```

[Congressional Record Volume 141, Number 71 (Tuesday, May 2, 1995)]
[Senate]
[Pages S6011-S6013]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

                          AMENDMENTS SUBMITTED

                                 ______

   THE COMMON SENSE LEGAL STANDARDS REFORM ACT OF 1995 COMMON SENSE 
                  PRODUCT LIABILITY REFORM ACT OF 1995

                                 ______

                  DOLE (AND OTHERS) AMENDMENT NO. 617

  Mr. DOLE (for himself, Mr. Exon, Mr. Hatch, Ms. Snowe, Mr. McConnell, 
Mr. Abraham, Mr. Kyl, Mr. Thomas, Mrs. Hutchison, Mr. Gramm) proposed 
an amendment to amendment No. 596 proposed by Mr. Gorton to the bill 
(H.R. 956) to establish legal standards and procedures for product 
liability litigation, and for other purposes; as follows:

       On page 19, strike line 12 through line 5 on page 21, and 
     insert the following:

      SEC. 107. PUNITIVE DAMAGES IN CIVIL ACTIONS.

       (a) Findings.--The Congress finds that--
       (1) punitive damages are imposed pursuant to vague, 
     subjective, and often retrospective standards of liability, 
     and these standards vary from State to State;
       (2) the magnitude and unpredictability of punitive damage 
     awards in civil actions have increased dramatically over the 
     last 40 years, unreasonably inflating the cost of settling 
     litigation, and discouraging socially useful and productive 
     activity;
       (3) excessive, arbitrary, and unpredictable punitive damage 
     awards impair and burden commerce, imposing unreasonable and 
     unjustified costs on consumers, taxpayers, governmental 
     entities, large and small businesses, volunteer 
     organizations, and nonprofit entities;
       (4) products and services originating in a State with 
     reasonable punitive damage provisions are still subject to 
     excessive punitive damage awards because claimants have an 
     economic incentive to bring suit in States in which punitive 
     damage awards are arbitrary and inadequately controlled;
       (5) because of the national scope of the problems created 
     by excessive, arbitrary, and unpredictable punitive damage 
     awards, it is not possible for the several States to enact 
     laws that fully and effectively respond to the national 
     economic and constitutional problems created by punitive 
     damages; and
       (6) the Supreme Court of the United States has recognized 
     that punitive damages can produce grossly excessive, wholly 
     unreasonable, and often arbitrary punishment, and therefore 
     raise serious constitutional due process concerns.
       (b) General Rule.--Notwithstanding any other provision of 
     this Act, in any civil action whose subject matter affects 
     commerce brought in any Federal or State court on any theory, 
     punitive damages may, to the extent permitted by applicable 
     State law, be awarded against a defendant only if the 
     claimant establishes by clear and convincing evidence that 
     the harm that is the subject of the action was the result of 
     conduct by the defendant that was either--
       (1) specifically intended to cause harm; or
       (2) carried out with conscious, flagrant disregard to the 
     rights or safety of others.
       (c) Proportional Awards.--The amount of punitive damages 
     that may be awarded to a claimant in any civil action subject 
     to this section shall not exceed 2 times the sum of--
       (1) the amount awarded to the claimant for economic loss; 
     and
       (2) the amount awarded to the claimant for noneconomic 
     loss.
     This subsection shall be applied by the court and the 
     application of this subsection shall not be disclosed to the 
     jury.
       (d) Bifurcation.--At the request of any party, the trier of 
     fact shall consider in a separate proceeding whether punitive 
     damages are to be awarded and the amount of such an award. If 
     a separate proceeding is requested--
       (1) evidence relevant only to the claim of punitive 
     damages, as determined by applicable State law, shall be 
     inadmissible in any proceeding to determine whether 
     compensatory damages are to be awarded; and
       (2) evidence admissible in the punitive damages proceeding 
     may include evidence of the defendant's profits, if any, from 
     its alleged wrongdoing.
       (e) Applicability.--Nothing in this section shall be 
     construed to--
       (1) waive or affect any defense of sovereign immunity 
     asserted by the United States, or by any State, under any 
     law;
       (2) create any cause of action or any right to punitive 
     damages;
       (3) supersede or alter any Federal law;
       (4) preempt, supersede, or alter any State law to the 
     extent that such law would further limit the availability or 
     amount of punitive damages;
       (5) affect the applicability of any provision of chapter 97 
     of title 28, United States Code;
       (6) preempt State choice-of-law rules with respect to 
     claims brought by a foreign nation or a citizen of a foreign 
     nation; or
       (7) affect the right of any court to transfer venue or to 
     apply the law of a foreign nation or to dismiss a claim of a 
     foreign nation or of a citizen of a foreign nation on the 
     ground of inconvenient forum.
       (f) Federal Cause of Action Precluded.--Nothing in this 
     section shall confer jurisdiction on the Federal district 
     courts of the United States under section 1331 or 1337 of 
     title 28, United States Code, over any civil action covered 
     under this section.
       (g) Definitions.--For purposes of this section:
       (1) The term ``claimant'' means any person who brings a 
     civil action and any person on whose behalf such an action is 
     brought. If such action is brought through or on behalf of an 
     estate, the term includes the decedent. If such action is 
     brought through or on behalf of a minor or incompetent, the 
     term includes the legal guardian of the minor or incompetent.
       (2) The term ``clear and convincing evidence'' means that 
     measure or degree of proof that will produce in the mind of 
     the trier of fact a firm belief or conviction as to the truth 
     of the allegations sought to be established. The level of 
     proof required to satisfy such standard shall be more than 
     that required under preponderance of the evidence, and less 
     than that required for proof beyond a reasonable doubt.
       (3) The term ``commerce'' means commerce between or among 
     the several States, or with foreign nations.
       (4)(A) The term ``economic loss'' means any objectively 
     verifiable monetary losses resulting from the harm suffered, 
     including past and future medical expenses, loss of past and 
     future earnings, burial costs, 
     [[Page S6012]]  costs of repair or replacement, costs of 
     replacement services in the home, including child care, 
     transportation, food preparation, and household care, costs 
     of making reasonable accommodations to a personal residence, 
     loss of employment, and loss of business or employment 
     opportunities, to the extent recovery for such losses is 
     allowed under applicable State law.
       (B) The term ``economic loss'' shall not include 
     noneconomic loss.
       (5) The term ``harm'' means any legally cognizable wrong or 
     injury for which damages may be imposed.
       (6)(A) The term ``noneconomic loss'' means subjective, 
     nonmonetary loss resulting from harm, including pain, 
     suffering, inconvenience, mental suffering, emotional 
     distress, loss of society and companionship, loss of 
     consortium, injury to reputation, and humiliation.
       (B) The term ``noneconomic loss'' shall not include 
     economic loss or punitive damages.
       (7) The term ``punitive damages'' means damages awarded 
     against any person or entity to punish such person or entity 
     or to deter such person or entity, or others, from engaging 
     in similar behavior in the future.
       (8) The term ``State'' means any State of the United 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, the Northern Mariana Islands, the Virgin Islands, Guam, 
     American Samoa, and any other territory or possession of the 
     United States, or any political subdivision of any of the 
     foregoing.
       (h) Effective Date.--This section shall apply to any civil 
     action in which trial has not commenced before the date of 
     enactment of this Act.

                                 ______

                 THOMPSON (AND OTHERS) AMENDMENT NO 618

  (Ordered to lie on the table.)
  Mr. THOMPSON (for himself, Mr. Cochran, and Mr. Simon) submitted an 
amendment intended to be proposed by them to amendment No. 596 proposed 
by Mr. Gorton to the bill H.R. 956, supra; as follows:

       In section 102(a)(1), after ``commenced'' insert the 
     following: ``in a Federal court pursuant to section 1332 of 
     title 28, United States Code, or removed to a Federal court 
     pursuant to chapter 89 of such title''.
       In section 102(c)(6), strike ``or'' at the end.
       In section 102(c)(7), strike the period at the end and 
     insert ``; or''.
       In section 102(c), add the following new paragraph:
       (8) create a cause of action or provide for jurisdiction by 
     a Federal Court under section 1331 or 1337 of title 28, 
     United States Code, that otherwise would not exist under 
     applicable Federal or State law.

 Mr. THOMPSON. Mr. President, I submit on behalf of myself and 
Senators Cochran and Simon an amendment that would limit applicability 
of the product liability to cases in federal court.
  As currently before the Senate, H.R. 956 would seriously jeopardize 
the balance between state and federal governments that the Founding 
Fathers established in the Constitution. States have had responsibility 
for developing their own rules of tort law--free of federal 
interference--for more than 200 years. In an unprecedented fashion, the 
product liability bill would displace state law governing an area 
always reserved to the states, even when the case is brought in state 
court. I am troubled by a Washington knows best approach to product 
liability.
  Even worse, the displacement of state law is selective. H.R. 956 
prevents states from providing less protection to defendants, but not 
from providing more. This one-size-fits-all bill overlooks both that 
individual Americans are unique and that states have their own right to 
determine the law that should apply to their special situations.
  The bill raises federalism problems in a very practical sense. 
Because state law would still govern many aspects of product liability 
law under H.R. 956, there would be numerous questions to litigate 
concerning the relationship between the federal law and existing state 
laws. New, different, and inconsistent interpretations of the federal 
law and the state laws would result. Under the bill, resolution of 
these issues would be provided from a federal court of appeals. Those 
courts, not state courts, would ultimately determine the scope and 
meaning of state law as it interacts with this bill. Moreover, those 
appeals courts would be deluged with litigation at a time when years 
elapse before trial of a civil case in federal court, and when 
Americans rightly demand that federal courts apply swift and certain 
justice in criminal cases.
  By contrast, my amendment recognizes that interstate commerce is the 
justification for a federal product liability bill. It is interstate 
commerce that justifies federal court jurisdiction in cases brought by 
citizens of one state against citizens of another. I believe that the 
rationale of the bill corresponds precisely with the reasons underlying 
federal diversity jurisdiction.
  Despite the claims made, no one truly knows the effect of this bill 
on the ability of injured Americans to recover adequate compensation 
for injuries caused by defective products. Nor will anyone know whether 
competitiveness of American business will be enhanced or whether 
insurance premiums will fall if H.R. 956 is enacted. At the same time, 
the bill would displace 200 years of law based on actual experience. If 
the bill failed to achieve its objectives, there would be almost no 
means of unscrambling the federalized egg. By contrast, applying the 
bill only to federal court cases would provide an opportunity to 
experiment. If H.R. 956's ideas work, states can adopt these rules as 
their own. Potentially, a preemptive approach might then make sense. 
But if the bill created numerous practical problems, well-tested state 
law would remain undisturbed while Congress acted to fix the problems 
in the federal law.
  The practical effect of my amendment would be that defendants sued 
out of state in many instances would be able to remove their cases to 
federal court and obtain the federal rule. Defendants sued in their 
home state would not be able to remove the case to federal court. Thus, 
those defendants would be governed by their own state law as applied by 
their own state court. I believe this is to be a much more sensible 
approach than the one now before the Senate, and one consistent with 
the federal system the Constitution created.
                                 ______

                        DORGAN AMENDMENT NO. 619

  Mr. DORGAN proposed an amendment to amendment No. 617 proposed by Mr. 
Dole to amendment No. 596 proposed by Mr. Gorton to the bill, H.R. 965, 
supra; as follows:

       On page 1, beginning with line 3, strike through line 2 on 
     page 8 and insert the following:

     SEC. 107. UNIFORM STANDARDS FOR AWARD OF PUNITIVE DAMAGES.

       ``(a) General Rule.--Punitive damages may, to the extent 
     permitted by applicable State law, be awarded against a 
     defendant in a product liability action that is subject to 
     this title if the claimant establishes by clear and 
     convincing evidence that the harm that is the subject of the 
     action was the result of conduct that was carried out by the 
     defendant with a conscious, flagrant indifference to the 
     safety of others.
       ``(b) Bifurcation at Request of Either Party.--At the 
     request of either party, the trier of fact in a product 
     liability action that is subject to this title shall consider 
     in a separate proceeding whether punitive damages are to be 
     awarded for the harm that is the subject of the action and 
     the amount of the award.''
                                 ______

                        SNOWE AMENDMENT NO. 620

  Mr. GORTON (for Ms. Snowe) proposed an amendment to amendment No. 596 
proposed by Mr. Gorton to the bill, H.R. 956, supra; as follows:

       On page 19 strike line 22 through page 20 line 4 and insert 
     the following new subsection:
       (b) Limitation on Amount.--
       (1) In general.--The amount of punitive damages that may be 
     awarded to a claimant in a product liability action that is 
     subject to this title shall not exceed 2 times the sum of--
       (A) the amount awarded to the claimant for economic loss; 
     and
       (B) the amount awarded to the claimant for noneconomic 
     loss.
       (2) Application by court.--This subsection shall be applied 
     by the court and the application of this subsection shall not 
     be disclosed to the jury.
                                 ______

                 SHELBY (AND HEFLIN) AMENDMENT NO. 621

  Mr. SHELBY (for himself and Mr. Heflin) proposed an amendment to 
amendment No. 617 proposed by Mr. Dole to amendment No. 596 proposed by 
Mr. Gorton to the bill, H.R. 956, supra; as follows:

       At the appropriate place insert the following:

     SEC.  . LIABILITY FOR CERTAIN CLAIMS RELATING TO DEATH.

       In any civil action in which the alleged harm to the 
     claimant is death and the applicable State law provides, or 
     has been construed to provide, for damages only punitive in 
     nature, a defendant may be liable for any such damages 
     regardless of whether a claim is asserted under this section. 
     The recovery 
     [[Page S6013]]  of any such damages shall not bar a claim 
     under this section.
                                 ______

                 DEWINE (AND ABRAHAM) AMENDMENT NO. 622

  Mr. DeWINE (for himself and Mr. Abraham) proposed an amendment to 
amendment No. 617 proposed by Mr. Dole to amendment No. 596 proposed by 
Mr. Gorton to the bill H.R. 956, supra; as follows:

       On page 3 line 23, strike ``loss: and insert in lieu 
     thereof: ``loss;

     except that if the award is against an individual whose net 
     worth does not exceed $500,000 or against an owner of an 
     unincorporated business, or any partnership, corporation, 
     association, unit of local government or organization which 
     has fewer than twenty-five full-time employees, that amount 
     shall not exceed $250,000.''
                                 ______

                        DEWINE AMENDMENT NO. 623

  Mr. DeWINE proposed an amendment to amendment no. 617 proposed by Mr. 
Dole to amendment no. 596 proposed by Mr. Gorton to the bill, H.R. 965, 
supra; as follows:

       On page 4 line 11 strike the semicolon after the word 
     ``awarded'' through line 15 and insert a period.
     

                          ____________________
```