Virginia passes bill to limit legal claims on one firm

By Anita Kumar
Washington Post Staff Writer
Wednesday, February 10, 2010; B01

RICHMOND -- The Virginia House of Delegates passed a bill that would help protect a single Fortune 500 company from asbestos lawsuits -- a proposal that House Speaker William J. Howell has been quietly maneuvering to have his chamber support for weeks.

The powerful Republican leader took the unusual step of pleading his case to his caucus behind closed doors, said several delegates, who spoke on the condition of anonymity for fear of repercussions. Howell also personally visited individual delegates, including Democrats, and encouraged them to back the measure as a "personal favor," according to several sources. And he reshuffled the committee that was considering the bill -- which it approved last week after it was unexpectedly killed in committee two years in a row.

As he presided over the debate on the House floor this week, an unusually curt Howell told one Democratic delegate who stood to speak on the bill to sit down, and ignored a question from another.

The measure passed an initial vote on Monday, but was defeated unexpectedly Tuesday on a tie vote after some Republicans switched positions and others, who were absent from the earlier vote because of snow, sided against it. Under House rules, the measure was able to be heard again and, on its final try, it passed 49 to 48.

Three lawmakers, including Del. David B. Albo (R-Fairfax), switched their votes to support. Albo said several House leaders, including Majority Leader H. Morgan Griffith (R-Salem), persuaded him to back the bill in order to win approval of his own priorities, including funding for Northern Virginia schools, later in the legislative session.

The proposal -- one of the few that Howell put his considerable power behind -- would limit liability for Philadelphia-based Crown Cork & Seal, which employs 300 workers at plants in Virginia. The bill's fate in the Democratic-controlled Senate is not certain.

Howell, 66, of Stafford, declined to be interviewed for this article. But his chief of staff, G. Paul Nardo, said the speaker pursued the proposal because of his long-standing interest in tort reform and because of his involvement with the American Legislative Exchange Council, a conservative group that has been pushing the Crown Cork bill in state legislatures across the nation since 2006. Nardo provided copies of ALEC's model asbestos legislation as well as the group's backup materials supporting the bill. Howell served as the group's national chairman last year.

Del. Terry G. Kilgore (R-Scott), who introduced the bill on Howell's behalf, said the proposal continues a decade-long trend to limit litigation through caps on medical malpractice cases, time limits on lawsuits and other techniques.

"I thought it might be a good type of tort relief for Virginia,'' said Kilgore, a member of ALEC for 15 years. "It gets someone out of the mix of those asbestos cases that really shouldn't be in the mix in the first place."

Greg Marston, state legislative director for the Teamsters union, which opposes the bill, said Howell wants to set a precedent so other companies could win limits on liability, too. "It's his bill,'' he said. "He is using his power to threaten delegates to vote for the bill."

ALEC's role

ALEC is a pro-business, free-market group that ghostwrites bills on a variety on subjects that are pushed by its members -- both legislators as well as private companies, which pay thousands of dollars to become members of ALEC, giving them a say in what legislation the group backs. Crown Cork, which has given $8,000 to Howell's political action committee since 2008, is a member of ALEC, according to company officials and state records.

Since ALEC wrote and began pushing asbestos legislation in 2006, 11 states have passed similar bills, said Amy Kjose, director of the group's civil justice task force. It's being considered in five other states, including Virginia.

Crown Cork, where the bottle cap was invented, got into the asbestos business when it bought a small, family-owned company for $7 million in 1963. Before the sale, that company, Mundet, had been involved in asbestos insulation for years, company officials said.

Crown Cork has since been named in more than 300,000 asbestos claims; it paid $600 million in expenses and coped with higher interest rates on borrowing, according to company documents. William Gallagher, the company's general counsel, said he doesn't consider the proposal "special legislation" because other firms may be in the same situation without coming forward.

Bill Axselle, former legislator and the firm's top lobbyist in Richmond, said Crown Cork, which had to pare its workforce, risked losing its Virginia plants if the bill did not pass.

ALEC, founded almost four decades ago by the father of the modern conservative movement, Paul Weyrich, includes about 2,000 state legislators as well as 300 companies, such as ExxonMobil, Coca-Cola and Wal-Mart Stores, according to group officials and documents.

Membership costs $7,000 for companies, $3,500 for nonprofit groups and $50 for legislators, said Jorge Amselle, ALEC's director of public affairs. Fees make up the bulk of its $7 million annual budget, documents filed with the Internal Revenue Service show.

Alan Rosenthal, a professor of public policy at Rutgers University, said ALEC is unique among organizations that lobby state governments because it lets corporations have a vote. "It's another device they can use to advance their agenda," he said.

The effort in Virginia

Two years ago, Crown Cork spent $25,095 on four lobbyists to help get the bill passed, according to state records. Last year, it spent $84,167 on seven lobbyists. This year, they had the same seven lobbyists, though one left to work for newly elected Republican Gov. Robert F. McDonnell.

The first year, the bill died in committee. Howell directed it to a different committee last year, but it went down in a surprising defeat when five Republicans joined all the Democrats in opposition.

This year, Howell altered the makeup of the 22-member committee -- two Democrats were removed and three open seats were filled with Republicans who backed the legislation, which passed 11 to 9.

Del. Kenneth R. Plum (Fairfax), the second highest-ranking Democrat in the House, and Del. Mark D. Sickles, another Fairfax County Democrat, said they suspected their votes against the bill last year had something to do with Howell putting them on other committees. "Why would a 28-year veteran and former chairman be removed?'' Plum asked. "What's the message in that?"

Since 2007, Crown Cork has donated more than $100,000 to 46 Virginia legislators or their political action committees, including most members of the House and Senate committees where the bills would be directed, according to the Virginia Public Access Project, a nonpartisan tracker of money in politics.

In the days prior to the committee vote, Howell was seen lobbying members in the halls of the Capitol and in their offices -- a sight not seen since he pressed members to support a landmark transportation package in 2007.

The 30-minute House Commerce and Labor Committee hearing last week included testimony from representatives of Owens Illinois, a Fortune 500 glass container manufacturer that argued it would pay more in asbestos claims if Crown Cork was no longer held liable. Trial lawyers, manufacturers and some unions also opposed the bill.

Richard Ottinger, a lawyer representing Owens Illinois, which has two factories in Virginia, employing 350 people, said the bill "specifically benefits one company to the detriment of other companies."

Del. Jennifer L. McClellan (D-Richmond), who voted against the bill two years in a row, even though she was personally lobbied by Howell this year, said, "It just smelled fishy to me."

Del. Thomas Davis Rust (R-Fairfax) opposed the legislation last year and was lobbied heavily this year to change his vote.

"It's bad policy to do for one company,'' he said in an interview the day before the committee vote. "To do this for one company would open up the floodgates."

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