[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 2537 Introduced in Senate (IS)]

103d CONGRESS
  2d Session
                                S. 2537

  To regulate interstate commerce by providing uniform principles to 
  address the multiple imposition of punitive damages, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

            October 7 (legislative day, September 12), 1994

 Mr. Danforth introduced the following bill; which was read twice and 
               referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
  To regulate interstate commerce by providing uniform principles to 
  address the multiple imposition of punitive damages, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Multiple Punitive Damages Fairness 
Act''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents of this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Findings.
Sec. 4. Purpose.
Sec. 5. Definitions.
Sec. 6. General rule.
Sec. 7. Applicability; preemption; jurisdiction of Federal courts.
Sec. 8. Effective date.

SEC. 3. FINDINGS.

    The Congress finds the following:
            (1) Multiple or repetitive imposition of punitive damages 
        for harms arising out of a single act or course of conduct may 
        deprive a defendant of all of the assets or insurance coverage 
        of the defendant, and may endanger the ability of claimants to 
        receive compensation for basic out-of-pocket expenses and 
        damages for pain and suffering.
            (2) The detrimental impact of multiple punitive damages 
        exists even in cases that are settled, rather than tried, 
        because the threat of punitive damages being awarded results in 
        a settlement that provides for a higher award amount than would 
        ordinarily be obtained. To the extent that this premium exceeds 
        what would otherwise be a fair and reasonable settlement for 
        compensatory damages, assets that could be available for 
        satisfaction of future compensatory claims are dissipated.
            (3) Fundamental unfairness results when anyone is punished 
        repeatedly for what is essentially the same conduct.
            (4) Federal and State appellate and trial judges, and well-
        respected commentators, have expressed concern that multiple 
        imposition of punitive damages may violate constitutionally 
        protected rights.
            (5) Multiple imposition of punitive damages may be a 
        significant obstacle to global settlement negotiations in 
        repetitive litigation.
            (6) Limiting the imposition of multiple punitive damages 
        awards would facilitate the resolution of mass tort claims 
        involving thousands of injured claimants.
            (7) Federal and State trial courts cannot provide solutions 
        to problems caused by the multiple imposition of punitive 
        damages because they lack the power or authority to prohibit 
        subsequent awards in other courts.
            (8) Individual State legislatures can create only a partial 
        remedy to address problems caused by the multiple imposition of 
        punitive damages, because each State lacks the power to control 
        the imposition of punitive damages in other States.

SEC. 4. PURPOSE.

    The purpose of this Act is to provide a fair and balanced 
resolution to the problem of multiple imposition of punitive damages in 
interstate commerce.

SEC. 5. DEFINITIONS.

    As used in this Act--
            (1) the term ``punitive damages'' means damages awarded 
        against any person or entity to punish or deter such person or 
        entity, or others, from engaging in similar behavior in the 
        future;
            (2) the term ``specific findings of fact'' are findings in 
        written form focusing on specific behavior of a defendant that 
        demonstrates a conscious, flagrant, indifference to the safety 
        or welfare of the claimant; and
            (3) the term ``claimant'' means--
                    (A) any person who brings a civil action and any 
                person on behalf of whom such action is brought;
                    (B) if such action is brought through or on behalf 
                of an estate, the term includes the claimant's 
                decedent; and
                    (C) if such action is brought through or on behalf 
                of a minor or incompetent, the term includes the 
                claimant's parent or guardian.

SEC. 6. GENERAL RULE.

    (a) General Rule.--Except as provided in subsection (b), punitive 
damages shall be prohibited in any civil action in Federal or State 
court in which such damages are sought against a defendant based on the 
same act or course of conduct for which punitive damages have already 
been awarded against such defendant.
    (b) Circumstances for Award.--
            (1) Substantial new evidence.--If the court determines in a 
        pre-trial hearing that the claimant will offer new and 
        substantial evidence of previously undiscovered, additional 
        wrongful behavior on the part of the defendant, other than the 
        injury to the claimant, the court may award punitive damages in 
        accordance with subsection (c).
            (2) Insufficient award.--If the court determines in a pre-
        trial hearing that the amount of punitive damages previously 
        imposed were insufficient to either punish the defendant's 
        wrongful conduct or to deter the defendant and others from 
        similar behavior in the future, the court may award punitive 
        damages in accordance with subsection (c).
    (c) Limitations on Award.--A court awarding punitive damages 
pursuant to subsection (b) shall--
            (1) make specific findings of fact on the record to support 
        the award;
            (2) reduce the amount of the punitive portion of the damage 
        award by the sum of the amounts of punitive damages previously 
        paid by the defendant in prior actions based on the same act or 
        course of conduct; and
            (3) prohibit disclosure to the jury of the court's 
        determination and action under this subsection.

SEC. 7. APPLICABILITY; PREEMPTION; JURISDICTION OF FEDERAL COURTS.

    (a) Applicability to Punitive Damages Actions.--
            (1) In general.--Except as provided in paragraph (2), this 
        Act shall apply to any civil action brought on any theory where 
        punitive damages are sought based on the same act or course of 
        conduct for which punitive damages have already been awarded 
        against the defendant.
            (2) Statutory exception.--This Act shall not apply to any 
        civil action involving damages awarded under any Federal or 
        State statute that prescribes the amount of punitive damages to 
        be awarded.
    (b) Preemption.--Except as provided in subsection (a)(2), this Act 
shall supersede any Federal or State law regarding recovery for 
punitive damages.
    (c) Jurisdiction of Federal Courts.--The district courts of the 
United States shall not have jurisdiction over any civil action 
pursuant to this Act based on sections 1331 or 1337 of title 28, United 
States Code.

SEC. 8. EFFECTIVE DATE.

    (a) In General.--This Act shall take effect on the date of its 
enactment.
    (b) Pending Actions.--This Act shall apply to--
            (1) any civil action pending on the date of enactment of 
        this Act; and
            (2) any civil action commenced on or after such date, 
        including any action in which the harm or the conduct which 
        caused the harm occurred prior to such date.
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