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93–797 PDF 2015

LAWSUIT ABUSE REDUCTION ACT OF 2015 

HEARING 

BEFORE THE

SUBCOMMITTEE ON THE CONSTITUTION 

AND CIVIL JUSTICE 

OF THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

ON

H.R. 758 

MARCH 17, 2015 

Serial No. 114–15 

Printed for the use of the Committee on the Judiciary 

( 

Available via the World Wide Web: http://judiciary.house.gov 
(II) 

COMMITTEE ON THE JUDICIARY 

BOB GOODLATTE, Virginia, Chairman 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

LAMAR S. SMITH, Texas 

STEVE CHABOT, Ohio 

DARRELL E. ISSA, California 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

TED POE, Texas 

JASON CHAFFETZ, Utah 

TOM MARINO, Pennsylvania 

TREY GOWDY, South Carolina 

RAU ́ L LABRADOR, Idaho 

BLAKE FARENTHOLD, Texas 

DOUG COLLINS, Georgia 

RON DeSANTIS, Florida 

MIMI WALTERS, California 

KEN BUCK, Colorado 

JOHN RATCLIFFE, Texas 

DAVE TROTT, Michigan 

MIKE BISHOP, Michigan 

JOHN CONYERS, JR., Michigan 

JERROLD NADLER, New York 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

STEVE COHEN, Tennessee 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

PEDRO R. PIERLUISI, Puerto Rico 

JUDY CHU, California 

TED DEUTCH, Florida 

LUIS V. GUTIERREZ, Illinois 

KAREN BASS, California 

CEDRIC RICHMOND, Louisiana 

SUZAN DelBENE, Washington 

HAKEEM JEFFRIES, New York 

DAVID N. CICILLINE, Rhode Island 

SCOTT PETERS, California 

SHELLEY HUSBAND, Chief of Staff & General Counsel 

PERRY APELBAUM, Minority Staff Director & Chief Counsel 

SUBCOMMITTEE ON THE CONSTITUTION AND CIVIL JUSTICE

TRENT FRANKS, Arizona, Chairman 

RON DeSANTIS, Florida, Vice-Chairman 

STEVE KING, Iowa 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

STEVE COHEN, Tennessee 

JERROLD NADLER, New York 

TED DEUTCH, Florida 

PAUL B. TAYLOR, Chief Counsel 

JAMES J. PARK, Minority Counsel 
(III) 

C O N T E N T S 

MARCH 17, 2015 

Page 

THE BILL 

H.R. 758, the ‘‘Lawsuit Abuse Reduction Act ........................................................ 3 

OPENING STATEMENTS 

The Honorable Trent Franks, a Representative in Congress from the State 

of Arizona, and Chairman, Subcommittee on the Constitution and Civil 

Justice ................................................................................................................... 1 

The Honorable Steve Cohen, a Representative in Congress from the State 

of Tennessee, and Ranking Member, Subcommittee on the Constitution 

and Civil Justice ................................................................................................... 5 

The Honorable Bob Goodlatte, a Representative in Congress from the State 

of Virginia, and Chairman, Committee on the Judiciary ................................. 9 

WITNESSES 

Elizabeth Milito, Senior Executive Counsel, NFIB Small Business Legal Center 

Oral Testimony ..................................................................................................... 11 

Prepared Statement ............................................................................................. 13 

Robert S. Peck, President, Center for Constitutional Litigation, PC 

Oral Testimony ..................................................................................................... 23 

Prepared Statement ............................................................................................. 25 

Cary Silverman, Partner, Shook, Hardy & Bacon LLP 

Oral Testimony ..................................................................................................... 44 

Prepared Statement ............................................................................................. 46 

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Material submitted by the Honorable Steve Cohen, a Representative in Congress from the State of Tennessee, and Ranking Member, Subcommittee 

on the Constitution and Civil Justice ................................................................. 7 

Material submitted by the Honorable Ted Deutch, a Representative in Congress from the State of Florida, and Member, Subcommittee on the Constitution and Civil Justice ................................................................................... 66 

APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD

Prepared Statement of Ralph Nader ...................................................................... 95 

Letter from the American Bar Association (ABA) ................................................ 96 

Response to Questions for the Record from Robert S. Peck, President, Center 

for Constitutional Litigation, PC ........................................................................ 100 

(1) 

LAWSUIT ABUSE REDUCTION ACT OF 2015 

TUESDAY, MARCH 17, 2015 

HOUSE OF REPRESENTATIVES

SUBCOMMITTEE ON THE CONSTITUTION

AND CIVIL JUSTICE

COMMITTEE ON THE JUDICIARY

Washington, DC. 

The Subcommittee met, pursuant to call, at 10:06 a.m., in room 

2141, Rayburn Office Building, the Honorable Trent Franks, 

(Chairman of the Subcommittee) presiding. 

Present: Representatives Franks, Goodlatte, Gohmert, Cohen, 

Nadler, and Deutch. 

Staff Present: (Majority) Paul Taylor, Subcommittee Chief Counsel; Tricia White, Clerk; (Minority) James Park, Minority Counsel; 

and Veronica Eligan, Professional Staff Member. 

Mr. FRANKS. The Subcommittee on the Constitution and Civil 

Justice will come to order. Without objection, the Chair is authorized to declare recesses of the Committee at any time. Good morning. 

Currently, Rule 11 of the Federal Rules of Civil Procedure sets 

out one of the most basic requirements for litigation in Federal 

court, that papers filed with a Federal district court must be based 

on both the facts and the law. 

That is to say, anytime a litigant signs a filing in Federal court, 

they are certifying that ‘‘to the best of the person’s knowledge, information, and belief’’ the filing is accurate, based on the law or 

reasonable interpretation of the law, and is brought for a legitimate 

purpose. 

Now, this is a simple requirement, one that both sides to a lawsuit must abide by, if we are to properly have a functional Federal 

court system. However, under the current Federal procedure rules, 

there is no requirement that a failure to comply with Rule 11 results in sanctions for the party that filed that frivolous lawsuit. 

The fact that litigants can violate Rule 11 without penalty significantly reduces the deterrent effect of Rule 11. 

This harms the integrity of the Federal courts and forces both 

plaintiffs and defendants to spend money to respond to frivolous 

claims and arguments with no guarantee of compensation when the 

claims against them are found frivolous by a Federal judge. 

The Lawsuit Abuse Reduction Act corrects this flaw by requiring 

that Federal district court judges impose sanctions when Rule 11 

is violated. It will relieve litigants from the financial burden of hav-
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ing to response to frivolous claims by requiring those who violate 

Rule 11 to reimburse the opposing party reasonable expenses incurred as a direct result of the violation. 

Furthermore, the legislation eliminates Rule 11’s 21-day safe 

harbor provision, which currently gives litigants a free pass to 

make frivolous claims so long as they withdraw those claims if the 

opposing side objects within 21 days. As Justice Scalia correctly 

pointed out when Rule 11 was gutted in 1933, ‘‘Those who file frivolous suits and pleadings should have no safe harbor. Parties will 

be able to file thoughtless, reckless, and harassing pleadings, secure in the knowledge that they have nothing to lose. If objection 

is raised, they can retreat without penalty.’’ 

Now although this legislation makes changes to Rule 11, it is important to recognize that nothing in this legislation changes the 

standard by which courts determine whether a pleading or a filing 

violates Rule 11. Courts will apply the same legal standard they 

currently apply to determine if a filing is frivolous under the rule. 

So in the end, all this legislation really does is make the technical and conforming changes to Rule 11 necessary to make sanctions mandatory rather than discretionary. Victims of frivolous 

lawsuits are just as deserving of compensation as any other victim, 

and there is no reason those who are the victims of frivolous lawsuits in Federal court should be the only litigants to go without 

compensation when they prove their injuries in court. 

According to Federal Rules of Civil Procedure, the goal of the 

rules is to ensure that every action and proceeding in Federal court 

be determined in a ‘‘just, speedy, and inexpensive’’ manner. That 

goal is best served through mandatory sanctions for violating the 

simple requirements of Rule 11 that every filing be based on both 

the law and the facts. 

And finally, this bill has been introduced in the House and Senate in previous Congresses. This Congress is different. For the first 

time, this bill has been introduced in the Senate by the Chairman 

of the Senate Judiciary Committee himself, Senator Charles Grassley, who is a leading advocate for the rights of victims, including 

the victims of frivolous lawsuits. 

With that, I look forward to hearing from all of our witnesses 

today, and I would now recognize the Ranking Member of the Subcommittee, Mr. Cohen from Tennessee, for his opening statement. 

[The bill, H.R. 758, follows:] 
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Mr. COHEN. Thank you, Mr. Chair. 

Today, we consider H.R. 758, titled the ‘‘Lawsuit Abuse Reduction Act of 2015.’’ It is substantially identical to bills we considered 

in the 112th and 113th Congresses, and we have considered even 

earlier versions of this bill going back at least a decade. Given this 

fact, I have this Bill-Murray-like feeling of being here before in 

Groundhog Day. 

H.R. 758, like its predecessors, is a solution in search of a problem that would threaten to do more harm than good, if enacted. 

H.R. 758 would restore the 1983 version of Rule 11 of the Federal 

Rules of Civil Procedure by making sanctions for Rule 11 mandatory and eliminating the current safe-harbor provision that allows 

a party to withdraw or correct any allegedly offending submission 

to the court within 21 days after service of submission. 

Safe harbor is important. The Chair in his opening remarks said 

it just guarantees that people have recourse. Well, they have recourse, but it is up to the judge’s determination, and it is important 

that the judge have that discretion, I think. 

Moreover, the bill would go beyond the 1983 rule by requiring 

the court to award these reasonable attorney’s fees and costs. I am 

all in favor of Rule 11, and sanctioning attorneys that violate such 

with frivolous lawsuits. But right now, they are discretionary, in 

the court’s discretion. And we have judges for a reason, and they 

have more intimate knowledge of the facts and the circumstances 

and the attorneys involved in the safe-harbor option. 

No empirical evidence suggests there is a need, really, to change 

Rule 11. In fact, there were good reasons why the Judicial Conference of the United States amended the 1983 Rule 11. And for 

these same reasons, H.R. 758 is ill-advised. 

The 1983 rule caused excessive litigation. Many civil cases had 

a parallel track of litigation, referred to as satellite litigation, over 

Rule 11 violations, because having mandatory sanctions and no 

safe harbor provisions caused parties on both sides to litigate the 

Rule 11 matter to the bitter end, so courts become more loaded 

with crowded dockets. 

The dramatic increase in litigation spawned by the 1983 rule not 

only resulted in delays in resolving the underlying case, it increased costs for the litigants, but also strained our judicial resources. It is clear H.R. 758 will result in more, not less, litigation 

and impose a greater burden on the judiciary. 

Ultimately, the type of Rule 11 sanctions regime that H.R. 758 

envisions will only favor those with the money and resources to 

fight expensive and drawn-out litigation battles. H.R. 758 also 

threatens judicial independence by removing that discretion that 

judges presently have in determining whether or not to impose 

sanctions. It circumvents the painstakingly thorough rules-enabling 

act process by recklessly attempting to amend the rules directly, 

even over the Judicial Conference’s objections. 

I would like each of our witnesses to tell me a precedent where 

rather than our process being that the courts recommend and propose rules and we approve or disapprove, where we in the Congress 

have in the past changed the rules by legislation without the courts 

submitting rules. It is definitely a deviation in the process of the 

judiciary making the rules, with the check and balance of the legis-
6 

lature approving or disapproving. We can disapprove a rule or recommend, but I believe it is extremely rare. 

And I look forward to our experts telling me where the legislature has specifically made a law that changed a rule without the 

judiciary coming forth on that. 

We know the 1983 rule had a disproportionally chilling impact 

on civil rights cases, and that is most concerning to me and to others. And there is no reason to think H.R. 758 will not have such 

a similar chilling effect. 

We just came through the reenactment of the Selma march. We 

have seen so many failures in our legislative and political system, 

to where we haven’t moved forward on civil rights; we moved backward. And what happened in Selma, we need to see that we have 

vigorous enforcement of civil rights and voting rights. And this 

could be a chilling effect on civil rights cases that depend sometimes on novel arguments for the extension, modification, or reversal of existing laws that have brought us into the 21st century. 

Not surprisingly, the Federal Judicial Center found that the incidence of Rule 11 motions was higher in civil rights cases than 

other type of cases when the 1983 rule was in place, notwithstanding the fact that the 1983 rule was neutral on its face. 

Even a landmark case like the Brown v. Board of Education argument may have been delayed or may not have been pursued to 

its conclusion had our H.R. 758 changes to Rule 11 been in effect 

at the time. Certainly, the legal arguments in that case were novel 

and not based on existing law. At a minimum, defendants could 

have used Rule 11, as amended by H.R. 758, as a weapon to dissuade the plaintiffs or weaken their resolve. 

The Judicial Conference of the United States, the policymaking 

arm of the Federal judiciary, opposed legislation substantially identical to H.R. 758 last conference. Similarly, the American Bar Association in the past, and a coalition of groups concerned about justice—the Alliance for Justice, Consumer Federation of America, the 

National Consumer Law Center, and the National Employment 

Lawyers—previously opposed the measure. 

I ask unanimous consent to add a letter in opposition sent to the 

Subcommittee by Public Citizen dated March 16 be submitted into 

the record, and I appreciate that. 

Mr. FRANKS. Without objection. 

[The information referred to follows:] 
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Mr. COHEN. H.R. 758 takes away judicial discretion, which is so 

needed, and would result in more litigation rather than less. 

I urge my colleagues to oppose and yield back the balance of nonexistent balance of time. 

Mr. FRANKS. And I thank the gentleman. 

And I now yield to the Chairman of the Committee, Mr. Goodlatte of Virginia. 

Mr. GOODLATTE. Well, thank you, Mr. Chairman. 

H.R. 758, the ‘‘Lawsuit Abuse Reduction Act OF 2015,’’ would restore mandatory sanctions for frivolous lawsuits filed in Federal 

court. Many Americans may not realize it, but today, under what 

is called Rule 11 of the Federal Rules of Civil Procedure, there is 

no requirement that those who file frivolous lawsuits pay for the 

unjustified legal costs they impose on their victims, even when 

those victims prove to a judge the lawsuit was without any basis 

in law or fact. 

As a result, the current Rule 11 goes largely unenforced, because 

the victims of frivolous lawsuits have little incentive to pursue additional litigation to have the case declared frivolous when there is 

no guarantee of compensation at the end of the day. 

H.R. 758 would finally provide light at the end of the tunnel for 

the victims of frivolous lawsuits by requiring sanctions against the 

filers of frivolous lawsuits, sanctions which include paying back victims for the full costs of their reasonable expenses incurred as a 

direct result of the Rule 11 violation, including attorneys’ fees. 

The bill also strikes the current provisions in Rule 11 that allow 

lawyers to avoid sanctions for making frivolous claims and demands by simply withdrawing them within 21 days. This change 

eliminates the free pass lawyers now have to file frivolous lawsuits 

in Federal court. 

The lack of mandatory sanctions leads to the regular filing of 

lawsuits that are clearly baseless. For example, a man sued a 

small-business owner for violations of Federal regulations in a 

parking lot he doesn’t own or lease. A woman had her car repossessed and then filed a $5 million Federal lawsuit for the half tank 

of gas she had left in the car. A high school teacher sued a school 

district, claiming it discriminated against her because she has a 

phobia, a fear of young children. Her case was dismissed by the 

Equal Employment Opportunity Commission, but that didn’t prevent her from filing a Federal lawsuit. 

These real yet absurd cases have real-life consequences for their 

victims. But the victims of lawsuit abuse are not just those who are 

actually sued. Rather, we all suffer under a system in which innocent Americans everywhere live under the constant fear of a potentially bankrupting frivolous lawsuit. 

As the former chairman of The Home Depot company has written, an unpredictable legal system casts a shadow over every plan 

and investment. It is devastating for startups. The cost of even one 

ill-timed abusive lawsuit can bankrupt a growing company and cost 

hundreds of thousands of jobs. 

The prevalence of frivolous lawsuits in America is reflected in the 

absurd warning labels companies must place on their products to 

limit their exposure to frivolous claims. A 5-inch brass fishing lure 

with three hooks is labeled ‘‘harmful if swallowed.’’ In a warning 
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label on a baby stroller, the caution is ‘‘remove child before folding.’’ A sticker on a 13-inch wheel on a wheelbarrow warns, ‘‘not 

intended for highway use.’’ A household iron contains the warning, 

‘‘never iron clothes while they are being worn.’’ And a cardboard 

car sun shield that keeps sun off the dashboard warns, ‘‘do not 

drive with sun shield in place.’’ 

In his 2011 State of the Union address, President Obama said, 

quote, ‘‘I am willing to look at other ideas to rein in frivolous lawsuits.’’ Mr. President, here it is, a one-page bill that would significantly reduce the burden of frivolous litigation on innocent Americans. 

I thank the former Chairman of this Committee, Lamar Smith, 

for introducing this simple, common-sense legislation that would do 

so much to prevent lawsuit abuse and restore Americans’ confidence in the legal system. 

I look forward to hearing the testimony of our witnesses, and I 

yield back. 

Thank you, Mr. Chairman. 

Mr. FRANKS. And I thank the gentleman. 

And without objection, other Members’ opening statements will 

be made part of the record. 

So let me now introduce our witnesses. Good morning to all of 

you. 

Our first witness is Elizabeth Milito, the senior executive counsel 

with the National Federation of Independent Business’ Small Business Legal Center. Previously, she has worked for the U.S. Department of Veterans Affairs where she focused on employment and 

labor matters, a former editor of Notes and Comments for the 

Maryland Law Review, and a graduate of the University of Maryland’s School of Law. Ms. Milito is responsible for managing cases 

and legal work for the NFIB Small Business Legal Center and 

working on labor and employment policy. 

Glad to have you here. 

Our second witness is Robert Peck, president of the Center for 

Constitutional Litigation. Mr. Peck has taught constitutional law 

and State constitutional law at the George Washington University 

Law School and American University Washington College of Law 

as a member of adjunct faculty. He is a co-chair of the Lawyers 

Committee of the National Center for State Courts, and a delegate 

in the American Bar Association’s House of Delegates. 

Welcome, sir. 

Our third witness is Cary Silverman, a partner at the Shook, 

Hardy & Bacon Law firm in Washington, D.C. Mr. Silverman’s 

public policy work focuses on civil justice reform, and he has published over 25 articles in prominent law journals. He is a recipient 

of the Burton Award for Excellence in Legal Writing, and an adjunct professor at the George Washington University Law School, 

where he earned his J.D. and master’s of public administration. 

Welcome, sir. 

Each of the witnesses’ written statements will be entered into 

the record in its entirety, so I would ask that each of you summarize his or her testimony in 5 minutes or less. And to help you stay 

within that time, there is a timing light in front of you. The light 

will switch from green to yellow, indicating that you have 1 minute 
11 

to conclude your testimony. When the light turns red, it indicates 

that the witness’s 5 minutes have expired. 

And before I recognize the witness, it is the tradition of the Subcommittee that they be sworn, so if you would please stand and be 

sworn. 

Do you solemnly swear that the testimony that you are about to 

give will be the truth, the whole truth, and nothing but the truth, 

so help you God? 

You may be seated. 

Let the record reflect that the witnesses answered in the affirmative. 

So I would now recognize our first witness, Ms. Milito. And, Ms. 

Milito, if you would make sure you turn that microphone on before 

speaking. 

TESTIMONY OF ELIZABETH MILITO, SENIOR EXECUTIVE 

COUNSEL, NFIB SMALL BUSINESS LEGAL CENTER 

Ms. MILITO. Thank you, Mr. Chairman, and distinguished Subcommittee Members for inviting me to provide testimony regarding 

the impact lawsuits, and particularly frivolous lawsuits, have on 

small businesses. 

While specific stories of lawsuit abuse vary from business to 

business, there is one reoccurring theme: This country’s legal climate hinders economic growth and hurts job creation. 

Due to this, NFIB’s members and small-business owners 

throughout the country are fed up with the inability to pass meaningful legal reform. When it comes to lawsuits and small business, 

today I wish to highlight four things. 

First, small businesses are easy targets for frivolous lawsuits. Sophisticated attorneys do not sue NFIB members. Instead, small 

businesses are more likely to be sued by smalltime lawyers, who 

threaten cookie-cutter lawsuits that are expected to be settled immediately. 

One of the most prevalent forms of lawsuit abuse occurs when 

plaintiffs or their attorneys are merely trolling for cases. A plaintiff 

or an attorney will travel from business to business, looking for violations of a particular law. In such cases, the plaintiff is generally 

not as concerned with correcting the problem as she is with extracting a settlement from a small-business owner. In many instances, the plaintiff’s attorney will initiate the claim, not with a 

lawsuit, but with a demand letter, requesting immediate settlement. 

In California, attorneys have been known to rake in several million dollars a year fleecing small-business owners with these sorts 

of schemes. Ann Kinner, who owns Seabreeze Books & Charts in 

Point Loma, California, is one such small-business owner and an 

NFIB member who has been targeted by frivolous litigation. 

Kinner’s store has been sued twice for ADA violations. She went 

to court, fought, and won both these lawsuits. But the defense has 

cost her $10,000, money she could have used, in her words, to pay 

a new employee for half a year. In Kinner’s words, ‘‘The only people 

who win in these cases are the lawyers.’’ 

Two, small businesses settle and avoid going to court. When a 

conflict arises, small businesses or the insurer on their behalf will 
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likely pay rather than fight a claim, whether there is a meritorious 

defense or not. Calculating attorneys know that they can extort settlements from small businesses by threatening to sue. Small businesses simply cannot absorb the costs of a legal battle as easily as 

larger businesses or, for that matter, the cost of paying damages 

if they should lose in the end. 

This means that, in many cases, the small-business owner may 

be risking financial ruin if the owner refuses to settle. Since there 

is no guarantee that, at the end of the fight, the defendant will prevail, small-business owners often rationally opt to avoid the costs 

of litigation by agreeing to settle claims that they believe to be 

without merit. Indeed, they will rationally decide to settle cases 

where they realize that the probable cost of litigation will exceed 

the benefit of winning in court. 

Three, small businesses pay more to fight frivolous claims. While 

NFIB members are loath to write a check to settle what they perceive to be a frivolous claim, they express as much, if not more, 

frustration with the time spent defending against a lawsuit. In the 

end, of course, time is money to a small-business owner. 

Once the suit is settled, however, the small-business owner will 

pay with higher insurance premiums. Typically, it is a fact that the 

small-business owner settled a case, for any amount, which drives 

up the insurance rates. It does not matter if the business owner 

was ultimately found liable. 

Many small-business owners understand this dynamic and, as a 

result, will settle claims without notifying their insurance carrier. 

As such, small businesses annually pay over $35 billion out of 

pocket to settle these claims. 

Four, small businesses support common-sense legal reform like 

H.R. 758. In crafting solutions here, we must acknowledge the 

practical circumstances of the small-business owner threatened 

with protracted legal battle. Regardless of whether the plaintiff’s 

claims are meritorious, the small-business owner faces a difficult, 

and often impossible, dilemma: Settle or risk everything. 

For this reason, NFIB has championed the Lawsuit Abuse Reduction Act, which focuses on tightening sanctions for frivolous 

lawsuits. This is the best reform, to date, to rein in the bottom 

feeders that target small business. 

Simply put, NFIB believes that this bill will help disincentive 

both plaintiff and defense attorneys from taking brash and cavalier 

legal positions that result in frivolous and protracted litigation. 

We are hopeful through your deliberations you can strike the appropriate balance to protect those who are truly harmed and the 

many unreported victims of our Nation’s civil justice—America’s 

small businesses. 

Thank you very much, and I look forward to answering any questions you might have. 

[The prepared statement of Ms. Milito follows:] 
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Mr. FRANKS. Thank you, Ms. Milito. 

And I now recognize our second witness, Mr. Peck. Please turn 

on your microphone, sir, before speaking. 

TESTIMONY OF ROBERT S. PECK, PRESIDENT, 

CENTER FOR CONSTITUTIONAL LITIGATION, PC 

Mr. PECK. Thank you, Mr. Chair. 

The 1983 rule was a failed experiment that caused some of the 

strongest judicial advocates of mandatory sanctions to reverse 

course and support its internment. Judge William Schwarzer, who 

also served as head of the Federal Judicial Center, originally supported the changes but later saw that it was used for tactical purposes, multiplied proceedings, caused waste and delay, and increased tensions between the parties. It made the job of judges 

harder. 

The Judicial Conference, which opposes this legislation, has told 

this Committee that the 1983 experiment spawned a cottage industry of tremendously wasteful satellite litigation that was all about 

strategic gamesmanship. It is a typical defense tactic to take a case 

away from the substance of the dispute, delay resolution, and outwait the patience and resources of the injured party who is desperate to be compensated for his or her injuries. 

The mandatory nature of the 1983 version encouraged this. The 

discretionary nature of the current rule caused much of that churning to evaporate. 

Many lawsuits have multiple counts. Success on any one of them 

is success. The 1983 version of Rule 11 had the perverse effect of 

causing post hoc review of the counts that did not succeed, resulting in sanctions against the prevailing parties. A discretionary approach to sanctions allows a judge to separate the wheat from the 

chaff and only sanction when warranted. 

Sometimes a novel but difficult cause of action fails, but helps illuminate the merits of a sister cause of action pleaded together. As 

I stated in my written testimony, both Brown v. Board of Education and National Federation of Independent Business v. Sebelius, 

the Obamacare challenge of 2012, would likely have faced Rule 11 

motions under the 1983 regime, but not under the current approach. 

The switch to the 1993 rule did not cause frivolous lawsuits to 

be filed. Judges have reported that little changed in filings, and, in 

fact, they may have improved. 

Truly frivolous cases are still sanctioned. Judges have the same 

authority that this bill would require of them, and the requirement 

of making it mandatory sort of indicates that judges, who really 

have very little patience for someone who wastes their time and 

are ready to invoke sanctions, are basically not trusted to act with 

the discretion that the current rule allows. They have that authority, and they can award attorneys’ fees and costs under the current 

regime. 

Sanctions are not always the best result. The distrust I mentioned is exacerbated by the distrust of the process set out by the 

Rule’s Enabling Act. Rather than allow the courts to determine 

how to govern their own proceedings, H.R. 758 would directly 

amend Rule 11, cutting the judiciary out of the process altogether. 
24 

It is not hard to imagine the protests that this body would make 

if the judiciary did the same as to how Congress conducted its own 

proceedings. 

Despite claims that civil rights cases, in particular, were not adversely affected once judges got the hang of the 1983 rule, the devastating impact on civil rights cases was palpable. The drop off 

could be explained by fewer cases, only the slam-dunks being filed, 

because of fear of sanctions. 

Even if advocates are right, that judges eventually are going to 

be less harsh on civil rights cases, we have a new generation of 

judges now who would go through the same growing pains that the 

1983 version had, thereby harming the constitutional right of access to the courts. 

The safe harbor language in H.R. 758 for civil rights in statuarybased claims does nothing to alleviate the problem. It merely repeats the same standard that applies to all cases, regardless of how 

the lawsuit is filed. 

I suggest that today’s Iqbal and Twombly standard for pleadings 

sufficiently protects against ill-considered lawsuits, making the 

comparisons between 1983 and 1993 academic. The plausibility 

standard basically supercharges the 1993 rule. 

I urge the Committee to reject this proposal, which seeks to return to what Professor Stephen Burbank accurately described as 

an irresponsible experiment with court access. Its enactment will 

only expose Americans to more harmful products and misconduct 

by diminishing the opportunity to hold those responsible accountable. 

We would not know about the ignition switch defect in GM vehicles that took lives if the 1983 rule, the rule that this bill would 

re-establish, was in effect, because the case was filed on a theory 

that there was a problem with the steering wheel. Compulsory discovery unearthed the ignition switch problem. 

In addition, this legislation would add to the cost of litigation, 

not lower it, as the vast number of cases affected will not be 

sanctionable. 

The double counting, wildly inaccurate figures this Committee 

received that purport to reflect the cost of the tort system instead 

reflect the cost to maintain the insurance system plus the money 

that goes into it. It does not provide helpful or relevant information. 

Judges and attorneys overwhelmingly, plaintiff and defense, support the rule as it is written today. I urge you not to alter it. 

[The prepared statement of Mr. Peck follows:] 
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Mr. FRANKS. Thank you, Mr. Peck. 

And I would now recognize our third and final witness, Mr. Silverman. 

And, sir, if you would make sure that microphone is on. 

TESTIMONY OF CARY SILVERMAN, PARTNER, 

SHOOK, HARDY & BACON LLP 

Mr. SILVERMAN. Good morning, Mr. Chairman, Ranking Member 

Cohen, and Members of the distinguished Subcommittee. Thank 

you for the opportunity to present testimony today on behalf of the 

U.S. Chamber’s Institute for Legal Reform. 

The civil justice system is established to provide a remedy to a 

person who was wrongfully injured, to make that person whole. 

But what happens when the system is misused to harm someone, 

when it is transformed from righting a wrong to inflicting one? 

This happens when a person files a lawsuit to harass or extort 

someone, ‘‘I’ll sue you.’’ It also happens when a lawyer takes a 

reckless or cavalier attitude, deciding to sue first and then research 

the law or investigate what actually occurred later. 

Now victims of frivolous lawsuits have no meaningful remedy. 

They are not made whole for the very real losses that they incur 

as a result of a wrongful act. It is a problem that stems from the 

Federal rules. 

The simple act of filing a short, plain statement of the claim, all 

that is needed to file a complaint, compels the person on the receiving end to respond. For an ordinary person or a small business, as 

Ms. Milito has shown, that means quickly hiring a lawyer and finding the money to pay the lawyer for his services. Lawyers are expensive. Dealing with the lawsuit means time away from work and 

lost income. It is stressful. 

Most of your constituents would be shocked to learn that, if they 

are hit with a lawsuit that has no basis whatsoever in law or fact, 

they have near zero chance of recovering a penny of their expenses, 

even if they can prove to a judge that the case was baseless or 

brought in bad faith, even if the case is certain to be thrown out. 

This is how Rule 11 works in practice. You can be the judge of 

its fairness. 

Let us say John Small is served with a $100,000 lawsuit by a 

tourist who claims that while visiting D.C. 2 years earlier, he 

tripped and fell in the 5th and N Street market. John has no recollection of this person or anyone else falling in his store. John now 

needs to hire an attorney to defend his family and his business 

from the lawsuit. The attorney quickly discovers that the plaintiff 

visited a store across town at 5th and N Northeast, not John’s store 

at 5th and N Northwest. 

Nevertheless, the plaintiff’s lawyer will not drop the claim. ‘‘Let 

the court sort it out,’’ he says. John’s attorney tells his client that 

he should be able to get the case dismissed. 

Best-case scenario, John is looking at about $12,000 in legal fees 

for the cost of the initial investigation, preparing an answer, preparing a motion to dismiss, and appearing at any status conferences and hearings. 
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The only way to seek recovery of his expenses is to file a motion 

for sanctions. This seems worthwhile to John until he learns three 

facts about Federal Rule 11. 

First, his attorney must draft a motion for sanctions, separate 

from the motion to dismiss, and share it with the plaintiff’s lawyer 

before he can file it. This is more lawyer time and money, maybe 

about $5,000. 

Once the plaintiff’s attorney receives the motion, he can then 

choose to withdraw the lawsuit. A judge will never see the motion. 

John will not have his day in court to ask for reimbursement. The 

plaintiff’s lawyer walks away without consequence. The motion and 

money spent goes in the trash. 

Second, even if the plaintiff’s attorney continues to pursue the 

lawsuit and the judge actually finds the case frivolous, the court 

may choose not to impose any sanction at all. 

Third, if the court does find a sanction appropriate, the rule prohibits the judge—we were talking about discretion here—the rule 

prohibits the judge from using sanctions for the purpose of reimbursing John’s legal expenses. The court could simply require the 

plaintiff’s lawyer to pay a small penalty to the court to deter future 

misconduct. That is what the rule says. 

The plaintiff’s lawyer has asked for $10,000 to make the case go 

away, an amount just under the cost of litigation. John’s attorney 

will give him three options. Option one, let us try to settle this case 

for $5,000 without incurring more costs for you, and you can move 

on with your life and your business. Option two, let us fight this 

lawsuit and be vindicated, but you will have to pay at least $12,000 

in unrecoverable legal fees to get it dismissed. Third, let us seek 

dismissal and sanctions. You will incur closer to $20,000 in legal 

fees but you will have a very small chance of recovering some of 

them. 

Individuals, business owners, and their insurers routinely face 

this choice. Most settle and cut their losses. Some fight for dismissal on principle. Very few seek sanctions today. 

What choice would your constituents make? 

LARA restores a remedy for victims of lawsuit abuse and ensures 

that judges have an opportunity to consider whether claims and defenses are frivolous. 

Thank you. 

[The prepared statement of Mr. Silverman follows:] 
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Mr. FRANKS. Thank you all for your testimony. We will now proceed under the 5-minute rule with questions, and I will begin by 

recognizing myself for 5 minutes. 

Ms. Milito, we hear anecdotal stories of small businesses being 

forced to settle lawsuits for $5,000 or $10,000, not because there 

is any merit to the plaintiff’s case, but because it is simply cheaper 

to settle than to defend against a lawsuit. 

In your experience, in addition to your testimony, can you elaborate? Does this occur? And if so, will the Lawsuit Abuse Reduction 

Act change this reality for at least some cases brought in or removed to Federal court? 

Ms. MILITO. Thank you for that question, Mr. Chairman, and 

yes, absolutely. 

The passage of the bill would benefit small-business owners in 

many ways, and I want to go back to actually your word in your 

opening statement about the deterrent effect of the bill, and that 

is really so important. The business owners whom I represent and 

speak with on a near daily basis don’t want to be in court, period. 

They don’t want to be threatened with a lawsuit, but they don’t 

want to be in court, period. 

And the simplicity of this bill is just that it is going to force attorneys, again both plaintiff attorneys and defense attorneys, to do 

their homework, and, as you said, before they file a paper in court, 

ensure that it is based on facts and law. 

I think it will really do a lot to deter these kinds of frivolous 

claims that might lead to a lawsuit, and deter attorneys from making these settlement demands, because of knowing that they can’t 

file a suit afterwards, a frivolous claim afterwards. So I think it 

will have a very big impact on small businesses. 

Mr. FRANKS. Thank you. 

Mr. Silverman, recently, a prominent consumer advocate, Ralph 

Nader, described the Lawsuit Abuse Reduction Act as, quote, 

‘‘evenhanded,’’ in that it would apply sanctions to both plaintiffs 

and defendants when they make frivolous claims or defenses. 

Can you help me understand why a gentleman with the perspective of Ralph Nader would describe this bill as, quote, ‘‘evenhanded’’? 

Mr. SILVERMAN. Well, Mr. Chairman, I think that even very 

knowledgeable people sometimes have the misconception that Rule 

11 only applies to frivolous claims brought by plaintiffs. But Rule 

11 is actually an extremely balanced rule. 

If you look at its text, it applies to victims of frivolous litigation 

on both sides. It applies to any pleading, written motion, or other 

paper, whether it is filed by a plaintiff or a defendant. And a plaintiff’s factual contentions must have evidentiary support, just as a 

defendant’s claims of denial of facts must be based on evidence. 

Claims and defenses must be warranted by existing law. 

Plaintiffs can’t file lawsuits to harass others, just as defendants 

cannot use delay tactics for purposes of litigation. That is all covered by Rule 11, and I think if you look at the case law between 

1983 and 1993, you will see many cases, many Rule 11 sanctions, 

brought against defendants, as well. 

Mr. FRANKS. Thank you, sir. Let me just follow up. 
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One of the concerns raised by mandatory sanctions is that they 

will potentially chill plaintiffs from being able to bring legitimate 

cases. Isn’t the bar fairly high, in terms of what the courts would 

consider a frivolous claim? I mean, a frivolous claim isn’t frivolous 

simply because the plaintiff loses. Can you elaborate on that? 

Mr. SILVERMAN. Thank you, Mr. Chairman. Yes, that is correct. 

Plaintiffs with legitimate claims really should have no concern 

about LARA. Rule 11 sets a very high standard for a violation. It 

is not simply losing on a motion to dismiss. There has to be either 

an improper purpose shown—harassment or delay. There has to be 

no basis in fact, or no basis even after a legitimate chance for discovery, and no basis in the law or a reasonable argument for a 

change in the law. 

And judges have significant discretion under the current rule and 

under LARA to decide whether those standards apply. Judges are 

lawyers, too, and they are very reluctant to impose sanctions on a 

party’s lawyer for not meeting these standards. They take a very 

hard look and take the responsibility very seriously. 

Mr. FRANKS. Well, thank you. And I will now yield 5 minutes to 

Mr. Cohen for questions. 

Mr. COHEN. Thank you, Mr. Chair. 

First, I asked each of you to consider telling me when there had 

been another instance where the Congress had initiated a law, a 

rule, without the courts requesting it. 

Ms. Milito, can you give me an example? 

Ms. MILITO. I cannot and I would be happy to—— 

Mr. COHEN. Mr. Silverman, can you give me an example? 

Mr. SILVERMAN. Well, Mr. Cohen, there are examples—— 

Mr. COHEN. What are they? 

Mr. SILVERMAN [continuing]. Of situations where Congress has 

intervened when they found that fee shifting is supported by public 

policy. And those are not in the rules themselves, but they are in 

the statutes. 

Mr. COHEN. The answer is no. The answer is no. You know of 

no rule that has been passed this way. 

Mr. SILVERMAN. No rule. 

Mr. COHEN. Mr. Peck? 

Mr. PECK. The only time that Congress has ever suggested any 

kind of procedural change is when it is intermingled with a new 

substantive cause of action. No general rules. 

Mr. COHEN. Thank you, sir. 

Ms. Milito, in your statement, you said, quote, unquote, 

‘‘Smalltime lawyers bring these cases.’’ As a self-practicing attorney, and I know lots of them, how do you define ‘‘smalltime lawyer’’? 

Ms. MILITO. I am talking about the lawyers that are printing out 

form complaints and maybe only changing the business name. 

Lawyers that are not doing their homework before they file a—— 

Mr. COHEN. I would submit to you, that is—I don’t know what 

you meant, but ‘‘smalltime lawyer’’ I find offensive to many lawyers 

who have small practices, who are smalltime businesspeople. They 

are small-business people and they work hard, and they work by 

the rules, and they bring cases, and they don’t boilerplate. I would 
61 

submit that you should try to find a better term than ‘‘smalltime 

lawyers.’’ 

Ms. MILITO. My intent was not to offend any attorneys. We, certainly, have many members at NFIB who are attorneys, and we 

have members at NFIB who—— 

Mr. COHEN. Thank you. Thank you very much. 

Ms. MILITO [continuing]. Practice plaintiff—— 

Mr. COHEN. Mr. Peck or anybody else here, are you all familiar 

with the examples that the Chair gave about an ironing board 

warning that you shouldn’t iron while clothes are on? And a fishing 

lure that you shouldn’t ingest it? Or a wheelbarrow shouldn’t be on 

the highway? Did the courts order that, because of a smalltime 

lawyer or some other lawyer that went into court and got some 

kind of a judgment? Or is that just a manufacturer being overboard? 

Mr. PECK. I am not aware of any case where liability was assessed for the failure to provide a warning of that nature. 

What we have found in studies that have been published in various law reviews is that often when these warnings appear, they 

are the result of in-house counsel making a suggestion to their 

company, saying, ‘‘Let’s use something like this so that there is no 

chance anyone can get it wrong.’’ This is, of course, over-lawyering. 

Mr. COHEN. Mr. Silverman, the American Bar Association and 

the Federal Judicial Conference both oppose LARA. Neither are 

known to be great apologists for trial lawyers or smalltime lawyers. 

In the 2005 Federal Judicial Center, more than 80 percent of 

judges who responded agreed that Rule 11 is just right in its current form. Only 5 percent favored the 1983 revision. 

Why should Congress not defer to the judgment of the judiciary? 

Mr. SILVERMAN. Mr. Cohen, Rule 11 is different, and LARA is 

different than other Federal rules. Unlike other rules that deal 

with changing the number of days for filing a complaint or an answer, how many interrogatories you can have, time limits, et 

cetera, it is not a purely procedural rule. This is a rule that deals 

with providing rights and remedies of people. It is something that 

Congress does—— 

Mr. COHEN. I know what Rule 11 is, but the courts are all 

against it. If the Judicial Conference is against it, and the Bar Association is against it, why should we go against the expert logic 

and come up with something that—— 

Mr. SILVERMAN. They weren’t against it when the rule was in effect. If you look back, there was a 1990 study where 95 percent of 

judges said, and this was a survey of all of the judges, and 75 percent actually responded. Ninety-five percent said it did not impede 

development of the law. Three-quarters said that the benefit in deterring frivolous lawsuits and compensating those who are harmed 

outweighed the use of judicial time to decide the motions. And 4 

out of 5 said it had a positive effect on litigation. 

Now, there are other studies, which others have cited here, and 

those are later. They are small—— 

Mr. COHEN. And the Judicial Conference 3 years later recommended a change. 

Mr. SILVERMAN. They did recommend the change—— 
62 

Mr. COHEN. But they don’t recommend a change now. But you 

are submitting we should go against the Judicial Conference now? 

Mr. SILVERMAN. The Judicial Conference knows a lot about the 

procedures, the mechanics of the courts, but this is an area that 

involves rights and remedies. And it is a good place—— 

Mr. COHEN. This is an area where we should forget the courts 

and appeal to the thoughts of the public that think all judges are 

bad, that all government is bad, and we should kill the judges. This 

is what you are saying, that we shouldn’t listen to the judges on 

this; we should listen to the public that says the judges are bad, 

the lawyers go first, and all that. 

Mr. SILVERMAN. That is—that is—— 

Mr. FRANKS. Mr. Silverman, you didn’t say anything about killing the judges, did you? 

Mr. SILVERMAN. I certainly did not. 

Mr. FRANKS. I just wanted to—— 

Mr. COHEN. Shakespeare did that. 

Mr. SILVERMAN. In fact, I would like more discretion than they 

have today to look at these cases. 

Mr. COHEN. Ms. Milito, small business said this is a very minor 

problem they have. They rated it, in surveys, the lower three or 

four out of 75 problems that they had with business. Cost and frequency of lawsuits, threatened lawsuits, was 71st out of a possible 

75 in a survey taken in 2012 by the NFIB. 

Why is it such an important issue when it is 71st out of 75? 

Ms. MILITO. I am going to start off with a quote Mr. Silverman 

used in his testimony. Judge Learned Hand said, ‘‘I should dread 

a lawsuit beyond almost anything short of sickness and death.’’ If 

today you were told you had a terminal illness, I bet it would become your number one problem and priority. And as with a lawsuit, most of the members I speak with don’t even think of it until 

it is staring them in the face. 

Mr. COHEN. Well, Ms. Milito, I don’t have cancer right now, but 

I am concerned about it, and I am frightened of it and the prospect 

in the future of all the illness. And I think if it was a major thing 

for small business because it could happen, it would rank higher 

than 71st out of 75th. 

And I yield back the balance of my time. 

Mr. FRANKS. And I thank the gentleman. 

I now recognize Mr. Nadler, the gentleman from New York, for 

5 minutes. 

Mr. NADLER. I thank you. 

Mr. Peck, one of the points against LARA is that it makes 

sanctionable, arguably, the use of novel legal theories, which could 

be considered frivolous, and that implicates, in particular, civil 

rights lawsuits. The Committee report from last Congress cited the 

case Nicole ‘‘Nikki’’ Youngblood, who, ‘‘filed suit after her picture 

was left out of the school yearbook when she refused to wear a 

feminine drape instead of a shirt and tie as she wished,’’ as an example of a frivolous claim. 

To date, there are 14 States with laws that address discrimination against students based on gender identity. While the majority 

clearly considered Nikki to be an example of a frivolous lawsuit, 

might this be an example of a valid civil rights claim worthy of ju-
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dicial consideration? Doesn’t this highlight the potential chilling effect on civil rights claims? And by the same token, might the claim 

in Loving v. Virginia on mixed-race marriages or, in fact, when the 

same-sex marriage case brought before the Supreme Court, I forget 

how many decades ago, was dismissed as absurd. And now the Supreme Court has ruled differently. 

Might all of these things be barred and sanctionable under 

LARA, under this bill? 

Mr. PECK. It is entirely possible that they would be. We often get 

fractured versions of the facts that underlie cases when they are 

used as examples like this. But let me give you two examples from 

my own experiences, two cases that I am currently working on. 

In one, I am representing the City of Miami in a Fair Housing 

Act case that it brought against various banks. Los Angeles has 

also brought similar cases. In Los Angeles, the cases are in Federal 

Court. The ruling was against the motion to dismiss and the cases 

are going to trial. In Miami, the judge found a precedent that not 

even the banks had cited and said that there is no basis for the 

city to have standing here and that this was a frivolous argument. 

If this rule was in effect, the City of Miami would have been 

sanctioned for bringing this suit, which is approved by a U.S. Supreme Court case, which upheld the standing of municipalities to 

bring these kinds of lawsuits. We are now in the 11th Circuit on 

that case. 

A second case that I want to bring up, on Saturday, I received 

a petition for certiorari. Actually, it was two petitions for certiorari 

filed by Walmart out of a Pennsylvania case. These are cases in 

which Walmart lost wage and hour class actions, but they are not 

sure whether they are supposed to be appealing from the Pennsylvania Supreme Court’s decision or the Pennsylvania Superior 

Court, so they filed two petitions for certiorari and asked the court 

to sort out what they should do, in an abundance of caution. 

If LARA were in effect, it would seem mandatory that one of 

those petitions was frivolous. 

Mr. NADLER. Thank you. Let me just ask, before I switch to a 

different topic, such lawsuits as Citizens United v. Federal Election 

Commission, the District of Columbia v. Heller on the Second 

Amendment, Commonwealth of Virginia v. Sebelius that went to 

the Supreme Court on the Affordable Care Act, could not all these 

cases have been considered frivolous and sanctionable, given the 

novel legal theories underlying them? All these cases, of course— 

well, go ahead. 

Mr. PECK. Yes. And you know, in each of those instances, people 

made claims that the theory behind them was ridiculous, was frivolous. And as a result, even in the Obamacare case, you had law 

professors urging the government to seek sanctions. 

If this mandatory rule were in effect, they would seek sanctions, 

and we would have seen hearings on the sanctions rather than—— 

Mr. NADLER. Okay, thank you. And talking about hearings on 

the sanctions, during the decade that the 1983 version of Rule 11 

was in effect, which this bill would seek to reinstate, at least a 

quarter of all cases of the Federal civil docket were burdened by 

Rule 11 proceedings that did not result in sanctions. Almost every 

case had two cases, a sanctions case as well as the underlying case. 
64 

Based on our experience with the 1983 version of the rule, and 

for that matter with the 1993 revision, do you think that this bill, 

if enacted, God forbid, would lead to a lot more rather than less 

litigation? 

Mr. PECK. It is not only my judgment but it is the judgment of 

the Judicial Conference. 

Mr. NADLER. So the Judicial Conference judged that this would 

be increasing litigation, increasing court costs for all involved. 

Let me ask Mr. Silverman, on what basis are they wrong? And 

how are we making the whole system cheaper by increasing litigation, so that every lawsuit, a large majority of lawsuits, have Rule 

11 hearings and litigation appended to them? 

Mr. SILVERMAN. Mr. Nadler, thank you. It is a pleasure to be before you today as Brooklyn native, so I want to thank you for your 

service. 

Satellite litigation, there was a lot of concern about that. I understand those concerns. And some of it—— 

Mr. NADLER. There was a reality to it, not just a concern. 

Mr. SILVERMAN. Some of it stemmed from the change in the rule 

in 1983. It was very different before that. 

But there are a couple of factors I would ask you to consider. 

First, I think we have to look at why is a Rule 11 motion different 

from other types of motions that the courts decide every day. If you 

look at any Federal court docket, there are going to be motions for 

summary judgment, for dismissal, for expert testimony, issues for 

venue, jurisdiction, what have you. 

Judges decide those motions in the routine course of business, 

and if they find that it lacks merit, as with a Rule 11 motion, all 

they have to say is one word, ‘‘denied,’’ and they move on with it. 

I think we also should consider the alternatives to allowing the 

motion, which is a system where a person who believes they were 

harmed by a frivolous lawsuit or defense has no way of bringing 

that before the judge. 

In terms of the satellite litigation issue and the numbers I have 

seen, I know in Mr. Peck’s testimony and I have seen it cited in 

other places, that there were something like 7,000 sanctions motions in the period where the stronger rule was in effect. But you 

have to look at that in context. That was over a 10-year period. 

There were almost 700 Federal judges. 

Mr. NADLER. My time has expired. I want to say one sentence 

in response to what you said, and that is the reason it is different 

is that a motion to dismiss or motion for summary judgment is on 

the same underlying questions, whereas a Rule 11 proceeding is an 

entirely different question than the underlying questions. So it is 

a whole different fact consideration. 

I yield back. Thank you. 

Mr. FRANKS. And I would, certainly, defer to the gentleman’s expertise in novel legal theories. 

And I would now recognize gentleman from Florida, Mr. Deutch, 

for 5 minutes. 

Mr. DEUTCH. Thank you, Mr. Chairman. 

Mr. Peck, can we just back up for a second? When the Rules Advisory Committee amended Rule 11 in 1993, it gave courts discre-
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tion to impose sanctions, and noted that the purpose of the sanctions was to deter bad conduct, not to reward the other party. 

Why did the Rules Advisory Committee give courts this discretion, which this bill would take away? And why was the purpose 

deterrence rather than compensation? 

Mr. PECK. Well, first of all, the courts do not want frivolous filings, and so that is the reason for the deterrence factor. And what 

the Committee did was say, here the filing of these motions are 

something that we will determine but not every motion and every 

filing is necessarily of the same nature. They don’t have the same 

qualities to it. They may be better remedied by instruction to the 

jury that they are allowed to infer something because of this filing. 

And that often can be more devastating to a case than not. So 

there is flexibility because different sanctions are appropriate for 

different types of filings. 

But second of all, the courts retain inherit power to shift costs, 

if they want to. So it didn’t have to be in the rules, and courts continue to use that power. 

Mr. DEUTCH. And then looking ahead, Mr. Silverman, you had 

cited a survey to support the 1983 version, a survey from 1991. But 

obviously, at this point, we acknowledge that the Judicial Conference opposes restoring mandatory Rule 11 sanctions. 

Federal judges overwhelmingly support Rule 11 as it currently 

exists. Your study is from 1991, which you use to show that the 

old system worked. But in 2005, the Judicial Center issued a report 

entitled, ‘‘Report of a Survey of U.S. District Judges’ Experiences 

and Views Concerning Rule 11.’’ More than 80 percent of the 

judges said that Rule 11 is needed as is, is just right, and is just 

right as it now stands. Eighty-seven percent of the judges who responded preferred the current version of Rule 11. And just 5 percent preferred the version of Rule 11 that existed between 1983 

and 1993. And only 4 percent preferred the version of Rule 11 as 

proposed in the Lawsuit Abuse Reduction Act. 

Ninety-one percent opposed the requirement that sanctions be 

imposed for every Rule 11 violation. And 84 percent disagreed with 

the proposition that an award of attorney’s fees should be mandatory for every violation. Eighty-five percent believe that the amount 

of groundless civil litigation has not grown since the promulgation 

of the 1993 rule. 

Before getting to the question, Mr. Chairman, I ask for unanimous consent to submit the 2005 Federal Judicial Center report in 

the record. 

Mr. FRANKS. Without objection. 

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Mr. DEUTCH. I appreciate that. 

So other than your statement before that this is something you 

would like Congress to address, why should we consider the 1991 

results relevant when in 2005, with a lot of experience, the judges 

who actually deal with Rule 11 have determined that it works the 

way it is now? 

Mr. SILVERMAN. I appreciate your question. I think it is important to look at the 1991 survey, not just because it was the most 

extensive of the surveys that had been conducted, but because 

these were judges who actually had several years’ experience with 

the former rule. 

The 2005 survey, half of the judges that were included never actually were—they were appointed after the new rule, the current 

rule, was in effect. So they never saw how the rule—— 

Mr. DEUTCH. They didn’t know. The overwhelming majority of 

judges, 87 percent who prefer the current version, since some of 

them had only become judges since the rule changed, their opinions 

don’t matter on this? 

Mr. SILVERMAN. Actually, there are two areas where I think all 

of the surveys are consistent. I think they are consistent even if 

you look at the 2005 and the 1995 and the older one I cited, all 

the judges say that a compensatory function, compensatory—— 

Mr. DEUTCH. Mr. Silverman, I am sorry. I am running out of 

time. 

But I just want to be clear. I am not looking for consistency in 

the surveys. I am trying to understand why we should discard the 

overwhelming support for the system the way it is now, moving forward. 

But let me just finish with Mr. Peck. 

Mr. Peck, you had raised some concerns about what this change 

would do to civil rights cases and you mentioned Brown v. Board 

of Education. Could you elaborate a bit on how that case, in particular, might have been impacted if this change had been in place 

then? 

Mr. PECK. As you know, the issue was whether separate was not 

really equal. And the evidence that was produced in the case 

showed that the Topeka, Kansas, schools were actually substantially equal, in facility, in quality of teachers, in the curriculum, in 

what they provided to both Black and White children. Robert 

Carter, who served as a Federal district court judge in New York 

for many years, was part of that litigation team. 

It was his judgment that if the 1983 version of it was in effect, 

Brown would have received sanctions. They would have been fearful of bringing the case and may have waited another 10 years before it happened. 

Mr. DEUTCH. Right. 

And, Mr. Chairman, this country would look very different than 

it does today. I thank you, and I yield back. 

Mr. FRANKS. I thank the gentleman. 

And I thank all of you. And this would conclude today’s hearing. 

Without objection, all Members will have 5 legislative days to 

submit additional written materials and written questions for the 

witnesses, or additional materials for the record. 
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We would again thank the witnesses and the Members and the 

audience. 

With that, this hearing is adjourned. 

[Whereupon, at 11:02 a.m., the hearing was adjourned.] 

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Response to Questions for the Record from Robert S. Peck, President, 

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