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ATLA Congressional Update

On November 19, Congress wrapped up a few final details and headed home for the year. However, after many times at bat during the first session of the 106th Congress, the "tort reformers" -- occupying more than 90 days in committee hearings, bill-writing committee sessions, and on the floor of the House and Senate -- came away with no major victories that will adversely impact consumers and the civil justice system.

"If this Congress is known for anything, it will be that it didn't do any serious harm," said the Brookings Institution's Thomas Mann, a congressional expert.

But, have no fear, the "tort reformers" will be back. Still on their agenda are: asbestos liability limitation; small business liability limitation; elimination of vicarious liability (especially for rental cars); a federal statute of repose for workplace products; a multiparty, multiforum jurisdiction bill; an attempt to federalize virtually all class actions; and a federal auto no-fault bill.

On the positive side, the U.S. House passed by an overwhelming margin a Patients' Bill of Rights that would allow patients to sue their managed care insurers, and public pressure for its enactment is mounting as we approach the 2000 elections.

The following is a round-up of the results and status of various bills that appeared in Congress this session.

Y2K Liability Limits

This past Summer, Congress enacted Y2K legislation limiting the liability of those who manufactured and sold products with Y2K defects. Largely as a result of the efforts of ATLA, consumer advocates and small business groups, however, the law is confined to commercial injury (there is no liability limitation for personal physical injury) and will be in force for only three years. The most likely victims of the defect and the law are small businesses, whose supposed representatives -- the U.S. Chamber of Commerce and the National Federation of Independent Businesses -- worked tirelessly for its enactment contrary to the interests of their members.

Asbestos Immunity

House Judiciary Committee Chairman Henry Hyde announced at the Tuesday, November 2, meeting during which two bills threatening the civil justice system were to be finalized that the proposed asbestos legislation (H.R. 1283, "The Fairness in Asbestos Compensation Act") -- advocated principally by the GAF Corp.-- will not be considered until January or February, 2000.

Chairman Hyde indicated, however, that a new version of the bill, which he hopes to develop over the next few months, will then be a high priority. He hopes a re-written bill will attract bipartisan support. As currently written, the bill would set up an elaborate bureaucracy to screen out sick, but not yet disabled, asbestos victims, and limit the liability of asbestos manufacturers.

While most asbestos companies believe the current system is working well for all parties (only 55 cases came to trial in 1998, while Owens Corning, for example, settled 217,000 cases that year), the GAF Corporation, which no longer has insurance coverage, is the principal advocate of proposed legislation, which would set up an elaborate bureaucracy and medical criteria prepared by corporate lawyers to screen out 60 to 80 percent of potential claimants.

ATLA testified against H.R. 1283 in July (click here for a summary of this testimony). A Senate hearing on Sen. Ashcroft's S. 758 was held on October 5. ATLA president Richard H. Middleton, Jr., testified against this bill. His testimony and statement can be found here.

ATLA will continue to vigorously oppose these measures, which assure not one penny of compensation to even one asbestos victim, while shielding from liability an industry responsible for the injury or death of millions of workers and consumers.

Small Business Liability Protection

Committee consideration of the Small Business Liability Relief Act (H.R. 2366 by Reps. Rogan and Holden) also was postponed by Chairman Hyde on November 2, and is not expected to be brought up again in committee until next year. The bill would eliminate joint and several liability and cap punitive damages at the lesser of $250,000 or three times compensatory damages in all civil actions for businesses with 25 or fewer employees. It also eliminates vicarious liability (19 state laws preempted) for lessors and renters of products (for example, rental car companies, where the vicarious liability provides for uninsured and underinsured drivers to whom the companies readily rent vehicles).

ATLA is opposed to this unnecessary measure, which would only succeed in preventing children and other injured consumers from recovering the full costs of injuries caused by those rare small businesses which manufacture or sell very dangerous products or harmful services. ATLA president Richard H. Middleton, Jr., testified against HR 2366. His extensive, fact-filled testimony can be found here.

Car Rental Company Immunity

On November 2, by a narrow 12 to 11 mostly party-line vote (one Republican, Rep. Lazio [R-NY], voted with the Democrats against the bill), a Judiciary subcommittee approved H.R. 1954, the "Rental Fairness Act," a bill that would eliminate vicarious liability for rental car companies in the 12 states where it now fully applies and the 13 states where rental car companies are primary insurers. That legislation will likely be taken up by the full committee next year.

Vicarious liability ensures that injured parties are compensated for the harm they have suffered, and encourage renters and lessors of cars, and other merchants, to monitor their products and services more carefully, thereby ensuring safer products in the marketplace. This bill chooses to protect a thriving car rental industry rather than preserve a long-standing legal principle, and derogates state prerogatives on behalf of special interests. Former ATLA president Larry S. Stewart testified against this measure in the Senate (S. 1130). His testimony can be found here.

Workplace Goods Job Growth and Competitiveness Act

H.R. 2005, the "Workplace Goods Job Growth and Competitiveness Act of 1999," has been reported for consideration, and will be on the House floor sometime when Congress returns in January. This bill, which is being pushed by business interests, would completely cut off the rights of workers to hold wrongdoers accountable when they are injured by a defective product, industrial machine, construction tool, etc. that is more than 18 years old, regardless of how long the product was built to last.

This bill would apply to injured workers who are covered by workers' compensation. For these workers, recovery for harm suffered is drastically limited -- they would only be able to recover the actual funds they have lost and nothing more. That means covered workers who have lost fingers or arms or who will have lingering brain damage or other serious effects cannot recover anything for the very real pain and suffering they have endured. ATLA is working hard to fight back this unfair bill.

Patients' Bill of Rights

The House-Senate Conference Committee to work out radical differences between the House and Senate versions of the Patients' Bill of Rights will hold staff meetings during the months Congress is in adjournment. No further action is expected until next year.

The House-passed Bipartisan Consensus Managed Care Improvement Act, which has been combined with another bill opposed by many who supported the HMO bill, eliminates the ERISA preemption of state causes of action against managed care insurers who cause injury or death by delaying or denying needed care. The Senate bill contains no right to sue and has been called the "HMO Bill of Rights."

Note: For the latest version of these bills and their status, see and search at the top of the page for the bill number.


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