[Congressional Record Volume 151, Number 139 (Thursday, October 27, 2005)]
[House]
[Pages H9282-H9289]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




PROVIDING FOR CONSIDERATION OF H.R. 420, LAWSUIT ABUSE REDUCTION ACT OF 
                                  2005

  Mr. GINGREY. Madam Speaker, by direction of the Committee on Rules, I 
call up H. Res. 508 and ask for its immediate consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 508

       Resolved, That at any time after the adoption of this 
     resolution the Speaker may, pursuant to clause 2(b) of rule 
     XVIII, declare the House resolved into the Committee of the 
     Whole House on the state of the Union for consideration of 
     the bill (H.R. 420) to amend Rule 11 of the Federal Rules of 
     Civil Procedure to improve attorney accountability, and for 
     other purposes. The first reading of the bill shall be 
     dispensed with. All points of

[[Page H9283]]

     order against consideration of the bill are waived. General 
     debate shall be confined to the bill and shall not exceed one 
     hour equally divided and controlled by the chairman and 
     ranking minority member of the Committee on the Judiciary. 
     After general debate the bill shall be considered for 
     amendment under the five-minute rule. It shall be in order to 
     consider as an original bill for the purpose of amendment 
     under the five-minute rule the amendment in the nature of a 
     substitute recommended by the Committee on the Judiciary now 
     printed in the bill. The committee amendment in the nature of 
     a substitute shall be considered as read. Notwithstanding 
     clause 11 of rule XVIII, no amendment to the committee 
     amendment in the nature of a substitute shall be in order 
     except those printed in the report of the Committee on Rules 
     accompanying this resolution. Each such amendment may be 
     offered only in the order printed in the report, may be 
     offered only by a Member designated in the report, shall be 
     considered as read, shall be debatable for the time specified 
     in the report equally divided and controlled by the proponent 
     and an opponent, shall not be subject to amendment, and shall 
     not be subject to a demand for division of the question in 
     the House or in the Committee of the Whole. All points of 
     order against such amendments are waived. At the conclusion 
     of consideration of the bill for amendment the Committee 
     shall rise and report the bill to the House with such 
     amendments as may have been adopted. Any Member may demand a 
     separate vote in the House on any amendment adopted in the 
     Committee of the Whole to the bill or to the committee 
     amendment in the nature of a substitute. The previous 
     question shall be considered as ordered on the bill and 
     amendments thereto to final passage without intervening 
     motion except one motion to recommit with or without 
     instructions.

  The SPEAKER pro tempore. The gentleman from Georgia (Mr. Gingrey) is 
recognized for 1 hour.
  Mr. GINGREY. Madam Speaker, for the purpose of debate only, I yield 
the customary 30 minutes to the gentleman from Massachusetts (Mr. 
McGovern), pending which I yield myself such time as I may consume. 
During consideration of this resolution, all time yielded is for the 
purpose of debate only.
  Madam Speaker, House Resolution 508 is a structured rule. It provides 
for 1 hour of general debate, equally divided and controlled by the 
chairman and the ranking minority member of the Committee on the 
Judiciary. It waives all points of order against consideration of the 
bill, and it provides that the amendment in the nature of a substitute 
recommended by the Committee on the Judiciary now printed in the bill 
shall be considered as an original bill for the purpose of amendment 
and shall be considered as read.
  It makes in order only those amendments printed in the Rules 
Committee report accompanying the resolution. It provides that the 
amendments printed in the report may be offered only in the order 
printed, may be offered only by the Member designated in the report, 
shall be considered as read, shall be debatable for the time specified 
in the report, equally divided and controlled by the proponent and an 
opponent, shall not be subject to amendment, and shall not be subject 
to a demand for division of the question in the House or in the 
Committee of the Whole.
  This resolution waives all points of order against the amendments 
printed in the report, and it provides one motion to recommit, with or 
without instructions.
  Madam Speaker, I rise today in support of House Resolution 508 and 
the underlying legislation, H.R. 420, the Lawsuit Abuse Reduction Act 
of 2005.
  First, I want to commend the gentleman from Wisconsin (Mr. 
Sensenbrenner), the distinguished chairman of the Committee on the 
Judiciary, not just for the underlying bill but for a number of recent 
bills aimed at strengthening our legal system by protecting people's 
rights under the law and shielding them from frivolous proceedings. 
Additionally, I want to thank the gentleman from Texas (Mr. Smith), the 
chairman of the Subcommittee on the Courts, the Internet, and 
Intellectual Property, for sponsoring H.R. 420.
  Madam Speaker, over the past couple of weeks, this House has taken 
several important steps to reform our legal system, to relieve our 
overburdened court dockets and drastically reduce the number of costly 
frivolous claims against innocent and legitimate businesses.
  On October 24, we passed and sent to the President's desk S. 397, the 
Lawful Commerce in Arms Act of 2005, by a vote of 283 to 144 in the 
House. I might add that in the spirit of bipartisanship, 59 Democrats 
and one Independent joined 223 Republicans in passing this landmark 
legislation that refocuses liability for gun violence on the actual 
criminal, the person who pulled the trigger.
  Additionally in this House, 226 Republicans, along with 80 Democrats, 
passed H.R. 554, the Personal Responsibility in Food Consumption Act of 
2005. This bill also reaffirms the need for individuals to take 
responsibility for their own actions and not expect someone else to 
foot the bill for the adverse health consequences of their own 
gluttony.
  Today, Madam Speaker, we have another prime opportunity to pass 
meaningful legislation to strengthen our court system even further and 
to protect the falsely accused.
  The Lawsuit Abuse Reduction Act of 2005 will go a long way to curb 
the actions of individuals who would seek to abuse our courts by gaming 
the judicial system. Last week, there were probably millions of people 
across this country who tuned in, ticket in hand, to see if they had 
won a $340 million Powerball jackpot. Unfortunately, there are also 
people who look to the courts, legal briefs in hand, as if it were the 
Powerball lottery.
  However, Madam Speaker, it is the American people and small 
businesses that pay the ultimate price for frivolous lawsuits and this 
type of jackpot justice. They pay for it through higher prices for 
goods and services, they pay for it through diminished quality of 
products, they pay for it through loss of economic freedom, and they 
pay for it through a clogged court system that has been turned into an 
ATM for junk lawsuits. In fact, the current tort system is estimated to 
cost American people well over $200 billion per year.
  Clearly, the Lawsuit Abuse Reduction Act of 2005 is a bill that is 
sorely overdue, sorely needed and, I might add, was approved by this 
House in the last Congress by a vote of 229 to 174.
  With respect to the underlying bill, it would amend Rule 11 of the 
Federal Rules of Civil Procedure by restoring the mandatory sanctions 
for the filing of frivolous lawsuits. This bill would require that 
courts impose an appropriate penalty on attorneys, law firms, or 
parties who continue to file frivolous lawsuits. Also this bill would 
eliminate the ``free pass'' provision that allows attorneys to avoid 
sanctions if they withdraw their frivolous claim after a motion for 
sanctions has been filed.
  Madam Speaker, H.R. 420 also would prevent forum shopping by 
requiring that personal injury cases only be brought in those 
jurisdictions either where the plaintiff, the defendant or a related 
business resides, or where the alleged injury or surrounding 
circumstances occurred.
  This act would also institute a three-strikes-and-you're-out sanction 
that would suspend an attorney from practicing in Federal court if a 
Federal judge determines the lawyer has violated Rule 11 on three or 
more occasions.
  H.R. 420 clearly emphasizes that personal responsibility is not just 
some catch phrase that applies only to some people, such as a fast-food 
connoisseur, a firearms owner, a consumer or, indeed, a doctor. 
Personal responsibility and professional accountability should be the 
rule for those in the legal field, too, and that is why this House 
should pass this bill.
  In closing, Madam Speaker, I would just emphasize that House 
Resolution 508 is a straightforward rule and H.R. 420 is a 
straightforward bill. Simply put, it just makes sense to stop and 
punish the willful abuse of our legal system by the slash-and-burn 
tactics of frivolous lawsuits.
  As always, I look forward to the consideration of this rule, and I 
ask my colleagues to support it and the underlying bill.
  Madam Speaker, I reserve the balance of my time.
  Mr. McGOVERN. Madam Speaker, I want to thank the gentleman from 
Georgia (Mr. Gingrey) for yielding me the customary 30 minutes, and I 
yield myself such time as I may consume.
  (Mr. McGOVERN asked and was given permission to revise and extend his 
remarks.)
  Mr. McGOVERN. Madam Speaker, here we go again. Whenever the 
Republican leadership appears to be floundering or simply needs some 
legislative

[[Page H9284]]

filler, they turn to the Judiciary Committee for some kind of anti-
lawyer, anti-lawsuit bill.
  We recently considered a bill to ban lawsuits against people who want 
to sue fast food companies, even though these cases are nonexistent. 
Now we are here considering another bill that will pass the House and 
go nowhere in the Senate.
  The fact is that the Republican leadership has run out of meaningful 
legislation to consider. They have run out of ideas. So here we are 
once again considering another bill that attacks America's judicial 
system and takes away rights from our fellow citizens.
  Time after time, the Republican leadership refuses to bring necessary 
legislation to the floor. Where, Madam Speaker, is the legislation 
combating poverty or ending hunger or increasing access to affordable 
and comprehensive health care? Where are their priorities? There are 45 
million Americans who have no health insurance in this country. Where 
is the increase in the minimum wage? Where is the legislation to lower 
gas and oil prices?
  It was comical to see the Republican leadership gather at a press 
conference the other day in reaction to the news that oil companies are 
making record profits. And what was their response? They very nicely 
asked the oil companies to do more. Why should the oil companies do 
more when they have passed legislation to give oil companies more tax 
breaks and more oil subsidies?
  Where, Madam Speaker, is the oversight into the Iraq war? Over 2,000 
Americans have lost their lives in Iraq, and all we get from this 
leadership and all we get from this White House is ``stay the course.'' 
Well, stay the course is not a policy; it is a sound bite. We owe our 
young men and women more than just a sound bite.
  Where is the genuinely independent 9/11-style commission to 
investigate the botched response to Hurricane Katrina and to make 
recommendations on how to prevent such another tragedy in the future? 
Where is the fully constituted, functioning Ethics Committee to look 
into the numerous ethics charges that are mounting in this body?
  No, here we are dealing with legislation that we dealt with last year 
that is going nowhere.
  The fact is, the Republican leadership does not care much about these 
issues, and I know they are out of step with the American people on 
these issues. So, instead, they bring us the Lawsuit Abuse Reduction 
Act once again. This is like watching a bad TV rerun. It was not good 
the first time; it is even worse the second time.

                              {time}  1045

  Remember, we considered this bill last year, and just like last year, 
it will pass this Republican-controlled Congress. They will do their 
press releases, they will send it over to the Senate, and it will go 
nowhere.
  Later today we will hear from members of the House Judiciary 
Committee who have particular subject expertise on the specifics of 
this legislation. I will leave it to these Members to explain the 
intricacies of the Federal Code and the Rules of Civil Procedure and 
how Rule 11 fits in. I would like for a few minutes, however, to talk 
about the continued abuse of power that the Republican majority takes 
to a new level today.
  Under this rule and under this bill, Republican fund-raisers are 
rewarded, while the majority party continues its unabashed assault on 
the judicial branch of this Nation. Do not just take my word for it, 
Madam Speaker. One of the broadest arrays of groups that I have ever 
seen has come together to oppose this misguided, short-sighted, mean-
spirited legislation. These groups include, but are certainly not 
limited to, the NAACP, the Legal Defense Fund, the American Bar 
Association, the National Conference of State Legislatures, the 
National Women's Law Center, and the Consumers Union.
  The one that stands out the most, however, is the opposition from the 
Judicial Conference of the United States. Now, what is that? What is 
this conference that opposes what my Republican friends will describe 
as a critically important piece of legislation?
  The Judicial Conference was created by this very Congress in 1922. 
Their congressionally mandated mission is to be the principal 
policymaking body concerned with the administration of the United 
States courts. The presiding officer of this organization is none other 
than the Chief Justice of the Supreme Court. You know what the Judicial 
Conference has to say about this legislation? In a three-page letter to 
Chairman Sensenbrenner, in short, they say it is unnecessary and it is 
harmful. If they were less judicious in their choice of words, they 
would say what I say: It stinks.
  But what they say, Madam Speaker, this group representing the Federal 
judges of this country, is that this legislation is fatally flawed. 
They say that Rule 11 of the Federal Rules of Civil Procedure, what the 
underlying legislation aims to fix, is working better today than ever 
before. In fact, in their letter to the Judiciary Committee chairman, 
they say that Federal district judges are united in their opposition to 
any legislation which seeks to amend rule 11. They specifically urge 
Congress to reject this legislation.
  Now, Madam Speaker, let us think this through for just a second, 
shall we? The organization representing President-appointed, Senate-
confirmed judges thinks this legislation is unwise. Why do we think we 
know better than our Federal judges how to operate the Federal 
judiciary? Frankly, I would laugh if I did not think that the majority 
was so sincere in their attempts to undermine the constitutional rights 
of every single American. Shame on you. Shame on all of you for trying 
to eviscerate the Constitution, all for a few extra campaign dollars, 
because that is what this is about.
  The underlying legislation is not sound public policy, plain and 
simple. On the contrary, it is outright political grandstanding. So let 
us be honest and let us call this bill and this debate what they really 
are: legislative abuse and a political charade.
  The majority's reckless disregard for judicial integrity mocks our 
Constitution's separation of powers doctrine, and I implore my 
colleagues to reject this rule and the underlying legislation.
  Madam Speaker, I reserve the balance of my time.
  Mr. GINGREY. Madam Speaker, in response to some of the comments that 
were made, I just want to hold up this document that lists over 300 
groups in support of LARA, the Lawsuit Abuse Reduction Act of 2005, and 
I will include them in the Record.
  I would like to also point out that the Federal Judicial Center was 
in opposition to class action reform, which we passed in the previous 
Congress and in the 108th by a vote in this body of 279 to 149.

  Groups Supporting H.R. 420--The Lawsuit Abuse Reduction Act of 2005

       Advanced Medical Technology Association.
       Air Conditioning Contractors of America.
       Alabama Civil Justice Reform Committee.
       Alabama Restaurant Association.
       Alabama Trucking Association, Inc.
       Alaska Cabaret, Hotel, Restaurant and Retailers 
     Association.
       Alliance of Automotive Service Providers of Minnesota.
       Alliance of Automotive Service Providers of Pennsylvania.
       America Chamber of Commerce (NV).
       American Apparel and Footwear Association.
       American Automotive Leasing Association.
       American Bakers Association.
       American Boiler Manufacturers Association.
       American Business Conference.
       American Chemistry Council.
       American Council of Engineering Companies.
       American Health Care Association.
       American Home Furnishing Alliance.
       American Insurance Association.
       American International Automobile Dealers Association.
       American Legislative Exchange Council.
       American Machine Tool Distributors Association.
       American Petroleum Institute.
       American Rental Association.
       American Road & Transportation Builders Association.
       American Supply Association.
       American Trucking Associations.
       American Tort Reform Association.
       American Veterinary Distributors Association.
       American Wholesale Marketers Association.
       Antelope Valley Chamber of Commerce (CA).
       Ardmore Chamber of Commerce (OK).
       Arkansas Chapter, National Electrical Contractors 
     Association.
       Arkansas Hospitality Association.
       Arizona Chapter, National Electrical Contractors 
     Association.

[[Page H9285]]

       Arizona Restaurant & Hospitality Association.
       Associated Builders & Contractors.
       Associated General Contractors of America.
       Associated Equipment Distributors.
       ASFE--Associated Soil & Foundation Engineers.
       Associated Wire Rope Fabricators.
       Association for High Technology Distribution.
       Association of Equipment Manufacturers.
       Association of Pool & Spa Professionals.
       AMT--The Association for Manufacturing Technology.
       Automotive Aftermarket Industry Association.
       Automotive Parts Remanufacturers Association.
       Automotive Parts & Service Association of Illinois.
       Aviation Distributors & Manufacturers Association.
       Bay Area Citizens Against Lawsuit Abuse.
       Bearing Specialists Association.
       Brunswick-Golden Isles Chamber of Commerce (GA).
       Business Council of New York State, Inc.
       Business Roundtable.
       California Central Coast Chapter, National Electrical 
     Contractors Association.
       California Restaurant Association.
       California/Nevada Automotive Wholesalers Association.
       Central California Citizens Against Lawsuit Abuse.
       Central Illinois, National Electrical Contractors 
     Association.
       Chamber of Business and Industry of Centre County (PA).
       Chamber of Commerce for Anderson & Madison County (IN).
       Chamber of Commerce of the Mid-Ohio Valley (WV).
       Citizens Against Lawsuit Abuse of Central Texas.
       Citizens for Civil Justice Reform.
       City of Chicago, National Electrical Contractors 
     Association.
       Civil Justice Association of California.
       Cleaning Equipment Trade Association.
       Cleveland Chapter, National Electrical Contractors 
     Association.
       Coalition for Uniform Product Liability Law.
       Colorado Civil Justice League.
       Colorado Motor Carriers Association.
       Colorado Restaurant Association.
       Connecticut Restaurant Association.
       Construction Industry Round Table.
       Copper & Brass Service Center Association.
       Council of Insurance Agents and Brokers.
       Crawfordsville/Montgomery Chamber of Commerce (IN).
       Dayton Area Chamber of Commerce (OH).
       Delaware Motor Transport Association.
       Delaware Restaurant Association.
       East Texans Against Lawsuit Abuse.
       The Employers Association.
       Electrical Manpower Development Trust.
       Equipment Leasing Association.
       Florida Chamber of Commerce.
       Florida Restaurant Association.
       Food Industry Suppliers Association.
       Gas Appliance Manufacturers Association.
       Gases and Welding Distributors Association.
       General Aviation Manufacturers Association.
       Georgia Association of Petroleum Retailers, Inc.
       Georgia Industry Association.
       Georgia Restaurant Association.
       Great Lakes Petroleum Retailers & Allied Trades 
     Association.
       Georgia Motor Trucking Association.
       Hawaii Restaurant Association.
       Hawaii Transportation Association.
       Health Industry Distributors Association.
       Healthcare Distribution Management Association.
       Heating, Air Conditioning & Refrigeration Distributors 
     International Association.
       Hobbs Chamber of Commerce (NM).
       Hospitality Association of South Carolina.
       Hospitality Minnesota--Minnesota's Restaurant, Hotel & 
     Lodging and Resort & Campground Associations.
       Hudson Valley Chapter, National Electrical Contractors 
     Association (NY).
       Humble Area Chamber of Commerce (TX).
       Idaho Lodging and Restaurant Association.
       Illinois Chapter, National Electrical Contractors 
     Association.
       Illinois Civil Justice League.
       Illinois Lawsuit Abuse Watch.
       Illinois Quad City Chamber.
       Illinois Restaurant Association.
       Independent Electrical Contractors.
       Independent Insurance Agents & Brokers of America, Inc.
       Independent Sealing Distributors.
       Industrial Compressor Distributor Association.
       Industrial Supply Association.
       International Association of Plastics Distributors.
       International Foodservice Distributors Association.
       International Franchise Association.
       International Furniture Suppliers Association.
       International Housewares Association.
       International Safety Equipment Association.
       International Sanitary Supply Association.
       International Sign Association.
       International Sleep Products Association.
       International Truck Parts Association.
       Iowa Hospitality Association.
       Iowa Motor Truck Association.
       Jackson Area Manufacturers Association.
       Kansas Chamber of Commerce.
       Kansas City Chapter, National Electrical Contractors 
     Association.
       Kansas Restaurant and Hospitality Association.
       Kentucky Motor Transport Association.
       Kentucky Restaurant Association.
       Kern County Chapter, National Electrical Contractors 
     Association (CA).
       Kingman Area Chamber of Commerce (AZ).
       Lakewood Chamber of Commerce (WA).
       Latrobe Area Chamber of Commerce (PA).
       Lawn and Garden Marketing and Distribution Association.
       Lebanon Valley Chamber of Commerce (PA).
       Los Angeles Citizens Against Lawsuit Abuse.
       Los Angeles Fastener Association.
       Louisiana Motor Transport Association.
       Louisiana Restaurant Association.
       Maine Liability Crisis Alliance.
       Maine Restaurant Association.
       Manufactured Housing Institute.
       Manufacturers' Association of Northwest Pennsylvania.
       Marion Area Chamber of Commerce (IL).
       Maryland Business for Responsive Government.
       Maryland Chapter, National Electrical Contractors 
     Association.
       Massachusetts Restaurant Association.
       Material Handling Equipment Distributors Association.
       Mechanical Contractors Association of America.
       Memphis Chapter, National Electrical Contractors 
     Association.
       Metals Service Center Institute.
       Mason Contractors Association of America.
       Michigan Chamber of Commerce.
       Michigan Lawsuit Abuse Watch.
       Michigan Restaurant Association.
       Minnesota Trucking Association.
       Mississippi Hospitality and Restaurant Association.
       Mississippi Manufacturers Association.
       Mississippi Trucking Association.
       Mississippians for Economic Progress.
       Missouri Motor Carriers Association.
       Missouri Restaurant Association.
       Montana Chamber of Commerce/Montana Liability Coalition.
       Montana Motor Carriers Association.
       Montana Restaurant Association.
       Motor & Equipment Manufacturers Association.
       Motorcycle Industry Council.
       National Association of Chemical Distributors.
       National Association of Convenience Stores.
       National Association of Electrical Distributors.
       National Association of Home Builders.
       National Association of Manufacturers.
       National Association of Mutual Insurance Companies.
       National Association of Sign Supply Distributors.
       National Association of Wholesaler-Distributors.
       National Concrete Masonry Association.
       National Council of Chain Restaurants of the National 
     Retail Federation.
       National Electrical Contractors Association.
       National Federation of Independent Business.
       National Lumber & Building Materials Dealers Association.
       National Marine Distributors Association.
       National Paint & Coatings Association.
       National Pest Management Association.
       National Propane Gas Association.
       National Restaurant Association.
       NRF--The National Retail Federation.
       National Roofing Contractors Association.
       National School Supply & Equipment Association.
       National Shooting Sports Foundation.
       NAHAD--The Association for Hose & Accessories Distributors
       NPES--The Association for Suppliers of Printing, Publishing 
     and Converting Technologies.
       National Small Business Association.
       Nebraska Restaurant Association.
       Nebraska Trucking Association.
       Nevada State Medical Association.
       New Hampshire Lodging and Restaurant Association.
       New Jersey Automobile Wholesalers Association.
       New Jersey Business & Industry.
       New Jersey Motor Truck Association.
       New Jersey Restaurant Association.
       New Mexico Alliance for Legal Reform.
       New Mexico Chapter, National Electrical Contractors 
     Association.
       New Mexico Restaurant Association.
       Nevada Restaurant Association.
       New York State Automotive Aftermarket Association.
       New York State Motor Truck Association.
       New York State Restaurant Association.
       North American Horticultural Supply Association.
       North Carolina Citizens for Business and Industry.
       North Carolina Restaurant Association.
       North Carolina Trucking Association.
       North Dakota State Hospitality Association.
       North Florida Chapter, National Electrical Contractors 
     Association.
       North Louisiana Chapter, National Electrical Contractors 
     Association.
       North Texas Chapter, National Electrical Contractors 
     Association.

[[Page H9286]]

       Northeastern Illinois Chapter, National Electrical 
     Contractors Association.
       Northern California Citizens Against Lawsuit Abuse.
       Northern Illinois Chapter, National Electrical Contractors 
     Association.
       Northern New York Chapter, National Electrical Contractors 
     Association.
       Northern Rhode Island Chamber of Commerce.
       Office Products Wholesalers Association.
       Ohio Association of Wholesaler-Distributors.
       Ohio Manufacturers Association.
       Ohio Restaurant Association.
       Ohio Trucking Association.
       Oklahoma Restaurant Association.
       Orange Chamber of Commerce (CA).
       Orange County Citizens Against Lawsuit Abuse.
       Oregon Restaurant Association.
       Outdoor Power Equipment & Engine Service Association.
       Outdoor Power Equipment Institute.
       Outdoor Power Equipment Aftermarket Association.
       Pacific Printing & Imaging Association (AK, HI, ID, MT, OR, 
     WA).
       Packaging Machinery Manufacturers Institute.
       Painting & Decorating Contractors of America.
       Penn-Ohio Chapter, National Electrical Contractors 
     Association.
       Pennsylvania Health Care Association.
       Pennsylvania Restaurant Association.
       Paris Area Chamber of Commerce & Tourism (IL).
       Pennsylvania Automotive Wholesalers Association.
       Pet Industry Distributors Association.
       Petroleum Equipment Institute.
       Petroleum Marketers Association of America.
       Petroleum Retailers & Auto Repair Association.
       Plumbing-Heating-Cooling Contractors Association.
       Post Card and Souvenir Distributors Association.
       Power Transmission Distributors Association.
       Printing & Graphic Communications Association.
       Printing & Imaging Association of Mid-America (KS, MO, OK, 
     TX).
       Printing & Imaging Association, Mountain States.
       Printing Association of Florida.
       Printing Industries Association of San Diego.
       Printing Industries of Michigan.
       Printing Industry Association of the South (AL, AR, KY, LA, 
     MS, TN, WV).
       Printing Industries of America.
       Printing Industries of Illinois/Indiana Association.
       Printing Industries of New England (ME, NH, VT, MA, RI).
       Production Engine Remanufacturers Association.
       Property Casualty Insurers Association of America.
       Red River Valley Chapter, National Electrical Contractors 
     Association (TX).
       Retail Industry Leaders Association.
       Restaurant and Hospitality Association of Indiana.
       Restaurant Association of Maryland, Inc.
       Restaurant Association of Metro Washington, Inc.
       Rhode Island Hospitality and Tourism Association.
       Richmond/Spring Grave Chamber (IL).
       Rio Grande Valley Partnership.
       Rubber Manufacturers Association.
       Safety Equipment Distributors Association, Inc.
       Saguaro Chapter, National Electrical Contractors 
     Association (AZ).
       St. Paul Chapter, National Electrical Contractors 
     Association (MN).
       San Diego Chapter, National Electrical Contractors 
     Association.
       San Diego County Citizens Against Lawsuit Abuse.
       San Diego Employers Association.
       Scaffold Industry Association.
       Security Hardware Distributors Association.
       SSDA-AT--Service Station Dealers Of America/ National 
     Coalition Petroleum Retailers and Allied Trades.
       Silicon Valley Citizens Against Lawsuit Abuse.
       SBE Council--Small Business and Entrepreneurship Council.
       Small Business Legislative Council.
       SMC Business Councils.
       Snack Food Association.
       South Carolina Trucking Association.
       South Carolina Civil Justice Coalition.
       South Dakota Retailers Association.
       Southern Nevada Chapter, National Electrical Contractors 
     Association.
       Specialty Equipment Market Association.
       Society of American Florists.
       The State Chamber of Oklahoma.
       Steel Tank Institute.
       Tarpon Springs Chamber of Commerce (FL).
       Tennessee Chamber of Commerce & Industry.
       Tennessee Restaurant Association.
       Texas Association of Business.
       Texas Civil Justice League.
       Texas Restaurant Association.
       Textile Care Allied Trades Association.
       Tire Industry Association.
       Truck Renting and Leasing Association.
       U.S. Chamber of Commerce.
       U.S. Chamber Institute for Legal Reform.
       Utah Restaurant Association.
       Valve Manufacturers Association.
       Vermont Lodging and Restaurant Association.
       Virginia Hospitality and Travel Association.
       Virginia Trucking Association.
       Washington State Liability Reform Coalition.
       Washington Restaurant Association.
       Waste Equipment Technology Association.
       West Virginia Chamber of Commerce.
       West Virginia Hospitality and Travel Association.
       West Virginia Motor Truck Association.
       Western Association of Fastener Distributors.
       Western New York Chapter, National Electrical Contractors 
     Association.
       Western Pennsylvania Chapter, National Electrical 
     Contractors Association.
       Weston Area Chamber of Commerce (FL).
       Wisconsin Manufacturers & Commerce.
       Wisconsin Motor Carriers Association.
       Wisconsin Restaurant Association.
       Wood Machinery Manufacturers of America.
       Woodworking Machinery Industry Association.
       Wyoming Lodging & Restaurant Association.
       Wyoming Trucking Association, Inc.

  Madam Speaker, I reserve the balance of my time.
  Mr. McGOVERN. Madam Speaker, if I could inquire from the gentleman 
how many more speakers he has, because I am the last speaker on my 
side.
  Mr. GINGREY. To the gentleman from Massachusetts, we do not actually 
have any additional speakers at this time, so right now I am reserving 
the balance of my time for the purpose of closing, unless another 
speaker comes.
  Mr. McGOVERN. Madam Speaker, I would like to enter into the Record as 
well another letter signed by a number of groups urging a vote against 
H.R. 420.
  I would also like to include a letter that was sent to every Member 
of Congress by Michael S. Greco, the President of the American Bar 
Association, opposing this legislation.
  I would also like to insert in the Record the text of the letter that 
I mentioned in my opening speech from the Judicial Conference of the 
United States which very strongly opposes this legislation.
                                                 October 25, 2005.
       Dear Representative: We urge you to oppose H.R. 420, a bill 
     that would restore the discriminatory impact of the old 
     version of Rule 11 of the Federal Rules of Civil Procedure, 
     trample on states' rights to run their own courts, and 
     increase the extent and expense of litigation rather than 
     reduce it.
       H.R. 420 seeks to roll back Rule 11 of the Federal Rules of 
     Civil Procedure to an earlier 1983 version of the rule, which 
     would undermine carefully crafted standards that were enacted 
     in 1993. Those changes expanded responsibilities of 
     litigants, while at the same time providing greater 
     constraints and flexibility in dealing with violations of the 
     rule. The current rule requires litigants to ``stop-and-
     think'' before making legal or factual contentions. It also, 
     however, emphasizes the duty of candor by subjecting 
     litigants to potential sanctions for insisting upon a 
     position after it is no longer tenable, and by generally 
     providing protection against sanctions if they withdraw or 
     correct contentions after a potential violation is called to 
     their attention.
       There is no evidence that the current Rule 11 is not 
     working. In fact, Department of Justice statistics show that 
     the number of lawsuits is declining in both federal and state 
     courts. The end result of H.R. 420 would be a shift of the 
     function of Rule 11 from deterring frivolous litigation to 
     increasing litigation by those who have the resources and the 
     time to litigate against opposing counsel. History shows that 
     mandatory Rule 11 sanctions imposed in 1983, and to which 
     H.R. 420 would have us return, were used disproportionately 
     against plaintiffs' (particularly civil rights) attorneys and 
     those attempting to extend the law in support of unpopular 
     causes. More than a decade ago, civil rights organizations--
     including some of the undersigned organizations--worked to 
     amend Rule 11 because the old rule unfairly discouraged 
     meritorious civil rights claims. H.R. 420 seeks to force 
     litigants to operate under the terms that we fear, like the 
     former rule we worked so hard to amend, will be used to 
     punish and deter valid claims of discrimination.
       Nationwide surveys about the former rule found that motions 
     for sanctions were most frequently sought and granted in 
     civil rights cases. Expressing his concerns about the former 
     Rule 11, the Honorable Robert L. Carter, United States 
     District Court Judge for the Southern District of New York, 
     noted, ``I have no doubt that the Supreme Court's opportunity 
     to pronounce separate schools inherently unequal [in Brown v. 
     Board of Education] would have been delayed for a decade had 
     my colleagues and I been required, upon pain of potential 
     sanctions, to plead our legal theory explicitly from the 
     start.'' The language of H.R. 420 purporting

[[Page H9287]]

     to protect civil rights claims provides insufficient 
     protection for victims of discrimination because the more 
     severe rules outlined in H.R. 420 can still be applied in 
     civil rights. Had supporters of the bill wanted to 
     effectively protect those who seek justice under our civil 
     rights laws, they could have exempted those claims from the 
     scope of the bill.
       Moreover, H.R. 420 not only changes the rules for federal 
     courts, it is unprecedented in that its reach extends to 
     state court cases. Section 3 of the bill provides, upon 
     motion, the court is required to assess the costs of the 
     action ``to the interstate economy.'' If the court determines 
     that the state court action ``affects interstate commerce,'' 
     Rule 11 of the Federal Rules of Civil Procedure ``shall apply 
     to such action.'' Imagining the proceedings necessary to 
     determine whether a particular state court action ``affects 
     interstate commerce'' is mind-boggling. This provision will 
     certainly spawn satellite litigation. Moreover, the total 
     disregard for federalism is astounding.
       Finally, the vast majority of the federal judiciary opposes 
     the changes contained in H.R. 420. The Judicial Conference of 
     the United States, headed by the late Chief Justice 
     Rehnquist, clearly stated in a letter to Chairman 
     Sensenbrenner that ``the proposed changes to Rule 11 will not 
     help deter litigation abuses, but will increase satellite 
     litigation, costs, and delays.'' The letter also notes there 
     is ``a remarkable consensus'' among Federal district court 
     judges in opposition to changing the rule.
       If you have any questions or need more information, please 
     contact Pamela Gilbert, Cuneo Gilbert & LaDuca, LLP, 
     representing the Center for Justice & Democracy, 
     202.587.5064; Sandy Brantley, Legislative Counsel, Alliance 
     for Justice, 202.822.6070; or Jillian Aldebron, Civil Justice 
     Counsel, Public Citizen's Congress Watch, 202.454.5135.
           Sincerely,
       Alliance for Justice.
       Center for Justice & Democracy.
       Citizens for a Safer Minnesota.
       Consumer Federation of America.
       District of Columbia Million Mom March.
       Legal Community Against Violence.
       Maine Citizens Against Handgun Violence.
       National Association of Consumer Advocates.
       New Yorkers Against Gun Violence.
       Public Citizen.
       USAction.
       Violence Policy Center.
       Virginians Against Handgun Violence.
                                  ____



                                     American Bar Association,

                                    Chicago, IL, October 10, 2005.
       Dear Representative: I write regarding H.R. 420, the 
     ``Lawsuit Abuse Reduction Act.'' The American Bar Association 
     strongly opposes this legislation and respectfully urges you 
     to vote ``No'' when it is brought to the floor of the House 
     of Representatives in the near future.
       Without any demonstrated problem with the enforcement or 
     operation of Rule 11, H.R. 420 would (1) impose mandatory 
     sanctions for any violation of Rule 11 of the Federal Rules 
     of Civil Procedure and remove its current ``safe harbor'' 
     provisions; (2) enforce a mandatory suspension from 
     practicing law of an attorney who has violated Rule 11 three 
     times; (3) impose federal mandatory Rule 11 sanctions upon 
     any civil state court claim that materially affects 
     interstate commerce; and (4) impose specific venue 
     designation rules upon any personal injury claim filed in any 
     state or federal court.
       As a threshold matter, the ABA strongly opposes the 
     legislation because these amendments to the Federal Rules of 
     Civil Procedure are being proposed without utilizing the 
     process set forth in the Rules Enabling Act. This departure 
     from the procedure of the Rules Enabling Act is also being 
     proposed without any demonstrated problem with the operation 
     of the Rules Enabling Act. The ABA fully supports the Rules 
     Enabling Act process, which is based on three fundamental 
     concepts: (1) the essential and central role of the judiciary 
     in initiating judicial rulemaking; (2) the use of procedures 
     that permit full public participation, including 
     participation by members of the legal profession; and (3) 
     provision for a Congressional review period. We view the 
     proposed rules changes to the Federal Rules in H.R. 420 as an 
     unwise retreat from the balanced and inclusive process 
     established by Congress when it adopted the Rules Enabling 
     Act.
       In 28 U.S.C. Sec. Sec. 2072-74, Congress prescribed the 
     appropriate procedure for the formulation and adoption of 
     rules of evidence, practice and procedure for the federal 
     courts. This well-settled, congressionally specified 
     procedure contemplates that evidentiary and procedural rules 
     will in the first instance be considered and drafted by 
     committees of the United States Judicial Conference, will 
     thereafter be subject to thorough public comment and 
     reconsideration, and will then be submitted to the United 
     States Supreme Court for consideration and promulgation. 
     Finally and most importantly, the proposed rules resulting 
     from the inclusion of all of the stakeholders, is transmitted 
     to Congress, which retains the ultimate power to veto any 
     rule before it takes effect.
       This time-proven process proceeds from separation-of-powers 
     concerns and is driven by the practical recognition that, 
     among other things:
       (1) rules of evidence and procedure are inherently a matter 
     of intimate concern to the judiciary, which must apply them 
     on a daily basis;
       (2) each rule forms just one part of a complicated, 
     interlocking whole, rendering due deliberation and public 
     comment essential to avoid unintended consequences; and
       (3) the Judicial Conference is in a unique position to 
     draft rules with care in a setting isolated from pressures 
     that may interfere with painstaking consideration and due 
     deliberation.
       We do not question Congressional power to regulate the 
     practice and procedure of federal courts. Congress exercised 
     this power by delegating its rulemaking authority to the 
     judiciary through the enactment of the Rules Enabling Act, 
     while retaining the authority to review and amend rules prior 
     to their taking effect. We do, however, question the wisdom 
     of circumventing the Rules Enabling Act, as H.R. 420 would 
     do. The fact that the proposed changes to the Rules are 
     flawed should give pause to those who are asked to support 
     the circumvention of the process of the Rules Enabling Act. 
     Not following the processes set forth in the Rules Enabling 
     Act would frustrate the purpose of the act and potentially 
     harm the effective functioning of the judicial system.
       The ABA supports the current version of Rule 11 because it 
     has proven to be an effective means of discouraging dilatory 
     motions practice and frivolous claims and defenses. There has 
     been no demonstrated problem with the enforcement or 
     operation of Rule 11. The ABA opposes the provisions in H.R 
     420 to enforce a mandatory suspension of an attorney for Rule 
     11 violations. The filing of frivolous claims and defenses is 
     an important issue that deserves attention. It is appropriate 
     and right for courts to have the ability to sanction 
     attorneys for abusing the legal system by filing claims meant 
     to harass or intimidate litigants. It is, however, important 
     to remember that Rule 11 violations can be levied even when, 
     in hindsight, there may have been a legitimate claim, 
     especially for civil rights cases or environmental 
     litigation. Attorneys practicing in these areas may be 
     subject to more Rule 11 sanctions than attorneys who handle 
     other types of cases.
       A system that provides for mandatory suspension of 
     attorneys with three Rule 11 violations would have an 
     extremely chilling effect on the justice system and could 
     disproportionately impact attorneys who practice in 
     particular areas, such as civil rights or environmental law. 
     This type of mandatory suspension is even more damaging when 
     taken in combination with efforts to require mandatory 
     sanctions for Rule 11 violations, which cannot be appealed 
     until after a judgment is rendered in a case.
       Equally important, the ABA strongly opposes enactment of 
     H.R. 420 because Congress should not dictate venue rules for 
     state courts. State rules relating to venue and jurisdiction 
     should be developed at the state level and supported by 
     extensive study, vetted publicly, and made subject to comment 
     by the legal profession. To do otherwise would violate our 
     long-established principles of federalism. It should remain 
     solely within the purview of the individual states to 
     establish local rules for procedures, either through their 
     state legislatures or through a grant of rulemaking authority 
     to their state judiciaries.
       The imposition of Rule 11 mandatory sanctions upon the 
     individual state courts would also violate our time-honored 
     principles of federalism. Earlier this year, the Conference 
     of Chief Justices adopted a resolution in opposition to 
     federal usurpation of state court authority as guaranteed by 
     the United States Constitution. This resolution ``strongly 
     opposed'' the enactment of any federal legislation that would 
     ``drastically change the traditional state role in 
     determining ethics, jurisdiction and venue rules in state 
     litigation.'' The determination of the states to establish 
     and operate their judicial systems in accordance with 
     principles important to each state is entitled to respectful 
     deference from the federal government. Great deference should 
     also be given to the views of these state court leaders.
       For these compelling reasons the ABA strongly opposes the 
     enactment of H.R. 420. We respectfully urge you to vote 
     ``No'' on this legislation.
           Sincerely,
                                                 Michael S. Greco,
     President.
                                  ____

                                               Judicial Conference


                                         of the United States,

                                     Washington, DC, May 17, 2005.
     Hon. F. James Sensenbrenner, Jr.,
     Chairman, Committee on the Judiciary, House of 
         Representatives, Washington, DC.
       Dear Mr. Chairman: I am pleased to provide you with a copy 
     of the Federal Judicial Center's Report of a Survey of United 
     States District Judges' Experiences and Views Concerning Rule 
     11, Federal Rules of Civil Procedure. The report was prepared 
     at the request of the Judicial Conference's Advisory 
     Committee on Civil Rules to provide information as part of 
     the Advisory Committee's study of proposals introduced in 
     Congress to amend Rule 11. The report makes it clear that the 
     vast majority of federal district judges believe that the 
     proposed changes to Rule 11 will not help deter litigation 
     abuses, but will increase satellite litigation, costs, and 
     delays.
       Since 1995, legislation has regularly been introduced that 
     would reinstate a mandatory sanctions provision of Rule 11 
     that was adopted in 1983 and eliminated in 1993. The 1993 
     change followed several years of examination and was made on 
     the Judicial Conference's recommendation, with the Supreme

[[Page H9288]]

     Court's approval, and after Congressional review. The 1983 
     provision was eliminated because during the ten years it was 
     in place, it did not provide meaningful relief from the 
     litigation behavior it was meant to address and generated 
     wasteful satellite litigation that had little to do with the 
     merits of a case. On January 26, 2005, Representative Lamar 
     Smith introduced the Lawsuit Abuse Reduction Act of 2005 
     (H.R. 420). The bill would restore the 1983 version of Rule 
     11, undoing the amendments to Rule 11 that took effect in 
     December 1993. The enclosed report shows a remarkable 
     consensus among federal district judges supporting existing 
     Ru1e 11 and opposing its amendment.
       In 1983, Rule 11 was amended to require judges to impose 
     sanctions for violations that could include attorneys' fees. 
     The 1983 version of Rule 11 was intended to address certain 
     improper litigation tactics by providing some punishment and 
     deterrence. The effect was almost the opposite. The 1983 rule 
     presented attorneys with financial incentives to file a 
     sanction motion. The rule was abused by resourceful lawyers. 
     A ``cottage industry'' developed that churned tremendously 
     wasteful satellite sanctions litigation that had everything 
     to do with strategic gamesmanship and little to do with the 
     underlying claims or with the behavior the rule attempted 
     to regulate. Rule 11 motions came to be met with counter 
     motions that sought Rule 11 sanctions for making the 
     original Rule 11 motion. The 1983 version of Rule 11 
     spawned thousands of court decisions unrelated to the 
     merits of the cases, sowed discord in the bar, and 
     generated widespread criticism.
       The 1993 amendments to Rule 11 were designed to remedy 
     major problems shown by experience with the 1983 rule, allow 
     courts to focus on the merits of the underlying cases rather 
     than on Rule II motions, but still provide a meaningful 
     sanction for frivolous pleadings. The rule establishes a 
     ``safe harbor,'' providing a party 21 days within which to 
     withdraw a particular claim or defense before sanctions can 
     be imposed. If the party fails to withdraw an allegedly 
     frivolous claim or defense within the 21 days, a court may 
     impose sanctions, including assessing reasonable attorney 
     fees. Rule 11 does not supplant other remedial actions 
     available to sanction an attorney for a frivolous filing, 
     including punishing the attorney for contempt, employing 
     sanctions under 28 D.S.C. 1927 for ``vexatious'' 
     multiplication of proceedings, or initiating an independent 
     action for malicious prosecution or abuse of process.
       H.R. 420 would amend Rule 11 to restore the 1983 version, 
     by removing a court's discretion to impose sanctions on a 
     frivolous filing and by eliminating the rule's safe-harbor 
     provisions. The Judicial Conference opposed the Lawsuit Abuse 
     Reduction Act of2004 (H.R. 4571), the predecessor of H.R. 
     420. The Judicial Conference based its position on the 
     problems caused by the 1983 version of Rule 11, which H.R. 
     420 would restore. The Judicial Conference noted that these 
     problems included:
       creating a significant incentive to file unmeritorious Rule 
     11 motions by providing a possibility of monetary penalty;
       engendering potential conflict of interest between clients 
     and their lawyers, who advised withdrawal of particular 
     claims despite the clients' preference;
       exacerbating tensions between lawyers; and
       providing little incentive, and perhaps a distinct 
     disincentive, to abandon or withdraw--and thereby admit error 
     on--a pleading or claim after determining that it no longer 
     was supportable in law or fact.
       The Advisory Committee on Civil Rules regularly monitors 
     the operation of the Civil Rules, inviting the bench, bar, 
     and public to inform it of any problems. The Committee stands 
     ready to address any deficiency in the rules, including Rule 
     II. Although the Committee is mindful of Congressional 
     concerns about frivolous filings addressed in pending 
     legislation, the Committee has not received any negative 
     comments or complaints on existing Rule II from the bench, 
     bar, or public. To gain a clearer picture of the operation of 
     Rule 11, the Committee asked the Federal Judicial Center to 
     survey the experience of the trial judges who must apply the 
     rules. The survey sought responses from judges with 
     experience under the 1983 version as well as judges serving 
     only after the 1993 version was adopted. The results of the 
     Federal Judicial Center's survey show that judges strongly 
     believe that Rule 11, which was carefully crafted to deter 
     frivolous filings without unduly hampering the filing of 
     legitimate claims or defenses, continues to work well. The 
     survey's findings include the following highlights:
       More than 80 percent of the 278 district judges surveyed 
     indicate that ``Rule 11 is needed and it is just right as it 
     now stands'';
       87 percent prefer the existing Rule 11 to the 1983 version 
     or the version proposed by legislation (e.g., H.R. 4571 or 
     H.R. 420);
       85 percent strongly or moderately support Rule 11's safe 
     harbor provisions;
       91 percent oppose the proposed requirement that sanctions 
     be imposed for every Rule 11 violation;
       84 percent disagree with the proposition that an award of 
     attorney fees should be mandatory for every Rule 11 
     violation;
       85 percent believe that the amount of groundless civil 
     litigation has not grown since the promulgation of the 1993 
     rule, with 12 percent noting that such litigation has not 
     been a problem, 19 percent noting that such litigation 
     decreased during their tenure on the Federal bench, and 54 
     percent noting that such litigation has remained relatively 
     constant; and
       72 percent believe that addressing sanctions for discovery 
     abuse in Rules 26(g) and 37 is better than in Rule 11.
       The judges' experiences with the 1993 version of Rule 11 
     point to a marked decline in Rule 11 satellite litigation 
     without any noticeable increase in the number of frivolous 
     filings. H.R. 420 would effectively reinstate the 1983 
     version of Rule 11 that proved so contentious and wasted so 
     much time and energy of the bar and bench. Rule 11 in its 
     present form has proven effective and should not be revised. 
     The findings of the Federal Judicial Center underscore the 
     Federal district judges' united opposition to legislation 
     amending Rule 11. I urge you on behalf of the Judicial 
     Conference to oppose legislation amending Rule 11.
       The Judicial Conference appreciates your consideration of 
     its views. If you have any questions, please feel to contact 
     me. I may be reached at (202) 273-3000. If you prefer, you 
     may have your staff contact Karen Kremer, Counsel, Office of 
     Legislative Affairs, Administrative Office of the United 
     States Courts, at (202) 502-1700.
           Sincerely,
                                            Leonidas Ralph Mecham,
                                                        Secretary.

  Mr. McGOVERN. Madam Speaker, I think the reason why we have no other 
speakers on this side is because everything that possibly could be said 
was said last year. So all we need to do is just replay the tape 
recorder and listen to all the arguments. We just seem to be repeating 
the same debates over and over and over again.
  Again, I would urge my colleagues to vote against this legislation. 
This is unwise policy. I understand that the genesis of this 
legislation is to appeal to those who like to contribute lots of money 
to particular campaigns, but, quite frankly, I think that is not a 
sound reason to pass this legislation.
  As I mentioned before, the Judicial Conference of the United States 
has outlined very clearly why this is a bad bill. I would hope that my 
colleagues would listen to some of the experts and do what is right and 
reject this legislation.
  Madam Speaker, I yield back the balance of my time.
  Mr. GINGREY. Madam Speaker, I might point out that the people that 
oppose this legislation, as the gentleman from Massachusetts mentioned 
earlier, are the very ones that support his party. So I think that 
there is a little balance there, if that be true in either instance.
  Madam Speaker, I would first like to close this debate by thanking my 
colleagues for a very productive discussion of both the rule and H.R. 
420. The opportunity before this House today is another example of how 
this Congress has improved our legal system and preventing frivolous 
lawsuits from closing the doors of justice for those who have truly 
been harmed.
  Contrary to what the opponents of legal reform might say, the 
underlying bill, as well as other recent bills, do not demonstrate 
contempt for our legal system or the esteemed profession of attorneys, 
but rather demonstrate respect for the important and historic role of 
our judicial system in defending the rights and ensuring the 
constitutional application of the laws. Frivolous lawsuits have not 
only driven up costs and destroyed economic opportunity for the 
American people, but they have also damaged the image of the courts. 
When the American people stop respecting the decisions of the 
judiciary, the courts begin to lose their effectiveness, and they cease 
to perform their constitutionally mandated role.
  For the sake of the courts and for the sake of the American people, 
we in this House need to push forward with this additional meaningful 
and genuine reform. Therefore, I would like to urge all of my 
colleagues on both sides of the center aisle to support this rule and 
the underlying bill.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, while the Committee on Rules 
reported out a rule that made in order a substantive amendment offered 
by the Gentleman from California, Mr. Schiff, I rise in opposition to 
it, H. Res. 508 because the legislation underlying is pernicious.
  As I mentioned during the Committee on the Judiciary's oversight 
hearing on this legislation during its first iteration in the 108th 
Congress and reiterated in my statement for the markup, one of the main 
functions of that body's oversight is to analyze potentially negative 
impact against the benefits that a legal process or piece of 
legislation will have on those affected. The base bill before the House 
today does not represent the product of careful analysis and

[[Page H9289]]

therefore, it is critical that Members be given the ability to offer 
amendments to improve its provisions.
  In the case of H.R. 4571, the Lawsuit Abuse Reduction Act the 
oversight functions of the Judiciary Committee allowed us to craft a 
bill that will protect those affected from negative impacts of the 
shield from liability that it proposes. This legislation requires an 
overhaul in order to make it less of a misnomer--to reduce abuse rather 
than encourage it.
  The goal of the tort reform legislation is to allow businesses to 
externalize, or shift, some of the cost of the injuries they cause to 
others. Tort law always assigns liability to the party in the best 
position to prevent an injury in the most reasonable and fair manner. 
In looking at the disparate impact that the new tort reform laws will 
have on ethnic minority groups, it is unconscionable that the burden 
will be placed on these groups--that are in the worst position to bear 
the liability costs.
  When Congress considers pre-empting state laws, it must strike the 
appropriate balance between two competing values--local control and 
national uniformity. Local control is extremely important because we 
all believe, as did the Founders two centuries ago, that State 
governments are closer to the people and better able to assess local 
needs and desires. National uniformity is also an important 
consideration in federalism--Congress' exclusive jurisdiction over 
interstate commerce has allowed our economy to grow dramatically over 
the past 200 years.
  This legislation would reverse the changes to Rule 11 of the Federal 
Rules of Civil Procedure, FRCP, that were made by the Judicial 
Conference in 1993 such that (1) sanctions against an attorney whose 
litigation tactics are determined to harass or cause unnecessary delay 
or cost or who has been determined to have made frivolous legal 
arguments or unwarranted factual assertions would become mandatory 
rather than discretionary to the court, (2) discovery-related activity 
would be included within the scope of the Rule, and (3) the Rule would 
be extended to state cases affecting interstate commerce so that if a 
state judge decides that a case affects interstate commerce, he or she 
must apply Rule 11 if violations are found.
  This legislation strips State and Federal judges of their discretion 
in the area of applying Rule 11 sanctions. Furthermore, it infringes 
States' rights by forcing State courts to apply the rule if interstate 
commerce is affected. Why is the discretion of the judge not sufficient 
in discerning whether Rule 11 sanctions should be assessed?
  If this legislation moves forward in this body, it will be important 
for us to find out its effect on indigent plaintiffs or those who must 
hire an attorney strictly on a contingent--fee basis. Because the 
application of Rule 11 would be mandatory, attorneys will pad their 
legal fees to account for the additional risk that they will have to 
incur in filing lawsuits and the fact that they will have no 
opportunity to withdraw the suit due to a mistake. Overall, this 
legislation will deter indigent plaintiffs from seeking counsel to file 
meritorious claims given the extremely high legal fees.
  Furthermore, H.R. 4571, as drafted, would allow corporations that 
perform sham and non-economic transactions in order to enjoy economic 
benefits in this country .
  This is a bad rule that will have terrible implications on our 
legislative branch, and I ask that my colleagues to defeat the rule, 
defeat the bill, and support the Substitute offered by Mr. Schiff. We 
must carefully consider the long-term implications that this bill, as 
drafted, will have on indigent claimants, the trial attorney community, 
and facilitation of corporate fraud.
  Mr. GINGREY. Madam Speaker, I yield back the balance of my time, and 
I move the previous question on the resolution.
  The previous question was ordered.
  The resolution was agreed to.
  A motion to reconsider was laid on the table.

                          ____________________