TheWeekInCongress.com
Week Ending October 28, 2005
H.R.420 To amend Rule 11 of the Federal Rules of Civil Procedure to improve attorney accountability, and for other purposes.
BRIEF
The bill would amend civil court procedures and make the court’s discretionary choice of sanctioning attorneys, law firms and parties determined to have filed a frivolous lawsuit, a requirement. The statute impacted is Rule 11 (c) of the Federal Rules of Civil Procedure. Procedural efforts to circumvent the requirement are also blocked by the bill.
After a determination that the suit is frivolous the courts could award the defending party reasonable expenses and attorney fees and reimbursement of litigation costs.
Further, the bill would require that personal injury claims that would have been filed in state or federal court be filed in the county or federal district in which the claimant lives or lived when injured, where the alleged injury occurred, where the defendant’s business is located or where the defendant resides. The trial court will decide the appropriate venue.
Under the bill a federal district court is required to suspend an attorney’s license to practice law in that Federal court for a year or more for violating the Rule 11 three or more times. The affected attorney would have the right to appeal the suspension, must later petition the court for reinstatement and conditions governing reinstatement of the license would be determined by the court.
The bill determines that a frivolous lawsuit includes an attempt to litigate an issue that has been litigated and failed on three occasions.
Punishments are included to cover anyone who influences, obstructs or impedes or endeavors to influence, obstruct, or impeded a pending court proceeding through the intentional destruction of documents sought in or highly relevant to the proceeding. The violator would be held in contempt and could suffer civil sanctions.
The bill itself does not define frivolous lawsuits. The Statue governing this bill’s directives includes some descriptions that may lend themselves to determining if a suit is frivolous. The attorney or claimant essentially are certifying that to the best of their knowledge the suit is: not intended for an improper purpose such as harassment or to cause delay or needles increase in the cost of the suit; that the claims are warranted by existing law or by non-frivolous argument or modification of existing law; that the accusations have evidence supporting them or are likely to have that evidence after discovery and that denials of contentions are warranted on the evidence of a lack of information or belief.
Sponsor: Representative Lamar Smith (R-TX-21st)
Vote: The bill passed the House 228 to 184 (RC 553) October 26, 2005. A Motion to Recommit the bill with Instructions failed 196 to 215 (RC 552) October 26, 2005.
Cost to the taxpayers: The bill has no impact on federal spending or revenues.
## All Rights Reserved. © 2005 TheWeekInCongress.com No reproduction or distribution without written permission from TheWeekInCongress.com.
LAWSUITS HAVE BECOME A THREAT TO BUSINESSES
The Lawsuit Abuse Reduction Act of 2005 (`LARA'), H.R. 420, was introduced by Rep. Lamar Smith. H.R. 420 will restore the teeth to Federal Rule of Civil Procedure 11 it once had to deter frivolous Federal lawsuits. It would also extend Rule 11's protections to prevent frivolous lawsuits in state courts when state judges determine a case would have national economic consequences that affect interstate commerce. The bill would also prevent forum shopping, the nefarious practice by which personal injury attorneys bring lawsuits in courts that notoriously and consistently hand down astronomical awards even when the case has little or no connection to the court's jurisdiction. H.R. 420 would prevent forum shopping by requiring that personal injury cases be brought only in the plaintiff's place of residence, where the plaintiff was allegedly injured, where the defendant's principal place of business is located, or where the defendant resides.
LARA would: (1) restore mandatory sanctions for filing frivolous lawsuits in violation of Rule 11; (2) remove Rule 11's `safe harbor' provision that currently allows parties and their attorneys to avoid sanctions for making frivolous claims by withdrawing frivolous claims after a motion for sanctions has been filed; (3) allow monetary sanctions, including attorneys' fees and compensatory costs, against any party making a frivolous claim; (4) apply Rule 11's provisions to state cases a state judge finds affect interstate commerce; (5) require that personal injury cases be brought only where the plaintiff resides, where the plaintiff was allegedly injured, where the defendant's principal place of business is located, or where the defendant resides; (6) apply a `three strikes and you're out' rule to attorneys who commit Rule 11 violations in Federal district court; (7) impose mandatory civil sanctions for document destruction intended to obstruct a pending court proceeding; and (8) provide that if a party attempts to relitigate a losing claim more than three consecutive times, there shall be a rebuttable presumption that Rule 11 has been violated.
H.R. 420 applies to cases brought by individuals as well as businesses (both big and small), including business claims filed to harass competitors and illicitly gain market share. The bill also applies to both plaintiffs and defendants. 1
[Footnote]
[Footnote 1: Under the pre-1993 Rule 11, sanctions were imposed on
defendants for having raised frivolous defenses. In SEC v. Keating,
1992 WL 207918, [1992 Transfer Binder] Fed.Sec.L.Rep. (CCH)
96,906 (C.D.Cal.1992), the court imposed sanctions of the defendant Charles
Keating because 12 of 14 `shotgun' defenses were `patently frivolous.' Sanctions
were also imposed on defendants for filing inappropriate Rule 11 motions;
See Berger v. Iron Workers, 843 F.2d 1395 (D.C. Cir. 1988) (affirming in
part per curiam 7 Fed. Rules Serv. 3d 306 (D.D.C. 1986)); and also for filing
frivolous or harassing counterclaims. See Aetna Insurance v. Meeker,
953 F.2d 1328 (11th Cir. 1992) (affirming district court Rule 11 sanction of
defendants for pursuing frivolous counterclaims of negligent salvage and
conversion). In Swanson v. Sheppard, 445 N.W.2d 654 (N.D.1989), for
example, the court imposed Rule 11 sanctions on the defendant because the
defendant counterclaimed `simply to discourage the plaintiff from continuing
with his cause of action.' Sanctions were imposed on defendants for failing to
conduct a reasonable inquiry into the legal basis for their Rule 12(b)(6) motion
to dismiss. In National Survival Game, Inc. v. Skirmish, U.S.A., Inc.,
603 F. Supp. 339 (S.D.N.Y. 1985), the court sua sponte imposed Rule 11 sanctions
on defendants' counsel on the ground that counsel failed to conduct a reasonable
inquiry into the legal basis for the Rule 12(b)(6) motion to dismiss, stating
`Defendants failed to cite a single case or authority in their two-page
memorandum [in support of the motion]. Apparently, they completely ignored the
firmly established precedents directly contradictory to their position. No doubt
exists that [defendants'] counsel failed to conduct the `reasonable inquiry'
that Rule 11 requires to ensure that a motion `is warranted by existing law or a
good faith argument for the extension, modification or reversal of existing law
. . .' Id. at 341-42. See also Steele v Morris, 608 F. Supp.
274 (S.D.W.Va. 1985) (court granted the plaintiff's motion for Rule 11 sanctions
to be imposed upon the defendant, concluding that the defendant's counsel failed
to make reasonable inquiry into both the facts and the law before filing a
motion to dismiss in this case which alleged, among other things, that the
plaintiff suffered emotional distress due to the defendant's willful,
deliberate, and outrageous conduct). Sanctions were also imposed on defendants
when they were found to have ignored firmly established precedent. In
National Survival Game, Inc. v. Skirmish, U.S.A., Inc., 603 F. Supp. 339,
341-42 (S.D.N.Y. 1985), Rule 11 sanctions were imposed because defendants
`completely ignored the firmly established precedents directly contradictory to
their position.' See also Smith v. United Transp. Union Local 81, 594
F. Supp. 96, 101 (S.D. Cal. 1984) (Rule 11 sanctions imposed where defendants
frivolously maintained suit by ignoring relevant law, relying on irrelevant law,
and basing arguments on vacated cases).]
The bill also expressly provides, in Section 5, that `Nothing in' the changes made to Rule 11 `shall be construed to bar or impede the assertion or development of new claims or remedies under Federal, State, or local civil rights law.' The development of civil rights claims is thereby explicitly protected under the bill's Rule 11 provisions.
H.R. 420 will prevent frivolous lawsuits and help dispel the legal culture of fear that has come to permeate American society.
As Philip Howard has pointed out, due to an onslaught of frivolous lawsuits `[l]egal fear has become a defining feature of our culture.' 2
[Footnote] This values crisis caused by lawsuit abuse reaches all parts of American society:
[Footnote 2: Philip K. Howard, The Collapse of the Common Good: How America's Lawsuit Culture Undermines Our Freedom (2001) at 11.]
Churches
In response to litigation against a church after a parishioner committed suicide, churches have begun implementing policies discouraging counseling by ministers. Instead, parishioners are being referred to secular psychologists and other therapists. 3
[Footnote] According to a recent Newsweek cover story, `The Rev. Ron Singleton's door is always open. That way, when the Methodist minister of a small congregation in Inman, S.C., is counseling a parishioner, his secretary across the hall is a witness in case Singleton is accused of inappropriate behavior. (When his secretary is not around, the reverend does his counseling at the local Burger King.) Singleton has a policy of no hugging from the front; just a chaste arm around the shoulders from the side. And he's developed a lame little hand pat to console the lost and the grieving. The dearth of hugging is `really sad,' he says, but what is he going to do? He could ill afford a lawsuit.' 4
[Footnote]
[Footnote 3: Id. at 32.]
[Footnote 4: Stuart Taylor, Jr. and Evan Thomas, `Civil Wars' Newsweek (December 15, 2003) at 43.]
Schools
A recent poll found that `[n]early 8 in 10 teachers (78%) said students are quick to remind them that they have rights or that their parents can sue.' 5
[Footnote]
[Footnote 5: Public Agenda, `Teaching Interrupted: Do Discipline Policies in Today's Public Schools Foster the Common Good?' (May 2004) at 2-3.]
The Supreme Court's 1975 Goss v. Lopez 6
[Footnote] decision extended Federal due process rights to student discipline and literally made every school discipline decision a potential Federal case. According to Newsweek:
[Footnote 6: 419 U.S. 565 (1975) (holding imposition of suspensions without preliminary hearings violated students' due process rights guaranteed by Fourteenth Amendment).]
`Legal fear' is just as intense in the educational system. Many Americans sense that schools have become chaotic and undisciplined over time and the quality of teachers has declined. Many teachers say that the joy has gone out of their jobs. What's not generally known is the role of courts and Congress in creating these problems by depriving teachers and principals of the freedom to use their own common sense and best judgment. Thanks to judicial rulings and laws over the past four decades, parents can sue if their kids are suspended for even a single day--for any reason--without adequate `due process.' 7
[Footnote]
[Footnote 7: Stuart Taylor, Jr. and Evan Thomas, `Civil Wars' Newsweek (December 15, 2003) at 48.]
Unruly students sense the teachers' fear and their own empowerment. `A kid will be acting out in class, and you touch his shoulder, and he'll immediately come back with `Don't touch me or I'll sue,' or, `You don't have any witnesses,' says Rob Wiel, who taught high-school math and coached football and baseball in the Denver suburbs for 20 years before retiring recently. 8
[Footnote]
[Footnote 8: Id. at 49.]
In New Jersey, `A state judge . . . threw out a lawsuit filed by an Atlantic County man who said assigned seating in a school lunchroom violated his 12-year-old daughter's right to free speech. Superior Court Judge Valerie Armstrong said Galloway Township school administrators had the right to impose the restriction to maintain order and safety in a cafeteria that serves 260 students in each of four 30-minute lunch periods.' 9
[Footnote]
[Footnote 9: John Curran, `Judge Rejects a Rights Suit Over School's Lunch Seating,' The Philadelphia Inquirer (July 20, 2004) at B4.]
According to the St. Petersburg Times:
In Pinellas County [Florida], two Palm Harbor University High School baseball players sued the school district claiming they were wrongly booted from school because of a roughhousing incident that occurred on a team road trip. In Hillsborough County, Robinson High School senior Nicole `Nikki' Youngblood filed suit after her picture was left out of the school yearbook when she refused to wear a feminine drape instead of a shirt and tie as she wished. These two cases only scratch the surface of lawsuits filed against local public school districts on an almost daily basis. More and more, offenses that used to be settled inside the schoolhouse now end up at the courthouse. The result, educators say, is less money for learning. `We spend millions and millions on attorney fees every year that has nothing to do with the classroom,' said Wayne Blanton, executive director of the Florida School Boards Association. `Every lawsuit we have to defend is money that doesn't get to the classroom.' . . . `Lots of people file suit,' said Crosby Few, Hillsborough School Board attorney. `A lot of them are frivolous.' . . . In the book, Judging School Discipline: The Crisis of Moral Authority, the authors argue that the hundreds of lawsuits challenging school disciplinary procedures have hurt the quality of public education. One of the authors, Richard Arum, an associate professor of sociology at New York University, said just the threat of lawsuits keeps teachers from taking charge of their classrooms. 10
[Footnote]
[Footnote 10: Melanie Ave, `Lawsuits Drain School Dollars' St. Petersburg Times (February 2, 2004) (emphasis added).]
And as the Arizona Republic has reported:
Scottsdale School Board member Christine Schild has called the legal fees `outrageous.' . . . Legal bills for the 2003-04 school year are estimated to be as high as $675,000. This is the highest amount in recent years, and possibly ever . . . Large school districts routinely spend thousands of dollars each year on attorneys. The most common expenses are for student expulsion hearings and employee discipline . . . [D]ay-to-day legal expenses involving disputes with employees and student discipline are not covered by insurance and come out of the operating budget. 11
[Footnote]
[Footnote 11: Anne Ryman, `Baracy to Pick In-house Attorney for School District,' The Arizona Republic (July 8, 2004) at 1.]
Thanks to frivolous lawsuits, `in America, hugging or, indeed, even a pat on the back is now considered so dangerous that teachers can't do it.' 12
[Footnote] According to Lynn Maher of the New Jersey chapter of the National Education Association (`NEA'), `Our policy is basically don't hug children.' 13
[Footnote] The guidelines of the Pennsylvania chapter of the NEA urge teachers to do no more than `briefly touch' a child's arm or shoulder. 14
[Footnote]
[Footnote 12: Philip K. Howard, The Collapse of the Common Good: How America's Lawsuit Culture Undermines Our Freedom (2001) at 5.]
[Footnote 13: Id. at 5.]
[Footnote 14: Id. at 5.]
Salon.com has chronicled the threat frivolous lawsuits pose to a successful program designed to get children to exercise more by walking or bike riding to school. According to Salon.com:
[A] new program is rising to the top in the bike-walk hierarchy. It's called Safe Routes to School, a rapidly expanding 4-year-old effort that coordinates transportation, health and education agencies to get children walking and biking to school. Statewide Safe Routes programs are already underway in California, Washington and Wisconsin, and the pending reauthorization of the highway and transit bill, TEA-3, contains a $1 billion appropriation for a Federal Safe Routes to School program.
`It has the potential to become one of the best ways to improve conditions for walking and biking,' said Clark, describing the broad cross-section of Safe Routes supporters, including parents, including parents and teachers, health agencies and urban planners. `There's an unassailable coalition.'
Sharon Roerty, director of community programs at the National Center for Bicycling and Walking in Bethseda, Md., concurs. `Safe Routes to School means a better walking and biking environment for everyone,' she said. `We picked schools because that's a motherhood and apple pie. But it could be a senior center; it could be a train station.'
But if Safe Routes to School is a case study in successful grass-routes organizing, the story behind it also unfolds as a classic--and damning--parable of contemporary American culture .. . . Wendi Kallins, project manager for the Marin County SR2S program, which has become a national model for the burgeoning movement, says parents routinely cite safety as the main reason they prevent their kids from walking or biking to school. But more often than not, parents' safety arguments are like falling down the rabbit hole; plunge deeper, and it gets curiouser and curiouser. Fifty percent of the children hit by cars near schools are hit by vehicles driven by parents of other students, according to the National Highway Traffic Safety Administration. Researchers for the Marin County program found that up to 30 percent of morning traffic is caused by parents driving their children to school. (These figures have since been validated in other parts of the country.) . . .
Fast forward to the 21st century, where liability insurance for kids who walk or bike to school has become one of the major challenges facing SR2S advocates. In 2002, the Environmental Protection Agency funded a $96,000 Portland project to develop a Walking School Bus--in which groups of kids walk designated routes to school under adult supervision--at a local elementary school. Organizers spent months mapping safe routes, conducting outreach to parents, and running criminal background checks on senior citizens volunteers, only to have the project collapse in the absence of liability coverage for kids who might become injured or go missing. A senior-citizen-led walking school bus in Larkspur, Calif. Met with a similar fact, according to Kallins.
`The fact that one would have to even consider kindly senior citizens being sued for walking kids to school says a lot about out culture,' she observed. 15
[Footnote]
[Footnote 15: Linda Baker, `Walk to School, Yes, But Don't Forget Your Lawyer,' Salon.com (October 13, 2004).]
Doctor's Offices
According to Newsweek:
Dr. Sandra R. Scott of Brooklyn, N.Y., has never been sued for malpractice, but that doesn't keep her from worrying. As an emergency-room doctor, she often hears her patients threaten lawsuits--even while she's treating them. `They'll come in, having bumped their heads on the kitchen cabinet, and meanwhile I'll be dealing with two car crashes,' she says. `And if they don't have the test they think they should have in a timely fashion, they'll get very angry. All of a sudden, it's `You're not treating me, this hospital is horrible, I'm going to sue you.' 16
[Footnote] `I'm only a human being,' she says. `I'm an educated physician but the miracles are out of my hands.' 17
[Footnote]
[Footnote 16: Stuart Taylor, Jr. and Evan Thomas, `Civil Wars' Newsweek (December 15, 2003) at 43-44.]
[Footnote 17: Id. at 51.]
When Dr. Brian Bachelder moved back to Mt. Gilead, Ohio, to practice family medicine in 1984, he hoped to emulate the country doc who'd treated him as a kid . . . But in recent years, Bachelder, 49, has watched litigation reshape his practice. Last December, facing malpractice premiums that soared from $12,000 in 2000 to $57,000 in 2003, Bachelder decided to lower his bill by cutting out higher-risk procedures like vasectomies, setting broken bones and delivering babies--even though obstetrics was his favorite part of the practice . . . Today the threat of litigation hangs over nearly every move Bachelder makes, changing the very nature of his relationship with patients. He worries that the slightest mistake could provoke a lawsuit. `Anything less than perfection is malpractice,' he says. Even in confronting the most common ailments--headaches or ear infections--Bachelder must consider the possibility of a rare and devastating disease. He often orders expensive tests--not just to rule out the worst, but also to bolster his case before a potential jury . . . Bachelder's fear of lawsuits isn't just theoretical--he's been sued a half-dozen times in his 20-year career. In one case, Bachelder referred a boy with a bladder problem to a urologist. The urologist operated, and the patient subsequently sued; Bachelder was also named in the complaint. He was eventually dropped from the case, but not before his liability insurance paid out $40,000 in legal fees. 18
[Footnote]
[Footnote 18: Debra Rosenberg, `Hard Pill to Swallow' Newsweek (December 15, 2003) at 46.]
The most dangerously incompetent doctors often remain in place for many years, in part because employers fear wrongful-dismissal lawsuits by fired doctors even more than malpractice suits by their victims. 19
[Footnote]
[Footnote 19: Stuart Taylor, Jr. and Evan Thomas, `Civil Wars' Newsweek (December 15, 2003) at 48.]
Sports
The New Yorker reports on how diving boards and U.S. Olympic diving medals have both become a thing of the past due to frivolous lawsuits: `After a golden age in the seventies . . . the American pool has suffered a gradual decline: thanks, for the most part, to concerns about safety and liability, diving boards have been removed and deep ends undeepened. . . . Such developments have consequences. . . . In the last two Olympics, medal counts for [once-dominant] American divers reached their lowest levels since the 1912 Games.' 20
[Footnote]
[Footnote 20: Field Maloney, `Cannonball!' New Yorker, Talk of the Town (September 8, 2004).]
According to Newsweek:
Ryan Warner is a volunteer who runs an annual softball tournament in Page, Ariz., that usually raises about $5,000 to support local school sports programs. But not this year. A man who broke his leg at a recent tournament sliding into third base filed a $100,000 lawsuit against the city, and Warner fears he may be named as a defendant. `It's very upsetting when you're doing something for the community, not making any money for yourself, to be sued over something over which you had no control,' he says. So Warner canceled the tournament. 21
[Footnote]
[Footnote 21: Id. at 44.]
Parents, on behalf of their children, increasingly sue not only for physical injuries, but for `hurt feelings' when they don't make a team, says John Sadler of Columbia, S.C., who insures amateur sports leagues .. If a ref steps into a fight, he can be sued if one of the players he is holding back takes a punch. If the ref doesn't intervene, he can be sued for allowing the fight to go on. 22
[Footnote]
[Footnote 22: Id. at 49.]
Even apparently innocent soccer moms are at risk. In Jupiter, Fla., one mother volunteered to pick up a pizza for the team. She drove over the foot of a child who, left unattended, had run into the road. The police did not even give the woman a ticket. But the parents of the child sued the mother and the soccer league and tried to sue the city, the refs and various sponsors. 23
[Footnote]
[Footnote 23: Id. at 49.]
Other examples include the following. In Vestavia Hills, Alabama, the father of Laura Brooke Smith `sued [the] school district, saying his daughter's rejection from the high school cheerleading squad despite professional coaching has caused her humiliation and mental anguish.' 24
[Footnote]
[Footnote 24: Fox News (May 31, 2001).]
In North Haven, Connecticut, the `families of two high school sophomores have filed a Federal lawsuit over the school's decision to drop them from the drum majorette squad.' 25
[Footnote]
[Footnote 25: Ann DiMatteo, `Families Sue Over Unfair Twirl Tryouts,' The New Haven Register, May 18, 2001.]
A student was barred from participating in her high school's cheerleading tryouts `as punishment for passing a profane note on a . . . school bus in 2003.' In response, her father hired a lawyer and filed a lawsuit `saying the punishment violated his daughter's constitutional rights.' An appeals court dismissed the lawsuit, agreeing with school officials that students `do not have a constitutional right to participate in extra-curricular activities.' 26
[Footnote]
[Footnote 26: Kelly Melhart, `Court Dismisses Suit over Punishment,' Fort Worth-Star Telegram (April 19, 2005).]
And in Pennsylvania, `[a] teenager, who felt she was destined for greatness as a softball player, has filed a $700,000 lawsuit against her former coach, alleging his `incorrect' teaching style ruined her chances for an athletic scholarship.' 27
[Footnote]
[Footnote 27: Dave Sommers, `Legal Pitch,' The Trentonian, May 1, 2001.]
ABC News reports that:
When his 16-year-old son didn't get the most valuable player award, Michel Croteau didn't get upset. He hired a lawyer and sued his son's youth hockey league to the tune of more than $200,000 . . . The Croteaus are not alone. In the last year, parents have filed more than 200 non-injury-related sports lawsuits against coaches, leagues and school districts in the United States, according to Gil Fried, a University of New Haven professor who specializes in sports law . . . The Butzke family sued the Comsewogue, N.Y., school district because their eighth-grade daughter was taken off the varsity high school soccer team. The Branco family took legal action against the Washington Township, N.J., school district after their son, David, was cut from the junior varsity basketball team . . . The Rubin family sued California's New Haven Unified School District for $1.5 million because their son got kicked off the varsity basketball team . . . The family felt James Logan High School Coach Blake Chong may have cost their son not just a scholarship, but an NBA career.' 28
[Footnote]
[Footnote 28: ABCNews.com Report, `Blame the Coach? Angry Parents Take School Coaches to Court' (August 7, 2003).]
In 1999, even major league baseball issued a directive to players that they should no longer throw foul balls to eager fans in the stands because there might be a lawsuit if someone got hurt trying to recover a souvenir. 29
[Footnote] Yet another lawsuit was filed against Major League Baseball for injuries resulting from being hit by a practice ball before Game One of the 2000 World Series. 30
[Footnote]
[Footnote 29: Philip K. Howard, The Collapse of the Common Good: How America's Lawsuit Culture Undermines Our Freedom (2001) at 46.]
[Footnote 30: Zach Haberman, `Fan Blinded by Ball Sues Yanks for $5M,' The New York Post (April 11, 2005).]
Playgrounds
The lawsuit culture is even changing the traditional American landscape: playgrounds are increasingly removing seesaws for fear of liability. 31
[Footnote] According to Newsweek:
[Footnote 31: Id. at 3.]
Playgrounds all over the country have been stripped of monkey bars, jungle gyms, high slides and swings, seesaws and other old-fashioned equipment once popularized by President John F. Kennedy's physical-fitness campaign. The reason: thousands of lawsuits by people who hurt themselves at playgrounds. But some experts say that new, supposedly safer equipment is actually more dangerous because risk-loving kids will test themselves by, for instance, climbing across the top of a swing set. Other kids sit at home and get fat--and their parents sue McDonald's. 32
[Footnote]
[Footnote 32: Stuart Taylor, Jr. and Evan Thomas, `Civil Wars' Newsweek (December 15, 2003) at 44.]
As Philip Howard has written, `just letting a claim go to a jury . . . will affect whether seesaws stay in playgrounds all across America.' 33
[Footnote]
[Footnote 33: Philip K. Howard, The Collapse of the Common Good (New York: 2001) at 58.]
Today, a brochure from the National Program for Playground Safety advises: `Seesaw use is quite complex because it requires two children to cooperate and combine their actions,' and now `there is a trend to replace [them] with spring-centered seesaws.' 34
[Footnote] A culture of legal fear is actually reducing the opportunities of American children to burn calories in playgrounds.
[Footnote 34: U.S. Consumer Product Safety Commission, Handbook for Public Playground Safety, Pub. No. 325 at 23.]
Good Deeds
According to the Chicago Daily Herald:
By day, Dave Peterson works with diagnostic multiplexers and beam shakers to maintain the Fermi National Accelerator Laboratory's antiproton source. But at dawn and dusk the Geneva resident drags a homemade snowplow behind his daughter's Pacific Electra mountain bike, clearing a 16-inch wide section of the Fox River Trail as he rides to and from work in Batavia. Because he rides at a time when few are watching, he's become something of a local legend the last two winters, a Bigfoot. `It's one of those weird things that has touched a nerve with a lot of people,' Peterson said. A whole lot. In fact, many of the path's regulars have come to expect it to be clear--and that has put Peterson's plowing on hiatus. The county has asked him to stop because if there's an expectation that the trail will be plowed, there's a greater chance for litigation, said Kane County Forest Preserve District operations supervisor Pat McQuilkin. `If a person falls, you are more liable than if you had never plowed at all. Crazy world,' wrote AnnMarie Fauske, the district's community affairs director, in response to a letter to Peterson. `Unfortunately, the times we are in allow for a much more litigious environment than common sense would dictate.' . . . `There is something I can do here,' Peterson said. `I can use my skills as an engineer to make life easier for the little old ladies who walk on the path.' But the forest preserve worries that if they take a wrong step and fall, those little old ladies might decide to sue. 35
[Footnote]
[Footnote 35: Garrett Ordower, `County Tells Bicyclist Thanks, But Stop Plowing Trail,' The Chicago Daily Herald (February 21, 2004).]
The Girl Scouts
The Girl Scouts in Metro Detroit alone have to sell 36,000 boxes of cookies each year just to pay for liability insurance. 36
[Footnote] According to former Girl Scout Laurie Super [of Downington, Pennsylvania], `[i]t's getting harder to sell [cookies] . . . Our local Wawa stores said they couldn't let the girls set up their booth anymore, because of liability issues.' 37
[Footnote]
[Footnote 36: See `Fine Filers of Frivolous Lawsuits,' The Detroit News (February 24, 2004).]
[Footnote 37: Julia Moskin, `Crave Thin Mints?' The New York Times (March 14, 2004).]
Santa Clause
Even Santa Claus lives under a constant threat of legal harassment. As the Los Angeles Times quoted one Santa Claus, `When I started doing this years ago, I never even thought about liability . . . But Santas have a pretty good chance of getting sued . . .' 38
[Footnote]
[Footnote 38: J.R. Moehringer, `Ho! Ho! Is More Like Uh-Oh,' The Los Angeles Times (December 23, 2004).]
Everyone
The corrosive effects of lawsuit abuse were recently summarized by Newsweek:
Americans will sue each other at the slightest provocation. These are the sorts of stories that fill schoolteachers and doctors and Little League coaches with dread that the slightest mistake--or offense to an angry or addled parent or patient--will drag them into litigation hell, months or years of mounting legal fees and acrimony and uncertainty, with the remote but scary risk of losing everything . . . Americans don't just sue big corporations or bad people. They sue doctors over misfortunes that no doctor could prevent. They sue their school officials for disciplining their children for cheating. They sue their local governments when they slip and fall on the sidewalk, get hit by drunken drivers, get struck by lightning on city golf courses--and even when they get attacked by a goose in a park (that one brought the injured plaintiff $10,000). They sue their ministers for failing to prevent suicides. They sue their Little League coaches for not putting their children on the all-star team. They sue their wardens when they get hurt playing basketball in prison. They sue when their injuries are severe but self-inflicted, when their hurts are trivial and when they have not suffered at all. Many of these cases do not belong in court. But clients and lawyers sue anyway, because they hope they will get lucky and win a jackpot from a system that allows sympathetic juries to award plaintiffs not just real damages--say, the cost of doctor's fees or wages lost--but millions more for impossible-to-measure `pain and suffering' and highly arbitrary `punitive damages.' (Under standard `contingency fee' arrangements, plaintiffs' lawyers get a third to a half of the take.) . . . Many Americans sue because they have come to believe that they have the `right' to impose the costs and burdens of defending a lawsuit on anyone who angers them, regardless of fault or blame. The cost to society cannot be measured just in money, though the bill is enormous, an estimated $200 billion a year, more than half of it for legal fees and costs that could be used to hire more police or firefighters or teachers. 39
[Footnote]
[Footnote 39: Stuart Taylor, Jr. and Evan Thomas, `Civil Wars' Newsweek (December 15, 2003) at 44-45.]
[T]he time may come when ordinary Americans recognize that for every sweepstakes winner in the legal lottery, there are millions of others who have to live with the consequences--higher taxes and insurance rates, educational and medical systems seriously warped by lawsuits, fear and uncertainty about getting sued themselves. 40
[Footnote]
[Footnote 40: Id. at 51. Although the American Trial Lawyers Association has vociferously attacked the Newsweek article, Newsweek stands solidly by its report, stating `NEWSWEEK received a large volume of mail from trial lawyers critical of our cover story. We stand by the story as both accurate and fair. The criticisms are for the most part easily refuted with material in the public record.' Newsweek, `Mail Call' (January 12, 2004).]
As Will Rogers once observed, Americans are `letting lawyers instead of their conscience be their guide.'
We all pay for these frivolous lawsuits through higher prices as consumers and through higher taxes as taxpayers.
A recent poll found that 83% of likely voters believe there are too many lawsuits in America, 76% believe lawsuit abuse results in increased prices for goods and services, and 65% said they would be more likely to vote for congressional candidates who supported curbs on lawsuit abuse. 41
[Footnote] Another poll found that 73% of Americans support requiring sanctions against attorneys who file frivolous lawsuits. 42
[Footnote]
[Footnote 41: See American Tort Reform Association, `National Poll on Tort Reform' (February 27, 2003).]
[Footnote 42: See Insurance Research Council, `IRC Study Finds Strong Support for Wide Variety of Civil Justice Reform Measures' (April 5, 2004) at 4.]
Small businesses rank the cost and availability of liability insurance as second only to the costs of health care as their top priority, 43
[Footnote] and both problems are fueled by frivolous lawsuits.
[Footnote 43: Bruce D. Phillips, `Small Business Problems and Priorities' (National Federation of Independent Business Research Foundation, June 2004).]
When Business Week wrote an extensive article on what the most effective legal reforms would be, Business Week stated that what's needed is `Penalties That Sting.' As Business Week recommends, `Give judges stronger tools to punish renegade lawyers. Before 1993, it was mandatory for judges to impose sanctions such as public censures, fines, or orders to pay for the other side's legal expenses on lawyers who filed frivolous lawsuits. Then the Civil Rules Advisory Committee (CRAC), an obscure branch of the courts, made penalties optional. This needs to be reversed . . . by Congress.' 44
[Footnote]
[Footnote 44: Mike France, `Special Report--Tort Reform: How to Fix the Tort System,' Business Week (March 14, 2005) at 76.]
The Class Action Fairness Act, which recently became law, 45
[Footnote] prohibits forum shopping when the case is styled as a class action. The same policy should apply to individual lawsuits as well, and LARA would fill that gap in policy. As The Wall Street Journal said in a recent editorial, `One suggestion is blending class action reform with the Lawsuit Abuse Reduction Act (LARA), a related measure that also passed the House last year. LARA would also reduce forum shopping and frivolous personal injury claims and fine lawyers who bring them.' 46
[Footnote]
[Footnote 45: Public Law No. 109-2.]
[Footnote 46: `Tort Reform Roadmap,' The Wall Street Journal (editorial) (January 27, 2005) at A12.]
Because existing rules against frivolous lawsuits are ineffective, as one commentator has pointed out, `The right to sue has been exploited by lawyers. They can gamble on taking cases on a contingency basis because they need only win 1 in 10 to score the big judgment that will make up for the other losses.' 47
[Footnote]
[Footnote 47: Mortimer B. Zuckerman (Editorial) `Welcome to Sue City, U.S.A.' U.S. News & World Report (June 16, 2003) at 64.]
Small businesses and workers suffer. This year, the nation's oldest ladder manufacturer, family-owned John S. Tilley Ladders Co. of Watervliet, New York, near Albany, filed for bankruptcy protection and sold off most of its assets due to litigation costs. Founded in 1855, the Tilley firm could not handle the cost of liability insurance, which had risen from 6% of sales a decade ago to 29%, even though the company never lost an actual court judgment. `We could see the handwriting on the wall and just want to end this whole thing,' said Robert Howland, a descendant of company founder John Tilley. 48
[Footnote]
[Footnote 48: Carrie Coolidge, `The Last Rung; The Tort System Takes Down a 149-year-old Ladder Manufacturer,' Forbes (January 12, 2004) at 52.]
A recent report by the AEI-Brookings Joint Center for Regulatory Studies has concluded that `The tort liability price tag for small businesses in America is $88 billion a year' and that `Small businesses bear 68 percent of business tort liability costs, but take in only 25% of business revenue.' 49
[Footnote] The small businesses studied in the report account for 98% of the total number of businesses with employees in the United States. 50
[Footnote]
[Footnote 49: Judyth Pendell and Paul Hinton, `Liability Costs for Small Business' (U.S. Chamber Institute for Legal Reform, June, 2004) at 1 (`small business' defined as `those with less than $10 million in annual revenue and at least one employee in addition to the owner').]
[Footnote 50: Id.]
As Bernie Marcus, co-founder and former chairman of The Home Depot, has described, `An unpredictable tort system casts a shadow over every plan and investment. It is devastating for start-ups. The cost of even one ill-timed abusive lawsuit can bankrupt a growing company and cost hundreds of thousands of jobs. CEOs and their boards are forced to lower their aspirations and hold back on innovations to manage defensively. This is holding our nation back from competing effectively in the global marketplace and offshore competition is seriously cutting into market share for U.S. companies.' 51
[Footnote]
[Footnote 51: Washington Legal Foundation, `Conversations With . . .' (Fall 2004).]
Doctors and patients suffer. Before the 1960s, only one physician in seven had ever been sued in their entire lifetime, 52
[Footnote] whereas today's rate is about one in seven physicians sued per year. 53
[Footnote]
[Footnote 52: See `Opinion Survey of Medical Professional Liability,' JAMA 164:1583-1594 (1957).]
[Footnote 53: See R. Bovbjerg, `Medical Malpractice: Problems & Reforms,' The Urban Institute, Intergovernmental Health Policy Project (1995).]
Further, the Harvard Medical Practice Study found that over half of the filed medical professional liability claims they studied were brought by plaintiffs who suffered either no injuries at all, or, if they did, such injuries were not caused by their health care providers, but rather by the underlying disease. 54
[Footnote] The researchers found that, of the 47 medical malpractice claims they studied that resulted in litigation, 55
[Footnote] `[i]n 14 cases, the physicians reviewed the record and found no adverse event. For most of these cases, the physicians examined the outcome and concluded that the cause was the underlying disease rather than medical treatment . . . In these 14 cases, our physician reviewers took a stand opposite to that of the plaintiff-patient's expert.' 56
[Footnote] Further, the reviewers found that in an additional 10 cases an adverse event occurred, but there was no negligence on the part of the health care provider. 57
[Footnote] Of the 47 claims filed that the researchers analyzed, less than half demonstrated any actual negligence, and many demonstrated no discernable injury. 58
[Footnote]
[Footnote 54: See Harvard Medical Practice Study to the State of New York, Patients, Doctors, and Lawyers: Medical Injury, Malpractice Litigation, and Patient Compensation in New York at 11-5 (1990) (`[T]he tort system imposes the costs of defending claims on [health care] providers who may not even have been involved in an injury, let alone a negligent injury.').]
[Footnote 55: See id. at 7-1.]
[Footnote 56: See id. at 7-33.]
[Footnote 57: See id. at 7-33.]
[Footnote 58: See also Paul Weiler, et al., A Measure of Malpractice (1993) at 71 (`[Of those 47,] 10 claims involved hospitalization that had produced injuries, though not due to provider negligence; and another three cases exhibited some evidence of medical causation, but not enough to pass our probability threshold. That left 26 malpractice claims, more than half the total of 47 in our sample, which provided no evidence of medical injury, let alone medical negligence.').]
Here are just a few examples of the frivolous lawsuits that have tormented innocent Americans. 59
[Footnote]
[Footnote 59: Recently, Britain's most senior judges, the Appellate Committee of the House of Lords, branded Britain's U.S.-style claims system an `evil' that interferes with civil liberties and freedom in a landmark ruling in a compensation case. In the case of Tomlinson v. Congleton Borough Council, [2003] U.K.H.L. 47 (2003), the Appellate Committee stated `The pursuit of an unrestrained culture of blame and compensation has many evil consequences and one is certainly the interference with the liberty of the citizen. Of course there is some risk of accidents arising out of the joie de vivre of the young, but that is no reason for imposing a grey and dull safety regime on everyone.']
ÌAccording to Reuters, `A lawsuit against . . . U.S. weather forecasters . . . over the South Asian tsunami disaster is fueling calls for greater curbs on what critics say are frivolous cases brought by lawyers out to make a quick buck. The suit, brought on behalf of a group of tsunami victims, `perfectly illustrates' the need for U.S. laws to hold lawyers liable for the economic damages they inflict on those they sue, said legal scholar Lester Brickman.' 60
[Footnote] The petition was filed in Federal court in Manhattan. 61
[Footnote]
[Footnote 60: Gail Appleson, `Tsunami Suit Shows Need to Curb Lawyers, Critics Say,' Reuters (March 8, 2005).]
[Footnote 61: Id.]
ÌAustin Aitken filed a lawsuit against NBC's `Fear Factor' television program. Austin Aitken told the Associated Press that he watches `Fear Factor' often and had no problem with past installments in which the reality show's participants ate worms and insects in pursuit of a $50,000 prize--but eating rats went `too far.' Aitken says he became `dizzy and lightheaded' and vomited after watching contestants eat rats. He also ran into a doorway because he was disoriented, `causing suffering, injury and great pain.' Aitken's lawsuit asks for $2.5 million as compensation. `I just put any figure,' he told the Associated Press. 62
[Footnote]
[Footnote 62: `Viewer Sues NBC Over Rat-Eating Fear Factor,' Associated Press (January 6, 2005).]
ÌU.S. District Judge Loretta Preska had to say about the current state of Federal litigation: `Plaintiffs here have lost their way; they need to consult a map or a compass or a Constitution because Plaintiffs have come to the judicial branch for relief that may only be granted by the legislative branch. This action is one of dozens of similar bootless actions filed in twenty-three district courts across the United States on behalf of uninsured and indigent patients, wherein Plaintiffs argue, without basis in law, that private non-profit hospitals are required to provide free or reduced-rate services to uninsured persons . . . This orchestrated assault on scores of nonprofit hospitals, necessitating the expenditure of those hospitals' scares resources to beat back meritless legal claims, is undoubtedly part of the litigation explosion that has been so well-documented in the media . . . For the foregoing reasons, the Defendants' motions to dismiss the above-captioned actions are granted in their entirety with prejudice. The Clerk of the Court shall mark these actions closed and all pending motions denied as moot.' 63
[Footnote]
[Footnote 63: Kolari v. New York-Presbyterian Hospital, 2005 WL 710452 (S.D.N.Y.), at *1-*2, *14.]
ÌBarbara Streisand sued the California Coastal Records Project, which took thousands of pictures of the California coastline intended to protect the state's shoreline. The photographs are made available free of charge to state and local governments, university researchers, conservation organizations, and others. Streisand sued because a picture of her Malibu estate (her mansion composed only 3% of one photo among thousands) was posted on the public interest organization's Web site. She sued for $50 million (five separate claims for $10 million each), but on May 10, 2004, Streisand was ordered to pay the people she sued $154,000 in legal fees they accrued defending against her ridiculous lawsuit. 64
[Footnote]
[Footnote 64: See Jennifer Pittman, `The Blame Game' The Silicon Valley/San Jose Business Journal (January 9, 2004); Kenneth R. Weiss, `Streisand Sues Over Photograph of Her Coast Home on Web Site,' The Los Angeles Times (May 30, 2003) at B1; Streisand v. Adelman, Case No. SC077257 (Sup. Ct. Los Angeles Cty.) (complaint filed May 30, 2003); Streisand v. Adelman, Case No. SC077257 (Sup. Ct. Los Angeles Cty.) (ruling on submitted matters: Motion to Tax Costs and Motion for Attorneys; Fees).]
ÌAccording to the Indianapolis Star, `Indiana drivers who get into wrecks with someone who is talking on a cell phone can forget about suing the phone's manufacturer. The Indiana Court of Appeals on Friday dismissed an Evansville lawsuit in which Terry L. Williams tried to do just that after a March 2002 traffic crash. Williams collided with Kellie Meagher, who was allegedly talking on a Cingular Wireless phone. In the lawsuit, Williams alleged Cingular knew--or should have known--that Meagher would use the phone while driving. Vanderburgh Superior Court Judge Mary Margaret Lloyd dismissed Cingular from the suit. After the dismissal, Williams asked the judge to reconsider, citing new evidence that included a `Blondie' cartoon strip in which Blondie, while talking on a cell phone, caused an accident. But the Evansville judge was unmoved. Now an appellate court also agrees that Cingular was not liable.' 65
[Footnote]
[Footnote 65: Kevin Corcoran, `Court: Don't Blame Cell-Phone Maker for Crash,' The Indianapolis Star (June 5, 2004).]
ÌIn April, 1995, Carl and Diana Grady sued Frito Lay claiming that Dorito chips stuck in Charles Grady's throat and tore his esophagus. The Gradys wanted to present the `expert' testimony of Dr. Charles Beroes to support their claim that Doritos are inherently dangerous and negligently designed. Beroes' research included pressing Doritos onto a scale until the tip snapped off, and measuring the amount of time it took saliva to soften the Doritos. None of Beroes' tests involved chewing. After eight years of costly litigation, the Pennsylvania Supreme Court threw out the case, noting that Dr. Beroes' tests `smacked of a high school science fair project and did not bear any relationship to the reality of the . . . consumption of foodstuffs.' 66
[Footnote] Justice Saylor pointed out in his concurring opinion `the common sense notion that it is necessary to properly chew hard foodstuffs prior to swallowing.' 67
[Footnote]
[Footnote 66: Grady v. Frito-Lay, Inc., 839 A.2d 1038, 1042 (8th Cir. 2003) (citing Grady v. Frito-Lay, Inc., 2000 WL 33436367, at *2) (Pa.Com.Pl. April 3, 2000)).]
[Footnote 67: Id. at 1053 (Saylor, J., concurring).]
ÌAfter three years of litigation, an appeals court finally held that the survivor of a crash cannot sue an airline for punitive damages when the pilots did not intentionally crash the plane. At midnight on June 1, 1999, during a severe thunderstorm, a fully loaded American Airlines jet crashed while trying to land in Little Rock, Arkansas. Eleven people died, including the pilot. Two passengers sued seeking compensatory and punitive damages. A U.S. district court judge ruled that `uncontroverted evidence' showed the pilots had a good faith belief that the plane could be landed safely. 68
[Footnote] Upholding the district court's decision, Judge Morris Arnold held that no reasonable jury could find that the members of the flight crew crashed the plane on purpose. Judge Morris wrote, `[s]tated differently, we hold that no reasonable jury could find that the members of the flight crew knew, or ought to have known, in light of the surrounding circumstances, that their conduct would naturally and probably result in injury.' 69
[Footnote]
[Footnote 68: In re: Aircraft Accident at Little Rock, Arkansas on June 1, 1999, 231 F.Supp. 852, 879 (E.D.Ark. 2002).]
[Footnote 69: Id. at 878-79.]
ÌAfter five years of litigation, the Nevada Supreme Court dismissed the appeal of Lane Holmes, who sued the Turtle Stop in Las Vegas, claiming a cup caused him to suffer leg burns from dripping hot coffee. 70
[Footnote] The court upheld the decision of the trial court that ruled `[t]he danger is open and obvious.' 71
[Footnote]
[Footnote 70: Holmes v. Turtle Stop, Inc., 62 P.3d 1165 (2000).]
[Footnote 71: Cy Ryan, `Court Says Warning About Hot Coffee Unnecessary,' The Las Vegas Sun (July 11, 2000).]
ÌA woman in Knoxville, Tennessee, sought $125,000 in damages against McDonald's, claiming a hot pickle dropped from a hamburger, burning her chin and causing her mental injury. Her husband also sued for $15,000 for loss of consortium. 72
[Footnote]
[Footnote 72: See Randy Kenner, `Lawsuit on Hot Pickle Draws Attention Around the Globe,' Knoxville News-Sentinel (October 10, 2000) at A1.]
ÌOn September 3, 2003, a Federal district judge in New York threw out for a second time a lawsuit filed on behalf of obese children claiming McDonald's Corporation was legally responsible for their over-consumption of food. 73
[Footnote] The court earlier noted the national ramifications of the complaint and the requested damages, stating `McDonalds has also, rightfully, pointed out that this case, the first of its kind to progress far enough along to reach the stage of a dispositive motion, could spawn thousands of similar `McLawsuits' against restaurants . . . The potential for lawsuits is even greater given the numbers of persons who eat food prepared at other restaurants in addition to those serving fast food.' 74
[Footnote]
[Footnote 73: See Pelman v. McDonald's Corp., S.D.N.Y. 02 Civ. 7821 (RWS), at 34-35 (September 3, 2003).]
[Footnote 74: Pelman v. McDonald's Corp., 237 F.Supp.2d 512, 518 (S.D.N.Y. 2003).]
ÌThe Michigan Court of Appeals threw out a case brought by Richard Overton, who `pointed to defendant's television advertisements featuring Bud Light as the source of fantasies coming to life, fantasies involving tropical settings, and beautiful women and men engaged in unrestricted merriment. Plaintiff sought monetary damages in excess of $10,000, alleging that defendant's misleading advertisements had caused him physical and mental injury, emotional distress, and financial loss.' 75
[Footnote]
[Footnote 75: Overton v. Anheauser-Busch Co., 517 N.W.2d 308, 309 (Mich. App. 1994).]
ÌIn Florida, a woman sued Universal Studios for $15,000 for `extreme fear, emotional distress and mental anguish' because the theme park's annual haunted house was too scary. 76
[Footnote]
[Footnote 76: Tim Barker, `Universal Fall Leads to Lawsuit,' Orlando Sentinel (January 5, 2000) at C1.]
ÌAfter over three years of litigation, Georgia's Court of Appeals held that the day trading firms where Mark Barton invested before embarking on a shooting rampage are not liable for the victims' injuries and deaths. A unanimous panel on the court stated `We find this case is one in which the issue of proximate cause is so plain, palpable and indisputable as to demand summary judgment for the defendants.' 77
[Footnote] The court noted that it was `troubled by the implication that the list of defendants potentially liable for any person's violence, if sparked by economic misfortune, would be limited only by the number of stock brokers, investment advisers, lawyers, business partners, lottery ticket sellers, etc., whom the assailant blamed for his financial losses.' 78
[Footnote]
[Footnote 77: Brown v. All-Tech Investment Group, 2003 WL 23315394 (Ga. App.) at *5.]
[Footnote 78: Id. at *7, n.5.]
ÌAfter a decade of litigation, Texas' 1st Court of Appeals reversed a $43 million judgment against a car manufacturer in a products liability suit that alleged a defective seat belt caused the 1992 drowning death of a woman with a blood-alcohol level of 0.17 who failed to escape from her Honda Civic when it became submerged under water. 79
[Footnote]
[Footnote 79: Honda of America Manufacturing, Inc. v. Norman, 104 S.W.3d. 600 (2003) (Tex.App. 1st.).]
ÌThe family of a man who died on a fishing trip sued the Weather Channel for $10 million, claiming that the man relied on the channel's forecast for his safety. In dismissing the case, the Miami Federal court stated that if forecasters were held accountable, `the duty could extend to farmers who plant their crops based on a forecast of no rain, construction workers who pour concrete or lay foundation based on the forecast of dry weather, or families who got to the beach for the weekend.' 80
[Footnote]
[Footnote 80: See `Storm Death Is Not Weatherman's Fault,' New York Post (March 29, 1999) at 84.]
ÌA West Virginia man who fell down an escalator at an airport finally dropped a lawsuit filed against US Airways over the accident. According to the Associated Press, `The lawsuit in circuit court in Fort Myers alleged the airline didn't warn Floyd Shuler, 61, about the adverse affects of drinking alcohol on a plane. Shuler said in a news release from Wheeling, W.Va., that he didn't intend for the suit to be filed. `I learned about the filing of the lawsuit against US Airways . . . along with everyone else,' Shuler said. `It was never my intent to take on the airline industry. I apologize for any inconvenience this has caused US Airways.' Shuler's attorney, Paul Kutcher, did not return a phone call from The Associated Press seeking comment. The suit . . . said US Airways was negligent by failing to warn Shuler that the effects of alcohol are greater at night on airline passengers. The suit also alleged that the company did not properly maintain the escalator at Southwest Florida International Airport when he fell down it on Aug. 28, 1999, and it sought damages in excess of $15,000.' 81
[Footnote]
[Footnote 81: Associated Press, `Man Drops Suit Filed Against Airline After He Drank Booze, Fell,' USA Today (April 4, 2004).]
ÌSeveral months after the Escondido, California library's resident cat attacked Richard Espinosa's 50-pound Labrador-mix assistance dog, Espinosa filed a $1.5-million claim against the city, alleging that he was harmed due to the dog's injuries. According to the legal papers filed, Espinosa claimed his Federal and state constitutional rights were violated and that `. . . the defendants actions and subsequent inactions caused Espinosa to suffer significant lasting, extreme and severe mental anguish and emotional distress including, but not limited to, terror, humiliation, shame, embarrassment, mortification, chagrin, depression, panic, anxiety, flashbacks, nightmares, loss of sleep . . .' 82
[Footnote] According to the North County Times, `It took a jury little more than 2 hours of deliberation Friday to reject a claim from a man that the city of Escondido violated his civil rights when a cat living in a city library attacked his assistance dog more than 3 years ago . . . Espinosa originally asked for $1.5 million in compensation and damages . . . During jury selection Wednesday, Judge Hofmann excused four potential jurors who said they felt the case was `frivolous' and that they could not be impartial. Others also said the case was without merit, but said they could look beyond that feeling. `After that first juror said the word `frivolous,' and so did the next five, I thought the whole panel should have been thrown out,' Espinosa said . . . The city offered twice to settle with Espinosa, including one offer of $1,000. Espinosa declined. Nelson was unable to estimate how much the city spent defending itself against Espinosa's allegations, but he said it was a considerable sum. He also said the case could drag on for months or years if Espinosa does appeal.' 83
[Footnote]
[Footnote 82: Chuck Shepherd, `News of the Weird,' The Orlando Weekly (August 30, 2001).]
[Footnote 83: Teri Figueroa, `Jury Rejects Claim by Man in Attack on Dog by Library Cat,' The North County Times (January 20, 2004).]
ÌIn Ohio, Hamilton County Commissioner Todd Portune sued the Bengals and the National Football League claiming the team violated its stadium lease by failing to be competitive. The complaint, which also named the other 31 NFL franchises as defendants, alleges fraud, civil conspiracy, antitrust violations and breach of contract. 84
[Footnote]
[Footnote 84: Terry Kinney (the Associated Press) `Commissioner Sues Bengals, NFL' (January 31, 2003).]
ÌAfter three years of litigation, the Nebraska Supreme Court upheld a lower court ruling and found Ford Motor Co. and Bridgestone/Firestone Inc. not liable for the death of a woman killed by a man who gave her a lift after she got a flat tire. The woman's parents claimed in the lawsuit that a Firestone Wilderness AT tire on their daughter's Ford Explorer failed, setting off the chain of events that resulted in her death. The Nebraska court said the companies could not have foreseen the murderer's criminal acts. 85
[Footnote]
[Footnote 85: Kevin O'Hanlon, `Court: Faulty Tire Didn't Cause Murder,' the Associated Press (August 8, 2003).]
ÌAccording to the Albany Times Union, `The spectacle of American spending always gets a little silly in the holiday season, but shoppers over the next few weeks will be hard-pressed to match the performance last year of Antoinette Millard. She ran up bills of almost $1 million in New York luxury stores like Cartier and Barneys, and, according to court papers, Millard is now suing American Express for improperly soliciting her to sign up for a big-spender's credit card, her purchasing weapon of choice.' 86
[Footnote]
[Footnote 86: Steve Lohr, `Buying Easy, Paying Hard,' Times Union (December 5, 2004) at A1.]
ÌThe Court of Appeals of Indiana had this to say about a recent lawsuit brought by a man who sued his cell phone company because he got in an accident while using it in his car. The court stated:
ÌWith respect to Cingular, the complaint alleged: `That at the time of this collision the defendant Meagher was utilizing a telephone furnished by Cingular Wireless. That Cingular Wireless was negligent in furnishing a cellular phone to Meagher when it knew, or should have known, that it would be used while the user operated a motor vehicle.' . . . A cellular phone does not cause a driver to wreck a car. Rather, it is the driver's inattention while using the phone that may cause an accident . . . For example, many items may be used by a person while driving, thus making the person less attentive to driving. It is foreseeable to some extent that there will be drivers who eat, apply make up, or look at a map while driving and that some of those drivers will be involved in car accidents because of the resulting distraction. However, it would be unreasonable to find it sound public policy to impose a duty on the restaurant or cosmetic manufacturer or map designer to prevent such accidents. It is the driver's responsibility to drive with due care. Similarly, Cingular cannot control what people do with the phones after they purchase them. To place a duty on Cingular to stop selling cellular phones because they might be involved in a car accident would be akin to making a car manufacturer stop selling otherwise safe cars because the car might be negligently used in such a way that it causes an accident . . . Ultimately, sound public policy dictates that the responsibility for negligent driving should fall on the driver. Legislation has already been drafted to address the issue of cellular phone use while driving and to place the responsibility on the driver to refrain from doing so. We are confident that the legislature is taking appropriate measures to protect public safety, and that is both its right and duty.' 87
[Footnote]
[Footnote 87: Williams v. Cingular Wireless, No. 82A01-0312-CV-476 (Ct. App. Ind. June 4, 2004), at 2, 7-9.]
Today, testaments to the age of frivolous lawsuits are written on all manner of product warnings that aim to prevent obvious misuse. A label on a snow sled says `Beware: sled may develop a high speed under certain snow conditions.' 88
[Footnote] One warning label on a toilet brush states `Do not use for personal hygiene.' 89
[Footnote] A 5-inch brass fishing lure with three hooks is labeled `Harmful if swallowed.' A warning on an electric router made for carpenters states `This product not intended for use as a dental drill.' A warning label on a baby stroller cautions `Remove child before folding.' A sticker on a 13-inch wheel on a wheelbarrow warns `Not intended for highway use.' A dishwasher carries the warning `Do not allow children to play in the dishwasher.' A manufactured fireplace log states `Caution--Risk of Fire.' A household iron contains the warning `Never iron clothes while they are being worn.' 90
[Footnote] And a cardboard car sun shield that keeps sun off the dashboard warns `Do not drive with sun shield in place.' 91
[Footnote]
[Footnote 88: As one commentator has remarked, `yet another popular sledding hill' closed in Methuen, Massachusetts because nobody wants to `assume the risk of paying damages for anyone who gets hurt. Of course, in a world with common sense, [we] wouldn't have to worry about it.' Taylor Armerding, `Liability, Litigation Make Sled Tracks Disappear,' Gloucester Daily Times (December 28, 2004).]
[Footnote 89: David N. Goodman, `Toilet Brush Warning Wins Consumer Award,' The Associated Press (January 6, 2005).]
[Footnote 90: Sonny Garrett, `Warning: People Are as Dumb as You Think,' The Baxter Bulletin (April 17, 2004) (compiling list from Michigan Lawsuit Abuse Watch in Annual Wacky Warning Label Contest).]
[Footnote 91: Larry D. Hatfield, `Dumbest Warning Labels Get their Due,' The San Francisco Chronicle (January 24, 2002).]
It should be emphasized that statistics do not capture the very real experiences of victims of lawsuit abuse that constituents suffer, and this debate is not about aggregate statistics regarding the number of lawsuits filed.
However, requiring sanctions when judges find lawsuits are frivolous will surely deter many frivolous cases from being brought. That will be a good thing, considering the cost of today's tort system to Americans is staggering. After leveling off during the 1990's, the system's direct costs soared by a stunning 14.4% in 2001 and another 13.3% in 2002, to a 2002 total of $233 billion, the equivalent of a 5% tax on wages, 92
[Footnote] according to a report released by Tillinghast-Towers Perrin, which publishes the most definitive trend statistics on tort system costs. Inflation-adjusted direct U.S. tort costs per person have shot from $89 in 1950 to $809 in 2002. 93
[Footnote]
[Footnote 92: Tillinghast-Towers Perrin, U.S. Tort Costs: 2003 Update: Trends and Findings on the Costs of the U.S. Tort System, at 1. Tillinghast's reports on tort system costs are funded internally.]
[Footnote 93: Id. at 1.]
The costs of America's lawsuit culture are staggering. As chronicled by Sebastian Mallaby in The Washington Post:
The most complete study of the tort system's cost comes from the consulting firm Tillinghast-Towers Perrin. Tillinghast's clients are mainly insurers, which are at loggerheads with the trial bar, so you may mistrust its data. Nonetheless, Tillinghast has published seven updates to its original 1985 study, refining its methodology along the way. Its numbers are the best available. And they are stunning . . . the really shocking thing is where the billions went. Injured plaintiffs--the fabled little guys for whom the system is supposedly designed--got less than half the money. According to Tillinghast's 2002 data, plaintiffs' lawyers swallowed 19 percent of the $233 billion. Defense lawyers pocketed an additional 14 percent, and other administrative costs, mainly at insurance firms, accounted for a further 21 percent. The legal-administrative complex thus guzzled fully 54 percent of the money in the tort system, or $126 billion. That's 43 times as much as the Federal Government has budgeted this year to combat the global AIDS pandemic. No other system for compensating misfortune has such outrageous administrative costs. To guard against the possibility of sickness, people buy medical insurance. The health insurance industry, justly regarded as a paper-clogged nightmare, has administrative costs of 14 percent. To guard against the danger of disability, we have the Social Security program. The overhead for the Social Security disability system is around 3 percent. If you want a really good number to set against the 54 percent overhead in the tort system, just take a look at Medicare. Its overhead is about 2 percent. So the tort system's administrative costs are a scandal . . . Measured as a share of GDP, America's tort system is more than twice as expensive as it was in 1960, twice as expensive as the current systems in France or Canada, and three times as expensive as the system in Britain. A reasonable goal for the American tort system is to halve it. 94
[Footnote]
[Footnote 94: Sebastian Mallaby, `The Trouble with Torts,' The Washington Post (January 10, 2005) at A17. See also U.S. Tort Costs: 2004 Update: Trends and Findings on the Cost of the U.S. Tort System, Towers Perrin Tillinghast (2004) (`Looking ahead, we anticipate growth in U.S. tort costs to range from 5% to 8% in 2005, with a midpoint of 6.5% We expect a similar increase in 2006.').]
As columnist Stuart Taylor, Jr., has observed:
The most recent NCSC [National Center for State Courts] report states that its (incomplete) data `indicate a 40 percent increase in tort filings' from 1975 to 2002. Census figures indicate that the population increase from 1975 to 2002 was about 33 percent. So tort filings per capita have not declined by 8 percent since 1975; they have increased somewhat . . . And although the tort system's inflation-adjusted direct costs per capita did decline modestly during the 1990's, they soared by a stunning 14.4 percent in 2001 and another 13.3 percent in 2002, to an estimated 2002 total of $233 billion. The tort system consumes 2.2 percent of GDP in the U.S- almost four times the percentage in 1950; more than triple the 0.6 percent in the United Kingdom; and more than double the 0.8 percent in Japan, France, and Canada. 95
[Footnote]
[Footnote 95: Stuart Taylor, Jr., `False Alarm' by Stephanie Mencimer [Washington Monthly, Oct. 2004]--A Response by Stuart Taylor, Jr. [Newsweek, National Journal],' available at http://www.overlawyered.com/pages/taylormencimerwashingtonmonthly.html.]
According to the Economic Report of the President, `The expansive tort system has a considerable impact on the U.S. economy. Tort liability leads to lower spending on research and development, higher health care costs, and job losses.' 96
[Footnote] And according to the Council of Economic Advisers, `the United States tort system is the most expensive in the world, more than double the average cost of other industrialized nations.' 97
[Footnote] The direct costs of medical malpractice claims jumped by an average of 11.9 percent a year from 1975 to 2002. 98
[Footnote]
[Footnote 96: Economic Report of the President (February 2004) at 203.]
[Footnote 97: Council of Economic Advisers, `Who Pays for Tort Liability Claims? An Economic Analysis of the U.S. Tort Liability System' (April 2002) at 1.]
[Footnote 98: Tillinghast-Towers Perrin, U.S. Tort Costs: 2003 Update: Trends and Findings on the Costs of the U.S. Tort System, at 2.]
Of the $233 billion total, only 22 cents on the dollar went to compensate alleged victims' economic losses; almost as much (19 cents) went to their lawyers; 24 cents went to payments for inherently unquantifiable noneconomic losses, mainly pain and suffering; 14 cents went to defense costs; and 21 cents went to insurance overhead costs. 99
[Footnote]
[Footnote 99: Id. at 17. According to an analysis of a report by the National Center for State Courts by Newsweek's Stuart Taylor, Jr., although tort filings declined by 9 percent from 1992 to 2001, almost all of that decline came in routine car-crash lawsuits. The report shows that medical malpractice claims increased by 24 percent from 1992-2001 and that total tort filings soared by 40 percent from 1975 to 2001, despite a dip during the 1990's. See Stuart Taylor, Jr. Response to ATLA's Claims, available at http://www.overlawyered.com/archives/000708.html. Chief Justice Rehnquist released new data on January 1, 2004, showing an 8 percent drop in civil filings in fiscal year 2003, `primarily as a result of decreases in personal injury/product liability cases involving asbestos (such filings had soared 98 percent the previous year).' William H. Rehnquist, 36 The Third Branch 1 (January 2004), 2003 Year-End Report on the Federal Judiciary, Chapter III, n.5. See also Economic Report of the President (February 2004), at 204-05 (`The number of injuries handles by the tort system has increased along with expenditures. The number of filings per capita started to rise in the early 1980's and peaked in the mid-1980's, at least in the 16 states for which data on lawsuit filings are available between 1975 and 2000. Much of the decline in filings since 1985 appears to have occurred in California, where medical liability reforms included a $250,000 limit for noneconomic damages that was found constitutional in 1985.').]
A recent report by Judyth Pendell, Senior Fellow at the AEI-Brookings Joint Center for Regulatory Studies, and Paul Hinton, Vice President of NERA Economic Consulting, has concluded that `The tort liability price tag for small businesses in America is $88 billion a year' and that `Small businesses bear 68 percent of business tort liability costs, but take in only 25% of business revenue.' 100
[Footnote] The small businesses studied in the report account for 98% of the total number of businesses with employees in the United States. 101
[Footnote]
[Footnote 100: Judyth Pendell and Paul Hinton, `Liability Costs for Small Business' (U.S. Chamber Institute for Legal Reform, June, 2004) at 1 (`small business' defined as `those with less than $10 million in annual revenue and at least one employee in addition to the owner').]
[Footnote 101: Id.]
Without the serious threat of punishment for filing frivolous lawsuits, innocent individuals and companies will continue to face the harsh economic reality that simply paying off frivolous claimants through monetary settlements is often cheaper than litigating the case. If it costs $10,000 to defend yourself in court against frivolous charges, it makes financial sense to settle the case for $9,000, even if you weren't at fault in any way. This perverse dynamic not only results in legalized extortion, but it leads to increases in the insurance premiums all individuals and businesses must pay. 102
[Footnote]
[Footnote 102: Opponents of reform often claim that contingency fees--agreements by which personal injury attorneys are allowed a percentage cut from any monetary damages awarded to their client--provide a `screening mechanism' that weeds out frivolous cases. The argument used is that personal injury attorneys will not take frivolous cases because doing so would leave them with no monetary recovery. The perverse dynamic outlined above, and the fact that filing fees are usually no more than a hundred dollars and additional defendants can be named in the lawsuit at no extra charge, makes clear that contingency fee agreements provide no effective screening mechanism at all since personal injury attorneys can simply take advantage of the legal costs they impose on defendants simply in virtue of their filing a case to extort money from those they sue.]
The incentives for personal injury lawyers to file meritless nuisance lawsuits for their settlement value are clear. As leading commentators from Harvard Law School have described the situation under current law:
[T]he plaintiff may choose to file a claim at some (presumably small) cost. If the defendant does not then settle with the plaintiff and does not, at a cost, defend himself, the plaintiff will prevail by default judgment . . . Given the model and the assumption that each party acts in his financial interest and realizes the other will do the same, it is easy to see how nuisance suits can arise. By filing a claim, any plaintiff, and thus the plaintiff with a weak case, places the defendant in a position where he will be held liable for the full judgment demanded unless he defends himself. Hence, the defendant should be willing to pay a positive amount in settlement to the plaintiff with a weak case--despite the defendant's knowledge that were he to defend himself, such a plaintiff would withdraw. 103
[Footnote]
[Footnote 103: D. Rosenberg and S. Shavell, `A Model in which Suits are Brought for their Nuisance Value,' 5 International Rev. of Law and Economics 3, 3 (June 1985).]
These commentators point out that defendants will always have to suffer extortion through nuisance lawsuits because `to defeat a claim, the defendant will have to engage in actions that are frequently more expensive than the plaintiff's cost of making the claim, for the defendant will have to gather evidence supporting his contention that he was not legally responsible for harm done to the plaintiff or that no harm was actually done.' 104
[Footnote] The same commentators offer the following illustration:
[Footnote 104: Id. at 10.]
Suppose, for instance, that the plaintiff files a claim and demands $180 in settlement. The defendant will then reason as follows. If he settles, his costs will be $180. If he rejects the demand and does not defend himself, he will lose $1000 by default judgment. If he rejects the demand and defends himself, the plaintiff will withdraw, but he will have spent $200 to accomplish this. Hence, the defendant's costs are minimized if he accepts the plaintiff's demand for $180; and the same logic shows that he would have accepted any demand up to $200. It follows that the plaintiff will find it profitable to file his nuisance claim; indeed, this will be so whenever the cost of filing is less than the defendant's cost of defense. 105
[Footnote]
[Footnote 105: Id. at 4.]
Personal injury lawyers can always extort money from innocent victims by filing nuisance lawsuits for their settlement value. H.R. 420 will prevent such extortion by giving victims an opportunity they do not have now to get financial compensation for the costs they are forced to bear by legal tormentors filing frivolous lawsuits.
Page 4, strike lines 8 through 11 and insert the following:
(a) In General- Subject to subsection (b), a personal injury claim filed in State or Federal court may be filed only in the State and, within that State, in the county (or if there is no State court in the county, the nearest county where a court of general jurisdiction is located) or Federal district in which--
Page 5, line 23, strike `and'.
Page 5, line 25, strike the period at the end and insert `; and'.
Page 5, after line 25, insert the following:
(C) does not include a claim against a debtor in a case pending under title 11 of the United States Code that is a personal injury tort or wrongful death claim within the meaning of section 157(b)(5) of title 28, United States Code.
Page, 7, strike line 16 and all that follows through the end of the bill and insert the following new sections:
Whenever a party presents to a Federal court a pleading, written motion, or other paper, that includes a claim or defense that the party has already litigated and lost on the merits in any forum in final decisions not subject to appeal on 3 consecutive occasions, and the claim or defense involves the same plaintiff and the same defendant, there shall be a rebuttable presumption that the presentation of such paper is in violation of Rule 11 of the Federal Rules of Civil Procedure.
Whoever willfully and intentionally influences, obstructs, or impedes, or attempts to influence, or obstruct, or impede, a pending Federal court proceeding through the willful and intentional destruction of documents sought pursuant to the rules of such Federal court proceeding and highly relevant to that proceeding--
(1) shall be punished with mandatory civil sanctions of a degree commensurate with the civil sanctions available under Rule 11 of the Federal Rules of Civil Procedure, in addition to any other civil sanctions that otherwise apply; and
(2) shall be held in contempt of court and, if an attorney, referred to one or more appropriate State bar associations for disciplinary proceedings.
(a) In General- In any Rule 11 of the Federal Rules of Civil Procedure proceeding, a court may not order that a court record not be disclosed unless the court makes a finding of fact that identifies the interest that justifies the order and determines that that interest outweighs any interest in the public health and safety that the court determines would be served by disclosing the court record.
(b) Applicability- This section applies to any record formally filed with the court, but shall not include any records subject to--
(1) the attorney-client privilege or any other privilege recognized under Federal or State law that grants the right to prevent disclosure of certain information unless the privilege has been waived; or
(2) applicable State or Federal laws that protect the confidentiality of crime victims, including victims of sexual abuse.
-
Strike all after the enacting clause and insert the following:
(a) Signature Required- Every pleading, written motion, and other paper in any action shall be signed by at least 1 attorney of record in the attorney's individual name, or, if the party is not represented by an attorney, shall be signed by the party. Each paper shall state the signer's address and telephone number, if any. An unsigned paper shall be stricken unless omission of the signature is corrected promptly after being called to the attention of the attorney or party.
(b) Certificate of Merit- By presenting to the court (whether by signing, filing, submitting, or later advocating) a pleading, written motion, or other paper, an attorney or unrepresented party is certifying that to the best of the person's knowledge, information and belief, formed after an inquiry reasonable under the circumstances--
(1) it is not being presented for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation;
(2) the claims, defenses, and other legal contentions therein are warranted by existing law or by a non frivolous argument for the extension, modification, or reversal of existing law or the establishment of new law; and
(3) the allegations and other factual contentions have evidentiary support or, if specifically so identified, are reasonable based on a lack of information or belief.
(c) Mandatory Sanctions-
(1) FIRST VIOLATION- If, after notice and a reasonable opportunity to respond, a court, upon motion or upon its own initiative, determines that subsection (b) has been violated, the court shall find each attorney or party in violation in contempt of court and shall require the payment of costs and attorneys fees. The court may also impose additional appropriate sanctions, such as striking the pleadings, dismissing the suit, and sanctions plus interest, upon the person in violation, or upon both such person and such person's attorney or client (as the case may be).
(2) SECOND VIOLATION- If, after notice and a reasonable opportunity to respond, a court, upon motion or upon its own initiative, determines that subsection (b) has been violated and that the attorney or party with respect to which the determination was made has committed one previous violation of subsection (b) before this or any other court, the court shall find each such attorney or party in contempt of court and shall require the payment of costs and attorneys fees, and require such person in violation (or both such person and such person's attorney or client (as the case may be)) to pay a monetary fine. The court may also impose additional appropriate sanctions, such as striking the pleadings, dismissing the suit and sanctions plus interest, upon such person in violation, or upon both such person and such person's attorney or client (as the case may be).
(3) THIRD AND SUBSEQUENT VIOLATIONS- If, after notice and a reasonable opportunity to respond, a court, upon motion or upon its own initiative, determines that subsection (b) has been violated and that the attorney or party with respect to which the determination was made has committed more than one previous violation of subsection (b) before this or any other court, the court shall find each such attorney or party in contempt of court, refer each such attorney to one or more appropriate State bar associations for disciplinary proceedings (including suspension of that attorney from the practice of law for one year or disbarment), require the payment of costs and attorneys fees, and require such person in violation (or both such person and such person's attorney, or client (as the case may be)) to pay a monetary fine. The court may also impose additional appropriate sanctions, such as striking the pleadings, dismissing the suit, and sanctions plus interest, upon such person in violation, or upon both such person and such person's attorney or client (as the case may be).
(4) APPEAL; STAY- An attorney has the right to appeal a sanction under this subsection. While such an appeal is pending, the sanction shall be stayed.
(5) NOT APPLICABLE TO CIVIL RIGHTS CLAIMS- Notwithstanding subsection (d), this subsection does not apply to an action or claim arising out of Federal, State, or local civil rights law or any other Federal, State, or local law providing protection from discrimination.
(d) Applicability- Except as provided in subsection (c)(5), this section applies to any paper filed on or after the date of the enactment of this Act in--
(1) any action in Federal court; and
(2) any action in State court, if the court, upon motion or upon its own initiative, determines that the action affects interstate commerce.
(a) Signatures Required on Disclosures- Every disclosure made pursuant to subdivision (a)(1) or subdivision (a)(3) of Rule 26 of the Federal Rules of Civil Procedure or any comparable State rule shall be signed by at least one attorney of record in the attorney's individual name, whose address shall be stated. An unrepresented party shall sign the disclosure and state the party's address. The signature of the attorney or party constitutes a certification that to the best of the signer's knowledge, information, and belief, formed after a reasonable inquiry, the disclosure is complete and correct as of the time it is made.
(b) Signatures Required on Discovery-
(1) IN GENERAL- Every discovery request, response, or objection made by a party represented by an attorney shall be signed by at least one attorney of record in the attorney's individual name, whose address shall be stated. An unrepresented party shall sign the request, response, or objection and state the party's address. The signature of the attorney or party constitutes a certification that to the best of the signer's knowledge, information, and belief, formed after a reasonable inquiry, the request, response, or objection is:
(A) consistent with the applicable rules of civil procedure and warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law;
(B) not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation; and
(C) not unreasonable or unduly burdensome or expensive, given the needs of the case, the discovery already had in the case, the amount in controversy, and the importance of the issues at stake in the litigation.
(2) STRICKEN- If a request, response, or objection is not signed, it shall be stricken unless it is signed promptly after the omission is called to the attention of the party making the request, response, or objection, and a party shall not be obligated to take any action with respect to it until it is signed.
(c) Mandatory Sanctions-
(1) FIRST VIOLATION- If without substantial justification a certification is made in violation of this section, the court, upon motion or upon its own initiative, shall find each attorney or party in contempt of court and shall require the payment of costs and attorneys fees. The court may also impose additional sanctions, such as imposing sanctions plus interest or imposing a fine upon the person in violation, or upon such person and such person's attorney or client (as the case may be).
(2) SECOND VIOLATION- If without substantial justification a certification is made in violation of this section and that the attorney or party with respect to which the determination is made has committed one previous violation of this section before this or any other court, the court, upon motion or upon its own initiative, shall find each attorney or party in contempt of court and shall require the payment of costs and attorneys fees, and require such person in violation (or both such person and such person's attorney or client (as the case may be)) to pay a monetary fine. The court may also impose additional sanctions upon such person in violation, or upon both such person and such person's attorney or client (as the case may be).
(3) THIRD AND SUBSEQUENT VIOLATIONS- If without substantial justification a certification is made in violation of this section and that the attorney or party with respect to which the determination is made has committed more than one previous violation of this section before this or any other court, the court, upon motion or upon its own initiative, shall find each attorney or party in contempt of court, shall require the payment of costs and attorneys fees, require such person in violation (or both such person and such person's attorney or client (as the case may be)) to pay a monetary fine, and refer such attorney to one or more appropriate State bar associations for disciplinary proceedings (including the suspension of that attorney from the practice of law for one year or disbarment). The court may also impose additional sanctions upon such person in violation, or upon both such person and such person's attorney or client (as the case may be).
(4) APPEAL; STAY- An attorney has the right to appeal a sanction under this subsection. While such an appeal is pending, the sanction shall be stayed.
(d) Applicability- This section applies to any paper filed on or after the date of the enactment of this Act in--
(1) any action in Federal court; and
(2) any action in State court, if the court, upon motion or upon its own initiative, determines that the action affects interstate commerce.
(a) In General- In any Rule 11 of the Federal Rules of Civil Procedure proceeding, a court may not order that a court record not be disclosed unless the court makes a finding of fact that identifies the interest that justifies the order and determines that the interest outweighs any interest in the public health and safety that the court determines would be served by disclosing the court record.
(b) Applicability- This section applies to any record formally filed with the court, but shall not include any records subject to--
(1) the attorney-client privilege or any other privilege recognized under Federal or State law that grants the right to prevent disclosure of certain information unless the privilege has been waived; or
(2) applicable State or Federal laws that protect the confidentiality of crime victims, including victims of sexual abuse.
Whoever willfully and intentionally influences, obstructs, or impedes, or attempts to influence, or obstruct, or impede, a pending Federal court proceeding through the willful and intentional destruction of documents sought pursuant to the rules of such Federal court proceeding and highly relevant to that proceeding--
(1) shall be punished with mandatory civil sanctions of a degree commensurate with the civil sanctions available under Rule 11 of the Federal Rules of Civil Procedure, in addition to any other civil sanctions that otherwise apply; and
(2) shall be held in contempt of court and, if an attorney, referred to one or more appropriate State bar associations for disciplinary proceedings.
(a) General Rule- In any civil action for injury that was sustained in the United States and that relates to the acts of a foreign business, the Federal court or State court in which such action is brought shall have jurisdiction over the foreign business if--
(1) the business purposefully availed itself of the privilege of doing business in the United States or that State;
(2) the cause of action arises from the business's activities in the United States or that State; and
(3) the exercise of jurisdiction would be fair and reasonable.
(b) Admission- If in any civil action a foreign business involved in such action fails to furnish any testimony, document, or other thing upon a duly issued discovery order by the court in such action, such failure shall be deemed an admission of any fact with respect to which the discovery order relates.
(c) Process- Process in an action described in subsection (a) may be served wherever the foreign business is located, has an agent, or transacts business.
(d) Definition- In this section, the term `foreign business' means a business that has its principal place of business, and substantial business operations, outside the United States and its Territories.
(a) In General- Whenever a party presents to a Federal court a pleading, written motion, or other paper, that includes a claim or defense that the party has already litigated and lost on the merits in any forum in final decisions not subject to appeal on 3 consecutive occasions, and the claim or defense involves the same plaintiff and the same defendant, there shall be a rebuttable presumption that the presentation of such paper is in violation of Rule 11 of the Federal Rules of Civil Procedure.
(b) Exception- Subsection (a) does not apply to a claim arising under the Constitution of the United States.
AMENDMENTS VOTED ON THE HOUSE FLOOR
1. H.AMDT.605 to H.R.420 An amendment numbered 1 printed in House Report
109-253 to include provisions imposing sanctions for the destruction of relevant
documents in a pending Federal court proceeding; provisions for setting
standards for a court's determination that certain court records should be
sealed; and provisions providing for a presumption of a Rule 11 violation when
the same issue is repeatedly relitigated. It also includes a clarification that
makes clear that, in the anti-forum shopping provisions, if there is no State
court in the county in which the injury occurred, the case can be brought in the
nearest county where a court of general jurisdiction is located. The manager's
amendment also makes clear that it does not affect personal injury claims that
Federal bankruptcy law requires be heard in a Federal bankruptcy court.
Sponsor: Rep Smith, Lamar [TX-21] (introduced 10/27/2005) Cosponsors
(None)
Latest Major Action: 10/27/2005 House amendment agreed to. Status: On
agreeing to the Smith (TX) amendment (A001) Agreed to by voice vote.
2. H.AMDT.606 to H.R.420 An amendment numbered 2 printed in House Report
109-253 to provide strong "three strikes and you're out" mandatory sanctions for
attorneys who file frivolous lawsuits or engage in frivolous conduct during
discovery. Enhances sanctions for document destruction, ensures that
corporations can be sued in the U.S., cracks down on parties attempting to
relitigate the same issue on consecutive occasions, bans the concealment of
unlawful conduct, and protects civil rights claims.
Sponsor: Rep Schiff, Adam B. [CA-29] (introduced 10/27/2005) Cosponsors
(None)
Latest Major Action: 10/27/2005 House amendment not agreed to. Status: On
agreeing to the Schiff amendment (A002) Failed by recorded vote: 184 - 226 (RC
551).
## All Rights Reserved. © 2005 TheWeekInCongress.com.
No reproduction or distribution without written permission from TheWeekInCongress.com.