[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7080 Introduced in House (IH)]







110th CONGRESS
  2d Session
                                H. R. 7080

  To eliminate certain provisions of law providing benefits to trial 
                    lawyers, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 25, 2008

Mr. Boehner (for himself, Mr. Smith of Texas, and Mr. Blunt) introduced 
    the following bill; which was referred to the Committee on the 
 Judiciary, and in addition to the Committee on Ways and Means, for a 
 period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL


 
  To eliminate certain provisions of law providing benefits to trial 
                    lawyers, 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 ``Stop Trial Lawyer Pork Act''.

           TITLE I--ELIMINATION OF BENEFITS FOR TRIAL LAWYERS

SEC. 101. FINDINGS.

    The Congress finds the following:
            (1) In the spring of 2008, former powerhouse trial lawyer 
        William Lerach was sentenced to a two-year term in Federal 
        prison for his role in a $250 million criminal scheme of 
        illegal kickbacks to plaintiffs. Shortly before his sentencing, 
        Mr. Lerach told the Wall Street Journal that illegal kickbacks 
        to people recruited to file class action lawsuits is an 
        ``industry practice'' in the American trial lawyer business. 
        Mr. Lerach and fellow powerhouse trial lawyer Melvin Weiss, who 
        collaborated on the scheme together as members of the law firm 
        formerly known as Milberg Weiss, are now both serving time in 
        Federal prison for their roles in this criminal scheme.
            (2) In an unrelated but equally troubling instance of 
        corruption in the trial lawyer industry, one of the wealthiest 
        trial lawyers in America, Richard ``Dickie'' Scruggs of 
        Mississippi, pled guilty in March 2008 to bribing a State judge 
        in order to obtain higher legal fees. Mr. Scruggs is now 
        serving time in Federal prison.
            (3) In May 2008, in response to these troubling 
        developments, the minority leader, Mr. Boehner of Ohio, and the 
        ranking minority member of the Committee on the Judiciary, Mr. 
        Lamar Smith of Texas, asked the Chairman of the Judiciary 
        Committee, Mr. Conyers of Michigan, and the Speaker of the 
        House, Ms. Pelosi of California, to schedule a bipartisan 
        investigatory hearing to examine Mr. Lerach's assertion that 
        illegal activity is an ``industry practice'' in the trial 
        lawyer industry. In making the request, the minority leader and 
        the ranking member cited growing evidence that illegitimate and 
        predatory lawsuits are destroying jobs, harming the nation's 
        economy, and endangering the prosperity of American families.
            (4) The Washington Post has called for ``a sober discussion 
        about how best to achieve a fairer, more balanced legal system 
        through comprehensive tort reform''.
            (5) As of September 2008, the minority's request for a 
        bipartisan congressional response to reports of trial lawyer 
        corruption has been ignored, and no hearings have been 
        conducted on the Milberg Weiss scandal or the broader issues 
        raised by the recent trial lawyer scandals.
            (6) Instead of investigating the trial lawyer industry and 
        examining the potential threat to American jobs posed by the 
        illegal activity Mr. Lerach calls an ``industry practice'', the 
        majority has provided a steady flow of special legislative 
        favors to the trial lawyer industry since the start of the 
        110th Congress. Numerous provisions have been inserted into 
        bills on behalf of the trial lawyer industry by the majority, 
        often with little scrutiny or debate. One of the most egregious 
        instances of this trial lawyer pork is the new tax benefit 
        contained in H.R. 6049, which passed the House on March 21, 
        2008. It is estimated this provision will hand lawyers, and 
        only lawyers, a $1.6 billion windfall over the next 10 years at 
        the expense of U.S. taxpayers and American jobs.
            (7) According to the Center for Responsive Politics, 
        lawyers and law firms gave $85 million to Democratic candidates 
        during the 2006 election cycle. And in return for the stream of 
        special legislative favors it has received from the majority, 
        the trial lawyer industry has further increased its political 
        support for the majority during the current Congress. According 
        to National Journal: ``In the first quarter of 2008, the AAJ 
        [American Association for Justice, formerly known as the 
        Association of Trial Lawyers of America] spent $1.1 million on 
        lobbying in Washington, according to disclosure reports it 
        filed with Congress. Lawyers and law firms are also playing in 
        the political arena--they are the No. 1 sector among donors to 
        Federal candidates in this election cycle, with $83 million in 
        contributions, according the Center for Responsive Politics. Of 
        that amount, the American Association for Justice political 
        action committee has contributed $1.9 million to candidates, 95 
        percent to Democrats'' (Swindell, Bill; ``Trial Lawyers Mount a 
        Comeback'', National Journal, July 12, 2008).
            (8) Instead of providing special favors to benefit the 
        scandal-plagued American trial lawyer industry, the 110th 
        Congress should be investigating the industry. The trial lawyer 
        pork inserted into legislation by the majority during the 110th 
        Congress should be shut down, and bipartisan investigatory 
        hearings should be scheduled immediately to determine the 
        extent to which the illegal activity William Lerach describes 
        as an ``industry practice'' in the trial lawyer business is 
        destroying American jobs and harming the prosperity of working 
        families.

SEC. 102. ELIMINATION OF CERTAIN PROVISIONS OF LAW BENEFITTING TRIAL 
              LAWYERS.

    (a) In General.--Provisions of law that benefit trial lawyers to 
the detriment of consumers in any of the following categories shall 
have no force or effect, whether enacted before, on, or after the date 
of the enactment of this Act:
            (1) Anti-protective orders, such as the Sunshine in 
        Litigation Act of 2008 (H.R. 5884).
            (2) Broadening maritime lawsuits such as the Coast Guard 
        Authorization Act of 2008 (section 405 of H.R. 2830).
            (3) Prohibition of uniform Federal law and expansion of 
        medical liability lawsuits such as the FDA preemption 
        legislation in the Medical Device Safety Act of 2008 (H.R. 
        6381).
            (4) Expansion of environmental lawsuits such as the Carbon-
        Neutral Government Act of 2007 (section 212(f) of H.R. 2635).
            (5) Ending arbitration agreements such as the Arbitration 
        Fairness Act of 2007 (H.R. 3010), the Fairness in Nursing Home 
        Arbitration Act of 2008 (H.R. 6126), and the Automobile 
        Arbitration Fairness Act of 2008 (H.R. 5312).
            (6) Expansion of asbestos lawsuits such as the Ban Asbestos 
        in America Act of 2007 (H.R. 3285) and the Bruce Vento Ban 
        Asbestos and Prevent Mesothelioma Act of 2007 (H.R. 3339).
            (7) Expansion of products liability lawsuits such as the 
        Protecting Americans from Unsafe Foreign Products Act (H.R. 
        5913).
            (8) Providing tax breaks for lawsuits such as the Renewable 
        Energy and Job Creation Act of 2008 (section 311 of H.R. 6049).
    (b) Rule of Construction.--A provision of an Act of Congress 
enacted after the date of the enactment of this Act that would not have 
effect by reason of subsection (a) may nonetheless take effect if the 
Act enacting that provision--
            (1) by specific reference cites a report of the General 
        Accountability Office that concludes that--
                    (A) such provision would not benefit trial lawyers 
                to the detriment of consumers; and
                    (B) in the absence of such provision, there are no 
                other means of remedy or enforcement including State 
                and Federal oversight and State or Federal civil or 
                criminal actions; and
            (2) has been determined by the Congressional Budget Office 
        not to have a negative fiscal impact.

TITLE II--CLARITY AND TRANSPARENCY IN THE CREATION OF PRIVATE RIGHTS OF 
                        ACTION UNDER FEDERAL LAW

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Clarity and Transparency in 
Lawsuits Act'' or ``CATLA''.

SEC. 202. FINDINGS.

    The Congress finds the following:
            (1) Private rights of action shift enforcement and public 
        policy decisions from regulatory agencies to private lawyers 
        representing individual plaintiffs.
            (2) Courts are routinely asked to recognize implied rights 
        of action under Federal law. Such implied rights of action add 
        unpredictability to the civil justice system and may have 
        unforeseen adverse consequences.
            (3) The merits of creating a private right of action should 
        be subject to open debate and close consideration in Congress. 
        Such determinations should not be left to guesswork by courts 
        seeking to uncover legislative intent.
            (4) This legislation will fulfill the strong suggestion of 
        the Supreme Court of the United States that ``[w]hen Congress 
        intends private litigants to have a cause of action to support 
        their statutory rights, the far better course is for it to 
        specify as much when it creates those rights.'' Cannon v. 
        University of Chicago, 441 U.S. 677, 717 (1979).
            (5) On numerous occasions, Congress has enacted statutes 
        that explicitly provide a private right of action.
            (6) Expressly stating any private right of action will 
        eliminate uncertainty for both potential plaintiffs and 
        defendants, will reduce unnecessary, protracted and costly 
        litigation, and will avoid the confusion of inconsistent or 
        conflicting court decisions.

SEC. 203. CLARITY AND TRANSPARENCY IN PRIVATE RIGHTS OF ACTION.

    Any Federal law creating a private right of action shall include 
express language providing for such a right. No Federal or State court 
shall construe any Federal law to imply a private right of action in 
absence of such an express provision.

SEC. 204. EFFECTIVE DATE.

    This Act shall take effect on the date of the enactment of this Act 
and shall apply prospectively and to those previously enacted laws that 
have not already been interpreted by the Supreme Court to create a 
private right of action.

TITLE III--PROSECUTING OR COUNSELING CLAIMS OR DEFENSES THAT ARE FALSE, 
                   FRIVOLOUS, OR WHOLLY INSUBSTANTIAL

SEC. 301. PROSECUTING OR COUNSELING CLAIMS OR DEFENSES THAT ARE FALSE, 
              FRIVOLOUS, OR WHOLLY INSUBSTANTIAL.

    (a) In General.--No attorney at law shall in any litigation, in or 
affecting commerce among the States or with foreign nations, prosecute 
or counsel any action, or assert any claim or defense, which is false, 
frivolous, or wholly insubstantial.
    (b) Sanction.--The sanction for a violation of this section shall 
consist of an order to pay to the party or parties the amount of the 
reasonable expenses incurred as a direct result of the violation, 
including reasonable attorneys' fees and costs. The court may also 
impose additional appropriate sanctions, such as striking the 
pleadings, dismissing the suit, or other directives of a nonmonetary 
nature, or, if warranted for effective deterrence, an order directing 
payment of a penalty into the court.

                   TITLE IV--LAWSUIT ABUSE REDUCTION

SEC. 401. SHORT TITLE.

    This title may be cited as the ``Lawsuit Abuse Reduction Act''.

SEC. 402. ATTORNEY ACCOUNTABILITY.

    (a) Sanctions Under Rule 11.--Rule 11(c) of the Federal Rules of 
Civil Procedure is amended--
            (1) in paragraph (1), by striking ``may'' and inserting 
        ``shall'';
            (2) in paragraph (2), by striking ``Rule 5'' and all that 
        follows through ``motion.'' and inserting ``Rule 5.''; and
            (3) in paragraph (4), by striking ``situated'' and all that 
        follows through the end of the paragraph and inserting 
        ``situated, and to compensate the parties that were injured by 
        such conduct. Subject to the limitations in paragraph (5), the 
        sanction shall consist of an order to pay to the party or 
        parties the amount of the reasonable expenses incurred as a 
        direct result of the violation, including reasonable attorneys' 
        fees and costs. The court may also impose additional 
        appropriate sanctions, such as striking the pleadings, 
        dismissing the suit, or other directives of a nonmonetary 
        nature, or, if warranted for effective deterrence, an order 
        directing payment of a penalty into the court'' ; and
            (4) by adding at the end the following:
            ``(7) Appeal.--An attorney has the right to appeal a 
        sanction under this subdivision. While such an appeal is 
        pending, the sanction shall be stayed.''.
    (b) Rule of Construction for Civil Rights Claims.--Rule 11 of the 
Federal Rules of Civil Procedure is amended by adding at the end the 
following:
    ``(e) Rule of Construction for Civil Rights Claims.--Nothing in 
subdivisions (a) through (c) of this rule shall be construed to bar or 
impede the assertion or development of new claims or remedies under 
Federal, State, or local civil rights law.''.

SEC. 403. PREVENTION OF INTERSTATE FORUM-SHOPPING.

    (a) Generally.--A person may not bring a personal injury claim in 
the court of a State if the person is not a resident of that State 
unless all or a substantial part of the acts or omissions giving rise 
to the claim asserted occurred in that State.
    (b) Alternate Venue.--Notwithstanding subsection (a) and subject to 
subsection (g), if a person cannot obtain jurisdiction in either 
Federal or State court against the defendant in the State where all or 
a substantial part of the acts or omissions giving rise to the claim 
asserted occurred, then the claim may be filed in a court of another 
State, unless barred by the statute of limitations or otherwise time 
barred in the State where the action arose, if--
            (1) the defendant's principal place of business is located 
        in that State, if the defendant is a corporation, or
            (2) the defendant resides in that State, if the defendant 
        is an individual.
A person bringing such an action shall be required to establish, by 
filing an affidavit with the complaint for consideration by the court, 
that such action cannot be maintained in the State where the action 
arose due to lack of any legal basis to obtain personal jurisdiction 
over the defendant.
    (c) Joinder and Intervention.--In a civil action where more than 
one plaintiff is joined, each plaintiff must independently satisfy the 
requirements of this section. A person may not intervene or join in a 
pending civil action as a plaintiff unless the person independently 
satisfies the requirements of this section. If the requirements of this 
section are not satisfied by any such nonresident plaintiff, the court 
shall dismiss the claims of the plaintiff without prejudice to refiling 
in a court in any other State or jurisdiction.
    (d) Most Appropriate Forum.--If a person alleges that a substantial 
part of the acts or omissions giving rise to the personal injury claim 
occurred in more than State, the trial court shall determine which 
State is the most appropriate forum for the claim based on whether the 
private interests of the litigants and the public interest weigh in 
favor of the alternate forum.
            (1) Factors to be weighed in considering the private 
        interests include:
                    (A) the relative ease of access to sources of 
                proof;
                    (B) the availability of compulsory process for 
                attendance of unwilling and the cost of obtaining 
                attendance of willing witnesses;
                    (C) the distance from the site of the accident or 
                incident which gave rise to the litigation, including 
                the possibility of viewing of the premises, if 
                appropriate;
                    (D) the possibility of harassment of either party 
                in litigating in an inconvenient forum;
                    (E) the enforceability of any judgment obtained; 
                and
                    (F) any other practical problems which contribute 
                to the ease, expense, and expedition of the trial.
            (2) Factors affecting the public interest include:
                    (A) the administrative difficulties for the forum 
                courts;
                    (B) the desirability of having controversies 
                decided in the locale where people are most affected by 
                it;
                    (C) the burden of jury duty on citizens of a State 
                that has little relation to the litigation; and
                    (D) consideration of the State law which must 
                govern the case.
    (e) Dismissal and Tolling.--If the court determines that another 
forum would be the most appropriate forum for a claim, the court shall 
dismiss the claim. Any otherwise applicable statute of limitations 
shall be tolled beginning on the date the claim was filed and ending on 
the date the claim is dismissed under this subsection.
    (f) Definitions.--In this section:
            (1) The term ``personal injury claim''--
                    (A) means a civil action brought under State law by 
                any person to recover for a person's personal injury, 
                illness, disease, death, mental or emotional injury, 
                risk of disease, or other injury, or the costs of 
                medical monitoring or surveillance (to the extent such 
                claims are recognized under State law), including any 
                derivative action brought on behalf of any person on 
                whose injury or risk of injury the action is based by 
                any representative party, including a spouse, parent, 
                child, or other relative of such person, a guardian, or 
                an estate; and
                    (B) does not include a claim brought as a class 
                action.
            (2) The term ``person'' means any individual, corporation, 
        company, association, firm, partnership, society, joint stock 
        company, or any other entity, but not any governmental entity.
            (3) The term ``State'' includes the District of Columbia, 
        the Commonwealth of Puerto Rico, the United States Virgin 
        Islands, Guam, and any other territory or possession of the 
        United States.
    (g) No Impact on Suits Against Foreign Defendants.--Nothing in this 
section shall be construed to limit Federal or State court jurisdiction 
over any defendant that is a foreign state or a citizen or subject of a 
foreign state.
    (h) State Venue Requirements.--Nothing in this section shall 
preempt or supersede any State law relating to venue requirements that 
otherwise would not permit a person to bring, join, or intervene in 
personal injury claims in that State.
    (i) Applicability.--This section applies to any personal injury 
claim filed in State court on or after the date of the enactment of 
this Act.
                                 <all>