[Congressional Record Volume 143, Number 128 (Tuesday, September 23, 1997)]
[Senate]
[Page S9804]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             FURTHER EVIDENCE OF NEED FOR LEGAL REFORM NOW

 Mr. GORTON. A jury in New Orleans the other week issued a 
clarion call for legal reform. A monstrous judgment against CSX 
Transportation and four other companies illustrates once again the 
arbitrary and perverse nature of our current tort system.
  Mr. President, I rise today to bring to my colleagues' attention a 
$2.5 billion punitive damage award against CSX Transportation stemming 
from a 1987 chemical-car fire in the New Orleans neighborhood of 
Gentilly. Even in the context of our current broken legal system, this 
one is shocking. The jury awarded $2.5 billion, out of a total punitive 
damage award of $3.4 billion, against CSXT, Mr. President, despite the 
fact that Federal experts had determined that CSX was not at fault; 
despite the fact that the jury did not allocate any significant portion 
of the compensatory damages to CSXT; despite the fact that actual 
compensatory damages awarded to date in the case are only $2 million; 
and despite the fact that the accident resulted in no deaths, no 
serious injuries, and no significant property damage.
  Comparisons made in a New Orleans Times Picayune article put the 
total punitive damage award into perspective, warped as it is. Consider 
that the punitive damage award in this case is seven times the amount 
Union Carbide paid to settle a claim relating to a chemical leak in 
Bhopal, India, that killed 4,000 people and injured 300,000. Despite 
only minor property damage, this award is two-thirds of the punitive 
damage award against Exxon for the environmentally devastating spill 
that occurred in Alaska in 1989.
  Let me set out the facts of the case as I understand them from the 
press accounts. On September 9, 1987, a railroad tank car containing 
butadiene, a volatile compound used in making synthetic rubber, was 
located in a rail yard in New Orleans on tracks that belonged to CSXT. 
Due to a faulty gasket, the contents of the car leaked and the car 
caught fire. Local officials determined that the best approach was to 
let the fire burn itself out. To avoid harm to nearby residents, 
authorities ordered the evacuation of those living near the yard. Many 
people were inconvenienced, but although there are 8,000 people in the 
plaintiff class, only 2,300 people claim to have been located within 
the evacuation zone, and contemporary estimates of how many people were 
actually evacuated put the number at about 1,000.
  One year after the accident, the National Transportation Safety 
Board, the Federal agency that investigates transportation accidents, 
determined that a misaligned gasket and other factors, not involving 
CSXT, had caused the accident. In fact, other than providing the track 
on which the train car was placed, CSXT had no connection to the car. 
CSXT did not own or repair the tank car, and it did not transport the 
car.
  Significantly, even though the NTSB determined that CSTX had not 
caused the accident, the jury held CSXT 15 percent responsible for the 
$2 million on compensatory damages that have been awarded to 20 
plaintiffs at this time. The remaining plaintiffs will have to prove 
their damages in separate proceedings. Though it seems unfair that CSXT 
would be responsible for any compensatory damages if it was not at 
fault, it is unspeakably outrageous that CSXT would be assessed over 75 
percent of the punitive damages, and only 15 percent of the 
compensatory damages.
  How can it be that a Federal agency determines that a company has no 
responsibility for causing an accident and yet this huge verdict is 
awarded? The answer, unfortunately, is that our tort system is broken. 
The case in New Orleans is the latest, though perhaps most egregious, 
example of why we have to reform our civil justice system, to place 
some reasonable limit on punitive damage awards, to modify the laws 
regarding joint and several liability, and to provide disincentives for 
lawyers to go after the ``deep pockets,'' simply because they're there.
  CSXT is a big corporation, but that should not be reason to impose 
huge penalties on it, penalties that could affect its thousands of 
employees, thousands of middle-class stockholders who own shares in the 
company through their pension plans, and everyone who uses its vital 
transportation facilities. Until we undertake meaningful legal reform, 
we will continue to disadvantage businesses and consumers, stunt career 
opportunities, breed contempt for the law, and do injustice.

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