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Legal Reform 9/7/92 [OA 7579] [1]
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Legal Reform 9/7/92 [OA 7579] [1]
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7
6
A FACT CHANGE MASTER
Provost/Bunton
*w/zoellick changes
Sept. 5, 1992 / 3:30 p.m.
Presidential Remarks
Waukesha County Picnic
Waukesha, Wisconsin
Monday, Sept. 7, 1992
Thank you Governor Tommy Thompson.
Today is Labor Day -- the day we honor American workers --
the most productive men and women in the entire world.
So today, I want to talk to you about a problem that affects
you and every other worker -- our crazy, out-of control - legal
system.
A serious discussion about legal reform may seem a little
odd as a topic for a picnic. But I think you deserve more than
talk from your political leaders -- you need answers. Answers to
BULLO UPON HIR
STRENGTHS AND
the most pressing question before America today -- how can we
(POFTER)
guarantee that we will remain not just a military superpower --
but an export superpower, and an economic superpower. //
As I see it, our current legal system is a roadblock that
must be cleared from the path of America's economic progress.
Let me start by talking about a famous American enforcer of
justice. I don't mean Oliver Wendell Holmes or John Marshall.
THE
WASHINGTON
I mean someone more famous than that. I mean -- Hulk Hogan. //
TIMES
1991
My grandkids tell me that in his movie last year -- Hulk
OCT.23,91
Hogan was confronted with the predictable crop of bad guys. Only
REMARKS
ON TORT
the bad guys refused to fight Hulk. Instead they said, "this is
CHARJUST. REPOR!
2
/
/
/
the nineties -- we re not going to fight you. We are going to
/
sue you. "
/
I fear that one statement, sums up a lot of what is
/
troubling America today.
/
Pick up the newspaper, the stories roll out at you.
Like by the now famous story about the basketball referee,
WALL
STREET
who made a controversial call at the buzzer of a Purdue-Iowa
JOURNAL
basketball game. Purdue won the game, and an Iowa souvenir
AUG.11,89
company was suddenly left with victory T-shirts that weren't in
all that much demand. So what did the company do? They sued the
referee. Sound crazy? It took two years, and a lot of money,
before the case was dismissed by the State Supreme Court.
Are these crazy legal stories just intended to give us
something to make our friends chuckle at backyard barbecues. I
don't think so. It's much more serious than that.
Look around here in Wisconsin, right here in Waukesha. [wok ashaw]
BRIAN
Anybody here cheer for the footbal Spartans
of East
DAKE/
EAST SPARTANS
HARLEY
Brookfield High School?// I'm told Coach Jack Perry and his team
GRAF, PE
0
SPECIALIST
now pay almost $150 bucks for every football helmet -- 10 years
AT WANKESHA
HALF
H16H SCHOOL
ago they paid about a third of that. Why the price increase?
Because over the past 18 years, 18 American companies have
LIABILITY
TAX RAISES
stopped selling football helmets -- because they can't afford the
PRICES: THE
CASE FOR
insurance. (Before this is over, we may go back to the days of
PRODUCT LIABILITY
FAIRNESS
Jim Thorpe -- when people played football without helmets. Is
MAY 1992
PLCC-
that progress?)
PRODUCT LIABILITY COORDINATING COMMITEE
No- IN 1988, RAWLINGS SPORTING GOODS
BECAME THE 18TH COMPANY IN 18 YEARS
TO GIVE up THE FBACC HELMET BIS. DUE
TO INCREASING LIABILITY EXPOSURE.
3
Now, Waukesha and Wisconsin aren't unique -- except in their
physical beauty. This kind of thing is happening every day in
every town across America. And we are all paying the price.
Now understand, this is not a criticism of lawyers. They
are an essential part of our society -- and the majority of legal
professionals work with integrity and honor. But the good
lawyers will tell you, the system is out of control. (DOJ)
CIVIL (DOJ)
DOJ/
In the past 20 years, the number of lawsuits filed in
MORE THAN (DOJ)
OFTEN (DOJ)
MRS. QUAYLE'S federal courts) (DOJ) has doubled. Today, the average case takes a
SPEECH ON
AUG. 17,92 year to be resolved -- and in the past year alone -- the number
NEARLY (DOJ)
of cases that were pending for 3 years, increased by 15 percent.
(Think about what that means. You can file a suit, and have
time to enroll in law school, study three years, graduate, pass
the bar, and then represent yourself in court on the day the
decision is reached.)
What does this litigation explosion cost our economy? Well,
BOBBY
CHARLES FACT the National Association of Manufacturers has just finished
SHEET/X2449
looking at that question. According to a soon to be released
study, Americans spend $200 billion dollars on direct costs to
ALONE (JOHN HOWARD - OVP) AND HE SUGGESTS DELETING SENTENCE THAT'S RIGHT BEHIN
lawyers. Keep in mind, that doesn't even count the lawyers on COULD PUT
LANOUAGE RE:
COURT DELAYS AN
their own payrolls, or the money they end up paying in court
LOST OPPORTUNITES
IN ITS PLACE
settlements. (JOHN HEWARD-OVP SAID DELETE This SENTENCE)
($200 billion sounds like a lot of money -- and believe me,
it is. American businesses now spend more on insurance, lawyers
THER INFORMAL OR FORMAL
and legal fees -- than on training, our workers for the new
TO PREPARE
economy.) To me that's crazy. As a nation, I believe it's high
BOBBY CHARLES SUGGESTS: AMERICAN CONSUMERS AND COMPANIES will SPEND up TO $200 BILLION
(INOPO)
DOLLARS IN LEGAL SERVICES THIS YEAR.
OK BUT ONLY w/ ADDITIONAL QUALIMER (Betsy Anderson QD - 9/90 STUDY)
WORKER TRAINING: COMPETING IN THENEW INTERNATIONAL ECONOMY
4
time, that we started suing each other less, and caring for each
other more.//
That is why I have sent Congress comprehensive legislation
to reform our Civil Justice System. It is complete with specific
proposals. We want to solve more disputes early -- before they
DISCOVERY (DaJ)
get dragged into the courtroom.// We want to speed the legal
JOHN
process -- there is no reason anyone can go through law school
HOWARD
faster than it takes a court to reach a verdict. We want to put
SWITS (DIN HONARD) OUP
a lid on outrageous punitive damages, that strike terror into
every mom and dad who wants to coach their kid's football team.
EXPERIMENT WITH (DOJ)
And here's one big idea. I believe we should copy a practice
IN APPROPRIATE CASES (PORTER - "WE ARE TRYING THS ORT IN FEDERAL
from our friends in Britain -- and make the loser pay the DIVERSITY CASES ONLY. NE
HAVE ALSO ADVANCED IT
WHERE SETTLEMENT REFUSED
winner's court fees. You think that T-shirt company would have AND COURT VEROL
(JOHN
)
brought CRAZY LAWSUIT AGAINST THAT (JOHN HOWARD) OVP
SHOWS OFFER WAS
HOWARD
sued that referee -- if they'd known they'd end up footing his FAIR. NOT YET
OVP
ADVICATED FOR
legal bills?//
EVERY CASE.)
This is one part of the crisis in our civil justice system.
But we also need change in our product liability laws. These are
the laws that are supposed to allow people to be compensated for
harm caused to them by a defective product. That's an important
right, and I am all for it. People ought to receive fair
compensation when a product is defective and they get hurt.
But like so much of our civil justice system, product
liability has careened out of control.
from
Let me give you an example of what I'm talking about: The
Pice
Will-Burt Corporation of Orville, Ohio stopped making parts for
testimone
Hearing
ladders, scaffolds, and aircraft -- because the products
excepts.,199
Nov. Senate COMPETITION Bis.
5
encountered potential liability costs. But the workers paid an
even higher price -- the company was forced to close plants and
lay off 80 employees.
Here's the problem. The product liability laws vary from Pice MAY 1992
state to state and the rules have encouraged crazy lawsuits, and
outrageous awards. The cost of defending these lawsuits has
escalated. A lot of trial lawyers bring lawsuits, knowing that
it is cheaper for companies to settle the case than to pay their
own lawyers to defend them through trial. And the cost of
insurance keeps skyrocketing.
Big deal, right? So companies have to pay extra for a few
lawyers. But it's not just companies who foot the bill, we all
pay higher prices -- for everything from medicine to step
-
ladders.
It's worse than that. We've never seen a lot of good
FROM pice
products -- because companies are afraid of liability.
MAY 1992
JOHN
In Europe, for example, Volvo offers parents a car seat --
DELETE GRAP
HOWARD-
built right in the car. You can't buy one in the U.S. today --
JOHN HENARD
OUP-
OUP
is WORRIED
and may never be able to. No company wants to deal with our
ABOUT
Both SUGGESTS ERAPH/S
laws.
DELETE GRAH
And if you're in Europe, and you suffer from AIDS, you can
BELAUSE CLARYSLER oF
BHN HOWAR
get medical treatment you can't get in the United States.
orp
BLINI-VAN
Medical companies are afraid of the liability.
BE
But it's all worth it right, because when someone does get
FEELS AND you CURED IN CAN'T THE EUROP IT OF TE AMPS happening.
hurt, they can a big settlement? Again, that's not what's
(DOJ CAN'T VERIFY LAWYERS TAKE IN PRODUCTS UABLITY CASES HEARD By JURIES)
More than half of all the money awarded by juries in
GET IN STRENT TROUBLE
6
product liability cases, goes not to the injured party, but to
(DOJ) NEARLY (42%) DOJ
the lawyers.
Think about that. More than half of all the awards
-- ends up in the pockets of Brooks Brothers suits.
But here's the real problem. Our product liability system
is killing our economic competitiveness.
Liability costs are 15 times greater than that in Japan,
PLCC
MAY1992
and 20 times greater than that in Europe. Our businesses --
especially our small businesses -- are staggering under a weight
USBIS
our competitors don't even carry.
Every dollar we spend around a courtroom, is a dollar we
won't spend on training, education, research, investment. It
will be the difference between no jobs for our kids -- and good
jobs for our kids.
STAFFING
We have to do something about this -- if we want our kids to
have job. Luckily, Senator Bob Kasten understands this. He has
CAUD
been the fighter to change the system.
Bob has put forth a plan -- which I have endorsed -- to
speed the legal process -- and settle more cases out of court --
which will help everyone.
We want uniformity in product liability law -- instead of
PLCC
the confusing 51 separate standards we have today. We want to
MAY1998
have the same rules for damages from one state to the next. We
want to bring some rationality to the system.
Our plan is pro-consumer, pro-business, pro-safety, and pro-
jobs. The day my pen signs Senator Kasten's bill -- is the day
our workers get a leg up on other workers.
7
So what's the problem? Why do we still face this crisis?
Bob Kasten will tell you the problem. The Gridlock Congress.
I know you are sick of the blame-game in Washington, but we
can't ignore the facts.
Like my opponent, Mr. Clinton -- many members of Congress
get their campaign funds from trial lawyer organizations. Here's
DAVID TELL/
what one Arkansas trial lawyer wrote about my opponent -- trying
RNC
to raise money for the Clinton campaign: "I can never remember
AND
an occasion where he failed to do what was right where we trial
WALL
STREET
lawyers are concerned." So for my opponent and in many
Congressional offices -- the only thing that gathers more
8/27/92
attention than a TV camera -- is a lawyer in tasselled loafers
with a check in hand.
That's why product liability reform has been blocked, for
almost two decades. In fact, trial lawyers' money has prevented
STAFFING
COMMENTS
product liability from ever even coming to a full vote.
(REDINI)
But this very week, we have a chance -- to stop undermining
CALLO
our American workers.
Product liability reform will be up before the U.S. Senate.
STAFFING
COMMENS
We believe we have the votes -- to pass the Senate.
PORTER CACIO
But there's a legal catch -- something called "cloture."
Now cloture sounds like something a doctor would give you after
SENATES ( FROM WHEVER
STARRING
you cut your knee. But it's not. It's the number of votes it
WROTE N RED
INK ONLY 3
PERMIT A VOTE (RED WK)
PAGES OF COMMES
CALLO
takes to stop long winded debate in the U.S. Congress. (As you P. 7-9)
can imagine, getting Congress to stop talking about anything
8
requires some effort. In fact, it takes more votes to get them
to stop talking -- than to pass a bill.)
While we have a majority of the Senate on our side and your
side, we're not sure we have the extra votes for cloture. So
CAUS
here's the irony -- Congress and the trial lawyers may be able to
stop the most-needed legal reform in a decade -- by using a legal
loophole.
Bob Kasten doesn't want that to happen -- and neither do I.
I'd like to wrap up a Labor Day present for the American economy,
and for the jobs of the future.
I need you to get on the phone and let Congress know, the
American people are tired of paying for crazy lawsuits. Tired of
high prices. Tired of unsafe products. Most of all, we're tired
of losing jobs to foreign competitors./
What troubles me so about our litigation crisis, is that it
is so at odds with the true nature of America.
[Revised conclusion]
But what would have happened -- if Columbus had sued the
a
sailmakers of the Santa Maria? What if immigrants in 1903 had
tried to win pain and suffering damages -- because the floor on
But WHEN PEOPLE ARE
Ellis Island had hurt their backs?
INJURED By DEFECTIVE
PRODUCTS, THEY SHOULD BE
We cannot rid our world of risk, nor do we want to. A Today, COMPENSATED
WE NEED A
RATIONAL
I appeal to the common sense of the American people -- to take a PRODUCTLIAR
SYSTEM THAT
stand for America's values, and give our workers a chance to
PROTECTS CONSUMER
WITHOUT MAKINE
INNOVATION IMPOSSIBLE
compete in the world economy.
(REDINE AGAIN,
9
Thank you for listening. God bless Wisconsin. God bless
the United States of America.
# # #
-SUSAN DREYFUS -
- 414-
544 1104 (home)
<
3032 Walden Circle
Wankasha, WI. 53188
BRIAN DAKE
FAX-
I
414-821-11996
Gov., Drayfus / grandayte And FLOTHS/BOTH.
Red vest
D testim to Bobby
L7
Shsan stulf
LT
K
THE
200ml
(*******
STREET I
OFFICE OF PRESIDENTIAL SPEECHWRITING
FACSIMILE TRANSMITTAL SHEET
Number of Pages (Including Cover)
6
To
MR. BRIAN DAKE
Fax Number
414-821-1996
Date
10 SEPTEMBER 1992
From
JEANNIE BUNTON
Office Number
202-456-7750
******
COMMENTS
As PROMISED. AGAIN, MANY THANKS FOR your
HELP AND
Office of the Press Secretary
(Hamtramck, Michigan)
For Immediate Release
September 7, 1992
REMARKS BY THE PRESIDENT
AT GOP LABOR DAY PICNIC
Waukesha County Exposition Grounds
Waukesha, Wisconsin
10:16 A.M. CDT
THE PRESIDENT: Thank you so much. What a marvelous
turnout. Waukesha knows how to do it. Thank you all very much.
(Applause.) Barbara and I are delighted to be here. And may I thank
our great United States Senator Bob Kasten, and say how lucky we are
to have him and Eva in Washington, D.C. Two of the best. Please get
out there and work hard in November. We've got to get more like him
in the Senate. (Applause.)
And, of course, you heard from one of the great
governors in this country, Tommy Thompson, your own. I salute him
and Sue Ann. I don't believe I've got a better supporter out there
than Tommy Thompson. (Applause.)
And may I greet Jim Sensenbrenner. If we had more like
him in the Congress you wouldn't have everybody yelling "Clean
House." He's right. Most of them are wrong. We do need to clean
House. (Applause.)
And that brings me to Joe Cook. I'd like to see him
elected to the Congress. And then, of course, John MacIver, an old
friend who has been in these political trenches with me and Tommy and
Bob Kasten for a long time. We salute him. Here's a guy who rolls
up his sleeves, like so many of you, and just goes to work for what
he believes. And it's a great part of American politics. And I
salute him and every other volunteer out there doing the Lord's work.
We are going to win because of all of you. (Applause.)
Barbara and I started this morning up at the Mackinac
Bridge in Michigan. And with us today, incidentally, is Michigan's
Governor John Engler over there -- another great Republican. John.
(Applause.) We had a brisk 50-minute walk across that magnificent
Mackinac Bridge. so when we say it's great to be at a picnic we know
what we're talking about. It's nice to be here -- no more walks.
Now, this Labor Day we gather at a triumphant moment in
history. I can stand before you this morning and can say something
no other President could ever say: The cold war 1s over and freedom
finished first. (Applause.)
But America is not a nation that brags, not a nation
that looks behind -- we are loyal only to the future. So this Labor
Day, we must rededicate ourselves to the future of all who punch the
time clock, pay the bills, sweat it out at tax time. Our number one
priority must be to period ICL the ing men and
women of this great country of ours. (Applause.)
And today is the kick-off day for these campaigns. I
think the American people feel this one has been going on about 10
months too long -- and so do I. But nevertheless, this is the
official kick-off day. My opponent will kick off his campaign with a
message of fear, telling us that our country is in decline. But I
ask you to look beneath the rhotoric and look at the facts.
MORE
Governor Clinton will tell you that we're a nation in
decline, slipping past Germany, headed south towards Sri Lanka, to
use his words. Wrong, absolutely wrong, Governor Clinton.
(Applause.) The world's most productive workers are not in Germany.
They are not in Japan. They are right here in the United States of
America. A lot of them right here today in Wisconsin. (Applause.)
And Governor Clinton will tell you that American wages
are slipping. And he doesn't mention that since 1985, our workers
have earned bigger paychecks and benefits than any other workers in
the world. And I want to see them even better. (Applause.)
Governor Clinton says that people are working harder for less. He
won't mention that adjusted personal income is higher than it was
four years ago. That's because inflation -- the thief of the middle
class -- has been securely locked away. (Applause.)
NOW, does this mean all is fine in America? of course
not. But at a time of uncertainty, a time of wrenching global
challenge, Governor Clinton wants to scare American workers so that
he can slip into office -- with the failed tax-and-spend policies of
the past. Last night -- I don't know if any of you heard that Tom
Brokaw show -- but last night the Governor appeared on the Brokaw
show, and the first words out of his mouth were: "I have advocated a
tax increase." Well, Governor, that is the wrong prescription for
America. (Applause.)
He offers a treasure trove of new government programs
that will cost at least $220 billion more of your money. I say you
already give too much to the tax man. (Applause.) And he wants to
raise taxes by $150 billion -- just to start; that's just for
openers. I want to cut them and get the economy started in high
gear. (Applause.)
You heard what Bob Kasten said; he's right. We've been
trying to get through this gridlocked Congress some incentives that
he and I believe in -- locked because of the old thinking of the
Democratic leadership that's been in power for 38 years. So as this
campaign gets into full swing, I make one promise. I will talk about
real ideas -- of making health care available to the poorest of the
poor, controlling what you pay when you go to a doctor. About
reforming welfare, giving our kids what they deserve -- the world's
very best schools. (Applause.) My policies will strengthen the most
important institution in our nation -- and I am talking about the
American family. (Applause.)
The liberals are trying to back us away from discussing
how to strengthen the family. And we are going to stay with it.
America knows that the family is slipping and we want to help
strengthen it by child care and by support for these school choice
and whatever it is -- welfare reform. so let's keep talking about
what America needs -- strengthening the American family. (Applause.)
But today, as Governor Thompson said, I want to talk
about another roadblock in the way of you and your families' economic
security -- our crazy, out-of-control legal system. Don't just ask
me about what's wrong with our legal system. Check the opinion of
that famous enforcer of American justice. I'm not talking about
Oliver Wendell Holmes or John Marshall. I mean someone even more
famous than that: Hulk Hogan. (Laughter.)
My grandkids tell me that in his movie last year Hulk
Hogan was confronted with the prodictable crop of bad guys. Only the
bad guys refused to fight. Instead they said, "This is the '90s --
we're not going to fight you. We are going to sue you." (Laughter.)
Well, I believe that one statement sums up a lot of what
is wrong in America today. You pick up the newspaper and the stories
roll on out at you. Like the story about a basketball -- true story
MORE
-- about a basketball referee who made a controversial call at the
buzzer of a Purdue-Iowa basketball game. Purdue won, and an Iowa
souvenir company was suddenly left with a lot of victory souvenirs
that weren't in all that much demand. so what did the company do?
They sued the referee. sound crazy? Well, it took two years and a
lot of money before the case was dismissed by the state Supreme
Court.
Now, understand, law is a noble and honorable
profession. But most good lawyers will tell you that the system is
out of control. In the past 20 years, the number of civil lawsuits
filed in federal courts has more than doubled. Today, the average
case takes almost a year to be resolved -- and in the past year alone
the number of cases were pending for three years -- increased by
nearly 15 percent.
That means you can file a suit, have time to enroll in a
law school, study three years, graduate, pass the bar, and then
represent yourself in court on the day the decision is handed down.
(Applause.) NOW, come on.
The NAM, the National Association of Manufacturers, has
just finished looking at what this litigation explosion costs our
economy. According to a soon-to-be-released study, American
consumers and companies will spend up to $200 billion on legal
services this year -- $200 billion dollars! American businesses now
spend more on insurance and legal fees than on training and preparing
our workers for the new economy. And that is crazy. (Applause.) As
a nation, I believe it's high time that we started suing each other
less and caring for each other more. (Applause.)
I have proposed a comprehensive plan to reform our civil
justice system. And we reform our product liability laws. And these
laws allow people to be compensated for harm caused by a defective
product. People ought to receive fair compensation when a product is
defective and they get hurt. But like so much of our civil justice
system, product liability has careened out of control.
Let me give you just one example. The Will-Burt
Corporation of Orville, Ohio, stopped making parts for ladders and
scaffolds and aircraft because they couldn't afford the liability
insurance. That was bad news for the company's owners -- but worse
news for the 80 employees, all of whom got pink slips.
Here is the problem. The product liability laws vary
from state to state and the rules have encouraged these crazy
lawsuits and outrageous awards. And the cost of insurance keeps
going right out through the roof, keeps skyrocketing.
Big deal, right? So companies have to pay extra for a
few lawyers. But it's not just companies who foot the bill, we all
pay higher prices for everything from medicine to step ladders. We
never get to see a lot of good products because companies are afraid
of excessive lawsuits. (Applause.)
Get this. Almost half of all the money paid out in
these kind of cases goes not to the injured party, but to the
lawyers. I don't want to see only lawyers getting rich, I want to
see American workers getting rich. And that's the problem.
(Applause.)
Our product liability system is killing our economic
competitiveness -- costing Americans secure jobs that you deserve.
our liability costs are many times greater than in Japan and in
Europe. Every dollar we spend all around the courtroom is a dollar
we won't spend on training, education, research, investment. It
could be the difference between no jobs for our kids and good jobs
for our kids. (Applause.)
MORE
NOW, we have to do something about this. Luckily, your
great Senator, Bob Kasten, understands this. He has been fighting to
change the system. And he has put forth a plan, which I am for,
working with him on, to speed the legal process -- settle more cases
out of court and bring some rationality to the product liability
system. Once again, a Wisconsin man is in the lead. (Applause.)
Our plan is pro-consumer, pro-business, pro-safety, and
pro-jobs. The day my pen signs Senator Kasten's bill is the day we
stop undermining the American worker that we salute today on Labor
Day. (Applause.)
so why then, if we have all these problems, do we face
this crisis? Bob Kasten will tell you in three words -- the
gridlocked Congress. And that's why I'm here today.
Forty-four years ago next month, another incumbent
President came through Waukesha. His name was Harry S. Truman. Now,
I admit it, Harry and I don't have everything in common. (Laughter.)
He believed in bigger government -- I don't share that view. But
quite frankly, I voted against Truman that year. But still there are
some similarities between us.
I've just read that fascinating book, this big, fat book
on Truman -- a marvelous biography. Harry Truman ran a small
business. He knew what it was to meet a payroll, to work for a
living in the private sector. And so do I. (Applause.) Harry
Truman wanted to join the military and fight for his country. I so
do I, and I did. (Applause.) Harry Truman ran as an underdog --
just as I am. And he liked it, and so do I. (Applause.) Harry
Truman admitted when he made a mistake. And God knows I've done the
same thing, and I've admitted it. (Applause.)
But most of all, Harry Truman was frustrated by what he
called the "do-nothing" Congress. Listen to Truman's very own words
from right here in this very town 44 years ago. "When I say do-
nothing, I mean they" -- meaning Congress -- "have done nothing for
the people. They have not listened to the people's demands."
Now, the gridlocked Congress hasn't listened to people
either. One example: I favor a balanced budget amendment. so do
you. The Congressman from this very district sponsored the balanced
budget amendment, and then turned around and voted against his own
amendment on the House floor. That's what I mean when I say
gridlocked Congress. Clean House. (Applause.)
For years, Americans have complained about this crazy
legal system, but once again the gridlocked Congress has refused to
act on my reforms -- or on Bob Kasten's reforms. Later this week; we
finally get a Senate vote on the product liability reform. My
message to the gridlocked Congress is simple. Either fix our legal
system -- stop undermining our workers -- or we're going to take a
broom and do some spring cleaning in November, because we are going
to clean House. (Applause.)
Send me some good leaders who will listen to the people,
the way this Senator does. Elect Joe Cook to the House of
Representatives. Help clean House. That's the message.
They talk about change -- change the one institution
that hasn't budged for 38 years. Change the House. (Applause.)
Well we're going to clean House -- not just so companies
spend less time paying lawyers, more time creating jobs. Not just so
moms and dads can coach Little League without fear of some crazy
lawsuit. We're going to clean House so we bring down health care
costs, so we improve our schools, we take back our streets from the
criminals, and we start backing up our law enforcement officials more
and more. (Applause.)
MORE
NOW, before I finish it's worth mentioning that while
I'm in Waukesha this morning, my opponent -- guess where he is --
he's in Harry Truman's hometown -- in Independence, Missouri. So
let's just have some plain speaking about Bill Clinton -- Governor
Bill Clinton -- and Harry Truman.
Harry Truman never engaged in double-speak. He told
people the truth, not merely what they wanted to hear. Compare that
to Governor Clinton's position on reforming our legal system. The
head of the lawyers -- the head of the trial lawyers in Arkansas --
Trial Lawyers Association -- said Governor Clinton has -- and I quote
-- "always done what is right for the trial lawyers." I bet Harry
Truman would have done what is right for the American people, not for
the trial lawyers. (Applause.)
Whether it was the Soviet blockade of Berlin, or the
invasion of Korea, Harry Truman never flinched from the tough
decision. Now, contrast that with Governor Clinton's waffling and
wavering about whether he would have followed my lead and stood up to
Saddam Hussein and his naked aggression. (Applause.)
Harry Truman prided himself on his own military service,
and he frequently visited veterans associations and spoke with great
pride about his service to his country.
Last but not least, Harry Truman believed America could
not turn our back on the rest of the world, even despite the
challenges here at home. Governor Clinton virtually ignores foreign
policy, and flirts with the dangerous idea of sticking America's head
in protectionist sands.
Harry Truman said "the buck stops here." On issue after
issue, Governor Clinton says "first, lets blame George Bush," and
then "I'll get back to you later with an answer.' (Applause.) I'll
tell you, if the bucks stops there, than Governor Clinton is offering
devalued currency. (Laughter.)
Harry Truman was a man of decisiveness, not
equivocation. He'd find little in common with Governor Clinton, a
man who hedges or ducks on almost every tough issue; a man who seems
to feel strongly on both sides of almost every issue that are before
this great nation.
I found out something in the Oval Office. You can't
have it both ways. You've got to call it as you see it. You have to
make the tough decision and then pay the consequences or get the
credit. But you can't be on every side of every issue, waffling
around and call that leadership. That is not leadership.
(Applause.)
You know, many people thought Harry Truman would lose in
1948. But he said what was in on his mind, he didn't worry about the
press, and he never lost faith in the United States of America.
I stand before you with the same passion and that same
faith. I will talk about ideas for the next 57 days. Ideas that
matter. Ideas that can deal with the real challenges facing this
country. Ideas that won't make everyone happy, but that will be
right for the United States of America.
And like Harry Truman, I believe a new age of America
beckons, and that we can reap the benefits. with your help, come
November we will match our global victory with economic security here
at home.
Thank you all for being here And may God bless the
United States of America on this very, very special day. Thank you
all. (Applause.)
ND
10:40 A.M. CDT
Office of the Press Secretary
(Hamtramck, Michigan)
For Immediate Release
September 7, 1992
REMARKS BY THE PRESIDENT
AT GOP LABOR DAY PICNIC
Waukesha County Exposition Grounds
Waukesha, Wisconsin
10:16 A.M. CDT
THE PRESIDENT: Thank you so much. What a marvelous
turnout. Waukesha knows how to do it. Thank you all very much.
(Applause.) Barbara and I are delighted to be here. And may I thank
our great United States Senator Bob Kasten, and say how lucky we are
to have him and Eva in Washington, D.C. Two of the best. Please get
out there and work hard in November. We've got to get more like him
in the Senate. (Applause.)
And, of course, you heard from one of the great
governors in this country, Tommy Thompson, your own. I salute him
and Sue Ann. I don't believe I've got a better supporter out there
than Tommy Thompson. (Applause.)
And may I greet Jim Sensenbrenner. If we had more like
him in the Congress you wouldn't have everybody yelling "Clean
House." He's right. Most of them are wrong. We do need to clean
House. (Applause.)
And that brings me to Joe Cook. I'd like to see him
elected to the Congress. And then, of course, John MacIver, an old
friend who has been in these political trenches with me and Tommy and
Bob Kasten for a long time. We salute him. Here's a guy who rolls
up his sleeves, like so many of you, and just goes to work for what
he believes. And it's a great part of American politics. And I
salute him and every other volunteer out there doing the Lord's work.
We are going to win because of all of you. (Applause.)
Barbara and I started this morning up at the Mackinac
Bridge in Michigan. And with us today, incidentally, is Michigan's
Governor John Engler over there -- another great Republican. John.
(Applause. ) We had a brisk 50-minute walk across that magnificent
Mackinac Bridge. so when we say it's great to be at a picnic we know
what we're talking about. It's nice to be here -- no more walks.
Now, this Labor Day we gather at a triumphant moment in
history. I can stand before you this morning and can say something
no other President could ever say: The cold war is over and freedom
finished first. (Applause.)
But America is not a nation that brags, not a nation
that looks behind -- we are loyal only to the future. So this Labor
Day, we must rededicate ourselves to the future of all who punch the
time clock, pay the bills, sweat it out at tax time. Our number one
priority must be to Mild Ect the working men and
women of this great country of ours. (Applause.)
And today is the kick-off day for these campaigns. I
think the American people feel this one has been going on about 10
months too long -- and so do I. But nevertheless, this is the
official kick-off day. My opponent will kick off his campaign with a
message of fear, telling us that our country is in decline. But I
ask you to look beneath the rhotoric and look at the facts.
MORE
Governor Clinton will tell you that we're a nation in
decline, slipping past Germany, headed south towards Sri Lanka, to
use his words. Wrong, absolutely wrong, Governor Clinton.
(Applause.) The world's most productive workers are not in Germany.
They are not in Japan. They are right here in the United States of
America. A lot of them right here today in Wisconsin. (Applause.)
And Governor Clinton will tell you that American wages
are slipping. And he doesn't mention that since 1985, our workers
have earned bigger paychecks and benefits than any other workers in
the world. And I want to see them even better. (Applause.)
Governor Clinton says that people are working harder for less. He
won't mention that adjusted personal income 18 higher than it was
four years ago. That's because inflation -- the thief of the middle
class -- has been securely locked away. (Applause.)
NOW, does this mean all is fine in America? of course
not. But at a time of uncertainty, a time of wrenching global
challenge, Governor Clinton wants to scare American workers so that
he can slip into office -- with the failed tax-and-spend policies of
the past. Last night -- I don't know if any of you heard that Tom
Brokaw show -- but last night the Governor appeared on the Brokaw
show, and the first words out of his mouth were: "I have advocated a
tax increase." Well, Governor, that is the wrong prescription for
America. (Applause.)
He offers a treasure trove of new government programs
that will cost at least $220 billion more of your money. I say you
already give too much to the tax man. (Applause.) And he wants to
raise taxes by $150 billion -- just to start; that's just for
openers. I want to cut them and get the economy started in high
gear. (Applause.)
You heard what Bob Kasten said; he's right. We've been
trying to get through this gridlocked Congress some incentives that
he and I believe in -- locked because of the old thinking of the
Democratic leadership that's been in power for 38 years. so as this
campaign gets into full swing, I make one promise. I will talk about
real ideas -- of making health care available to the poorest of the
poor, controlling what you pay when you go to a doctor. About
reforming welfare, giving our kids what they deserve -- the world's
very best schools. (Applause.) My policies will strengthen the most
important institution in our nation -- and I am talking about the
American family. (Applause.)
The liberals are trying to back us away from discussing
how to strengthen the family. And we are going to stay with it.
America knows that the family is slipping and we want to help
strengthen it by child care and by support for these school choice
and whatever it is -- welfare reform. So let's keep talking about
what America needs -- strengthening the American family. (Applause.)
But today, as Governor Thompson said, I want to talk
about another roadblock in the way of you and your families' economic
security -- our crazy, out-of-control legal system. Don't just ask
me about what's wrong with our legal system. Check the opinion of
that famous enforcer of American justice. I'm not talking about
Oliver Wendell Holmes or John Marshall. I mean someone even more
famous than that: Hulk Hogan. (Laughter.)
My grandkids tell me that in his movie last year Hulk
Hogan was confronted with prodictable crop of bad guys. only the
bad guys refused to fight. Instead they said, "This is the '90s --
we're not going to fight you. We are going to sue you." (Laughter.)
Well, I believe that one statement sums up a lot of what
is wrong in America today. You pick up the newspaper and the stories
roll on out at you. Like the story about a basketball -- true story.
MORE
-- about a basketball referee who made a controversial call at the
buzzer of a Purdue-Iowa basketball game. Purdue won, and an Iowa
souvenir company was suddenly left with a lot of victory souvenirs
that weren't in all that much demand. So what did the company do?
They sued the referee. Sound crazy? Well, it took two years and a
lot of money before the case was dismissed by the state Supreme
Court.
NOW, understand, law is a noble and honorable
profession. But most good lawyers will tell you that the system is
out of control. In the past 20 years, the number of civil lawsuits
filed in federal courts has more than doubled. Today, the average
case takes almost a year to be resolved -- and in the past year alone
the number of cases were pending for three years -- increased by
nearly 15 percent.
That means you can file a suit, have time to enroll in a
law school, study three years, graduate, pass the bar, and then
represent yourself in court on the day the decision is handed down.
(Applause.) Now, come on.
The NAM, the National Association of Manufacturers, has
just finished looking at what this litigation explosion costs our
economy. According to a soon-to-be-released study, American
consumers and companies will spend up to $200 billion on legal
services this year -- $200 billion dollars! American businesses now
spend more on insurance and legal fees than on training and preparing
our workers for the new economy. And that is crazy. (Applause.) As
a nation, I believe it's high time that we started suing each other
less and caring for each other more. (Applause.)
I have proposed a comprehensive plan to reform our civil
justice system. And we reform our product liability laws. And these
laws allow people to be compensated for harm caused by a defective
product. People ought to receive fair compensation when a product is
defective and they get hurt. But like so much of our civil justice
system, product liability has careened out of control.
Let me give you just one example. The Will-Burt
Corporation of Orville, Ohio, stopped making parts for ladders and
scaffolds and aircraft because they couldn't afford the liability
insurance. That was bad news for the company's owners -- but worse
news for the 80 employees, all of whom got pink slips.
Here is the problem. The product liability laws vary
from state to state and the rules have encouraged these crazy
lawsuits and outrageous awards. And the cost of insurance keeps
going right out through the roof, keeps skyrocketing.
Big deal, right? So companies have to pay extra for a
few lawyers. But it's not just companies who foot the bill, we all
pay higher prices for everything from medicine to step ladders. We
never get to see a lot of good products because companies are afraid
of excessive lawsuits. (Applause.)
Get this. Almost half of all the money paid out in
these kind of cases goes not to the injured party, but to the
lawyers. I don't want to see only lawyers getting rich, I want to
see American workers getting rich. And that's the problem.
(Applause.)
our product liability system is killing our economic
competitiveness -- costing Americans secure jobs that you deserve.
our liability costs are many times greater than in Japan and in
Europe. Every dollar we spend all around the courtroom is a dollar
we won't spend on training, education, research, investment. It
could be the difference between no jobs for our kids and good jobs
for our kids. (Applause.)
MORE
Now, we have to do something about this. Luckily, your
great Senator, Bob Kasten, understands this. He has been fighting to
change the system. And he has put forth a plan, which I am for,
working with him on, to speed the legal process -- settle more cases
out of court and bring some rationality to the product liability
system. Once again, a Wisconsin man is in the lead. (Applause.)
Our plan is pro-consumer, pro-business, pro-safety, and
pro-jobs. The day my pen signs Senator Kasten's bill is the day we
stop undermining the American worker that we salute today on Labor
Day. (Applause.)
so why then, if we have all these problems, do we face
this crisis? Bob Kasten will tell you in three words -- the
gridlocked Congress. And that's why I'm here today.
Forty-four years ago next month, another incumbent
President came through Waukesha. His name was Harry S. Truman. Now,
I admit it, Harry and I don't have everything in common. (Laughter.)
He believed in bigger government -- I don't share that view. But
quite frankly, I voted against Truman that year. But still there are
some similarities between us.
I've just read that fascinating book, this big, fat book
on Truman -- a marvelous biography. Harry Truman ran a small
business. He knew what it was to meet a payroll, to work for a
living in the private sector. And so do I. (Applause.) Harry
Truman wanted to join the military and fight for his country. I so
do I, and I did. (Applause.) Harry Truman ran as an underdog --
just as I am. And he liked it, and so do I. (Applause.) Harry
Truman admitted when he made a mistake. And God knows I've done the
same thing, and I've admitted it. (Applause.)
But most of all, Harry Truman was frustrated by what he
called the "do-nothing" Congress. Listen to Truman's very own words
from right here in this very town 44 years ago. "When I say do-
nothing, I mean they" -- meaning Congress -- "have done nothing for
the people. They have not listened to the people's demands."
Now, the gridlocked Congress hasn't listened to people
either. One example: I favor a balanced budget amendment. so do
you. The Congressman from this very district sponsored the balanced
budget amendment, and then turned around and voted against his own
amendment on the House floor. That's what I mean when I say
gridlocked Congress. Clean House. (Applause.)
For years, Americans have complained about this crazy
legal system, but once again the gridlocked Congress has refused to
act on my reforms -- or on Bob Kasten's reforms. Later this week, we
finally get a Senate vote on the product liability reform. My
message to the gridlocked Congress is simple. Either fix our legal
system -- stop undermining our workers -- or we're going to take a
broom and do some spring cleaning in November, because we are going
to clean House. (Applause.)
Send me some good leaders who will listen to the people,
the way this Senator does. Elect Joe Cook to the House of
Representatives. Help clean House. That's the message.
They talk about change -- change the one institution
that hasn't budged for 38 years. Change the House. (Applause.)
Well we're going to clean House -- not just so companies
spend less time paying lawyers, more time creating jobs. Not just so
moms and dads can coach Little League without fear of some crazy
lawsuit. We're going to clean House so we bring down health care
costs, so we improve our schools, we take back our streets from the
criminals, and we start backing up our law enforcement officials more
and more. (Applause.)
MORE
NOW, before I finish it's worth mentioning that while
I'm in Waukesha this morning, my opponent -- guess where he is --
he's in Harry Truman's hometown -- in Independence, Missouri. so
let's just have some plain speaking about Bill Clinton -- Governor
Bill Clinton -- and Harry Truman.
Harry Truman never engaged in double-speak. He told
people the truth, not merely what they wanted to hear. Compare that
to Governor Clinton's position on reforming our legal system. The
head of the lawyers -- the head of the trial lawyers in Arkansas --
Trial Lawyers Association -- said Governor Clinton has -- and I quote
-- "always done what is right for the trial lawyers." I bet Harry
Truman would have done what is right for the American people, not for
the trial lawyers. (Applause.)
Whether it was the Soviet blockade of Berlin, or the
invasion of Korea, Harry Truman never flinched from the tough
decision. NOW, contrast that with Governor Clinton's waffling and
wavering about whether he would have followed my lead and stood up to
Saddam Hussein and his naked aggression. (Applause.)
Harry Truman prided himself on his own military service,
and he frequently visited veterans associations and spoke with great
pride about his service to his country.
Last but not least, Harry Truman believed America could
not turn our back on the rest of the world, even despite the
challenges here at home. Governor Clinton virtually ignores foreign
policy, and flirts with the dangerous idea of sticking America's head
in protectionist sands.
Harry Truman said "the buck stops here." on issue after
issue, Governor Clinton says "first, lets blame George Bush," and
then "I'll get back to you later with an answer." (Applause.) I'll
tell you, if the bucks stops there, than Governor Clinton is offering
devalued currency. (Laughter.)
Harry Truman was a man of decisiveness, not
equivocation. He'd find little in common with Governor Clinton, a
man who hedges or ducks on almost every tough issue; a man who seems
to feel strongly on both sides of almost every issue that are before
this great nation.
I found out something in the Oval Office. You can't
have it both ways. You've got to call it as you see it. You have to
make the tough decision and then pay the consequences or get the
credit. But you can't be on every side of every issue, waffling
around and call that leadership. That is not leadership.
(Applause.)
You know, many people thought Harry Truman would lose in
1948. But he said what was in on his mind, he didn't worry about the
press, and he never lost faith in the United States of America.
I stand before you with the same passion and that same
faith. I will talk about ideas for the next 57 days. Ideas that
matter. Ideas that can deal with the real challenges facing this
country. Ideas that won't make everyone happy, but that will be
right for the United States of America.
And like Harry Truman, I believe a new age of America
beckons, and that we can reap the benefits. With your help, come
November we will match our global victory with economic security here
at home.
Thank you all for being here And may God bless the
United States of America on this very, very special day. Thank you
all. (Applause.)
END
10:40 A.M. CDT
5 SEPTEMBER 1992
MEMORANDUM FOR CHRISTINA MARTIN
STEVE PROVOST
FROM:
J. BUNTON R
SUBJECT:
FACT CHANGES/CONCERNS RE: LEGAL REFORM
P. 2 --- In 1988, Rawlings became the 18th company in 18 years to
quit the helmet bis
we shouldn't say "over the past 18 years
--- it's been four years since Rawlings became the 18th in 18.
p. 3 --- should qualify American business spends more on --- than
on "either informal or formal" training "to prepare" our
workers
Based on chart from 9/90 study for Congress "Worker Training:
Competing in the New International Economy
total training [formal and informal combined] in two studies can
be as high as $210 billion -- you'll note however neither inform
nor formal separately exceed $200 billion --- according to the
chart.
p.
5
--- John Howard [OVP-Counsel] worried about both graphs I've
indicated
--- so am I. They should be deleted. He's worried
cause -- Chrysler Co. here is the good ole USA already makes
built-in car seats why would we mention a foreign competitor ---
He thinks Aids graph is just gonna get POTUS in trouble. I can't
verify that the fact is true.
For what it's worth [p. 7-8 --- I presume the language on Sen.
Kasten and his "bill" is from Calio.]
FAXED THROUGH SIT RM. TO C. MARTIN
C'VILLE - TOHERROOM -
B 9/5/92
10:10pm
FACT CHANGE MASTER
14
Provost/Bunton
*w/zoellick changes
Sept. 5, 1992 / 3:30 p.m.
Presidential Remarks
Waukesha County Picnic
Waukesha, Wisconsin
Monday, Sept. 7, 1992
Thank you Governor Tommy Thompson.
Today is Labor Day -- the day we honor American workers --
the most productive men and women in the entire world.
So today, I want to talk to you about a problem that affects
you and every other worker -- our crazy, out-of control - legal
system.
A serious discussion about legal reform may seem a little
odd as a topic for a picnic. But I think you deserve more than
talk from your political leaders -- you need answers. Answers to
BULLD UPON YOR
STRENGTHS AND
the most pressing question before America today -- how can we V
(FORSER)
guarantee that we will remain not just a military superpower --
but an export superpower, and an economic superpower.//
As I see it, our current legal system is a roadblock that
must be cleared from the path of America's economic progress.
Let me start by talking about a famous American enforcer of
justice. I don't mean Oliver Wendell Holmes or John Marshall.
I mean someone more famous than that. I mean -- Hulk Hogan.//
My grandkids tell me that in his movie last year -- Hulk
Hogan was confronted with the predictable crop of bad guys. Only
the bad guys refused to fight Hulk. Instead they said, "this is
FYI- HOGAN'S MOVE "SHBURBAN AUTHANDO WAS PATED PG
2
the nineties -- we're not going to fight you. We are going to
sue you. "
I fear that one statement, sums up a lot of what is
troubling America today.
Pick up the newspaper, the stories roll out at you.
Like by the now famous story about the basketball referee,
who made a controversial call at the buzzer of a Purdue-Iowa
basketball game. Purdue won the game, and an Iowa souvenir
company was suddenly left with victory T-shirts that weren't in
all that much demand. So what did the company do? They sued the
referee. Sound crazy? It took two years, and a lot of money,
before the case was dismissed by the State Supreme Court.
Are these crazy legal stories just intended to give us
something to make our friends chuckle at backyard barbecues. I
don't think so. It's much more serious than that.
Look around here in Wisconsin, right here in Waukesha. [wok ashaw]
Anybody here cheer for the football Spartans
of East
EAST
SHARTONS
Brookfield High School?// I'm told Coach Jack Perry and his team
0
now pay almost $150 bucks for every football helmet -- 10 years
HALF
ago they paid about a third of that. Why the price increase?
DELERE
Because
over
the past 18 years,
18 American companies have
stopped selling football helmets -- because they can't afford the
insurance. (Before this is over, we may go back to the days of
Jim Thorpe -- when people played football without helmets. Is
that progress?)
" IN 1988, RAWLINGS BECAME THE 18th COMPANY IN is YEARS
NOTE:
FACT
SHEET
TO GIVE up THE FREE HELMET 3F. DUE is INCREASING
ATTACHED
CLABILITY EXPERINE -
3
Now, Waukesha and Wisconsin aren't unique -- except in their
physical beauty. This kind of thing is happening every day in
every town across America. And we are all paying the price.
Now understand, this is not a criticism of lawyers. They
are an essential part of our society -- and the majority of legal
professionals work with integrity and honor. But the good
lawyers will tell you, the system is out of control.
CIVIL (DOJ)
(DOJ)
In the past 20 years, the number of A lawsuits XE filed in
(Das)
MORE THAN (DOJ)
OFTEN (00J)
federal courts) has doubled. Today, the average case takes a
year to be resolved -- and in the past year alone -- the number
NEARLY (DOJ)
of cases that were pending for 3 years, increased by 15 percent.
(Think about what that means. You can file a suit, and have
time to enroll in law school, study three years, graduate, pass
the bar, and then represent yourself in court on the day the
decision is reached.)
What does this litigation explosion cost our economy? Well,
the National Association of Manufacturers has just finished
looking at that question. According to a soon to be released
study, Americans spend $200 billion dollars on direct costs to
ALONE (JOHN HOWARD OVP) AND HE SUGGESTS DELETING SENTENCE THAT'S RIGHT BEHI
lawyers.
Keep in mind, that doesn't even count the lawyers on COULD PUT
LANEHAGE RE.
their own payrolls, or the money they end up paying in court
COURT DELAYS AT
LOST OPPORTUNITE
iN ITS PLACE
settlements. (JOHN HEWARD-5VP SAID DELETE THS SEVIENCE)
($200 billion sounds like a lot of money -- and believe me,
it is. American businesses now spend more on insurance, lawyers
EITHER FORMAL c.e. INFORMAL )- To BE DOUBLY SAFE FACTUALLY
and legal fees -- than on training our workers for the new
To PREPARE
economy.) To me that's crazy. As a nation, I believe it's high
BOBBY
CHARLES SUGGESTS: il AMERICAN consumers AND COMPANIES will SPEND up TO $200 BILLION
(INORD)
DOLLARS IN LEGAL SERVICES THIS YEAR.
SEE ATACHER FACT SHEP ACCORDING R "WORRER TRACNING COMPETENG IN
THE NEW INTERNATIONAL ECONOMY (9/90) EMPLOYER INVESTMENT IN TRAING UARIES are
SALO ASAMENT AS. $210 SPENYI INFORMAL AND FORMAL COMBINED
4
time, that we started suing each other less, and caring for each
other more.//
That is why I have sent Congress comprehensive legislation
to reform our Civil Justice System. It is complete with specific
proposals. We want to solve more disputes early -- before they
DISCOVERY (Daj)
get dragged into the courtroom.// We want to speed the legal
JOHN
process -- there is no reason anyone can go through law school
HOWARD
[
faster than it takes a court to reach a verdict. We want to put
SUITS (IIN HONARD) oup
a lid on outrageous punitive damages, that strike terror into
every mom and dad who wants to coach their kid's football team.//
EXPERIMENT WITH (DaJ)
And here's one big idea. I believe we should copy a practice
IN APPROPRIATE CASES (PORTER - "WE ARE TRYING THSEAT IN FEDERAL
from our friends in Britain -- and make the loser pay the
DIVERSITY CASES ONLY. NE
HAVE ALSO ADVANCED IT
WHERE SETTEMENT REFUSEI
winner's court fees. You think that T-shirt company would have AND COURT VERD
(JOHN
brought CRAZY LAWSUNT AGAINST THAT (JOHN HOWARD) OVP
SHO:US OFFER WAS
HOWARD
sued that referee -- if they'd known they'd end up footing his FAIR NOT 'Ei
OVP
ADVICATED FOR
legal bills?//
EVERY CASE.)
This is one part of the crisis in our civil justice system.
But we also need change in our product liability laws. These are
the laws that are supposed to allow people to be compensated for
harm caused to them by a defective product. That's an important
right, and I am all for it. People ought to receive fair
compensation when a product is defective and they get hurt.
But like so much of our civil justice system, product
liability has careened out of control.
Let me give you an example of what I'm talking about: The
Will-Burt Corporation of Orville, Ohio stopped making parts for
ladders, scaffolds, and aircraft --- because the products
5
encountered potential liability costs. But the workers paid an
even higher price -- the company was forced to close plants and
lay off 80 employees.
Here's the problem. The product liability laws vary from
state to state and the rules have encouraged crazy lawsuits, and
outrageous awards. The cost of defending these lawsuits has
escalated. A lot of trial lawyers bring lawsuits, knowing that
it is cheaper for companies to settle the case than to pay their
own lawyers to defend them through trial. And the cost of
insurance keeps skyrocketing.
Big deal, right? So companies have to pay extra for a few
lawyers. But it's not just companies who foot the bill, we all
pay higher prices -- for everything from medicine to step
ladders.
It's worse than that. We've never seen a lot of good
products -- because companies are afraid of liability.
JOITN
In Europe, for example, Volvo offers parents a car seat --
DELETE GRAPH
HOWARD-
built right in the car. You can't buy one in the U.S. today --
JOHN HONARD
OUP
OUP
is WORRIED
and may never be able to. No company wants to deal with our
ABOUT
BOTH ERPIRS
laws.
SUGGESTS
DELETE
And if you're in Europe, and you suffer from AIDS, you can
DELETE GRA
OF
JOHN INSURED
get medical treatment you can't get in the United States.
ovp
CHRISTER
RUNI-VAN
Medical companies are afraid of the liability.
& THEY
But it's all worth it right, because when someone does get
FEELS AND OF OF E
hurt, they can a big settlement? Again, that's not what's
(DOJ CAN'T VERIFY LAWYERS TAKE IN PRODUCTS UABILITY CASES HEARD By JURIES)
happening.
More than half of all the money awarded by juries in
PPC.
IN
6
product liability cases, goes not to the injured party, but to
(DOJ) NEARLY (42%) DOJ
the lawyers.
7
Think about that. More than half of all the awards
-- ends up in the pockets of Brooks Brothers suits.
But here's the real problem. Our product liability system
is killing our economic competitiveness.
Liability costs are 15 times greater than that in Japan,
and 20 times greater than that in Europe. Our businesses --
especially our small businesses -- are staggering under a weight
our competitors don't even carry.
Every dollar we spend around a courtroom, is a dollar we
won't spend on training, education, research, investment. It
will be the difference between no jobs for our kids -- and good
jobs for our kids.
We have to do something about this -- if we want our kids to
have job. Luckily, Senator Bob Kasten understands this. He has
been the fighter to change the system.
Bob has put forth a plan -- which I have endorsed -- to
speed the legal process -- and settle more cases out of court --
which will help everyone.
We want uniformity in product liability law -- instead of
the confusing 51 separate standards we have today. We want to
have the same rules for damages from one state to the next. We
want to bring some rationality to the system.
Our plan is pro-consumer, pro-business, pro-safety, and pro-
jobs. The day my pen signs Senator Kasten's bill -- is the day
our workers get a leg up on other workers.
7
So what's the problem? Why do we still face this crisis?
Bob Kasten will tell you the problem. The Gridlock Congress.
I know you are sick of the blame-game in Washington, but we
can't ignore the facts.
Like my opponent, Mr. Clinton -- many members of Congress
get their campaign funds from trial lawyer organizations. Here's
what one Arkansas trial lawyer wrote about my opponent -- trying
to raise money for the Clinton campaign: "I can never remember
an occasion where he failed to do what was right where we trial
lawyers are concerned." So for my opponent and in many
Congressional offices -- the only thing that gathers more
attention than a TV camera -- is a lawyer in tasselled loafers
with a check in hand.
That's why product liability reform has been blocked, for
almost two decades. In fact, trial lawyers' money has prevented
product liability from ever even coming to a full vote.
But this very week, we have a chance -- to stop undermining
our American workers.
Product liability reform will be up before the U.S. Senate.
We believe we have the votes -- to pass the Senate.
But there's a legal catch -- something called "cloture."
Now cloture sounds like something a doctor would give you after
SENATORS ( (FROM WHENER
you cut your knee. But it's not. It's the number of votes it WRITE INX-ONLY3 IN RED
PERRIT A VOTE (RED WR)
PAGES OF amme
takes to stop long winded debate in the U.S. Congress. (As you P. 7-9)
can imagine, getting Congress to stop talking about anything
8
requires some effort. In fact, it takes more votes to get them
to stop talking -- than to pass a bill.)
While we have a majority of the Senate on our side and your
side, we're not sure we have the extra votes for cloture. So
here's the irony -- Congress and the trial lawyers may be able to
stop the most-needed legal reform in a decade -- by using a legal
loophole.
Bob Kasten doesn't want that to happen -- and neither do I.
I'd like to wrap up a Labor Day present for the American economy,
and for the jobs of the future.
I need you to get on the phone and let Congress know, the
American people are tired of paying for crazy lawsuits. Tired of
high prices. Tired of unsafe products. Most of all, we're tired
of losing jobs to foreign competitors. //
What troubles me so about our litigation crisis, is that it
is so at odds with the true nature of America.
[Revised conclusion]
But what would have happened -- if Columbus had sued the
0
sailmakers of the Santa Maria? What if immigrants in 1903 had
tried to win pain and suffering damages -- because the floor on
BUT WHEN PEOPLE ARE
Ellis Island had hurt their backs?
INJURED By DEFECTIVE
products, THEYSIHILLD BE
We cannot rid our world of risk, nor do we want to. ^ Today,
COMPENSATED
WE NEED A
RATIONAL
I appeal to the common sense of the American people -- to take a PRIDUCT LIABIC
SYSTEM THAT
stand for America's values, and give our workers a chance to
PROTECTS CONSUMER
WITHOUT MARINE
INNOVATION IMPOSIBLE
compete in the world economy.
(RED INK ALMN)
9
Thank you for listening. God bless Wisconsin. God bless
the United States of America.
# # #
LIABILITY TAX RAISES PRICES
MYTH:
Liability costs are a negligible factor in product pricing.
FACT:
Liability costs add greatly to the price of products, and even minor
price increases affect market share, production, and jobs.
Americans now depend on single companies to supply vaccines
for polio, measles, mumps, rubella, and rabies. Lederle
Laboratories, the lone maker of the diphtheria, pertussis, and
tetanus (DPT) vaccine, raised its price per dose from $2.80 to
$11.40 in 1987 to cover the costs of increased lawsuits.
In a recent article in Product Safety and Liability Reporter, Vice
President Quayle pointed out that the Hepatitis B vaccine costs
$160 here and only $12 in Taiwan, because of the cost of U.S.
product liability laws.
Rawlings Sporting Goods announced in 1988 that it would no
May 1992
longer manufacture, distribute, or sell football helmets. Joining
FOR
Spaulding, MacGregor, Medalist, Hutch and others who have
stopped manufacturing helmets, Rawlings was the 18th company
THE
in 18 years to give up the football helmet business due to
increasing liability exposure. Two manufacturers remain.
CIABUTY
According to The Liability Maze, Brookings Institution
PRODUCT PROCEDINATING cimte.
authors estimate that liability costs in 1987 added from
$70,000 to $100,000 per light aircraft that year, and
directly contributed to the decline of the American small
aircraft industry.
Some states allow drunks who fall off ladders to sue a ladder
manufacturer. That is one reason why today 20 percent of the
price of a ladder is attributed to product liability costs.
FROM BETSY ANDERSON (OPD) STUDY IS DATED
SEPT. 1990
lotz 3
128
Worker Training: Competing in the New International Economy
Despite this growing investment, few States have
evaluated their training efforts. One preliminary
HOW MUCH TRAINING IS
study indicates that State assistance has played a
DELIVERED?
positive role in achieving the goal of enhancing the
competitiveness of existing firms.
Accurate estimates of the extent of worker train-
ing do not exist. There are several reasons:
Author
Small employers, who are most in need of training
Few firms respond to surveys; only a handful of
Oberle (1989
assistance, often need better technology and im-
firms keep track of training expenditures and
proved management techniques as well. However,
these firms account for training costs in very
current State technology assistance programs (which
different ways.¹
provide consulting services to firms seeking to
In employee surveys, workers' memories and
Mincer (1989
upgrade their hardware, software, and management
perceptions of training events may be unrelia-
systems) are limited in scope and poorly linked with
ble.²
Bartel (1989)
State training assistance. Neither State technology
Employers more often train their workers
assistance nor State training assistance programs are
informally on the job than in formal class-
adequate to meet growing employer demand. "One-
rooms, making it hard to differentiate between
stop" training and technology assistance for small
"training time" and "work time. ,,, 4
ASTD
employers lost in the jungle of public and private
training providers is available only in Michigan
Not surprisingly, therefore, estimates of the total
Massachusetts, and a few other States.
employer investment in training vary greatly. (See
table 5-1.)
Growing State involvement in worker training
Estimates of U.S. employers' investments in
raises important policy questions. Perhaps most
formal training range from $30 billion to $44
fundamental is: Should government intervene in the
billion.⁵ While these estimates could be off track,
training marketplace, and what criteria should gov-
there is no doubt that employer-provided training is
Carnevale &
ern its assistance given that State resources will
a large enterprise. How large is a matter of interpre-
never be adequate to aid all firms? Closely related is
tation. The $44-billion estimate is less than 1 percent
the question of substitution: Are companies using
of 1988 Gross National Product (GNP) ($4.88
State training funds to support nontraining activi-
trillion). Averaged across an employed workforce of
Craig & Evers
ties? If the money is being used correctly, would the
114 million, investments in formal training are, at
firms have trained their workers anyway in the
most, $385 per worker per year.
absence of State subsidy?
In contrast, the total cost to educate America's 58
NOTE: NE =not
million full-time students (those in primary, second-
*Joseph Oberie
Raising these questions may be less necessary if
ᵇJacob Mincer,
ary, and post-secondary education) in 1987⁶ was
Vocational Educ
companies are required to prove financial need and
about $311 billion⁷-$5,400 per student, or 13 to 20
billion to $330
are limited to subsidies for formal training or
Ann P. Bartel,
times greater than the amount spent on workers.
of Vocational E
systematic on-the-job training (such as trainers'
Because training is only a small component of most
d"Amount Spen
salaries while on the shopfloor) which can be clearly
eMax L. Carey,
identified as training time.
workers' jobs, its costs should not be nearly as great
Anthony P. Car
as those of the full-time education of students.
77-82.
9As cited in Car.
SOURCE: Office
Assessment of Vocational Education, February 1989.
¹Ann P. Bartel, "Utilizing Corporate Survey Data to Study Investments in Employee Training and Development," discussion paper for the National
Nell P. Eurich, Corporate Classrooms (Princeton, NJ: The Carnegie Foundation for the Advancement of Teaching, 1985), p. 7.
However, to
Department of Labor (Alexandria, VA: American Society for Training and Development, March 1989), P. 36.
3Anthony P. Carnevale et al., Best Practices: What Works in Training & Development-Organization and Strategic Role, report prepared for U.S.
est when CO
in their word
Technical Information Service, May 1988), p. 129.
U.S. Congress, Office of Technology Assessment, Technology and the American Economic Transition, OTA-TET-283 (Springfield, VA: National
percent of
The most recent estimate, for 1989, is $44 billion. This total was extrapolated from a survey of companies with 100 or more employees which
firms and ot
Training Magazine, October 1989.
received only a 16 percent response rate. The low response rate makes the accuracy of the extrapolation questionable. The survey was published in
in 1988 ($:)
⁶U.S. Department of Education, National Center for Education Statistics, Digest of Education Statistics 1989 (Washington, DC: U.S. Government
amounts eq
Printing Office, 1989). p. 29.
Tbid., P. 9.
Survey of C
U.S. Chamt
Chapter 5-Delivery of Training by U.S. Firms
129
NOTE
20f3
G IS
Table 5-1-Estimates of Employer Investments in Training
(total annual investment by U.S. employers)
Total
Formal
Informal
vorker train-
(dollars in billions)
Comments
ons:
Author
Oberle (1989)*
NE
44.4
NE
The survey was sent to 20,000 business units with 100 or
a handful of
more employees in early 1989; 3,130 responded for a 16
percent response rate; estimate excludes wages of train-
iditures and
ees. Three-fourths of the total was for wages of trainers.
osts in very
Excludes government training.
Mincer (1989)b
105-210
NES
NES
This study used wages while in training as a proxy for
emories and
training costs. Includes government training.
be unrelia-
Bartel (1989)c
NE
55
NE
The survey was sent to 7,765 business units in early 1987;
493 responded (6 percent response rate). One-third to
one-half of responding units had formal training programs.
eir workers
Some respondents may have included trainees' wages in
ormal class-
their cost estimates. Excludes government training.
late between
ASTD
120-210
30
90-180
The formal training estimate is based on average training
'34
costs multiplied by the number of trainees and courses
from the 1978 Current Population Survey. ASTD excludes
wages of trainees and government training from its formal
of the total
training estimate. The low end informal estimate is based
reatly. (See
on a Bureau of Labor Statistics survey which found that
informal training was cited three times more frequently than
formal training as a source of qualifying training. The high
estments in
end informal estimate is based on Mincer's 1989 estimate
($210 billion) minus ASTD's formal training estimate ($30
ion to $44
billion).
e off track,
Carnevale & Goldstein (1985)'
NE
10-21
NE
The study used 1978 case study survey data from 12 large
d training is
firms, to determine training costs. This was multiplied by
of interpre-
the number of courses from 1978 Current Population
Survey. Includes government training. Higher estimate
an 1 percent
includes wages.
NP) ($4.88
Craig & Evers (1981)9
NE
30-40
NE
Assumes average firm spends half AT&T's 1981 average
vorkforce of
per employee training expenditure of $1,500, and that half
ning are, at
of all U.S. employees receive training. Includes govern-
ment training. Excludes wages of trainees.
NOTE: NE =not estimated; NES -not estimated separately.
merica's 58
ᵇJacob Mincer, "Labor Market Effects of Human Capital and of Its Adjustment to Technological Change," discussion paper for the National Assessment of of
&Joseph Oberle, "Training Magazine's Industry Report 1989," Training Magazine, vol. 26, No. 10, October 1989, p. 32.
ary, second-
Vocational Education, February 1989, pp. 17, 33. A December 1989 analysis by Mincer, using much the same methodology, resulted in a revised total $240
1987⁶ was
or 13 to 20
°Ann P. Bartel, "Utilizing Corporate Survey Data to Study Investments in Employee Training and Development," discussion paper for the National Assessment
billion to $330 billion for formal and informal training combined.
of Vocational Education, February 1989, p. 5.
on workers.
d"Amount Spent on Training by American Businesses-Fact Sheet" (Alexandria, VA: American Society for Training and Development, no date).
ent of most
eMax L. Carey, How Workers Get Their Training, U.S. Department of Labor, Bureau of Labor Statistucs, bulletin no. 2226, March 1985.
'Anthony P. Carnevale and Harold Goldstein, Employee Training: Its Changing Role and An Analysis of New Data (Alexandria, VA: ASTD Press, 1985), PP.
arly as great
77-82.
of students.
9As cited in Carnevale and Goldstein, in footnote f above.
SOURCE: Office of Technology Assessment, 1990.
for the National
However, training expenditures are also quite mod-
formal training while others spend nothing. Overall,
est when compared with other employer investments
employers spent more (2.8 percent of payroll) on
repared for U.S.
in their workers. Forty-four billion dollars equals 1.8
coffee breaks, lunch, and other paid rest time for
id, VA: National
percent of the total compensation that American
their employees than on formal training.⁹
firms and other private employers paid their workers
When the costs of informal training are included,
nployees which
in 1988 ($2.4 trillion⁸). A few companies spend
cost estimates range from $105 billion to $210
vas published in
amounts equal to 4 or 5 percent of their payroll on
billion or more per year (see table 5-1). However, the
S. Government
Survey of Current Business, vol. 69, No. 7, July 1989, table 1.14, p. 45.
U.S. Chamber of Commerce, "Employee Benefits," Survey Data From Benefit Year 1988 (Washington, DC: 1989), P. 27.
3of3
130
Worker Training: Competing in the New International Economy
$210 billion estimate is not comparable with the
full-time training manager who designs and delivers
some insta
other estimates in table 5-1, because, unlike the
both an apprenticeship program and ongoing off-
ment than
others, it assumes that workers share in the costs of
hours courses for the company's 300 employees. 13
training by accepting a lower wage than would
The company defrays part of these costs by allowing
A study
otherwise be paid during the training period.
nonemployees to enroll in its classes for a fee.
those whos
Most informal training is unstructured, consisting
paying for
of experienced co-workers and supervisors showing
Economic Barriers to Workplace Training¹⁴
during trai
newer employees how to do their jobs. Such training
own educa
According to human capital theory, worker train-
does not compare favorably with the highly struc-
rates were
tured informal training and the growing amount of
ing extends across a spectrum ranging from "gen-
whose firn
eral" training, which "is useful in many firms
formal training provided by firms in competitor
those who
nations (see ch. 3).
besides those providing it, to "specific" train-
selves, eith
ing, which is useful only in the firm where it is
tuition for
provided. Because firms could lose part of their
Training in Small Firms
Another stu
return from general training investments if a newly
employers,
Training is delivered unevenly across firms and
trained worker took a job with another firm, the
indeed pay
among workers. While a few large corporations
theory states that, although firms might provide such
training. 20
spend major sums on employee training, many small
training, they do not pay for it. Instead, employers
rates follow
companies spend little or nothing. 10 Larger firms are
pay a lower wage during the training period to cover
creased pro
more likely to provide structured training because
the training costs. Employees accept the lower wage
Despite the
they have lower labor turnover and greater access to
because they recognize that they will benefit from
to quit or be
capital to finance training. 11 It is also possible that
the general training. Another theorem of human
new skills
the training tends to further reduce their labor
capital theory is that firms and workers share the
market-th
turnover.
costs of specific training (the workers' share is paid
skills and h
in the form of a wage lower than their productivity
Although smaller firms invest little in formal
would otherwise justify) since both parties benefit. 16
training, they nonetheless do train their employees
An earlie
To guard against turnover, the theory says, firms pay
informally. Typically, workers at firms with less
that when V
higher wages following specific training than would
than 100 employees have greater training needs
specific trai
be warranted based strictly on productivity.
because, in comparison to workers at large firms,
were less lik
they tend to be less well-educated and have a less
Some subsequent empirical studies have called
share of spec
stable employment history. These needs are usually
both of these basic premises into question, suggest-
off the work
met by supervisors or co-workers informally teach-
ing that firms sometimes pay for general training and
ing new hires. 12
that firms and workers do not always share the costs
In actual 1
of specific training. More importantly, however,
is purely ger,
Strong management commitment at some smaller
these studies found that, when firms do take the risk
types of tra
firms drives investment in formal as well as informal
of investing in both general and specific training,
empirical st
training. A few even develop their own in-house
they are less likely to lose their investment through
specific trair
training. For example, General Tool, a family-
quits or layoffs than the original human capital
are reduced,
owned machine tool job shop in Cincinnati, has a
theory would suggest. This suggests that, at least in
¹⁷Tbid., p. 37.
10Jerome M. Rosow and Robert Zager, Training: The Competitive Edge (San Francisco, CA: Jossey-Bass, 1988), p. 1.; Eurich, op. cit., footnote 2,
18Michael Feu
p. 9; Sheldon Haber et al., "Employment and Training Opportunities in Small and Large Firms" (Potomac, MD: Simon & Co., under U.S. Small
1987, PP. 121-136
Business Administration Contract No. SBA-8587-AER-84, 1988), P. viii.
19Tbid.
"John H. Bishop, "On-the-Job Training of New Hires," working paper #89-11, Center for Advanced Human Resources Studies, Cornell University,
20Bishop. op.
presented at the symposium on market failure in training, LaFollette Institute of Public Affairs, University of Wisconsin, Madison, May 1989, p. 33.
21Tbid.
12. Employment and Training Opportunities in Small and Large Firms," op. cit., footnote 10, p. 90.
22Donald Pars
13James Stewart, Director, Manufacturing and Engineering, General Tool Co., personal communication, May 4, 1989.
November/Decem
¹⁴This discussion is based on a working paper by Michael J. Feuer, OTA, "Economic Analysis of Workplace Training: Human Capital Theory and
23Michael Feut
Beyond," August 1989.
invited paper, sym
15Gary Becker, Human Capital: A Theoretical and Empirical Analysis With Special Reference to Education, 2d ed. (New York, NY: National Bureau
24Masanori Ha
of Economic Research and Columbia University Press, 1975), P. 19.
16 "Economic Analysis of Workplace Training," op. cit., footnote 14, P. 30.
"Eurich, op. ci
26peter A. Creti
Commission for E1
27Tbid., p. 58.
2 September 1992 /// 11:10 a.m.
MEMORANDUM FOR STEVE PROVOST
FROM:
JEANNIE BUNTON
SUBJECT:
Legal Reform Speech
POSSIBLE FUNNY: Judge Wapner -- The People's Court reference
For What it's worth from Ed --- whose Dad is a Reagan Democrat
Lawyer about to not vote for POTUS because of the generic trial
lawyer bashing --- need to "separate the sin from the sinner" --
there are some great lawyers out there doing great work -- it's
the bad ones who take advantage of the sytem that we're talking
about ...
N
WAUKESHA COUNTY EXPOSITION GROUNDS
Waukesha [just west of Milwaukee]
[WOK-a-shaw] not Wa-keesha
advance
CONTACTS:
BQ Wisconsin -- Nate Elias (608) 256-2874
Mark Block (414) 821-1992
team goes m
Gov. Thompson -- (608) 266-1212
tonight 02/09/92
Bill McCoshen
per Shark Block
Research/local: per Mark Block and his researcher Bryan
1.
Where does local high school team buy helmets? Cost today
V. 10 yrs. ago?
Brookfield High School [east or central?] 10 mins. from
Expo Center -- well known in community
Coach
Mascot
today pays between $105 and $135 per helmet V. $50 -$60
decade years ago
Waukesha South High School
Coach
Mascot -- "Blackshirts"
according to athletic director -- paid $90 for helmets --
double what they paid a decade ago.
2.
Little League Liability insurance -- Cost today V. 10 yrs.
ago?
unable to get littl league info -- county doens't break
liability down by team -- lagues are pooled -- if two kids
run into ine another on the field -- not liable, on the
other hand if a kid slides into second base and gets hurt
because it didn't break away -- then the county is liable.
3.
Hepatitus B vaccine -- cost today V. 10 yrs. ago?
at Waukesha Memorial Hospital a Hep B shot costs $55.46
today -- in 1989 [when it was developed] it cost $52.25
Still working on --
ANYTHING AT EXPO THAT CAN'T BE DONE THIS YEAR DUE TO LIABILITY
INS. OR COSTING MORE TO DO
any area bis. hampered by liability insurance costs ---
professional or otherwise ie physician
List of industries in Waukesha County
...
John Howard - OVP/counsel 2816:
helping verify 2/3 obstetricians in America have been sued --
thinks it may be higher -- is checking; also looking into an
obsto from Waukesha who may have been sued -- advised we may want
to avoid local prejudice -- it might backfire on us -- instead
use another example from nearby -- get the same bang for the
buck
asked if we were working with AMA -- I said no; should we? he
said he'd check. probably would have to work through state and
local associations.
Lincoln anecdote in "Little Brown Book of Anecdotes", p. 356.
"In his legal practice Lincoln was never greedy for fees and
discouraged unnecessary litigation. A man came to him in a
passion, asking him to bring a suit for $2.50 against an
impoverished debtor. Lincoln tried to dissuade him, but the man
was determined upon revenge. When he saw that the creditor was
not to be put off, Lincoln asked for and got $10 as his legal
fee. He gave half of this to the defendant, who thereupon
willingly confessd to the debt and paid up the $2.50, thus
settling the matter to the entire satisfaction of the irate
plaintiff."
9/6/92
6:30 pm
UPDATED AND AMENDED INFORMATION
Josh:
Attached are amended documents that have been updated since the
12:00 memo. The only document that has been changed is 2.
Rebuttal to Minority Report. These amendments are minor, they
reflect current POTUS speech language regarding the costs of
litigation (how much goes to the lawyers) and the liability
costs.
1) Product Liability Fact Sheet (OVP)
2) Rebuttal to Minority Report (OVP)
3) Summary of S. 640 (Senate)
4) Product Liability Talking Points (Senate)
5) Response to Likely Questions (Senate)
6) What S. 640 Does (PLCC)
As before, none of these have been sent through the White House
clearance channels.
Mark Paoletta from WHCounsel's Office is now shepherding the
speech. He is soliciting comments from Stu Gerson, AAG for the
Civil Division.
Tiger Joyce of the Commerce Committee is still standing by to
provide any technical support we may need. His numbers are (703)
548-8155 and 224-2498. I have been unable to reach Victor
Schwartz but have his home number -- 703-212-0524.
Please let me know if you would like any additional information.
CC: John Schmitz
Product Liability Fairness Act
FACT SHEET
Product liability litigation needs reform that can only be
accomplished through clear and coherent national legislation.
The current system of 51 separate product liability laws is
plagued, by uncertainties that hurt both consumers and
manufacturers. Meritless suits clog the system, preventing swift
and just compensation to those with meritorious claims. Long
delays, high costs and the uncertainty of random punitive damage
system fail to serve justice. Ultimately, these costs are borne
by the American consumers.
The question is how to compensate those who have been
injured by defective products without undermining American
competitiveness. The Product Liability Fairness Act meets this
challenge by establishing uniform federal rules to be applied by
the state courts in all product liability litigation.
Alternative Dispute Resolution: The Act provides for
alternative to trial and expedited offers of settlement. If
the result in litigation is less favorable than the rejected
offer, the rejecting party may have to pay the other side's
legal fees. The Act also mandates fee-shifting if a party
unreasonably refuses to engage in settlement discussions.
Provides Rational Rules for Punitive Damages: Punitive
damages may be awarded if one proves by clear and convincing
evidence that the defendant's conduct manifested "conscious,
flagrant indifference" to public safety. The Act encourages
proper conduct by drug and aircraft manufacturers by
protecting them from punitive damages if they supply all
material safety information to the FDA and FAA and the
respective agencies have certified their products.
Product Seller Liability: Product sellers will be liable
for harm caused by their own negligence. If the
manufacturer is "judgment proof" or cannot be served with
process, the product seller will then have the same
liability as the manufacturer.
Several Liability for Non-Economic Damages: A defendant
will be liable for non-economic damages only to the extent
of his own share of responsibility.
Alcohol and Drug Usage: If a claimant's alcohol or drug
usage is more than 50% responsible for his harm, he cannot
recover.
Worker Compensation Offset; Lien Limitations: Encourages
workplace safety by eliminating the lien when the employer's
negligence causes the accident.
AMENDED
Minority Views of Senators Hollings and Gore
Summary with Suggested Rebuttals
1. The Current System is Fair/There is No "Litigation Explosion"
- number of tort cases declining
- reform efforts are based on anecdote alone
Response:
+ these facts are disputed by a number of studies
+ total tort costs increase 12% each years
+ nearly 1/2 of the money goes to pay both sides' lawyers
2. The Current System Promotes Product Safety
- companies are becoming more careful in product design
- punitive damages deter unsafe products
Response:
+ fear of litigation chills innovation (AIDS, DPT etc)
+ threat of punitive damages limits all production, whether
the product is safe or unsafe
3. The Current System Promotes Federalism
- S. 640 encroaches on state's prerogatives
- issue isn't important enough for Federal action
Response:
+ States have been unable to address issue
+ Reform is critical
+ National Governors' Association unanimously backs S. 640
4. The Current System Did Not Cause the Insurance Crisis
- Insurance "crisis" doesn't exist -- coverage is available
Response:
+ Municipalities/charities have limited services due to $
+ Many companies are "going bare" lacking any coverage
5. Product Liability is Not a Major Factor in Competitiveness
- only 1% is spent on insurance
- OTA study didn't identify PL as a factor
Response:
+ legal expenses have increased more than R&D
+ U.S. companies pay much, much more than foreign
companies for PL insurance
+ real cost is the time it takes to resolve disputes
(over 2 1/2 years)
6. S. 640 will not reduce Product Liability Costs
- S. 640 will not reduce transaction costs
- S. 640 will not reduce insurance premiums
Response:
+ uniform rules will promote certainty
+ settlement provisions encourage earlier resolution
7. Product Liability System Does Not Stifle Innovation
- system works to keep only "unsafe" product off market
Response:
+ these are the same arguments used for the Corvair
+ In a 1988 survey of manufacturers, the Conference Board
found that because of liability concerns:
more than 1/3 of firms decided against introducing
new products
25% had discontinued some form of product research
47% had withdrawn products from the market
15% had laid off workers
8% had closed plants
General Responses
+
Trial Lawyers benefit more from the current system than
injured parties. That is why the trial lawyers are fighting
so hard to defeat this bill.
+
Nearly 1/2 the money in a product liability suit goes to
both sides' lawyers. It takes, on average, 2 1/2 years to
resolve these suits.
+
Product Liability laws are not balanced - largely because of
trial lawyers' lobby. Ask the opposing Senators "which
would you rather have for your state -- more lawyers or more
jobs. "
SUMMARY - S. 640, THE PRODUCT LIABILITY FAIRNESS ACT
I.
Whoever Creates Harm Should Take Responsibility For It.
Joint and Several Liability. The bill abolishes joint and
several liability with respect to noneconomic damages,
such as pain and suffering. It is outrageous that an
individual may be required to pay 100 percent of damages
when he is only 1 percent responsible.
Product Sellers. Product sellers will be liable only for
their own negligence, failure to comply with an express
warranty, or if the manufacturer cannot be brought into
court or is unable to pay a judgment.
Alcohol and Drugs. The defendant has an absolute defense
if the plaintiff's drunk or drugged condition was more
than 50 percent responsible for his injuries.
II. The Bill Reduces Legal Costs.
Expedited Settlements. Either party may make a settlement
offer. If the offeree refuses the offer and would have
done better under the proposed settlement than he did in
litigation, the offeree will pay the other party's legal
fees and costs. This expands Rule 68 of the Federal Rules
of Civil Procedure to cover both costs and attorneys'
fees
Alternative Dispute Resolution (ADR). Either party may
offer to participate in an approved ADR procedure. If a
party refuses to participate and later has a verdict
entered against it, that party will pay the opponent's
legal fees and costs.
Punitive Damages. In order to recover punitive damages, a
plaintiff must prove conscious, flagrant indifference to
the safety of those who might be harmed by clear and
convincing evidence. Trials may be bifurcated so that the
punitive damages phase of the trial is separate from the
proceedings on compensatory damages. Food and Drug
Administration or Federal Aviation Administration
pre-market approval or certification is a defense against
punitive damages except in cases of bribery or the
submission of false data in the regulatory process.
Workers' Compensation Offset. An employer's right to
recover workers' compensation benefits from a manufacturer
who made a product that allegedly harmed a worker is
preserved unless a manufacturer can prove that the
employer caused the injury. This will reduce litigation
and create incentives to make the workplace safer.
III. The Bill Protects The Right Of Injured Persons To
Receive Compensation.
Statute of Limitations. Would run two years after an
injured person discovers the injury and its cause. Some
statutes begin to run when a person is injured, even if
injury's cause is discovered years later.
Product Liability Talking Points
I. The Present Tort System and, in Particular, the Product
Liability System is an Outrage.
The System is Slow and Unfair to Victims. It fails to
provide injured persons fair compensation in a timely
fashion. According to a 1989 GAO study, cases take an
average of nearly three years to resolve. According to
former Commerce Secretary Mosbacher, as much as 75 percent
of the system's costs go to pay attorneys' fees or other
transaction costs, rather than to injured persons.
Compensation for Severely Injured Victims is Inadequate.
According to a study by the Insurance Services Office, the
victim of a product-related injury can expect to receive a
windfall of nearly nine times his losses if his injuries
are minor. If his injuries are severe, however, he should
expect to receive only 15 percent of his losses.
II. The Current Tort System is Great for Lawyers but it Hurts
the National Economy.
The Product Liability System Hurts American
Competitiveness. According to a 1988 Conference Board
Report, 47 percent of the companies surveyed indicated
that they had discontinued product lines, and 16 percent
have laid off workers, and 21 percent have discontinued
research and development because of liability concerns.
For example, the general aviation industry has seen the
number of aircraft sold drop from 17,000 in 1979 to 1,023
in 1991, partly as a result of liability concerns. The
National Machine Tool Builders Association testified that
it has lost nearly 25 percent of its market share to
foreign competitors in recent years due mainly to
excessive product liability costs.
Product Liability Costs are Much Lower Overseas. A 1984
Department of Commerce study found that product liability
costs for U.S. manufacturers are 20 to 50 times higher
than those of their foreign competitors. U.S. product
liability judgments are SO excessive that England and
France have refused to enter into reciprocal enforcement
treaties for legal judgments.
The Current System Benefits Only Lawyers. Less than half
the costs of litigation goes to injured persons. U.S.
tort costs between 1950 and 1988 have grown 4.5 times
faster than the GNP. Further, the number of lawyers in
the U.S. has more than doubled between 1970 and 1990. On
a per capita basis, the U.S. has three times as many
lawyers as Germany and 30 times as many lawyers as Japan.
According to a Clemson University study, each lawyer costs
the U.S. $2.6 million in foregone GNP.
Responses to Likely Arquments
1. This bill denies compensation to women injured by silicone breast implants.
Response: Breast implants have not been certified by the FDA. Therefore,
this product is not covered by the defense against punitive damages. Women
injured by breast implants may recover full compensatory damages and
punitive damages under this bill.
2. The provision on alternative dispute resolution (ADR) will deny injured
persons their right to a jury trial.
Response: If a party enters into voluntary ADR at the request of the other
party, there will be no penalty for declining to accept the results of the
ADR procedure and going to trial. Governor Clinton has indicated his
support for promoting the use of ADR. That is what this provision
accomplishes.
3. The provision on settlement offers could leave a poor individual paying the
legal fees of a Fortune 500 Company because a verdict is $1 less than a
settlement offer.
Response: If a Fortune 500 company offers a settlement that is $1 less
than a jury verdict, then the provision has achieved its objective of
promoting fair and prompt settlements. The bill provides that in such
situations, however, the penalty for a plaintiff cannot exceed the amount
of collateral benefits the plaintiff may receive for the injury. For a
poor plaintiff with no collateral benefits, there would be no penalty.
Plaintiffs' rights should not be reduced based on decisions of an agency
such as the FDA.
Response: The "FDA defense" applies only to punitive damages. Punitive
damages are tantamount to a criminal penalty. They are not compensatory.
A company that spends millions of dollars over several years to comply
fully with regulatory requirements has not engaged in willful or
intentional misconduct that merits punitive damages. This defense to
punitive damages is not available if the company has withheld or
misrepresented information in the regulatory process -- either before FDA
approval or after.
The provision on joint and several liability denies compensation to
severely injured persons.
Response: This provision is based on a 1986 referendum approved by voters
in California. The provision does not affect state law regarding economic
damages such as medical expenses or lost wages. It is outrageous that an
individual may be required to pay 100 percent of a pain and suffering award
even if he is only 1 percent responsible.
What S. 640
What S. 640 Does
Does Not Do
Time Limitations: The bill helps consumers by preserving their right to sue until a person discovers, or should
S. 640 bears little resemblance to the
have discovered, the harm or its cause. This improves upon present law in that some states cut off lawsuits even
pro-defendant product liability bills
before an injury has manifested itself. Similarly, the bill also puts an outer time limit on litigation involving
that business groups were supporting
workplace capital goods products over 25 years old. Thus, unlike the European Economic Community which has a
a short number of years ago. In fact,
10 year limit on all products, S. 640 would only not allow a lawsuit on capital products over 25 years old, and
this bill focuses on protection of
even then the bar would apply only if the claimant is eligible to receive workers compensation for the harm.
plaintiff's rights. Unlike the past,
this bill:
Expedited Settlements: On average, injured people must wait 2-1/2 years for compensation (4 years if the case is
appealed.) S. 640 provides incentives to settle suits, compensate injured people more quickly and reduce legal
1. Does not contain any caps on
costs.
damage awards.
Alternative Dispute Resolution: To reduce legal costs, speed settlements and take lawsuits out of back-logged
2. Does not limit the amount of
courts, either party may request voluntary alternative dispute resolutions (such as arbitration.)
punitive damage awards and does not
take away the jury's right to decide
Product Seller Liability Standards: Product sellers will be liable to consumers for harm caused by their
punitive damage awards.
negligence. This negligence can result by alteration of a product, assembling a product or making false
representations about the product. Sellers will also be liable if they've dealt with a foreign manufacturer that
3. Does not create a defense against
has no assets in the U.S. or with a manufacturer that has gone out of business.
liability for products that comply
with Government standards.
Punitive Damages: The bill creates a uniform standard for punitive damages. A claimant must prove "by clear
and convincing evidence" that the defendant's conduct manifested a "conscious, flagrant indifference" to the
4. Does not preclude courts from
public safety. The bill also makes it possible to consider punitive damages apart from the issues of liability and
allowing evidence about product
compensatory damages.
improvements to be admitted in
S. 640 establishes a defense against punitive damages for drugs and medical devices that have pre-market FDA
cases.
approval and aircraft with pre-market certification from the FAA. These defenses would not apply if the
defendant committed fraud, withheld information or bribed FDA or FAA officials in obtaining the approval or
5. Does not create a "state-of-the-
certification.
art" defense for manufacturers.
It should be noted that only Great Britain, which does not use a jury system, and the United States allow
punitive damages. The rest of the world, including Japan, does not provide for punitive damages at all.
6. Does not create a defense for
manufacturers of products that are
Several Liability for Non-Economic Damages: Consumers, insurers and businesses have long been victimized by
"inherently dangerous" or
the joint and several liability rule (i.e. the "deep pocket rule") which makes it possible to force any defendant to
"unavoidably unsafe".
pay the entire damages even if that defendant is only minimally at fault and other persons who were at fault were
not sued or could not pay. S. 640 adopts the California law--each defendant will be liable for non-economic
7. Does not contain a broad statute of
damages (pain and suffering, emotional distress) only in proportion to the defendant's share of the responsibil-
repose for consumer products, unlike
ity for the harm. S. 640 does not affect joint liability for economic damages such as medical costs and lost wages.
the European Economic Community
which has a 10 year statute of repose
Alcohol and Drug Defenses: S. 640 adopts Washington State law in disallowing suits when a claimant's use of
for all products. S. 640 has a statute
alcohol or illicit drugs was determined by a jury to be the primary cause (more than 50%) of the injury. This
of repose of 25 years only for capital
means consumers will not have to pay exorbitant prices for products to cover drug or alcohol induced damages.
goods. Even then, the statute only
operates to bar a claim if the
Workplace Safety: Currently, employers can recover any workers' compensation they have paid to an injured
claimant is eligible to receive
employee by filing a subrogation lien on the employee's suit with a manufacturer. As an incentive to employers
workers compensation benefits for
the harm.
to provide a safe workplace, the bill would disallow the lien if the employer was at fault for the injury (e.g. by
removing a safety guard or not providing adequate training.)
9/6/92
12:00 pm
Josh:
Attached are some documents that may aid in the product liability
briefing.
1) Product Liability Fact Sheet (OVP)
2) Rebuttal to Minority Report (OVP)
3) Summary of S. 640 (Senate)
4) Product Liability Talking Points (Senate)
5) Response to Likely Questions (Senate)
6) What S. 640 Does (PLCC)
Tiger Joyce of the Commerce Committee is standing by to provide
any technical support we may need. His numbers are (703) 548-
8155 and 224-2498. I have been unable to reach Victor Schwartz
but have his home number ---- 703-212-0524.
Please let me know if you would like any additional information.
gl Howard
DRAFF- NOT SIGNED-OFF ON YET
Product Liability Fairness Act
FACT SHEET
Product liability litigation needs reform that can only be
accomplished through clear and coherent national legislation.
The current system of 51 separate product liability laws is
plagued by uncertainties that hurt both consumers and
manufacturers. Meritless suits clog the system, preventing swift
and just compensation to those with meritorious claims. Long
delays, high costs and the uncertainty of random punitive damage
system fail to serve justice. Ultimately, these costs are borne
by the American consumers.
The question is how to compensate those who have been
injured by defective products without undermining American
competitiveness. The Product Liability Fairness Act meets this
challenge by establishing uniform federal rules to be applied by
the state courts in all product liability litigation.
Alternative Dispute Resolution: The Act provides for
alternative to trial and expedited offers of settlement. If
the result in litigation is less favorable than the rejected
offer, the rejecting party may have to pay the other side's
legal fees. The Act also mandates fee-shifting if a party
unreasonably refuses to engage in settlement discussions.
Provides Rational Rules for Punitive Damages: Punitive
damages may be awarded if one proves by clear and convincing
evidence that the defendant's conduct manifested "conscious,
flagrant indifference" to public safety. The Act encourages
proper conduct by drug and aircraft manufacturers by
protecting them from punitive damages if they supply all
material safety information to the FDA and FAA and the
respective agencies have certified their products.
Product Seller Liability: Product sellers will be liable
for harm caused by their own negligence. If the
manufacturer is "judgment proof" or cannot be served with
process, the product seller will then have the same
liability as the manufacturer.
Several Liability for Non-Economic Damages: A defendant
will be liable for non-economic damages only to the extent
of his own share of responsibility.
Alcohol and Drug Usage: If a claimant's alcohol or drug
usage is more than 50% responsible for his harm, he cannot
recover.
Worker Compensation Offset; Lien Limitations: Encourages
workplace safety by eliminating the lien when the employer's
negligence causes the accident.
Minority Views of Senators Hollings and Gore
Summary with Suggested Rebuttals
1. The Current System is Fair/There is No "Litigation Explosion"
- number of tort cases declining
- reform efforts are based on anecdote are scarce
Response:
+ these facts are disputed by a number of studies
+ total tort costs increase 12% each years
+ more than 50% of the money goes to lawyers
Nearly 1/2
2. The Current System Promotes Product Safety
- companies are becoming more careful in product design
- punitive damages deter unsafe products
Response:
+ fear of litigation chills innovation (AIDS, DPT etc)
+ threat of punitive damages limits all production, whether
the product is safe or unsafe
3. The Current System Promotes Federalism
- S. 640 encroaches on state's prerogatives
- issue isn't important enough for Federal action
Response:
+ States have been unable to address issue
+ Reform is critical
+ National Governors' Association unanimously backs S. 640
4. The Current System Did Not Cause the Insurance Crisis
- Insurance "crisis" doesn't exist -- coverage is available
Response:
+ Municipalities/charities have limited services due to $
+ Many companies are "going bare" lacking any coverage
5. Product Liability is Not a Major Factor in Competitiveness
- only 1% is spent on insurance
- OTA study didn't identify PL as a factor
Response:
+ legal expenses have increased more than R&D
+ U.S. 12-15 times more than foreign
companies companies for PL pay insurance (President not are
+ real cost is the time it takes to resolve disputes
(over 2 1/2 years)
speed)
6. S. 640 will not reduce Product Liability Costs
- S. 640 will not reduce transaction costs
- S. 640 will not reduce insurance premiums
Response:
+ uniform rules will promote certainty
+ settlement provisions encourage earlier resolution
7. Product Liability System Does Not Stifle Innovation
- system works to keep only "unsafe" product off market
Response:
+ these are the same arguments used for the Corvair
+ In a 1988 survey of manufacturers, the Conference Board
found that because of liability concerns:
more than 1/3 of firms decided against introducing
new products
25% had discontinued some form of product research
47% had withdrawn products from the market
15% had laid off workers
8% had closed plants
General Responses
+
Trial Lawyers benefit more from the current system than
injured parties. That is why the trial lawyers are fighting
so hard to defeat this bill.
Nearl
+
Far more than 1/2 the money in a product liability suit goes
to lawyers. It takes, on average, 2 1/2 years to resolve
these suits.
+
Product Liability laws are not balanced - largely because of
trial lawyers' lobby. Ask the opposing Senators "which
would you rather have for your state -- more lawyers or more
jobs. "
SUMMARY - S. 640, THE PRODUCT LIABILITY FAIRNESS ACT
I. Whoever Creates Harm Should Take Responsibility For It.
O
Joint and Several Liability. The bill abolishes joint and
several liability with respect to noneconomic damages,
such as pain and suffering. It is outrageous that an
individual may be required to pay 100 percent of damages
when he is only 1 percent responsible.
)
Product Sellers. Product sellers will be liable only for
their own negligence, failure to comply with an express
warranty, or if the manufacturer cannot be brought into
court or is unable to pay a judgment.
Alcohol and Drugs. The defendant has an absolute defense
if the plaintiff's drunk or drugged condition was more
than 50 percent responsible for his injuries.
II. The Bill Reduces Legal Costs.
Expedited Settlements. Either party may make a settlement
offer. If the offeree refuses the offer and would have
done better under the proposed settlement than he did in
litigation, the offeree will pay the other party's legal
fees and costs. This expands Rule 68 of the Federal Rules
of Civil Procedure to cover both costs and attorneys'
fees.
Alternative Dispute Resolution (ADR). Either party may
offer to participate in an approved ADR procedure. If a
party refuses to participate and later has a verdict
entered against it, that party will pay the opponent's
legal fees and costs.
Punitive Damages. In order to recover punitive damages, a
plaintiff must prove conscious, flagrant indifference to
the safety of those who might be harmed by clear and
convincing evidence. Trials may be bifurcated so that the
punitive damages phase of the trial is separate from the
proceedings on compensatory damages. Food and Drug
Administration or Federal Aviation Administration
pre-market approval or certification is a defense against
punitive damages except in cases of bribery or the
submission of false data in the regulatory process.
Workers' Compensation Offset. An employer's right to
recover workers' compensation benefits from a manufacturer
who made a product that allegedly harmed a worker is
preserved unless a manufacturer can prove that the
employer caused the injury. This will reduce litigation
and create incentives to make the workplace safer.
III. The Bill Protects The Right Of Injured Persons To
Receive Compensation.
Statute of Limitations. Would run two years after an
injured person discovers the injury and its cause. Some
statutes begin to run when a person is injured, even if
injury's cause is discovered years later.
Product Liability Talking Points
I. The Present Tort System and, in Particular, the Product
Liability System is an Outrage.
The System is Slow and Unfair to Victims. It fails to
provide injured persons fair compensation in a timely
fashion. According to a 1989 GAO study, cases take an
average of nearly three years to resolve. According to
former Commerce Secretary Mosbacher, as much as 75 percent
of the system's costs go to pay attorneys' fees or other
transaction costs, rather than to injured persons.
Compensation for Severely Injured Victims is Inadequate.
According to a study by the Insurance Services Office, the
victim of a product-related injury can expect to receive a
windfall of nearly nine times his losses if his injuries
are minor. If his injuries are severe, however, he should
expect to receive only 15 percent of his losses.
II. The Current Tort System is Great for Lawyers but it Hurts
the National Economy.
The Product Liability System Hurts American
Competitiveness. According to a 1988 Conference Board
Report, 47 percent of the companies surveyed indicated
that they had discontinued product lines, and 16 percent
have laid off workers, and 21 percent have discontinued
research and development because of liability concerns.
For example, the general aviation industry has seen the
number of aircraft sold drop from 17,000 in 1979 to 1,023
in 1991, partly as a result of liability concerns. The
National Machine Tool Builders Association testified that
it has lost nearly 25 percent of its market share to
foreign competitors in recent years due mainly to
excessive product liability costs.
Product Liability Costs are Much Lower Overseas. A 1984
Department of Commerce study found that product liability
costs for U.S. manufacturers are 20 to 50 times higher
than those of their foreign competitors. U.S. product
liability judgments are so excessive that England and
France have refused to enter into reciprocal enforcement
treaties for legal judgments.
The Current System Benefits Only Lawyers. Less than half
the costs of litigation goes to injured persons. U.S.
tort costs between 1950 and 1988 have grown 4.5 times
faster than the GNP. Further, the number of lawyers in
the U.S. has more than doubled between 1970 and 1990. On
a per capita basis, the U.S. has three times as many
lawyers as Germany and 30 times as many lawyers as Japan.
According to a Clemson University study, each lawyer costs
the U.S. $2.6 million in foregone GNP.
Responses to Likely Arguments
1. This bill denies compensation to women injured by silicone breast implants.
Response: Breast implants have not been certified by the FDA. Therefore,
this product is not covered by the defense against punitive damages. Women
injured by breast implants may recover full compensatory damages and
punitive damages under this bill.
2. The provision on alternative dispute resolution (ADR) will deny injured
persons their right to a jury trial.
Response: If a party enters into voluntary ADR at the request of the other
party, there will be no penalty for declining to accept the results of the
ADR procedure and going to trial. Governor Clinton has indicated his
support for promoting the use of ADR. That is what this provision
accomplishes.
3. The provision on settlement offers could leave a poor individual paying the
legal fees of a Fortune 500 Company because a verdict is $1 less than a
settlement offer.
Response: If a Fortune 500 company offers a settlement that is $1 less
than a jury verdict, then the provision has achieved its objective of
promoting fair and prompt settlements. The bill provides that in such
situations, however, the penalty for a plaintiff cannot exceed the amount
of collateral benefits the plaintiff may receive for the injury. For a
poor plaintiff with no collateral benefits, there would be no penalty.
4. Plaintiffs' rights should not be reduced based on decisions of an agency
such as the FDA.
Response: The "FDA defense" applies only to punitive damages. Punitive
damages are tantamount to a criminal penalty. They are not compensatory.
A company that spends millions of dollars over several years to comply
fully with regulatory requirements has not engaged in willful or
intentional misconduct that merits punitive damages. This defense to
punitive damages is not available if the company has withheld or
misrepresented information in the regulatory process -- either before FDA
approval or after.
5. The provision on joint and several liability denies compensation to
severely injured persons.
Response: This provision is based on a 1986 referendum approved by voters
in California. The provision does not affect state law regarding economic
damages such as medical expenses or lost wages. It is outrageous that an
individual may be required to pay 100 percent of a pain and suffering award
even if he is only 1 percent responsible.
What S. 640
What S. 640 Does
Does Not Do
Time Limitations: The bill helps consumers by preserving their right to sue until a person discovers, or should
S. 640 bears little resemblance to the
have discovered, the harm or its cause. This improves upon present law in that some states cut off lawsuits even
pro-defendant product liability bills
before an injury has manifested itself. Similarly, the bill also puts an outer time limit on litigation involving
that business groups were supporting
workplace capital goods products over 25 years old. Thus, unlike the European Economic Community which has a
a short number of years ago. In fact,
10 year limit on all products, S. 640 would only not allow a lawsuit on capital products over 25 years old, and
this bill focuses on protection of
even then the bar would apply only if the claimant is eligible to receive workers compensation for the harm.
plaintiff's rights. Unlike the past,
this bill:
Expedited Settlements: On average, injured people must wait 2-1/2 years for compensation (4 years if the case is
appealed.) S. 640 provides incentives to settle suits, compensate injured people more quickly and reduce legal
1. Does not contain any caps on
costs.
damage awards.
Alternative Dispute Resolution: To reduce legal costs, speed settlements and take lawsuits out of back-logged
2. Does not limit the amount of
courts, either party may request voluntary alternative dispute resolutions (such as arbitration.)
punitive damage awards and does not
take away the jury's right to decide
Product Seller Liability Standards: Product sellers will be liable to consumers for harm caused by their
punitive damage awards.
negligence. This negligence can result by alteration of a product, assembling a product or making false
representations about the product. Sellers will also be liable if they've dealt with a foreign manufacturer that
3. Does not create a defense against
has no assets in the U.S. or with a manufacturer that has gone out of business.
liability for products that comply
with Government standards.
Punitive Damages: The bill creates a uniform standard for punitive damages. A claimant must prove "by clear
and convincing evidence" that the defendant's conduct manifested a "conscious, flagrant indifference" to the
4. Does not preclude courts from
public safety. The bill also makes it possible to consider punitive damages apart from the issues of liability and
allowing evidence about product
compensatory damages.
improvements to be admitted in
S. 640 establishes a defense against punitive damages for drugs and medical devices that have pre-market FDA
cases.
approval and aircraft with pre-market certification from the FAA. These defenses would not apply if the
defendant committed fraud, withheld information or bribed FDA or FAA officials in obtaining the approval or
5. Does not create a "state-of-the-
certification.
art" defense for manufacturers.
It should be noted that only Great Britain, which does not use a jury system, and the United States allow
punitive damages. The rest of the world, including Japan, does not provide for punitive damages at all.
6. Does not create a defense for
manufacturers of products that are
Several Liability for Non-Economic Damages: Consumers, insurers and businesses have long been victimized by
"inherently dangerous" or
the joint and several liability rule (i.e. the "deep pocket rule") which makes it possible to force any defendant to
"unavoidably unsafe".
pay the entire damages even if that defendant is only minimally at fault and other persons who were at fault were
not sued or could not pay. S. 640 adopts the California law--each defendant will be liable for non-economic
7. Does not contain a broad statute of
damages (pain and suffering, emotional distress) only in proportion to the defendant's share of the responsibil-
repose for consumer products, unlike
ity for the harm. S. 640 does not affect joint liability for economic damages such as medical costs and lost wages.
the European Economic Community
which has a 10 year statute of repose
Alcohol and Drug Defenses: S. 640 adopts Washington State law in disallowing suits when a claimant's use of
for all products. S. 640 has a statute
alcohol or illicit drugs was determined by a jury to be the primary cause (more than 50%) of the injury. This
of repose of 25 years only for capital
means consumers will not have to pay exorbitant prices for products to cover drug or alcohol induced damages.
goods. Even then, the statute only
operates to bar a claim if the
claimant is eligible to receive
Workplace Safety: Currently, employers can recover any workers' compensation they have paid to an injured
workers compensation benefits for
employee by filing a subrogation lien on the employee's suit with a manufacturer. As an incentive to employers
the harm.
to provide a safe workplace, the bill would disallow the lien if the employer was at fault for the injury (e.g. by
removing a safety guard or not providing adequate training.)
Mk/Smor
Hulk — Hogan
Tort Reform/Ross. Rm.
"Urban compands 1992
"I'm not gonn fightyon
I'm gonna Suc you
Wash Times Movie Review
Bryan
Statitistics: Legal/ Civil Justice Reform
New Data on US
A soon to be published study [by NAM] estimates that
"businesses and consumers will spend between $163 and
$201 billion on legal services in 1992.'
This figure does not include damage awards or in-house
legal fees paid by many businesses. It does include
payments to law firms for travel and other
disbursements. [Source: NAM/ study author]
A soon to be published study [by the Tillinghast, A
Towers Parrin Company, Hartford consulting firm]
estimates that "the total direct costs associated with
the US tort system in 1991 are $132 billion." [Source:
Tillinghast, Co./ study author]
This figure does include settlements and benefits paid
to third-parties and plaintiffs, as well as
administrative costs.
It does not include the costs to business and to states
of workers' compensation benefits, which "totalled
another $64 billion in 1991." It also does not include
indirect costs of our tort system.
The soon to be published Tillinghast study shows that
"US costs of tort litigation have more than quadrupled
since 1950, as a percent of GDP."
-- Today, the US costs of tort litigation
account for 2.3 % of total US GDP.
--
By comparison, tort litigation costs in Japan
account for only 0.7 percent [i.e. less than
one percent] of that nation's GDP, a figure
that has remained steady since 1970, while
our litigation costs have risen.
--
Similarly, tort litigation costs in France
account for only 0.9 percent [i.e. less than
one percent] of that nation's GDP, and since
1970, tort costs in France have been falling.
-2-
Data on Wisconsin
In 1980 [most recent data], Wisconsin:
--
Had 9,117 lawyers
--
Had a State population/lawyer ratio of 516/1
--
Had more lawyers than 33 other US States
--
Had 1.7 percent of all lawyers in US
D DANGER OF WARN
GER OF
AWAY FROM SUFFC
R PLAYPENS. BEDS,
THE WHITE U HOUSE
FROM
USE IN CRIBS, BABIE!
CRIBS,
WASHINGTON
YPENS.
THIS IS
DRIVE WITH WARN
DATE: 8/31
E WITH
ICE. REMOVE AUTO
EMOVE
EFORE
START-
TO: Steve Provost
ION PO
TI
DSSIBLE
IN TU
FROM: JOSHUA BOLTEN
JB. UN-
Deputy Assistant to the President for
Legislative Affairs
USE CU
2nd Floor, West Wing, x2230
URLING
THIS T
Steve :
TOOL IS
MATER
PI
RIAL, IT
MANY
Aittached is private sector coalition;
WAYS
ODILY I
AND S
URSELF.
LL
notcbook on product liability - Pls. return
INJURY.
SAFETY
to me when done. (I got this one from VPs ofc)
UFFOC
ATION:
LEEPING
VER-IN
FA
Castellami's phone e address is on sheet
G.
NFLATE.
ESSURE
in inside pocket.
PUMP
AVE CHILDREN TO INI
IILDREN
IS NOT A UNAT1
Good luck. Let he know how we can help
NOT A
LIFESA
IRATOR HELPS WARN
RTAIN DUSTS PROTE
Josh
HELPS
DUSTS
IAY RESULT IN AND N
SULT IN
SICKNI
AFETY PRO- USE 0
I-DUCTS
) ADULT DIS- DUCTS
RETION.
HILDPROOF. CRETIO
IDUCTS ELEC- DANGI
; ELEC-
L! USE CARE TRICIT I! DE CAKEFUL! USE CARE TRICITI! BE CAKEFUL! USE CARE
OWER LINES WHEN USING NEAR POWER LINES WHEN USING NEAR POWER LINES
ITS.
AND
AND ELECTRICAL CIRCUITS.
ISE A LADDER YOU SHOULD NEVER USE A LADDER YOU SHOULD NEVER USE A LADDER
OD PHYSICA YOU Product NOT IN GOOD,PHYSICAL,LEYOU ARE NOT IN GOOD PHYSICAL
'ALK, BOU CONDITION NEVER WALK, BOUNCE CONDITION. NEVER WALK, BOUNCE
LE ON IT.
OR MOVE LADDER WHILE ON IT.
OR MOVE LADDER WHILE ON IT.
AGED LADDER NEVER REPAIR DAUgOED LADDER NEVER REPAIR A DAMAGED LADDER
FROM MAN- WITHOUT PERMISSION FROM MAN- WITHOUT PERMISSION FROM MAN-
UPA
EVERY COMPANY IS VULNERABLE TO LITIGATION
MYTH:
Companies have nothing to worry about as long as they act
responsibly.
FACT:
Under today's laws, even responsible companies have to worry.
According to a 1988 study by the Rand Institute for Civil
Justice, 87 percent of American companies will become
defendants in a product liability claim at least once!
At this rate, moving operations offshore seems the only
rationale decision for companies that do not want to be dragged
into court. Piper Aircraft recently announced it was moving
from Vero Beach, FL to Saskatchewan, Canada because of
product liability costs.
Liability costs in the U.S. are fifteen times greater than in Japan
and twenty times greater than in Europe.
Because of rising legal costs, even a successful defense can
prove damaging to businesses. And, under the "deep pocket
rule," in some states, even defendants who are found to be only
one percent responsible for an injury are vulnerable for the
entire amount of the damage award.
1001 Nineteenth Street North
PLCC
Suite 800
Product Liability Coordinating Committee
Arlington, Virginia 22209
(703) 276-5045
Fax: (703) 276-5024
John J. Castellani, Chairman
mitted to Fair Federal Product Liability Reform
William D Fay, Executive Director
HIGHLIGHTS OF TESTIMONY BEFORE THE
SENATE SMALL BUSINESS COMPETITION SUBCOMMITTEE
NOVEMBER 7, 1991
"The tangled web of 50 different laws on product
liability threatens this innovative spirit among small
business owners. There is too much uncertainty for
businesses operating in or attempting to break into the
national marketplace. Potential liability is
"
unpredictable once a product enters interstate commerce.
"
the Will-Burt Corporation of Orville, Ohio was
forced to close plants and lay off 80 workers because
the company stopped making parts for ladders, scaffolds,
and aircraft - products that encountered potential
liability costs
the Chief Executive Officer of the
Will-Burt Corporation
emphasized to me that product
liability reform is not just a good idea for the
purposes of increasing small business profits -- it's a
necessity for small business survival.
"The threat of liability cannot be underestimated what
it will do is make further innovation in a product line
less appealing."
R. Wendell Moore
Acting Chief Counsel for Advocacy
U.S. Small Business Administration
"Small businesses are active suppliers to the lead firms
in the automobile, aircraft, and pharmaceutical
industries to the extent that lead companies are
harmed by liability problems, then the supplier firms to
these industries, which are largely small firms, are
definitely injured." "
American Mining Congress
The Business Roundtable
U.S. Chamber of Commerce
Chemical Manufacturers Association
Coalition for Uniform Product Liability Law
National Federation of Independent Business
National Association of Manufacturers
The Product Liability Alliance
LIABILITY TAX RAISES PRICES
MYTH:
Liability costs are a negligible factor in product pricing.
FACT:
Liability costs add greatly to the price of products, and even minor
price increases affect market share, production, and jobs.
Americans now depend on single companies to supply vaccines
for polio, measles, mumps, rubella, and rabies. Lederle
Laboratories, the lone maker of the diphtheria, pertussis, and
tetanus (DPT) vaccine, raised its price per dose from $2.80 to
$11.40 in 1987 to cover the costs of increased lawsuits.
In a recent article in Product Safety and Liability Reporter, Vice
President Quayle pointed out that the Hepatitis B vaccine costs
$160 here and only $12 in Taiwan, because of the cost of U.S.
product liability laws.
Rawlings Sporting Goods announced in 1988 that it would no
longer manufacture, distribute, or sell football helmets. Joining
Spaulding, MacGregor, Medalist, Hutch and others who have
stopped manufacturing helmets, Rawlings was the 18th company
in 18 years to give up the football helmet business due to
increasing liability exposure. Two manufacturers remain.
According to The Liability Maze, Brookings Institution
authors estimate that liability costs in 1987 added from
$70,000 to $100,000 per light aircraft that year, and
directly contributed to the decline of the American small
aircraft industry.
Some states allow drunks who fall off ladders to sue a ladder
manufacturer. That is one reason why today 20 percent of the
price of a ladder is attributed to product liability costs.
REMARKS
OF
MARILYN TUCKER QUAYLE
NATIONAL REPUBLICAN LAWYERS ASSOCIATION
MONDAY, AUGUST 17, 1992
HOUSTON, TEXAS
2
Thank you Bob --
It's been 16 years since Dan and I removed the Quayle and
Quayle shingle from a small law office on Main Street in
Huntington, Indiana. Half of the shingle was becoming a
congressman, and eventually half of the Bush/Quayle ticket.
3
The other half of the shingle was advised to put a law career on
the back burner to avoid any conflict of interest. So, like most
clients, I reluctantly took the advice. I packed up the lawbooks
and legal pads in boxes, where we are confident they'll stay for
at least another four years.
4
But just because I haven't been mixing it up in the courtroom
doesn't mean that I haven't kept up with what's going on in our
profession. One thing I do know: there's many more of us.
The number of lawyers has almost doubled in the past 20 years.
And, partly as a result, case filings have skyrocketed.
5
More isn't always better.
Our courts have become
overburdened -- and our obsession with the lawsuit knows no
bounds.
Today, it takes over a year for the average case to be resolved.
In the past year alone, the number of cases that were pending
for 3 years increased by 15 percent.
6
Some of you may remember that a year ago this month, the
Vice President presented the Administrations Civil Justice
Reform recommendations to reduce costs and delays in litigation
before the American Bar Association.
7
You remember the ABA: It's that group whose latest exploits
include attacking the Administration because we are too tough
on violent criminals, giving honor to Hillary Clinton and Anita
Hill, working against reform to maintain the status quo and their
financial interest.
8
Well, I'm proud to say that the Bush/Quayle Administration has
given the ABA a lot to fight.
Now, don't misunderstand me. My husband is not anti-lawyer,
nor am I. My profession -- our profession -- is fundamental to
society. But our obligation to the rule of law is too important to
squander on frivolous litigation or dilatory tactics.
9
Time and again, the organized bar has ignored the costs imposed
by our overly litigious society.
First, there has been the problem of direct payments to lawyers.
The longer the case, the more the meter runs.
10
And the more time spent litigating, the less time can be spent on
innovation, research and development, or product design.
The very idea of lawsuits chills innovation. While the cost of
lost opportunities is virtually incalculable, we do know that
almost half of all U.S. manufacturers have withdrawn products
because of litigation concerns.
11
Too often, manufacturers think it is wiser to shelve a new idea
or lay off an assembly line of American workers than risk the
chance of being sued over a new product.
12
I know of one company that developed a suitcase-sized, kidney
dialysis machine that could be used at home. But, because of
concerns of nuisance law suits, the company decided against
selling the dialysis machine in the United States. Instead, it sold
the patent to a foreign company, and Americans lost out.
13
The Civil Justice reform proposals are designed to move people
to reach agreements earlier, rather than waiting until the last
moment.
In fact, people would not be allowed to file suit unless they have
attempted, and failed, to reach a resolution.
14
After a case is filed, the parties would be required to attend
mandatory conferences and attempt to resolve the dispute in a
swift, consensual manner.
15
The "Fairness" or "Loser-Pays" rule would force parties to
evaluate their cases with more care. No longer would plaintiffs
bring lawsuits purely as a form of harassment; no longer would
defendants maintain insupportable positions. When the loser
pays the winner's fees, the system quickly becomes more
rational.
16
There has been a lot of talk about these proposals in the last
year. The Vice President's office has received thousands and
thousands of letters of support. These letters say, Americans
want a fair system. They say, Americans want results. Then
what is the hold-up: It's the Democrat-controlled Congress.
17
And the reason is money. Those who benefit the most from the
current, overburdened system, the trial lawyers, have been
spending a lot of money convincing Congress not to make
needed changes.
18
Last year, the Association of Trial Lawyers of America was the
2nd largest PAC in terms of donations to candidates for
Congress. Almost 7 out of every 8 ATLA dollars went to
Democrats. And in the presidential race, one-third of Bill
Clinton's contributions so far have come from lawyers or
lawyer/lobbyists.
19
But this hasn't stopped the Bush\Quayle Administration.
We have kept pushing forward to reform the legal system. And
in addition to Civil Justice Reform, the Administration has
championed reforms in product liability to create substantive
laws that are fair and uniform.
20
We have introduced medical malpractice reforms that seek
improved health care and lower legal costs. We have drafted
laws to protect volunteers from unwarranted exposure to legal
liability.
21
In manufacturing, our companies have been facing liability costs
fifteen times greater than in Japan and twenty times greater
than in Europe. And those costs mean jobs. Eight percent of our
manufacturers have closed plants due to product liability
concerns.
22
Litigation -- malpractice litigation and resulting costs -- also exact
a heavy burden on our health care system.
Three-fourths of all obstetricians have been sued; 12 percent
have given up their practice all together. In 1990, the average
jury verdict in medical malpractice cases was over $1.7 million.
23
And we wonder why health insurance costs are soaring.
The Administration's Health Care Liability Reform Act will help
bring these costs in line. Who doesn't like it? The trial lawyers.
24
For most of my adult life, I have been involved with charitable
efforts. I've worked side by side with hundreds of wonderful
people who have given their time and support to help others.
Without pay. Without asking for favors in return. Without their
meters running.
25
This activity is the cornerstone of the President's Points of Light
Foundation. But the flood of lawsuits threatens to sweep away
potential volunteers and drown some very worthwhile
community efforts. In Little League Baseball, for instance, the
liability insurance they need per league increased from $75 to
over $750 annually in just five years.
26
Obviously, some cannot afford these higher costs. No one wants
the box score to read: "Game called on account of lawyers."
The Bush\Quayle Administration has proposed legislation to
protect those performing voluntary community service from
personal liability. Now it's up to the states to enact these
needed protections.
27
Let me underscore that more often than not, our legal system
does its job, albeit slowly. When people are injured by defective
products or when doctors fail to practice skillfully, the system
usually works to provide the victim compensation.
But let's not fool ourselves.
28
In the last decade, the legal profession has been evolving from
a profession to a business -- one that is increasingly dominated
by escalating attorney salaries and heavier demands for billable
hours.
29
It is up to us, as lawyers and as Republicans, to bring reform to
the legal system. We know that Bill Clinton certainly won't.
He's too busy picking up his campaign checks from trial lawyers.
30
We need you, as Republicans, and as lawyers, to go out in your
communities and tell people about the Administration efforts to
change our legal system. We've all heard enough lawyer jokes
to know that as a profession, we're not popular.
82141996
JB(414)821-
1992 5:05
BRian Deke
LES PAUL
WIZARD of
WAUKESHA"
GMITARIST
from city of
WANCESHA
To
JB
Date
Time
WHILE YOU WERE OUT
M
Phone of 6082740300 Area Code Number Extension 00/1
Mike Yaktus
TELEPHONED
PLEASE CALL
CALLED TO SEE YOU
WILL CALL AGAIN
WANTS TO SEE YOU
URGENT
RETURNED YOUR CALL
statistical n
Message
Lobmist
Michael Vaughan
Merty Dr
608.237-7181
Operator
AMPAD
23-021-200 SETS
EFFICIENCY@
23-421-400 SETS
CARBONLESS
BLOCK AND ASSOCIATES
740 N. PILGRIM PARKWAY
ELM GROVE, WI 53122
September 2, 1992
414-821-1992
(FAx)414-821-1996
TO: Jeanne
FR: Brian Dake
Subject: Information - Potential Presidential Visit
Question 1 - - Hepatitis B Vaccine
According to the Pharmacist at Waukesha Memorial Hospital the cost of the Hepatitis B Vaccine
(Brand Name - Recombivax) is $55.46. Furthermore the cost of the vaccine has not increased
significantly since its introduction in 1989. Cost estimate for the vaccine when its was introduced
was approximately $52 according to the Waukesha Memorial Hospital Pharmacist.
Question 2 - - Football Helmets
According to Harley Graf, Physical Education Specialist for the Waukesha High Schools, the
cost of a football helmet currently costs between $90 and $95 a piece. According to his
information this same helmet cost approximately $50 to $55 a piece in 1982. he opined that the
cost increase was primarily the result of litigation costs involving the Helmet manufacturer 1
"Bike". For the Brookfield High Schools the costs are similar.
The nickname for Waukesha South High School is the "Blackshirts". The crosstown rival
Waukesha North has a nickname of the "Northstars". I will get back to you tomorrow with the
name of the respective coaches.
The Brookfield High Schools are Brookfield East and Brookfield Central Brookfield Central's
nickname are the "Lancers" and Brookfield East nickname are the "Spartans". Brookfield East
is coached by Mr. Jack Perry while Brookfield Central is coached by Rick Synold.
Question 3 - - Little League Liability
According to the risk management specialist for the City of Waukesha, Rick Jonanis, the cost
of liability insurance for the Little League Baseball program is covered under an umbrella policy
for the entire City of Waukesha. He informed me that they could not "break-out" the cost of the
little league liability nor could he give any clue as to whether there has been an increase or
decrease in the cost. Furthermore Wisconsin State Statute 895.52 states that the the city's
liability for injury is limited to errors on the part of the Waukesha Park and Recreation
Department. i.e. the City is not responsible or liable if two players collide but could be liable
if a player breaks his leg sliding into an improperly positioned base.
44 EAST MIFFLIN STREET, SUITE 305, MADISON, WT 53703
208 G. STREET, N.E., WASHINGTON, D.C. 20002
608-284-1992-(FAx)608-258-1774
legal sprech-
hil 1 She
BLOCK AND ASSOCIATES, INC.
fair-
740 N. PILGRIM PARKWAY
ELM GROVE, WI 53122
yrs. ago.-got
ndof potentracy
414-821-1992
(FAX)414-821-1996
Wable rider
A State legs husband is
obstervician first to Start
climic
FAX TRANSMITTAL
-
me of He becter states is avoiding
regs- people like to practive ther
don't have a vindictive stourl system
Date:
9/2/92
Time:
6:25 * affluent county!
cave in niral areas prob
FAX #: 1-202-456-6218 # of pages (including this page): 2
Company:
The White House
Attention: Jeanne
From: Brian Dake
Special Instructions: Here CS the information you
requested Please call mc tought or
Hommorrow morning if you need
add-tional information
Note from Mark: Brookfield Central Hush School,
Jerry Keyes, Athletic Director, Brookfrew Lancess
Notes
Confidential Fax Transmission
The information contained in this fax message is privileged and confidential information,
intended only for the use of the individual or entity named above. If the reader of this fax
message is not the intended recipient or the employee or agent responsible for delivering it to
the intended recipient, please immediately notify the sender by telephone of your inadvertent
receipt.
LAW
Learning That Defense Is No Game
More Referees
Continued From Page BI
for scholastic games. "I think some of our
special legal standing in liability and other
better. older officials are just quitting."
Those who remain are loading up on lia.
suits, but challenges were rare. Now, more
Play Defense-
amateur athletes want to participate while
bility Insurance. Policles are cheap for of
holding officials accountable for many of
ficials who are part of large organizations.
the risks, legal analysts say. So far. they
as most are. For $2 a year each, umplres
add. the trend hasn't extended to profes-
of the American Softball Association can
In the Courts
sional athletes. who are more inclined to
get a $10 million liability policy.
But even with such coverage. many offi-
accept the risks of their games.
cials bristle at the notion that the fouls
Some observers of the sporting scene
By ROBERT TOMSHO
say the problem reflects the rise of litiga-
they call during games can lead to months
Staff Reporter of THE STREET
tion in all sectors of society. Others blame
in court. "We're supposed to be out there
In the arena of sports officiating. law.
the media glare that has exposed the once-
being impartial arbiters of the game,"
suits are becoming as common as striped
carefree sports world's seamy underbelly:
says former college basketball official Mel
shirts and silver whistles.
drug troubles, labor disputes and televised
Narol. a Princeton, N.J., lawyer who spe-
Consider the case of Jim Bain, a part-
cializes in defending referees against such
time Big Ten basketball official. During a
images of big-league managers kicking
dirt at officials. "Sports has lost the magi-
suits. "Now referees spend much of their
crucial 1982 Iowa-Purdue game. he called
cal quality that set it apart from everyday
time thinking about risk awareness.
a last-second foul that gave Purdue both
life." says sports sociologist James Fry of
With good reason. Lawsuits have ac-
the victory and a post-season tournament
berth. An Iowa souvenir company faced
the University of Nevada at Las Vegas.
cused officials of being responsible for ev.
"For a long time, referees in sports were
erything from broken bottles on the play-
with a suddenly devalued inventory chal-
sort of an unchallenged authority. Now
ing field to deadly bolts of lightning. In a
lenged his call with a $175,000 negligence
there isn't anything that can escape legal
case still pending. a Cooperstown. N.Y.,
suit in state district court, claiming he had
bat girl sued some American Legion um-
wrongly harmed its ability to sell the sou-
venirs. Mr. Bain, a Missouri mortgage
liability." The growing litigation has sent shud-
pires for $1 million after she was hit in the
banker. won, but only after a two-year
ders through the ranks of the nation's
head by a bat being swung by an on-deck
batter. A New Jersey umpire was sued by
court battle that went all the way to the
250,000 amateur sports officials, whose pay
a catcher who was hit in the eye by a soft-
Iowa Supreme Court. "It is absolutely
ranges from a miserly $8 for a junior-var-
sity soccer match to $450 for college foot-
ball while playing without a mask; he com-
blowing the whole perspective of sports out
ball bowl games. Many have given up their
plained that the umpire should have Tent
of proper focus," he complains.
him his. The catcher walked away with a
Mr. Balli isn't the only sports official
avocation. The Amateur Softball Associa-
facing legal wrangles. Across the country.
tion's roster of umpires has declined to 57,-
$24,000 settlement.
000 from 63,000 in 1983, and other amateur
Hofstra University's athletic director.
amateur referees at softball diamonds,
high school stadiums and college field
sports groups report similar losses.
Jim Garvey, was sued in 1985 after he offi-
houses are finding that their decisions can
"Some of our people got to the point
clated a college basketball game during
where they were just afraid to work be-
which a St. Bonaventure University player
trigger major-league lawsuits. Defense
cause of the threat of lawsuits," says Dot
punched and broke the jaw of an opponent
costs-which can exceed $100,000 in cases
that go to appeal-and time lost from de-
son Lewis of the Southwest Officials Asso
from George Washington University. The
fendants' full-time jobs are taking much of
ciation in Dallas. which provides officials
victim sued the officials for unspecified
damages in District of Columbia superior
the sport out of refereeing. None of the
court, claiming they hadn't been In control
suits have resulted in huge judgments so
of the game. Mr. Garvey won, but not be.
far, but some settlements have exceeded
fore he spent two years taking weeks off
$50,000. The Increasing tumult has
work and traveling from his Lido Beach.
prompted several states to grant legisla-
N.Y., home to Princeton and Washington,
tive relief and many more to consider it.
D.C., to testify and give depositions.
Holding Officials Accountable
"Guys working for $25 a game don't
Statistics are hard to come by. but at-
want to deal with this sort of trouble." Mr.
torneys, referees' organizations and insur-
Garvey says. "It's almost not worth the
ance companies say the number of such
suits is growing steadily. "There were only
aggravation." Croups such as the National Association
a handful a decade ago," says John
of Sports Officials have responded by lob
Spiotta, vice president of Bollinger Co., a
bying state legislatures for laws limiting
New Jersey company that handles sports
sports officials' legal liability to case:
insurance. "Now, it's up in the hundreds."
where gross negligence can be proved
Until recently. sports referees had no
Some attorneys' groups oppose those el
Please Turn to Page B3. Column 1
forts, saying no one should receive suc
immunity. "It can create a scenario wher
someone injured because of someone else'
act can't be compensated for their bills,
says Richard Mason, director of It
Kansas Trial Lawyers Association. Sti
Kansas, Arkansas, New Jersey and thre
THE WALL STREET JOURNAL FRIDAY. AUGUST 11. 1989
other states have passed such laws. at
bills have been introduced in 15 others
The national sports officials' group al
has urged its 14,000 members to take 1
legal offensive by suing or press:
charges against players or fans who phy
cally assault them during a game. I
even the group's president. Barry Ma
doesn't expect that to end the noseton
arguments that have always been part
referee's job. "In our minds. we're pre
blv right 95% of the time." would be Mr. half Mano
But
I
don't
think
it
THE WHITE HOUSE
WASHINGTON
DATE: 9-3-92
TO: Steve Provost
FROM: J. RUSSELL GEORGE Dah
Associate Director for Policy
Office of National Service
Room 100, OEOB, x6266
Per our conversation.
LIME BROWN Books OF ANECNOTES
LILLIE
356
357
LINCOLN, ABRAHAM
London apartment," she told him. "Why don't
anywhere in the United States. He proposed a
to be put off, Lincoln asked for and got $10 as
"Whatever is the matter with the boys, Mr.
you go there and pick it up?"
generous settlement to the defeated Southerners,
his legal fee. He gave half of this to the defend-
Lincoln?" he asked. "Just what's the matter
hoping to heal the wounds caused by the war,
ant, who thereupon willingly confessed to the
with the whole world," replied Lincoln resign-
7 At a reception given for Josephine Baker on
but only a few days after its end he was assas-
debt and paid up the $2.50, thus settling the
edly. "I've got three walnuts, and each wants
one of her trips to New York, many theatrical
sinated while attending the theater in Washing-
matter to the entire satisfaction of the irate
two."
personalities were invited. Among them was
ton. The most famous of Lincoln's speeches is
plaintiff.
Beatrice Lillie, who patiently waited her turn to
the Gettysburg Address (1863). A vast fund of
9 When Lincoln ran for Congress as a Whig
greet the fabulous Josephine. Unfortunately,
anecdotes and humorous stories by him or told
5 (A clerk of the court relates the only occa-
in 1846, his Democratic opponent was an evan-
Miss Baker chose this occasion to put on her
of him have accumulated under his name. Many
sion on which he was fined for contempt of
gelical Methodist, Peter Cartwright. During
well-known regal air. Holding out her hand for
are doubtless apocryphal.
court.)
the campaign Lincoln attended a religious
Beatrice to kiss, she purred, "Ah, Lady Peel, eet
"Davis fined me five dollars. Mr. Lincoln
meeting at which Cartwright, after a stirring
is a great plaisir." Bea Lillie glanced at the prof-
1 As a young man Lincoln was captain of a
had just come in, and leaning over my desk had
address, invited all those who wished to go to
fered hand: "Ah likes you too, honey," she
militia company during the Black Hawk War
told me a story so irresistibly funny that I broke
heaven to stand up. A few people rose self-
said.
of 1832. He was not well versed in military
out into a loud laugh. The judge called me to
consciously to their feet. "Now all those who
procedures. One day, as he was leading a squad
order, saying, 'This must be stopped. Mr. Lin-
do not wish to go to hell will stand!" The rest of
8 (Clifton Daniel tells the following story.)
of some twenty men across a field, the appro-
coln, you are constantly disturbing this court
the audience, with the exception of Lincoln,
"One bright day on Piccadilly I saw an un-
priate word of command for getting them into
with your stories.' Then to me: 'You may fine
stood up. Cartwright saw an opportunity to
mistakable figure approaching — Bea on the
position for marching through a gate went right
yourself $5.00.' I apologized, but told the judge
embarrass his rival. "May I inquire of you, Mr.
arm of a man. She had been abroad entertaining
out of his mind. In desperation, he shouted,
the story was worth the money. In a few min-
Lincoln, where you are going?" Lincoln stood
the 'troooops,' as she called them, and I hadn't
"This company is dismissed for two minutes,
utes the judge called me over to him. 'What was
up and said calmly, "I came here as a respectful
seen her for a long time.
and will fall in again on the other side of the
that story Lincoln told you?' he asked. I told
listener. I did not know I was to be singled out
"As she came down the street I maneuvered
gate."
him, and he laughed aloud in spite of himself.
by Brother Cartwright. I believe in treating
myself so that she could not avoid running into
'Remit your fine,' he ordered."
religious matters with due solemnity. I admit
me. When she did she threw open her arms and
2 When Lincoln was a lawyer, an out-of-
that the questions propounded by Brother
embraced me.
town case required him to hire a horse from the
6 A New York firm wrote to Lincoln, then
Cartwright are of great importance. I did not
"Darling," she cried, 'how are you?' Still
local livery stables. Returning the animal, he
practicing law, requesting information about
feel called upon to answer as the rest did.
holding me, she leaned back and examined my
asked the liveryman whether he kept the horse
the financial circumstances of one of his neigh-
Brother Cartwright asks me directly where I am
face. 'And who are you?'
for funerals. "Certainly not," said its owner
bors. The reply was as follows: "I am well ac-
going. I desire to reply with equal directness: I
indignantly. "I am glad to hear it," said Lin-
quainted with Mr.—, and know his circum-
am going to Congress."
9 In Hollywood one day, Miss Lillie was ab-
coln, "because if you did, the corpse would not
stances. First of all, he has a wife and baby;
{One of many Lincoln anecdotes of
sentmindedly driving on the left-hand side of
get there in time for the resurrection."
together, they ought to be worth $50,000 to
doubtful authenticity.)
the road when she suddenly noticed another
any man. Secondly, he has an office in which
car bearing down on her. She swerved to the
3 Lincoln's friend and fellow-lawyer Ward
there is a table worth $1.50, and three chairs,
10 In 1858 the Illinois legislature elected Ste-
left and crashed, wrecking the car but escaping
Lamon was on circuit in Illinois. While waiting
worth $1.00. Last of all, there is in one corner a
phen A. Douglas senator instead of Lincoln. A
with a few cuts and bruises. She staggered to
outside the courtroom, Lamon was challenged
large rat-hole which will bear looking into. Re-
sympathetic friend asked Lincoln how he felt.
the nearest house, which happened to be that
to a wrestling match and in the struggle tore the
spectfully yours, A. Lincoln."
"Like the boy who stubbed his toe; am too big
of film star John Gilbert. "Why, Bea! What's
seat of his trousers. Immediately afterward he
to cry and too badly hurt to laugh."
up?" cried Gilbert as he opened the door.
was summoned into court for a case. His short
7 During his time as a lawyer in Springfield,
(Adlai Stevenson, when defeated by
"Heard there was a party," gasped Miss Lillie.
coat did not conceal the damaged condition of
Lincoln was walking into town one day when
Dwight Eisenhower in 1952, ruefully re-
"Came."
his trousers. One of the other lawyers face-
he was overtaken by a man driving in the same
called this story.)
tiously started a subscription paper to buy him
direction. Lincoln hailed him and asked, "Will
a new pair, and it was passed around the var-
you have the goodness to take my overcoat to
11 Stephen Douglas was attempting to dis-
LINCOLN, Abraham (1809-65), US states-
ious members of the bar. When the paper
town for me?"
comfit Lincoln by making allusions to his lowly
man; 16th president of the United States (1861-
reached Lincoln, he wrote his name and under
"With pleasure," responded the stranger,
start in life. He told a gathering that the first
65). Born in a log cabin, Lincoln was a self-
the column for the amount the words: "I can
"but how will you get it again?"
time he had met Lincoln it had been across the
educated man. He became a lawyer and in 1847
contribute nothing to the end in view."
"Oh, very easily; I intend to remain in it."
counter of a general store in which Lincoln was
entered Congress as a representative from Illi-
(This may be a standard joke, attributed
serving. "And an excellent bartender he was
nois. An opponent of slavery, he was elected
4
In his legal practice Lincoln was never
-like many others- to Lincoln.)
too," Douglas concluded. When the laughter
president on an antislavery ticket, an election
greedy for fees and discouraged unnecessary
had died away, Lincoln got up and said, "What
that precipitated the secession of the Southern
litigation. A man came to him in a passion,
8 On hearing the anguished cries of children
Mr. Douglas says is quite true: I did keep a
states and the Civil War. In 1863 Lincoln issued
asking him to bring a suit for $2.50 against an
in the street, one of Lincoln's neighbors in
general store and sold cotton and candles and
the Emancipation Proclamation, freeing South-
impoverished debtor. Lincoln tried to dissuade
Springfield rushed out of his house in alarm.
cigars and sometimes whiskey, and I particu-
ern slaves, and two years later masterminded
him, but the man was determined upon re-
There he found Lincoln with two of his sons,
larly remember Mr. Douglas, as he was a very
the Thirteenth Amendment, prohibiting slavery
venge. When he saw that the creditor was not
both of whom were sobbing uncontrollably.
good customer. Many a time I have been on