Health Care Liability Reform Act

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Health Care Liability Reform Act''.

SEC. 2. HEALTH CARE LIABILITY REFORM.

    (a) Punitive Damages.--
            (1) Award.--Punitive damages may, to the extent permitted 
        by applicable State law, be awarded against a manufacturer or 
        product seller in a civil action if the claimant establishes by 
        clear and convincing evidence that the harm suffered was the 
        result of conduct manifesting actual malice.
            (2) Drugs and devices.--The manufacturer of a prescription 
        drug or device and a health care provider shall not be subject 
        to punitive damages with respect to harm caused by a drug or 
        device if the drug or device was approved under the Federal 
        Food, Drug, and Cosmetic Act unless--
                    (A) the manufacturer withholds from the Food and 
                Drug Administration, or
                    (B) the health care provider withholds from a 
                patient,
        information which is relevant to the performance of the drug or 
        device and causally related to the harm suffered by the 
        plaintiff.
            (3) Limitation on amount.--The amount of punitive damages 
        that may be awarded for a claim in any civil action shall not 
        exceed 3 times the amount awarded to the claimant for the 
        economic injury on which such claim is based, or $250,000, 
        whichever is greater.
    (b) Several Liability for Noneconomic Damages.--In any action, the 
liability of each manufacturer or product seller of the product 
involved in such action shall be several only and shall not be joint 
for noneconomic damages. Such manufacturer or product seller shall be 
liable only for the amount of noneconomic damages allocated to such 
manufacturer or seller in direct proportion to such manufacturer's or 
such seller's percentage of responsibility as determined by the trier 
of fact.
    (c) Definitions.--As used in this section:
            (1) Claimant.--The term ``claimant'' means any person who 
        brings a product liability action and any person on whose 
        behalf such an action is brought, including such person's 
        decedent if such an action is brought through or on behalf of 
        an estate or such person's legal representative if it is 
        brought through or on behalf of a minor or incompetent.
            (2) Malice.--The term ``malice'' means conduct that is 
        either--
                    (A) specifically intended to cause serious personal 
                injury, or
                    (B) carried out with both a flagrant indifference 
                to the rights of the claimant and an awareness that 
                such conduct is likely to result in serious personal 
                injury.
            (3) Manufacturer.--With respect to a product, the term 
        ``manufacturer'' means--
                    (A) any person who is engaged in a business to 
                produce, create, make, or construct the product and who 
                designs or formulates the product or has engaged 
                another person to design or formulate the product,
                    (B) a product seller of the product who, before 
                placing the product in the stream of commerce--
                            (i) designs or formulates or has engaged 
                        another person to design or formulate an aspect 
                        of the product after the product was initially 
                        made by another, and
                            (ii) produces, creates, makes, or 
                        constructs such aspect of the product, or
                    (C) any product seller not described in 
                subparagraph (B) which holds itself out as a 
                manufacturer to the user of the product,
            (4) Product.--The term ``product''--
                    (A) means any object, substance, mixture, or raw 
                material in a gaseous, liquid, or solid state--
                            (i) which is capable of delivery itself, 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, and
                    (B) 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,
            (5) Product seller.--The term ``product seller''--
                    (A) means a person--
                            (i) who sells, distributes, leases, 
                        prepares, blends, packages, or labels a product 
                        or is otherwise involved in placing a product 
                        in the stream of commerce, or
                            (ii) who installs, repairs, or maintains 
                        the harm-causing aspect of a product, and
                    (B) does not include--
                            (i) a manufacturer,
                            (ii) a seller or lessor of real property,
                            (iii) 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,
                            (iv) any person who acts only in a 
                        financial capacity with respect to the sale of 
                        a product, or
                            (v) any person who leases a product under a 
                        lease arrangement in which the selection, 
                        possession, maintenance, and operation of the 
                        product are controlled by a person other than 
                        the lessor.

SEC. 3. PREEMPTION.

    This Act preempts State law, with respect to both procedural and 
substantive measures, to the extent that such law--
            (1) permits the recovery of a greater amount of punitive 
        damages by a plaintiff than that authorized by section 2(a)(3); 
        or
            (2) permits an action for joint liability for noneconomic 
        damages against a manufacturer or product seller of a product 
        involved in the action, which action is prohibited by section 
        2(b).
Any issue that is not governed by this Act shall be governed by 
otherwise applicable State or Federal law.

Summary: Prohibits the manufacturer of a prescription drug or device and a health care provider from being subject to punitive damages with respect to harm caused by a drug or device if the drug or device was approved under the Federal Food, Drug, and Cosmetic Act unless: (1)the manufacturer withholds from the Food and Drug Administration; or (2) the health care provider withholds from a patient, information which is relevant to the performance of the drug or device and causally related to the harm suffered by the plaintiff.