    [Public Papers of the Presidents of the United States: William J. Clinton (1996, Book I)]
    [May 2, 1996]
    [Pages 681-682]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Message to the House of Representatives Returning Without Approval
    Product Liability Legislation
    May 2, 1996

    To the House of Representatives:
        I am returning herewith without my approval H.R. 956, the ``Common
    Sense Product Liability Legal Reform Act of 1996.''
        I support real commonsense product liability reform. To deserve that
    label, however, legislation must adequately protect the interests of
    consumers, in addition to the interests of manufacturers and sellers.
    Further, the legislation must respect the important role of the States
    in our Federal system. The Congress could have passed such legislation,
    appropriately limited in scope and balanced in application, meeting
    these tests. Had the Congress done so, I would have signed the bill
    gladly. The Congress, however, chose not to do so, deciding instead to
    retain provisions in the bill that I made clear I could not accept.
        This bill inappropriately intrudes on State authority, and does so
    in a way that tilts the legal playing field against consumers. While
    some Federal action in this area is proper because no one State can
    alleviate nationwide problems in the tort system, the States should
    have, as they always have had, primary responsibility for tort law. The
    States traditionally have handled this job well, serving as laboratories
    for new ideas and making needed reforms. This bill unduly interferes
    with that process in products cases; moreover, it does so in a way that
    peculiarly disadvantages consumers. As a rule, this bill displaces State
    law only when that law is more favorable to consumers; it defers to
    State law when that law is more helpful to manufacturers and sellers. I
    cannot accept, absent compelling reasons, such a one-way street of
    federalism.
        Apart from this general problem of displacing State authority in an
    unbalanced manner, specific provisions of H.R. 956 unfairly disadvantage
    consumers and their families. Consumers should be able to count on the
    safety of the products they purchase. And if these products are
    defective and cause harm, consumers should be able to get adequate
    compensation for their losses. Certain provisions in this bill work
    against these goals, preventing some injured persons from recovering the
    full measure of their damages and increasing the possibility that
    defective goods will come onto the market as a result of intentional
    misconduct.
        In particular, I object to the following provisions of the bill,
    which subject consumers to too great a risk of harm.
        First, as I previously have stated, I oppose wholly eliminating
    joint liability of noneconomic damages such as pain and suffering
    because such a change would prevent many persons from receiving full
    compensation for injury. When one wrongdoer cannot pay its portion of
    the judgment, the other wrongdoers, and not the innocent victim, should
    have to shoulder that part of the award. Traditional law accomplishes
    this result. In contrast, this bill would leave the victim to bear these
    damages on his or her own. Given how often companies that manufacture
    defective products go bankrupt, this provision has potentially large
    consequences.
        This provision is all the more troubling because it unfairly
    discriminates against the most vulnerable members of our society--the
    elderly, the poor, children, and nonworking women--whose injuries often
    involve mostly noneconomic losses. There is no reason for this kind of
    discrimination. Noneconomic damages are as real and as important to
    victims as economic damages. We should not create a tort system in which
    people with the greatest need of protection stand the least chance of
    receiving it.

    [[Page 682]]

        Second, as I also have stated, I oppose arbitrary ceilings on
    punitive damages, because they endanger the safety of the public.
    Capping punitive damages undermines their very purpose, which is to
    punish and thereby deter egregious misconduct. The provision of the bill
    allowing judges to exceed the cap if certain factors are present helps
    to mitigate, but does not cure this problem, given the clear intent of
    the Congress, as expressed in the Statement of Managers, that judges
    should use this authority only in the most unusual cases.
        In addition, I am concerned that the Conference Report fails to fix
    an oversight in title II of the bill, which limits actions against
    suppliers of materials used in devices implanted in the body. In
    general, title II is a laudable attempt to ensure the supply of
    materials needed to make life-saving medical devices, such as artificial
    heart valves. But as I believe even many supporters of the bill agree, a
    supplier of materials who knew or should have known that the materials,
    as implanted, would cause injury should not receive any protection from
    suit. Title II's protections must be clearly limited to nonnegligent
    suppliers.
        My opposition to these Senate-passed provisions were known prior to
    the Conference on the bill. But instead of addressing these issues, the
    Conference Committee took several steps backward in the direction of the
    bill approved by the House.
        First, the Conference Report seems to expand the scope of the bill,
    inappropriately applying the limits on punitive and noneconomic damages
    to lawsuits, where, for example, a gun dealer has knowingly sold a gun
    to a convicted felon or a bar owner has knowingly served a drink to an
    obviously inebriated customer. I believe that such suits should go
    forward unhindered. Some in the Congress have argued that the change
    made in Conference is technical in nature, so that the bill still
    exempts these actions. But I do not read the change in this way--and in
    any event, I do not believe that a victim of a drunk driver should have
    to argue in court about this matter. The Congress should not have made
    this last-minute change, creating this unfortunate ambiguity, in the
    scope of the bill.
        In addition, the Conference Report makes certain changes that,
    though sounding technical, may cut off a victim's ability to sue a
    negligent manufacturer. The Report deletes a provision that would have
    stopped the statute of limitations from running when a bankruptcy court
    issues the automatic stay that prevents suits from being filed during
    bankruptcy proceedings. The effect of this seemingly legalistic change
    will be that some persons harmed by companies that have entered
    bankruptcy proceedings (as makers of defective products often do) will
    lose any meaningful opportunity to bring valid claims.
        Similarly, the Conference Report reduces the statute of repose to 15
    years (and less if States so provide) and applies the statute to a wider
    range of goods, including handguns. This change, which bars a suit
    against a maker of an older product even if that product has just caused
    injury, also will preclude some valid suits.
        In recent weeks, I have heard from many victims of defective
    products whose efforts to recover compensation would have been
    frustrated by this bill. I have heard from a woman who would not have
    received full compensatory damages under this bill for the death of a
    child because one wrongdoer could not pay his portion of the judgment. I
    have heard from women whose suits against makers of defective
    contraceptive devices--and the punitive damages awarded in those suits--
    forced the products off the market, in a way that this bill's cap on
    punitives would make much harder. I have heard from persons injured by
    products more than 15 years old, who under this bill could not bring
    suit at all.
        Injured people cannot be left to suffer in this fashion;
    furthermore, the few companies that cause these injuries cannot be left,
    through lack of a deterrent, to engage in misconduct. I therefore must
    return the bill that has been presented to me. This bill would undermine
    the ability of courts to provide relief to victims of harmful products
    and thereby endanger the health and safety of the entire American
    public. There is nothing common sense about such reforms to product
    liability law.

                                                          William J. Clinton

    The White House,

    May 2, 1996.