I
104TH CONGRESS
1ST SESSION
H. R. 955
To establish legal standards and procedures for product liability litigation,
and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 15, 1995
Mr. HYDE introduced the following bill; which was referred to the Committee
on the Judiciary
A BILL
To establish legal standards and procedures for product
liability litigation, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Common Sense Prod-
uct Liability Reform Act of 1995’’.
SEC. 2. FEDERAL CAUSE OF ACTION PRECLUDED.
This Act does not provide the district courts of the
United States with jurisdiction over product liability ac-
tions based on section 1331 or 1337 of title 28, United
States Code.
SEC. 3. APPLICABILITY AND PREEMPTION.
(a) PREEMPTION.—This Act governs any product li-
ability action brought in any State or Federal court
against a manufacturer or product seller, on any theory
for harm caused by a product. A product liability action
brought against a manufacturer or product seller for com-
mercial loss shall be governed only by applicable commer-
cial or contract law.
(b) RELATIONSHIP TO STATE LAW.—This Act super-
sedes State law only to the extent that State law applies
to an issue covered by this Act. Any issue that is not gov-
erned by this Act shall be governed by otherwise applicable
State or Federal law.
(c) APPLICABILITY.—Nothing in this Act shall be
construed to—
(1) waive or affect any defense of sovereign im-
munity asserted by any State under any law;
(2) supersede any Federal law, except the Fed-
eral 
Employers 
Compensation 
Act 
and 
the
Longshore and Harbor Workers’ Compensation Act;
(3) waive or affect any defense of sovereign im-
munity 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 re-
spect to claims brought by a foreign nation or a citi-
zen 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 any Federal law that prescribes a
specific regimen for punitive damages.
SEC. 4. LIABILITY RULES APPLICABLE TO PRODUCT
SELLERS.
(a) GENERAL RULE.—Except as provided in sub-
section (b), in any product liability action, a product seller
other than a manufacturer shall be liable to a claimant
only if the claimant establishes that—
(1)(A) the product which allegedly caused the
harm complained of was sold by the product seller;
(B) the product seller failed to exercise reasonable
care with respect to the product; and (C) such fail-
ure to exercise reasonable care was a proximate
cause of the claimant’s harm; or
(2)(A) the product seller made an express war-
ranty applicable to the product which allegedly
caused the harm complained of, independent of any
express warranty made by a manufacturer as to the
same product; (B) the product failed to conform to
the warranty; and (C) the failure of the product to
conform to the warranty caused the claimant’s
harm; or
(3) the product seller engaged in intentional
wrongdoing as determined under applicable State
law and such intentional wrongdoing was a proxi-
mate cause of the harm complained of by the
claimant.
For purposes of subparagraph (1)(B), a product seller
shall not be considered to have failed to exercise reason-
able care with respect to the product based upon an al-
leged failure to inspect a product where there was no rea-
sonable opportunity to inspect the product in a manner
which would, in the exercise of reasonable care, have re-
vealed the aspect of the product which allegedly caused
the claimant’s harm.
(b) EXCEPTION.—In a product liability action, a
product seller shall be liable for harm to the claimant
caused by such product as if the product seller were the
manufacturer of such product if—
(1) the manufacturer is not subject to service of
process under the laws of any State in which the ac-
tion might have been brought; or
(2) the court determines that the claimant
would be unable to enforce a judgment against the
manufacturer.
SEC. 5. DEFENSE BASED ON CLAIMANT’S USE OF INTOXI-
CATING ALCOHOL OR DRUGS.
(a) GENERAL RULE.—In any product liability action,
it shall be a complete defense to such action if—
(1) the claimant was intoxicated or was under
the influence of intoxicating alcohol or any drug; and
(2) the claimant, as a result of the influence of
the alcohol or drug, was more than 50 percent re-
sponsible for the accident or event which resulted in
such claimant’s harm.
(b) CONSTRUCTION.—For purposes of this section—
(1) the determination of whether a person was
intoxicated or was under the influence of intoxicat-
ing alcohol or any drug shall be made pursuant to
applicable State law; and
(2) the term ‘‘drug’’ means any controlled sub-
stance as defined in the Controlled Substances Act
(21 U.S.C. 802(6)) that has been taken by the
claimant other than in accordance with the terms of
a lawfully issued prescription.
SEC. 6. SEVERAL LIABILITY FOR NONECONOMIC LOSS.
In any product liability action, the liability of each
defendant for noneconomic loss shall be several only and
shall not be joint. Each defendant shall be liable only for
the amount of noneconomic loss attributable to such de-
fendant in direct proportion to such defendant’s propor-
tionate share of fault or responsibility for the claimant’s
harm, as determined by the trier of fact.
SEC. 7. STATUTE OF REPOSE.
A product liability action shall be barred unless the
complaint is served and filed within 15 years after the
time of delivery of the product. For the purposes of this
section, the term ‘‘time of delivery’’ means the time when
a product is delivered to its first purchaser or lessee who
was not involved in the business of manufacturing or sell-
ing such product or using it as a component part of an-
other product to be sold. This section applies only if the
harm caused by a product did not include chronic illness
and only to claims arising after the date of enactment of
this Act. This section does not affect the provisions of the
General Aviation Revitalization Act of 1994.
SEC. 8. PUNITIVE DAMAGES.
(a) GENERAL RULE.—Punitive damages may, to the
extent permitted by applicable State law, be awarded in
any product liability action in any Federal or State court
against a defendant if the claimant establishes by clear
and convincing evidence that the harm suffered was result
of conduct specifically intended to cause harm or conduct
manifesting a conscious, flagrant indifference to the safety
of those persons who might be harmed by the product for
which the action was brought.
(b) PROPORTIONAL AWARDS.—The amount of puni-
tive damages that may be awarded for a claim in any prod-
uct liability action subject to this Act shall not exceed 3
times the amount of damages awarded to the claimant for
the economic loss on which such claim is based, or
$250,000, whichever is greater. This provision shall be ap-
plied by the court and shall not be disclosed to the jury.
(c) APPLICABILITY AND PREEMPTION.—Except as
provided in section 2, this section shall apply to any prod-
uct liability action brought in any Federal or State court
on any theory where punitive damages are sought. This
section does not create a cause of action for punitive dam-
ages in any jurisdiction that does not authorize such ac-
tions.
(d) BIFURCATION AT EITHER PARTY’S REQUEST.—
At the request of either party, the trier of fact shall con-
sider in a separate proceeding whether punitive damages
are to be awarded and the amount of such award. If a
separate proceeding is requested, evidence relevant only to
the claim of punitive damages, as determined by applicable
State law, shall be inadmissible in any proceeding to deter-
mine whether compensatory damages are to be awarded.
SEC. 9. DEFINITIONS.
As used in this Act:
(1) The term ‘‘claimant’’ means any person who
brings a product liability action and any person on
whose behalf such an action is brought. If such an
action is brought through or on behalf of an estate,
the term includes the claimant’s decedent. If such
action is brought through or on behalf of a minor
or incompetent, the term includes the claimant’s
legal guardian.
(2) The term ‘‘clear and convincing evidence’’
means that measure or degree of proof that will
produce in the mind of the trier of fact a firm belief
or conviction as to the truth of the allegations
sought to be established. The level of proof required
to satisfy such standard is more than that required
under preponderance of the evidence, but less than
that required for proof beyond a reasonable doubt.
(3) The term ‘‘commercial loss’’ means any loss
incurred in the course of the ongoing business enter-
prise consisting of providing goods or services for
compensation.
(4) The term ‘‘economic loss’’ means any pecu-
niary loss resulting from harm (including the loss of
earnings, medical expense loss, replacement services
loss, loss due to death, burial costs, and loss of busi-
ness or employment opportunities) to the extent re-
covery for such loss is allowed under applicable State
law.
(5) The term ‘‘harm’’ means any physical in-
jury, illness, disease, or death caused by a product.
The term does not include commercial loss or loss or
damage to a product itself.
(6) The term ‘‘manufacturer’’ means—
(A) any person who is engaged in a busi-
ness to produce, create, make, or construct any
product (or component part of a product) and
who (i) designs or formulates the product (or
component part of the product), (ii) has en-
gaged another person to design or formulate
the product (or component part of the product),
or (iii) uses the design or formulation of the
product developed by another person;
(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, cre-
ates, makes, or constructs and designs or for-
mulates, or has engaged another person to de-
sign or formulate, an aspect of a product (or
component part of a product) made by another;
or
(C) any product seller not described in
subparagraph (B) which holds itself out as a
manufacturer to the user of the product.
(7) The term ‘‘nominal damages’’ means dam-
ages not more than $500.
(8) The term ‘‘noneconomic loss’’ means subjec-
tive, nonmonetary loss resulting from harm, includ-
ing pain, suffering, inconvenience, mental suffering,
emotional distress, loss of society and companion-
ship, loss of consortium, injury to reputation, and
humiliation.
(9) The term ‘‘person’’ means any individual,
corporation, company, association, firm, partnership,
society, joint stock company, or any other entity (in-
cluding any governmental entity).
(10)(A) The term ‘‘product’’ means any object,
substance, mixture, or raw material in a gaseous,
liquid, or solid state—
(i) which is capable of delivery itself or as
an assembled whole, in a mixed or combined
state, or as a component part or ingredient;
(ii) which is produced for introduction into
trade or commerce;
(iii) which has intrinsic economic value;
and
(iv) which is intended for sale or lease to
persons for commercial or personal use.
(B) The term does not include—
(i) human tissue, human organs,
human blood, and human blood products;
or
(ii) electricity, water delivered by a
utility, natural gas, or steam.
(11) The term ‘‘product liability action’’ means
a civil action brought on any theory for harm caused
by a product.
(12) The term ‘‘product seller’’ means a person
who, in the course of a business conducted for that
purpose, sells, distributes, leases, prepares, blends,
packages, labels, or otherwise is involved in placing
a product in the stream of commerce, or who in-
stalls, repairs, or maintains the harm-causing aspect
of a product. The term does not include—
(A) a seller or lessor of real property;
(B) 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 judg-
ment, skill, or services; or
(C) 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 ar-
rangement in which the selection, posses-
sion, maintenance, and operation of the
product are controlled by a person other
than the lessor.
(13) The term ‘‘punitive damages’’ means dam-
ages awarded against any person or entity to punish
or deter such person or entity, or others, from en-
gaging in similar behavior in the future.
(14) The term ‘‘State’’ means any State of the
United States, the District of Columbia, Puerto
Rico, the Northern Mariana Island, the Virgin Is-
lands, Guam, American Samoa, and any other terri-
tory or possession of the United States, or any polit-
ical subdivision of any of the foregoing.
SEC. 10. EFFECTIVE DATE.
This Act shall apply with respect to product liability
actions which are commenced after the date of the enact-
ment of this Act.
Æ