Providing For Consideration of H.R. 4571, Lawsuit Abuse Reduction Act of 2004
PROVIDING FOR CONSIDERATION OF H.R. 4571, LAWSUIT ABUSE REDUCTION ACT OF 2004 -- (House of Representatives - September 14, 2004)
Mr. SESSIONS. Mr. Speaker, by direction of the Committee on Rules, I call up House Resolution 766 and ask for its immediate consideration.
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Mr. McGOVERN. Mr. Speaker, I yield myself such time as I may consume.
(Mr. McGOVERN asked and was given permission to revise and extend his remarks.)
Mr. McGOVERN. Mr. Speaker, I thank the gentleman from Texas (Mr. Sessions) for yielding me the customary 30 minutes.
Mr. Speaker, I rise in opposition to this rule and in opposition to H.R. 4571, the so-called Frivolous Lawsuit Protection Act.
Today the Republican leadership of this body continues willful disregard for the American public. Once again we are considering legislation in the shadow of the November elections, and once again the Republican leadership is catering to big business at the expense of the public good. And once again that leadership is squandering the House's limited time with foolish, misguided special interest legislation.
This is a bill that attempts to turn back the judicial clock by over a decade; and in the process, more pressing issues and priorities are ignored. Mr. Speaker, this simply is not needed.
Yesterday the Federal Assault Weapons Ban died at the hands of the Republican leadership. President Bush, who, during his first campaign, said he saw no reason for such weapons to be on the street, indicated on more than one occasion that he would sign a new bill if the Republican-controlled Congress sent him one. But the Republican leadership refused to bring the reauthorization up for a vote. I believe they prevented a vote to protect President Bush from having to sign or veto the reauthorization of the Federal Assault Weapons Ban. Why? Because doing the bidding of the gun lobby is their priority. Apparently the Republican strategy in homeland security includes defying law enforcement by making these military-style assault weapons more available.
Mr. Speaker, in addition to failing to act on the Federal assault weapons ban this week, the Republican leadership has scheduled zero time, that is zero time, to consider the 9/11 Commission's recommendations. The Commission took a hard and comprehensive look at the intelligence and homeland security needs of our country. They asked Congress to do its job, to take a hard look at the way this House organizes and carries out its works, ways that potentially undercut the security of our Nation and our people. Yet, today, in this House, it is business as usual, with special interest legislation on the House floor. Six weeks have passed since the Commission's report was first issued, and we still have no firm date as to when this House will take up legislation and debate the Commission's recommendations.
Will it be before Congress breaks for elections? Will we have to wait for another September 11 anniversary to come and go before we take up the Commission's findings? Or, like today, will this body continue to waste its time on frivolous legislation?
The Republican leadership in both parties of Congress has failed to pass a budget resolution, but we are not talking about that today. And today we begin one more legislative week without a transportation bill. We certainly are not working on a bill to increase the minimum wage, even though wages are stagnant and over 4 million Americans have fallen out of the middle class into poverty since George Bush became President. In fact, the Bush administration and the Republican Congress are on track to have the worst jobs record since the Great Depression, all the way back to Herbert Hoover. The average length of unemployment is at a 10-year high, and manufacturing employment remains at a 53-year low. Yet, this House does not seem to have the time to do anything to help the millions of Americans who have lost their jobs. No extension of unemployment benefits, no help for the millions of uninsured Americans, and certainly, no effort to reduce gas prices or lower the cost of college tuition, or pass a highway bill that might create good-paying jobs.
No, Mr. Speaker, we are not taking up legislation to address these issues today.
Mr. Speaker, if the American public wants real leadership on real issues, they should not look here for help. Indeed, this body is guilty of willful neglect of America's priorities. Why do we not work on a bill to help the millions of uninsured Americans? Over 70 percent of the uninsured live in households with at least one worker, and yet we sit idly by as more and more Americans work in jobs that provide little or no health care benefits.
Instead, here we are, taking up H.R. 4571, the so-called Frivolous Lawsuit Reduction Act, a bill that does nothing to address the real problems facing working families of America, yet does so much to help the special interests who fill the campaign coffers of the majority.
Among its provisions, H.R. 4571 would turn back the clock to the pre-1993 provision of Rule 11 of the Federal Rules of Civil Procedure, provisions that were changed on the recommendation of the Judicial Conference after years of study, approved by the U.S. Supreme Court, and reviewed by Congress in accordance with the Rules Enabling Act.
What will this bill change? The supporters of H.R. 4571 contend that it would help reduce frivolous lawsuits. That is what they say. But in reality, the bill would have a terrible effect on credible claims brought by families, workers, consumers, and senior citizens.
Without many of these civil lawsuits, the following changes in consumer products would likely never have occurred: The redesign of defective baby cribs so that they no longer strangle infants; flammable children's pajamas taken off the market; the redesign of harmful medical devices; the strengthening of auto fuel systems so that they do not blow up upon impact; the addition of basic safeguards to dangerous farm machinery; and the elimination of asbestos so that workers are no longer poisoned in their workplaces.
Mr. Speaker, instead of providing more protections for the average American, the Republican leadership actually provides protections for, get this, the "Benedict Arnold corporations" who reincorporate in a foreign tax shelter only to avoid paying U.S. taxes. Specifically, this bill protects these Benedict Arnold corporations from lawsuits American citizens could file if they are injured by those corporations' products. Unbelievable. The bill limits the venue of a lawsuit against a corporate defendant to either the place the injury happened or the jurisdiction where "the defendant's principal place of business is located." If a foreign corporation does not do significant business in a place where the injury occurred, a plaintiff cannot sue a corporation headquartered outside the United States. In other words, a person injured by a defective product would be able to sue a U.S. corporation in its principal place of business, but he or she would often have no way to seek redress against a foreign corporation.
Now, the gentleman from Texas (Mr. Turner) attempted to fix this provision. While the Republican leadership actually made the Turner amendment in order, they did so only after a provision intended to hold these Benedict Arnold corporations accountable for their actions in the United States was removed from the amendment. The provision the Republican leadership removed from the Turner amendment defines Benedict Arnold corporations as U.S. companies that set up corporate shells in foreign countries in order to escape U.S. tax liability and other U.S. regulatory duties.
In other words, Mr. Speaker, the one proposal that was intended to protect people, not corporations, was left on the Committee on Rules floor last night. The Republican leadership does not want the American people to know that their bill puts Benedict Arnold corporations ahead of American consumers. This is just one example of the Republican leadership bending over backwards for special interests, while ignoring the real issues facing the American people. I hope my friend, the gentleman from Texas (Mr. Sessions), will take the time during this debate to explain to the American people why the Republican leadership continues to protect Benedict Arnold companies instead of fighting for American jobs here at home.
But, then again, today's debate is not about the real issues confronting the American people; it is all about distraction. If we waste enough time on this bill, maybe the American people will not have time to ponder the failures and the lack of action by the Republican-controlled Congress on our most pressing priorities. It is a cynical ploy, and I hope that the American people recognize it.
I urge my colleagues to reject H.R. 4571.
Mr. Speaker, I reserve the balance of my time.
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Mr. McGOVERN. Mr. Speaker, I yield myself such time as I may consume.
The gentleman from Texas (Mr. Sessions), I am happy to yield to him 30 seconds to answer the question that I asked in my opening statement and that is, why did you remove this section of the Turner amendment that held Benedict Arnold corporations accountable? Why do you feel that we need to protect companies who purposely open up P.O. boxes in Bermuda so that they can escape paying U.S. taxes? Even if you support paying Benedict Arnold corporations, why can we not have at least an up or down vote on an amendment so that the House can decide?
I am happy to yield to the gentleman 30 seconds so that he can clarify that for me.
Mr. SESSIONS. Mr. Speaker, I thank the gentleman for yielding, and I am pleased to respond. First of all, I would like to say that the gentleman from Texas (Mr. Turner) requested its removal.
Secondly, I would like to say that the provision actually allows a covered company under this provision that they have the absolute right not only to remove their case to Federal court, but they can remove the case to any Federal court in the country that they would like, and that they can pick the Federal court if they have one, wherever the Federal court is, and have the case there; whereas our bill prevents unfair forum shopping by making sure that cases are actually brought in States that actually have a connection to the case.
As the gentleman may be aware, there are abuses that take place all across this country, including in Illinois and Mississippi, where there are cases that are accepted by courts where no one actually even lives in those jurisdictions.
I thank the gentleman for asking for a response.
Mr. McGOVERN. Mr. Speaker, reclaiming my time, I appreciate the gentleman's response, but it really did not answer my question, and I yield myself such time as I may consume.
The bottom line is the gentleman from Texas (Mr. Turner) decided not to pursue his amendment only after he was told by the leadership of this House that he could not have the language he wanted, and the companies that we are talking about here, these Benedict Arnold companies, are not in individual States, they are in places like Bermuda.
I just think it is outrageous that these companies that really skirt U.S. tax law, and I think are not the kind of corporations that deserve to be protected, are in fact protected in this bill, and I think it is wrong.
Mr. Speaker, I would like to insert in the RECORD the complete text of the amendment that the gentleman from Texas (Mr. Turner) wanted to offer and was told that he could not offer because I think it is instructive for the American people to at least have on record what he tried to do.
SEC. 6. ACCOUNTABILITY FOR BENEDICT ARNOLD CORPORATIONS.
(a) Jurisdiction.-In any civil action concerning an injury that was sustained in the United States and in which the defendant is a Benedict Arnold corporation, any Federal court in which such action is brought shall have jurisdiction over such defendant.
(b) Service of Process.-Process in an action described in subsection (a) may be served wherever the Benedict Arnold corporation is located, has an agent, or transacts business.
(c)Definitions.-For purposes of this subsection:
(1) The term "Benedict Arnold corporation" means a foreign corporation that acquires a domestic corporation in a corporate repatriation transaction.
(2) The term "corporate repatriation transaction" means any transaction in which-
(A) a foreign corporation acquires substantially all of the properties held by a domestic corporation;
(B) shareholders of the domestic corporation, upon such acquisition, are the beneficial owners of securities in the foreign corporation that are entitled to 50 percent or more of the votes on any issue requiring shareholder approval; and
(C) the foreign corporation does not have substantial business activities (when compared to the total business activities of the corporate affiliated group) in the foreign country in which the foreign corporation is organized.
Mr. Speaker, I reserve the balance of my time.
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Mr. McGOVERN. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I urge my colleagues to reject H.R. 4571, and I ask that they support the substitute that will be offered by the gentleman from Texas (Mr. Turner).
The Turner substitute is a stronger bill and addresses the real needs of the American public. The Turner substitute respects all Americans by setting up other three strikes and you are out systems while protecting civil rights lawsuits. The Turner substitute also prevents corporate wrongdoers from sealing their activities in court records. And the Turner substitute requires States to put into action a system to speed up the trial process and eliminate junk lawsuits.
Let me again state for the record, Mr. Speaker, that it is frustrating and it is mind boggling to me that the Republican leadership insists that the Turner substitute not include language that would hold Benedict Arnold corporations accountable. What is the deal?
Why does the Republican leadership not only on this bill but on so many other bills in which we try to hold these companies accountable insist on bending over backwards to protect them. These are companies that purposefully set up P.O. boxes in places like Bermuda to avoid paying U.S. taxes. There is no citizen in this country that can do that. But these corporations that make millions and millions, if not billions of dollars get to do that, get to take advantage of all the benefits of this country, but do not have to pay U.S. taxes and here they are being protect from lawsuits if in fact they produce a damaging product.
It is wrong. It is outrageous. This should not be happening, and I would again just say that it is sad that we are at this point.
Mr. Speaker, I would urge the adoption again of the Turner substitute and the rejection of this ill-conceived, ill-advised bill, and I would urge my colleagues to vote no on H.R. 4571.
Mr. Speaker, I yield back the balance of my time.
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Mr. McGOVERN. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the Chair's prior announcement, further proceedings on this motion will be postponed.