Capitol View V O L U M E 2 , N U M B E R 3 A U G U S T 2 0 0 3 Update on Tort Reform During the First Session of the 108 th Congress, three major pieces of tort reform legislation have been under consideration by the Senate and the House. Democrats generally oppose the class action and medical malpractice reform bills but have been working to modify the asbestos litigation reform bill in the Senate Judiciary Committee so that they could ultimately support it on the Senate floor. While each of these bills face serious obstacles, particularly in the Senate, Republican control of both Houses of Congress gives them a better chance of enactment than they have had in past years. Asbestos Litigation Reform On the night of July 10, 2003, after a grueling 12-hour markup session, the Senate Judiciary Committee approved an amended version of the Fairness in Asbestos Injury Resolution Act (S.1125) by a vote of 10-8. All Republicans, with the exception of Senator Jon Kyl (R-AZ) who voted present, supported the bill. Chairman Hatch (R-UT) had been working hard to attract some Democratic support for the bill on the Committee so that it could be viewed as bipartisan legislation and he was somewhat successful in the effort as Senator Feinstein (D-CA) voted for the bill. However, she was the only Democrat on the Committee who voted for the bill on final passage. S.1125 is designed to address the serious problem with the growing volume of cases in the court system involving asbestos related injuries. Currently there are already some 600,000 claims pending nationwide with new asbestos cases being filed at a rate of 50,000 per year. On March 10, 2003 the United States Supreme Court in its opinion in Norfolk & Western v. Ayers urged Congress to enact legislation to handle the asbestos litigation crisis characterizing it as an "elephantine mass" of cases in state courts which the traditional judicial system is unable to properly administer. S.1125 would remove these asbestos cases from the judicial system and establish a no fault Federal administrative procedure which would pay asbestos claimants from an Asbestos Injury Claims Resolution Fund (Fund). Monies for the Fund would be provided by companies which manufactured or used asbestos and insurance companies. Consideration of the asbestos legislation by the Senate Judiciary Committee has been extremely contentious. In addition to the 12 hour markup session on July 10, there was a 13 hour session on June 26, along with two shorter Committee meetings all devoted to consideration of S.1125. Republicans generally support the enactment of asbestos legislation as long as it does not impose too great a burden on the corporations and insurance companies that will have to fund it. Democrats also voiced general support for an asbestos bill but complained that the original version of S.1125 did not cover enough people who suffered from asbestos related illnesses and did not award adequate monetary claims for those claimants it did cover. These partisan differences manifested themselves in three specific controversial issues concerning the asbestos bill; the proper medical criteria as to who should be covered as a claimant under the bill, sufficient money for the Fund to insure its solvency to cover all potential claimants, and the size of the awards the Fund would provide to victims. The medical criteria issue was resolved by a bipartisan agreement between Chairman Hatch and the Ranking Democrat, Patrick Leahy V A L U E A D D E D , V A L U E S D R I V E N. SM
C A P I T O L V I E W A U G U S T 2 0 0 3 2 (D-VT), which expanded the criteria for claimants. A bipartisan compromise between Chairman Hatch and Senators Feinstein and Kohl (D-WI) provided additional "back up" money for the Fund. Finally during the markup on July 10, Senators Feinstein and Graham (R-SC) proposed an amendment which would adjust the claim award level by decreasing the levels for those suffering from mild cases of asbestos-related disease and increasing awards for those suffering from more serious forms of the disease. This amendment was supported by Chairman Hatch, most Committee Republicans, and even several Democrats including Senators Leahy and Durbin (D-IL). However, unlike the medical criteria and Fund solvency agreements, Senator Leahy emphasized he was supporting the amendment for purposes of reporting the bill from the Committee and he still considered the awards established by the Feinstein-Graham-Hatch amendment to be insufficient. Clearly, the Judiciary Committee approval of the Act was a major accomplishment by Chairman Hatch. However, the difficulty in securing its approval, encompassing four full Committee markup sessions, including two 10-12 hour meetings, and in the end attracting only one Democratic vote is an indication of the problems likely to be encountered on the Senate Floor should it even be brought up on the Floor by the Leadership. This is particularly the case if opponents threaten to filibuster the bill and thereby require supporters to produce 60 votes to invoke cloture and thereby end any filibuster. Organized labor, and some Judiciary Committee Democrats, continue to oppose the bill on the grounds that the award values are too low. Trial lawyers generally oppose any legislation limiting tort claims and now some insurance companies that had earlier supported an asbestos reform bill are concluding that this particular vehicle has become too expensive. Compounding the problem more are some Republicans, such as Senator Specter (R-PA), who voted for reporting the bill out of Committee, but who expressed "grave reservations" about the bill. It appears that those supporting asbestos reform legislation will have to continue to negotiate on various issues. It is only through reaching at least a general consensus on these issues that a filibuster on the Floor can be avoided. However, there is a limit as to how much is realistically negotiable. Some Democrats are insisting that more money be put into the bill while some Republicans complain that it already has become too expensive. Medical Malpractice Reform In March of this year the House passed the Help Efficient, Accessible, Low Cost, Timely Healthcare Act of 2003 (H.R.5) by a vote of 229-196. This bill would reform the nation's medical liability system by establishing a three year statute of limitations, permitting evidence of collateral source benefits and limiting non-economic damages to $250,000. While this bill passed the House by a comfortable margin, the prospect for passage of it in the Senate is more problematic. On July 9 the Senate voted on a cloture petition to limit debate on a Motion to Proceed to consider the Patient First Act of 2003 (S.11), a medical malpractice reform bill very similar to that adopted by the House. The vote failed 49-48, far short of the 60 votes needed. Perhaps even more disturbing to proponents of medical malpractice reform in the Senate than the 11 vote deficit to invoke cloture was the fact that not one Democrat supported limiting the debate. Two Republicans, Senator Richard Shelby (R-AL) and Senator Lindsey Graham (R-SC), joined the Democrats in voting against cloture. On July 8, Senators Richard Durbin (D-IL) and Lindsey Graham introduced the Better Health Act of 2003 (S.1374). This bill was characterized by the Democratic Leader, Tom Daschle, as an alternative to the Republican Patient First Act. It would enact limits on frivolous medical malpractice suits and amend the McCarren-Ferguson Act, which excludes the insurance industry from Federal jurisdiction, to prohibit commercial insurers from engaging in any form of "price fixing, bid rigging or market allocation in connection with the conduct of the business of providing medical malpractice insurance." V A L U E A D D E D , V A L U E S D R I V E N. SM
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