S6370 CONGRESSIONAL RECORD — SENATE May 10, 1995

I think it can easily be amended, and

the two Senators from Alabama will

want to give the Alabama Legislature

sufficient time to consider that amendment. I think that is appropriate, and I

believe that we can now accept the

Shelby-Heflin amendment by voice

vote. Assuming that we do so, Mr.

President, there will only be one vote

at 9:45.

The PRESIDING OFFICER. The

question is on agreeing to the amendment, as further modified.

So the amendment (No. 693), as further modified, was agreed to.

Mr. GORTON. Mr. President, I move

to reconsider the vote.

Mr. SHELBY. I move to lay that motion on the table.

The motion to lay on the table was

agreed to.

Mr. HEFLIN. Mr. President, I have

reservations about this in regard to

what has occurred, but I am faced with

reality, the reality of votes, and the reality of conference.

Senator SHELBY and I, therefore, are

approaching this issue from a pragmatic, not philosophical, viewpoint. I

just want to make that clear.

Mr. SHELBY. Mr. President, regarding the amendment we have worked

out and that has been voted on, I agree

with the senior Senator from Alabama.

We can both count. We were counting

votes and we were looking reality in

the face.

Our State of Alabama is unique

among the 50 States in that, as I have

said before on the floor, we have had a

wrongful death statute that assesses

punitive damages only where someone

is killed and there is a civil action because of the death. Most States in the

Union—I guess all of them except Alabama—have compensatory damages.

If I had my ‘‘druthers,’’ I would leave

this like it was or like it is today, but

this will give the Alabama Legislature

until September 12, 1996, to consider

changing it, if this proposed legislation

were to become law.

Mr. President, I suggest the absence

of a quorum.

The PRESIDING OFFICER. The

clerk will call the roll.

The assistant legislative clerk proceeded to call the roll.

Mr. GORTON. Mr. President, I ask

unanimous consent that the order for

the quorum call be rescinded.

The PRESIDING OFFICER. Without

objection, it is so ordered.

VOTE ON MOTION TO TABLE AMENDMENT NO. 749

The PRESIDING OFFICER. Under

the previous order, the question occurs

on amendment No. 749, offered by the

Senator from Iowa [Mr. HARKIN].

Mr. GORTON. I move to table the

Harkin amendment, and I ask for the

yeas and nays

The PRESIDING OFFICER. Is there a

sufficient second?

There is a sufficient second.

The yeas and nays were ordered.

The PRESIDING OFFICER. The

question is on agreeing to the motion

to table.

The yeas and nays have been ordered.

The clerk will call the roll.

The assistant legislative clerk called

the roll.

Mr. LOTT. I announce that the Senator from Virginia [Mr. WARNER] is

necessarily absent.

Mr. FORD. I announce that the Senator from Connecticut [Mr. LIEBERMAN]

is absent because of death in the family.

The PRESIDING OFFICER (Mr.

BURNS). Are there any other Senators

in the Chamber desiring to vote?

The result was announced—yeas 78,

nays 20, as follows:

[Rollcall Vote No. 159 Leg.]

YEAS—78

Abraham

Ashcroft

Bennett

Biden

Bingaman

Bond

Bradley

Breaux

Brown

Bryan

Burns

Campbell

Chafee

Coats

Cochran

Cohen

Coverdell

Craig

D’Amato

DeWine

Dodd

Dole

Domenici

Exon

Faircloth

Feingold

Feinstein

Ford

Frist

Glenn

Gorton

Graham

Gramm

Grams

Grassley

Gregg

Hatfield

Heflin

Helms

Hutchison

Inhofe

Jeffords

Johnston

Kassebaum

Kempthorne

Kerrey

Kerry

Kohl

Kyl

Lautenberg

Lott

Lugar

Mack

McCain

McConnell

Moseley-Braun

Moynihan

Murkowski

Murray

Nickles

Nunn

Packwood

Pell

Pressler

Pryor

Robb

Rockefeller

Roth

Santorum

Simon

Simpson

Smith

Snowe

Specter

Stevens

Thomas

Thompson

Thurmond

NAYS—20

Akaka

Baucus

Boxer

Bumpers

Byrd

Conrad

Daschle

Dorgan

Harkin

Hatch

Hollings

Inouye

Kennedy

Leahy

Levin

Mikulski

Reid

Sarbanes

Shelby

Wellstone

NOT VOTING—2

Lieberman Warner

So the motion to lay on the table the

amendment (No. 749) was agreed to.

Mr. GORTON. Mr. President, I move

to reconsider the vote.

Mr. ROCKEFELLER. I move to lay

that motion on the table.

The motion to lay on the table was

agreed to.

(Later the following occurred.)

CHANGE OF VOTE

fMr. PACKWOOD. Mr. President, on

rollcall vote 159 I voted ‘‘no.’’ It was

my intention to vote ‘‘yea.’’ I ask

unanimous consent I be permitted to

change my vote. This will in no way

change the outcome of the vote.

The PRESIDING OFFICER. Without

objection, it is so ordered.

(The foregoing tally has been

changed to reflect the above order.)

Mr. DORGAN addressed the Chair.

The PRESIDING OFFICER. The Senator from North Dakota.

AMENDMENT NO. 629 TO AMENDMENT NO. 690, AS

AMENDED

(Purpose: To eliminate caps on punitive

damage awards)

Mr. DORGAN. Mr. President, I would

like to offer amendment No. 629. The

amendment is at the desk.

The PRESIDING OFFICER. The

clerk will report.

The legislative clerk read as follows:

The Senator from North Dakota [Mr. DORGAN] proposes an amendment numbered 629

to amendment No. 690, as amended:

The amendment is as follows:

Insert at the appropriate place: ‘‘Notwithstanding any other provision of this Act,

nothing in this Act shall impose limitations

on punitive damage awards.’’

Mr. DORGAN. Mr. President, the

amendment which I have offered is not

identical but nearly identical to the

amendment I offered prior to cloture.

The amendment deals with the punitive damage cap. The amendment I offered previously I offered to the Dole

substitute. I now offer this amendment

to the underlying bill.

Very simply, my amendment would

remove the cap on punitive damages

that exists in the bill. The amendment

that I offered previously was defeated

by a vote of 51 to 49. I would like for

the Senate to express itself on that

issue in light of the activities on this

legislation since the Senate voted on

it. While I think there is merit in a

product liability reform bill and while

I think there is merit on both sides of

this issue, I believe the legislation

should be like the legislation on product liability we considered last year.

That legislation came to the floor of

the Senate and was voted on with respect to the last cloture vote without

any cap on punitive damages.

Last year, the bill that originated in

the Commerce Committee and brought

to the floor, did not include a cap on

punitive damages. This year, the legislation, as it emerged in the Commerce

Committee by the same authors, included a cap on punitive damages. I believe they were right last year and

wrong this year on that particular section of the bill.

I believe some reform necessary in

this area, but I believe their best impulses and best instincts last year

served them better than this year when

they decided to impose an arbitrary

cap on punitive damages.

After all, the legislation requires you

to provide clear and convincing evidence as a burden of proof that the

harm caused was carried out with a—

let me quote this—‘‘conscious and flagrant indifference to the safety of others.’’ If a plaintiff has gone through

trial and provided clear and convincing

evidence that harm was caused or carried out with a conscious and flagrant

indifference to the safety of others,

then I do not understand why someone

would suggest we ought to have a cap

on punitive damages.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6371

The legislation that is before us contains a cap on punitive damages in several different steps. It is, as I understand it, two times compensatory damages to a maximum of $250,000, a distinction from that particular cap for

small businesses, certain designated

small businesses in the bill, and, third,

a provision that a judge could increase

the punitive damage award upon a petition by the plaintiff. That is my understanding of what is in the legislation

that is before the Senate. My amendment says, notwithstanding any other

provision of this act, nothing in this

act shall impose limitations on punitive damage awards.

Again and finally, let me say that

this is the same position Senator

ROCKEFELLER and Senator GORTON had

last year, no cap on punitive damages.

And I think it is appropriate. The reason I think it is appropriate is we have

changed the bar that you must get over

in order to prove punitive damages. It

requires clear and convincing evidence

that the harm caused was carried out

with conscious and flagrant indifference to the safety of others.

I just do not understand how, if you

meet that burden of proof and demonstrate conscious and flagrant indifference to the safety of others, you can

say to a corporation worth several billions of dollars, it would cost less to

pay awards than it would to fix the

problems. A punitive damages cap is

appropriate. I really believe the Senate

would improve this legislation by

adopting the very position the two

managers of the bill had last year.

Their first and best instinct was not to

have a punitive damages cap then. I believe that is the position the Senate

ought to adopt now.

Mr. President, with that, I would

hope, when we have another vote on

this, the Senate will decide to eliminate the punitive damages cap. With

that, I yield the floor.

Mr. GORTON addressed the Chair.

The PRESIDING OFFICER. The Senator from Washington.

Mr. GORTON. Mr. President, unlike

the situation at the time at which the

Senator from North Dakota presented

this amendment a week or so ago, we

now have a bill in the Chamber in

which there is no cap on punitive damages. I say that not in triumph but in

regret. I believe that one of the great

vices at which legislation of this sort

properly should be aimed is at creating

some kind of relationship between the

actual damages caused by a tort,

caused by a wrong, and the damages

that can be recovered as a result. But

with the latest set of amendments

here, we have permitted a judge on certain findings of egregious conduct to go

beyond what juries are permitted successfully to impose in the way of punitive damages.

The entire matter, Mr. President, is

at one level an argument on philosophy

but at another level it is a debate

about the Constitution of the United

States. The Supreme Court in several

recent cases, while not setting a specific ceiling or cap on punitive damages itself, has spoken of serious constitutional questions caused by unlimited punitive damages, or by punitive

damages that are not related in any rational fashion to actual damages found

by a jury or determined by a court.

In other words, the Supreme Court of

the United States has invited the Congress to do exactly what I had hoped

we would do more successfully than we

have accomplished in this bill.

But just to go over it again, we have

said that the maximum punitive damages that can effectively be awarded by

a jury are in an amount twice the total

of all economic damages and all noneconomic damages that go for pain and

suffering. And since those damages, in

very serious cases of people being

maimed for life, can well go into eight

figures, and sometimes do, we have a

very large potential remaining for punitive damages. But in addition to that

provision, in the so-called Snowe

amendment is a $250,000 figure when

twice the total of economic and noneconomic damages would be less than

$250,000, together with the right of a

judge to go beyond even the Snowe formula where the judge feels that formula to be too limited not to permit

proper punitive damages for particularly egregious conduct.

So the Senator from North Dakota,

in a number of respects, has already

succeeded. There is no number. There

is no specific formula which limits punitive damages.

As I have said frequently, I think

there should be. Working with the laws

of my own State and a handful of other

States where punitive damages are not

allowed at all, where the cap is zero in

most cases, we find no difference in the

safety or carefulness of business enterprises in those States. No case has been

proven for the efficacy of punitive

damages as a deterrent, in any event.

My own view is that the original limitation in this bill was an appropriate

one, but that original limitation has

twice been liberalized in the course of

this debate. And I express the fervent

hope that in concerning ourselves with

the proposition that we should not permit absolutely unlimited discretion on

the part of juries, we should not have

no maximum sentence in civil cases for

wrongs, that we will make the partial

and halting move toward some kind of

rationalization which is now contained

in this bill.

Mr. President, we are in a peculiar

situation here this morning in that we

have a potential of this amendment

and one other to be dealt with and we

do not have specific limitations on the

amount of time that can be utilized for

them. So I hope that, when either the

Senator from West Virginia or the Senator from North Dakota next speaks,

we can get an indication as to when

they will finish to allow the other

amendment to take place. There will

be votes on any other amendments

which come up, but we will be asking

unanimous consent that those votes

take place after closing arguments and

before the vote on final passage. So the

sooner we know how long these two

amendments will be debated, the earlier we will be able to predict to our

Senators who are not here when they

will have to come back to the floor to

vote.

Mr. ROCKEFELLER addressed the

Chair.

The PRESIDING OFFICER. The Senator from West Virginia.

Mr. ROCKEFELLER. Mr. President,

a couple of points. I agree with what

the Senator from the State of Washington said in argument to this amendment.

Just for the edification of my colleagues—this fact has not been brought

out, I do not believe, in the debate—we

have removed caps, but people do not

realize, I think, often that there are

caps on some rather extraordinary

crimes in the Federal statutes. I will

give some examples.

Many Federal criminal fines, even for

particularly egregious crimes, do not

exceed $250,000. And that was our original proposal, economic damages times

three or $250,000, whichever is greater.

Listen to this. If you tamper with

consumer products and it results in

death, the Federal statute limitation is

$100,000 for punitive damages. If you retaliate against a witness, it is $250,000.

If you assault the President, it is

$10,000. If you rob a bank with the use

of a deadly weapon, the punitive damage limit cap is $10,000. Sexual exploitation of children for an individual,

$100,000; in terms of an organization—

however that would work out—$200,000.

For treason—for treason—$10,000.

Now I say that in no way to defend

caps, because the Senator from West

Virginia has fought for the removal of

caps and we have, I believe, been able

to do that.

I would, in closing, remind my esteemed friend and colleague from the

State of North Dakota, who is as principled a person as I have ever met, that

the Senator from the State of Washington and I have so bloodied ourselves in

making sure we come back with effective removal of caps that we have said,

and that we have been unable to obtain

unanimous consent in this body to, in

effect, make the cap total and complete because of a matter of 60 seconds

in filing the amendment, that if we

bring back the amendment with anything but the cap removed, that we will

vote against the motion for cloture

should there be a filibuster on the conference report.

So I really do believe that we are operating not only in good faith but in

good substance on removal of the cap.

I hope, therefore, that what I consider

a redundant amendment by the Senator from North Dakota would be defeated.

I thank the Chair and yield the floor.

Mr. DORGAN addressed the Chair.

The PRESIDING OFFICER. The Senator from North Dakota.
S6372 CONGRESSIONAL RECORD — SENATE May 10, 1995

Mr. DORGAN. I shall not prolong the

debate. When I have completed with

my remarks, I see no reason that you

could not enter a unanimous-consent

request to have a vote. I have no objection to a vote.

First, let me make a couple of comments. The Senator from Washington

said, and I think the Senator from

West Virginia also seemed to say, the

way the bill is constructed, there really are not caps on punitive damage

awards. If that, in fact, is the case,

then I would think that they would

have no objection to accepting language that says there are no caps on

punitive damage awards. That is what

my amendment says.

That was the Commerce Committee

position last year on this bill. It was

the right position. We raised the bar on

what you must prove to receive a punitive damage award. Once we raised the

bar, we felt it inappropriate to include

caps. Now this year they want to include caps.

When the two Senators say there are

not really caps, I understand what they

are referencing. But, honestly, I think

the claimants will find there are caps.

There is $250,000 written in. That is

written there for a reason. Because,

under ordinary circumstances, that

will be a cap, two times compensatory

damages.

Let me make two other quick points.

Mr. ROCKEFELLER. Will the Senator yield?

Mr. DORGAN. I am happy to yield.

Mr. ROCKEFELLER. Just as a point

of clarification, the reason that the

$250,000 was put in there in its new configuration was not in terms of the caps.

We made certain that there was an alternate ceiling. So that if the economic

damages and the noneconomic damages

did not appear to arrive at $250,000 multiplied by two, that the claimant would

be guaranteed the $250,000. It is an alternate ceiling.

Mr. DORGAN. If the Senators were

building a floor rather than creating a

cap, I say, God bless the floor and let

us just get rid of the cap. Let us vote

for my amendment and we will solve

this.

But, let me make two other comments. First, if a company, a large

company with vast resources, produces

a product or a device that will be used

in the field of medicine discovers, during its testing, the product is sufficiently faulty in its operation and it

may cause some deaths; if the company

fails to disclose that information and

the product goes to market and some

unsuspecting patient lies on a hospital

gurney going into the operating room

and dies during a routine procedure

and later the family discovers that person died because the product used was

faulty and the company knew it, I suppose they would want to bring a lawsuit against the company. In that case,

I think society would want that company to be punished sufficiently so

that other companies would understand you cannot do that, that kills

people; you ought to be punished for it.

You ought not get a slap on the wrist,

you ought to be punished for it.

That is what punitive damage awards

are for. The case I just mentioned is a

real case, and there are plenty of cases

like that.

There is not an epidemic of punitive

damage awards in this country. It happens rarely because it requires a substantial burden of proof, and we have

increased that burden. There is no litigation crisis with respect to punitive

damages. In 25 years, the survey that I

have seen—1965 to 1990—says that 355

punitive damages were awarded in

State and Federal product liability

lawsuits nationwide. This is a country

of 250 million people; 355 punitive damage awards nationwide. Of those

awards, 35 are larger than $10 million.

All but one of these awards were reduced, and 11 of the 35 were reduced to

zero.

The point I make is, this is not an

epidemic or crisis. Punitive damage

awards have not been escalating out of

control. But I do think there are certain circumstances where an enterprise

worth billions makes a conscious decision that we will risk whatever awards

exist out there because we will gain

more profit by selling this, knowing

the defects, than we will risk paying

the damages to someone injured or

killed by that product.

My own view is that there is merit on

both sides of the debate on product liability. That is why I have decided to

support and have supported moving

forward, increasing the standards, trying to shut down some of the litigation

in this country, because there is too

much frivolous litigation, as a matter

of fact. The country is just prone to

litigate almost everything. We have

too many lawyers in America. And we

keep training more and more every

year.

I think there is merit to the position

of the two Senators, that we ought to

do something in a reasonable way on

product liability. I think there is no

merit to putting a cap on punitive

damages. There was not merit to it last

year. They did not have it in the bill

last year. They changed their minds.

Their first instinct is correct. Always

stick with your first instinct. My

amendment will allow us to stick with

your first instinct. If the Senate

agrees, we will live with your victory

of last year deciding there shall not be

punitive damages in the product liability bill.

Mr. President, with that, I yield the

floor.

Mr. GORTON addressed the Chair.

The PRESIDING OFFICER. The Senator from Washington.

Mr. GORTON. Very briefly, Mr.

President, I think that Members should

know that this amendment by the Senator from North Dakota is all-encompassing and that it overrides the

amendment which was supported by

the vast majority of Members of the

Senate that does have strict limits on

punitive damages in cases involving

small businesses, businesses with fewer

than 25 employees and individuals of

relatively modest means whose total

assets are less than half a million dollars.

So they, after having been the beneficiary of the last week of that very

careful protection, protection against

absolute bankruptcy, should the Dorgan amendment be adopted, they will

be thrown into a situation in which absolutely unlimited punitive damages

can be awarded against them. It is important for Members to understand

that.

UNANIMOUS CONSENT AGREEMENT

Mr. GORTON. With that, Mr. President, now having cleared this with the

Democratic side, I ask unanimous consent that the vote on, or in relation to,

the Dorgan amendment, or in relation

to any other amendment in order, and

final passage occur back to back at the

conclusion of the previously allotted

time with the first vote limited to 15

minutes and the other consecutive

votes in the voting sequence limited to

10 minutes each.

The PRESIDING OFFICER. Without

objection, it is so ordered.

Mr. DORGAN. Mr. President, I was

going to ask for the yeas and nays.

Mr. GORTON. I move to table the

Dorgan amendment and ask for the

yeas and nays.

The PRESIDING OFFICER. Is there a

sufficient second?

There is a sufficient second.

The yeas and nays were ordered.

Mr. HEFLIN addressed the Chair.

The PRESIDING OFFICER. The Senator from Alabama.

Mr. HEFLIN. Mr. President, I rise to

speak against passage of this bill. I realize that, with cloture having been invoked, my words may not change many

votes, but maybe they might change

one or two. And then I feel like maybe

my remarks, in a strong adversarial

posture, might appeal to the reason of

Senators to encourage them to eliminate some of the grossly unfair provisions that are in this bill.

I might say in the beginning that I

believe the difference between the caps

that are put in this bill and the fact

that there were no caps in the last bill

reflects a change in the makeup of the

Senate, as a result of last November’s

elections.

There are caps in this bill with an

additur provision whereby a judge

could increase a jury’s award of punitive damages. Clearly, that has already

been ruled on by the Supreme Court as

being unconstitutional. The case of

Dimick versus Schiedt was decided in

1935 on that issue and makes the

additur provision unconstitutional.

In my judgment, there are a number

of other unconstitutional elements

that should be pointed out. One is the

matter pertaining to the role of the

U.S. circuit courts of appeal being able

to determine controlling precedent on

the State courts within the jurisdiction of the Federal circuit.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6373

Article III of section 1 of the Constitution, which provides that the judicial power of the United States shall be

vested in one Supreme Court, has been

construed to mean that the State

courts must follow the decision of the

Supreme Court and not the lower Federal courts.

The case of Erie versus Tompkins basically says that the Federal courts, in

diversity cases, shall follow the substantive law of the State. There is no

question that the Federal courts,

through its rulemaking process and

Congress, pursuant to its powers under

the Rules Enabling Act, control in regards to procedural matters. I just

want to mention that.

I want to direct the Senate’s attention to a chart that Senator LEVIN produced and used in a previous argument.

I thought it was an excellent presentation, and I ask unanimous consent

that this table be printed in the

RECORD.

There being no objection, the material was ordered to be printed in the

RECORD, as follows:

PREEMPTION OF STATE PRODUCT LIABILITY LAWS UNDER

S. 565, AS REPORTED

State laws

more favorable to plain- tiffs

State laws

more favorable to defendants

Liability of product sellers .......................... Prohibited ..... Allowed. Alcohol or drug abuse defense ................... ......do ........... Do. Misuse or alteration of product defense .... ......do ........... Do. Punitive damage limitations ....................... ......do ........... Do. Statute of limitations .................................. ......do ........... Prohibited. Statute of repose ........................................ ......do ........... Allowed. Joint and several liability (non-economic

damages).

......do ........... Do.

Biomaterials provisions ............................... ......do ........... Do.

Mr. HEFLIN. Mr. President, this is

chart entitled ‘‘Preemption of State

Product Liability Laws,’’ and it has a

column of State laws more favorable to

plaintiffs and State laws more favorable to defendants and what happens as

regards preemption under this legislation. First as to the liability of product

sellers, that is retailers, this bill prohibits any laws more favorable to

plaintiff, but it allows laws more favorable to the defendants. Second, with respect to the alcohol or drug abuse defense, the bill prohibits State laws

more favorable to plaintiffs but it allows State laws more favorable to defendants. Third, as to the misuse or alteration of product defense, the bill

prohibits State laws more favorable to

plaintiffs but allows State laws more

favorable to defendants.

Punitive damage limitations are

treated the same way—unfavorable as

to plaintiffs and favorable as to defendants. As to the statutes of limitations,

that is the one and only provision that

really exists in this whole bill is as to

uniformity.

With regard to the statute of repose

provision of 20 years, this bill preempts

State laws more favorable to plaintiffs

but not those State laws more favorable to defendants.

On the issue of eliminating joint and

several liability for noneconomic damages, this bill preempts State laws

which are more favorable to plaintiffs

but allow State laws which are more

favorable to defendants. And you have

the biomaterials provisions which are

treated in the same manner. I think

this chart Senator LEVIN prepared is a

very excellent chart, and I hope my

colleagues will take time to reflect

upon it.

Now, I want to also direct my colleagues attention to the potential costs

of the bill, an issue which I hope will be

investigated, because I do not believe

CBO or anyone else has looked at this

matter very closely. There is language

in the bill that includes within the

scope of the word ‘‘claimant’’ a governmental entity which includes the Federal Government and all of its entities.

I do not think there is any question

that the purpose of this bill is to save

product manufacturers money. The

Government, as a claimant, would be

bringing suit against a defendant, and

if the purpose of the bill is to save

money, it means it saves money for the

defendant, for corporate America, when

the Federal Government brings suit.

So the cost to the Government has

never been calculated, and there are so

many things that are involved, particularly like the statute of limitations

and statute of repose as to helicopters,

tanks, NASA equipment, and all of

GSA’s equipment, and every conceivable way regarding which products are

purchased by the Government. The

issue of costs to the Government ought

to be looked at more closely in my

judgment.

Now, there is also a provision dealing

with foreign nationals and foreign governments, and I realize that this is

under statutory construction, that

nothing in this title can be construed

to preempt State choice of law rules

with respect to claims brought by a

foreign nation or a citizen of a foreign

nation and, in effect, 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 grounds

of inconvenient forum.

In the world of terrorism today,

these issues ought to be addressed.

Hopefully, in the terrorist bill that will

come before the Senate in the coming

weeks, we will give some consideration

regarding this issue. The Senate ought

to make certain that the provisions of

this product liability bill do not in

some unintended way give some advantage to a terrorist entity.

I think one of the most unfair provisions in this legislation is the provision

that says that an injured party cannot

introduce in the compensatory damage

part of a trial elements of conduct that

constitute a cause of action for punitive damages. Therefore, as I have

pointed out before, gross negligence,

recklessness, wantonness, intentional

conduct, and all activity of a similar

nature, is prohibited from being considered in the main trial for compensatory damages. To me, that is one of

the most unfair provisions that exist in

this bill.

The biomaterials section and the definition of implants therein, where

there is language regarding coming in

contact through a surgically produced

opening and coming in contact with

bodily fluids or tissue, in my judgment,

is a wide-open situation for a great

deal of problems pertaining to component parts of the implant, and I urge

that that be carefully reviewed.

Some of these issues which I have

just reviewed—and I hope some people

in the White House are listening to me

as I speak about this—ought to be carefully considered not only by the Department of Justice and every agency

of Government that could be affected.

Certainly, the FDA ought to consider

the language that is being placed into

this bill as to matters dealing with the

human body in that biomaterial definition of ‘‘loss.’’

Of course, the very basic unfairness

of the bill begins with the fact that

commercial loss, which is a business

loss, is excluded from being within the

purview of this bill.

Of course, I have given illustrations

on the floor about the fact that if a factory blows up and people that are injured from the faulty, defective product, they come under this bill; but for

commercial law, they do not.

Some say the commercial loss exemption might be applied to individuals. I remember there was a ‘‘Dear

Colleague’’ letter circulated on this

issue. I would imagine in that instance

we would find it would be rarely ever

used, we might find out of 2,000 employees in a factory where a boiler

blows up, we might find that there

might be one moonlighting sock salesman. That would be the only way that

we would have, basically, any commercial loss that would occur to that individual.

Now, most of all of the business litigation and most of the punitive damages awards that have come about are

business or commercial losses. The

case of Pennzoil versus Texaco was, for

example, probably the largest punitive

damages case that has ever been

awarded, and it was a commercial litigation where business was suing other

business.

There are other provisions throughout the bill that are very unfair, and I

have listed them in previous arguments. I hope that this bill will be

carefully reviewed in conference and

we will see the removal of a great number unwise provisions.

I just appeal to the conscience of the

people that are involved who will be in

conference on this, and appeal to the

White House to look at this matter

when it reaches conference between the

House and Senate. It just shocks the

conscience to see the unfairness that

exists in all the various provisions of

this bill and I hope that I have pointed

out the key issue very clearly for my

colleagues to consider. Mr. President, I

urge that we vote no on final passage.
S6374 CONGRESSIONAL RECORD — SENATE May 10, 1995

Mr. ROCKEFELLER. Mr. President, I

encourage my colleagues would vote

aye on this bill.

Mr. President, while I had my doubts,

I have believed for a long time that the

Senate would eventually come to this

point. Inexorably, it would happen.

After many years of debate, many

years of filibusters on this Senate

floor, this body finally has a chance to

cast its vote for what I think is responsible, balanced punitive damages tort

reform.

I think the vote yesterday was historic. The Senate, for the first time,

broke the log jam that has blocked action on what I referred to last night as

a deadly serious issue, and the Senate

has blocked that for years and years.

Now the Senate has said, ‘‘proceed.’’

My belief that this time would come

is based on several points. First and

foremost, the problems with our punitive damages system cry out for solutions. We are here for that purpose. We

were elected to address the problems

that require attention and action. We

have done so to the best of our ability.

In this case, because products by definition, virtually, involve interstate

commerce—that point has been made

but not accepted, I suppose, by all—70

percent of everything we make in West

Virginia is sold in another State. By

definition, States cannot preoccupy

this field. This is precisely an area

where Congress needs to step in.

Each State really cannot fix the

flaws of the country’s interstate product liability system. That is because

the biggest problem involves the patchwork—varied, unpredictable nature—of

every State in the union having different product liability rules and

standards.

Businesses that sell or manufacture

products are subject to the endless confusion, the hassle, the court costs, the

wasteful costs, in general, of this maze.

Consumers who want safe products

want more products that will increase

their safety and cannot get them. Consumers who are victims of defective

products and cannot get recompensed

for an average of 3 years, are also hurt

by the delays and the costs that stem

from the product liability system. So

businesses hurt, consumers are hurt.

We have a problem.

My interest in these problems really

stem from seeing the way they hurt my

own State of West Virginia. Manufacturers, small businesses, the fear, consumers, workers, and the victims of defective products.

The Senator from North Dakota several moments ago said that there has

only been x numbers of liability cases

in the last 2 years, 10 years whatever.

That argument has been used many,

many times. It is a very misleading,

false argument. It is not the number of

punitive damages awards that have

been granted. It is the threat which exists in every case, in every suit, of

which there are unending numbers in

this litigious society.

It is the threat of litigation that is

the problem and has crushed so much

innovation and research and development which would help consumers.

My interest, again, in West Virginia

comes from knowing people who directly have suffered from this and have

gone out of business from this, as well

as victims who have been hurt by this.

I have seen the victims who came back

from the Persian Gulf war with something called a mystery syndrome illness which the Defense Department

says does not exist, but I see these people and I know it does exist.

When we see the people, and we see

the individuals and we see they are

hurt, we want to help them. To put it

simply, then, the product liability system is broken. The Congress and the

President must have parity.

Second, I have believed that a product liability reform bill would eventually pass this Senate because of the

way some Members have approached

the effort to cause it to pass, which I

believe it will.

Members of both sides of the aisle

have been troubled by the problems

with product liability. Some time ago

the bipartisan team work necessary to

enact legislation began to form. In the

past 4 years, the Senator from the

State of Washington and I have had the

job of leading that team. The Senator

from Washington and I made a pact: To

promote a balanced, moderate, serious,

legislative remedy to these problems in

product liability, tort reform.

We let the businesses interested in

reform know that the consumers and

victims had to be the winners of reform, too. We made that very clear and

have made that very clear up until the

very last moments. We have kept making it clear.

We explained to the general public

that the harm done to business by the

problems with product liability also

hurt the general public, which is called

the rest of the country. They cost jobs,

they stifle the innovation needed to

make safer drugs and products, and

they impose an enormous hidden tax

on every American.

That is why we devised a bill to deal

with the range of problems that affect

different sectors of the society, and we

did it fairly. In this legislation we promote quicker settlements through alternative dispute resolution. We insisted on that so victims get compensation faster. We give the victims of

harm done by substances like asbestos

enough time to seek relief by saying

the clock can only run after they discover the harm that they are suffering

and, again, the reason, the cause of the

harm they are suffering.

We have made a number of adjustments in the way businesses are made

liable for the impact of products where

the rules are not fair to them.

But my point is also that this bill reflects the balance and the moderation

that emerges when Members of both

sides of the aisle choose to work together, choose to trust one another,

choose to accommodate the diverse

concerns that arise when a complicated

topic like product liability comes up.

We are not seeing a lot of bipartisanship in the legislative process these

days, and it is sad. It is more than sad

for the country, it is grievous. I find all

of that very troublesome. I think it is

essentially a disservice to the country.

We are a diverse nation with a Government designed to represent our differences and built with checks and balances on one another. We should draw

on the strength of that diversity.

Democrats and Republicans in the Senate should spend more time, I think,

working together on the country’s

problems, working out solutions that

will last and that will take root.

I think we do that in this bill. And

when we do have bipartisan cooperation and it works, it only encourages

us to do more, I hope. That is why the

Senator from Washington and I formed

the team to deal with the problems of

product liability, and we intend to

maintain that bipartisanship until we

see a bill signed into law sometime

later this year.

Finally, my belief that product liability legislation would pass has been

based on the talent and the leadership

that have been invested in this effort.

Many Members of this body have contributed to this arduous, difficult effort. Senators DODD and LIEBERMAN

have been staunch allies, and their

staffs, Tony Orza and Nina Bang-Jensen. Senators on the other side of the

aisle, from the majority leader to the

chairmen of the Commerce and Judiciary Committees, have played essential

roles in this. It is impossible to fully

explain how much I respect and appreciate the Senator from Washington,

SLADE GORTON. I think he stands out

for, first of all, his acumen, his amazing mind, his tenacity, the wisdom of

his counsel, his calmness under substantial fire, and his commitment to

reform.

The staff who have assisted in this effort I think deserve medals for their

valor and service and for their, by the

way, exhaustion. On Senator GORTON’s

staff, Lance Bultena and Trent

Erickson have been steady, quiet, dogged, and perfect in helping us work this

through.

Assisting me, I cannot thank enough,

and I would need to start with Tamera

Stanton, who is my legislative director

who sits at my left as I speak, who

masters all subjects with tenacity and

with understanding, is skillful in her

sense of nuance, strategy, politics, and

policy; Ellen Doneski, who does not

know how to stop working, and as a result never does stop working and accomplishes incredible, amazing things,

often many at the same time, so she

just never stops working; Jim Gottlieb

and Bill Brew, both in fact lawyers,

which we need in our office. And they

have both been brilliant, skillful, dogged, and successful. Without their labors and their incredible talent we

would not be at this point.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6375

I do not want to take the body’s

time, but I just want to make the point

again that, if you pick up the paper,

you will read Senator GORTON’s name.

If you listen to the television, you will

hear his name and Senator HOLLINGS’

name. And they can both do all of this

on their own, pretty much, anyway.

But actually it does not quite work out

that way. Just as Senator HOLLINGS,

Kevin Curtin, and others—it is the public that needs to know, while they are

in their orgy of dislike for the Federal

Government, that there are incredible

people called staff of the U.S. Senators

who make possible what it is that we

do.

I want to acknowledge with respect

the persistence and commitment of the

flag-bearers who took the other side on

this issue. The Senators from Alabama

and South Carolina are daunting in

their own legal minds and ferocity

when it comes to this issue—both of

them. They are different in many ways,

the same in many ways, but both of

them are extraordinary in their commitment to their beliefs. I hope they

would agree it was a fair and open debate. They prevailed in the past without exception. It worked out the other

way this time.

This has not been an easy issue for

anybody involved. The legal system is

a very serious part of our national fabric and life. The rights of every American are fundamental and are not to be

tampered with easily. I have always

felt that, as I have fought for product

liability reform, in a sense I restate my

pledge to navigate the remainder of the

legislative process with a deep commitment to the principles of fairness and

justice.

But I remain absolutely sure that it

is time to fix this broken part of our

legal system, and I think we have done

a lot of it. The country is saddled with

costs, with waste, with problems that

can be eased with the reforms in this

legislation.

The PRESIDING OFFICER (Mr.

SANTORUM). The time of the Senator

has expired.

Mr. ROCKEFELLER. Mr. President, I

ask for an additional 60 seconds.

The PRESIDING OFFICER. Without

objection, it is so ordered.

Mr. ROCKEFELLER. I am proud to

give the Senate a chance, finally, to

cast its vote on a balanced legislative

remedy. I am relieved we restored a

bill simply dealing with product liability and with the important changes

worked out in the final hours that represent the bipartisanship and the balance that we sought from the beginning of this effort.

I am confident that President Clinton will sign this bill with whatever

perfections we can make. I hope we will

soon see the benefits of reform and

demonstrate to the skeptics that the

changes are in the entire Nation’s interests.

I yield the floor.

The PRESIDING OFFICER. The Senator from Washington.

Mr. GORTON. Mr. President, first a

procedural announcement. Thirty minutes remains under the order with respect to debate on product liability.

Senators in their offices, therefore,

should be on notice that approximately

at 11:40 there will be a vote on my motion to table the Dorgan amendment,

followed immediately by a vote on

final passage of the product liability

bill with, we think, the substitute

adopted by voice vote. So Members

should be prepared to come to the floor

at or shortly after 11:40.

On a second matter, in which I know

I am joined by my colleague from West

Virginia, regrettably, due to the inability of the Senators from Washington

and West Virginia to get unanimous

consent to make one additional change

in their proposal, the so-called new

trial provision after an additur remains

in this bill. The Senators from West

Virginia and Washington have pledged

that the bill will not be presented by

them to this body with that provision

in it, and that pledge remains.

Other than that, this bill is the work

of many years of effort culminated in

this Congress, as in the last Congress,

by the joint efforts of the Senator from

West Virginia and myself, and of many

others whom I will mention after we

have had a final vote. Together, with

the input from Members on both sides

of the aisle, I am confident that the

bill will pass and that it will represent

a significant step forward.

Mr. President, one other comment

that I make as a sponsor and one of the

people who drafted this bill in the punitive damages section, we included an

additive provision at the request of the

Department of Justice of the United

States, with the assurance that the

provision is constitutional. That opinion, in my view, is correct. Such provisions are found in the laws of many

States. If a court should, however, find

the additive provisions to be unconstitutional, it is our intention that the

remainder of the punitive damages provision will stand and that only the additive provision which is now found in

section 107(b)(3) would be severed.

Mr. President, one argument against

congressional legislation in this field,

which has been raised by almost all of

those who have come here to speak

against it, is that we should not interfere in the Federal system with the

laws of the 50 States. It is a curious argument as it is generally advanced by

those Members of this body who are

most anxious to interfere with the prerogatives of the States in many areas

for which there is no explicit constitutional warrant. This, however, is a case

in which congressional legislation is

expressly warranted by the Constitution, and may very well have been anticipated, or would have been anticipated had they known what the economy of the United States would look

like in the late 20th century, by those

who wrote the Constitution itself. One

of the principal reasons for the Constitutional Convention was the chaos

that attended interstate commerce

among the 13 States after the close of

the War of the Revolution and before

the adoption of the Constitution.

So under article I, section 8, clause 3,

the interstate commerce clause, the

Congress is invited, is given plenary

power over interstate commerce. Of

course, most of the products with

which this bill deals are made of materials that arrive in interstate commerce and are sold after they are manufactured in interstate commerce, and

a far greater degree of uniformity that

is now in this bill would be constitutionally warranted. The compromises

in this bill are in certain cases political and in other cases highly principled

attempts to provide a degree of predictability and uniformity which will

lead to more economic development,

greater jobs, and better products for

consumers with the very real history of

local control over our courts and over

our litigation. But as long ago as in the

Federalist Papers, Alexander Hamilton

made it clear that one of the key purposes of the Constitution was to prevent interstate commerce from being,

and I quote him: ‘‘Fettered, interrupted, and narrowed’’ by parochial

State regulations.

That, regrettably, is exactly what we

have, particularly in that handful of

States, often in rural counties, in

which we find repeated huge punitive

damage awards, almost invariably entered against out-of-State defendants

or out-of-State corporations in a way

which fetters, interrupts, and narrows

interstate commerce by discouraging

research and development and discouraging the marketing of new products.

We have seen that happen in instance

after instance in which companies

large and small have found it improvident to develop new products to cure

previously incurably diseases or to

solve problems in our society because

they might have an adverse impact on

some individual, and that individual

might sue and that individual might

persuade a jury in someplace or another to award punitive damages in an

amount that would make it utterly unprofitable ever to have entered that

business in the first place.

Perhaps worse, and perhaps a greater

interference with interstate commerce,

is successful defense litigation where

large companies find that they have

spent tens of millions of dollars successfully defending against product liability litigation over products, that

gross price of which is far less than

those legal fees. So they say, ‘‘Why

produce parts for implant into the bodies of people of the United States, as

much good as those things do?′′

It is our hope to make a modest step

forward in creating a balance, not by

denying any person the right to go to

court, not by limiting the actual damages that any individual can receive for

an act which is the responsibility of

the individual or company which is

called upon to make payment, but to

see to it that there are fewer arbitrary
S6376 CONGRESSIONAL RECORD — SENATE May 10, 1995

judgments; that less of the time defendants are required to pay for the

negligence or for the acts of others.

Mr. President, a day or so ago, the

Senator from California [Mrs. BOXER],

argued at length with respect to the

McCain-Lieberman portions of this bill

on biomaterials and that corporations

would be allowed to set up shell subsidiaries and protect themselves from

liabilities.

That concern was raised in the Commerce Committee by the Senator from

Nebraska [Mr. EXON], and expressly

taken care of by an amendment that

will allow piercing that corporate shell

and not preventing the corporation,

which is actually in control and which

has assets, from protecting itself from

the consequences of its own negligence.

But basically, Mr. President, we now

have a product liability bill which includes a statutory repose for products

that are used in a business enterprise.

We have a limitation on joint liability

with respect to noneconomic damages—that is, pain and suffering—

under which we simply say that you

are responsible as a defendant for the

degree to which you have harmed the

claimant, but that a defendant that is

only 10 or 20 percent responsible for

these damages is not going to be

charged for the entire verdict simply

because some other defendant cannot

be reached.

We have imposed some modest rationality on the award of punitive damages. My colleague here this morning

came up with one of the best sets of examples I have ever heard, something

which has not been brought before the

Senate in this 3 weeks, when he points

out that for all practical purposes

every Federal criminal statute which

includes the right to a fine as a part of

the sentence has a limitation on those

fines, and yet to be subjected to a

criminal fine one must be found guilty

beyond a reasonable doubt. One has all

of the protections of the fifth amendment against self-incrimination. And

yet here we, the Congress of the United

States, have set a maximum fine,

$10,000; maximum fine, $25,000. I think

the maximum fine they found was

$250,000.

We vote for these criminal penalties,

and yet our opponents tell us how outrageous it is in a civil case, with no

fifth amendment rights, no standard of

proof beyond a reasonable doubt, how

unreasonable it is to set any limit on

what a jury can do in the way of punishment—punishment over and beyond

all of the damages that are actually

proven by the claimant in a particular

case.

Mr. President, this bill is not a perfect bill, in my view, and it is not a

perfect bill because it does not limit

that form of arbitrary punishment sufficiently. But it does begin down a road

which we have been invited to take by

the Supreme Court of the United

States which says without having set

standards itself that there are constitutional implications to unlimited

punitive damage verdicts. And so here

we have an experiment. We attempt to

balance the rights of trial lawyers

against the necessity for a better and

more effective economy, one in which

people are encouraged to innovate, to

create new jobs and to create new products for the American people.

We have been at this for a long time.

I know from personal experience that

there were product liability bills in the

Senate and in the Commerce Committee on which I serve as long ago as 1982.

I suspect that they existed before that

time. I can remember one product liability bill in that committee against

which I voted myself because it seemed

to me it went too far, that it was unbalanced on the other side. This one is

not, Mr. President. This one is a good

piece of legislation. It is something

that will help the American economy

and help the cause of balanced and appropriate justice.

Finally, Mr. President, it is a precedent in a sense but it has one preceding

element. A year or so ago, we passed a

very modest product liability bill for

piston driven aircraft. The legal system, the legal system defended by the

other side here, had destroyed that

business, reduced its production by 95

percent. A modest change in the law at

the Federal level has already contributed to the recovery, the beginning of

the recovery of that business—a dramatic illustration that the horror stories are not true and that the promises

made by the proponents of this litigation have been proven to be valid by

history. If my colleagues will vote for

this, if we get it accepted by the House

and signed by the President of the

United States, this country will be significantly better off.

Mr. HOLLINGS addressed the Chair.

The PRESIDING OFFICER. The Senator from South Carolina.

Mr. HOLLINGS. Oh, so reasoned, says

my distinguished colleague from Washington. It is so balanced. GOPAC has

taken over. GINGRICH is the Speaker,

and there is a contract. Look at the

elements of this contract. Part and

parcel either by way of amendments

here or in bills on the House side or

what they have in mind is not just

product liability but they have limiting pain and suffering damages; they

have limiting the punitive damages;

they tried to fit in medical malpractice; they tried to then limit plaintiff’s attorney’s fees. They voted

against the fees on the defendants.

They were not making enough. They

ought to make more than $133,000 a

year. They tried to limit punitive damages in all civil cases. The English rule

is in the bill over on the House side;

the alternative dispute resolution with

the plaintiff having to pay all the fees;

the securities litigation, the FDA and

FAA rules where they would bar damages if the product is approved by either of those entities; they exempt the

medical devices and the doctors, a provision about frivolous suits, statutes of

repose; restricted submission of evidence is in this bill, in the House bills,

bifurcation of the trials, both actual

and punitive damages. Then they even

put in an unconstitutional additur provision here.

Like the sheepdog had tasted blood,

with product liability they are going to

gobble up all the other rights and say

it is so reasoned and so balanced.

One exemption they have from all

this, Mr. President. One exemption—

the manufacturers, the very crowd that

through this bill continue to put in the

amendments and everything else. They

exempt the manufacturer and apply

this all to the injured party and have

the unmitigated gall to come up here

and say they are for consumers. Why,

heavens above. Come on.

I ask unanimous consent to include

in the RECORD the State-based organizations opposed to this legal reform

bill.

There being no objection, the list was

ordered to be printed in the RECORD, as

follows:

STATE BASED ORGANIZATIONS OPPOSED TO

‘‘LEGAL REFORM’’ IN THE SENATE (S. 565)

Alaska PIRG.

Arizona Citizen Action.

California Citizen Action.

Center for Public Interest Law at the University of San Diego.

California Crime Victims Legal Clinic.

Fair Housing Council of San Gabriel Valley.

Colorado Steelworkers Union Local 2102.

Coalition of Silicon Survivors.

Colorado DES Action.

Denver UAW.

Colorado ACLU.

Denver Gray Panthers.

Colorado Public Interest Research Group

(CoPIRG).

Colorado Clean Water Action.

Colorado Senior Lobby.

Connecticut Citizen Action Group.

ConnPIRG (Connecticut Public Interest

Research Group).

Delaware Coalition for Accountability and

Justice.

Delaware AARP.

Delaware Council of Senior Citizens.

Delaware AFL–CIO.

Delaware Federation of Women’s Clubs.

Delaware Women and Wellness.

Delaware Breast Cancer Coalition.

Building Trades Council of Delaware.

UAW Local 1183—Delaware.

Delaware Sierra Club.

Delaware Audubon Society.

Save the Wetlands and Bays—Delaware.

Georgia Consumer Center.

Idaho Citizens Action Network.

Idaho Consumer Affairs, Inc.

Illinois Council Against Handgun Violence.

Citizens Action Coalition of Indiana.

Planned Parenthood of Maryland.

Law Foundation of Prince George’s County.

Maryland Sierra Club.

Teamsters Joint Council No. 62.

UFCW Local 440.

White Lung Association & National Asbestos Victims.

Sexual Assault/Domestic Violence Center,

Inc.

IBEW Local 24.

Maryland Clean Water Action.

Maryland Employment Lawyers Association.

Health Education Resource Organization

(H.E.R.O.).

Environmental Action Foundation.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6377

Massachusetts Consumer Association.

Minnesotans for Safe Foods.

Missouri PIRG.

Montana PIRG.

Nebraska Coalition for Accountability &

Justice.

Nebraska Farmers Union.

Nebraska Women’s Political Network.

Nebraska National Organization for

Women.

United Rubber Workers of America, Local

286.

Communications Workers of America,

Local 7470.

Nebraska Head Injury Association.

Nebraska Center for Rural Affairs.

White Lung Association of New Jersey.

Consumers League of New Jersey.

Cornucopia Network of New Jersey.

New Jersey DES Action.

New Jersey Environmental Federation.

New Mexico Citizen Action.

Essex West Hudson Labor Council.

Uniformed Firefighters Association of

Greater New York.

New York Consumer Assembly.

Niagara Consumer Association.

North Carolina Consumers Council.

North Dakota Public Employees Association.

North Dakota DES Action.

North Dakota Clean Water Action.

Dakota Center for Independent Living.

North Dakota Breast Implant Coalition.

North Dakota Progressive Coalition.

Laborer’s International Union, Local 580.

Boilermaker’s Local 647.

Ironworkers Local 793.

United Transportation Union.

Sierra Club, Agassiz Basin Group.

Plumbers & Pipefitters Local 338.

United Church of Christ.

Teamsters Local 116.

Teamsters Local 123.

Plumbers & Pipefitters, Local 795.

Workers Against Inhumane Treatment.

Ohio Consumer League.

Oregon Fair Share.

Oregon Consumer League.

Pennsylvania Citizens Consumer Council.

Pennsylvania Institute for Community

Services.

SmokeFree Pennsylvania.

South Dakota AFSCME.

East River Group Sierra Club.

Black Hills Group Sierra Club.

South Dakota State University.

IBEW, Local 426.

South Dakota DES Action.

South Dakota Peace & Justice Center.

Native American Women’s Health & Education Center.

Native American Women’s Reproductive

Rights Coalition.

South Dakota AFL–CIO.

UFCW Local 304A.

Yankton Sioux Tribe.

South Dakota Coalition Against Domestic

Violence.

South Dakota Advocacy Network.

South Dakota United Transportation

Union.

South Dakota United Paperworkers International Union.

Texas Alliance for Human Needs.

Texas Public Citizen.

Vermont PIRG.

WASHPIRG (Washington Public Interest

Research Group).

Wisconsin PIRG.

CITIZEN ACTION,

Montgomery, AL, April 26, 1995.

Hon. RICHARD SHELBY,

U.S. Senate,

Washington, DC.

DEAR SENATOR SHELBY: On behalf of our

members, I am writing to thank you for your

past opposition to federal ‘‘tort reform’’ legislation and to offer our support in your efforts this year.

As you know, Governor Fob James, in his

April 18th State of the State Address, stated

that ‘‘intrusive federal law should not dictate tort reform legislation to the states.’’

You might also be interested to know that

similar sentiments have been reflected by

the majority of audiences in several forums

I have attended on the issued in the past

month.

Our members also are deeply concerned

about the consequences of capping punitive

damages and eliminating joint and several

liability for non-economic damages. Proposals such as these threaten public safety in

Alabama by removing the deterrent effect of

punitive damages, and they discriminate

against those most likely to suffer non-economic damages, such as women, seniors, and

children.

Thank you again for your leadership in

fighting to uphold the democratic principles

embodied in our state civil justice system

and for voting ‘‘no’’ on the upcoming cloture

votes on S. 565. Please do not hesitate to call

on me for any assistance on this matter in

the coming weeks.

Sincerely yours,

MIKE ODOM,

Executive Director.

ARIZONA CONSUMERS COUNCIL,

Phoenix, AZ, April 19, 1995.

Senator JOHN MCCAIN,

Russell Office Building,

Washington, DC.

DEAR SENATOR MCCAIN: Two bills are expected to come to the floor this week—The

Telecommunications Competition and Deregulation Act of 1995, and the Product Liability Fairness Act of 1995. We believe that

these bills are both anti-consumer and anticompetitive.

Consumers have been strong in their requests to continue regulation of cable and in

feeling that their bills have gone too high—

three times the rate of inflation—for this

service. Reregulation was the ONLY bill

which was passed over the veto of President

Bush.

Your office asked me to represent you on

KFYI in favor of reregulation at that time. I

did my best on that program.

Local cable companies now have a network

which pass 96% of the homes in the country.

They are best positioned to compete with the

monopoly local telephone companies. This

bill would permit these local monopolies to

buy each other, merge or joint venture, thus

eliminating the most likely competitor in

each market. This means the promised benefits of competition, including lower prices,

greater innovation and better service may

never be realized by most consumers.

S. 565 sets arbitrary limits on punitive

damages and eliminates joint and several liability for non-economic damages. This bill

will restrict the ability of injured consumers

to obtain full and fair compensation for their

injuries, and for juries to act to prevent further wrongdoing.

The Arizona Consumers Council which represents consumers in all countries of the

state and was organized in 1966 is also a

member of Consumer Federation of America,

who represent 50 million consumers nationwide, we urge you to opposed S. 652. and also

S. 565.

Sincerely,

PHYLLIS ROWE,

President.

CONSUMER FEDERATION

OF CALIFORNIA,

Westminster, CA, April 18, 1995.

Re Opposition to S. 565 and S. 454.

Senator BARBARA BOXER,

U.S. Senate,

Washington, DC.

DEAR SENATOR BOXER: On behalf of the

Consumer Federation of California, I wish to

express strong opposition to S 565, the

‘‘Product Liability Fairness Act of 1995.’’ Injured consumers would not be able to obtain

full and fair compensation if this legislation

is passed.

The two major provisions of this legislation would have a far reaching, negative impact on consumers and workers. First, this

bill would set arbitrary limits on punitive

damage awards of $250,000 or three times economic damages, reducing the ability to deter

corporations from inflicting harm on others

and threatening Americans’ economic security and well being. At a time when Congress

is talking about increasing personal responsibility, it makes no sense to reduce the responsibility of corporations guilty of manufacturing or selling dangerous products.

Second, this bill would eliminate joint and

several liability for noneconomic damages,

making it difficult for consumers to recover

costs related to injuries such as the loss of

reproductive capacity, loss of sight, or disfigurement. Those injuries deserve to be

compensated and should not be treated as

less important than the loss of high salaries

or investment income.

Consumer Federation of California also

urges you to oppose S. 454, ‘‘The Health Care

Liability and Quality Assurance Act’’ which

would severely affect the rights of injured

patients.

I urge you to act to prevent passage of this

legislation, which would greatly restrict the

ability of the consumer to be compensated

fully for injuries and to act to prevent further wrong doing.

Sincerely,

Dr. REGENE L. MITCHELL,

President.

MOTOR VOTERS,

Sacramento, CA, April 19, 1995.

Re S. 565: Oppose.

Hon. DIANE FEINSTEIN,

U.S. Senate,

Washington, DC.

DEAR SENATOR FEINSTEIN: Motor Voters is

a non-profit, non-partisan auto safety organization founded in Lemon Grove, outside

San Diego, in 1979.

This letter is to urge you to oppose S. 565,

the product liability measure. Our members

include parents of children who suffered permanent, debilitating brain injuries or who

were killed due to the deliberate disregard of

auto manufacturers.

It would be impossible to tell you how

strongly those parents feel that companies

need to be held accountable for their actions.

In fact, they wish to see the law strengthened to provide for felony criminal penalties

for corporate executives who knowingly market unsafe products.

Corporate executive are too insulated from

the damage they inflict upon their customers and the public at large. If they were

more personally accountable, it would provide a desperately needed incentive for them

to consider more than their bottom line.

In the absence of criminal penalties, the

only hope we have of curbing rampant corporate misconduct is through product liability laws. It is appalling that special interests

are seeking to restrict remedies in consumers’ court of last resort. The ‘‘loser pays’’

concept is particularly pernicious, as it entirely ignores the unequal footing of the two
S6378 CONGRESSIONAL RECORD — SENATE May 10, 1995

parties. Individuals already risk a great deal

when they sue a giant corporation, and experience tremendous stress. A family with a

brain-injured child has enough to worry

about without the danger that, if their attorney makes a mistake, they can be totally

impoverished.

Ironically, many advances in safety technology, spurred by lawsuits, end up benefiting everyone—including companies. For example, here in California, many former defense contractors are converting to making

auto safety components such as air bags. The

demand for improved safety is spawning an

entire new industry and creating new, hightech jobs. It is time to move forward, not

back.

For all of the above reasons, I urge your

‘‘no’’ vote on S. 565.

Sincerely,

ROSEMARY SHAHAN,

President.

CALIFORNIA PUBLIC INTEREST

RESEARCH GROUP,

Los Angeles, CA, April 24, 1995.

Protect Victims of Dangerous Products—Oppose Cloture and Vote ‘‘No’’ on S. 565.

Hon. DIANNE FEINSTEIN,

U.S. Senate,

Washington, DC.

DEAR SENATOR FEINSTEIN, We are writing

on behalf of CALPIRG’s members, and on behalf of all residents of California to urge

your strong opposition to proposed legislation, S. 565, that would eviscerate the rights

of victims of dangerous and defective products. As you know, CALPIRG is a statewide,

non-profit, nonpartisan consumer and environmental advocacy group that has fought

to protect the rights of consumers for many

years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

MARY RAFTERY,

Legislative Director.

COALITION FOR

ACCOUNTABILITY & JUSTICE,

April 21, 1995.

Hon. BEN NIGHTHORSE CAMPBELL,

U.S. Senate,

Washington, DC.

DEAR SENATOR CAMPBELL: We, the undersigned individuals and organizations, urge

you to oppose efforts to weaken America’s

civil justice system. We urge you to vote

against cloture on S. 565, the product liability measure sponsored by Sens. Gorton and

Rockefeller, or any other legislation that

would weaken the rights of the citizens of

Colorado.

By restricting the rights of victims of dangerous and defective products, this measure

undermines the role of the civil justice system in redressing damages and deterring

harmful behavior. By giving ‘‘non-economic’’

damages second-class treatment, the bill discriminates against populations with less

earning power, specifically women, children,

seniors and low- and middle-income workers.

Under S. 565, the U.S. would have a two-tier

system of justice where rich, high-salaried

workers would be accorded better treatment

and higher damage awards than the rest of

us. Finally, by establishing brand new federal rules for product liability cases, S. 565

removes from state authority and oversight

a civil justice system that, despite the hyperbole of the big business interests backing

this legislation, has served consumers and

the residents of Colorado exceedingly well.

S. 565 is far more restrictive than last

year’s Senate product liability bill. First and

foremost, the bill establishes a cap on punitive damages of three times economic loss,

or $250,000, whichever is greater. Under this

cap, corporations will be punished more if

they injure or kill a corporate executive

than if the same conduct harms a child, a

senior citizen, or a schoolteacher. How can

this be fair? In addition, the bill establishes

a 20 year limit on lawsuits for capital

goods—in last year’s bill, the limit was 25

years. Moreover, S. 565 adds protection for

manufacturers of raw materials in medical

devices and for rental car companies, and reduces manufacturer liability for misuses or

alterations made to the product by anyone

else—provisions that were not in last year’s

bill. Even if one reasonably believes that the

measure introduced by Sens. Gorton and

Rockefeller is sound public policy (which we

do not), it must ultimately be reconciled

with the extreme revisions to the civil justice system recently adopted by the House of

Representatives. H.R. 956, in addition to the

provisions outlined above, enacts an arbitrary cap on pain and suffering awards in

medical malpractice and cases involving

drugs and medical devices, at the same time

it offers an automatic punitive damages

shield for products that have received FDA

approval. In addition, the House measure extends the cap on punitive damages to all

civil lawsuits, and establishes an arbitrary 15

year statute of repose for product liability

cases.

Passage of either of these measures, or a

combination of the two, would cause grievous harm to the people who have elected

you—and depend on you—to represent their

interests in Congress. We urge you to oppose

any effort to weaken or federalize product liability laws, and to vote ‘‘no’’ on cloture on

S. 565, on S. 565, and on any conference committee reported-measure restricting the

rights of consumers.

Sincerely,

Julie Shiels, Son killed by defective

bunkbed; International Steelworkers

Union, Local 2102; Coalition of Silicon

Survivors; DES Action, Colorado Chapter; Denver United Auto Workers;

ACLU of Colorado; Gray Panthers of

Denver; Colorado Public Interest Research Group (CoPIRG); Clean Water

Action, Colorado Chapter; Ann Ives,

Silicon breast survivor, DES survivor;

Oil, Chemical & Atomic Worker International Union, AFL–CIO; Colorado

Senior Lobby.

COLORADO PUBLIC INTEREST

RESEARCH GROUP,

Denver, CO, April 24, 1995.

Re Protect Victims of Dangerous Products—

Oppose Cloture and Vote No. on S. 565.

Hon. BEN NIGHTHORSE CAMPBELL,

U.S. Senate,

Washington, DC.

DEAR SENATOR NIGHTHORSE CAMPBELL: We

are writing on behalf of COPIRG’s members,

and on behalf of all residents of Colorado to

urge your strong opposition to proposed legislation, S. 565, that would eviscerate the

rights of victims of dangerous and defective

products. As you know, COPIRG is a statewide, non-profit, nonpartisan consumer and

environmental advocacy group that has

fought to protect the rights of consumers for

many years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

RICHARD MCCLINTOCK,

Executive Director.

CONNECTICUT PUBLIC INTEREST

RESEARCH GROUP,

Hartford, CT, April 24, 1995.

Re Protect Victims of Dangerous Products—

Oppose Cloture and Vote ‘‘No’’ on S. 565

Hon. CHRIS DODD,

U.S. Senate

Washington, DC.

DEAR SENATOR DODD: We are writing on behalf of ConnPIRG’s members, and on behalf

of all residents of Connecticut to urge your

strong opposition to proposed legislation, S.

565, that would eviscerate the rights of victims of dangerous and defective products. As

you know, ConnPIRG is a statewide; nonprofit, nonpartisan consumer and environmental advocacy group that has fought to

protect the rights of consumers for many

years.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6379

1For identification purposes only. Endorsements

are by the individual, not the organization.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its cap on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

JAMES AMSPACHER,

Organizing Director.

CONNECTICUT CITIZEN

ACTION GROUP,

West Hartford, CT.

Senator CHRISTOPHER DODD,

Senate Office Building,

Washington, DC

DEAR SENATOR DODD: On behalf of the Connecticut Citizen Action Group, I’m asking

you to oppose Senate Bill 565 and to vote

against cloture. S. 565, called the ‘‘Product

Liability Fairness Act’’ does nothing to protect consumers. Instead, it lets corporate

wrongdoers off the hook when they produce

products that injure consumers.

First, this bill sets arbitrary caps on punitive damages of $250,000 or three times the

out-of-pocket expenses. Ordinary citizens

serving on juries use these awards to punish

and deter outrageous and dangerous behavior

by corporations.

Second, this bill makes it more difficult

for victims with less earning power—particularly seniors, women and children—to recover the fair cost of their injuries. Consumers and workers injured through no fault of

their own, but by the actions of more than

one wrongdoer would have to prove the degree of fault of each liable party. If any

wrongdoer were unable to pay its share, the

injured consumer would have to bear the

cost.

Senator Dodd, these reforms are wrongminded. They imperil ordinary consumers

and we ask that you work to defeat such

measures. Again, please vote against S. 565

and against cloture.

GREGORY HADDAD,

Legislative Director.

DELAWARE COALITION FOR

ACCOUNTABILITY AND JUSTICE,

April 24, 1995.

Hon. WILLIAM ROTH,

Hon. JOSEPH BIDEN,

U.S. Senate,

Washington, DC.

DEAR SENATORS: We, the undersigned individuals and organizations, urge you to oppose efforts to weaken America’s civil justice system. We urge you to vote against cloture on S. 565, the product liability measure

sponsored by Sens. Gorton and Rockefeller,

or any other legislation that would weaken

the rights of the citizens of Delaware.

By restricting the rights of victims of dangerous and defective products, this measure

undermines the role of the civil justice system in redressing damages, and deterring

harmful behavior. By giving ‘‘noneconomic’’

damages second-class treatment, the bill discriminates against populations with less

earning power, specifically women, children,

seniors and low- and middle-income workers.

Under S. 565, the U.S. would have a twotiered system of justice where rich, high-salaried workers would be accorded better

treatment and higher damage awards than

the rest of us. Finally, by establishing brand

new federal rules for product liability cases,

S. 565 removes from state authority and

oversight a civil justice system that, despite

the hyperbole of the big business interests

backing this legislation, has served consumers and the residents of Delaware exceedingly well.

S. 565 is far more restrictive than last

year’s Senate product liability bill. First and

foremost, the bill establishes a cap on punitive damages of three times economic loss,

or $250,000, whichever is greater. Under this

cap, corporations will be punished more if

they injure or kill a corporate executive

than if the same conduct harms a child, a

senior citizen or a schoolteacher. How can

this be fair? In addition, the bill establishes

a 20 year limit on lawsuits for capital

goods—in last year’s bill, the limit was 25

years. Moreover, S. 565 adds protections for

manufacturers of raw materials in medical

devices and for rental car companies, and reduces manufacturer liability for misuse or

alterations made to the product by anyone

else—provisions that were not in last year’s

bill.

Even if one reasonably believes that the

measure introduced by Sens. Gorton and

Rockefeller is sound public policy (which we

do not), it must ultimately be reconciled

with the extreme revisions to the civil justice system recently adopted by the House of

Representatives. H.R. 959, in addition to the

provisions outlines above, enacts an arbitrary cap on pain and suffering awards in

medical malpractice and cases involving

drugs and medical devices, at the same time

it offers an automatic punitive damages

shield for products that have received FDA

approval. In addition, the House measure extends the cap on punitive damages to all

civil lawsuits, and establishes an arbitrary 15

year statute of repose for product liability

cases.

Passage of either of these measures, or a

combination of the two, would cause grievous harm to the people who have elected

you—and depend on you—to represent their

interests in Congress. We urge you to oppose

any effort to weaken or federalize product liability laws, and to vote ‘‘no’’ on cloture on

S. 565, on S. 565, and on any conference committee reported-measure restricting the

rights of consumers.

Sincerely,

Edward Cahill, State Director, Delaware

AARP; Edward Peterson, President,

Delaware AFL–CIO; Deirdre O’Connoll,

Executive Director, Women and

Wellness; Rick Crawford, President,

Building Trades Council of Delaware;

Debbie Heaton, President, Delaware Sierra Club; Til Purnell, Executive Director, Save Wetlands and Bays; Amos

McCluney, Jr., President, Delaware

Council of Senior Citizens; May Northwood, President, Delaware Federation

of Women’s Clubs;1 Maureen

Lauterbach, Women and Wellness and

National Breast Cancer Coalition;1 Don

Cordell, President, United Auto Workers Local 1183; Ann Rydgren, President,

Delaware Audubon Society.

CONSUMER FRAUD WATCH,

Tallahassee, FL, April 19, 1995.

Senator CONNIE MACK,

U.S. Senate,

Washington, DC.

DEAR SENATOR MACK: I want to express our

strong opposition to S. 565, the ‘‘Product Liability Fairness Act of 1995’’. This bill would

restrict the ability of injured consumers to

obtain full and fair compensation and for citizen juries to impose adequate deterrents to

prevent further injuries.

There are two major provisions of this legislation which would have a negative effect

on consumers and workers. First, this bill

would set arbitrary limits on punitive damage awards of $250,000 or three times economic damages, reducing the ability to deter

corporations from inflicting harm on others

and threatening Americans’ economic security and well-being. At a time when Congress

is talking about increasing personal responsibility, it makes no sense to reduce the responsibility of corporations guilty of manufacturing or selling dangerous products.

Second, this bill would eliminate joint and

several liability for non-economic damages,

making it difficult for consumers to recover

costs related to injuries such as the loss of

reproductive capacity, loss of sight, or disfigurement. Those injuries deserve to be

compensated and should not be treated as

less important than THE loss of high salaries

or investment income. For similar reasons as

those described, CFA also urges you to oppose S. 454, ‘‘The Health Care Liability and

Quality Assurance Act’’ which would severely affect the rights of injured patients.

I urge you to act to prevent passage of this

legislation, which would greatly restrict the

ability of injured consumers to be compensated fully and for juries to act to prevent further wrongdoing.

Sincerely,

WALTER T. DARTLAND,

Executive Director.

FLORIDA CONSUMER ACTION NETWORK,

Tallahassee, FL, April 24, 1995.

Senator BOB GRAHAM,

Hart Senate Office Building,

Washington, DC.

DEAR SENATOR GRAHAM: The Florida

Consumer Action Network (FCAN) is requesting that you vote ‘‘NO’’ on Senate Bill

565, the Product Liability Bill. Additionally,

we are asking you to vote against cloture. If

this bill passes, it will have a devastating effect on the more than 40,000 families that are

members of FCAN and on all Florida consumers.

By capping punitive damages at $250,000 or

three times the economic loss (whichever is

greater) the legislation removes the punitive

impact from punitive sanctions, rendering

them meaningless as punishment in most

cases. It will be cheaper for many corporations to pay such damages rather than rectify their faulty products.

Eliminating joint and several liability for

non-economic damages saddles the victim

for the costs of damages incurred by the

wrongdoing parties. It is unjust and particularly discriminatory for women, children and

senior citizens.

Obviously this bill is not in the best interest of Florida’s consumers. We again ask for
S6380 CONGRESSIONAL RECORD — SENATE May 10, 1995

your vote against S. 565 and against cloture

in the upcoming debate.

Sincerely,

MONTE E. BELOTE,

Executive Director.

FLORIDA PIRG,

FLORIDA PUBLIC INTEREST RESEARCH

GROUP,

Tallahassee, FL, April 24, 1995.

Re Protect Victims of Dangerous Products,

Oppose Cloture and Vote No on S. 565.

Hon. BOB GRAHAM,

U.S. Senate,

Washington, DC.

DEAR SENATOR GRAHAM: We are writing on

behalf of Florida PIRG’s members, and on

behalf of all residents of Florida to urge your

strong opposition to proposed legislation, S.

565, that would eviscerate the rights of victims of dangerous and defective products. As

you know, Florida PIRG is a statewide, nonprofit, nonpartisan consumer and environmental advocacy group that has fought to

protect the rights of consumers for many

years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on

S. 565, against S. 565 and against any conference measure restricting the rights of

consumers. We look forward to hearing your

views on this important legislation. Please

contact me if you or your staff have any

questions.

Sincerely,

ANN WHITFIELD,

Executive Director.

CITIZEN ACTION,

Atlanta, GA, April 18, 1995.

Hon. PAUL COVERDELL,

Russell Senate Office Building,

Washington, DC.

DEAR SENATOR COVERDELL: On behalf of the

40,000 members of Georgia Citizen Action, I

am writing to express our opposition to

S. 565 and to urge you to vote against cloture.

S. 565, the Product Liability Fairness Act

of 1995, is anything but fair to consumers. In

fact, it will effectively leave citizens unprotected against the manufacture and sale of

hazardous or defective products. Capping punitive damages at $250,000 or three times economic loss defeats the purpose of punitive

damages, which is to punish for a wrongdoing. Multi-million dollar corporations will

consider these caps merely the cost of doing

business, rather than a punishment for injuring unsuspecting consumers, and consequently, punitive damages will no longer

serve as a deterrent to irresponsible and unscrupulous companies who would manufacture or sell harmful products.

Additionally, the provisions to eliminate

joint and several liability for non-economic

damages discriminates against women, children, and senior citizens as they are less

likely to recover high economic damages

(i.e. lost wages). Joint and several liability

ensures that the parties at fault pay, not the

victim, and by eliminating this, those victims who suffer loss of reproductive capacity, disfigurement, or loss of sight, for example, could be further wronged by not being

able to recover the full amount of their

awarded damages.

For these reasons, Georgia Citizen Action

strongly urges you to oppose S. 565 and to

vote against cloture. Please inform us of

your actions regarding this bill.

Sincerely,

LORI GLIDEWELL,

Director.

CITIZEN ADVOCACY CENTER,

Elmhurst, IL, April 20, 1995.

Hon. CAROL MOSELEY-BRAUN,

U.S. Senate,

Washington, DC.

DEAR SENATOR MOSELEY-BRAUN: The Citizen Advocacy Center, a non-partisan, notfor-profit organization in DuPage County, is

dedicated to building democracy for the 21st

century. We promote good citizenship, participation in civic affairs, access to justice,

and accountability of local governments to

the citizens of the western suburbs of Chicago. We are writing to urge you to vote

‘‘no’’ both on the upcoming cloture vote of S.

565, and the vote on the merits. We oppose

any legislation that makes access to justice

more difficult for individual citizens.

As you know Senator Braun, the large

crossover vote in the western suburbs of Chicago, particularly the crossover vote of

women, helped to elect you to represent our

interests in the United States Senate. We expect you to make access to justice easier,

not more difficult, for consumers viciously

injured by defective products. The provisions

of S. 565 are an undisguised attempt to take

control and common sense away from Illinois citizens in the jury box and to replace it

with Washington-dictated arbitrariness designed to protect and payback the business

interests that have paid so handsomely for

this legislation. In particular, we find the

provisions of S. 565 do great damage to

women—and as one of the few women Senators, we frankly expect you to take a good

hard look at how the specific provisions of

this bill will prevent women with low economic damage awards from being adequately

compensated for lifelong injuries caused by

corporate greed.

Moreover, after last Sunday’s Chicago

Tribune Magazine cover story, it seems that

you are burnishing your business image after

having recently secured a seat on the Finance Committee. Nonetheless, Illinois voters remember that last year you voted

against a less damaging products liability

bill, and a flip-flop vote now will look like

you are selling out ordinary citizens and

consumers to cozy up to business interests.

We are happy that you have won a seat on

the committee, but we expect you to use

that seat to remain true to the agenda that

put you in the Senate in the first place.

Please do not sell out the citizens of Illinois.

Very truly yours,

THERESA AMATO,

Executive Director,

Citizen Advocacy Center.

CHICAGO AND CENTRAL STATES JOINT

BOARD, ACTWU, AMALGAMATED

CLOTHING AND TEXTILE WORKERS

UNION,

Chicago, IL, March 31, 1995.

Senator CAROL MOSELEY-BRAUN,

U.S. Senate,

Washington, DC.

DEAR SENATOR MOSELEY-BRAUN: On behalf

of the members of our union we urge you to

vote against consideration of any legislation

that lessons the financial responsibility of

corporate polluters or manufacturers of dangerous products. These, so called, efforts at

‘‘tort reform’’ are more aptly known as the

Wrongdoer Protection Act.

Furthermore, these attempts at reform are

plainly anti-workers and anti-consumer.

Your opposition to the more onerous parts

of these tort reforms proposals is not

enough. Your leadership is needed to stop

passage of any restrictions limiting the access of consumers and workers to the courts.

Your leadership against these tort restrictions can send a positive signal that you

stand on the side of workers and consumers.

Sincerely,

JAMES K. TRIBBLE,

International Vice

President.

RONALD WILLIS,

Manager, ACTWU,

Chicago and Central

States Joint Board.

PUBLIC ACTION,

Chicago, IL, April 24, 1995.

Senator CAROL MOSELEY-BRAUN,

U.S. Senate,

Washington, DC.

DEAR SENATOR MOSELEY-BRAUN: Illinois

Public Action is requesting that you vote

‘‘NO’’ on Senate Bill 565. Additionally we are

asking you to vote against cloture. If this

bill passes, it will have a devastating effect

on the 215,000 families that are members of

Public Action and on all Illinois consumers.

By capping punitive damages at $250,000 or

three times the economic loss (which ever is

greater), the legislation removes the punitive impact from punitive sanctions, rendering them meaningless as punishment in most

cases. It will be cheaper for many corporations to pay such damages than rectify their

faulty products.

Eliminating joint and several liability for

non-economic damages saddles the victim

for the costs of the damages incurred by the

wrongdoing parties. It is unjust and particularly discriminatory for women, children and

senior citizens.

Obviously this bill is not in the best interest of the Illinois public. We again ask for

your vote against the bill and against cloture in the coming debate.

Sincerely,

ROBERT B. CREAMER,

Executive Director.

ILLINOIS PIRG, Illinois Public

INTEREST RESEARCH GROUP,

Chicago, IL, April 24, 1995.

Re: Protect Victims of Dangerous Products,

Oppose Cloture and Vote No on S. 565.

Hon. CAROL MOSELEY-BRAUN,

U.S. Senate,

Wshington, DC.

DEAR SENATOR MOSELEY-BRAUN: We are

writing on behalf of Illinois PIRG’s members, and on behalf of all residents of Illinois

to urge your strong opposition to proposed

legislation, S. 565, that would eviscerate the

rights of victims of dangerous and defective

products. As you know, Illinois PIRG is a

statewide, non-profit, nonpartisan consumer

and environmental advocacy group that has
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6381

fought to protect the rights of consumers for

many years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

DIANE BROWN,

Executive Director.

IOWA CITIZEN

ACTION NETWORK,

Des Moines, IA, April 14, 1995.

Hon. TOM HARKIN,

U.S. Senate, Hart Senate Office Building,

Washington, DC.

DEAR SENATOR HARKIN: We are writing to

communicate ICAN’s views about the socalled Products Liability ‘‘Fairness’’ Act—S.

565. It is our understanding that S. 565 is set

for two weeks of debate on the Senate floor,

beginning on or about April 24.

We are pleased that you have indicated

that, as in the past, you will lead the fight

against this legislation. We heartily commend your determination to use all means

available to keep the bill from coming to a

vote on final passage.

S. 565 is a bill that would produce extremely detrimental consequences for citizens, workers, and consumers. There are a

number of objectionable provisions in the

legislation, but for the purposes of this letter

we would like to focus on provisions relating

to joint and several liability and punitive

damages.

As you know, S. 565 eliminates joint and

several liability for non-economic damages.

This clearly discriminates against women,

children, senior citizens, persons with disabilities, the poor, and low-wage workers,

who more often receive the bulk of compensation for their injuries due to sustained

non-economic losses, such as loss of reproductive capacity, loss of vision, disfigurement, etc. S. 565 treats these first rate members of society as second class citizens.

Under current Iowa law, in cases where

more than one party is found to have been at

fault in causing a plaintiff’s injuries, a

guilty party that caused more than 50% of

the harm can be held jointly and severally

liable for damages. S. 565 would supersede

Iowa law, making it more likely that injured

parties would be forced to forego amounts of

compensation for their non-economic losses

when one or more of the defendants are unable to pay. This Washington-Knows-Best

bill reshuffles the cards and stacks the deck

against plaintiffs in Iowa.

S. 565 also imposes an arbitrary and unreasonable cap on punitive damages that would

undermine the important deterrent effect

which these damages have on corporate

wrongdoers. This is unnecessary and rash in

light of the fact that punitive damages in

product liability cases are rare but have

made Americans much safer.

The bill limits punitive damage judgments

to the greater of three times the amount of

economic losses or $250,000. Once again, this

provision is a slap in the face to women, children, senior citizens, persons with disabilities, the poor, and low-wage workers. And

the provision sends a warped message to corporate wrongdoers: If you injure a woman, a

child, an elderly grandparent, a disabled person, or a minimum wage worker, you are

likely to be punished less than if you injure

a corporate CEO. The consequences of such a

legal policy would be lethal to many average

Americans.

In addition, S. 565 imposes an unreasonable

standard of ‘‘conscious flagrant indifference

to safety’’ for assessment of punitive damages. A defendant whose conduct was merely

‘‘reckless’’ or ‘‘wanton’’ would escape punitive damages. If the superheightened punitive damage standards in S. 565 had applied

to the Exxon-Valdez case, Exxon would probably not have paid a dime in punitive damages since the punitive damages were awarded for ‘‘reckless’’ conduct. Moreover, proving

a corporate defendant’s ‘‘state of mind’’

would be next to impossible in most product

liability cases.

S. 565 is imprudent and unwarranted legislation. Product liability tort filings make up

an extremely small percentage of all civil filings and the number of product liability filings has been steadily declining. We are mobilizing concerned citizens in Iowa to oppose

this bogus bill.

We are grateful for your leadership in opposing this legislation. Please let us know

whether and how we can provide any information or assistance to support your efforts.

Your commitment to civil justice for all

Americans is greatly appreciated.

Respectfully,

STEVE SIEGEL/BL

President.

BRAD LINT,

Executive Director.

UAW SUB-REGIONAL OFFICE

REGION 4,

Des Moines, IA, April 20, 1995.

Hon. TOM HARKIN,

U.S. Senate,

Washington, DC.

DEAR SENATOR HARKIN: On behalf of the

UAW men and women who live, work, and

vote in Iowa, I am writing to express our opposition to S. 565—the so-called Products Liability ‘‘Fairness’’ Act. This legislation is

grossly unfair and one-sided.

S. 565 would, without a doubt, take away

the right of workers to hold large corporations fully accountable for the injuries they

cause when they manufacture and sell defective products—including dangerous workplace machinery. Employers claims, however, appear to be unaffected by the law—

only workers would lose their right to be

heard.

S. 565 sets up a series of hurdles and obstacles to the ability of injured workers and

consumers to recover from the manufacturers of defective products. In fact, under the

bill’s statute of repose, workers injured by

defective machinery more than twenty years

old could not recover at all, but businesses

apparently could recover all their losses—including lost profits.

S. 565 would also cap punitive damages far

below the point of effectiveness. If the bill

becomes law it would be much more difficult

for ordinary Iowans to punish and deter corporate misbehavior, even when they are

maimed or killed by the recklessness or negligence of a corporation.

In summary, S. 565 is unfair to workers and

consumers. The UAW is delighted that you

will be voting against cloture during debate

and, if needed, against the bill on final passage.

Thank you for your firm commitment to

civil justice for workers and consumers.

Respectfully,

CHUCK GIFFORD,

President.

IOWA STATE COUNCIL

OF SENIOR CITIZENS,

Waterloo, IA, April 20, 1995.

Hon. TOM HARKIN,

Hart Senate Office Building,

Washington, DC.

DEAR SENATOR HARKIN: I am writing to express our concern about S. 565—the so-called

Products Liability ‘‘Fairness’’ Act. The Iowa

State Council of Senior Citizens believes the

bill to be unfair to senior citizens and we are

grateful for your announced opposition to it.

It is my understanding that S. 565 eliminates joint and several liability for non-economic losses. Senior citizens do not generally incur substantial economic losses

when they are injured by defective products.

They tend to receive compensation for noneconomic losses resulting from disfigurement, loss of vision, pain and suffering, etc.

Under S. 565 when multiple parties are

found to have caused the harm to an injured

consumer the amount of compensation for

non-economic losses would, without exception, be reduced when one or more of the atfault parties is unable to pay. This situation

would be worse than current Iowa law where

injured consumers can at least recover noneconomic damages jointly and severally

whenever one of the parties at fault is more

than 50% responsible for the harm caused to

the injured consumer.

It is also my understanding that S. 565 limits punitive damages in product liability

cases to the greater of three times the

amount of economic losses or $250,000. This

provision also discriminates against senior

citizens. Again, since seniors do not usually

have large economic losses, corporate wrongdoers who injure a senior are likely—if their

misconduct was bad enough to warrant punitive damages—to be punished less than if

they injure a corporate executive who has

large earnings. Is this wise legal policy?

The Iowa State Council of Senior Citizens

believes that, taken together, these two discriminatory provisions could lead to less

safe medical devices and consumer products

primarily manufactured for use by senior

citizens. Women, children, disabled persons,

and low-wage workers are also likely to be

adversely affected by these ill-conceived provisions.

S. 565 could have a devastating effect on

the economic security and safety of older

Iowans. The Iowa State Council Citizens is

glad you will oppose S. 565 during the coming

Senate debate by voting against cloture and,

if necessary, against the bill.

Thank you for your considerate attention

to our point of view. Please let us know if we

can be of any further assistance.

Respectfully,

FRANK ALEXANDER,

President.
S6382 CONGRESSIONAL RECORD — SENATE May 10, 1995

CITIZEN ACTION,

Louisville, KY, March 14, 1995.

Hon. MITCH MCCONNELL,

U.S. Senate, Senate Russell Office Building,

Washington, DC.

DEAR SENATOR MCCONNELL: On behalf of

Kentucky Citizen Action, I would like to express our strong opposition to the so-called

‘‘Product Liability Fairness Act’’, S. 565. I

urge you to vote against efforts to pass this

legislation, as it is anything but fair to your

constituents or to any individual American

citizen.

While the proponents of this bill have attempted to cast a ‘‘moderate’’ light on the

legislation, painting it as more fair and equitable than proposed legal reforms which

came before it, our careful study from the

consumer’s perspective has revealed that it

is neither fair nor equitable to real Americans. Areas of particular concern include:

Punitive damage caps of $250,000 or three

times the economic loss. Imposing such caps

completely undermines the important deterrent effect which these damages have on corporate wrongdoing. While punitive damages

are rarely used, the very threat that their

existence presents has proven to be critical

in persuading manufacturers to improve the

safety of their products or in actually removing unsafe products from the marketplace. If you undermine this system, American consumers truly will be at the mercy of

big business.

Elimination of joint and several liability

for non-economic damages. This provision

discriminates against the most vulnerable

members of our society—women, children,

seniors, the poor—whose form of compensation would most likely be in the form of noneconomic damages. This legislation says

that only the wealthy should be empowered

to hold wrongdoers accountable for their

egregious behavior. These damages also

cover a great deal more than just pain and

suffering, as is often thought. They also

cover loss of reproductive capacity, loss of

sight, and disfigurement. Is it fair to punish

individuals who have suffered these tragedies?

S. 565 is not fair, although its name attempts to imply otherwise. It is not fair to

the workers, to women, to children, to the

real people of this country. It is a one-sided,

unjustified and cynical attempt to provide a

subsidy to big business at the expense of the

American consumer.

We understand that S. 565 will be brought

to the floor on Monday, April 25 and a vote

on cloture could come within a few days of

this. We urge you to cast your vote on behalf

of your constituents and all American citizens and oppose S. 565 by voting ‘‘No’’ on cloture.

Sincerely,

LORI EVERHART,

State Director.

CITIZEN ACTION,

Baton Rouge, LA, April 14, 1995.

Hon. JOHN BREAUX,

U.S. Senate,

Washington, DC.

DEAR SENATOR BREAUX: On behalf of our

members, your constituents, Louisiana Citizen Action once again asks that you vote

‘‘No’’ on S. 565 and ‘‘No’’ on cloture. We

strongly believe that it is your responsibility

to hold negligent businesses accountable to

the public.

By setting caps on punitive damages, S. 565

would send a clear message that corporations do not really have to worry about liability for dangerous products and practices.

Punitive damages, after all, were meant to

be deterrents to corporate misconduct.

This law, which favors the financial interests of big business over protecting the public, is especially threatening to the most vulnerable—women, children, and seniors.

Elimination of joint and several liability for

non-economic damages deeply undervalues

the impact of injuries upon these citizens.

Please take a firm stand to support fairness and responsibility in our judicial system. We will be happy to inform our members when you vote no to S. 565 and no to cloture. Thank you for your consideration on

this issue.

Sincerely,

PAULA HENDERSON,

State Director.

MAINE PEOPLE’S ALLIANCE.

April 21, 1995.

Senator OLYMPIA SNOWE,

Russell Senate Office Building,

Washington, DC.

DEAR SENATOR SNOWE: As you know, debate will begin next week on the Rockefeller-Gorton Bill (S. 565). We wanted to

write you in hopes that with your concern

for the citizens of Maine—particularly

women, children and other economically underprivileged—you will join with us in opposition to that bill. The Contract With America effort is bulldozing ahead with legal reforms that only benefit the manufacturers of

defective products.

The bill’s supporters claim it is designed to

reduce the ‘‘explosion’’ of product liability

lawsuits, but there is no evidence suggesting

that such a problem exists. In fact, close

study of 30 years of case law in Maine reveals

that punitive damages have been awarded in

only three cases. At $250,000, companies will

not be deterred and will simply write the

cost of a punitive damage award into the

cost of doing business.

An especially worrisome provision of this

bill will be the elimination of joint and several liability for non-economic damages.

Since women, seniors, and children are more

likely to suffer non-economic injuries than

high economic injuries (e.g. lost wages), the

elimination of joint and several liability discriminates against them. This provision basically states that corporations which manufacture child car seats or children’s pajamas

can be less careful than manufacturers of

golf carts.

As you know, our organization has differed

with you on some issues in the past, however

we know that you will join with us in opposing this tort reform effort. The notion of

Federal Legislation that would preempt the

ability of states like Maine to hold wrong

doers accountable and deter their future

wrongdoing is unacceptable. As you know

our organization has had differences with

you in the past, but we hope that you will

join us in standing against the bill. All

Mainers, especially those without the largest

salaries (especially women and children) deserve access to a fair and supportive legal

system.

Sincerely,

JOE DITRE,

Executive Director.

CITIZEN ACTION,

Bethesda, MD, April 17, 1995.

Hon. BARBARA MIKULSKI,

Hart Building,

Washington, DC.

DEAR SENATOR MIKULSKI: On behalf of

Maryland Citizen Action and our 50,000 members I am writing to urge you to oppose ‘‘The

Product Liability Fairness Act’’ (S. 565).

Please vote pro-consumer and against cloture when this bill comes up in the Senate.

If enacted the most vulnerable citizens in

our state would be further disadvantaged and

the rights of consumers to hold irresponsible

manufacturers accountable for their wrongful behavior would be severely limited.

As a champion of women’s health, working

people and children, I am sure you know that

these groups are disproportionately affected

by faulty products—breast implants, asbestos, and flammable pajamas to name just a

few. S. 565 limits the ability of these people

to collect fair compensation for their injuries or losses because it would eliminate

joint and several liability for non-economic

damages. Under current law, a plaintiff is

paid only once, and the cost is covered by

the wrongdoers who contributed to the victim’s loss. Under S. 565, non-economic damages, such as a women’s loss of fertility or a

worker’s loss of a limb, would not be fully

compensated if one of the wrongdoers is unavailable or insolvent. The victim would be

forced to carry the burden.

S. 565 also imposes a cap on punitive damages ($250,000 or 3 times economic damages)

which undermines the important deterrent

effect that these damages have on corporate

wrongdoers. Under our current system punitive damages are often the only means available to deter irresponsible behavior such as

that exhibited by Dow Corning when it

knowingly sold hundreds of thousands of

faulty and dangerous breast implants to

women. Under S. 565, large corporations,

such as Dow Corning, may find it more cost

effective to continue their harmful behavior

and risk paying punitive damages.

Please stand up for consumers in Maryland

by opposing S. 565 and voting against cloture. We are counting on your admirable

leadership and your great fighting spirit to

halt the current attack on average consumers, women, families and children.

Please let me know how you intend to

vote.

Sincerely,

SHELLI CRAVER,

Director, Maryland Citizen Action.

MARYLAND STATE TEACHERS

ASSOCIATION—NEA,

Baltimore, MD, March 29, 1995.

Hon. PAUL S. SARBANES,

U.S. Senate, Senate Office Building, Washington, DC.

DEAR SENATOR SARBANES: The Maryland

State Teachers Association has very strong

reservations about the so-called ‘‘Common

Sense Legal Reforms Act,’’ which the Senate

appears to be rushing forward without full

debate or careful analysis. We urge you to

vote against this bill as anti-consumer legislation.

We see this bill as restricting the ability of

injured consumers and workers to obtain full

and fair compensation for such injuries.

While all of us have a stake in making sure

that frivolous law suits become less common

than they appear to be, we also all have a

stake in making sure that individuals maintain rights to protest and recover damages

from product manufactures which have been

shown to be dangerous.

Therefore, I urge your opposition to this

and similar legislation.

Yours truly,

KARL K. PENCE,

President.

MARYLAND PUBLIC INTEREST

RESEARCH GROUP,

Baltimore, MD, April 24, 1995.

PROTECT VICTIMS OF DANGEROUS PRODUCTS—

OPPOSE CLOTURE AND VOTE ‘‘NO’’ ON S. 565

Hon. BARBARA MIKULSKI,

U.S. Senate,

Washington, DC.

DEAR SENATOR MIKULSKI: We are writing

on behalf of MaryPIRG’s members, and on

behalf of all residents of Maryland to urge

your strong opposition to proposed legislation, S. 565, that would eviscerate the rights
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6383

of victims of dangerous and defective products. As you know, MaryPIRG is a statewide,

non-profit, nonpartisan consumer and environmental advocacy group that has fought

to protect the rights of consumers for many

years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

DANIEL PONTIOUS,

Executive Director.

APRIL 24, 1995.

Hon. BARBARA A. MIKULSKI,

Hon. PAUL S. SARBANES,

U.S. Senate,

Washington, DC.

DEAR SENATORS: We, the undersigned organizations, urge you to oppose efforts to

weaken America’s civil justice system. We

urge you to vote against cloture on S. 565,

the product liability measure sponsored by

Sens. Gorton and Rockefeller, or any other

legislation that would weaken the rights of

the citizens of Maryland.

By restricting the rights of victims of dangerous and defective products, this measure

undermines the role of the civil justice system in redressing damages and deterring

harmful behavior. By giving ‘‘non-economic’’

damages second-class treatment, the bill discriminates against populations with less

earning power, specifically women, children,

seniors and low- and middle-income workers.

Under S. 565, the U.S. would have a twotiered system of justice where rich, high-salaried workers would be accorded better

treatment and higher damage awards than

the rest of us. Finally, by establishing brand

new federal rules for product liability cases,

S. 565 removes from state authority and

oversight a civil justice system that, despite

the hyperbole of the big business interests

backing this legislation, has served consumers and the residents of Maryland exceedingly well.

S. 565 is far more restrictive than last

year’s Senate product liability bill. First and

foremost, the bill establishes a cap on punitive damages of three times economic loss,

or $250,000, whichever is greater. Under this

cap, corporations will be punished more if

they injure or kill a corporate executive

than if the same conduct harms a child, a

senior citizen, or a schoolteacher. How can

this be fair? In addition, the bill establishes

a 20 year limit on lawsuits for capital

goods—in last year’s bill, the limit was 25

years. Moreover, S. 565 adds protections for

manufacturers of raw materials in medical

devices and for rental car companies, and reduces manufacturer liability for misuses or

alterations made to the product by anyone

else—provisions that were not in last year’s

bill.

Even if one reasonably believes that the

measure introduced by Sens. Gorton and

Rockefeller is sound public policy (which we

do not), it must ultimately be reconciled

with the extreme revisions to the civil justice system recently adopted by the House of

Representatives. H.R. 956, in addition to the

provisions outlined above, enacts an arbitrary cap on pain and suffering awards in

medical malpractice and cases involving

drugs and medical devices, at the same time

it offers an automatic punitive damages

shield for products that have received FDA

approval. In addition, the House measure extends the cap on punitive damages to all

civil lawsuits, and establishes an arbitrary 15

year statute of repose for product liability

cases.

Passage of either of these measures, or a

combination of the two, would cause grievous harm to the people who have elected

you—and depend on you—to represent their

interests in Congress. We urge you to oppose

any effort to weaken or federalize product liability laws, and to vote ‘‘no’’ on cloture on

S. 565, on S. 565, and on any conference committee reported-measure restricting the

rights of consumers.

Sincerely,

Jennifer L. Marshall, Coalition for Accountability and Justice; Anne D.

LoPiano, Law Foundation of Prince

George’s County, MD Inc.; Nancy

Davis, Maryland Sierra Club; Ken

Reichard, United Food and Commercial

Workers, Local 400; Cynthia K. Bailey,

LCSWC, Sexual Assault/Domestic Violence Center, Inc.; Dru Schmidt-Perkins, Clean Water Action; Dr. Leonardo

Ortega, Health Education Resource Organization—HERO; Michele Douglas,

Planned Parenthood of Maryland, Inc.;

Dan Pontious, Maryland PIRG; Bob

Turner, Teamsters Joint Council No.

62; Paul Safchuck, White Lung Association & National Asbestos Victims;

Woody McNemar, International Brotherhood of Electrical Workers, Local 24;

Kathleen Cahill, Maryland Employment Lawyers Association; Margaret

Morgan-Hubbard, Environmental Action Foundation.

JOBS WITH JUSTICE,

Combridge, MA, April 21, 1995.

Senator EDWARD KENNEDY,

Russell Senate Office Building,

Washington, DC.

DEAR SENATOR KENNEDY: We, the undersigned supporters of Jobs With Justice, a

workers’ rights coalition, are extremely concerned about the negative effects on the

rights of workers and consumers which will

result from proposals before the Senate to

change the civil justice system. We urge you

to oppose these proposals, particularly the

‘‘Product Liability Fairness Act,’’ (S. 565) cosponsored by Senators Rockefeller and Gorton, and to oppose cloture, for the following

reasons:

Elimination of Joint and Several Liability

for Non-Economic Damages—The Rockefeller/Gorton bill would shift costs from parties that caused injuries to injured workers

and consumers. By eliminating joint and several liability for non-economic damages, injured workers and consumers whose compensation includes losses related to lifelong

excruciating pain, loss of fertility, loss of

mobility, and disfigurement may be left to

bear the cost of those injuries. Joint and several liability requires that those judged responsible for an injury be responsible for

paying the costs of that injury. Elimination

of it for non-economic damages unfairly

hurts workers and consumers, especially

those who don’t earn high incomes or are

older since their damages often are mostly

non-economic.

Caps On Punitive Damages—Rockefeller/

Gorton would limit punitive damages to

$250,000 or three times economic damages,

whichever is greater, and would make it

much harder to impose them. Punitive damages, though rarely awarded, are a powerful

tool in preventing repetition of preventable

injuries. Limiting them would lessen the motivation of corporations to make safe products. As a result, more workers and consumers will be injured.

Statute of Repose—This would make it impossible for a worker injured by defective

machinery and equipment to receive compensation from the manufacturer if the machinery and equipment had been on the market for twenty years.

For the above reasons, we urge you to protect workers and consumers by opposing the

Rockefeller/Gorton bill and similar legislation and to oppose cloture.

Sincerely,

Juana Hernandez, Staff, Immigrant

Workers Resource Ctr.; Melanie

Kasperian, Vice President, Mass Teachers Association; Edward Kelly, Executive Director, Citizen Action of Massachusetts; Miles Calvey, Business Manager, I.B.E.W. Local 2222; Phil Mamber,

President, United Electrical Workers,

District 2; John Williams, Executive

Director, Mass. Toxics Campaign; John

Murphy, Secretary Treasurer, Teamsters Local 122; Richard Reardon, Business Agent, Teamsters Local 25; John

O’Connor, Executive Director, Jobs &

Environment Campaign; Rand Wilson,

Director, Massachusetts Jobs with Justice.

CITIZEN ACTION,

Cambridge, MA, April 20, 1995.

Senator JOHN KERRY,

Russell Senate Office Building,

Washington, DC.

DEAR SENATOR KERRY: On behalf of the

members of Citizen Action of Massachusetts,

I strongly urge you to oppose S. 565, and

similar product liability bills, and to vote

against cloture on them.

There is no ‘‘litigation explosion.’’ Defective products cases represent less than onehundredth of one percent of the total caseload in state courts, according to the National Center for State Courts. Since 1990,

total state tort filings have decreased. Nor

have punitive damage awards been widespread. Between 1965 and 1990, punitive damages were awarded in less than 15 products liability cases each year, one quarter of which

involved asbestos.

S. 565, and similar bills make it more difficult for consumers who obtain an award of

damages caused by irresponsible corporate

behavior from actually collecting those damages where more than one corporation is responsible for their injuries. In addition S. 565

and similar bills seek to drastically limit the

ability of citizen juries to award punitive

damages: the kind of damages which deter

the production and marketing of unsafe

products. At time of decreasing regulatory

oversight, the possibility of punitive damages represents a vital pro-consumer bulwark against unsafe and defective products.

Punitive damages, because they can be high,
S6384 CONGRESSIONAL RECORD — SENATE May 10, 1995

make corporations take notice and treat

product safety seriously.

S. 565 and similar bills are irresponsible

and anti-consumer. I strongly urge you to

oppose them and to vote against cloture.

Sincerely,

EDWARD F. KELLY,

Executive Director.

MASSACHUSETTS PUBLIC INTEREST

RESEARCH GROUP,

Boston, MA, 24 April 1995.

Hon. JOHN KERRY,

U.S. Senate,

Washington, DC.

DEAR SENATOR KERRY: We are writing on

behalf of MASSPIRG’s members, and on behalf of all residents of Massachusetts to urge

your strong opposition to proposed legislation, S. 565, that would eviscerate the rights

of victims of dangerous and defective products. As you know, MASSPIRG is a statewide, non-profit, nonpartisan consumer and

environmental advocacy group that has

fought to protect the rights of consumers for

many years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

DEIRDRE CUMMINGS,

Consumer Program Director.

MICHIGAN CONSUMER FEDERATION,

April 18, 1995.

Hon. CARL LEVIN,

U.S. Senator, Russell Senate Office Building,

Washington, DC.

DEAR SENATOR LEVIN: I appreciated meeting you at the ‘‘Teddy Bear Clinic’’ where

you so ably pointed out the threat to public

safety posed by the Republican’s ‘‘regulatory

moratorium.’’ Your leadership for consumer

safety has always been appreciated.

We need your leadership in another

consumer safety area—products liability.

With federal cutbacks in regulatory programs, we look to the legal system as one of

the few effective means of improving product

safety. Time and time again, it has been private lawsuits—or the perceived threat of

lawsuits—which has forced corporations to

either remove defective products from the

marketplace or improve them.

I know you are a fan of ‘‘cost-benefit’’

analyses. So are manufacturers. In a wellknown memo, Ford Motor Company calculated that it would cost more to prevent

Pintos from exploding than it would pay out

in legal expenses. Consequently, many Pinto

owners were incinerated. Why would we want

to cap the only means of making ‘‘cost-benefit’’ assessments favor consumer safety?

The Michigan Consumer Federation is a

member of the Consumer Federation of

America. Annually, CFA bestows its highest

honor for consumer advocacy—the Philip A.

Hart award. We are proud that the nation’s

largest and most respected consumer organization recognized a Michigan giant and

former United States Senator for its most

prestigious award. That places a great deal

of responsibility for those of us in Michigan.

S. 565 isn’t about fairness. It’s about corporations wanting to ‘‘get away with murder.’’ Let’s not tilt the playing field in their

favor. Vote for a strong system of individual

legal rights for victims of corporate wrongdoing. It helps make products safer for all of

us.

Sincerely,

RICK GAMBER,

Executive Vice President.

CITIZEN ACTION,

East Lansing, MI, April 24, 1995.

Senator SPENCER ABRAHAM,

Dirksen Senate Office Building, Washington,

DC.

DEAR SENATOR ABRAHAM: On behalf of the

300,000 members of Michigan Citizen Action,

I want to express our strong opposition to

the so-called ‘‘Product Liability Fairness

Act.’’ I urge you to vote against efforts to

move this anti-consumer, anti-worker legislation.

There are three major provisions in S. 565

which have been introduced in the Senate

and which would have a negative effect on

consumers and workers. First, all bills set

arbitrary limits on punitive damage awards

of $250,000 or three times economic damages,

reducing the ability to deter corporations

from inflicting harm on others and threatening Americans’ economic security and wellbeing. At a time when Congress is talking

about increasing personal responsibility, it

makes no sense to reduce the responsibility

of corporations guilty of manufacturing or

selling dangerous products.

Second, S. 565 eliminates joint and several

liability for non-economic damages, making

it difficult for consumers to recover costs related to injuries such as the loss of reproductive capacity, loss of sight, or disfigurement.

Those injuries deserve to be compensated

and should not be treated as less important

than the loss of high salaries or investment

income.

Third, S. 565 prevents workers and consumers—but not businesses—from recovering for

losses caused by defective machines or products over 20 years old.

I urge you to act to prevent passage of this

legislation which would greatly restrict the

ability of injured consumers to be compensated fully and for juries to act to prevent future wrongdoing. this bill is not in

the best interest of Michigan residents. Vote

‘‘NO’’ on cloture and ‘‘NO’’ on the bill.

Yours Truly,

LINDA A. TEETER,

Program Director.

PUBLIC INTEREST RESEARCH

GROUP IN MICHIGAN,

Ann Arbor, MI, April 25, 1995.

Hon. CARL LEVIN,

U.S. Senate,

Washington, DC.

DEAR SENATOR LEVIN. We are writing on

behalf of PIRGIM’s members, and on behalf

of all residents of Michigan to urge your

strong opposition to proposed legislation, S.

565, that would eviscerate the rights of victims of dangerous and defective products. As

you know, PIRGIM is a statewide, non-profit, nonpartisan consumer and environmental

advocacy group that has fought to protect

the right of consumers for many years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from the dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

TIMEEN WEGMEYER,

Campaign Director.

MINNESOTA COACT,

St. Paul, MN, April 24, 1995.

Senator PAUL WELLSTONE,

Hart Office Building,

Washington, DC.

DEAR SENATOR WELLSTONE: On behalf of

Minnesota COACT’s 40,000 statewide members, I am writing to urge you to vote ‘‘no’’

on S. 565 and to vote against cloture. As a

national leader in the fight for health care

reform, you probably recognize that this legislation will seriously undermine the ability

of consumers to be protected from and compensated for medical malpractice negligence.

By capping the punitive damages at

$250,000 or three times the economic loss

(whichever is greater), S. 565 restricts a person’s ability to obtain full and fair compensation and dramatically reduces the ability to deter future wrongdoing.

Furthermore, S. 565 eliminated joint and

several liability for punitive damages and

non-economic loss but not for economic

damages. This distinction will aggravate the

disparity in awards between high-income

earners and low-income earners.

Medical malpractice causes 80,000 deaths

and up to 300,000 serious injuries each year

according to a recent Harvard Medical Practice Study. For the health and safety of consumers throughout Minnesota, please vote

‘‘no’’ on S. 565 and vote against cloture on

the Senate floor.

Sincerely,

JON YOUNGDAHL,

Executive Director.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6385

MISSOURI CITIZEN ACTION,

April 24, 1995.

Senator JOHN ASHCROFT,

Senate Office Building,

Washington, DC.

DEAR SENATOR ASHCROFT, Missouri Citizen

Action strongly urges you to vote ‘‘no’’ on

Senate Bill 565. In addition, we urge you to

vote against cloture when the bill is debated

on the Senate floor. As Missouri’s largest

consumer coalition, we can tell you that this

bill could have a major negative impact on

the rights, and lives, of the tens of thousands

of Missouri consumers and families which we

represent.

Caps on punitive damages, such as those in

S.B. 565, gut the ability of our civil justice

system to threaten real punishment of those

whose negligence or greed may tempt them

to put a product on the market which could

injure us or our family members. Without

the threat of real punitive damages, these

potential corporate wrongdoers will see damages awards as just another predictable cost

of doing business, to be factored into the

price of a defective product.

The elimination of joint and several liability for non-economic damages will, likewise,

have a negative effect on average Missourians. This provision of S.B. 565 strikes especially at women, children, and seniors.

Clearly this legislation is not in the interest of working Missourians. It is merely an

attempt to shield wrongdoers from the consequences of their actions. In that you have

consistently voiced a strong opinion in favor

of ‘‘getting tough’’ on criminals who prey on

our communities, we believe that it would be

inconsistent on your part to now vote to protect those whose potential to harm innocent

victims in the pursuit of profit. Once again,

we urge you to vote ‘‘no’’ on S.B. 565, and to

vote against cloture.

Sincerely,

PATRICK HARVEY,

Executive Director.

CITIZEN ACTION,

Lincoln, NE, March 28, 1995.

Senator BOB KERREY,

Hart Office Building, Washington, DC.

DEAR SENATOR: As director of Nebraska

Citizen Action, with over 8,000 active members, I want to express our strong opposition

to the so-called ‘‘Common Sense Legal Reforms Act.’’ The Senate is rushing this bill

forward without full debate or time for careful analysis. I urge you to vote against efforts to move this anti-consumer legislation

forward, including procedural moves to cut

off debate.

This and similar bills pending in the Senate would restrict the ability of injured consumers and workers to obtain full and fair

compensation and for citizen juries to impose adequate deterrents to prevent future

injuries.

There are two major provisions which are

common to all the bills which have been introduced in the Senate and which would have

a negative effect on consumers and workers.

First, all bills would set arbitrary limits on

punitive damage awards of $250,000 or three

times economic damages, reducing the ability to deter corporations from inflicting

harm on others and threatening Americans’

economic security and well-being. At a time

when Congress is talking about increasing

personal responsibility, it makes no sense to

reduce the responsibility of corporations

guilty of manufacturing or selling dangerous

products.

Second, all bills would eliminate joint and

several liability for non-economic damages,

making it difficult for consumers to recover

costs related to injuries such as the loss of

reproductive capacity, loss of sight, or disfigurement. Those injuries deserve to be

compensated and should not be treated as

less important than the loss of high salaries

or investment income. It defies all principals

of fairness to base how we determine compensation for damages, only on a persons

yearly salary.

I urge you to act to prevent passage of this

legislation, which would greatly restrict the

ability of injured consumers to be compensated fully and for juries to act to prevent future wrongdoing.

Sincerely,

WALT BLEICH,

Director.

COALITION FOR ACCOUNTABILITY &

JUSTICE,

April 24, 1995.

Hon. J. JAMES EXON,

U.S. Senate,

Washington, DC.

DEAR SENATOR EXON: We, the undersigned

organizations, urge you to oppose efforts to

weaken America’s civil justice system. We

urge you to vote against cloture on S. 565,

the product liability measure sponsored by

Sens. Gorton and Rockefeller, or any other

legislation that would weaken the rights of

the citizens of Nebraska.

By restricting the rights of victims of dangerous and defective products, this measure

undermines the role of the civil justice system in redressing damages and deterring

harmful behavior. By giving ‘‘non-economic’’

damages second-class treatment, the bill discriminates against populations with less

earning power, specifically women, children,

seniors and low- and middle-income workers.

Under S. 565, the U.S. would have a twotiered system of justice where rich, high-salaried workers would be accorded better

treatment and higher damage awards than

the rest of us. Finally, by establishing new

federal rules for product liability cases, S.

565 removes from state authority and oversight a civil justice system that has served

consumers and the residents of Nebraska exceedingly well. As you noted during our

meeting, your efforts at medical malpractice

reform is but one example.

S. 565 is far more restrictive than last

year’s Senate product liability bill. First and

foremost, the bill establishes a cap on punitive damages of three times economic loss,

or $250,000, whichever is greater. Under this

cap, corporations will be punished more if

they injure or kill a corporate executive

than if the same conduct harms a child, a

senior citizen, or a schoolteacher. How can

this be fair? In addition, the bill establishes

a 20 year limit on lawsuits for capital

goods—in last year’s bill, the limit was 25

years. Moreover, S. 565 adds protections for

manufacturers of raw materials in medical

devices and for rental car companies, and reduces manufacturer liability for misuses or

alterations made to the product by anyone

else—provisions that were not in last year’s

bill.

One must also keep in mind that S. 565

must ultimately be reconciled with the extreme revisions to the civil justice system

recently adopted by the House of Representatives. H.R. 956, in addition to the provisions

outlined above, enacts an arbitrary cap on

pain and suffering awards in automatic punitive damages shield for products that have

received FDA approval. In addition, the

House measure extends the cap on punitive

damages to all civil lawsuits, and establishes

an arbitrary 15 year statute of repose for

product liability cases.

Passage of either of these measures, or a

combination of the two, would cause grievous harm to the people who have elected

you—and depend on you—to represent their

interests in Congress. S. 565 does nothing to

bring the rights and remedies available to

Nebraskans up to the proposed federal standards, and yet it limits our ability to shape

state law in a way that would address the

unique needs and concerns of Nebraska citizens.

We urge you to oppose any effort to weaken or federalize product liability laws, and to

vote ‘‘no’’ on cloture on S. 565, on S. 565, and

on any conference committee reported-measure restricting the rights of consumers.

Sincerely,

John Hansen, President, Nebraska Farmers Union; Carol McShane, Nebraska

Women’s Political Network; Jared

Teichmeier, President, United Rubber

Workers of America Local 286; Linda

Burkey, Executive Director, Nebraska

Head Injury Association; Walt Bleich,

Executive Director, Nebraska Citizen

Action; Cristina Sherman, State Coordinator, National Organization for

Women; Marv Morrison, SecretaryTreasurer, Communications Workers of

America Local 7470; Marty Strange,

Program Director, Center for Rural Affairs.

NEW HAMPSHIRE CITIZEN ACTION,

Concord, NH, April 20, 1995.

Senator JUDD GREGG,

Russell Senate Office Building,

Washington, DC.

DEAR SENATOR GREGG: I am writing to express my concerns about S. 565—the Rockefeller–Gorton bill. The expressed goal of this

bill is to reduce the supposed explosion of

product liability lawsuits. It does this by effectively limiting the awards a plaintive

could receive: capping punitive damages and

eliminating joint and several liability.

I have three problems with this bill. First,

I do not think that it will accomplish its

goals. I am aware of no evidence that capping awards will in fact reduce the number of

suits filed. Capping awards could in fact increase the total dollar amount of liability

awards if it removes the incentive for a producer to correct a dangerous flaw in its product, such that more injuries occur and more

suits are filed.

Second, I was under the impression that

the Republican Party was a supporter of the

rights of victims as opposed to criminals.

Punitive damages are one way of compensating victims injured through criminal negligence. Protecting the assets of the perpetrator is wrong.

Third is the issue of states’ rights. You and

your Republican colleagues have gone on and

on about returning decision making power to

the states. Yet in this bill, by preempting

state statutes, you would gather in to the

federal government powers that have belonged to the states for over two hundred

years. That, sir, is as big a flip-flop as Dick

Swett ever made!

I urge you not to support this bill, and not

to support any vote for cloture on debate of

this bill. Thank you.

Sincerely,

ROBERT D. YAGER, M.D.,

P.S.: I have been sued and lost a case involving punitive damages. Despite that personal experience, I still think this is a bad

bill.

NEW JERSEY CITIZEN ACTION,

Hackensack, NJ, April 18, 1995.

Hon. BILL BRADLEY,

Senate Office Building, Washington, DC.

DEAR SENATOR BRADLEY: New Jersey Citizen Action in requesting that you vote ‘‘NO’’

on Senate Bill 565. Additionally we are asking you to vote against cloture. If this bill is

passed, it will have a devastating effect on

the 115,000 families that are members of

N.J.C.A.
S6386 CONGRESSIONAL RECORD — SENATE May 10, 1995

By capping punitive damages at $250,000 or

three times the economic loss (which ever is

greater) the legislation removes ‘‘the punishment’’ that is supposed to be reflected in the

damages. It becomes cheaper to pay the damages than to rectify the situation.

Eliminating joint and several liability for

non-economic damages discriminates against

women, children, and seniors. Non-economic

loss is much more than pain and suffering—

it could also be loss of reproductive capacity,

loss of sight or disfigurement.

Obviously this bill is not in the best interests of New Jersey residents. Once again we

ask you to vote ‘‘NO’’ on Senate Bill 565 and

vote against cloture.

Very truly yours,

PHYLLIS SALOWE-KAYE,

Executive Director.

NEW JERSEY PUBLIC INTEREST

RESEARCH GROUP,

Trenton, NJ, April 24, 1995.

Hon. FRANK LAUTENBERG,

U.S. Senate, Washington, DC.

DEAR SENATOR LAUTENBERG: We are writing on behalf of NJPIRG’s members, and on

behalf of all residents of New Jersey to urge

your strong opposition to proposed legislation, S. 565, that would eviscerate the rights

of victims of dangerous and defective products. As you know, NJPIRG is a statewide,

non-profit, nonpartisan consumer and environmental advocacy group that has fought

to protect the rights of consumers for many

years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

ANDY IGREJAS,

Consumer Advocate.

NEW JERSEY TENANTS ORGANIZATION,

Hackensack, NJ, April 20, 1995.

Hon. FRANK LAUTENBERG,

U.S. Senate, Washington, DC.

DEAR SENATOR LAUTENBERG: The New Jersey Tenants Organization (NJTO) opposes

any changes in joint and several liability and

the imposition of punitive damage caps. This

is not reform; it is war on consumers.

Please oppose the tort reform legislation

now before the Senate and vote ‘‘NO.’’

Thank you for your anticipated stand in

favor of the consumers of the State of New

Jersey.

Yours truly,

BONNIE SHAPIRO,

Administrative Director.

CITIZEN ACTION OF NEW YORK,

Albany, NY, April 24, 1995.

Hon. DANIEL PATRICK MOYNIHAN,

Russell Senate Office Building, Washington,

DC.

DEAR SENATOR MOYNIHAN: We are writing

to urge that you protect victims of dangerous products by voting to be sure that S.

565 never comes to the Senate floor and continuing to oppose S. 565 and any other measures that would strip victims of dangerous

products, incompetent doctors or other negligent parties of their fundamental rights to

justice and fair compensation.

Those who would vote for S. 565 forget the

famous exploding Pinto, a traveling bomb

that Ford’s bean counters let stay on the

road rather than spend a few dollars to fix

the gas tank. They would forget the damage

to women from the Dalkon shield and breast

implants, products that the manufacturers

knew might cause harm. They would forget

those children who were horribly burned by

flammable pajamas. And they would forget

the thousands of workers who were exposed

to asbestos decades after the manufacturers

knew that the material caused cancer.

There are very few cases a year, 15, in

which punitive damages are awarded. But

the threat of these damages is too often the

only barrier to more companies making the

cold calculation that making a safe product

isn’t worth the cost. Artificial caps on punitive damages will result in a slap on the

wrist to negligent corporations and expose

American consumers to dangerous products.

The provision in S. 565 that would not

allow workers or consumers to sue over damages caused by older products, but allows

companies to sue, reveals the vicious anticonsumer bias of this bill. If the bill were

honestly concerned about the legal system

why would it allow businesses to sue but not

consumers or workers? The exemption for

businesses shows that the authors primary

motive is to protect corporations from being

punished for the harm their negligence

causes to consumers and employees.

We also urge your opposition to changes in

joint and several liability. This provision

only increases the likelihood that a victim

will not be fairly compensated for the injuries and suffering caused by negligence.

Those who are the most vulnerable, women,

children and the elderly, will lose the most if

joint and several liability is eliminated.

Finally, we remain concerned that the

Senate will consider establishing a cap on

pain and suffering in medical malpractice

cases. Such an action would be particularly

ironic coming just after well publicized incidents of medical malpractice. The facts remain that, as the Office of Technology Assessment found in a recent report, caps on

malpractice awards will have no impact on

the nation’s health care costs but they will

save money for doctors at the expense of victims of gross malpractice.

We urge your continued vigilance on behalf

of victims of negligence by voting against

cloture for S. 565 and working vigorously to

oppose any other measures that would gut

the civil justice system.

Sincerely,

RICHARD KIRSCH,

Executive Director.

EMPIRE STATE CONSUMER ASSOCIATION,

Rochester, NY, April 19, 1995.

Hon. ALFONSE M. D’AMATO,

Hart Building, U.S. Senate, Washington, DC.

DEAR SENATOR D’AMATO: I want to express

our strong opposition to S. 565, the ‘‘Product

Liability Fairness Act of 1995.’’ This bill

would restrict the ability of injured consumers to obtain full and fair compensation and

for citizen juries to impose adequate deterrents to prevent further injuries.

There are two major provisions of this legislation which would have a negative effect

on consumers and workers. First, this bill

would set arbitrary limits on punitive damage awards of $250,000 or three times economic damages, reducing the ability to deter

corporations from inflicting harm on others

and threatening Americans’ economic security and well-being. At a time when Congress

is talking about increasing personal responsibility, it makes no sense to reduce the responsibility of corporations guilty of manufacturing or selling dangerous products.

Second, this bill would eliminate joint and

several liability for non-economic damages,

making it difficult for consumers to recover

costs related to injuries such as the loss of

reproductive capacity, loss of sight, or disfigurement. Those injuries deserve to be

compensated and should not be treated as

less important than THE loss of high salaries

or investment income. For similar reasons as

those described, CFA also urges you to oppose S. 454, ‘‘The Health Care Liability and

Quality Act’’ which would severely affect the

rights of injured patients.

I urge you to act to prevent passage of this

legislation, which would greatly restrict the

ability of injured consumers to be compensated fully and for juries to act to prevent further wrongdoing.

Sincerely yours,

JUDY BRAIMAN.

CITIZEN ACTION,

Raleigh, NC, March 14, 1995.

Hon. D.M. LAUCH FAIRCLOTH,

U.S. Senate, Hart Office Building, Washington,

DC.

DEAR SENATOR FAIRCLOTH: On behalf of

North Carolina Citizen Action, I would like

to express our strong opposition to the socalled ‘‘Product Liability Fairness Act’’, S.

565. I urge you to vote against efforts to pass

this legislation, as it is anything but fair to

your constituents or to any individual American citizen.

While the proponents of this bill have attempted to cast a ‘‘moderate’’ light on the

legislation, painting it as more fair and equitable than proposed legal reforms which

came before it, our careful study from the

consumer’s perspective has revealed that it

is neither fair nor equitable to real Americans. Areas of particular concern include:

Punitive damage caps of $250,000 or three

times the economic loss. Imposing such caps

completely undermines the important deterrent effect which these damages have on corporate wrongdoing. While punitive damages

are rarely used, the very threat of that their

existence presents has proven to be critical

in persuading manufacturers to improve the

safety of their products or in actually removing unsafe products from the marketplace. If you undermine this system, American consumers truly will be at the mercy of

big business.

Elimination of joint and several liability

for non-economic damages. This provision

discriminates against the most vulnerable

members of our society—women, children,

seniors, the poor—whose form of compensation would most likely be in the form of noneconomic damages. This legislation says

that only the wealthy should be empowered

to hold wrongdoers accountable for their
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6387

egregious behavior. These damages also

cover a great deal more than just pain and

suffering, as is often thought. They also

cover loss of reproductive capacity, loss of

sight, and disfigurement. Is it fair to punish

individuals who have suffered these tragedies?

S. 565 is not fair, although its name attempts to imply otherwise. It is not fair to

the workers, to women, to children, to the

real people of this country. It is a one-sided,

unjustified and cynical attempt to provide a

subsidy to big business at the expense of the

American consumer.

We understand that S. 565 will be brought

to the floor on Monday, April 24 and a vote

on cloture could come within a few days of

this. We urge you to cast your vote on behalf

of your constituents and all American citizens and oppose S. 565 by voting ‘‘NO’’ on

cloture.

Sincerely,

LORI EVERHART,

State Director.

COALITION FOR ACCOUNTABILITY

AND JUSTICE,

April 4, 1995.

Hon. KENT CONRAD,

Hon. BYRON DORGAN,

U.S. Senate, Washington, DC.

DEAR SENATORS: We, the undersigned organizations, urge you to oppose efforts to

weaken America’s civil justice system, and

to vote ‘‘no’’ on S. 565, the product liability

measure sponsored by Sens. Gorton and

Rockefeller.

By restricting the rights of victims of dangerous and defective products, this measure

undermines the role of the civil justice system in redressing damages and deterring

harmful behavior. By limiting pain and suffering damages in some cases, the bill will

severely restrict awards to certain groups—

including seniors, women, and children—and

favor the rich who, in the case of death or serious injury, have high lost wages, over the

rights of low- and middle-income wage earners. Finally, by establishing brand new federal rules for product liability cases, S. 565

removes from state authority and oversight

a civil justice system that, despite the hyperbole of the big business interests backing

this legislation, has served consumers and

the residents of North Dakota exceedingly

well.

S. 565 is far more restrictive than last

year’s Senate product liability bill. First and

foremost, the bill establishes a cap on punitive damages of three times economic loss,

or $250,000, whichever is greater. Under this

cap, corporations will be punished more if

they injure or kill a corporate executive

than if the same conduct harms a child, a

senior citizen, or a schoolteacher. How can

this be fair? In addition, the bill establishes

a 20 year limit on lawsuits for capital

goods—in last year’s bill, the limit was 25

years.

Even if one reasonably believes that the

measure introduced by Sens. Gorton and

Rockefeller is sound public policy (which we

do not), it must ultimately be reconciled

with the extreme revisions to the civil justice system recently adopted by the House of

Representatives. H.R. 956, in addition to the

provisions outlined above, enacts an arbitrary cap on pain and suffering awards in

medical malpractice and cases involving

drugs and medical devices, at the same time

it offers an automatic punitive damages

shield for products that have received FDA

approval. In addition, the House measure extends the cap on punitive damages to all

civil lawsuits, and establishes an arbitrary 15

year statute of repose for product liability

cases. Passage of either of these measures, or

a combination of the two, would cause grievous harm to the people who have elected

you—and depend on you—to represent their

interest in Congress. We urge you to oppose

any effort to weaken or federalize product liability laws, and to vote ‘‘no’’ on cloture on

S. 565, and on any conference committee reported-measure restricting the rights of consumers.

Sincerely,

Gerrard Friesz, North Dakota Public Employees Association.

Pam Solwey, North Dakota DES Action.

Sherry Shadley, North Dakota Clean

Water Action.

Chuck Stebbins, Dakota Center for Independent Living.

Pauline Nygaard, North Dakota Breast

Implant Coalition.

Don Morrison, North Dakota Progressive

Coalition.

Lani Weatherly, Laborers International

Union, Local 580.

Jude M. Reilly, Boilermakers Local 647.

Gary L. Nelson, Ironworkers Local 793.

John Risch, United Transportation

Union.

Dexter Perkins, Sierra Club, Agassiz

Basin Group.

Gary McKenzie, Plumbers and Pipefitters

Local 338.

Rev. Jack Seville, United Church of

Christ (organization for identification

only).

Dean Cypher, Teamsters Local 116.

Al Thomas, Teamsters Local 123.

Norman Stuhlmiller, (former chairperson, Legislative Committee, North

Dakota AARP).

Logan Dockter, Plumbers and Pipefitters

Local 795.

Jeff Husebye, Doug Swanson, Workers

Against Inhumane Treatment.

CITIZEN ACTION,

April 24, 1995.

Members of the U.S. Senate, Washington, DC:

DEAR SENATORS: I am writing on behalf of

Ohio Citizen Action, Ohio’s largest consumer

and environmental organization, to urge

Members of the Senate to oppose S. 565 and

to vote against cloture. There are a number

of reasons for our opposition to this bill, but

we will briefly mention only two.

First, the cap on punitive damages would

unquestionably undermine the potential for

such assessments to truly punish wrongdoers. While punitive damage assessments

are rare in product liability cases, they often

are the only means for citizens to stop the

reckless behavior of a wrongdoer. With the

arbitrary cap, not only would future punitive

damage assessments not adequately punish

the wrongdoer, but companies could calculate whether it would be more cost-effective to produce a safe product or risk punitive damages.

Second, the statute of repose would deny

workers and consumers their right to seek

compensation if they are injured by a product that is more than twenty years old. It is,

by no means, uncommon for workplace

equipment to exceed this limit. At the same

time, however, businesses are exempt from

this restriction. The company can still sue

for commercial losses.

S. 565 would be a giant step backwards in

a legal system that now works reasonably

well to protect average Americans. We urge

you to oppose S. 565 and to vote against cloture.

Thank you for your consideration.

Sincerely,

SHARI WEIR,

Consumer Issues Director.

OHIO PUBLIC INTEREST RESEARCH

GROUP,

Columbus, OH, April 25, 1995.

Hon. MIKE DEWINE,

U.S. Senate, Washington, DC.

DEAR SENATOR DEWINE: We are writing on

behalf of Ohio PIRG’s members, and on behalf of all residents of Ohio to urge your

strong opposition to proposed legislation, S.

565, that would eviscerate the rights of victims of dangerous and defective products. As

you know, Ohio PIRG is a statewide, nonprofit, nonpartisan consumer and environmental advocacy group that has fought to

protect the rights of consumers for many

years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

AMY SIMPSON,

Campaign Director.

OREGON STATE PUBLIC INTEREST RESEARCH GROUP,

Portland, OR, April 25, 1995.

Hon. MARK HATFIELD,

U.S. Senate, Washington, DC.

DEAR SENATOR HATFIELD: We are writing

on behalf of OSPIRG’s members, and on behalf of all residents of Oregon to urge your

strong opposition to proposed legislation, S.

565, that would eviscerate the rights of victims of dangerous and defective products. As

you know, OSPIRG is a statewide, non-profit, nonpartisan consumer and environmental

advocacy group that has fought to protect

the rights of consumers for many years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. It caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.
S6388 CONGRESSIONAL RECORD — SENATE May 10, 1995

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

MAUREEN KIRK,

Executive Director.

VICTIMS AGAINST LETHAL VALVES,

Pittsburg, PA, April 19, 1995.

Hon. ARLEN SPECTER,

U.S. Senate, Washington, DC.

DEAR SENATOR SPECTER: As founder and

leader of V.A.L.V. (Victims Against Lethal

Valves) I am writing to you for all implanted

victims of the Bjorg/Shiley ConvexoConcave

heart valve to urge you to vote against bill

S. 565.

We oppose this legislation as it definitely

limits the rights of consumers in our civil

justice system. We believe bill S. 565 is an

anti-consumer legislative move that will

only enhance the rights of big business, i.e.,

manufacturers. We believe that this bill will

only encourage manufacturers to have a

stronger attitude of uncaring towards the

products they produce and place in the marketplace for the consumer. Today, with

workers’ relaxed attitudes and work ethics it

would hardly be a feasible idea to give the

manufacturers a freer hand in the quality

control of products. This is a time when we

need stronger controls over big business, not

the consumer. The consumer is being hurt

enough as it is with the dangerous quality of

products that is being turned out to them

now.

Injuries that are the result of a manufacturer’s flaw should be compensated to the injured. When products are marketed as being

wonderful and safe in fancy, expensive advertisements to draw in the consumer to purchase, the manufacturer should be responsible for any consequence after the sale of

their product if it has been flawed from the

manufacturing process.

V.A.L.V. members throughout the state of

Pennsylvania strongly urge you to vote

against bill S. 565 as well as similar legislation and to vote against cloture.

We thank you for considering our fears.

Respectfully yours,

ELAINE S. LEVENSON,

Founder.

CITIZEN ACTION/

PENNSYLVANIA CHAPTER,

April 21, 1995.

Hon. ARLEN SPECTER,

U.S. Senate, Washington, DC

DEAR SENATOR SPECTER: On behalf of our

40,000 members in Pennsylvania, we are writing to express our strong opposition to S. 565,

the so-called ‘‘Product Liability Fairness

Act’’ sponsored by Senators Rockefeller and

Gorton. We urge you to oppose any effort to

move this anti-consumer, anti-worker legislation forward, including procedural moves

to cut off debate.

S. 565 would drastically limit the ability of

injured consumers and workers to obtain full

and fair compensation, and would restrict

the ability of citizen juries to impose adequate deterrents to prevent future injuries.

Specifically, S. 565 would place caps on punitive damage awards of $250,000 or three

times economic damages. Such awards, while

rare, are designed to punish corporations

that intentionally or recklessly disregard

the safety of consumers, and to deter other

corporations from such behavior. Placing arbitrary limits on punitive damages will only

serve to encourage such behavior, placing

consumers at greater risk.

S. 565 would also eliminate joint and several liability for noneconomic damages,

making it difficult for consumers to recover

costs related to injuries such as the loss of

child-bearing capacity, loss of sight or limb,

or disfigurement. This provision places a

greater value on lost income, thereby discriminating against women, children, and

senior citizens.

Finally, this bill would prevent workers

and consumers—but not businesses—from recovering damages for losses caused by defective machines or products that are more

than 20 years old.

We strongly urge you to protect the legal

rights of consumers and workers throughout

Pennsylvania by voting against passage of S.

565 and voting against cloture. Thank you

for your consideration.

Sincerely,

LAUREN TOWNSEND,

Philadelphia Area Director.

JENNIFER O’DONNELL,

Pittsburgh Area Director.

PENNSYLVANIA PUBLIC INTEREST RESEARCH GROUP,

Philadelphia, PA, April 24, 1995.

Protect Victims of Dangerous Products—Oppose Cloture and Vote No on S. 565.

Hon. ARLAN SPECTER,

U.S. Senate, Washington, DC.

DEAR SENATOR SPECTER: We are writing on

behalf of PennPIRG’s members, and on behalf of all residents of Pennsylvania to urge

your strong opposition to proposed legislation, S. 565, that would eviscerate the rights

of victims of dangerous and defective products. As you know, PennPIRG is a statewide,

non-profit, nonpartisan consumer and environmental advocacy group that has fought

to protect the rights of consumers for many

years.

Each year, more than 28 million Americans

are injured by consumer products and 21,000

are killed. Why should this Senate pass legislation that limits the legal rights of victims

at the same time as it is cutting back funding for the federal agencies that are supposed

to protect consumers from these dangerous

products?

S. 565, the so-called Product Liability

‘‘Fairness’’ Act is, in fact, manifestly unfair

to consumers. We have numerous problems

with the bill. Its caps on punitive damages

will encourage faulty product design. Its

limits on pain and suffering damages unfairly and unjustly restrict awards to

women, children and senior citizens who are

harmed. Its preemption of numerous stronger state laws is unfair to all consumers.

These anti-consumer provisions of S. 565

make it unacceptable. Yet the Senate must

also consider that, if passed, S. 565 would

have to be reconciled with the even more

egregious and extreme House-passed bill.

H.R. 1075, in addition to the measures above,

arbitrarily caps pain and suffering awards in

medical malpractice cases and establishes an

automatic punitive damages shield for FDAapproved products. Worse, the House cap on

punitive damages extends to all civil lawsuits, not only to product liability cases.

We urge you to vote against cloture on S.

565, against S. 565 and against any conference

measure restricting the rights of consumers.

We look forward to hearing your views on

this important legislation. Please contact

me if you or your staff have any questions.

Sincerely,

STEPHANIE HAYNES,

Campaign Director.

DES ACTION,

Nescopeck, PA, April 24, 1995.

DEAR SENATOR RICK SANTORUM: On behalf

of 480,000 DES exposed in Pa. we deplore you

to oppose S.B. 565.

We still deserve to have a trial by jury and

also awarded as they see fit. That means no

PS!

Common Sense Legal Reform was written

to protect major corporations and forgetting

the real victims. Such as 10 million DES exposed.

Our spouses deserve to receive compensation for * * * several liability.

DES Action Pa. would urge you to prevent

passage of any legislation, which would

greatly restrict the ability of injured consumers to be compensated fully and * * * injured to act to prevent further wrongdoing.

Sincerely,

MARY JEAN GRECO GOLOMB.

PENNSYLVANIA AFL–CIO,

Harrisburg, PA, April 6, 1995.

Re S. 565—Product Liability.

Hon. RICH SANTORUM,

U.S. Senate, Dirkson Bldg.,

Washington, DC.

DEAR SENATOR SANTORUM: We are writing

to urge your strong opposition to S. 565, reforms to the Product Liability Law. S. 565

will have its most dramatic effect on working men and women who are injured by defective machinery. It is our understanding

that 60% of the Product Liability claims

arise from workplace injuries.

First and foremost, we are concerned that

weakening the Product Liability Law will

undermine safety in the workplace. As a

practical matter, it is the threat of a lawsuit

that encourages manufacturers to design and

produce safe machinery. OSHA, which could

play some role, has been ineffective in regulating in this area and is likely to continue

to be ineffective. We must look to the Product Liability Law as the single most important force for safety machinery in the workplace.

The specific changes proposed by S. 565

will not only undermine safety, but unfairly

deny injured workers compensation for loss

of body part or body function.

Several issues are of priority concern for

Pennsylvania workers:

(1) Twenty-year Statute of Repose:

The statute of repose would deny the right

to file a claim if a worker is injured by machinery more than 20 years old. Pennsylvania, as you know, is a mature industrial

state. Many of our workers are working with

machinery that is older than 20 years.

To cut off their rights by a fixed time limitation is artificial and will deny those injured any remedy. The age of the machine

should be taken into account in determining

the defect, but the proposed change is inflexible and unfair. Finally, it will create a

market for used machinery rather than encourage new manufacturing of safer equipment.

(2) The overriding of both the Federal Employers’ Liability Act and the Longshoremen’s and Harbor Workers Compensation

Act will hurt those covered by these laws in

Pennsylvania—specifically our Longshoremen and Railroad and Airline workers.

(3) The elimination of joint and several liability could end up leaving injured workers

with no responsible party to pay for a judgement and award.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6389

(4) The cap on punitive damages again is

arbitrary and will undermine the incentive

to produce safe machinery. The cap of

$250,000 is artificially low and fails to consider the reality that few punitive damages

are awarded under current Pennsylvania law.

The real purpose of punitive damages is to

control outrageous conduct on the part of

manufacturers.

These are just some of our major concerns

with S. 565.

We urge you to strongly oppose this legislation and vote in support of encouraging the

manufacture of safe products. Each year,

150,000 Pennsylvanians experience serious

workplace injuries and close to 5,000 occupationally caused deaths occur. Many of these

injuries and diseases are caused by defective

products. S. 565 will only add to the pain and

suffering of those who go to work each day

with an expectation of returning home safe.

Thank you.

Sincerely,

WILLIAM M. GEORGE,

President.

RICHARD W.

BLOOMINGDALE,

Secretary-Treasurer.

COALITION FOR ACCOUNTABILITY

& JUSTICE

April 24, 1995.

Hon. LARRY PRESSLER,

Hon. THOMAS DASCHLE,

U.S. Senate, Washington, DC.

DEAR SENATOR: We, the undersigned organizations, urge you to oppose efforts to

weaken America’s civil justice system. We

urge you to vote against cloture on S. 565,

the product liability measure sponsored by

Sens. Gorton and Rockefeller, or any other

legislation that would weaken the rights of

the citizens of South Dakota.

By restricting the rights of victims of dangerous and defective products, this measure

undermines the role of the civil justice system in redressing damages and deterring

harmful behavior. By giving ‘‘non-economic’’

damages second-class treatment, the bill discriminates against populations with less

earning power, specifically women, children,

seniors and low- and middle-income workers.

Under S. 565, the U.S. would have a twotiered system of justice where rich, high-salaried workers would be accorded better

treatment and higher damage awards than

the rest of us. Finally, by establishing brand

new federal rules for product liability cases,

S. 565 removes from state authority and

oversight and civil justice system that, despite the hyperbole of the big business interests backing this legislation, has served consumers and the residents of South Dakota

exceedingly well.

S. 565 is far more restrictive than last

year’s Senate product liability bill. First and

foremost, the bill establishes a cap on punitive damages of three times economic loss,

or $250,000, whichever is greater. Under this

cap, corporations will be punished more if

they injure or kill a corporate executive

than if the same conduct harms a child, a

senior citizen, or a schoolteacher. How can

this be fair? In addition, the bill establishes

a 20 year limit on lawsuits for capital

goods—in last year’s bill, the limit was 25

years. Moreover, S. 565 adds protections for

manufacturers of raw materials in medical

devices and for rental car companies, and reduces manufacturer liability for misuses or

alterations made to the product by anyone

else—provisions that were not in last year’s

bill.

Even if one reasonably believes that the

measure introduced by Sens. Gorton and

Rockfeller is sound public policy (which we

do not), it must ultimately be reconciled

with the extreme revisions to the civil justice system recently adopted by the House of

Representatives. H.R. 956, in addition to the

provisions outlined above, enacts an arbitrary cap on pain and suffering awards in

medical malpractice and cases involving

drugs and medical devices, at the same time

it offers an automatic punitive damages

shield for products that have received FDA

approval. In addition, the House measure extends the cap on punitive damages to all

civil lawsuits, and establishes an arbitrary 15

year statute of repose for product liability

cases.

Passage of either of these measures, or a

combination of the two, would cause grievous harm to the people who have elected

you—and depend on you—to represent their

interests in Congress. We urge you to oppose

any effort to weaken or federalize product liability laws, and to vote ‘‘no’’ on cloture on

S. 565, on S. 565, and on any conference committee reported-measure restricting the

rights of consumers.

Sincerely,

Mike Coffey, AFSCME; Bob Burns, South

Dakota State University; Jeanne

Koster, South Dakota Peace and Justice Center; Jack E. Dudley, South Dakota AFL–CIO; Roann Redlin, South

Dakota Coalition Against Domestic Violence; Phyllis Bitterman, United Paperworks International Union; Karen

Fogas, East River Group Sierra Club;

David Feller, IBEW, Local 426; Charon

Asetoyer, Native American Women’s

Health and Education Center; Jim

Larson, UFCW Local 304A; Roann

Redlin, South Dakota Advocacy Network; Sam Clauson, Black Hills Group

Sierra Club; Mary Kirkus, South Dakota DES Action; Charon Asetoyer,

Native American Women’s Reproductive Rights Coalition; Darrell Drapeau,

Yankton Sioux Tribe; Rick Davids,

United Transportation Union.

CITIZEN ACTION,

Nashville, TN, April 20, 1995.

Hon. FRED THOMPSON,

Dirksen Senate Office Building, Washington,

DC.

DEAR SENATOR THOMPSON: Greetings from

Nashville. I am director of Tennessee Citizen

Action, a grassroots consumer group with

over 5,000 members across the state. I am

writing to express Citizen Action’s strong

concerns about S. 565, the product liability

bill to be considered next week on the Senate

floor.

It is our view that this legislation would

have serious implications for the health and

safety of your constituents. S. 565 would impose federal requirements, for the first time

in over two hundred years, on an area which

has been under state authority. In doing so,

we believe that it would limit both the ability of injured consumers to obtain fair compensation and the ability of citizen juries to

hold guilty parties accountable for their actions. As a result, the incentives which have

convinced many companies to improve the

safety of their products will be lessened.

While there are a number of troubling provisions in S. 565, I would like to raise two

key issues. First, the bill would destroy the

ability of citizen juries to impose penalties

on wrongdoers in order to prevent future injuries. Punitive damages are rarely used. In

fact, over the last 25 years, punitive damages

have been awarded in less than 15 cases each

year (less than 11 cases excluding asbestos

cases). But punitive damages have proven to

be critical in persuading manufacturers to

improve the safety of their products or remove unsafe products from the marketplace.

By placing arbitrary caps on awards, S. 565

would make it virtually impossible for citizen juries to act to protect society from future harm. At a time when Congress is considering limits on federal regulation, it

makes little sense to further erode the ability of people to use the courts as a way to

improve the safety of the marketplace.

Second, S. 565 would establish a discriminatory legal system in which the level of

compensation is based not on the level of the

injury, but on the economic status of the injured consumer. By eliminating joint and

several liability for non-economic damages,

the bill states that it is not important to

compensate individuals for having to live

with excruciating pain, disfigurement, blindness, or loss of the ability to bear children.

Given these and other provisions, Tennessee Citizen Action believes that the passage of S. 565 would be detrimental to consumers and the nation. We appreciate your

consideration of our views and look forward

to learning your position on these important

issues.

Sincerely,

C. BRIAN MCGUIRE,

State Director.

TEXAS CITIZEN ACTION,

Austin, TX, April 23, 1995.

Hon. PHIL GRAMM,

U.S. Senate, Washington, DC.

DEAR SENATOR GRAMM: We are writing you

to ask for your vote against cloture on S.565

the ‘‘Unfair Product Liability Act’’ introduced by Senator Rockefeller. We are extremely concerned about the impact this

will have on the safety standards of everyday

products for consumers and innocent citizens. We believe there are several provisions

of the bill which will eliminate the consumers ability to hold wrongdoers accountable

for their actions, and limit innocent victims

recourse to fully recover for damages they

have accrued.

Capping punitive damages will do nothing

to increase safety standards for innocent

consumers. By limiting punitive damage

awards to $250,000 or three times economic

damages you are creating a nuisance expense

for multi-billion dollar companies such as

Ford Motor Company or Dow Chemical. This

is creating a predictability in the market

place for the minute number of companies

who act negligently allowing them to calculate their risk for producing a less than

safe product and further lets them rest assured they will never be held liable past a

certain dollar amount.

S.565 prevents consumers from holding

manufacturers of products which cause significant harm or injury accountable if the

product is older than 20 years. Many products are intended to last longer than 20

years. This law however, would eliminate all

consumer rights to be made whole if a 20

year old product caused significant harm or

damages. This is an example of corporate

wrongdoers being protected at the expense of

consumers protection.

The elimination of ‘‘Joint and Several Liability’’ is a slap in the face to innocent individuals, families, and communities. Allowing

guilty defendants off the hook without having to make innocent victims 100% whole is

a disgrace. We will without a doubt see victims paying for portions of their damages

even when they were completely without

fault. This will not only affect individuals

but likewise families, communities, cities,

and states. We will see wrongdoers getting

off free of charge while cities, towns, and

families pick up the tab for the irresponsible

behavior of others.

Texas Citizen Action has a membership of

well over 150,000 citizens. These people have

joined our organization because they believe

in the positions we take on consumer protection issues. The passage of S.565 will be a

major step backwards for individuals and

communities and their rights to hold others
S6390 CONGRESSIONAL RECORD — SENATE May 10, 1995

accountable for wrongs they may commit.

We ask you to vote against cloture on S.565

for the citizens of Texas.

Sincerely,

DANIEL LAMBE,

Program Director.

DEFENDERS OF THE RIGHTS OF TEXANS,

Austin, TX, April 24, 1995.

Re S. 565.

Hon. KAY BAILEY HUTCHISON,

U.S. Senate, Washington, DC.

DEAR SENATOR HUTCHISON: Defenders of the

Rights of Texans (DRT) is asking you to vote

against cloture on S. 565, Sen. Rockefeller’s

‘‘Unfair Product Liability Act.’’ This bill

will adversely impact the safety standards of

products which we consumers utilize on a

daily basis. We strongly feel that victims of

unsafe products must retain the ability to

hold accountable those who produce products

which kill and maim. Limiting damages does

not protect consumers, it protects manufacturers of products that injure consumers.

That should not happen!

The effect of eliminating some of the current protections in the law will be to make

the victim pay twice, even when they contributed nothing to the accident or injury. If

Congress eliminates ‘‘Joint and Several Liability’’, you will make it difficult for your

constituents to recover fully from their misfortune. The only pain and suffering you will

be eliminating is that of the offending party.

We support victims’ rights, not the rights of

those corporations or individuals who do not

want to take responsibility when their products harm the American public.

We oppose capping punitive damages because we know that it takes significant

awards to get the attention of manufacturers

who continue to foist its products on an

unsuspecting public years after the corporation knows the product to be unsafe. Why

Congress would consider rewarding such unacceptable behavior is beyond our organization’s comprehension.

Defenders of the Rights of Texans is a coalition of individuals and organizations—

consumer, environmental, worker, academic,

clergy, student, and victims—who oppose

sacrificing our rights on the alter of corporate greed. We ask you to represent our interests by voting against cloture on S. 565.

Sincerely,

BOB COMEAUX,

San Antonio, TX.

VIRGINIA NATIONAL ORGANIZATION

FOR WOMEN,

April 15, 1995.

Hon. CHARLES ROBB,

U.S. Senate, Washington, DC.

DEAR SENATOR ROBB, Virginia N.O.W., represents some 20,000 Virginia women. We are

writing to urge you to vote no on cloture and

no on S. 565 and any other measure that restricts individual legal rights.

S. 565, the ‘‘Product Liability Fairness

Act’’, is in fact, unfair. By limiting non-economic damages, it give wealthy individuals

and corporations greater rights than middleincome citizens and families. Additionally,

S. 565 transfers authority for the civil justice

system from the states to the federal government. States know better how to serve its

individual citizens and the issues that impact the citizens than the Washington bureaucracy. Whatever happened to the idea of

states’ rights and limiting the power of the

federal government? S. 565 caps pain and suffering awards on medical malpractice suits.

Why single out a particular type of lawsuit

to cap awards?

Virginia N.O.W. has supported many

women who have filed lawsuits, for both

international and negligent injuries. During

the 1995 legislative session we along with

other citizens groups such as the VTLA,

NAACP, ACLU, LofWV, worked hard to obtain a compromise on the Virginia Human

Rights Act. A bill which passed the legislative session only to be vetoed by the Governor. The bill reverses the Lockhart decision, which basically prevents a small business employee from filing a lawsuit based on

race, color, sex or national origin. Additionally, VA N.O.W. supports lawsuits for sexual

harassment, defective products, product liability, employment discrimination and of

course intentional injury. Economic justice

as well as civil justice must be preserved. S.

565 seeks to destroy both, please vote ‘‘no’’

on S. 565.

People all across America are closely

watching the new Republican majority in

Congress in an effort to determine whether it

truly represents the people or big business.

Surely, the outcome and deliberations of S.

565 will provide an answer.

Sincerely,

DULANEY S. NICKERSON.

CITIZEN ACTION,

Charlottesville, VA, April 17, 1995.

Hon. CHARLES S. ROBB,

Russell Senate Office Building, Washington,

DC.

DEAR SENATOR ROBB: I am writing on behalf of Virginia Citizen Action and its over

50,000 members to ask you to oppose S. 565,

the ‘‘Product Liability Fairness Act.’’ We

would ask you that you do whatever is necessary to defeat this bill, including voting

against any effort invoke cloture on debate.

Senator, this bill would make America a

much more dangerous place for all of us. By

capping punitive damages, this bill will send

a signal to corporate wrongdoers that they

can escape any real punishment for making

and selling products that will kill or injure

innocent people. S. 565 would eliminate the

deterrent effect of punitive damages and remove one of the real protections Americans

have had for over 200 years.

This bill is anything but fair. By eliminating joint and several liability for non-economic damages, it discriminates against

women, children and seniors. Non-economic

damages are not just pain and suffering.

What about a women’s loss of the ability to

bear children or a child’s disfigurement for

life!

Senator, S. 565 is not ‘‘moderate’’ and it is

not ‘‘fair’’. We hope that you will work to defeat this bill and protect every Virginian and

every American from those special interests

who want to escape responsibility for their

actions at the expense of the health and safety of the American people.

Sincerely,

MARC WETHERHORN,

State Director.

VIRGINIA CITIZENS CONSUMER COUNCIL,

Yorktown, VA, April 25, 1995.

Re S. 565.

Hon. CHARLES S. ROBB,

U.S. Senate,

Washington, DC.

DEAR SENATOR ROBB: The Virginia Citizens

Consumer Council strongly urges you to oppose S. 565, the ‘‘Product Liability Fairness

Act of 1995. This bill will do irreparable harm

to Virginia consumers by restricting the

ability of injured consumers to obtain full

and fair compensation and for citizen juries

to impose adequate deterrents to prevent

further injuries. Corporate wrongdoers must

be held accountable when consumers are

harmed by the products they buy as a matter

of simple justice and to foster confidence in

the American marketplace.

Two major provisions of this legislation

will have a negative impact on consumers

and workers. First, this bill sets arbitrary

limits on punitive damage awards of $250,000

or three times the economic damages, reducing the ability to deter corporations from inflicting harm on others and threatening Virginians’ economic security and well-being.

At a time when Congress is talking about increasing personal responsibility, it makes no

sense to reduce the responsibility of corporations guilty of manufacturing or selling dangerous products.

Second, this bill eliminates joint and several liability for non-economic damages,

making it difficult for consumers to recover

costs related to injuries such as the loss of

reproductive capacity, loss of sight, or disfigurement. Those injuries deserve to be

compensated and should not be treated as

less important than the loss of high salaries

or investment income. For similar reasons,

VCCC urges you to oppose S. 454, ‘‘The

Health Care Liability and Quality Assurance

Act’’ which would severely affect the rights

of injured patients.

VCCC urges you to act to prevent passage

of this legislation, which will greatly restrict the ability of injured consumers to be

compensated fully and for juries to act to

prevent further wrongdoing. Virginia consumers count on you to act in our best interest by voting NO on this anti-consumer,

auto-worker bill. Please let me know the

outcome of the Senate votes on S. 565 and S.

454 and how you cast your votes. Thank you.

Sincerely,

JEAN ANN FOX,

President.

WASHINGTON CITIZEN ACTION,

STATE HEADQUARTERS,

Seattle, WA, April 19, 1995.

Hon. SLADE GORTON:

On behalf of our 42,000 members statewide

and our 20 affiliate community, church,

labor, and senior organizations, Washington

Citizen Action urges you to oppose Senate

Bill 565 and to vote against cloture. This bill

is one of the most anti-consumer pieces of

legislation to make it to the Senate floor in

decades. Please do all that you can to stop S.

565 from passing.

The arbitrary caps on punitive damages

would eliminate the incentive to produce

safe products and would allow negligent corporations to operate with little to no accountability. S. 565 will undoubtedly result

in a multitude of injuries, disfigurements,

and deaths. In addition, these limits will

take away all recourse society has to punish

wrongdoers that knowingly and repeatedly

maim and kill people with deadly products

and negligent actions.

By eliminating joint and several liability

for non-economic damages, S. 565 would

weaken the ability of ordinary Americans to

receive fair compensation when they are injured by unsafe products and practices. The

bill is unfair to women, children, seniors,

working families, small businesses, and

lower to middle income Americans. Victims

and their families will be rendered unable to

receive adequate compensation for their injuries while the guilty parties are let off the

hook. This is not our idea of American justice.

In America, the courts have proven to be

the major protection citizens have against

negligent corporations and unsafe products.

We cannot afford to let our civil justice system be dismantled by the provisions of S.

565. Vote NO on S. 565! Vote NO on cloture!

Sincerely,

DAVID WEST,

Executive Director.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6391

WEST VIRGINIA-CITIZEN ACTION GROUP,

Charleston, WV, April 24, 1995.

Re Proposed legislation concerning Civil

Justice System (S. 565).

Hon. JOHN D. ROCKEFELLER, IV,

U.S. Senate,

Washington, DC.

DEAR SENATOR ROCKEFELLER. On behalf of

the twenty thousand members of the West

Virginia-Citizen Action Group (WV–CAG), I

am writing this brief letter to encourage you

to rethink your support for S. 565. However

well-intentioned this legislation may be, I

honestly believe that the potential—and unintended—consequences are so great as to

offset any perceived benefits.

I realize, of course, that the House-passed

‘‘Common Sense Legal Reform Act’’ is more

draconian than S. 565. This does not ameliorate the many deficiencies contained in the

Senate bill, including the two most egregious (as follows):

By capping punitive damage caps at

$250,000 or three times the economic loss

(whichever is greater), the proposed legislation removes the ‘‘punishment’’ that is supposed to be reflected in damages. As a result,

it will become cheaper in many instances to

pay the damages than to rectify the problem.

By eliminating joint and several liability

for non-economic damages, the proposed legislation unfairly discriminates against

women, children, and seniors. Non-economic

loss is much more than pain and suffering; it

can also be loss of reproductive capacity,

loss of right or disfigurement.

After studying this, and related tort reform proposals for many year, we are convinced that such efforts are contrary to public policy and will jeopardize the handearned rights of injured West Virginians. Accordingly, I would like to urge you to reconsider your position and fight, as you have

done so often in the past, for the rights of

West Virginia consumers.

Thank you very much for your time and

consideration. I hope to see and/or talk with

you again soon. If you need any further information, please feel free to contact me.

Sincerely,

STATE SENATOR DAVID GRUBB,

Executive Director.

WISCONSIN CONSUMERS LEAGUE,

Milwaukee, WI.

Re SB 565 and 454.

Senator HERBERT KOHL,

U.S. Senate,

Washington, DC.

DEAR SENATOR KOHL: We write to urge

your opposition to the so-called ‘‘Common

Sense Legal Reforms Act’’ submitted as part

of the Contract with America. This package

of bills would substantially modify existing

product liability and medical malpractice

laws. It is largely unsupported by the vast

majority of the rigorous evidence which has

been developed on these topics. Rather, it is

seemingly being swept along on a wave of

anecdote, innuendo and, in some cases, outright untruths.

There can be little doubt that product liability and medical malpractice laws have

evolved to reflect emerging technologies.

They have had the desired effects of modifying behavior to the optimum end of preventing injury to consumers and workers. The

claims regarding the alleged stultifying effects of these bodies of common law are generally unsupported by credible, systematic

evidence. For example, the work of Professor

Galanter, at the UW Law School, compellingly refutes allegations regarding any alleged ‘litigation explosion’. The punitive

damages which S. 565 would limit are only

relatively rarely awarded. Such ‘sledge-hammer’ approaches to ‘‘reforming’’ such legal

standards, while politically satisfying, are

only coincidentally related to thoughtful

policy-making.

It is, in our view, remarkably arrogant for

legislators to substitute their prospective

judgments regarding equitable outcomes for

specific factual cases yet to arise for the

judgment of juries, which, by definition, can

examine each case on its own unique, and

prospectively unknowable, facts. How can

anyone think they can be more fair regarding situations yet to occur than can juries

with the benefit of hindsight?

We repeat our opposition to these unnecessarily broad attempts to weaken the preventative impacts of the common law.

Very truly yours,

JAMES L. BROWN,

President.

WISCONSIN CITIZEN ACTION,

Milwaukee, WI, April 21, 1995.

Hon. RUSS FEINGOLD,

U.S. Senate, Hart Senate Office Building,

Washington, DC.

DEAR SENATOR FEINGOLD: On behalf of our

103,000 members and our coalition of 110

labor, senior, religious, environmental, women’s, farm and community organizations, we

are writing to urge you to oppose S. 565 and

to vote against cloture. We very much appreciated your help last year in the defeat of S.

687, this bill’s predecessor. We’re confident

we can count on you again.

This bill is very similar to the product liability ‘‘reform’’ Bob Kasten used to push

when he represented Wisconsin in the United

States Senate. We like to think that one of

the reasons why Wisconsin voters chose not

to re-elect Bob Kasten to the Senate is because they repudiated his consistently anticonsumer positions. S. 565 is similarly out of

step with the interests of Wisconsin consumers.

The provisions in this bill cannot claim to

be ‘‘moderate.’’ A punitive damage cap of

$250,000 or three times the economic loss to

a victim of an injurious product is no more

than a slap on the wrist to the corporations

responsible for the deaths and injuries

caused by products like the Ford Pinto, the

Dalkon Shield, silicone-gel breast implants

and flammable baby pajamas. The manufacturer of the ‘‘Slip ’N’ Slide’’ water slide,

which caused a 35-year old Wisconsin mechanic to break his neck, become temporarily quadriplegic and suffer permanent

spasms, would have had its punishment reduced to one-thirtieth of what a jury

thought appropriate. The U.S. Senate would

be changing the punishment so that it cannot possible fit the crime in an era of public

sentiment to get tough on wrongdoers.

We have no idea how many similar horror

stories like those are waiting to happen. Corporate wrongdoers would face a dollar and

cent deterrent too cheap to stay their pursuit of profit without regard for consumer

health and safety. The temptation for corporations to proceed with dangerous products, even if they are eventually found guilty

in a lawsuit, would get that much easier. S.

565 will weaken the ability of our civil justice system to act as both deterrent and

remedy.

The elimination of joint and several liability for noneconomic damages discriminates

against the most vulnerable populations in

our society—women, children and seniors.

These are the members of our society who

are usually forced to claim noneconomic

losses, and these constituencies would now

be forced to shoulder the burden of being

only partially compensated. Noneconomic

damages include the loss of reproductive capacity, loss of sight and permanent disfigurement, not just ‘‘pain and suffering.’’ It is

simply unfair that a party found to be negligent should not be required to make these

vulnerable people whole after they have been

injured.

The U.S. Consumer Product Safety Commission once estimated that some 33,000,000

people are injured by defective or dangerous

products every year. 29,000 of them die. Only

1.6% of the injured parties sue. S. 565 solves

no problem in our civil justice system, but it

will create a very real human toll if it is allowed to pass. We respectfully urge you to

vote against the bill and to vote against cloture.

Thanks once again for your outstanding

leadership in defeating the anti-consumer

product liability ‘‘reform’’ bill in last year’s

Congress. We appreciate all your help in continuing that effort by defeating this bill

again, albeit in a tougher political climate.

Thank you for attention in this matter.

Sincerely,

LARRY MARX,

Executive Director.

CENTER FOR PUBLIC

REPRESENTATION, INC.,

Madison, WI, April 21, 1995.

Re Senate bill 565.

Senator HERB KOHL,

Washington, DC.

DEAR SENATOR KOHL: As you know S. 565,

the misleadingly-named ‘‘Common Sense

Product Liability and Legal Reform Act of

1995’’ will soon be considered by the Senate.

As one of the major consumer advocacy

groups in Wisconsin, we urge you to oppose

this anti-consumer measure.

While certain aspects of our tort system

are certainly in need of reform, this bill totally misses the mark. Instead of protecting

consumers from some of the excesses of our

legal system, it would protect manufacturers

of defective products from assuming full responsibility for their actions. Seizing upon

such highly publicized and distorted cases

like the ‘‘burning McDonald’s coffee’’ proponents of this measure (as well as similar

proposals in numerous state legislatures including Wisconsin) would eviscerate the ability of our legal system to effectively enforce

rules on product safety and punish those who

violate them.

The proposed restrictions on punitive damages are completely counter-intuitive. By

encouraging corporations to produce safe

products, punitive damages (which, insurance industry rhetoric notwithstanding, are

rarely awarded by juries or upheld on appeal)

actually help corporations save money. Safe

products mean fewer, not more lawsuits.

Safe products mean fewer, not more medical

insurance claims filed by consumers. Safe

products mean fewer government recalls.

And safe products mean an improved quality

of life for all consumers.

The elimination of joint and several liability for non-economic damages is also misplaced. On first blush, this common law concept may seem unfair; why should one corporation that is only slightly liable have to

pick up the tab for a more culpable corporation that happens to be insolvent? But when

you look closer, joint and several liability is

the fairest resolution to a difficult dilemma.

It looks at all of the parties involved in a

products liability lawsuit and decides that

the costs should be spread so as to fully compensate the victim who, after all, is the only

innocent party. And since non-economic

damages are frequently awarded to the most

vulnerable members of society; the poor,

young children, senior citizens, this provision would affect such groups disproportionately.

The elimination of liability for products

more than twenty years old is also unfair to

consumers. Again, this provision would disproportionately harm the most vulnerable

consumers, since they rely more heavily on
S6392 CONGRESSIONAL RECORD — SENATE May 10, 1995

older, used products. The anti-consumer nature of this bill is especially apparent in this

provision, since it exempts companies who

suffer commercial losses.

Another particularly disturbing provision

in S. 565 from the Wisconsin perspective is

its preemption of state consumer protection

laws. As you know, Wisconsin is a national

leader in the area of consumer protection.

Its well-deserved reputation in this area has

been built up over many decades. S. 565

would tarnish that image and bring Wisconsin down to the lowest common denominator

in protecting its citizens from consumer

abuse.

There are other consumer-unfriendly aspects to S. 565, including its exemption from

liability for the sellers of products and the

special treatment provided for suppliers of

materials for medical devices. Moreover, the

bill exempts corporations from many of the

restrictions on damages which it imposes on

individual consumers.

Consumer groups in Wisconsin and around

the country have fought long and hard over

the past few decades to insure that consumers have access to safe and effective products. S. 565 would annul much of this hard

work in one fell swoop. On behalf of all of

Wisconsin’s consumers, we urge you to oppose it.

Thank you.

Yours truly,

STEPHEN E. MEILI,

Director, Consumer Law Clinic.

Mr. HOLLINGS. There it is. I did not

want to really fill up the RECORD, but

every responsible, credible consumer

entity in any of the 50 States is opposed to this initiative, and the other

side knows it. But they come around

and talk balance and they talk consumers and they say you cannot

produce products.

I ask unanimous consent to insert in

the RECORD these two advertisements

by the pharmaceutical companies, February 23, 1995, and April 5, 1995, in the

Washington Post.

There being no objection, the material was ordered to be printed in the

RECORD, as follows:

[From the Washington Post, Feb. 23, 1995]

DRUG COMPANIES TARGET MAJOR DISEASES

WITH RECORD R&D INVESTMENT

Pharmaceutical companies will spend

nearly $15 billion on drug research and development in 1995. New medicines in development for leading diseases include: 86 for

heart disease and stroke, 124 for cancer, 107

for AIDS and AIDS-related diseases, 19 for

Alzheimer’s, 46 for mental diseases, and 79

for infectious diseases.

[From the Washington Post, Apr. 5, 1995]

WHO LEADS THE WORLD IN DISCOVERING

MAJOR NEW DRUGS?

Between 1970 and 1992, close to half of the

important new drugs sold in major markets

around the world were introduced by U.S.

pharmaceutical companies. And here at

home, the drug industry has been making 9

out of every 10 new drug discoveries. So

when a breakthrough medicine is created for

AIDS, heart disease, Alzheimer’s, stroke,

cancer or any other disease, chances are it

will come from America’s drug research

companies.

Mr. HOLLINGS. Just the one in February, one statement:

Pharmaceutical companies will spend

nearly $15 billion on drug research and development in 1995.

According to the Senator from Washington, they cannot spend. They just

cannot work anymore with this law.

And right here in April:

Between 1970 and 1992, close to half of the

important new drugs sold in major markets

around the world were introduced by U.S.

pharmaceutical companies. And here at

home the drug industry is making nine out

of every ten new drug discoveries. Breakthrough medicines that are going to be created for AIDS, heart disease, Alzheimer’s,

stroke, cancer, or any other disease will

come from the American drug companies.

But according to the Senator from

Washington, they cannot bring out

products. Come on. They have tried

every trick in the book.

What we really have afoot, Mr. President, when they cite the Constitution

is just that—an assault against the

constitutional right of trial by jury

guaranteed by the seventh amendment.

People who say they do not trust politicians anymore are waiting for the

politicians to behave as though they

trust the people. You and I trust them

to elect us, but when they get us 12

men and women on a jury sworn to listen to the facts and make their finding,

according to their sworn oath, ‘‘They

do not know what they are doing; they

have gone ape; they are just runaway

juries,’’ and everything else of that

kind.

But we up here, the bureaucracy in

Washington, we should decide rather

than letting the juries decide back

home.

We have a right, Mr. President, that

has worked over the many, many

years. You have safe drug products.

Thank heavens, we have product liability and we have taken off Dalkon

shield and all the rest of these other

things—cancer causing products. We

have safer automobiles.

Why do you think Chrysler the other

day said they were going to recall I

think some 350,000 or several million

cars? I had the summation. Seventyone million automobiles in the last 10

years, American and foreign manufacture, have been recalled. They do not

recall them because of the goodness of

their heart. They recall them on account of product liability. What we

have in hand here they want to destroy. We have always had in this land

‘‘salus populi suprema lex.’’ Safety of

the people is the supreme law.

Now they come with this measure,

the profits of the manufacturers is the

supreme law, and whine that they are

for the consumers and they cannot put

out products.

How does this come about? I have

been in this for 40 years and I have

watched it develop: Pollster politics.

They tell you when you come to this

national office up here that you have

to get a poll and get to four or five hotbutton items and then you have to

identify with them. You are for jobs,

everybody is for jobs; you are against

crime; you are against taxes. They just

go down the list.

Then they tell you, and in fact

GOPAC puts on a school over there for

the young Congressmen that are elected, they say, ‘‘You have only got a 20-

second time bite to give your message,

so you need words that count, words

that excite, inflame.’’

And do you know what they call us

up here now? I quote the Speaker. He

terms the U.S. Government that

pledged to preserve, protect, and defend, he calls it the corrupt liberal welfare State.

And when you can come in this antiGovernment drive with the Contract

With America and you see it in the

morning paper and if you read it closely, it is gone: ‘‘Get rid of the Government. The Government is not the solution, the Government is the problem.

The Government is the enemy.’’

That has been the drumbeat. If you

can wrap it together in tort reform,

you can get against the lawyers and

against the Government both and you

can really have a winner.

Well, for 15 years we have defended

against this assault. President Ford

helped us 15 years ago. He appointed a

commission. And when President Ford

appointed that commission, they had a

4-year study that came out and found

that the States for 200 years have been

handling this properly, basic tort law.

Incidentally, of all the civil findings,

only 9 percent are tort. And of all the

tort, only 4 percent of the 9 percent, or

0.38, thirty-eight one-hundredths of 1

percent of what we are supposed to be

dealing with. It is not a problem at all.

They said the States were handling

it. And now we know by record in the

hearing that the States have reformed,

they have acted. The legislators are

not asleep, the Governors are not

asleep, the attorneys general are not

asleep back in the States. They can

handle this problem. That is the plea of

the contract in reality. Get all of these

things, housing grants, block grants to

the States, welfare block grants, whatever it is. Give it back to the States.

Not on this one. You are in the hands

of the Philistines, that manufacturing

crowd out there—the Conference

Board, the NFIB, the Chamber of Commerce.

I have been elected six times and

they do not come running.

That crowd that we have, they come

running. Yes, the Chamber wants to

know where you stand, the NFIB, the

Conference Board, everything else.

They talk about trial lawyers giving

you money. They give money but the

others, the manufacturing and insurance crowd, they give more money and

they have the votes.

And the people who really oppose

this bill do not have a PAC. Have you

ever seen a PAC for the American Bar

Association? Have you ever seen a PAC

for the Consumer Association, Public

Citizen, Association for State Supreme

Court Justices, Association of State

Legislators, law school deans—they

have all appeared in the polls—the

State attorneys general? They do not

have PAC’s.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6393

But there they come with all this.

And we have been working with them,

but we have the contract now. And we

have had many of these Senators that

finally changed their votes who said,

‘‘You know, I got in trouble. I committed a year ago.’’

That is how it happens, if people

want to know. When all the powerful

organizations come to you in a campaign and you are for reform—‘‘Yeah,

I’m for reform. I’m for reform.’’ They

have been reminded in the last several

days in this debate here how they gave

their commitment.

So I went to them, I said, ‘‘How do

you change your vote?’’ They said,

‘‘Well, I got in trouble a year ago or 2

years ago when I was running.’’ And

that explains it. But it does not change

the lack of merit in this particular initiative and the danger of it all.

So what we have is ‘‘Kill all the lawyers.’’ You could see it in the amendments. That is what they have.

Our friend Dan Quayle started that

before the American Bar Association

some 4 years ago and we still have it

going. If you can vote against the lawyers and say they are running away

and getting all the money and everything else like that, you have mob action on foot and you can get it moving.

Well, Mr. President, it is bad law.

What happens is they do not give you a

Federal cause of action. If they had

come in—and I have been insisting for

the 15-year period, if you want to make

a finding under the interstate commerce clause that they plea, that we

are going to make a congressional finding that there is a national problem

and give a Federal cause of action, that

is one thing. No, that is not what they

want. They say they are trying to get

simplicity, eliminate complexity, get

uniformity. But then they put guidelines down for the 50 States to interpret and then can go into the Federal

court and, by the way, exempt the

manufacturer. Any of these things that

I have talked of, any of these initiatives, any of these amendments, just

exempt the crowd that wrote the bill.

Now I can tell you here and now if

that is not hypocrisy, I do not know

what the heck is. And yet they are saying they are proud now and they want

to thank everybody, tell them about

their balance and everything else like

that.

This is one of the most dangerous initiatives. It has been held up for 15

years by all of these organizations. It

is a nonproblem. They know it. It is a

solution looking for a problem, in all

reality.

And we are headed, yes, with the

English rule, we are headed with two

levels of society. ‘‘Get rid of the jurors

and people with common sense back

home. We know it all up here.’’

They started over 130 years ago diminishing that guaranteed right of

trial by jury. So today, less than 2 percent of civil cases go to a jury trial in

England. And you are told that the issues are too complex, you do not have

sense enough to understand and what

have you. And that is the initiative

that starts today on the floor of the

U.S. Senate.

They know in their hearts it is bad

law. They have tried everything from

the Girl Scouts, and had to withdraw

that; they tried the Little League and

had to withdraw that. They put George

McGovern on TV and had to pull him

off. They tried everything—the McDonald’s case, then when that was explained to them, you do not hear them

talk about the McDonald’s case. Always these little anecdotal things that

they bring up.

But they got one winner: ‘‘Let’s get

rid of the lawyers.’’ We can get a majority vote on that. We can get a majority vote on that. And so it is.

In essence, what you are really doing

is getting rid of the jurors. The trial by

jury, they are eroding it, nibbling at it

bit by bit is the intent and purpose,

just like they had in England where

you do not even get a review of facts or

anything else. You cannot even ask the

jurors any questions; you cannot find

the background.

I could go down the list, but my time

is now limited and I am practically out

of time.

I simply say that it is a sad day in

the history of government because it

brings to culmination the so-called

contract of reform which goes totally

in contradiction to the entire theme of

the contract back home. The people

know—you are going to hear it now in

the budget. The people back home need

a tax cut because they know how to

spend the money better than the Government up here. All of these pleas and

everything. The people back home

know this, they know that, they know

everything except the facts of the case

that they are sworn to uphold.

The PRESIDING OFFICER. The Senator’s time has expired.

Mr. HOLLINGS. I yield the floor.

Mr. GORTON. Mr. President, again,

for the information of Members, we

will now have the vote on my motion

to table the Dorgan amendment.

There are then two other amendments, all amounting to the same

thing, that will come before final passage. I hope that those two amendments will be adopted by voice vote. I

will then ask for a rollcall on final passage of the bill.

The PRESIDING OFFICER. Under

the previous order, the question occurs

on agreeing to the motion to table

amendment No. 629 offered by the Senator from North Dakota [Mr. DORGAN].

The yeas and nays have been ordered.

The clerk will call the roll.

The assistant legislative clerk called

the roll.

Mr. LOTT. I announce that the Senator from Virginia [Mr. WARNER] is

necessarily absent.

Mr. FORD. I announce that the Senator from Connecticut [Mr. LIEBERMAN]

is absent because of death in the family.

I further announce that, if present

and voting, the Senator from Connecticut [Mr. LIEBERMAN] would vote ‘‘yea.’’

The PRESIDING OFFICER. Are there

any other Senators in the Chamber desiring to vote?

The result was announced—yeas 54,

nays 44, as follows:

[Rollcall Vote No. 160 Leg.]

YEAS—54

Abraham

Ashcroft

Bennett

Bond

Brown

Burns

Campbell

Chafee

Coats

Cochran

Coverdell

Craig

DeWine

Dodd

Dole

Domenici

Exon

Faircloth

Frist

Glenn

Gorton

Gramm

Grams

Grassley

Gregg

Hatch

Hatfield

Helms

Hutchison

Inhofe

Jeffords

Johnston

Kassebaum

Kempthorne

Kyl

Lott

Lugar

Mack

McCain

McConnell

Murkowski

Nickles

Nunn

Pell

Pressler

Robb

Rockefeller

Santorum

Smith

Snowe

Stevens

Thomas

Thompson

Thurmond

NAYS—44

Akaka

Baucus

Biden

Bingaman

Boxer

Bradley

Breaux

Bryan

Bumpers

Byrd

Cohen

Conrad

D’Amato

Daschle

Dorgan

Feingold

Feinstein

Ford

Graham

Harkin

Heflin

Hollings

Inouye

Kennedy

Kerrey

Kerry

Kohl

Lautenberg

Leahy

Levin

Mikulski

Moseley-Braun

Moynihan

Murray

Packwood

Pryor

Reid

Roth

Sarbanes

Shelby

Simon

Simpson

Specter

Wellstone

NOT VOTING—2

Lieberman Warner

So the motion to lay on the table the

amendment (No. 629) was agreed to.

Mr. GORTON. Mr. President, I move

to reconsider the vote.

Mr. GRAMM. I move to lay that motion on the table.

The motion to lay on the table was

agreed to.

TOXIC HARM

Ms. MIKULSKI. Are asbestos-related

injuries and deaths covered by the

toxic harm exception to the statute of

repose in S. 565?

Mr. ROCKEFELLER. Yes, asbestosrelated injuries and deaths are covered

by the toxic harm exception to the

statute of repose.

AMENDMENT NO. 790

Mr. HATCH. Mr. President, I wish to

discuss language in the Gorton-Rockefeller-Dole substitute amendment concerning punitive damages. The substitute language includes a formula for

calculating the amount of punitive

damages allowed to be awarded to a

claimant against a defendant. This formula originated with Senator SNOWE

and was added to the Dole-Exon-Hatch

amendment last week, with my support. It remains part of the underlying

substitute amendment. The formula to

which I refer provides generally that

the amount awarded to the claimant

for punitive damages in a products liability action shall not exceed the

greater of two times the sum of the

amount awarded for economic loss and
S6394 CONGRESSIONAL RECORD — SENATE May 10, 1995

noneconomic loss, or $250,000. In the

case of a small business, a special rule

provides that the amount of punitive

damages shall not exceed the lesser of

two times the sum of the amount

awarded to the claimant for economic

loss and noneconomic loss, or $250,000.

It is my understanding that the formula for calculating the amount of punitive damages is intended to take into

account the separate provision in the

bill that makes a defendant only severally liable for noneconomic losses.

Thus, when doubling the amount of

noneconomic losses in computing the

upper limit of punitive damages which

may be awarded against a defendant, it

is appropriate only to consider the

share of noneconomic loss attributable

to that defendant. It would be unfair

and inconsistent with other provisions

in this act to expand the base multiplier in the punitive damages section

of this bill to include noneconomic

losses not attributable to a defendant.

Mr. HELMS. Mr. President, the pending Product Liability Fairness Act,

even though it has been watered down

considerably by our Democrat colleagues, is nonetheless needed to remedy the morass of product liability

laws plaguing our judicial system

today. We have a duty to ensure that

Americans are fairly compensated

when they are injured by faulty products. But today’s legal system has been

maneuvered into a position of encouraging many people to file frivolous

suits demanding unreasonably high

damage awards.

I am extremely disappointed that the

medical malpractice provisions, approved by the Senate on May 2, were

deleted because of threats by the

Democrats that they would block passage of the entire bill.

Americans are suing each other too

often, for too much money and for too

little reason. Last year, more than

70,000 product liability lawsuits clogged

U.S. courts. And by 1992, lawyer fees

accounted for 61 percent of the total

amount spent on product liability

claims.

In so many cases, those who are injured least tend to receive the largest

settlements, while many of the most

severely injured spend years in the

legal system, sometimes never receiving the compensation they deserve.

Mr. President, the pending legislation will be a first step toward remedying these problems with the current

system by:

First, giving manufacturers and consumers certainty as to the rules of the

game when it comes to product liability lawsuits;

Second, allowing consumers with

valid claims to receive fair awards, and

receive these awards faster;

Third, reducing costs of litigation

and insurance premiums, which in

turn, will lead to lower prices for

consumer products;

Fourth, giving consumers with valid

claims more time to file complaints

against negligent manufacturers; and

Fifth, eliminating unwarranted lawsuits which threaten to bankrupt small

businesses—the segment of our economy that provides most of the jobs in

this country.

Mr. President, rather than expound

on the problems with the current system, I will share with my colleagues a

letter from the plant manager of Butler Manufacturing, a small business in

Laurinburg, NC. His letter is similar to

many I have received from 99 other

small businessmen from my State. It

reads:

DEAR SENATOR HELMS: As you know, Butler Manufacturing has a plant in Laurinburg,

North Carolina which employs two hundred

workers. We urge your support of S. 565, the

Product Liability Fairness Act, which offers

some of the reforms needed in the product liability area.

Our company spends hundreds of thousands

of dollars each year for product liability insurance and legal fees and our employees devote hundreds of hours of their time to help

our attorneys defend unwarranted product liability claims.

Many times we settle a claim which we

honestly believe has little merit because it is

less expensive to settle than to litigate or to

expose the Company’s assets to punitive

damages.

Our Company competes in the international market place. To be competitive we

cannot bear the cost of product liability insurance, huge punitive damage expense, and

large costs to defend unwarranted claims

which our competitors do not bear.

We believe persons injured by faulty products through no fault of their own ought to

be compensated for their out-of-pocket

losses. However, current court-made rules

allow much greater compensation than is

justified and also make it difficult for companies to properly defend themselves.

Mr. President, this explains why

small businesses—not the Fortune 500

companies—are the ones most threatened if nothing is done to reform the

current legal system.

According to the National Federation

of Independent Businesses, the cost and

availability of liability insurance rank

No. 5 out of a list of 75 problems facing

small businesses today. They are constantly in danger of being pulled into

unwarranted lawsuits, where the fear

of punitive damages forces them to settle in cases in which they should never

have been involved.

About half of all small business owners earn about $50,000 a year. However,

a Rand Institute study shows that it

costs the same small businessman an

average of $100,000 to defend against a

lawsuit—regardless of the suit’s merit.

Thus, defending even a single unwarranted lawsuit costs twice as much as

the average small business owner earns

in a year.

Perhaps the most critical problem for

small businesses is something lawyers

know as joint and several liability,

which permits plaintiffs to recover the

full amount of damages from any one

of the defendants—regardless of the

amount of fault of the individual defendant. So, even if a small businessman is responsible for only 10 percent

of the damage caused the plaintiff,

under the current system, that businessman can still be held liable for 100

percent of the damages. The pending

bill fixes this problem by holding a defendant liable for the percentage of

noneconomic damages for which he or

she is responsible.

Mr. President, I have many friends

who are trial lawyers. They have made

some compelling arguments in favor of

the current system; however, in this

matter, we have had to agree to disagree.

For example, trial lawyers argue

that: First, limits on punitive damage

awards are unnecessary because courts

don’t frequently award punitive damages; and Second, when they are awarded, punitive damages generally do not

amount to very large sums.

As every first year law student

knows—or should know—there are

three kinds of damages awarded in

civil lawsuits.

The first—economic damages—reimburses an injured person for lost wages,

medical care, and out-of-pocket costs

incurred as a result of the injury.

Second—noneconomic damages—are

awarded for things such as pain and

suffering, and

Finally, there are punitive damages.

The purpose of punitive damages is not

to compensate the injured person, but

rather to punish the defendant for his

or her negligent behavior. Most of the

disagreement in the pending bill surrounds punitive damages.

Mr. President, are punitive damages

rarely awarded as trial lawyers claim?

No. Injured parties routinely request

punitive damages in product liability

and other tort claims. They do so because they know that’s where the big

bucks are. Not only are punitive damages routinely requested, the amount

of punitive damages awarded is increasing. In Cook County, IL, the average punitive damage award was $6.7

million. In 1984, the average punitive

award in San Francisco was $743,000.

In North Carolina punitive damages

have been awarded only once. Despite

this fact, any time a product manufactured in North Carolina ends up in another State, the North Carolina manufacturer can still be hauled into an outof-State court and sued for outrageous

punitive damage amounts.

Mr. President, trial lawyers also assert that product liability reforms are

unnecessary because so very few lawsuits filed today are product liability

cases. They claim that contract disputes and domestic relations cases

make up more of the current case load

in today’s courts.

That product liability cases make up

a small piece of all tort cases ignores

one important and critical point: It

only takes one product liability lawsuit to bankrupt a small manufacturing firm. Even if the manufacturer is

not found negligent, it still costs that

small business a small fortune to defend the lawsuit.

Lastly, lawyers argue that product

liability reform will not lower liability
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6395

insurance premiums that manufacturers pay. I disagree. Over the past 40

years, liability insurance costs have increased 4 times the rate of growth of

the national economy.

Moreover, for every extra dollar a

company pays in product liability insurance, that’s a dollar less in an employee’s pocket, or a dollar less used to

develop new products.

In closing, let me return to the letter

from the plant manager in Laurinburg,

NC. This is a small business pleading

for fairness and for an opportunity to

compete fairly for business. If this

plant, and the other 99 small businesses

who’ve written me, are to prosper, they

cannot afford to defend unwarranted

claims every time they turn around.

We cannot continue to tie the hands

of small businesses by forcing them to

defend case after case in a legal system

that is unfair, inconsistent, and unpredictable. The pending bill does nothing

to impede an injured person’s right to

recover reasonable damages for his or

her injuries. Nor does the bill favor any

particular industry. It simply weeds

out frivolous and unwise lawsuits,

making it easier and for injured individuals to obtain the recovery they deserve.

PRODUCT LIABILITY—STATES’ RIGHTS AND ONEWAY PREEMPTION

Mr. FEINGOLD. Mr. President, I rise

to briefly discuss one of the more interesting—and most distressing—components of S. 565, the so-called Product

Liability Fairness Act. That, Mr.

President, is the conscious and flagrant

expropriation of the rights of the State

and local governments to fashion their

own civil justice systems.

Over and over in the early months of

the 104th Congress we have heard the

distinguished majority leader announce his intent to ‘‘dust off the 10th

amendment’’. That amendment, part of

the Bill of Rights and sometimes

thought of as the forgotten child of the

Bill of Rights, states that:

The powers not delegated to the United

States by the Constitution, nor prohibited

by it to the States, are reserved to the

States respectively, or to the people.

Well, here is a power that has been

reserved by the States for over 200

years. And I cannot help but note the

hypocrisy present here. We have heard

the thunderous voices of States rights

advocates, railing against Washington

bureaucrats and proclaiming that this

new Congress is committed to the proposition of shifting control of policies

from Washington back to the States.

But then many of the same advocates

of States rights also support legislation such as this that is designed to

seize control over a policy area that

has been the domain of the States since

our Nation’s founding and turn it over

to 535 Members of the Congress.

Make no mistake about it: Under this

legislation, we are going to tell the

States—even in instances where there

is no Federal jurisdiction over a tort

case—the parameters within which

they are to conduct their judicial proceedings.

That means that if a consumer in

Sheboygan sues a manufacturer in

Green Bay, they will have to litigate

under Federal standards, such as a Federal cap on punitive damages, even

though this is a completely intrastate

judicial question.

There is also a provision that states

that a decision of a U.S. circuit court

of appeals interpreting the provisions

of this legislation shall be controlling

precedent to be followed by each and

every Federal and State court within

that circuit unless overruled or modified by the Supreme Court.

This provision was denounced by

Stanley Feldman, chief justice of the

Arizona State Supreme Court in his

testimony to the Senate Commerce

Committee on April 3 on behalf of the

conference of chief justices. Chief Justice Feldman said that:

. . . This provision will be the first time in

the history of America that any Federal

court has been given the authority to decide

a question of State law, a subject which

raises the chills on the back of every member of the conference of chief justices.

What happened to the commitment

of those on the other side of the aisle

to return power back to the State governments? What happened to all of

those criticisms we heard of health

care reform and other initiatives last

year where the other side derided the

one-size-fits-all approach to solving

problems?

When I made my opening statements

on this bill I mentioned a statement

made by the Speaker of the House in

his address to the Nation on April 7

about the intent of the congressional

Republicans in the 104th Congress. The

Speaker stated that:

We must restore freedom by ending bureaucratic micromanagement here in

Washington . . . This country is too big and

too diverse for Washington to have the

knowledge to make the right decision on

local matters; we’ve got to return power

back to you—to your families, your neighborhoods, your local and State governments.

Mr. President, I don’t say this very

often, but when the Speaker of the

House says: ‘‘This country is too big

and too diverse for Washington to have

the knowledge to make the right decision on local matters,’’ I tend to agree

with him.

That is precisely why I opposed last

year’s crime bill. Enforcement of our

criminal laws is best left in the hands

of our local police and sheriffs’ departments, because what works and is

needed in the inner city of Milwaukee

is not necessarily what works and is

needed in the rural confines of Rusk

County. It is problematic enough for a

Senator from Wisconsin to understand

these regional distinctions, but to suggest that 524 Members of Congress from

49 other States will know how to address the idiosyncrasies of fighting

crime in Onalaska, WI, seems a bit farfetched to me.

This same principle holds true for

our tort systems. Maybe one of our

rural farming States has purposely

fashioned their legal system so as to

protect farmers from defective machinery that is commonplace in that State.

Maybe another State that attracts

large numbers of retired persons has

used the availability of punitive damages to deter certain products from

being sold that are unsafe and would

disproportionately affect the elderly.

The other side talks a good game

when it is expressed over and over

again that State legislatures and governments are best equipped to solve

problems that are local in nature. But

whether it is crime legislation, or civil

justice reform, or even term limits,

there is a clear assumption that local

or private decisions are best made by

those in Washington, DC.

I served in the Wisconsin State Senate for over 10 years and I know how

the various State legislatures around

the country would react to this bill. In

fact, the national conference of State

legislatures strongly opposes the Product Liability Fairness Act. In a letter

sent to all Members of this body, the

conference states:

State civil justice systems are expressions

of local values and needs, as the Founders intended when they established our system of

Constitutional federalism. National product

liability standards put at risk this fundamental expression of self-government and

federalism.

Moreover, the confusion resulting from

superimposing a one-size-fits-all Federal

standard for product liability over existing

State tort law presents a risk to the efficient

administration of justice in State courts.

Mr. President, I think it is abundantly clear that the notion of States’

rights is about to go right out the window as we usurp over 200 years of State

control over their tort systems. Another organization comprised of those

who are involved in local judicial systems is the conference of State chief

justices. Let me quote from a statement submitted by the chief justices

expressing their opposition to Federal

product liability legislation. They say;

The negative consequences of S. 565 for federalism are incalculable. With the proposed

legislation reaching so far into substantive

civil law, States will be forced to provide the

judicial structure, but will not be permitted

to decide the social and economic questions

in the law that their courts administer. Enactment of S. 565 would alter, in one stroke,

the fundamental principles of federalism inherent in this country’s tort law. . . .

S. 565 is a radical departure from our current legal regime and is neither justified by

experience nor wise as a matter of policy.

So I think it is clear what a dramatic

and radical arrogation of power this

legislation represents. But even if you

accept this notion that we should have

Federal standards with regard to product liability actions—and I don’t—but

even if you do believe such standards

are necessary, this legislation is lightyears away from bringing any sense of

uniformity to our civil justice system.

The supporters of this legislation

have made it clear that they believe

Federal uniform standards for our

product liability laws are warranted,
S6396 CONGRESSIONAL RECORD — SENATE May 10, 1995

presumably to address the supposed uncertainty and unpredictability of our

legal system.

Those of us on the other side disagree. We believe the system was designed to protect innocent consumers

who have been injured by defective

products, and more importantly, we

are reluctant to usurp the authority of

the States over an area that for 200

years has been the domain of the State

legislatures.

As I stated earlier, many of us are

also bewildered as to why some would

make changes to the legal system that

are opposed by the National Conference

of State Legislatures, the Conference

of Chief Justices, the American Bar Association and law professors throughout the country.

But I think it is important to point

out the great fallacy in the notion that

this bill provides uniform Federal

standards. It clearly does not. What it

does provide, is a line in the sand. This

bill says that State laws and State reforms that are designed to protect consumers, children, working people, and

the elderly are no longer applicable.

It says that those States do not know

how to protect consumers—we here in

Washington, DC know best how to do

that. If you are on that side of the line

in the sand, well sorry but you are out

of luck because apparently it is the

Congress that knows best how to protect farmers in Iowa, factory workers

in Michigan, and children in California.

But if you are on the other side of

that line, if there are State laws or

State reforms that are designed to protect the interests of the business and

manufacturing communities, well

those are OK. This bill says that those

State legislatures know exactly what

they are doing and we should not preempt any of their efforts.

These are uniform Federal standards?

Let me raise a couple of examples to illustrate just how unfair and unbalanced the bill is in this regard. The punitive damage cap is an obvious example. The underlying bill calls for a cap

on punitive damages equal to the

greater of two times compensatory

damages of $250,000. In addition, under

certain circumstances a judge may

award supplementary punitive damages

above the amount the jury has rewarded.

I think the layperson would look at

this provision and assume that this

cap—a Federal cap of $250,000 or two

times compensatory damages—would

apply across the board. In other words,

whether you were injured by a defective product in Wisconsin, New York,

or Mississippi and filed suit in any of

those State courts, a jury would be

able to award punitive damages of up

to $250,000 or two times compensatory

damages.

Unfortunately, especially for those

who support uniformity, that is not

what this legislation would do. Under

the now-amended bill, the punitive

damage cap would not preempt, supersede, or alter any State law to the extent that such law would further limit

the availability or amount of punitive

damages. Those State laws would not

be preempted.

In other words, if a State allowed unlimited punitive damages, or even had

a cap but that cap was higher than this

new Federal cap, that State law would

be preempted by this legislation.

But if a State prohibited punitive

damage awards, or had a cap lower

than the cap in the underlying bill,

that State law is hailed as responsible

and fair and allowed to continue under

this legislation.

I wonder if any of my colleagues are

familiar with the ‘‘Slip ’n Slide’’ case

we had in Wisconsin just a few short

years ago. The Slip ’n Slide is a sort of

water slide that is spread out over the

ground. You are supposed to get a good

running start, jump head first on the

wet plastic and then slide along the

rest of the wet plastic. It was a product

that was manufactured for families and

obviously, targeted especially for children.

The plaintiff in this case, a 35-yearold father of two, dove onto this water

slide, struck his chin on the ground

and broke his neck. He was rendered an

incomplete quadriplegic. The plaintiff

was unable to return to his $12,000 a

year job and had no means to pay the

$46,000 in medical bills he was saddled

with.

During the trial, the plaintiff alleged

that the product was unreasonably

dangerous for its intended purpose.

This was compounded by the fact that

the water slide’s warnings were inadequate because they were not prominently displayed among the product’s

list of instructions and warnings.

Testimony was presented showing

that other users had experienced similar injuries and one individual had even

died from such an accident. It was also

made clear that the manufacturer continued to market the product even

after it was made aware that numerous

neck injuries such as this were occurring.

Let me say that again; the facts

showed that the manufacturer knew

the product was causing neck injuries

and yet still continued to market the

product.

The jury in this case, in a Wisconsin

State court, found that the manufacturer was 100 percent at fault and

awarded over $12 million to the plaintiff, including $10 million in punitive

damages. This judgment was later reduced so that the plaintiff and his family in the end received about $5 million.

We know what the other side’s response to this is; ‘‘$10 million? That

jury must be out of control.’’

Some of us, however, have faith in

the ability of the American people to

serve on juries and administer justice

in a fair and equitable manner.

You can bet, Mr. President, that the

manufacturer of the Slip ’n Slide is

thrilled about this legislation. Those

on the other side want to insulate such

companies from juries and the threat

of extensive punitive damages. Why?

Because such a large punitive damage

award might force the manufacturer to

take a product off the market that has

been considerably profitable for that

manufacturer.

But I would contend, Mr. President,

that our civil justice system is designed to do just that—to sanction parties that knowingly market a defective

product and to protect the consumers

that are victimized by these products.

That Wisconsin jury awarded a large

punitive damage award for two reasons: One, to get a dangerous product

off the market that is often used by

young children and that was causing

numerous neck injuries and paralysis;

and second, to punish the manufacturer for continuing to market the

product with knowledge of its very serious defects and to deter other manufacturers from engaging in similar conduct.

I would say that in this case, the

jury—in a State court—knew exactly

what it was doing and justice was

served.

Mr. President, the Wisconsin jury in

this case awarded $10 million in punitive damages in the slip ’n slide case. I

have no doubt that most of the proponents of this bill believe that this is

a classic case of a jury run amok.

Here is what I find interesting

though. That jury found the manufacturer in this case 100 percent at fault.

Suppose this was a criminal defendant

on trial for assault with a deadly weapon. After all, the manufacturer in this

case was marketing a product that

they knew was causing neck injuries

and paralysis.

The fact is, if this had been a criminal defendant I have no doubt that

there would have been a bidding war on

the other side to see who could propose

the stiffest criminal sentence for this

defendant.

We can only speculate about what

the fate of the Slip ’n Slide would have

been had this accident and litigation

occurred in a State that currently prohibits punitive damage awards. Most

likely, more neck injuries and maybe

some fatalities would have occurred

until a suit had been filed in a court

where punitive damages were permitted.

Had the underlying bill been in effect

4 years ago, that Wisconsin jury would

have had to award an amount consistent with the arbitrary cap. One can

only wonder if the manufacturer would

have pulled this dangerous product because of a $250,000 slap on the wrist.

Let me say this one more time: The

jury in this case—a State jury—found

the manufacturer to be 100 percent at

fault. The jury found that the manufacturer continued to market the product—a product targeted mostly at children—even after the manufacturer discovered that the product was causing

numerous neck injuries and paralysis.

The jury elected to award substantial

punitive damages to punish the manufacturer for this reprehensible behavior
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6397

and to deter other manufacturers from

engaging in similar conduct.

I say to my colleagues that this is exactly what our civil justice system,

grounded in the principle of trial by

jury, was designed to do and I am confounded as to why the supporters of

this bill are unwilling to trust those

Americans that meet their civil duties

by serving on juries.

How troubling that at a time when

Americans are so distrustful of their

Government that we in Government

are not willing to trust Americans to

administer civil justice.

Mr. President, I am somewhat mystified as to how supporters of this bill

can suggest that this bill is

proconsumer when they want to place

this kind of a straightjacket on juries.

In addition, I find it absolutely ludicrous that the supporters of this bill

would suggest that we are providing

uniformity when we are going to have

completely different punitive damage

standards throughout the 50 States.

Let me provide another example of

how this bill would pre-empt State

laws to the extent that those laws are

proconsumer.

S. 565 creates a new Federal standard

for the number of years a manufacturer

or product seller can be held liable for

a harm caused by a particular product.

Known as a statute of repose, that period is 20 years under this bill. Why 20

years? Good question.

The product liability legislation considered in the last Congress, written by

the same two principal authors, contained a 25-year statute of repose—5

years longer. Why? Well a footnote in

the committee report from last year

justified 25 years by pointing out that

according to testimony received by the

Commerce Committee, and I quote,

Thirty percent of the lawsuits brought

against machine tool manufacturers involve

machines that over 25 years old.

Therefore, presumably, the authors

of this bill selected 25 years as the life

expectancy of all products manufactured in the United States.

But now we have a new bill that the

supporters have tried to characterize

as much more moderate and much narrower than either the House-passed

legal reform legislation or the product

liability bill considered by the Senate

just last year. But remarkably, the 25-

year statute of repose has been dropped

to 20 years.

Why? Once again, good question. This

year’s committee report conspicuously

leave out that footnote about the machine tool testimony, and makes absolutely no mention whatsoever as to

why 20 years was selected.

Instead, the committee report promotes the consistency of this statute

of repose with the General Aircraft Revitalization Act of 1994, passed by this

body last year. Mr. President, I voted

for that legislation. But that legislation provided an 18 year statute of

repose for a very narrow segment of

our manufacturing base.

This body came to the conclusion,

the overwhelming conclusion as I recall that vote, that 18 years was a reasonable length of time for liability

claims associated with the general

aviation aircraft.

This statute of repose, however, is

entirely different. His 20-year period

would apply to all durable products

across the board with a few limited exceptions. Machine tools, farm equipment, football helmets—you name it.

This Congress is going to decide that

the life expectancy of virtually every

product in America is 20 years.

But this takes us back to the issue of

selective preemption of State authority over liability laws. Section 108(B)(2)

reads;

. . . If pursuant to an applicable State law,

an action described in such paragraph is required to be filed during a period that is

shorter than the 20-year period that is shorter than the 20-year period specified in such

paragraph, the State law shall apply with respect to such period.

In other words, if a state legislature

has decided against having a statute of

repose, or has decided on a statute that

is longer than 20 years, this new Federal law will override the judgment of

that State legislature. Again, so much

for uniform Federal standards.

Ironically, this year’s committee report also justifies a Federal statute of

repose on the basis that Japan is poised

to enact a short 10-year statute of

repose. So now apparently the Japanese Government knows better than

the State of Wisconsin how to properly

administer civil justice in cases involving Wisconsin litigants. I wonder how

the Framers of the Constitution would

feel about that assertion.

Before I conclude my remarks, Mr.

President, I would like to remind my

colleagues of the giant precedent we

are about to set, or the radical departure from our current system as the

Chief Justices put it. This legislation

would make dramatic alterations to

some of the oldest and most fundamental underlying principles of our judicial

system.

Product liability is just a first step—

the majority has made their intention

clear to pursue legislation that would

overhaul our entire civil justice system.

As we make these sort of tremendously consequential decisions, there

are a variety of groups and individuals

we can seek advice from. Those of us

that oppose this legislation have chosen to listen to the experts on this

issue—whether it is Chief Justices, the

American Bar Association or the National Conference of State Legislatures.

But those who support this legislation do not want to listen to State legislators, judges or even the consumer

organizations that this bill purports to

protect. Instead, the other side has

chosen to listen to the advice of corporate America on how to best to

shield those who manufacture and sell

defective products from any sort of liability. That is unfortunate for all of

us.

Thank you, Mr. President, and I yield

the floor.

Mr. DOMENICI. Mr. President, I am

pleased to support the efforts of my

colleagues today to reform our system

of products liability litigation. The

Senator from Washington [Mr. GORTON], the Senator from Utah [Mr.

HATCH], and the Senator from West

Virginia [Mr. ROCKEFELLER] deserve a

lot of credit for putting together a bipartisan approach to solving the problems associated with products liability.

I have watched this debate over the

past 2 weeks with great interest. I was

pleased to see that there was some interest in expanding this bill in order to

achieve general across-the-board legal

reform, and I supported many of the

thoughtful amendments which were

brought to the floor. I would have preferred to include the rule 11 amendment offered by the distinguished Senator From Colorado [Mr. BROWN] and

the amendment on joint and several liability offered by the distinguished

Senator from Michigan [Mr. ABRAHAM]

in any bill we might eventually pass.

But I realize that in the interest of

compromise, changes had to be made in

order to get something passed, and unfortunately that compromise will not

include comprehensive legal reform.

I am no stranger to legal reform. I

have been trying to fix our broken securities class action system for several

years, and many of the problems associated with securities litigation are inherent to our general tort system. I

also have introduced legislation in past

years to fix some of the problems associated with medical malpractice.

I am disappointed that we will not

address medical malpractice litigation

reform in this bill. The distinguished

Senator from Kentucky [Mr. MCCONNELL] and the chairperson of the Labor

Committee, the gentlewoman from

Kansas [Mrs. KASSEBAUM], did a fine

job putting together a comprehensive

and fair overhaul of our medical malpractice system. There were several

provisions in the medical malpractice

amendment which I included in my

health care reform bill last Congress,

and I believe that the amendment

would have gone a long way toward reducing health care costs for all American citizens. For that reason, I hope

that we will take up medical malpractice reform later on in this Congress.

Particularly, I would like to address

collateral source reform, which would

prevent duplicative payments by insurance companies for the same injuries. I

heard just last week from an individual

who works for a company that sells insurance in my home State of New Mexico. He told me about a case that he

just handled where a claimant was paid

five different ways for the same injury.

He told me that four ways was common, but that this was his first fiveway case. He told me that if we want to

achieve significant reform, preventing
S6398 CONGRESSIONAL RECORD — SENATE May 10, 1995

this sort of duplicative payment and

the litigation that goes along with it

will substantially strengthen our system. I hope we will continue to pursue

collateral source reform later this

year.

I also had hoped that we would be

able to include general rule 11 reform

in this bill and the Senator from Colorado, Senator BROWN, should be commended for bringing his important

amendment to the floor. Prior to 1993,

courts were required to sanction attorneys who filed a frivolous complaint,

and rule 11 served as a healthy deterrent to strike suits. However, rule 11

was weakened in 1993 and judges were

given the discretion to impose sanctions even when they found that a complaint truly was frivolous. Senator

BROWN’s amendment would return us

to the pre-1993 standard and adopt a

preference for the sanction to be payment of the attorneys fees and costs of

the opposing party.

It also would limit fishing expedition

lawsuits by requiring attorneys to

make an adequate inquiry into the

facts prior to the filing of a complaint.

Attorneys should be required to stop,

think and investigate the facts before

filing lawsuits which could have a potentially devastating effect, and Senator BROWN’s amendment would have

done just that. I believe that this issue

also should be re-visited later in the

year.

As for products liability, there can be

no doubt that the current system in

place in this country extracts tremendous costs from the business community and from consumers. The great expense associated with products liability lawsuits drives up the cost of producing and selling goods, and these

costs are passed on to the American

consumer. We have heard several Senators talk about how half of the cost of

a $200 football helmet is associated

with products liability litigation, and

how $8 out of the cost of a $12 vaccine

goes to products liability costs. We can

no longer afford to require our consumers to pay this tort tax.

Because of the high costs associated

with products liability litigation,

American companies often find it difficult to obtain liability insurance. The

insurance industry has estimated that

the current cost to business and consumers of the U.S. tort system is over

$100 billion. Insurance costs in the

United States are 15 to 20 times greater

than those of our competitors in Europe and Japan. Much of this money

ends up in the pockets of lawyers, who

exploit the system and reap huge fee

awards while plaintiffs go

undercompensated and our businesses

suffer.

For companies involved in the manufacture of certain products, like machine tools, medical devices, and vaccines, this means that beneficial products go undeveloped, or after they are

developed, they do not make it to the

marketplace out of fear of being sued.

This hampers our competitiveness

abroad, and limits the products available to consumers. Harvard Business

School Prof. Michael Porter has written about how products liability affects

American competitiveness. He wrote:

In the United States * * * product liability

is so extreme and uncertain as to retard innovation. The legal and regulatory climate

places firms in constant jeopardy of costly,

and, as importantly, lengthy product liability suits. The existing approach goes beyond

any reasonable need to protect consumers, as

other nations have demonstrated through

more pragmatic approaches.

In the case of manufacturers of vaccines and other medical devices, the

cost of our unreasonable and certainly

unpragmatic products liability litigation system often means that potentially life-saving innovations never

make it to the American public. Products liability adds $3,000 to the cost of

a pacemaker, and $170 to the cost of a

motorized wheelchair. It also has

caused the DuPont Co. to cease manufacturing the polyester yarn used in

heart surgery out of fears of products

liability litigation. Five cents worth of

yarn cost them $5 million to defend a

case, and DuPont decided that they

simply could not afford further litigation costs. Now, foreign companies

manufacture the yarn and will not sell

it in the United States out of fear of

also being sued.

In cases where a truly defective product has injured an individual, the litigation process is too slow, too costly,

and too unpredictable. This bill, because it creates a Federal system of

products liability law, will return some

certainty to a system that now often

undercompensates those really injured

by defective products and overcompensates those with frivolous claims.

Those injured by defective products

often must wait 4 to 5 years to receive

compensation. This leads victims to

settle more quickly in order to receive

relief within a reasonable time. Companies must expend huge amounts of

money in legal fees to settle or litigate

these long, complicated cases. These

again are resources that could be better spent developing new products or

improving the designs of existing ones.

Another major problem with our tort

system is with punitive damages. As

their name implies, punitive damages

are designed to punish companies and

deter future wrongful conduct. They

are assessed in these cases in addition

to the actual damages suffered by injured victims.

Unfortunately, these damages have

little effect except to line the pockets

of lawyers. They serve relatively little

deterent purpose and led former Supreme Court Justice Lewis Powell to

describe them as inviting ‘‘punishment

so arbitrary as to be virtually random.’’ Because juries can impose virtually limitless punitive damages, in

Justice Powell’s words, they act as

‘‘legislator and judge, without the

training, experience, or guidance of either.’’ Justice Powell is absolutely correct, and I applaud the drafters of this

bill for dealing with the problems associated with these types of damages.

Reform of punitive damages will return some common sense to the system. Under the current system, punitive damages do little to deter wrongful conduct and merely serve to line

the pockets of contingency fee lawyers.

Huge punitive damage awards also

threaten to wipe out small businesses

and charitable organizations. By limiting the amount of punitive damages

available in these cases and raising the

legal threshold for an award of punitive

damages, this bill will relieve some of

the pressure on even the most innocent

defendant to settle or face an award

which could potentially bankrupt the

company. It also will provide some uniformity and certainty in States which

still allow punitives. Finally, for those

States which do not allow punitive

damages, I think the bill makes it

clear that they may continue to do so.

The drafters of this bill also have

taken the wise step to reform joint liability, without limiting the ability of

plaintiffs to recover their economic

damages. The bill abolishes joint liability for noneconomic damages, like pain

and suffering, but allows States to retain it for economic damages like hospital bills. This will reduce the pressure on defendants who are only nominally responsible for the injury to settle the case or risk huge liability out of

proportion to their degree of fault,

while ensuring that injured victims get

compensated for their out-of-pocket

loss.

I would have liked to see this extended across the board to all civil

cases and I voted for the Abraham

amendment, but at least in the area of

products liability, this provision

strikes a fair balance between the

rights of injured plaintiffs and those of

those defendants brought into cases

merely because of their deep pocket.

The bill also limits liability in cases

where the victim altered or misused

the allegedly defective product in an

unforeseeable way. It simply is unfair

to hold manufacturers liable in cases

where consumers use products in ways

for which they were not intended. It

also is unfair to hold defendants liable

in cases where the plaintiff’s use of alcohol or drugs significantly contributed to their injury. I am happy to see

that this bill provides an absolute defense in such cases.

Mr. President, as I said earlier, I am

no stranger to legal reform. Many of

those who are responsible for this important and well-crafted legislation are

cosponsors of the securities reform bill

Senator DODD and I hope to bring to

the floor soon after this bill. I hope

that we can follow our colleagues in

the House and enact comprehensive but

fair legal reform in the 104th Congress.

I appreciate all of the hard work that

went into this bill and hope that we

will pass it.

Mr. GLENN. Mr. President, product

liability reform is long overdue and I

am pleased that the Senate is acting
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6399

favorably on this bill. I have cosponsored product liability reform legislation in three previous Congresses.

I believe that this legislation is good

for both consumers and businesses. Our

product liability system is out of control and reform is desperately needed.

Under our current system manufacturers of products are subject to a patchwork of varying State laws whose beneficiaries are most often lawyers instead

of litigants.

The Congress is currently debating

the proper role of the Federal Government across a broad range of issue

areas. Many believe that functions now

conducted at the Federal level should

be moved to the States. On this issue I

believe that we need a more uniform

system of product liability and therefore Federal standards are necessary.

The current system is unfair to consumers. Much too much of the money

paid by manufacturers goes to attorneys’ fees instead of the injured party.

the high cost of product liability insurance means higher costs for consumers.

Because of the unpredictability of the

current system, many severely injured

consumers receive less than they deserve while mildly injured consumers

often recover more. Furthermore, because of unpredictability, cases which

are substantially similar receive very

different results. Product liability

cases often require a great deal of time

and many claimants are forced to settle because of economic necessity.

The current system is unfair to manufacturers. The cost of litigation is a

substantial expense to companies.

Companies spend more on legal costs

and less on other important areas such

as research and development. In some

cases manufacturers decide not to invest in or develop new products because of product liability concerns. Ultimately this burden or product liability makes our companies less competitive in world markets than foreign

companies.

During the debate on this legislation,

I have been particularly concerned that

as we reform our product liability laws

we do not affect the rights of individuals to bring suits when they have been

harmed. On the contrary, it is my intent to bring rationality to a system

that has become more like a lottery.

For me, legal reform does not mean

putting a padlock on the court house

door.

There are several very important improvements that this legislation will

provide. A statute of repose of 20 years

is established for durable goods in the

workplace. After 20 years no suit may

be brought unless there is an expressed

warranty.

Joint liability is abolished for noneconomic damages in product liability

cases. Defendants are liable only in direct proportion to their responsibility

for harm. Therefore, fault will be the

controlling factor in the award of damages, not the size of a defendant’s wallet.

Another important area is punitive

damages. I am supportive of raising the

standard of proof to clear and convincing evidence. I am very concerned,

however, about the establishment of

caps on punitive damages and that the

bill not impose a one size fits all prescription. In fact this is the issue that

kept me from cosponsoring this legislation during this Congress. The bill

originally provided for a proportional

cap based on economic damages. During the amending process, that cap was

improved by including all compensatory damages. Even with that improvement, however, the bill remained

too restrictive. I support the further

inclusion of the judge additur provision

allowing an increase in punitive damage awards in especially egregious

cases.

However, I believe that an additional

provision in the additur section is

without merit. That provision would

allow a defendant another trial on

damages should additur occur. This

goes against the fundamental principles behind product liability reform—

fairness, simplification and streamlining the system. Instead, this provision

could provide a never ending litigation

cycle which will insure full employment for all lawyers. And it increases

the burden on an already overburdened

legal system. This one provision is so

egregious, that it prompted my vote

against cloture on the Gorton-Rockefeller compromise which I found otherwise acceptable. I am pleased that Senators ROCKEFELLER and GORTON intend

to address this language in conference.

Unfortunately, the product liability

legislation this year turned into a

Christmas tree attracting numerous

unrelated items that had never been in

the bill before. The expansion of the

legislation to include medical malpractice and general civil liability litigation, as Senator ROCKEFELLER has

accurately pointed out, caused the tree

to topple over. Those matters should

and will be addressed more completely

in separate legislation.

During the debate, the Senate considered several amendments addressing

medical malpractice. I believe action is

needed to ensure timely and appropriate awards for patients who are

harmed by negligent medical care,

while at the same time protecting

health care providers from unwarranted lawsuits and the need to practice costly defensive medicine.

I supported a medical malpractice

amendment offered by Senator KENNEDY which was based on provisions

contained in comprehensive health

care reform legislation in the last Congress. This approach requires States to

establish alternative dispute resolution

mechanisms so that cases can get an

early hearing, and it limits attorney’s

contingency fees to one-third of the

first $150,000 awarded and 25 percent

thereafter. I regret that this amendment, which would have modified Senator MCCONNELL’s medical malpractice

amendment, was defeated.

I oppose Senator MCCONNELL’s medical malpractice amendment, for both

substantive and procedural reasons. I

was concerned that the amendment did

not allow States to adopt their own

medical malpractice laws if they were

more beneficial to consumers, and I opposed its caps on punitive damages.

I am hopeful that the Senate will return to the important issue of medical

malpractice reform when the Labor

and Human Resources Committee reports the bill it has approved and during debate on health care reform measures.

With the addition of medical malpractice and general civil liability, efforts to pass product liability bill reform were diminished. All of these extraneous items have threatened passage of a good product liability bill and

the White House has also made it clear

that they would veto such Christmas

tree legislation.

In an effort to pare the bill back to

its core principles, I opposed motions

to cut off debate on the bill. I believe

that through this process, the bill now

provides effective product liability reform and its chances of enactment are

improved. I applaud the efforts of Senators ROCKEFELLER and GORTON in the

enormous amount of work undertaken

to pass this legislation.

Mr. ROTH. Mr. President, the Senate’s debate on product liability reform

has revealed that many citizens and

many members of the business community strongly favor legislation that

would alter significant aspects of tort

law. Products liability law traditionally has been a matter of State law,

and the primary venue for products

cases traditionally has been the State

courts, which are our Nation’s courts

of general jurisdiction. Proponents of

the products liability legislation have

asked us, then, to change the laws of

each State by creating Federal standards that would apply in all products

cases, whether they are brought in

Federal or State courts.

I oppose Federal products liability

legislation because it will preempt

whole areas of State law that have

been developed incrementally over

many, many years. The legislation

does not deal with Federal question jurisdiction or any Federal cause of action. Instead, it pertains to an area of

law that has long been the primary responsibility of State courts. If it is to

occur, the reinvention of tort law

should occur through the State courts

and legislatures, which are best situated to determine and control the impact of reform within their own communities.

We are not dealing in an area where

the States have proven incapable of enacting change. The vast majority of

States have already adopted some type

of tort reform, and many States are

considering further changes. These reform measures have varied widely.

Some have involved more dramatic

changes than the Senate has debated;

some have involved more modest
S6400 CONGRESSIONAL RECORD — SENATE May 10, 1995

changes; and some have involved referendums on important Sate constitutional provisions. In my own State of

Delaware, the State legislature has before it several different tort reform

proposals.

The impact of the reforms passed so

far at the State level is unclear, but at

least by one measure, the State reforms appear to be having a positive effect. In a recent survey involving 1993

data, American businesses for the first

time in many years reported that they

spent less on insurance and other riskrelated expenses than they did the year

before. Much of the savings came from

changes enacted by States to their

workers compensation laws, which

have enabled employers to contain

their workers compensation costs in

various ways. The survey reported that

the cost businesses paid for liability

risks, which includes products liability, had leveled out. This is encouraging news.

The patchwork course of tort reform

at the State level has not happened

with the alacrity or the uniformity

that many reform proponents would

like to see. But the State efforts demonstrate why Federal legislation in

this area is so profoundly misguided. In

the best tradition of our Federal form

of Government, the States have balanced, and in many instances are still

considering how to balance, the competing interests in the tort reform debate for their own communities. We

stand poised to upend that State-based

process in favor of legislation that

purports to create uniform Federal

standards. In doing so, we are involving

the Federal Government intimately in

an area where it does not belong.

The Supreme Court’s recent ruling in

United States versus Lopez, the case

which struck down as unconstitutional

the Federal Gun Free School Zones

Act, raises a serious question as to

whether the Federal Government is

permitted to take over the law of products liability.

I oppose the products liability legislation not because of any specific provisions being debated, but because the

federalization of this area of the law is

a bad idea. Federalizing products liability law embarks us, I fear, on a

course where over the years Congress

will succumb to a creeping temptation

to federalize other areas of State law

solely, as in this case, on the grounds

of convenience. I am wary of where

that course leads.

(At the request of Mr. ROCKEFELLER,

the following statement was ordered to

be printed in the RECORD.)

∑ Mr. LIEBERMAN. Mr. President, due

to the death of a close family member,

I am regrettably unable to be present

on the Senate floor today to join my

colleagues in passing product liability

legislation. It is day long awaited by

those of us who have been working on

behalf of reform for years only to be

denied, not only passage of a bill, but

full and open debate. I was proud to be

a cosponsor of past product liability

bills, including this year’s bill, S. 565.

Credit for this remarkable turn of

events is due to Senators ROCKEFELLER

and GORTON, who have labored long and

hard on the Senate floor over the last

2 weeks and, quite literally, for years

to produce a fair bill. It is their perseverance and fair treatment of all that

is responsible for our success today.

Their staffs have done extraordinary

work on their behalf and deserve all of

our thanks—Tamera Stanton, Ellen

Doneski, Lance Bultena, Trent

Erickson, and others.

Were I present today, I would have

voted to table Harkin amendment No.

749, to table Dorgan amendment No. 629

and, of course, I would have enthusiastically voted ‘‘yes’’ for final passage.

Mr. President, I would ask unanimous consent that I be added as a cosponsor of the bill as passed by the

Senate today. This is an important

first step toward comprehensive reform

of our legal system. It is incremental

reform, but it’s significance should be

understated. It establishes some important principles for further reform: parties responsible for harm must be held

fully accountable and parties who have

caused no harm should not be bullied

into settlements by a system that does

more to compensate lawyers than to

achieve justice for injured people.∑

Mr. PRESSLER. Mr. President, as we

conclude the debate over S. 565, the

Product Liability Fairness Act, we

have come full circle.

COMMITTEE ACTION

On March 15 I joined with Senators

GORTON and ROCKEFELLER in introducing legislation designed to reform that

portion of America’s tort system dealing with products liability. Two days of

hearings were conducted on the bill

and on April 6 the Senate Committee

on Commerce, Science, and Transportation, of which I am chairman, met in

executive session to consider the legislation.

During the committee process there

was talk of expanding the bill to encompass a broader array of tort reform.

As chairman, I resisted efforts to expand the legislation into any areas

that did not fall within the jurisdiction

of the Commerce Committee. Do not

get me wrong. I support more broadbased tort reform. My voting record

over the past 2 weeks proves that fact.

However, during committee consideration I believed it was important not

to add provisions that fall under the

province of other Senate committees.

As a result, on April 6 the Commerce

Committee voted 13 to 6 to send a products liability reform bill to the full

Senate.

SENATE CONSIDERATION

On April 24 the full Senate took up

the measure. Over the past 21⁄2 weeks

the legislation has consumed some 90

hours of Senate debate. It has been a

constructive process. No one can say

this body did not fully explore the issues involved. No one can say we

blocked any attempts to make changes

to the legislation. Indeed, it was

those—like myself—who favored a

broader bill that found themselves

blocked.

Since April 24, we have debated and

voted upon over 30 amendments.

Roughly a dozen of those dealt with reforming the medical malpractice system. Senator MCCONNELL introduced a

broad reform amendment similar to

legislation that had been fully debated

by the Committee on Labor and Human

Resources. That major amendment, together with a number of smaller malpractice reform measures passed the

Senate and became part of the bill. I

was proud to support these efforts and

voted for many of the malpractice initiatives.

Next the Senate turned its attention

toward broadening reforms concerning

punitive damages. By considering some

half dozen punitive damages amendments and adopting several—including

major provisions offered by Senators

DOLE and HATCH, by Senator SNOWE

and by Senator DEWINE—a majority of

the Senate worked its will to expand

the reform of punitive damage awards

from product liability cases to include

all civil cases. Again I supported these

efforts and worked for their passage.

Finally, the Senate turned to a consideration of joint and several liability.

S. 565 as reported contained a provision

abolishing joint liability for noneconomic damages. As to these damages, defendants would be liable only in

direct proportion to their responsibility for the claimant’s harm. They

would not be responsible for the harm

caused by another defendant who later

was found unable to pay the compensation awarded. In other words, with regard to noneconomic damages, a defendant’s liability would be several and

not joint. Senator ABRAHAM offered an

amendment on the floor to extend this

concept to all civil cases. Unfortunately, that amendment was tabled.

Mr. President, these actions brought

us to Thursday of last week. They also

put a majority of the Senate on record

in favor of broad-based legal reform.

Most importantly, our efforts produced

a fair, reasonable, and balanced bill.

Sadly, our efforts were not enough.

Last Thursday the Senate failed in two

votes to end debate, allow a vote on

final passage of the bill, and move to a

conference with the House of Representatives to work out the difference

between our bill and the much more

sweeping legislation passed by the

House earlier this year.

As a result, Senate leadership crafted

an alternative bill. That measure, introduced Friday as a substitute to the

pending legislation, returned the reform initiative to its Commerce Committee roots. That proposal, along with

the amendment we are debating today,

is very similar to S. 565 as reported by

the Commerce Committee.

How did this happen? Quite simply

the opponents of broad-based tort reform were highly effective in their
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6401

campaign against the legislation. Like

much of the debate over the issue of

civil justice reform, the rhetoric tended to get very emotional and often

strayed off course.

THE TRUTH ABOUT THE BILL

Mr. President, the truth is this legislation would not change any of what is

right with our current legal system.

The courthouse doors would remain

open. Consumers would still have a full

range of rights. Persons wrongfully injured still would be compensated. Tort

cases could be used to provide a strong

check on corporate behavior. Contingent fees would continue to allow ordinary citizens with limited means the

ability to bring suit. What would

change is that frivolous lawsuits would

be curtailed—pure and simple.

In an earlier statement I outlined

how the bill’s provisions concerning

punitive damages, the statutes of limitations and repose, joint and several liability, defenses for alcohol and drug

abuse, and biomaterial suppliers would

benefit small business, consumers, and

those injured by products. Therefore, I

will not take the Senate’s time to reexamine those issues today. It is not necessary. Under the latest alternative we

have before us today, the things I said

in that statement continue to apply.

I would add only a few comments

concerning the views of the American

people—specifically the citizens of my

home State of South Dakota—with regard to our legal system. A recent poll

conducted in my State found that 83

percent of survey respondents say that

‘‘the present liability system has problems and should be improved,’’ while

only 10 percent say that ‘‘the present

liability lawsuit system is working

well and should not be changed.’’

In addition, this is not a partisan

issue: 78 percent of Democrats, 83 percent of Independents, and 88 percent of

Republicans in South Dakota responding to the survey say there are problems that need to be improved. of those

who had served on a civil trial jury, 79

percent say the system has problems

and needs improvement.

Mr. President, the pending measure

is not as broad as I would like. I truly

wish we could have done more to address the problems of the tort system

generally and not limit ourselves simply to product liability cases. However,

I am gratified the model used by the

Senate for product liability reform

continues to be the bill reported to this

body by the Commerce Committee. It

represents an excellent move forward

and I strongly urge all of my colleagues to vote for this legislation.

Mr. BINGAMAN. Mr. President, I rise

today in opposition to H.R. 956, the

Product Liability Act of 1995.

I have closely followed the debate on

this legislation over the past 2 weeks

and I have come to the conclusion that

despite the efforts of many of this

Chamber, including my good friend

from West Virginia, to craft a balanced

bill, the bill we are voting on today

falls short of that goal.

Mr. President, the issues we have debated over the course of the past 2

weeks are complex and far reaching.

Contrary to what some would have the

American public believe, the solutions

to the problems facing our legal system

cannot be explained away in 30-second

sound bites or by anecdotal evidence.

Each day throughout this country,

judges and juries struggle to determine

what is meant by justice, and, I believe

in the vast majority of cases, these

people, our neighbors, friends, coworkers and family, do a remarkable job of

determining what is fair and what is

just.

I have supported reforms to our legal

system in the past and was prepared to

support a reasonable reform measure

at the end of this debate. I am a cosponsor of S. 240, the Securities Litigation Reform Act of 1995, authored by

my colleagues from New Mexico and

Connecticut. I have supported my own

State’s efforts at reform in the area of

product liability and medical malpractice, and I worked with my colleagues on the Labor and Human Resources Committee last year to fashion

reasonable medical malpractice reform

during the health care reform debate.

Last week, I voted for an amendment

by my colleague from Massachusetts,

Senator KENNEDY, that was a reasonable approach to medical malpractice

reform and would have protected the

rights of States such as New Mexico to

enact their own reform.

Indeed, a proposal that would have

significantly improved this legislation

was considered by Senator BREAUX.

This amendment would have created a

truly uniform statute of repose and addressed the concerns about the elimination of joint and several liability in

a reasoned and balanced matter. The

amendment also would have allowed a

jury to determine whether or not punitive damages are warranted in a particular case and would have allowed

the judge to determine the amount of

punitive damages that should be

awarded. Unfortunately, Senator

BREAUX did not have the opportunity

to offer his amendment and the Senate

did not have the opportunity to debate

it as a result of cloture being invoked

yesterday.

I have come to the conclusion that

the bill that we vote on today tilts the

scales too heavily against protection of

the rights of injured victims and

against just punishment of dangerous

practices. Also, Mr. President, I am

concerned about the provision limiting

the award of punitive damages in cases

filed against a small business. I take a

back seat to no one in my concern for

small businesses and have worked

throughout my career in the Senate to

promote the growth and prosperity of

small businesses especially in my home

State. However, the provision contained in this bill is not well considered; I am afraid that it would lead to

more litigation, not less, and arbitrarily eliminate the opportunity for injured plaintiffs to recover fair and just

compensation for damages inflicted as

a result of conscious and flagrant indifference to their safety. That is what we

are talking about Mr. President, not

simply a mistake, but a conscious and

flagrant indifference to the safety of

consumers.

Mr. President, I would say to my

friend from West Virginia, Senator

ROCKEFELLER, and my friend from

Washington, Senator GORTON, that I

commend them for their efforts during

this debate to bring reason to our deliberations. I know that they have

worked diligently and in good faith to

develop meaningful and balanced legislation in this area. Unfortunately, I do

not believe that the bill before us

reaches those objectives and for that

reason I intend to vote against this bill

and urge my colleagues to join me.

Mr. KERRY. Mr. President, when we

talk about reforming product liability

law, we are talking about taking away

the rights of U.S. citizens. This is serious business—among the most serious

things we can do in the Senate, and it

is from this perspective that we must

approach this debate.

Cloture has been invoked and we are

about to vote on final passage. But before we haphazardly strip citizens of

their rights, we need to take a long,

hard look at what this means to people—how it affects families and children and average, hard-working people

who have suffered.

Let us take a representative case. It

is a wrongful death case.

A woman drives a Pinto to the supermarket. Someone bumps into the rear

of the car, and the car explodes—it explodes. She is tragically burned alive—

a wife, a mother, a human being burned

alive because of what, after years of

legal hassling and thousands of dollars

in legal fees, lawyers hours, and a legal

battle that has become part of tort history, Ford had calculated that it was

cheaper to settle than to protect the

lives of every Pinto owner with a recall.

It made good business sense to take

the risk of people dying.

Mr. President, that kind of business

sense is exactly what I am here to fight

against.

I am here to fight for the husband of

that woman in the Pinto. I ask my colleagues—would you settle for $250,000

in exchange for losing your spouse and

destroying your life?

Is that fair? Is that just?

Mr. President, if this bill were to become law, you would not even get the

$250,000 because there is not a lawyer in

the country who would take the case.

No law firm could afford to go up

against the Ford Motor Co., with its

host of attorneys and huge legal budget, and an infinite ability to push motions and appeals to the limit and slow

down the process to their advantage. It

just would not happen.

Mr. President, I cannot sanction

stripping this legal right from even one

American. I cannot do it. And anyone

who can, should look into the eyes of
S6402 CONGRESSIONAL RECORD — SENATE May 10, 1995

that husband. They should look into

the face of the thousands and thousands of victims across this country

who seek simple justice and fairness

and ask only to be given a chance to

fight the big guys.

It is a matter of fairness. It assures

that those who do not have the resources to fight the richest and most

prominent American corporations

when they are wrong will have a

chance for simple justice.

I am here to fight for average hardworking Americans and to put a face to

this legislation—to talk about how this

bill will affect real Americans. Real

Americans, like the 5-year-old boy in

New Bedford, MA, who died in a house

fire after the flammable material on a

couch ignited, or the 8-month-old baby

who suffered second- and third-degree

burns on his arms, legs, and back in a

house fire that started when the bedding in his crib was ignited by a portable electric heater.

Or, the eight working-class families

in Woburn who sued two of our Nation’s biggest corporations because

they suspected the companies had polluted the East Woburn water supply

with highly toxic industrial solvents,

causing death and injury to their children.

The Woburn case took 9 years, and

the attorney that pleaded the case

spent $1 million of his own money on

it. The jury ultimately found one of

the companies negligent, and the scientific research done during the 9-year

trial demonstrated the link between

the industrial solvents in the water

supply and human disease. The company is now helping to clean up the

polluted aquifer. The attorney has said

that if this bill were law today, he

would never have considered the case.

If we pass the Dole substitute to

H.R. 956, I fear we will be doing great

harm. Our votes will have a serious impact on real Americans.

Mr. President, our laws play a critical role in fostering a competitive economic environment by establishing

groundrules for fair competition and by

helping to reduce the costs of doing

business. But I believe Congress has a

special responsibility to ensure the

laws we write are reasonable and fair;

we must weigh the impact of laws will

have on both consumers and business.

In the 10 years I have considered

product liability reform at the Federal

level, I have heard proponents of reform argue that consumers lose under

the present system. They have argued

that injured consumers receive inadequate compensation, and that injured

consumers wait unreasonable amounts

of time in litigation—on the average of

3 years—before they receive compensation. They have also argued that injured consumers face closed courthouse

doors because the statutes of limitation have expired on their cases.

Proponents of reform have stressed

that companies in the United States

also lose under the current system.

They have pointed to insurance rates

that disable American manufacturers

by forcing them to pay 10 to 50 times

more for product liability insurance

than their foreign competitors. They

have claimed there is an explosion in

products liability litigation, with uncontrollable punitive damages awards.

They have argued that the present system of lottery liability, where liability

differs from State to State, does not

enhance the safety of U.S. products.

Each time the Senate has considered

products liability legislation, I have

measured the legislation against four

tests: Is it fair to injured consumers;

will it help lower insurance rates for

American business; will it help reduce

the number of tort cases and lower the

cost of litigation, the transaction

costs, for American business; and will

it create uniformity in the laws covering products liability or generate more

confusion in the legal system?

In my examination of whether S. 565,

the products Liability Fairness Act,

and the Dole substitute satisfy these

tests, I have concluded that this legislation fails on each account. It does

not address the real concerns of business, nor is it fair to consumers.

IS THE LEGISLATION FAIR TO CONSUMERS?

Consumer products are responsible

for an estimated 29,000 deaths and 30

million injuries each year. But, according to the most authoritative study on

punitive damages, conducted in 1993 by

professors at Boston’s Suffolk University Law School and Northeastern University, there were only 355 awards in

products suits from 1965 to 1990, and

half of these awards were reduced or

overturned. In my own State of Massachusetts, there were absolutely no punitive damages awarded in products

cases.

Contrary to ensuring that injured

consumers will receive adequate compensation in relation to their actual

damages, this legislation imposes a cap

on punitive damages. This is perhaps

the most damaging aspect of this legislation to consumer interests. Although

the cap has been amended to equal the

sum of economic and noneconomic

damages, a cap is still a cap.

In our civil justice system compensatory damages—economic and noneconomic for pain and suffering—compensate victims; in addition, punitive

damages may be awarded by juries to

punish the wrongdoer.

As such, punitive damages are often

the only way individual Americans can

force reckless defendants to change

their conduct. However, despite the effectiveness of punitive damages as deterrents, they are exceedingly rare.

And the new standards imposed for

punitives in this bill will make them

more rare than the Alabama sturgeon.

Under most State laws, the defendant

can be found liable for punitive damages if they engaged in reckless or willful and wanton or grossly negligent

type of behavior.

But under this bill, Mr. President,

such behavior is not enough. A plaintiff

must show that a company engaged in

conduct manifesting a ‘‘conscious, flagrant, indifference to safety’’. I have

no idea what that means, Mr. President. but it certainly appears to be a

tougher standard to meet.

Moreover, it is unclear how the cap

on punitives in this bill would affect

the 39 States that presently either do

not permit punitive damage awards or

have enacted measures that significantly reduce the size and frequency of

such awards.

Far from ensuring injured consumers

will enjoy expeditious resolution of

their case, this legislation could prolong litigation by allowing either party

to request a separate hearing in order

for punitive damages to be awarded.

Far from ensuring courthouse doors remain open to injured consumers, this

bill imposes a 2-year statute of limitation and shortens the statute of repose

by 5 years from last year’s bill.

If this bill truly protects consumers

interests, why is it opposed by every

major consumer group in America?

If this legislation had been in effect,

many cases would simply not have

been possible. Let me give just one

more example here:

In 1988, Playtex removed from the

market its super-absorbent tampons

linked to Toxic Shock Syndrome only

after a $10 million punitive damages

award following the death of a woman

who used the tampons.

The Tenth Circuit Court of Appeals

found ‘‘Playtex deliberately disregarded studies and medical reports

linking high-absorbency tampons fibers with increased risk of toxic shock

at a time when other manufacturers

were responding to this information by

modifying or withdrawing their highabsorbency tampons.’’

Playtex subsequently strengthened

its warnings and began a public awareness campaign about the dangers of

toxic shock. It is doubtful whether a

cap of $250,000 on punitive damages

would have caused Playtex to alter its

behavior.

If the cap on punitive damages contained in this legislation is enacted,

wrongdoers may find it more cost effective to continue their bad behavior

and risk paying punitive damages. I do

not believe we should pass a bill that

reduces the incentive for companies to

produce the safest products.

WILL THIS LEGISLATION LOWER INSURANCE

COSTS FOR BUSINESSES?

In testimony before the Commerce

Committee several years ago, the

American Insurance Association stated:

The bill is likely to have little or no beneficial impact on the frequency or severity of

product liability claims * * * And it is not

likely to reduce claims or improve the insurance market.

So, this legislation will not provide

businesses with cheaper insurance

rates. Insurance premiums for most industries account for less than 1 percent

of a business’ gross receipts. Such a

small percentage hardly threatens the
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6403

viability of business and should not result in increased costs to consumers.

Over the last decade, product liability insurance cost 26 cents per $100 of

retail product sales, which would account for $26 on the price of a $10,000

automobile. Since 1987, according to a

study by the Consumer Federal of

America, product liability insurance

premiums have actually dropped by 47

percent, from $4 billion to $2.7 billion,

a fact that was confirmed by a 1992

Commerce Department study.

Let us take a look at Florida. In

Florida’s 1986 tort reform law, the

State eliminated joint and several liability, limited noneconomic damages

to $450,000, limited punitive damages,

and required the insurance industry to

make rate filings indicating the effect

of the changes in its tort laws on product liability insurance rates.

Yet, Aetna’s subsequent rate filing

listed the effect of each change on its

rates as zero. If such dramatic changes

in Florida’s tort reform law resulted in

no lowering of liability insurance costs

for a major carrier like Aetna, where is

the evidence to suggest this bill will

produce different results?

WILL THE LEGISLATION LOWER THE COST OF

PRODUCTS LIABILITY LITIGATION FOR BUSINESSES?

Proponents of this legislation speak

in terms of an explosion in product liability litigation. However, the evidence belies this characterization. In

fact, the number of nonasbestos products liability suits in Federal courts

has declined almost 40 percent since

1985. In State courts, where most products liability claims are filed, lawsuits

have remained constant since 1990, according to testimony presented to the

committee on April 3, by the National

Center for State Courts.

The 1992 annual report of the National Center for State Courts found

that tort cases are approximately 9

percent of the 10 million civil filings in

State courts and products cases are 4

percent of these—40,000.

Only one-third of 1 percent of all tort

filings in State courts are product filings.

Of all tort filings in 1991, 58 percent

were related to automobile liability; 33

percent were miscellaneous; 5 percent

were malpractice; and 4 percent were

products. Since 1990, the national total

of State tort filings has fallen by 2 percent.

In 1990, the Rand Corp. found that

most injured Americans never file a

lawsuit for their injuries: only 10 percent of injury victims ever use the tort

system to seek compensation for their

injuries.

This report also found that only 7

percent of all compensation for accident victims is paid through the tort

system. The report observed:

Americans’ behavior does not accord with

the more extreme characterizations of litigiousness that have been put forward by

some.

If there has been a litigation explosion, it is not in the area of products liability. Once again, this legislation

misses the target in addressing the real

litigation problems facing business.

WILL THIS LEGISLATION BRING UNIFORMITY TO

PRODUCT LIABILITY LAW?

Tort law has traditionally been a

State responsibility, and the imposition of Federal products standards

upon State tort law would, according

to the National Conference of State

Legislatures, ‘‘create confusion in

State courts.’’

Testimony by the Conference of Chief

Justices was even more emphatic:

If the primary goal of this legislation is to

provide consistency and uniformity in tort

litigation, we are concerned that its effect

will be the opposite.

Preempting each State’s existing tort law

in favor of a broad Federal product liability

law will create additional complexities and

unpredictability for tort litigation in both

State and Federal courts, while depriving

victims of defective products of carefully

reasoned principles and procedures already

developed at the State level.

This bill will not end the search of

the sponsors for a single settled law because it does not create Federal question jurisdiction. The legislation would

preempt all related State law and substitute Federal standards, but it would

impose the Federal standards in a single overlay upon the 56 existing State

court systems as well as the Federal

courts.

The result will be both State and

Federal courts applying a mix of State

and Federal law in the same case;

State supreme courts will no longer be

the final arbiters of their tort law. The

U.S. Supreme Court, which many experts argue is already overburdened,

will become the final arbiter of this

new legal thicket.

So, here we have what is indeed an

irony: Those who ordinarily preach the

virtue of reserving power to the States

are instead advancing legislation to

usurp the legitimate authority of

States.

At a time when many in Congress are

intent upon returning responsibility

for many Federal programs to the

States, this legislation would preempt

State law.

Mr. President, the sponsors of this

legislation have worked extremely

hard, and I particularly wish to commend my friend from West Virginia for

his tireless efforts on behalf of this legislation. I also commend the ranking

Democrat on the Commerce Committee, Senator HOLLINGS, for his stalwart

defense of consumer interests.

For all of this effort, I regret that I

cannot support this bill. I cannot support it for two very simple reasons.

The legislation is patently unfair to

consumers, and it will not resolve the

products liability problems businesses

tell me they face.

It will remove from ordinary Americans the power they retain in the jury

box to force accountability for dangerous, careless, or reckless behavior.

In the jury box, each American can

bring about positive change. If we undermine the ability of our citizens to

force changes in bad behavior, we will

have compromised our Nation’s core

values.

While many Americans increasingly

sense an erosion of personal responsibility, our civil justice system remains one institution that holds individuals and organizations accountable

for their behavior. Make no mistake,

by restricting the civil justice system,

this bill will take rights away from

Americans.

All of the available evidence on this

legislation shows it will not make businesses more competitive by reducing

insurance rates or the costs of corporate litigation, and it will not create

national uniformity in products liability law.

A great deal of hype has been generated about this issue, and after 15

years, it appears to have taken on a

life of its own. But all the lobbying and

advertising cannot convince me that

this legislation will accomplish its

stated goals.

The Dole substitute to H.R. 956 fails

to strike a reasonable balance between

promoting the competitive interests of

business and protecting the rights of

consumers. It will create a nightmarish

new legal thicket that should be avoided rather than embraced. It is unfortunate that after all the effort we could

not have achieved a reasonable balance.

After we have argued all the complicated points of law, after we have

poured over horror story after horror

story, the issues boil down to one simple point: This bill is not fair, and it

should be rejected.

I yield the floor.

Mr. GORTON. Mr. President, I ask

unanimous consent that a letter I received from the National Federation of

State High School Associations be

printed in the RECORD.

There being no objection, the letter

was ordered to be printed in the

RECORD, as follows:

NATIONAL FEDERATION OF STATE

HIGH SCHOOL ASSOCIATIONS,

Kansas City, MO, May 9, 1995.

Hon. SLADE GORTON,

U.S. Senate, Washington, DC.

DEAR SENATOR GORTON: On behalf of the

National Federation of State High School

Associations, I want to commend you for

your leadership on legislation to address the

long overdue reform of our civil justice system. We applaud your efforts to rein in the

exploding costs of litigation that, if unchecked, threaten to bankrupt non-profit organizations such as ours and our member affiliates. The National Federation is comprised of 51 state high school associations,

with the primary purpose of promulgating

sports and non-sports playing rules, including those specific to safety issues, for more

than 20,000 schools and approximately

10,000,000 students each year. Additionally,

our member associations establish and enforce the eligibility rules under which all

boys and girls compete in high school athletics.

The legislation pending before the United

States Senate, The Product Liability Fairness Act of 1995 (H.R. 956), sets limits on all

product liability cases. Furthermore, the bill

as currently amended, would eliminate joint
S6404 CONGRESSIONAL RECORD — SENATE May 10, 1995

liability for non-economic damages. Instead,

only several liability would be allowed which

means that each defendant would be liable

only for his, her, or its portion by reason of

its proportion of the fault causing the injury. Economic damages, i.e. lost wages,

medical costs, etc. would remain joint and

several at the discretion of each state.

We strongly agree with your comment on

the floor this past week stating ‘‘it is unfair

and unproductive to make defendants pay for

damages of a nature that are literally beyond their control or beyond their fault.’’

This fundamental concept should apply to

the civil justice system as well.

Let me cite two examples of costly litigation we recently incurred which epitomize

the unfairness and counterproductive nature

of current civil law. Both occurred in school

swimming pools.

First, in Indiana a high school boy was

‘‘leap frogging’’ off the starting platform,

prior to the start of practice, despite repeated warnings from his coach. On one such

leap, his foot got caught under the platform;

he fell head first into the water and struck

his head on the pool bottom. Tragically, he

suffered a neck injury that ultimately resulted in quadriplegla. While this unimaginably horrible accident was not related to

any swimming competition, the National

Federation was sued simply because it writes

the rules for interscholastic swimming, including rules related to standards for equipment and facilities such as the depth of

swimming pools.

Yet another incident occurred in Michigan

during a water polo practice. This incident

involved a high school boy who jumped off

the platform over a lane designation rope

and struck his head on the pool bottom. This

seemingly harmless leap resulted in a lifetime of paralysis from the neck down. While

the National Federation does not even write

water polo rules, nor rules for the practice

sessions for any sport, we were included in

the law suit and incurred exorbitant legal

fees for a defense that should not have been

necessary.

These are but two examples of what has become a nightmare of litigation for the National Federation and its member affiliates.

Without radical reforms to our system of

civil justice, organizations such as ours

whose sole mission is to build a consensus

for safe sports competition will be unfairly

jeopardized and possibly destroyed.

Unfortunately, lawyers often join sanctioning bodies such as ours in law suits as a

trial strategy rather than because of a reasonable belief that the injury was caused in

any way by the action of the sanctioning

body. Current law discourages sanctioning

bodies from setting minimum safety standards because of their fear of being joined in

subsequent litigation. This is bad public policy.

Therefore, in addition to holding firm in

your effort to reform the civil justice system, we urge you to include an exemption in

the law for sanctioning bodies such as ours

who are joined in law suits solely because

they recommend minimum standards for facilities and equipment for the purpose of reducing risk inherent in participation in almost any given sport. This exemption would

be consistent with your stated belief that it

is unfair and unproductive to make defendants liable for incidents that are ‘‘literally

beyond their control or beyond their fault.’’

Again, thank you for your leadership on

this vital issue. The members of the National

Federation of State High School Associations and I look forward to assisting you in

achieving these needed reforms.

Sincerely,

ROBERT F. KANABY,

Executive Director.

Mr. BYRD. Mr. President, the Senate

has been considering legislation related to product liability for almost 2

weeks. During that time I have heard

from a number of West Virginians who

have been harmed or injured by defective products, as well as from businesses that have been seriously impacted by lawsuits brought against

them—at times somewhat unfairly. I

have listened to the debate and considered how the Senate can best balance

these competing interests, and have

concluded that the substitute amendment offered by Senators GORTON and

ROCKEFELLER does not adequately protect the rights of injured parties and

consumers in two critical areas.

The first involves the issue of several

or proportional liability, versus joint

and several liability. Under the concept

of proportional liability, a defendant is

only responsible for a percentage of liability directly contributing to the injury or harm caused by the defective

product. On the other hand, joint and

several liability provides that each defendant who contributes to causing a

plaintiff’s injury may be held liable for

the total amount of damages. Joint

and several liability, by enabling a

plaintiff to recover all of his or her

damages from a single defendant with

the greatest financial assets or resources—the so-called ‘‘deep pocket’’—

makes it more likely that the plaintiff

will obtain full recovery in the event

that one defendant does not have the

assets to pay part of the judgment.

The proposed legislation completely

eliminates joint and several liability

for noneconomic damages, such as pain

and suffering, while retaining it for

economic damages. This means that

victims would fully recover their economic damages in the form of lost income or medical expenses, but victims

with higher lost incomes, such as business executives, would receive greater

compensation. Victims would fully recover their economic damages, even if

only one defendant among several defendants is still solvent, because the

‘‘deep pocket’’ would provide full compensation for economic damages; however, due to the elimination of joint

and several liability for noneconomic

damages the parties would only receive

partial compensation for pain and suffering.

This provision could significantly reduce compensation in cases where the

individual could still earn a livelihood,

and thus not have large economic damages, yet that same individual could

still have significant noneconomic

damages. In this context, noneconomic

damages could include not just pain

and suffering, but also any diminishment of the quality of life, such as infertility or the loss of a limb.

The result of completely eliminating

joint and several liability for noneconomic damages, then, would be that

the innocent victim might not receive

a majority of the compensation due if

the other wrongful defendants were insolvent. I have concluded that this provision in the legislation shifts the balance too far in the direction of defendants at the expense of the victims of

wrong doing in the form of defective

products.

The other key provision of the legislation is the section dealing with punitive damages. Punitive damages are intended to punish willful or wanton misconduct on the part of a manufacturer

or business. Furthermore, by punishing

misconduct, punitive damages are intended to deter such behavior in the future.

Punitive damages therefore must

take into consideration the financial

assets of the defendant or guilty party.

A punitive damage judgment of $250,000

may be both harsh punishment and a

significant deterrent to a small business, but it is insignificant to a large

corporation. Any cap on punitive damages can only serve to benefit, if not

condone, egregious and wanton behavior by large corporations.

The legislation limits punitive damages to the greater of $250,000 or two

times the total economic and noneconomic damages. The bill also stipulates that a judge may add to these punitive damages, and exceed the cap, at

his discretion. I am concerned that this

‘‘judge additur’’ provision does not

fully resolve the problem of capping

punitive damages for large corporations. First, many judges may be reluctant to overrule a jury’s decision, and

add to the punitive judgment. Second,

the effect could be arbitrary, as some

judges may opt to add to punitive judgments, while others may not. Third,

the burden of proof would be on judges

to demonstrate why a larger punitive

judgment that would exceed the cap is

necessary, which could discourage

judges from adding to punitive judgments. Fourth, it strikes at the heart

of our tradition of jury judgments in

such product liability and civil litigation.

I recognize that the current product

liability system, which involves different laws in each of the 50 States, imposes a considerable hardship on some

manufacturers, particularly in the case

of small business. I endorse the goal of

establishing some type of national uniformity in this area. However, I regret

that I cannot support the legislation

that is now before the Senate. While

national uniformity is a laudable goal,

any national standard must also fully

protect the rights of consumers and

victims of harm caused by defective

products.

While I may disagree on several of

the provisions included in this measure, I would be remiss if I did not acknowledge and salute the hard work

and leadership of Senator ROCKEFELLER. He believes in this legislation.

He has put his heart into working on

it, and I believe that he is correct in

that there are inequities in the present

system which need to be addressed. My

opposition notwithstanding, I want to

commend both Senator ROCKEFELLER

and Senator GORTON for their tireless
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6405

efforts on behalf of product liability reform.

Mr. LEVIN. Mr. President, I believe

that there is a strong argument to be

made for uniformity in product liability law since so many products are sold

across State lines.

But there is no uniformity in this

bill. This bill contains limits and restrictions on compensation for injuries

caused by defective products, but those

limits and restrictions are not uniform.

On the contrary, the bill contains a

one-way preemption provision, which

allows States to adopt virtually any

law that differs from the so-called national standard, as long as that law is

more restrictive than that standard. A

patchwork of State laws is still permitted, provided that the divergences

are in the direction of greater restrictions on the injured party.

As I pointed out earlier in this debate, every single provision of this bill

is written to prohibit State laws that

are more favorable to plaintiffs. But

the only provision of the bill that

would prohibit State laws that are

more favorable to defendants is the

statute of limitations. We are not

adopting true national standards at all.

This bill is not balanced, it is not

uniform, and I cannot support it.

I ask unanimous consent that a table

demonstrating the one-way nature of

the preemption in this bill be printed

in the RECORD.

There being no objection, the table

was ordered to be printed in the

RECORD, as follows:

PREEMPTION OF STATE PRODUCT LIABILITY LAWS UNDER

S. 565, AS REPORTED

State laws

more favorable to plaintiffs

State laws

more favorable to defendants

Liability of product sellers .......................... Prohibited ..... Allowed. Alcohol or drug abuse defense ................... ......do ........... Do. Misuse or alteration of product defense .... ......do ........... Do. Punitive damage limitations ....................... ......do ........... Do. Statute of limitations .................................. ......do ........... Prohibited. Statute of repose ........................................ ......do ........... Allowed. Joint and several liability (non-economic

damages).

......do ........... Do.

Biomaterials provisions ............................... ......do ........... Do.

Ms. MIKULSKI. Mr. President, I

voted for cloture on the product liability bill because I believe it is important to the economy, job creation,

international investment, and our ability to do research, especially on issues

of women’s health.

Mr. President, much has been said

about caps. I do not like caps—caps on

job creation or caps on innovative research. I do not like caps on technological advancement or caps on our

ability to go global. I am opposed to

caps on profits, caps on wages, or caps

on opportunity.

My job as a U.S. Senator is to save

jobs, save lives and save communities.

I support efforts to reduce frivolous

law suits and improve the efficiency of

our legal system.

I have heard of cost estimates for

cases that are in the millions. That’s

outrageous. We should make every effort to establish consistency and uniformity, but not at the price of people’s

fundamental right to redress.

When it comes to public health and

safety I want to ensure that those responsible are in fact held accountable

for their actions. For that reason, I

will not support any legislation which

closes the courthouse door to citizens

with legitimate cases.

This is the kind of balance I support

and that I believe we, as Members of

Congress, need to achieve with this legislation.

Mr. President, today’s cloture vote

was a difficult decision for me. Product

liability involves very complex and

complicated issues, including joint and

several liability, noneconomic versus

economic damages, statute of repose,

punitive damages, and alternate dispute resolution. To help me better understand product liability and its impact on people’s day to day lives, I met

with people on both sides of this issue.

I met with business organizations and

consumer organizations. All the groups

made legitimate arguments expressing

worthwhile and important concerns.

Some businesses are concerned about

how our current system ultimately impacts their decisions about innovation

and competitiveness, small businesses

are concerned about going out of business all together. We should take every

step we can to cut unnecessary liability costs and encourage innovation. Innovation will ultimately lead to jobs

today and jobs tomorrow. We must acknowledge that innovation, particularly in the health field, is critical for

out Nation’s economic stability and

competitiveness, and it is critical to

the health and safety of American citizens.

I was particularly moved by the National Family Planning and Reproductive Health Association’s position that

tort reform is needed to increase investment in women’s health research

and technologies. Mr. President, the

product liability issue has been around

for quite some time. There was no

doubt that I could not sign on to previous product liability reform bills introduced in the early 1980’s. But, I believe the current legislation is an attempt to achieve a reasonable balance

at this point.

Is this bill perfect? Of course, it is

not. In this case, it is hard to put forth

a perfect bill. There is no doubt that

we should review this issue in the coming years and make sure it is working.

If it is not working, we in Congress

have the option to review it and make

changes. Looking at our current system, I believe there are areas that can

be improved. For that reason, I am

willing to support Federal product liability reform. Many of the reforms

proposed by this legislation have already been done at the State level. So,

in many ways we are acting consistently with respect to the States.

Mr. President, I want to make it

clear. The House bill goes too far. It includes a number of bad provisions, including severe caps on pain and suffering. To move beyond the Senate bill

would be a mistake. The scales on this

issue are delicately balanced. If those

scales are tipped, it is unlikely I will

support this bill.

Mr. PELL. Mr. President, today the

Senate has passed by a convincing margin the product liability bill. It was a

difficult and contentious effort, much

akin to the debate that this area has

generated over the last decade. I was

pleased that the Senate saw fit to pass

this legislation and am hopeful that a

productive and successful conference

with the House will follow and eventually that the President will sign this

legislation into law.

I have long supported product liability reform even when it began as a

somewhat lonely effort over a decade

ago. Finally, with a supportive Congress, it seems that we may be coming

up with a bill that can actually become

the law of the land. It must be noted

that in order to preserve the best possible chance of reaching that result,

other areas of legal reform, such as

medical malpractice and broad tort reform, have been excluded. I joined in

the effort to keep this bill clean from

those additions but I want to state that

I support reform in those areas as well

and look forward to addressing them in

the future. I simply felt that this legislation was an inappropriate forum for

dealing with those issues. In the end,

this bill represents a workable and reasonable balance for reforming the legal

procedures and standards governing

how one can seek redress for harm

caused by faulty products.

I congratulate the hard work of my

colleagues, in particular Senators

ROCKEFELLER and GORTON, who artfully

and doggedly crafted a compromise

that was acceptable to the Senate.

They have worked hard and long, indeed for years, on this legislation and

they are to be commended for their accomplishment. I await the conference

report on this legislation with anticipation and express my hope for speedy

final consideration.

Mr. BRADLEY. Mr. President, I rise

in opposition to the Product Liability

Fairness Act of 1995. Let me first say,

Mr. President, that I share the concerns of the people of New Jersey and

this country that our society is too litigious. I share the concerns of my colleagues and the American people that

the cost of this litigation explosion is

injurious to the social and economic

future of this country. However, after

reviewing this bill and assessing the arguments, both pro and con, I do not

think that this bill strikes the appropriate balance between the desires of

manufacturers and product sellers to

streamline the product liability process and the ability of ordinary Americans to bring lawsuits seeking relief

from injuries resulting from defective

and dangerous products.

Mr. President, I favor a cap on punitive damages for small businesses. I

supported the amendment of my colleague from Ohio, Senator DEWINE,
S6406 CONGRESSIONAL RECORD — SENATE May 10, 1995

which provides for a cap on punitive

damages for small businesses with 25 or

fewer employees and individuals with

assets of less than $500,000. Small businesses are the engine that drives the

American economy and provide for at

least half of this country’s new employment opportunities. While a cap on

punitive damage awards should be sufficient to punish and deter future action, it should also reflect the fact that

a cap that may be sufficient to punish

a large corporation may in fact push a

small business into the abyss of bankruptcy.

However, Mr. President, I have grave

concerns about the overall cap on punitive damages. The purpose of punitive

awards is to punish the wrongdoer for

egregious behavior and deter such behavior in the future. I believe that if

we place a low cap on punitive damages, some corporations will not be discouraged from exposing consumers to

dangerous products. Indeed, with predictable caps, Mr. President, wrongdoers may find it more cost effective to

make dangerous decisions and risk

paying punitive damages. Moreover,

Mr. President, while this bill authorizes judges to increase an award of punitive damages beyond the limits of

the cap, this safeguard is illusory because defendants have the right to receive a new trial—a right which they

will surely exercise. Indeed, the provision in the bill will only lead to repetitive litigation, increase costs and prevent deserving consumers from obtaining their awards in a timely manner.

Mr. President, I do not need to repeat

the horror stories about women who

have tragically suffered and died from

using dangerous products, children who

have been burned by flammable clothing, or hard working Americans, who

have senselessly been injured and

killed as a result of defective automobiles. What needs to be repeated is

that the one constant in all of these

horror stories is that the manufacturer

knew of the dangerous defect and failed

to take adequate steps to protect the

public. Mr. President, punitive damages are available to police conduct

that is so egregious that the offender

disregarded forseeable dangerous consequences. Indeed, as this bill provides,

punitive damages are only available

where there is clear and convincing

evidence of a conscious, flagrant indifference to the safety of others. Given

the nature of the offense, Mr. President, I firmly believe that placing a

cap on punitive damages will be counterproductive to society’s efforts to police and deter such egregious conduct.

Mr. President, under the present

caps, cigarette manufacturers and

those who irresponsibly market alcohol

to intoxicated persons or minors who

then kill or injure innocent victims in

traffic crashes would continue to manufacture and market these products of

destruction with less fear of having to

one day pay the price for the massive

damage that their products inflict on

society. Moreover, firearms and ammunition are virtually the only unregulated consumer product in America. As

such, the tort system is the only check

on the safety of consumers. I am not

willing, Mr. President, to place a cap

on punitive damages when the result

will be that such action will lessen the

liability of the manufacturers who

profit from these destructive products.

Mr. President, while I also think that

there is a need for joint and several liability reform, I cannot endorse the

blanket elimination of joint and several liability for noneconomic damages

that is in the present bill. Instead, Mr.

President, I favor the approach currently in operation in New Jersey,

which provides for proportional liability if the defendant is responsible for 20

percent or less of the harm, several liability for noneconomic damages if a

defendant is responsible for between 20

percent and 60 percent of the harm, and

joint and several liability if the defendant is responsible for 60 percent or

more of the harm.

Mr. President, this bill would preempt State product liability law ‘‘to

the extent that state law applies to an

issue covered under the Act.’’ Proponents of product liability reform

argue that Federal legislation is needed to establish uniformity. However,

the bill does not require States to have

uniform State laws. For example, those

States that do not now allow punitive

damages would not be required to

award them, even though the bill provides for the award of such damages.

The effect of this provision is that

States can offer their individual citizens fewer rights, but not more.

Mr. President, this bill also excludes

actions involving commercial loss. By

excluding such actions, the bill places

restrictions on the ability of individuals to seek redress from defective

products, but does not place any restrictions on corporations to seek redress. For example, if a product explodes in a factory, the worker’s recovery for injuries is limited by this bill;

however, the factory owner may sue

the product manufacturer or seller free

from the restrictions of the bill for

such speculative damages as the factory’s loss of profits because of delays

in production. Thus, the effect of this

provision is to value material property

over the health and safety of individual

citizens.

Mr. President, we have been told that

there is a litigation explosion with respect to product liability and that corporations and the business community

are suffering under the weight of this

explosion. However, Mr. President, excluding cases of asbestos, product liability claims in Federal courts have

declined by approximately 36 percent

between 1985 and 1991. Moreover, in

State courts, product liability cases

are approximately 4 percent of all tort

filings, .0036 percent of all civil caseloads and .00097 percent of the total

State court caseloads.

Mr. President, although there have

been relatively few punitive damage

awards in product liability cases over

the last 25 years, we have been told

that the threat of punitive damages encourages many product manufacturers

to settle cases that they would have no

problem winning in an effort to avoid

having claims for punitive damages go

to juries unfamiliar with the precautions that are now taken to insure

that products are safe. However, Mr.

President, the numbers simply do not

add up to the conclusion that the business community is being treated unfairly by juries. Indeed, almost 60 percent of the product liability cases

brought in 1993, plaintiffs were the losing parties.

Mr. President, it has additionally

been argued that these lawsuits increase the costs of producing products

in this country and thus hurt American

competitiveness. However, a 1987 Conference Board survey of risk managers

of 232 corporations shows that product

liability costs for most businesses are 1

percent or less of the final price of a

product, and have very little impact on

larger economic issues such as market

share or jobs. In addition, the American Insurance Association, the largest

trade association representing the insurance industry, has testified that

this legislation will have virtually no

effect on insurance costs.

Mr. President, to put it succinctly, I

do not think that the bill will really do

what its proponents say it will do. As

mentioned earlier, the proponents of

this bill argue that the business community is suffering under the weight of

a litigation explosion. They contend

that this bill will decrease both the incidence and cost of litigation. Mr.

President, no one disagrees that we are

an overly litigious society. However, I

am not convinced that this bill can

correct the problem of litigiousness in

society. Indeed, Mr. President, the fact

is that the punitive caps provision providing for the automatic right to a new

trial by defendants will serve to only

increase the delay and cost of litigation. This bill tilts the scales of justice

too far to the disadvantage of individual consumers. Thus, I cannot support

legislation which will endanger the

health and safety of hard working

Americans.

In conclusion, Mr. President, because

of the above stated concerns, I must

oppose the Product Liability Fairness

Act of 1995.

VOTE ON AMENDMENT NO. 690, AS AMENDED

The PRESIDING OFFICER. The

question is on agreeing to the amendment numbered 690, the Coverdell-Dole

substitute, as amended.

So the amendment (No. 690), as

amended, was agreed to.

VOTE ON AMENDMENT NO. 596, AS AMENDED

The PRESIDING OFFICER. The

question is on agreeing to the amendment numbered 596, the Gorton substitute, as amended.

So the amendment (No. 596), as

amended, was agreed to.

The PRESIDING OFFICER. The

question is on the engrossment of the
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6407

amendments and third reading of the

bill.

The amendments were ordered to be

engrossed, and the bill to be read a

third time.

The bill was read a third time.

Mr. GORTON. Mr. President, I ask

for the yeas and nays.

The PRESIDING OFFICER. Is there a

sufficient second?

There is a sufficient second.

The yeas and nays were ordered.

The PRESIDING OFFICER. The bill

having been read the third time, the

question is, Shall the bill pass?

The clerk will call the roll.

The legislative clerk called the roll.

Mr. LOTT. I announce that the Senator from Virginia [Mr. WARNER] is

necessarily absent.

Mr. FORD. I announce that the Senator from Connecticut [Mr. LIEBERMAN]

is absent because of death in the family.

I further announce that, if present

and voting, the Senator from Connecticut [Mr. LIEBERMAN] would vote ‘‘yea.’’

The PRESIDING OFFICER. Are there

any other Senators in the Chamber desiring to vote?

The result was announced—yeas 61,

nays 37, as follows:

[Rollcall Vote No. 161 Leg.]

YEAS—61

Abraham

Ashcroft

Bennett

Bond

Brown

Burns

Campbell

Chafee

Coats

Cochran

Conrad

Coverdell

Craig

DeWine

Dodd

Dole

Domenici

Dorgan

Exon

Faircloth

Feinstein

Frist

Glenn

Gorton

Gramm

Grams

Grassley

Gregg

Hatch

Hatfield

Helms

Hutchison

Inhofe

Jeffords

Johnston

Kassebaum

Kempthorne

Kohl

Kyl

Lott

Lugar

Mack

McCain

McConnell

Mikulski

Moseley-Braun

Murkowski

Nickles

Nunn

Pell

Pressler

Pryor

Robb

Rockefeller

Santorum

Smith

Snowe

Stevens

Thomas

Thompson

Thurmond

NAYS—37

Akaka

Baucus

Biden

Bingaman

Boxer

Bradley

Breaux

Bryan

Bumpers

Byrd

Cohen

D’Amato

Daschle

Feingold

Ford

Graham

Harkin

Heflin

Hollings

Inouye

Kennedy

Kerrey

Kerry

Lautenberg

Leahy

Levin

Moynihan

Murray

Packwood

Reid

Roth

Sarbanes

Shelby

Simon

Simpson

Specter

Wellstone

NOT VOTING—2

Lieberman Warner

So the bill (H.R. 956), as amended,

was passed, as follows:

Resolved, That the bill from the House of

Representatives (H.R. 956) entitled ‘‘An Act

to establish legal standards and procedures

for product liability litigation, and for other

purposes’’, do pass with the following amendment:

Strike out all after the enacting clause and

insert:

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Product Liability Fairness Act of 1995’’.

TITLE I—PRODUCT LIABILITY

SEC. 101. DEFINITIONS.

For purposes of this Act, the following

definitions shall apply:

(1) ACTUAL MALICE.—The term ‘‘actual malice’’ means specific intent to cause serious

physical injury, illness, disease, or damage

to property, or death.

(2) CLAIMANT.—The term ‘‘claimant’’

means any person who brings a product liability action and any person on whose behalf such an action is brought. If an action is

brought through or on behalf of—

(A) an estate, the term includes the decedent; or

(B) a minor or incompetent, the term includes the legal guardian of the minor or incompetent.

(3) CLAIMANT’S BENEFITS.—The term

‘‘claimant’s benefits’’ means the amount

paid to an employee as workers’ compensation benefits.

(4) CLEAR AND CONVINCING EVIDENCE.—

(A) IN GENERAL.—Subject to subparagraph

(A), the term ‘‘clear and convincing evidence’’ is that measure of 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.

(B) DEGREE OF PROOF.—The degree of proof

required to satisfy the standard of clear and

convincing evidence shall be—

(i) greater than the degree of proof required to meet the standard of preponderance of the evidence; and

(ii) less than the degree of proof required

to meet the standard of proof beyond a reasonable doubt.

(5) COMMERCIAL LOSS.—The term ‘‘commercial loss’’ means any loss or damage to a

product itself, loss relating to a dispute over

its value, or consequential economic loss the

recovery of which is governed by the Uniform Commercial Code or analogous State

commercial law, not including harm.

(6) DURABLE GOOD.—The term ‘‘durable

good’’ means any product, or any component

of any such product, which has a normal life

expectancy of 3 or more years or is of a character subject to allowance for depreciation

under the Internal Revenue Code of 1986, and

which is—

(A) used in a trade or business;

(B) held for the production of income; or

(C) sold or donated to a governmental or

private entity for the production of goods,

training, demonstration, or any other similar purpose.

(7) ECONOMIC LOSS.—The term ‘‘economic

loss’’ means any pecuniary loss resulting

from harm (including any medical expense

loss, work loss, replacement services loss,

loss due to death, burial costs, and loss of

business or employment opportunities), to

the extent that recovery for the loss is permitted under applicable State law.

(8) HARM.—The term ‘‘harm’’ means any

physical injury, illness, disease, or death, or

damage to property, caused by a product.

The term does not include commercial loss

or loss or damage to a product itself.

(9) INSURER.—The term ‘‘insurer’’ means

the employer of a claimant, if the employer

is self-insured, or the workers’ compensation

insurer of an employer.

(10) MANUFACTURER.—The term ‘‘manufacturer’’ means—

(A) any person who is engaged in a business to produce, create, make, or construct

any product (or component part of a product), and who designs or formulates the product (or component part of the product), or

has engaged another person to design or formulate the product (or component part of

the product);

(B) a product seller, but only with respect

to those aspects of a product (or component

part of a product) which are created or affected when, before placing the product in

the stream of commerce, the product seller

produces, creates, makes, constructs, designs, or formulates, or has engaged another

person to design or formulate, an aspect of a

product (or component part of a product)

made by another person; or

(C) any product seller that is not described

in subparagraph (B) that holds itself out as a

manufacturer to the user of the product.

(11) NONECONOMIC LOSS.—The term ‘‘noneconomic loss’’—

(A) 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; and

(B) does not include economic loss.

(12) PERSON.—The term ‘‘person’’ means

any individual, corporation, company, association, firm, partnership, society, joint

stock company, or any other entity (including any governmental entity).

(13) PRODUCT.—

(A) IN GENERAL.—The term ‘‘product’’

means any object, substance, mixture, or

raw material in a gaseous, liquid, or solid

state that—

(i) is capable of delivery itself or as an assembled whole, in a mixed or combined

state, or as a component part or ingredient;

(ii) is produced for introduction into trade

or commerce;

(iii) has intrinsic economic value; and

(iv) is intended for sale or lease to persons

for commercial or personal use.

(B) EXCLUSION.—The term ‘‘product’’ does

not include—

(i) tissue, organs, blood, and blood products

used for therapeutic or medical purposes, except to the extent that such tissue, organs,

blood, and blood products (or the provision

thereof) are subject, under applicable State

law, to a standard of liability other than

negligence; and

(ii) electricity, water delivered by a utility, natural gas, or steam.

(14) PRODUCT LIABILITY ACTION.—The term

‘‘product liability action’’ means a civil action brought on any theory for harm caused

by a product.

(15) PRODUCT SELLER.—

(A) IN GENERAL.—The term ‘‘product seller’’ means a person who—

(i) in the course of a business conducted for

that purpose, sells, distributes, rents, leases,

prepares, blends, packages, labels, or otherwise is involved in placing a product in the

stream of commerce; or

(ii) installs, repairs, refurbishes, reconditions, or maintains the harm-causing aspect

of the product.

(B) EXCLUSION.—The term ‘‘product seller’’

does not include—

(i) a seller or lessor of real property;

(ii) a provider of professional services in

any case in which the sale or use of a product is incidental to the transaction and the

essence of the transaction is the furnishing

of judgment, skill, or services; or

(iii) any person who—

(I) acts in only a financial capacity with

respect to the sale of a product; or

(II) leases a product under a lease arrangement in which the lessor does not initially

select the leased product and does not during

the lease term ordinarily control the daily

operations and maintenance of the product.

(16) STATE.—The term ‘‘State’’ means each

of the several States of the United States,

the District of Columbia, the Commonwealth

of Puerto Rico, the Virgin Islands, Guam,

American Samoa, and the Commonwealth of

the Northern Mariana Islands, and any other

territory or possession of the United States,

or any political subdivision thereof.
S6408 CONGRESSIONAL RECORD — SENATE May 10, 1995

(17) TIME OF DELIVERY.—The term ‘‘time of

delivery’’ means the time when a product is

delivered to the first purchaser or lessee of

the product that was not involved in manufacturing or selling the product, or using the

product as a component part of another

product to be sold.

SEC. 102. APPLICABILITY; PREEMPTION.

(a) APPLICABILITY.—

(1) ACTIONS COVERED.—Subject to paragraph (2), this title applies to any product liability action commenced on or after the

date of enactment of this Act, without regard to whether the harm that is the subject

of the action or the conduct that caused the

harm occurred before such date of enactment.

(2) ACTIONS EXCLUDED.—

(A) ACTIONS FOR DAMAGE TO PRODUCT OR

COMMERCIAL LOSS.—A civil action brought for

loss or damage to a product itself or for commercial loss, shall not be subject to the provisions of this title governing product liability actions, but shall be subject to any applicable commercial or contract law.

(B) ACTIONS FOR NEGLIGENT ENTRUSTMENT.—A civil action for negligent entrustment shall not be subject to the provisions of

this title governing product liability actions,

but shall be subject to any applicable State

law.

(b) SCOPE OF PREEMPTION.—

(1) IN GENERAL.—This Act supersedes a

State law only to the extent that State law

applies to an issue covered under this title.

(2) ISSUES NOT COVERED UNDER THIS ACT.—

Any issue that is not covered under this

title, including any standard of liability applicable to a manufacturer, shall not be subject to this title, but shall be subject to applicable Federal or State law.

(c) STATUTORY CONSTRUCTION.—Nothing in

this title may be construed to—

(1) waive or affect any defense of sovereign

immunity asserted by any State under any

law;

(2) supersede or alter any Federal law;

(3) waive or affect any defense of sovereign

immunity asserted by the United States;

(4) affect the applicability of any provision

of chapter 97 of title 28, United States Code;

(5) preempt State choice-of-law rules with

respect to claims brought by a foreign nation

or a citizen of a foreign nation;

(6) 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; or

(7) supersede or modify any statutory or

common law, including any law providing for

an action to abate a nuisance, that authorizes a person to institute an action for civil

damages or civil penalties, cleanup costs, injunctions, restitution, cost recovery, punitive damages, or any other form of relief for

remediation of the environment (as defined

in section 101(8) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. 9601(8)) or the

threat of such remediation.

(d) CONSTRUCTION.—To promote uniformity

of law in the various jurisdictions, this title

shall be construed and applied after consideration of its legislative history.

(e) EFFECT OF COURT OF APPEALS DECISIONS.—Notwithstanding any other provision

of law, any decision of a circuit court of appeals interpreting a provision of this title

(except to the extent that the decision is

overruled or otherwise modified by the Supreme Court) shall be considered a controlling precedent with respect to any subsequent decision made concerning the interpretation of such provision by any Federal or

State court within the geographical boundaries of the area under the jurisdiction of the

circuit court of appeals.

SEC. 103. ALTERNATIVE DISPUTE RESOLUTION

PROCEDURES.

(a) SERVICE OF OFFER.—A claimant or a defendant in a product liability action that is

subject to this title may, not later than 60

days after the service of the initial complaint of the claimant or the applicable

deadline for a responsive pleading (whichever

is later), serve upon an adverse party an

offer to proceed pursuant to any voluntary,

nonbinding alternative dispute resolution

procedure established or recognized under

the law of the State in which the product liability action is brought or under the rules

of the court in which such action is maintained.

(b) WRITTEN NOTICE OF ACCEPTANCE OR REJECTION.—Except as provided in subsection

(c), not later than 10 days after the service of

an offer to proceed under subsection (a), an

offeree shall file a written notice of acceptance or rejection of the offer.

(c) EXTENSION.—The court may, upon motion by an offeree made prior to the expiration of the 10-day period specified in subsection (b), extend the period for filing a

written notice under such subsection for a

period of not more than 60 days after the

date of expiration of the period specified in

subsection (b). Discovery may be permitted

during such period.

SEC. 104. LIABILITY RULES APPLICABLE TO

PRODUCT SELLERS.

(a) GENERAL RULE.—

(1) IN GENERAL.—In any product liability

action that is subject to this title filed by a

claimant for harm caused by a product, a

product seller other than a manufacturer

shall be liable to a claimant, only if the

claimant establishes—

(A) that—

(i) the product that allegedly caused the

harm that is the subject of the complaint

was sold, rented, or leased by the product

seller;

(ii) the product seller failed to exercise

reasonable care with respect to the product;

and

(iii) the failure to exercise reasonable care

was a proximate cause of harm to the claimant; or

(B) that—

(i) the product seller made an express warranty applicable to the product that allegedly caused the harm that is the subject of

the complaint, independent of any express

warranty made by a manufacturer as to the

same product;

(ii) the product failed to conform to the

warranty; and

(iii) the failure of the product to conform

to the warranty caused harm to the claimant; or

(C) that—

(i) the product seller engaged in intentional wrongdoing, as determined under applicable State law; and

(ii) such intentional wrongdoing was a

proximate cause of the harm that is the subject of the complaint.

(2) REASONABLE OPPORTUNITY FOR INSPECTION.—For purposes of paragraph (1)(A)(ii), a

product seller shall not be considered to have

failed to exercise reasonable care with respect to a product based upon an alleged failure to inspect a product if the product seller

had no reasonable opportunity to inspect the

product that allegedly caused harm to the

claimant.

(b) SPECIAL RULE.—

(1) IN GENERAL.—A product seller shall be

deemed to be liable as a manufacturer of a

product for harm caused by the product if—

(A) the manufacturer is not subject to

service of process under the laws of any

State in which the action may be brought; or

(B) the court determines that the claimant

would be unable to enforce a judgment

against the manufacturer.

(2) STATUTE OF LIMITATIONS.—For purposes

of this subsection only, the statute of limitations applicable to claims asserting liability

of a product seller as a manufacturer shall be

tolled from the date of the filing of a complaint against the manufacturer to the date

that judgment is entered against the manufacturer.

(c) RENTED OR LEASED PRODUCTS.—

(1) Notwithstanding any other provision of

law, any person engaged in the business of

renting or leasing a product (other than a

person excluded from the definition of product seller under section 101 (14)(B)) shall be

subject to liability in a product liability action under subsection (a), but any person engaged in the business of renting or leasing a

product shall not be liable to a claimant for

the tortious act of another solely by reason

of ownership of such product.

(2) For purposes of paragraph (1), and for

determining the applicability of this title to

any person subject to paragraph (1), the term

‘‘product liability action’’ means a civil action brought on any theory for harm caused

by a product or product use.

SEC. 105. DEFENSES INVOLVING INTOXICATING

ALCOHOL OR DRUGS.

(a) GENERAL RULE.—Notwithstanding any

other provision of law, a defendant in a product liability action that is subject to this

title shall have a complete defense in the action if the defendant proves that—

(1) the claimant was under the influence of

intoxicating alcohol or any drug that may

not lawfully be sold over-the-counter without a prescription, and was not prescribed by

a physician for use by the claimant; and

(2) the claimant, as a result of the influence of the alcohol or drug, was more than 50

percent responsible for the accident or event

which resulted in the harm to the claimant.

(b) CONSTRUCTION.—For purposes of this

section, the determination of whether a person was intoxicated or was under the influence of intoxicating alcohol or any drug

shall be made pursuant to applicable State

law.

SEC. 106. REDUCTION FOR MISUSE OR ALTERATION OF PRODUCT.

(a) GENERAL RULE.—

(1) IN GENERAL.—Except as provided in subsection (c), in a product liability action that

is subject to this title, the damages for

which a defendant is otherwise liable under

applicable State law shall be reduced by the

percentage of responsibility for the harm to

the claimant attributable to misuse or alteration of a product by any person if the defendant establishes that such percentage of

the harm was proximately caused by a use or

alteration of a product—

(A) in violation of, or contrary to, the express warnings or instructions of the defendant if the warnings or instructions are determined to be adequate pursuant to applicable

State law; or

(B) involving a risk of harm which was

known or should have been known by the ordinary person who uses or consumes the

product with the knowledge common to the

class of persons who used or would be reasonably anticipated to use the product.

(2) USE INTENDED BY A MANUFACTURER IS

NOT MISUSE OR ALTERATION.—For the purposes of this title, a use of a product that is

intended by the manufacturer of the product

does not constitute a misuse or alteration of

the product.

(b) STATE LAW.—Notwithstanding section

3(b), subsection (a) of this section shall supersede State law concerning misuse or alteration of a product only to the extent that

State law is inconsistent with such subsection.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6409

(c) WORKPLACE INJURY.—Notwithstanding

subsection (a), the amount of damages for

which a defendant is otherwise liable under

State law shall not be reduced by the application of this section with respect to the

conduct of any employer or coemployee of

the plaintiff who is, under applicable State

law concerning workplace injuries, immune

from being subject to an action by the claimant.

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) LIMITATION ON AMOUNT.—

(1) IN GENERAL.—Except as provided in

paragraphs (2) and (3), 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 the

greater of—

(A) 2 times the sum of—

(i) the amount awarded to the claimant for

economic loss; and

(ii) the amount awarded to the claimant

for noneconomic loss; or

(B) $250,000.

(2) SPECIAL RULE.—The amount of punitive

damages that may be awarded in a product

liability action that is subject to this title

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 25 full-time employees, shall not exceed

the lesser of—

(A) 2 times the sum of—

(i) the amount awarded to the claimant for

economic loss; and

(ii) the amount awarded to the claimant

for noneconomic loss; or

(B) $250,000.

(3) EXCEPTION.—

(A) DETERMINATION BY COURT.—Notwithstanding subparagraph (C), in a product liability action that is subject to this title, if

the court makes a determination, after considering each of the factors in subparagraph

(B), that the application of paragraph (1)

would result in an award of punitive damages that is insufficient to punish the egregious conduct of the defendant against whom

the punitive damages are to be awarded or to

deter such conduct in the future, the court

shall determine the additional amount of punitive damages in excess of the amount determined in accordance with paragraph (1) to

be awarded to the claimant (referred to in

this paragraph as the ‘‘additur’’) in a separate proceeding in accordance with this paragraph.

(B) FACTORS FOR CONSIDERATION.—In any

proceeding under subparagraph (A), the

court shall consider—

(i) the extent to which the defendant acted

with actual malice;

(ii) the likelihood that serious harm would

arise from the misconduct of the defendant;

(iii) the degree of the awareness of the defendant of that likelihood;

(iv) the profitability of the misconduct to

the defendant;

(v) the duration of the misconduct and any

concurrent or subsequent concealment of the

conduct by the defendant;

(vi) the attitude and conduct of the defendant upon the discovery of the misconduct

and whether the misconduct has terminated;

(vii) the financial condition of the defendant; and

(viii) the cumulative deterrent effect of

other losses, damages, and punishment suffered by the defendant as a result of the misconduct, reducing the amount of punitive

damages on the basis of the economic impact

and severity of all measures to which the defendant has been or may be subjected, including—

(I) compensatory and punitive damage

awards to similarly situated claimants;

(II) the adverse economic effect of stigma

or loss of reputation;

(III) civil fines and criminal and administrative penalties; and

(IV) stop sale, cease and desist, and other

remedial or enforcement orders.

(C) REQUIREMENTS FOR AWARDING

ADDITURS.—If the court awards an additur

under this paragraph, the court shall state

its reasons for setting the amount of the

additur in findings of fact and conclusions of

law. If the additur is—

(i) accepted by the defendant, it shall be

entered by the court as a final judgment;

(ii) accepted by the defendant under protest, the order may be reviewed on appeal; or

(iii) not accepted by the defense, the court

shall set aside the punitive damages award

and order a new trial on the issue of punitive

damages only, and judgment shall enter

upon the verdict of liability and damages

after the issue of punitive damages is decided.

(4) APPLICATION BY COURT.—This subsection

shall be applied by the court and the application of this subsection shall not be disclosed

to the jury.

(5) REMITTITURS.—Nothing in this subsection shall modify or reduce the ability of

courts to order remittiturs.

(c) BIFURCATION AT REQUEST OF ANY

PARTY.—

(1) IN GENERAL.—At the request of any

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.

(2) INADMISSIBILITY OF EVIDENCE RELATIVE

ONLY TO A CLAIM OF PUNITIVE DAMAGES IN A

PROCEEDING CONCERNING COMPENSATORY DAMAGES.—If any party requests a separate proceeding under paragraph (1), in any proceeding to determine whether the claimant may

be awarded compensatory damages, any evidence that is relevant only to the claim of

punitive damages, as determined by applicable State law, shall be inadmissible.

SEC. 108. LIABILITY FOR CERTAIN CLAIMS RELATING TO DEATH.

In any civil action in which the alleged

harm to the claimant is death and, as of the

effective date of this Act, 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 without regard to section 107, but only

during such time as the State law so provides. This section shall cease to be effective

September 1, 1996.

SEC. 109. UNIFORM TIME LIMITATIONS ON LIABILITY.

(a) STATUTE OF LIMITATIONS.—

(1) IN GENERAL.—Except as provided in

paragraph (2) and subsection (b), a product

liability action that is subject to this title

may be filed not later than 2 years after the

date on which the claimant discovered or, in

the exercise of reasonable care, should have

discovered, the harm that is the subject of

the action and the cause of the harm.

(2) EXCEPTIONS.—

(A) PERSON WITH A LEGAL DISABILITY.—A

person with a legal disability (as determined

under applicable law) may file a product liability action that is subject to this title not

later than 2 years after the date on which

the person ceases to have the legal disability.

(B) EFFECT OF STAY OR INJUNCTION.—If the

commencement of a civil action that is subject to this title is stayed or enjoined, the

running of the statute of limitations under

this section shall be suspended until the end

of the period that the stay or injunction is in

effect.

(b) STATUTE OF REPOSE.—

(1) IN GENERAL.—Subject to paragraphs (2)

and (3), no product liability action that is

subject to this title concerning a product

that is a durable good alleged to have caused

harm (other than toxic harm) may be filed

after the 20-year period beginning at the

time of delivery of the product.

(2) STATE LAW.—Notwithstanding paragraph (1), if pursuant to an applicable State

law, an action described in such paragraph is

required to be filed during a period that is

shorter than the 20-year period specified in

such paragraph, the State law shall apply

with respect to such period.

(3) EXCEPTIONS.—

(A) A motor vehicle, vessel, aircraft, or

train that is used primarily to transport passengers for hire shall not be subject to this

subsection.

(B) Paragraph (1) does not bar a product liability action against a defendant who made

an express warranty in writing as to the

safety of the specific product involved which

was longer than 20 years, but it will apply at

the expiration of that warranty.

(C) Paragraph (1) does not affect the limitations period established by the General

Aviation Revitalization Act of 1994 (49 U.S.C.

40101 note).

(c) TRANSITIONAL PROVISION RELATING TO

EXTENSION OF PERIOD FOR BRINGING CERTAIN

ACTIONS.—If any provision of subsection (a)

or (b) shortens the period during which a

product liability action that could be otherwise brought pursuant to another provision

of law, the claimant may, notwithstanding

subsections (a) and (b), bring the product liability action pursuant to this title not later

than 1 year after the date of enactment of

this Act.

SEC. 110. SEVERAL LIABILITY FOR NONECONOMIC LOSS.

(a) GENERAL RULE.—In a product liability

action that is subject to this title, the liability of each defendant for noneconomic loss

shall be several only and shall not be joint.

(b) AMOUNT OF LIABILITY.—

(1) IN GENERAL.—Each defendant shall be

liable only for the amount of noneconomic

loss allocated to the defendant in direct proportion to the percentage of responsibility of

the defendant (determined in accordance

with paragraph (2)) for the harm to the

claimant with respect to which the defendant is liable. The court shall render a separate judgment against each defendant in an

amount determined pursuant to the preceding sentence.

(2) PERCENTAGE OF RESPONSIBILITY.—For

purposes of determining the amount of noneconomic loss allocated to a defendant under

this section, the trier of fact shall determine

the percentage of responsibility of each person responsible for the claimant’s harm,

whether or not such person is a party to the

action.

SEC. 111. WORKERS’ COMPENSATION SUBROGATION STANDARDS.

(a) GENERAL RULE.—

(1) RIGHT OF SUBROGATION.—

(A) IN GENERAL.—An insurer shall have a

right of subrogation against a manufacturer

or product seller to recover any claimant’s

benefits relating to harm that is the subject
S6410 CONGRESSIONAL RECORD — SENATE May 10, 1995

of a product liability action that is subject

to this title.

(B) WRITTEN NOTIFICATION.—To assert a

right of subrogation under subparagraph (A),

the insurer shall provide written notice to

the court in which the product liability action is brought.

(C) INSURER NOT REQUIRED TO BE A PARTY.—

An insurer shall not be required to be a necessary and proper party in a product liability

action covered under subparagraph (A).

(2) SETTLEMENTS AND OTHER LEGAL PROCEEDINGS.—

(A) IN GENERAL.—In any proceeding relating to harm or settlement with the manufacturer or product seller by a claimant who

files a product liability action that is subject

to this title, an insurer may participate to

assert a right of subrogation for claimant’s

benefits with respect to any payment made

by the manufacturer or product seller by

reason of such harm, without regard to

whether the payment is made—

(i) as part of a settlement;

(ii) in satisfaction of judgment;

(iii) as consideration for a covenant not to

sue; or

(iv) in another manner.

(B) WRITTEN NOTIFICATION.—Except as provided in subparagraph (C), an employee shall

not make any settlement with or accept any

payment from the manufacturer or product

seller without written notification to the

employer.

(C) EXEMPTION.—Subparagraph (B) shall

not apply in any case in which the insurer

has been compensated for the full amount of

the claimant’s benefits.

(3) HARM RESULTING FROM ACTION OF EMPLOYER OR COEMPLOYEE.—

(A) IN GENERAL.—If, with respect to a product liability action that is subject to this

title, the manufacturer or product seller attempts to persuade the trier of fact that the

harm to the claimant was caused by the

fault of the employer of the claimant or any

coemployee of the claimant, the issue of that

fault shall be submitted to the trier of fact,

but only after the manufacturer or product

seller has provided timely written notice to

the employer.

(B) RIGHTS OF EMPLOYER.—

(i) IN GENERAL.—Notwithstanding any

other provision of law, with respect to an

issue of fault submitted to a trier of fact pursuant to subparagraph (A), an employer

shall, in the same manner as any party in

the action (even if the employer is not a

named party in the action), have the right

to—

(I) appear;

(II) be represented;

(III) introduce evidence;

(IV) cross-examine adverse witnesses; and

(V) present arguments to the trier of fact.

(ii) LAST ISSUE.—The issue of harm resulting from an action of an employer or

coemployee shall be the last issue that is

presented to the trier of fact.

(C) REDUCTION OF DAMAGES.—If the trier of

fact finds by clear and convincing evidence

that the harm to the claimant that is the

subject of the product liability action was

caused by the fault of the employer or a

coemployee of the claimant—

(i) the court shall reduce by the amount of

the claimant’s benefits—

(I) the damages awarded against the manufacturer or product seller; and

(II) any corresponding insurer’s subrogation lien; and

(ii) the manufacturer or product seller

shall have no further right by way of contribution or otherwise against the employer.

(D) CERTAIN RIGHTS OF SUBROGATION NOT

AFFECTED.—Notwithstanding a finding by the

trier of fact described in subparagraph (C),

the insurer shall not lose any right of subrogation related to any—

(i) intentional tort committed against the

claimant by a coemployee; or

(ii) act committed by a coemployee outside

the scope of normal work practices.

(b) ATTORNEY’S FEES.—If, in a product liability action that is subject to this section,

the court finds that harm to a claimant was

not caused by the fault of the employer or a

coemployee of the claimant, the manufacturer or product seller shall reimburse the

insurer for reasonable attorney’s fees and

court costs incurred by the insurer in the action, as determined by the court.

SEC. 112. FEDERAL CAUSE OF ACTION PRECLUDED.

The district courts of the United States

shall not have jurisdiction under section 1331

or 1337 of title 28, United States Code, over

any product liability action covered under

this title.

TITLE II—BIOMATERIALS ACCESS

ASSURANCE

SEC. 201. SHORT TITLE.

This title may be cited as the

‘‘Biomaterials Access Assurance Act of

1995’’.

SEC. 202. FINDINGS.

Congress finds that—

(1) each year millions of citizens of the

United States depend on the availability of

lifesaving or life-enhancing medical devices,

many of which are permanently implantable

within the human body;

(2) a continued supply of raw materials and

component parts is necessary for the invention, development, improvement, and maintenance of the supply of the devices;

(3) most of the medical devices are made

with raw materials and component parts

that—

(A) are not designed or manufactured specifically for use in medical devices; and

(B) come in contact with internal human

tissue;

(4) the raw materials and component parts

also are used in a variety of nonmedical

products;

(5) because small quantities of the raw materials and component parts are used for

medical devices, sales of raw materials and

component parts for medical devices constitute an extremely small portion of the

overall market for the raw materials and

medical devices;

(6) under the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.), manufacturers of medical devices are required to demonstrate that the medical devices are safe

and effective, including demonstrating that

the products are properly designed and have

adequate warnings or instructions;

(7) notwithstanding the fact that raw materials and component parts suppliers do not

design, produce, or test a final medical device, the suppliers have been the subject of

actions alleging inadequate—

(A) design and testing of medical devices

manufactured with materials or parts supplied by the suppliers; or

(B) warnings related to the use of such

medical devices;

(8) even though suppliers of raw materials

and component parts have very rarely been

held liable in such actions, such suppliers

have ceased supplying certain raw materials

and component parts for use in medical devices because the costs associated with litigation in order to ensure a favorable judgment for the suppliers far exceeds the total

potential sales revenues from sales by such

suppliers to the medical device industry;

(9) unless alternate sources of supply can

be found, the unavailability of raw materials

and component parts for medical devices will

lead to unavailability of lifesaving and lifeenhancing medical devices;

(10) because other suppliers of the raw materials and component parts in foreign nations are refusing to sell raw materials or

component parts for use in manufacturing

certain medical devices in the United States,

the prospects for development of new sources

of supply for the full range of threatened raw

materials and component parts for medical

devices are remote;

(11) it is unlikely that the small market

for such raw materials and component parts

in the United States could support the large

investment needed to develop new suppliers

of such raw materials and component parts;

(12) attempts to develop such new suppliers

would raise the cost of medical devices;

(13) courts that have considered the duties

of the suppliers of the raw materials and

component parts have generally found that

the suppliers do not have a duty—

(A) to evaluate the safety and efficacy of

the use of a raw material or component part

in a medical device; and

(B) to warn consumers concerning the safety and effectiveness of a medical device;

(14) attempts to impose the duties referred

to in subparagraphs (A) and (B) of paragraph

(13) on suppliers of the raw materials and

component parts would cause more harm

than good by driving the suppliers to cease

supplying manufacturers of medical devices;

and

(15) in order to safeguard the availability

of a wide variety of lifesaving and life-enhancing medical devices, immediate action

is needed—

(A) to clarify the permissible bases of liability for suppliers of raw materials and

component parts for medical devices; and

(B) to provide expeditious procedures to

dispose of unwarranted suits against the suppliers in such manner as to minimize litigation costs.

SEC. 203. DEFINITIONS.

As used in this title:

(1) BIOMATERIALS SUPPLIER.—

(A) IN GENERAL.—The term ‘‘biomaterials

supplier’’ means an entity that directly or

indirectly supplies a component part or raw

material for use in the manufacture of an

implant.

(B) PERSONS INCLUDED.—Such term includes any person who—

(i) has submitted master files to the Secretary for purposes of premarket approval of

a medical device; or

(ii) licenses a biomaterials supplier to

produce component parts or raw materials.

(2) CLAIMANT.—

(A) IN GENERAL.—The term ‘‘claimant’’

means any person who brings a civil action,

or on whose behalf a civil action is brought,

arising from harm allegedly caused directly

or indirectly by an implant, including a person other than the individual into whose

body, or in contact with whose blood or tissue, the implant is placed, who claims to

have suffered harm as a result of the implant.

(B) ACTION BROUGHT ON BEHALF OF AN ESTATE.—With respect to an action brought on

behalf or through the estate of an individual

into whose body, or in contact with whose

blood or tissue the implant is placed, such

term includes the decedent that is the subject of the action.

(C) ACTION BROUGHT ON BEHALF OF A

MINOR.—With respect to an action brought

on behalf or through a minor, such term includes the parent or guardian of the minor.

(D) EXCLUSIONS.—Such term does not include—

(i) a provider of professional services, in

any case in which—

(I) the sale or use of an implant is incidental to the transaction; and
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6411

(II) the essence of the transaction is the

furnishing of judgment, skill, or services; or

(ii) a manufacturer, seller, or biomaterials

supplier.

(3) COMPONENT PART.—

(A) IN GENERAL.—The term ‘‘component

part’’ means a manufactured piece of an implant.

(B) CERTAIN COMPONENTS.—Such term includes a manufactured piece of an implant

that—

(i) has significant nonimplant applications;

and

(ii) alone, has no implant value or purpose,

but when combined with other component

parts and materials, constitutes an implant.

(4) HARM.—

(A) IN GENERAL.—The term ‘‘harm’’

means—

(i) any injury to or damage suffered by an

individual;

(ii) any illness, disease, or death of that individual resulting from that injury or damage; and

(iii) any loss to that individual or any

other individual resulting from that injury

or damage.

(B) EXCLUSION.—The term does not include

any commercial loss or loss of or damage to

an implant.

(5) IMPLANT.—The term ‘‘implant’’ means—

(A) a medical device that is intended by

the manufacturer of the device—

(i) to be placed into a surgically or naturally formed or existing cavity of the body

for a period of at least 30 days; or

(ii) to remain in contact with bodily fluids

or internal human tissue through a surgically produced opening for a period of less

than 30 days; and

(B) suture materials used in implant procedures.

(6) MANUFACTURER.—The term ‘‘manufacturer’’ means any person who, with respect

to an implant—

(A) is engaged in the manufacture, preparation, propagation, compounding, or processing (as defined in section 510(a)(1) of the

Federal Food, Drug, and Cosmetic Act (21

U.S.C. 360(a)(1)) of the implant; and

(B) is required—

(i) to register with the Secretary pursuant

to section 510 of the Federal Food, Drug, and

Cosmetic Act (21 U.S.C. 360) and the regulations issued under such section; and

(ii) to include the implant on a list of devices filed with the Secretary pursuant to

section 510(j) of such Act (21 U.S.C. 360(j))

and the regulations issued under such section.

(7) MEDICAL DEVICE.—The term ‘‘medical

device’’ means a device, as defined in section

201(h) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321(h)).

(8) RAW MATERIAL.—The term ‘‘raw material’’ means a substance or product that—

(A) has a generic use; and

(B) may be used in an application other

than an implant.

(9) SECRETARY.—The term ‘‘Secretary’’

means the Secretary of Health and Human

Services.

(10) SELLER.—

(A) IN GENERAL.—The term ‘‘seller’’ means

a person who, in the course of a business conducted for that purpose, sells, distributes,

leases, packages, labels, or otherwise places

an implant in the stream of commerce.

(B) EXCLUSIONS.—The term does not include—

(i) a seller or lessor of real property;

(ii) a provider of professional services, in

any case in which the sale or use of an implant is incidental to the transaction and the

essence of the transaction is the furnishing

of judgment, skill, or services; or

(iii) any person who acts in only a financial capacity with respect to the sale of an

implant.

SEC. 204. GENERAL REQUIREMENTS; APPLICABILITY; PREEMPTION.

(a) GENERAL REQUIREMENTS.—

(1) IN GENERAL.—In any civil action covered by this title, a biomaterials supplier

may raise any defense set forth in section

205.

(2) PROCEDURES.—Notwithstanding any

other provision of law, the Federal or State

court in which a civil action covered by this

title is pending shall, in connection with a

motion for dismissal or judgment based on a

defense described in paragraph (1), use the

procedures set forth in section 206.

(b) APPLICABILITY.—

(1) IN GENERAL.—Except as provided in

paragraph (2), notwithstanding any other

provision of law, this title applies to any

civil action brought by a claimant, whether

in a Federal or State court, against a manufacturer, seller, or biomaterials supplier, on

the basis of any legal theory, for harm allegedly caused by an implant.

(2) EXCLUSION.—A civil action brought by a

purchaser of a medical device for use in providing professional services against a manufacturer, seller, or biomaterials supplier for

loss or damage to an implant or for commercial loss to the purchaser—

(A) shall not be considered an action that

is subject to this title; and

(B) shall be governed by applicable commercial or contract law.

(c) SCOPE OF PREEMPTION.—

(1) IN GENERAL.—This title supersedes any

State law regarding recovery for harm

caused by an implant and any rule of procedure applicable to a civil action to recover

damages for such harm only to the extent

that this title establishes a rule of law applicable to the recovery of such damages.

(2) APPLICABILITY OF OTHER LAWS.—Any

issue that arises under this title and that is

not governed by a rule of law applicable to

the recovery of damages described in paragraph (1) shall be governed by applicable

Federal or State law.

(d) STATUTORY CONSTRUCTION.—Nothing in

this title may be construed—

(1) to affect any defense available to a defendant under any other provisions of Federal or State law in an action alleging harm

caused by an implant; or

(2) to create a cause of action or Federal

court jurisdiction pursuant to section 1331 or

1337 of title 28, United States Code, that otherwise would not exist under applicable Federal or State law.

SEC. 205. LIABILITY OF BIOMATERIALS SUPPLIERS.

(a) IN GENERAL.—

(1) EXCLUSION FROM LIABILITY.—Except as

provided in paragraph (2), a biomaterials

supplier shall not be liable for harm to a

claimant caused by an implant.

(2) LIABILITY.—A biomaterials supplier

that—

(A) is a manufacturer may be liable for

harm to a claimant described in subsection

(b);

(B) is a seller may be liable for harm to a

claimant described in subsection (c); and

(C) furnishes raw materials or component

parts that fail to meet applicable contractual requirements or specifications may be

liable for a harm to a claimant described in

subsection (d).

(b) LIABILITY AS MANUFACTURER.—

(1) IN GENERAL.—A biomaterials supplier

may, to the extent required and permitted

by any other applicable law, be liable for

harm to a claimant caused by an implant if

the biomaterials supplier is the manufacturer of the implant.

(2) GROUNDS FOR LIABILITY.—The

biomaterials supplier may be considered the

manufacturer of the implant that allegedly

caused harm to a claimant only if the

biomaterials supplier—

(A)(i) has registered with the Secretary

pursuant to section 510 of the Federal Food,

Drug, and Cosmetic Act (21 U.S.C. 360) and

the regulations issued under such section;

and

(ii) included the implant on a list of devices filed with the Secretary pursuant to

section 510(j) of such Act (21 U.S.C. 360(j))

and the regulations issued under such section;

(B) is the subject of a declaration issued by

the Secretary pursuant to paragraph (3) that

states that the supplier, with respect to the

implant that allegedly caused harm to the

claimant, was required to—

(i) register with the Secretary under section 510 of such Act (21 U.S.C. 360), and the

regulations issued under such section, but

failed to do so; or

(ii) include the implant on a list of devices

filed with the Secretary pursuant to section

510(j) of such Act (21 U.S.C. 360(j)) and the

regulations issued under such section, but

failed to do so; or

(C) is related by common ownership or control to a person meeting all the requirements

described in subparagraph (A) or (B), if the

court deciding a motion to dismiss in accordance with section 206(c)(3)(B)(i) finds, on the

basis of affidavits submitted in accordance

with section 206, that it is necessary to impose liability on the biomaterials supplier as

a manufacturer because the related manufacturer meeting the requirements of subparagraph (A) or (B) lacks sufficient financial resources to satisfy any judgment that

the court feels it is likely to enter should the

claimant prevail.

(3) ADMINISTRATIVE PROCEDURES.—

(A) IN GENERAL.—The Secretary may issue

a declaration described in paragraph (2)(B)

on the motion of the Secretary or on petition by any person, after providing—

(i) notice to the affected persons; and

(ii) an opportunity for an informal hearing.

(B) DOCKETING AND FINAL DECISION.—Immediately upon receipt of a petition filed pursuant to this paragraph, the Secretary shall

docket the petition. Not later than 180 days

after the petition is filed, the Secretary shall

issue a final decision on the petition.

(C) APPLICABILITY OF STATUTE OF LIMITATIONS.—Any applicable statute of limitations

shall toll during the period during which a

claimant has filed a petition with the Secretary under this paragraph.

(c) LIABILITY AS SELLER.—A biomaterials

supplier may, to the extent required and permitted by any other applicable law, be liable

as a seller for harm to a claimant caused by

an implant if—

(1) the biomaterials supplier—

(A) held title to the implant that allegedly

caused harm to the claimant as a result of

purchasing the implant after—

(i) the manufacture of the implant; and

(ii) the entrance of the implant in the

stream of commerce; and

(B) subsequently resold the implant; or

(2) the biomaterials supplier is related by

common ownership or control to a person

meeting all the requirements described in

paragraph (1), if a court deciding a motion to

dismiss in accordance with section

206(c)(3)(B)(i) finds, on the basis of affidavits

submitted in accordance with section 206,

that it is necessary to impose liability on

the biomaterials supplier as a seller because

the related manufacturer meeting the requirements of paragraph (1) lacks sufficient

financial resources to satisfy any judgment

that the court feels it is likely to enter

should the claimant prevail.
S6412 CONGRESSIONAL RECORD — SENATE May 10, 1995

(d) LIABILITY FOR VIOLATING CONTRACTUAL

REQUIREMENTS OR SPECIFICATIONS.—A

biomaterials supplier may, to the extent required and permitted by any other applicable

law, be liable for harm to a claimant caused

by an implant, if the claimant in an action

shows, by a preponderance of the evidence,

that—

(1) the raw materials or component parts

delivered by the biomaterials supplier either—

(A) did not constitute the product described in the contract between the

biomaterials supplier and the person who

contracted for delivery of the product; or

(B) failed to meet any specifications that

were—

(i) provided to the biomaterials supplier

and not expressly repudiated by the

biomaterials supplier prior to acceptance of

delivery of the raw materials or component

parts;

(ii)(I) published by the biomaterials supplier;

(II) provided to the manufacturer by the

biomaterials supplier; or

(III) contained in a master file that was

submitted by the biomaterials supplier to

the Secretary and that is currently maintained by the biomaterials supplier for purposes of premarket approval of medical devices; or

(iii)(I) included in the submissions for purposes of premarket approval or review by the

Secretary under section 510, 513, 515, or 520 of

the Federal Food, Drug, and Cosmetic Act

(21 U.S.C. 360, 360c, 360e, or 360j); and

(II) have received clearance from the Secretary,

if such specifications were provided by the

manufacturer to the biomaterials supplier

and were not expressly repudiated by the

biomaterials supplier prior to the acceptance

by the manufacturer of delivery of the raw

materials or component parts; and

(2) such conduct was an actual and proximate cause of the harm to the claimant.

SEC. 206. PROCEDURES FOR DISMISSAL OF CIVIL

ACTIONS AGAINST BIOMATERIALS

SUPPLIERS.

(a) MOTION TO DISMISS.—In any action that

is subject to this title, a biomaterials supplier who is a defendant in such action may,

at any time during which a motion to dismiss may be filed under an applicable law,

move to dismiss the action on the grounds

that—

(1) the defendant is a biomaterials supplier; and

(2)(A) the defendant should not, for the

purposes of—

(i) section 205(b), be considered to be a

manufacturer of the implant that is subject

to such section; or

(ii) section 205(c), be considered to be a

seller of the implant that allegedly caused

harm to the claimant; or

(B)(i) the claimant has failed to establish,

pursuant to section 205(d), that the supplier

furnished raw materials or component parts

in violation of contractual requirements or

specifications; or

(ii) the claimant has failed to comply with

the procedural requirements of subsection

(b).

(b) MANUFACTURER OF IMPLANT SHALL BE

NAMED A PARTY.—The claimant shall be required to name the manufacturer of the implant as a party to the action, unless—

(1) the manufacturer is subject to service

of process solely in a jurisdiction in which

the biomaterials supplier is not domiciled or

subject to a service of process; or

(2) an action against the manufacturer is

barred by applicable law.

(c) PROCEEDING ON MOTION TO DISMISS.—

The following rules shall apply to any proceeding on a motion to dismiss filed under

this section:

(1) AFFIDAVITS RELATING TO LISTING AND

DECLARATIONS.—

(A) IN GENERAL.—The defendant in the action may submit an affidavit demonstrating

that defendant has not included the implant

on a list, if any, filed with the Secretary pursuant to section 510(j) of the Federal Food,

Drug, and Cosmetic Act (21 U.S.C. 360(j)).

(B) RESPONSE TO MOTION TO DISMISS.—In response to the motion to dismiss, the claimant may submit an affidavit demonstrating

that—

(i) the Secretary has, with respect to the

defendant and the implant that allegedly

caused harm to the claimant, issued a declaration pursuant to section 205(b)(2)(B); or

(ii) the defendant who filed the motion to

dismiss is a seller of the implant who is liable under section 205(c).

(2) EFFECT OF MOTION TO DISMISS ON DISCOVERY.—

(A) IN GENERAL.—If a defendant files a motion to dismiss under paragraph (1) or (2) of

subsection (a), no discovery shall be permitted in connection to the action that is

the subject of the motion, other than discovery necessary to determine a motion to dismiss for lack of jurisdiction, until such time

as the court rules on the motion to dismiss

in accordance with the affidavits submitted

by the parties in accordance with this section.

(B) DISCOVERY.—If a defendant files a motion to dismiss under subsection (a)(2) on the

grounds that the biomaterials supplier did

not furnish raw materials or component

parts in violation of contractual requirements or specifications, the court may permit discovery, as ordered by the court. The

discovery conducted pursuant to this subparagraph shall be limited to issues that are

directly relevant to—

(i) the pending motion to dismiss; or

(ii) the jurisdiction of the court.

(3) AFFIDAVITS RELATING STATUS OF DEFENDANT.—

(A) IN GENERAL.—Except as provided in

clauses (i) and (ii) of subparagraph (B), the

court shall consider a defendant to be a

biomaterials supplier who is not subject to

an action for harm to a claimant caused by

an implant, other than an action relating to

liability for a violation of contractual requirements or specifications described in

subsection (d).

(B) RESPONSES TO MOTION TO DISMISS.—The

court shall grant a motion to dismiss any action that asserts liability of the defendant

under subsection (b) or (c) of section 205 on

the grounds that the defendant is not a manufacturer subject to such section 205(b) or

seller subject to section 205(c), unless the

claimant submits a valid affidavit that demonstrates that—

(i) with respect to a motion to dismiss contending the defendant is not a manufacturer,

the defendant meets the applicable requirements for liability as a manufacturer under

section 205(b); or

(ii) with respect to a motion to dismiss

contending that the defendant is not a seller,

the defendant meets the applicable requirements for liability as a seller under section

205(c).

(4) BASIS OF RULING ON MOTION TO DISMISS.—

(A) IN GENERAL.—The court shall rule on a

motion to dismiss filed under subsection (a)

solely on the basis of the pleadings of the

parties made pursuant to this section and

any affidavits submitted by the parties pursuant to this section.

(B) MOTION FOR SUMMARY JUDGMENT.—Notwithstanding any other provision of law, if

the court determines that the pleadings and

affidavits made by parties pursuant to this

section raise genuine issues as concerning

material facts with respect to a motion concerning contractual requirements and specifications, the court may deem the motion to

dismiss to be a motion for summary judgment made pursuant to subsection (d).

(d) SUMMARY JUDGMENT.—

(1) IN GENERAL.—

(A) BASIS FOR ENTRY OF JUDGMENT.—A

biomaterials supplier shall be entitled to

entry of judgment without trial if the court

finds there is no genuine issue as concerning

any material fact for each applicable element set forth in paragraphs (1) and (2) of

section 205(d).

(B) ISSUES OF MATERIAL FACT.—With respect to a finding made under subparagraph

(A), the court shall consider a genuine issue

of material fact to exist only if the evidence

submitted by claimant would be sufficient to

allow a reasonable jury to reach a verdict for

the claimant if the jury found the evidence

to be credible.

(2) DISCOVERY MADE PRIOR TO A RULING ON A

MOTION FOR SUMMARY JUDGMENT.—If, under

applicable rules, the court permits discovery

prior to a ruling on a motion for summary

judgment made pursuant to this subsection,

such discovery shall be limited solely to establishing whether a genuine issue of material fact exists.

(3) DISCOVERY WITH RESPECT TO A

BIOMATERIALS SUPPLIER.—A biomaterials

supplier shall be subject to discovery in connection with a motion seeking dismissal or

summary judgment on the basis of the inapplicability of section 205(d) or the failure to

establish the applicable elements of section

205(d) solely to the extent permitted by the

applicable Federal or State rules for discovery against nonparties.

(e) STAY PENDING PETITION FOR DECLARATION.—If a claimant has filed a petition for a

declaration pursuant to section 205(b) with

respect to a defendant, and the Secretary has

not issued a final decision on the petition,

the court shall stay all proceedings with respect to that defendant until such time as

the Secretary has issued a final decision on

the petition.

(f) MANUFACTURER CONDUCT OF PROCEEDING.—The manufacturer of an implant that is

the subject of an action covered under this

title shall be permitted to file and conduct a

proceeding on any motion for summary judgment or dismissal filed by a biomaterials

supplier who is a defendant under this section if the manufacturer and any other defendant in such action enter into a valid and

applicable contractual agreement under

which the manufacturer agrees to bear the

cost of such proceeding or to conduct such

proceeding.

(g) ATTORNEY FEES.—The court shall require the claimant to compensate the

biomaterials supplier (or a manufacturer appearing in lieu of a supplier pursuant to subsection (f)) for attorney fees and costs, if—

(1) the claimant named or joined the

biomaterials supplier; and

(2) the court found the claim against the

biomaterials supplier to be without merit

and frivolous.

SEC. 207. APPLICABILITY.

This title shall apply to all civil actions

covered under this title that are commenced

on or after the date of enactment of this Act,

including any such action with respect to

which the harm asserted in the action or the

conduct that caused the harm occurred before the date of enactment of this Act.

Mr. GORTON. Mr. President, I move

to reconsider the vote.

Mr. ROCKEFELLER. I move to lay

that motion on the table.

The motion to lay on the table was

agreed to.
May 10, 1995 CONGRESSIONAL RECORD — SENATE S6413

Mr. GORTON addressed the Chair.

The PRESIDING OFFICER. The Senator from Washington.

Mr. GORTON. Mr. President, I would

want to take this opportunity to first

congratulate the majority of the Members of the Senate and Members on

both sides of the aisle for by far the

most significant step in legal reform

which has been taken by the Senate in

many, many years, perhaps in the

memory of the most senior of the sitting Senators. This has been a project

by members of the Commerce Committee which has lasted for a decade and a

half. It also, I may say, after 21⁄2 weeks

of debate, has been one in which the

views of the Members had an impact,

had an impact in showing that a majority of the Senate, a bare majority,

wants a broader legal reform package

than is included in this bill, but that

others worried about particular details

were willing to work on those details,

and to cast their votes accordingly. So

I believe that the Senate has worked

its will in a particularly fine fashion.

I want to pay particular tribute to

my colleague, the Senator from West

Virginia [Mr. ROCKEFELLER]. In many

respects this has been a far more difficult task for him than it has been for

me. I represent a broad coalition of

views within my own political party

with only a few having had differences.

Senator ROCKEFELLER throughout this

entire period of time has spoken for a

significant number of Members of his

colleagues but by no means a majority

of them. But his dedication to the

cause of this reform has been exemplary, and his persuasive ability with

many of those colleagues has constantly left me in awe and with a great

deal of inspiration. I believe that his

persistence has paid off, and how wonderfully that it has done so.

I have gotten to know Tamera Stanton, his legislative director, and Ellen

Doneski, his legislative assistant, very

well during the course of this period of

time and know how much they have

contributed to his success, as has Trent

Erickson, Lance Bultena, Jeanne

Bumpus for me, and the majority leader’s assistant, Kyle McSlarrow.

Other Senators have contributed significantly to this result, the chairman

of the Commerce Committee, Senator

PRESSLER, Senator COVERDELL, and

Senators SNOWE and DEWINE who came

up with the formula for punitive damages which appealed to the majority of

Members of this body.

I only regret that Senator

LIEBERMAN, the other principal cosponsor of this bill, through a family emergency is absent today. I know that he

would like to have been in on the end

of this. But his contributions are greatly appreciated. And he is one of the primary authors of the portion of this bill

that deals with medical devices.

Now we go on to try to get a final

proposal passed by the Congress and

through the President of the United

States.

The majority leader has been patient

in allowing us 21⁄2 weeks on this, and

was an absolute key to its success as

well.

With that, I think he wishes us to go

on to another subject.

Mr. HOLLINGS addressed the Chair.

The PRESIDING OFFICER. The Senator from South Carolina.

Mr. HOLLINGS. Mr. President, I too

want to at this moment thank those

who have been in the trenches over the

years and, of course, most of all my

distinguished colleague, the Senator

from Alabama. It is always good to get

in behind the chief justice because you

know you are on the side of the law and

of equity, and you know you are on the

side of the judgment. Certainly it is, as

we all revere him ethically, that you

are on the side of ethics and equity.

I thank publicly Senator HEFLIN for

his leadership, and particularly Winston Lett, a member of his staff. On my

staff, Kevin Curtin, Jim Drewry, Moses

Boyd, James Leventis, and Lloyd Ator.

They have been working around the

clock, Kevin and Moses and others

have been working in sort of a minority position on this measure.

The record would show that my particular Commerce Committee has over

the past several Congresses voted by a

majority to report this bill. So we have

had a sort of uphill fight. I still feel

that, of course, we had the merit. I

guess they feel they had the merit. But

in any event, I think the 15-year holdup was because of that on our side. I

also would like to thank Senator

BIDEN’s staff, the Senator himself,

Sean Moylan, Karen Robb. And then

with respect to, of course, the medical

malpractice part, we did not have hearings but Health and Human Resources

did. The distinguished former chairman, Senator KENNEDY, was the leader

on that.

We had, of course, the vigorous help

of Senator BOXER and Senator

WELLSTONE. So it has been thoroughly

aired and properly heard. The Senate

has voted. But let us see what the

House crowd comes up with in the contract.

I yield the floor.

Mr. HEFLIN addressed the Chair.

The PRESIDING OFFICER. The Senator from Alabama.

Mr. HEFLIN. Mr. President, I would

like to congratulate Senator HOLLINGS

for his outstanding work in regard to

it, although we did not come out victorious. He is a great comrade in arms

and has had a vast amount of experience on this matter. I suppose that

looking back over the years, 15 or more

years, he has fought these battles and I

have been with him throughout, and he

has tremendous knowledge in this area.

Originally, this bill was designed not

to go to Judiciary. It was designed to

go to Commerce. At that time, Senator

HOLLINGS was not chairman. But obviously, it is a bill that deals with the judicial system. From the very beginning

it was designed to avoid a careful scrutiny in regards its judicial impact. Fortunately, over the years, we had an individual who was an outstanding lawyer, and who had been an outstanding

trial lawyer, Senator HOLLINGS in the

State of South Carolina, and who has

been there to deal with this matter.

I would also like to thank the staffs

of Senator HOLLINGS and others who

have been so important. They have

really exhibited tremendous knowledge

of the law. They have followed this legislation diligently and have done a tremendous job. Senator HOLLINGS has

named them, and I will not repeat their

names. But on my staff, Winston Lett

and Jim Whiddon have worked tirelessly and diligently on this legislation, and I thank them for their great

service in our legislative efforts.

I also want to congratulate Senator

ROCKEFELLER and Senator GORTON for

their advocacy in pushing forward on

their bill. They just seem to have better allies than we did. I always at the

end of a lawsuit, whether I won or lost,

went over and congratulated my opposing counsel, and do so today. We will be

having other battles as they come

down the road, and sometimes we will

be compatriots. We will be cosponsors

and joint fighters in the same cause.

Then, as it is with all Senators, we will

be on opposite sides again in the future

on some issue. But that is the way the

Senate works; that is the way democracy works. During the debate on a

great issue, you can disagree but you

do not have to be disagreeable.

I think that Senator GORTON and

Senator ROCKEFELLER never showed

any disagreeable nature. I disagreed

with them with respect to the cause

the were advancing, but not in the

manner they advanced it; they played

fair and square. I want to thank them

particularly for working out a settlement in regard to the unique and different situation as to Alabama’s

wrongful death statute.

We worked out a situation by which

the amendment was adopted giving

time to our State legislature or to our

courts or to both to find a solution to

be able to fit into this bill, if it is finally passed.

Then I want to say, while I will congratulate them, please do not take that

as any indication that I have ceased to

fight. I have not surrendered and will

not give up in my efforts to maintain

the traditional role of the 50 States in

allowing them to fashion their own solutions to problems which may arise

with regard to product liability laws. I

believe the 10th amendment to the U.S.

Constitution still has some meaning,

and I will continue to assert the primacy of the States on these matters.

There are appeals. There are appeals

to conference, there are appeals to the

White House, there are appeals to the

President to eliminate the unfairness

of the bill or to see the death of this

unfair bill. So we will continue to

fight. The battle is not over. We have

not surrendered, and we will continue

to battle in the future because we feel

we are battling for the injured parties,
S6414 CONGRESSIONAL RECORD — SENATE May 10, 1995

the consumers of America, and that we

have right on our side. And we ask the

Lord to give us a little more guidance

in regard to these appeals as we move

forward.

So I thank everybody concerned who

has put up with me, and we will continue to battle on this issue as well as

other issues that come up that affect

the rights of the people.

Mr. DOLE addressed the Chair.

The PRESIDING OFFICER. The majority leader.

Mr. DOLE. Mr. President, let me

thank all of my colleagues for the fact

we finished this bill. It has been 2

weeks and 2 days, but there were a couple of interruptions—the death of

former Senator Stennis and other matters. So it was not solid. We probably

did it in about 8 or 9 days.

We have had a lot of good debate on

both sides. I congratulate all the principal players, Senators HEFLIN and

HOLLINGS, also Senator ROCKEFELLER

and Senator GORTON, who were on the

winning side of this issue. I think they

did a remarkable job in keeping a very

fragile, narrow coalition together. We

broadened the bill with narrow margins. I think we knew at the time those

provisions would not be in the bill or

we could not obtain the 60 votes we

needed for cloture, so adjustments were

made. But at least we made a record on

medical malpractice, on punitive damages, and on other issues that we believe are very important and we believe

will be back before the Senate.

I also wish to thank Senator

COVERDELL for his work with outside

groups as sort of the coordinator, and

my colleague, Senator LOTT of Mississippi, the majority whip, who did an

excellent job, along with his staff and

members of my staff and others because we had some very difficult votes.

I think we have had a dramatic step

forward. The product liability bill has

been introduced in every Congress for

the last decade. In most cases, however, we could not even muster the

votes to consider the legislation. We

could not get the 60 votes to even talk

about it because we had strong opposition and we had a lot of what we

thought were distortions. The other

side would say not.

So I think passage today is an important victory for common sense and the

American people. It is also important

to note that we have just passed a bill

that was stronger than bills introduced

in previous years, stronger because of

the efforts of some of our Members in

the Chamber that added small business

protections.

I wish to pay tribute to our newest

Members, who as a group provided energy, ideas, and determination in this

debate. Senators SNOWE and DEWINE

made a significant contribution that

allowed us to obtain meaningful protection from abusive punitive damages

while protecting small businesses.

Senators ABRAHAM and KYL responded to the call of the American

people in last year’s elections by their

efforts to expand these protections to

include volunteer and charitable organizations and to add needed civil justice reforms. Together with Senators

KASSEBAUM and MCCONNELL, who introduced medical malpractice reforms,

they produced something never before

seen on the Senate floor—clearer majorities for broader reform. For various

reasons, we could not get the 60 votes

to bring debate to a close on these

broader reforms, but we have had the

opportunity and I think it is certainly

important.

Just 3 days ago, I received a letter

from the head of the Boy Scouts of

America, Mr. Jere Ratcliffe. In just the

second line of his letter, Mr. Ratcliffe

says something that ought to cause all

of us to pause. I quote:

The civil justice system, as it now exists,

has consequences which worked a chilling effect on our willingness and ability to continue to pursue activities that are beneficial

to all of us. . . . This is particularly so in

the case of volunteer service organizations.

That is what he believes. That is

what many of us believe. So we have

heard from the trial lawyers. They say

everything is fine, but the volunteer

organizations tell us a different story.

I would just say that we hope to

bring up sometime later this year or, if

not, next year the McConnellLieberman-Kassebaum health care liability bill—hopefully, later this year.

The amendment was added by a 53 to 47

vote. In addition, some Senators support medical malpractice reform but

voted against that amendment last

week because they wanted to pursue

only a product liability bill. So we are

going to revisit that later in the year.

We have a lot of work to do. I do not

know how late it is going to be. But in

any event, we will be taking a hard

look at that legislation, hopefully this

year; if not, early next year.

So, again, I thank the managers,

Senator GORTON and Senator ROCKEFELLER. This is a bipartisan effort, as

are most things in the Senate because

without a bipartisan effort, you cannot

get the 60 votes to shut off debate and

pass the bill. That is the way it works.

Some people may not totally understand it, may disagree with it, but that

is the way it works. So now we move to

another legislative matter, which I

would ask the Chair to report.

INTERSTATE TRANSPORTATION OF

MUNICIPAL SOLID WASTE ACT

fThe PRESIDING OFFICER. Under

the previous order, the hour of noon

having arrived, the Senate will now

proceed to the consideration of S. 534,

which the clerk will now report.

The legislative clerk read as follows:

A bill (S. 534) to amend the Solid Waste

Disposal Act to provide authority for States

to limit the interstate transportation of municipal solid waste and for other purposes.

The Senate proceeded to consider the

bill which had been reported from the

Committee on Energy and Natural Resources with an amendment to strike

out all after the enacting clause and

inserting in lieu thereof the following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Interstate

Transportation of Municipal Solid Waste Act

of 1995’’.

TITLE I—INTERSTATE WASTE

SEC. 101. INTERSTATE TRANSPORTATION OF MUNICIPAL SOLID WASTE.

(a) AMENDMENT.—Subtitle D of the Solid

Waste Disposal Act (42 U.S.C. 6941 et seq.) is

amended by adding at the end the following

new section:

‘‘SEC. 4011. INTERSTATE TRANSPORTATION OF

MUNICIPAL SOLID WASTE.

‘‘(a) AUTHORITY TO RESTRICT OUT-OF-STATE

MUNICIPAL SOLID WASTE.—(1) Except as provided in paragraph (4), immediately upon the

date of enactment of this section if requested

in writing by an affected local government, a

Governor may prohibit the disposal of outof-State municipal solid waste in any landfill or incinerator that is not covered by the

exceptions provided in subsection (b) and

that is subject to the jurisdiction of the Governor and the affected local government.

‘‘(2) Except as provided in paragraph (4),

immediately upon the date of publication of

the list required in paragraph (6)(D) and notwithstanding the absence of a request in

writing by the affected local government, a

Governor, in accordance with paragraph (5),

may limit the quantity of out-of-State municipal solid waste received for disposal at

each landfill or incinerator covered by the

exceptions provided in subsection (b) that is

subject to the jurisdiction of the Governor,

to an annual amount equal to or greater

than the quantity of out-of-State municipal

solid waste received for disposal at such

landfill or incinerator during calendar year

1993.

‘‘(3)(A) Except as provided in paragraph (4),

immediately upon the date of publication of

the list required in paragraph (6)(E), and notwithstanding the absence of a request in

writing by the affected local government, a

Governor, in accordance with paragraph (5),

may prohibit or limit the amount of out-ofState municipal solid waste disposed of at

any landfill or incinerator covered by the exceptions in subsection (b) that is subject to

the jurisdiction of the Governor, generated

in any State that is determined by the Administrator under paragraph (6)(E) as having

exported, to landfills or incinerators not covered by host community agreements or permits authorizing receipt of out-of-State municipal solid waste, more than—

‘‘(i) 3,500,000 tons of municipal solid waste

in calendar year 1996;

‘‘(ii) 3,000,000 tons of municipal solid waste

in each of calendar years 1997 and 1998;

‘‘(iii) 2,500,000 tons of municipal solid waste

in each of calendar years 1999 and 2000;

‘‘(iv) 1,500,000 tons of municipal solid waste

in each of calendar years 2001 and 2002; and

‘‘(v) 1,000,000 tons of municipal solid waste

in calendar year 2003 and each year thereafter.

‘‘(B)(i) No State may export to landfills or

incinerators in any 1 State that are not covered by host community agreements more

than the following amounts of municipal

solid waste:

‘‘(I) In calendar year 1996, the greater of

1,400,000 tons or 90 percent of the amount exported to the State in calendar year 1993.

‘‘(II) In calendar year 1997, the greater of

1,300,000 tons or 90 percent of the amount exported to the State in calendar year 1996.

‘‘(III) In calendar year 1998, the greater of

1,200,000 tons or 90 percent of the amount exported to the State in calendar year 1997.

‘‘(IV) In calendar year 1999, the greater of

1,100,000 tons or 90 percent of the amount exported to the State in calendar year 1998.