Civil suit cap clears the House

March 11, 1995|By Knight-Ridder News Service

WASHINGTON -- The House approved a bill yesterday that would shield an array of business people and industries -- from doctors to automakers -- from expensive jury awards for punitive damages in all civil lawsuits.

In passing the bill on a 265-161 vote, House Republicans kept another of their promises made in their "Contract with America." It was the third bill to clear the House this week that would limit damages in civil lawsuits.

The three measures now go to the Senate, where some Republicans already have waved warning flags that could slow down, or even sideline, some of the more controversial provisions in the bills.

Rep. Christopher Cox, a California Republican and chief sponsor of the bill, said the legislation would "end the patchwork of local laws" that encourage lawyers to shop from state to state for friendlier venues to pursue fatter damage awards.

Other sponsors, including Judiciary Committee Chairman Henry J. Hyde, an Illinois Republican, said the bills would "put a serious damper on frivolous and fraudulent lawsuits" jamming state and federal courts.

But critics, including President Clinton, charged that the changes would tip the balance in civil actions to wealthy defendants and discourage average citizens from challenging corporations and insurers.

"Even people with solid cases and clearly warranted complaints would be scared out of the courts and denied their basic rights," said Democratic Rep. John Conyers Jr. of Michigan.

The bill that was passed yesterday would limit punitive damages in all civil cases -- in federal and state courts alike -- to the greater of $250,000 or three times the amount of the complainant's economic loss.

It also raises the threshold of proof for making such cases. Before punitive damages could be awarded, courts would have to find "clear and convincing evidence" that a defendant intended to cause harm or was guilty of a "conscious, flagrant indifference to the safety of others."

The limit on punitive damages would apply to all civil lawsuits -- known as tort cases -- and would spread a blanket of uniformity for standards of proof over every court in the land, reversing some 200 years of civil practice.

Product liability, medical malpractice, auto accident cases -- all would be subject to the new limitations on punitive damages.

Such damages are sometimes assessed, over and above direct economic losses and damages for pain and suffering, to punish and deter defendants from engaging in wanton misconduct. They are also intended to foster greater care for health and safety in making and selling products and services.

While the standards now vary from state to state, they are generally awarded when a plaintiff shows that a manufacturer or seller was "flagrantly indifferent" to a consumer's health or safety.

The bill also would make distributors and retailers less likely to be successfully sued for damages arising from faulty products.

Business groups have been pushing for such legislation for years. But they were thwarted in the past by consumer groups, trial lawyers and their Democratic allies in Congress.

Earlier this week, the House passed bills that would require some losing plaintiffs to pay part of the legal fees of defendants and that would sharply limit the ability of investors to sue stockbrokers or publicly traded corporations for alleged misconduct.

In the bill passed yesterday, physicians would be protected not only from higher punitive damages but also from higher damage awards for pain and suffering, loss of companionship or other normal human activities known as "noneconomic" factors. Pain-and-suffering damage awards would be limited to $250,000.

The bill also limits to $250,000 any punitive damages against drug companies and the makers of medical devices, if their products have been approved by the U.S. Food and Drug Administration.

The limits imposed on pain and suffering damages against physicians drew the sharpest rebukes from critics during the weeklong debate on the three measures.

Mr. Cox maintained that high awards had driven up malpractice insurance rates to the point that many doctors could no longer afford to do high-risk, but potentially lifesaving, procedures.

But Democratic Rep. Richard J. Durbin of Illinois charged that the pain-and-suffering limits would impose insurmountable hardship on those faced with lifetime disability from a doctor's negligence.

On final passage, 220 Republicans and 45 Democrats supported the bill; 154 Democrats, six Republicans and one independent ++ opposed it.

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