SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
Current Report On
FORM 8-K
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported):
DECEMBER 22, 1999
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Commission Registrant; State of Incorporation IRS Employer
File Number Address; and Telephone Number Identification No.
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1-9057 WISCONSIN ENERGY CORPORATION 39-1391525
(A Wisconsin Corporation)
231 West Michigan Street
P.O. Box 2949
Milwaukee, WI 53201
(414) 221-2345
1-1245 WISCONSIN ELECTRIC POWER COMPANY 39-0476280
(A Wisconsin Corporation)
231 West Michigan Street
P.O. Box 2046
Milwaukee, WI 53201
(414) 221-2345
FORM 8-K
WISCONSIN ENERGY CORPORATION
WISCONSIN ELECTRIC POWER COMPANY
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ITEM 5. OTHER EVENTS
GIDDINGS & LEWIS INC./ CITY OF WEST ALLIS LAWSUIT
As previously reported, iron-cyanide-bearing wastes were found at two sites
in West Allis, Wisconsin. One site is on property formerly owned by
Kearney & Trecker Corporation, now a part of Giddings & Lewis Inc. The
other site is owned by the City of West Allis. Environmental remediation
at both sites was completed several years ago, with the current owners
paying for disposal of materials found on their respective portions of the
sites.
On July 25, 1996, Giddings & Lewis, Kearney & Trecker and the City of West
Allis filed an action for damages in the Milwaukee County Circuit Court
against Wisconsin Electric Power Company, the wholly owned, principal
subsidiary of Wisconsin Energy Corporation, alleging that Wisconsin
Electric was responsible for depositing the material in 1959 and therefore
liable to the plaintiffs. Investigations into the potential source of the
waste led Wisconsin Electric to believe that it was not the source of this
waste.
On July 14, 1999, a Milwaukee County Circuit Court jury issued a verdict
against Wisconsin Electric in the lawsuit that awarded the plaintiffs
$4.5 million as actual damages for clean-up costs and loss of property
value and also awarded the plaintiffs $100 million in punitive damages. On
October 6, 1999, the Wisconsin trial court judge denied Wisconsin
Electric's post trial motions and directed that judgment on the verdict be
entered. On November 12, 1999, Wisconsin Electric filed a notice of appeal
of the case to the Wisconsin Court of Appeals.
By statute under Wisconsin law, interest at the rate of 12% per annum
accrues until the funds are tendered or until the judgment is reversed. If
funds are tendered during the pendency of an appeal, Wisconsin law further
provides that upon reversal or reduction of the judgment there shall be
restitution with interest of the applicable amount of any funds tendered.
In order to stop the accrual of interest at 12% during the pendency of the
appeal, Wisconsin Electric filed a motion with the trial court on November
12, 1999 requesting that Wisconsin Electric be permitted to tender the
funds to the court pursuant to a stay of execution. That stay of execution
motion was denied by the trial court and an appeal of the trial court's
ruling on the motion was denied by the Wisconsin Court of Appeals on
December 22, 1999. Thus, in order to cease any further accrual of interest
at the rate of 12% per annum, Wisconsin Electric has tendered to the
Milwaukee County Clerk of Circuit Court the judgment amount including
interest to date aggregating $110.2 million. By statute under Wisconsin
law, plaintiffs are thereafter liable to Wisconsin Electric upon reversal
or reduction of the judgment for the applicable amount of the funds
tendered with interest.
As previously reported, the motion for sanctions, which was filed by
plaintiffs as a post-trial proceeding, has been scheduled to be heard
before the trial court judge on January 19th and 20th, 2000. Wisconsin
Electric will vigorously defend against the plaintiffs' allegations and
does not believe that any sanctionable conduct has occurred.
In the opinion of management, based in part on the advice of legal counsel,
the jury verdict was not supported by the evidence or the law and the
unprecedented award of punitive damages of this magnitude was unwarranted
and should therefore be reversed or substantially reduced on appeal.
* * * * * * * * * * *
This report contains some forward-looking statements. Forward-looking
statements are subject to risks, uncertainties and assumptions which could
cause actual results to differ materially. Litigation is unpredictable and
the outcome is inherently uncertain and subject to what the court considers
to be determinative. We undertake no obligation to publicly update any
forward-looking statement, whether as a result of new information, future
events or otherwise.
FORM 8-K
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
WISCONSIN ENERGY CORPORATION
(Registrant)
/s/T. H. Fehring
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Date: December 30, 1999 T. H. Fehring, Corporate Secretary
WISCONSIN ELECTRIC POWER COMPANY
(Registrant)
/s/T. H. Fehring
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Date: December 30, 1999 T. H. Fehring, Corporate Secretary
