Statement of Administration Policy: H.R. 956 - Common Sense Legal Reform Act of 1995

(Senate)
(Hyde (R) Illinois and Hoke (R) Ohio)

The Administration opposes the Gorton substitute to H.R. 956 (text of S. 565 as reported by the Senate Committee on Commerce, Science, and Transportation), because of two objectionable provisions. These provisions, which are described below, should be deleted from the Gorton substitute:

• Section 8(b), which would impose an artificial ceiling on the amount of punitive damages that may be awarded in a product liability action. The Administration believes statutory caps are improper because they ignore the fundamental purpose of punitive awards: to punish and deter. A statutory cap invites a wealthy potential wrongdoer to weigh the risks of a capped punitive award against the potential gains or profits from the wrongdoing.
  
  
• Section 10, which would abolish joint-and-several liability for noneconomic damages (e.g., pain and suffering).
  Noneconomic damages are as important to victims as economic damages and must not be relegated to second- class status. There is no reason for a Federal statute to preempt State laws that recognize the importance of noneconomic damages.

The Administration would strongly oppose these provisions in any legislation, including medical malpractice legislation.

The Administration, however, would support the enactment of limited, but meaningful, product liability reform at the Federal level. Any legislation must fairly balance the interests of consumers with those of manufacturers and sellers and should respect the important role of the States in our federal system.