Senate Republicans Seek to Limit Class-Action Suits
By Helen Dewar
Washington Post Staff Writer
Tuesday, July 6, 2004; Page A02
Senate Republicans will target huge legal fees in class-action lawsuits this week as they try to salvage at least one key element of their "tort reform" agenda to revamp the nation's civil litigation system.
The bill that will come before the Senate when it returns today from its Fourth of July recess would shift many such suits to the federal judicial system, removing them from state courts that in some cases have become magnets for suits because of their history of big settlements.
In a confrontation of powerful political interests, the battle pits the business groups, which tend to support Republicans, against trial lawyers and consumer, civil rights and environmental groups that work more closely with Democrats. Business interests contribute heavily to Republican campaigns, while trial lawyers are a major source of campaign money for Democrats.
Supporters of the legislation contend it is necessary to end frivolous lawsuits and other abuses that have threatened businesses, enriched lawyers and provided little compensation to people on whose behalf the suits were filed. Opponents argue that it would protect businesses with faulty products or practices while limiting people's access to courts to seek redress for legitimate injuries.
"There are a number of juries on the state level where a lot of abuses are going on," said Stan Anderson, a top U.S. Chamber of Commerce official and chairman of the business-backed Class Action Fairness Coalition, which is leading the fight for passage of the bill. "It's strictly process; it doesn't affect anyone's substantive rights."
Not so, said Sally Greenberg, senior counsel for the Consumers Union, part of a coalition that opposes the bill. "It's a radical restructuring of our judicial system that summarily takes from state courts a number of state issues without any real justification except that federal courts seem more sympathetic to corporate interests."
The Senate class-action measure, sponsored by Sen. Charles E. Grassley (R-Iowa) and other members of the Judiciary Committee, has drawn more support than other unsuccessful GOP tort efforts, in part because of many lawmakers' disdain for the huge settlements that have enriched lawyers far more than the plaintiffs they represented.
In one case cited by the bill's proponents, plaintiffs in a suit challenging the purity of a company's bottled water received only discount coupons for more of the same water, while lawyers picked up $1.35 million in fees.
"The reality is that the class action system is broken and we should do something about it," Grassley said in a statement released by his office. "The current class action system is rife with problems which have undermined the rights of both plaintiffs and defendants alike."
In class-action lawsuits, a case alleging injury against a particular defendant is expanded to cover others who may have been affected in the same way, such as minorities in a discrimination case or buyers of the same defective product.
Under the bill, class actions involving at least 100 plaintiffs could be sent to federal court if at least $5 million is at stake and fewer than two-thirds of the plaintiffs live in the same state as the primary defendant.
The measure narrowly failed last year but picked up enough votes for passage when three Democrats negotiated changes that would allow cases that were essentially more local to remain in state courts, among other things.
This year, 11 Democrats have indicated support for the measure, giving it at least 62 votes -- more than enough for passage without risk of a filibuster by Democratic foes of the legislation.
The question is whether it ever gets to a final vote.
Democrats, contending this bill represents the last realistic opportunity this year for consideration of their top agenda items, intend to offer an amendment to increase the hourly minimum wage from $5.15 to $7 over the next two years. They are also considering several other initiatives opposed by many Republicans, including controls on greenhouse gas emissions, renewal of the assault weapons ban (which expires this year), legislation to allow re-importation of low-cost drugs and a proposal to require parity in insurance coverage of physical and mental illnesses.
Passage of one or more of these could complicate final passage and negotiations on a final version of the bill with the House, which last year approved a more stringent class-action bill without any of the add-ons that Senate Democrats are advocating. Republicans have talked about trying to cut off Democratic amendments after a certain point, which could lead to a deadlock. Also, Democrats, excluded in the past from House-Senate conferences, are reluctant to agree to conferences on bills such as this without guarantees that they will be full participants in negotiations.
In other words, despite a filibuster-proof majority in favor of the class-action measure, its enactment is far from certain.
The rest of the GOP's tort agenda -- which party leaders regard as a good issue for the November elections -- lies in tatters on the Senate floor, even though the bills passed the House with relative ease.
For example, bills to impose limits on awards in medical malpractice cases, including narrow measures to cover critical specialties such as obstetrics and gynecology (later expanded to include emergency room personnel), were blocked by the Democrats as infringements on patients' rights.
A bill to shield gun manufacturers from liability suits was withdrawn by its sponsors after it was amended by gun control advocates to include renewal of the assault weapons ban and curbs on unlicensed sales at gun shows.
© 2004 The Washington Post Company