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H.Doc.104-208 STATUS ON IRAQ ...
104th Congress, 2d Session - - - - - - - - - - House Document 104-207 VETO OF H.R. 956 __________ MESSAGE from THE PRESIDENT OF THE UNITED STATES transmitting HIS VETO OF H.R. 956, A BILL TO ESTABLISH LEGAL STANDARDS AND PROCEDURES FOR PRODUCT LIABILITY LITIGATION, AND FOR OTHER PURPOSES <GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT> May 6, 1996.--Message and accompanying bill ordered to be printed 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 for 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. 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. H.R. 956 One Hundred Fourth Congress of the United States of America, at the First Session, Begun and Held at the City of Washington on Wednesday, the Third Day of January, One Thousand Nine Hundred and Ninety-Six An Act To establish legal standards and procedures for product liability litigation, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. (a) Short Title.--This Act may be cited as the ``Common Sense Product Liability Legal Reform Act of 1996''. (b) Table of Contents.--The table of contents is as follows: Sec. 1. Short title and table of contents. Sec. 2. Findings and purposes. TITLE I--PRODUCT LIABILITY REFORM Sec. 101. Definitions. Sec. 102. Applicability; preemption. Sec. 103. Liability rules applicable to product sellers, renters, and lessors. Sec. 104. Defense based on claimant's use of intoxicating alcohol or drugs. Sec. 105. Misuse or alteration. Sec. 106. Uniform time limitations on liability. Sec. 107. Alternative dispute resolution procedures. Sec. 108. Uniform standards for award of punitive damages. Sec. 109. Liability for certain claims relating to death. Sec. 110. Several liability for noneconomic loss. Sec. 111. Workers' compensation subrogation. TITLE II--BIOMATERIALS ACCESS ASSURANCE Sec. 201. Short title. Sec. 202. Findings. Sec. 203. Definitions. Sec. 204. General requirements; applicability; preemption. Sec. 205. Liability of biomaterials suppliers. Sec. 206. Procedures for dismissal of civil actions against biomaterials suppliers. TITLE III--LIMITATIONS ON APPLICABILITY; EFFECTIVE DATE Sec. 301. Effect of court of appeals decisions. Sec. 302. Federal cause of action precluded. Sec. 303. Effective date. SEC. 2. FINDINGS AND PURPOSES. (a) Findings.--The Congress finds that-- (1) our Nation is overly litigious, the civil justice system is overcrowded, sluggish, and excessively costly and the costs of lawsuits, both direct and indirect, are inflicting serious and unnecessary injury on the national economy; (2) excessive, unpredictable, and often arbitrary damage awards and unfair allocations of liability have a direct and undesirable effect on interstate commerce by increasing the cost and decreasing the availability of goods and services; (3) the rules of law governing product liability actions, damage awards, and allocations of liability have evolved inconsistently within and among the States, resulting in a complex, contradictory, and uncertain regime that is inequitable to both plaintiffs and defendants and unduly burdens interstate commerce; (4) as a result of excessive, unpredictable, and often arbitrary damage awards and unfair allocations of liability, consumers have been adversely affected through the withdrawal of products, producers, services, and service providers from the marketplace, and from excessive liability costs passed on to them through higher prices; (5) excessive, unpredictable, and often arbitrary damage awards and unfair allocations of liability jeopardize the financial well- being of many individuals as well as entire industries, particularly the Nation's small businesses and adversely affects government and taxpayers; (6) the excessive costs of the civil justice system undermine the ability of American companies to compete internationally, and serve to decrease the number of jobs and the amount of productive capital in the national economy; (7) the unpredictability of damage awards is inequitable to both plaintiffs and defendants and has added considerably to the high cost of liability insurance, making it difficult for producers, consumers, volunteers, and nonprofit organizations to protect themselves from liability with any degree of confidence and at a reasonable cost; (8) because of the national scope of the problems created by the defects in the civil justice system, it is not possible for the States to enact laws that fully and effectively respond to those problems; (9) it is the constitutional role of the national government to remove barriers to interstate commerce and to protect due process rights; and (10) there is a need to restore rationality, certainty, and fairness to the civil justice system in order to protect against excessive, arbitrary, and uncertain damage awards and to reduce the volume, costs, and delay of litigation. (b) Purposes.--Based upon the powers contained in Article I, Section 8, Clause 3 and the Fourteenth Amendment of the United States Constitution, the purposes of this Act are to promote the free flow of goods and services and to lessen burdens on interstate commerce and to uphold constitutionally protected due process rights by-- (1) establishing certain uniform legal principles of product liability which provide a fair balance among the interests of product users, manufacturers, and product sellers; (2) placing reasonable limits on damages over and above the actual damages suffered by a claimant; (3) ensuring the fair allocation of liability in civil actions; (4) reducing the unacceptable costs and delays of our civil justice system caused by excessive litigation which harm both plaintiffs and defendants; and (5) establishing greater fairness, rationality, and predictability in the civil justice system. TITLE I--PRODUCT LIABILITY REFORM SEC. 101. DEFINITIONS. For purposes of this title-- (1) Actual malice.--The term ``actual malice'' means specific intent to cause serious physical injury, illness, disease, death, or damage to property. (2) Claimant.--The term ``claimant'' means any person who brings an action covered by this title and any person on whose behalf such an action is brought. If such an action is brought through or on behalf of an estate, the term includes the claimant's
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