385,000. But this
value does not reflect a present-value calculation, which
would discount the rent amount over the five-year
time period. It is also debatable whether $385,000, the
value WOW placed on five years of Chapes’s services,
represents a fair approximation of the value of the
(much briefer) services wrongfully obtained. On the
other hand, we note that WOW initially offered Pro-Pac
significant rent concessions over a shorter period of
time for the privilege of speaking with Chapes, regardless
of whether Chapes’s contacts helped WOW to secure
any new business opportunities; this suggests a “floor”
on the value of the services wrongfully obtained. If the
bankruptcy court wishes to pursue this remedy, unless
the parties are able to stipulate to the value of services
that WOW received when the negotiations fell apart,
the bankruptcy court must require the parties to
properly develop these facts.
The bankruptcy court could also choose to award
compensatory damages that address the harm sustained
by Pro-Pac. This compensatory measure of liability and
restitution often overlap, such that “the benefit to the
one and the loss to the other are co-extensive.” Restate-
ment (First) of Restitution § 1 cmt. d (1937); see also
Lawlis v. Thompson, 405 N.W.2d 317, 320 (Wis. 1987) (citing
§ 1). Under a compensatory damages theory, Pro-Pac
would be entitled to receive the benefit of the free rent
that it lost when WOW discontinued its negotiations
for Chapes’s services. As previously noted, the bank-
ruptcy court estimated that these damages amount to
16 No. 12-2976
$385,000, but again, this does not reflect a present-value
calculation. Nor is it clear that this amount, which
reflects five years’ worth of losses, is an appropriate
measure of the harm caused by WOW’s single breach.
If the bankruptcy court wishes to pursue this remedy,
unless the parties stipulate to the value of the free rent
that Pro-Pac lost, the bankruptcy court must require
the parties to properly develop these facts.
Regardless of whether the bankruptcy court awards
damages premised on gain to WOW (i.e., restitutionary
damages) or loss to Pro-Pac (i.e., compensatory dam-
ages), punitive damages are also available, if otherwise
appropriate. Wisconsin law allows awards of punitive
damages when “compensatory damages” are imposed.
Groshek v. Trewin, 784 N.W.2d 163, 174-76 (Wis. 2010). The
Restatement (Second) of Torts defines “compensatory
damages” as “the damages awarded to a person as com-
pensation, indemnity or restitution for harm sustained
by him,” Restatement (Second) of Torts § 903 (1979), and
Wisconsin has adopted this definition, Link, 2012 WL
130531, at *3 n.4. Pro-Pac’s reliance on any particular
theory of tort damages does not foreclose an award of
punitive damages to deter intentional wrongdoing,
if such damages are deemed appropriate.
We leave to the bankruptcy court whatever discretion
is necessary to formulate an appropriate remedy in Pro-
Pac’s favor based on WOW’s tort liability. If the district
court is not satisfied, of course, the district court can
withdraw the reference and resolve the issues itself. 28
U.S.C. § 157(d) (“The district court may withdraw, in
No. 12-2976 17
whole or in part, any case or proceeding referred under
this section, on its own motion or on timely motion of any
party, for cause shown.”); see also Home Ins. Co. of Ill. v.
Adco Oil Co., 154 F.3d 739, 741-42 (7th Cir. 1998).
III. Conclusion
The bankruptcy court erred in its determination
that WOW must pay $385,000 in damages to Pro-Pac
based on Pro-Pac’s unjust-enrichment theory. The case is
remanded to the district court and to the bankruptcy
court to reformulate the award of damages based on
WOW’s aiding and abetting of Chapes’s breach of
fiduciary duty. The judgment of the district court is
R EVERSED and the cause R EMANDED with instructions
to remand to the bankruptcy court for further pro-
ceedings consistent with this opinion.
M ANION, Circuit Judge, concurring in part, dissenting
in part. I concur with the court’s per curiam opinion
with the exception of the court’s final analysis
holding that punitive damages could be available even
when the court awards only restitution based on the
defendant’s gain (as opposed to the plaintiff’s loss). As
18 No. 12-2976
I see it, Wisconsin law does not permit punitive damages
unless there has been an award of compensatory dam-
ages. Groshek v. Trewin, 784 N.W.2d 163, 176 (Wis. 2010)
(“[W]here there is no award of compensatory damages,
punitive damages are not available.”); see also Tucker v.
Marcus, 418 N.W.2d 818, 823 (Wis. 1988) (holding that
“punitive damages are not available where there has
been no ‘award’ of actual damages” (emphasis added)).
Restitution based on the defendant’s gain is not a form
of compensatory damages under Wisconsin law. For
starters, restitution and compensatory damages are not
calculated in the same way; compensatory damages are
based on the harm suffered by the plaintiff, while res-
titution is based on the defendant’s gain. Because these
remedies are calculated differently and do not always
produce the same value of damages, restitution based
on the defendant’s gain is treated as an alternative
remedy to compensatory damages. See Restatement
(Second) of Torts § 903 cmt. b (1979) (cited in N. Air Servs.,
Inc. v. Link, No. 2008AP2897, 2012 WL 130531, at *3 n.4
(Wis. Ct. App. Jan. 18, 2012)). Furthermore, restitution is
an equitable remedy, and Wisconsin still retains a dis-
tinction between law and equity for damages purposes.
See Groshek, 784 N.W.2d at 175.
Therefore, restitution based on the benefit that WOW
received would not be a sufficient basis for punitive
damages. If the bankruptcy court wishes to award
punitive damages, it must first award compensatory
damages based on the harm Pro-Pac suffered.
6-26-13