Class Action Fairness Act of 2003

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, we have heard discussion of the so-called Class Action Fairness Act. I oppose the Class Action Fairness Act for the simple reason that it is not fair. Actually, the legislation makes it more difficult for citizens to protect themselves against violations of State civil rights, consumer, health, and environmental protection laws. The way it would hurt them is it would force these cases out of convenient State courts, which have experience with the legal facts and issues involved in such cases; instead, it would push them into Federal courts with new barriers to lawsuits, with new burdens on plaintiffs.

For the many Americans who are watching this debate, we have to at least mention the first, basic question that scheduling this debate right now raises. Here we are, 3 weeks beyond October 1. October 1, of course, is the beginning of the new fiscal year. It is a deadline for passing the appropriations bills that fund the basic work of the Federal Government. It is the law that the House and the Senate must pass the 14 appropriations bills that fund our Nation and do it by October 1. We have not done that. The Congress has not lived up to the responsibility the law mandates. We are in the final few weeks, if not days, of this congressional session, but here we are, 3 weeks past the legal deadline to do what we are required to do, and what we are paid to do, and instead we are devoting these precious days not to acting on the people's priorities, but we will spend several days debating a bill which is a priority of some special interests.

Over the past several weeks, I have received call after call from Vermonters who are more and more anxious over Congress's ability--in fact, Congress's willingness--to finish appropriations for fiscal year 2004. I know other Senators, both Republicans and Democrats, are getting similar calls. I have told those Vermonters who call me to hang in there. I assure them that Congress will eventually get around to doing its work.

Then the Republican leadership decides to have us consider controversial special interest legislation such as this bill. Apparently the special interests can go to the front of the line. The people's interests go to the back of the line. I suggest we have it the wrong way around. Do the people's legislation first; do the appropriations bills first;

do the things we are required to do by law. Do the work that we go back home and tell everybody we are going to do, and if there is time left over for the special interests, let them come up then; don't put them ahead of the people.

My colleagues and I who serve on the Appropriations Committee worked long and hard to get the fiscal year 2004 bills voted out of our committee. We got them all out. They could go anytime they wanted. The Republican leadership has decided not to. The House has passed all 13 of the regular appropriations bills. They are waiting for the Senate to act. We are not acting. Instead, we are bringing up special interest legislation.

The new fiscal year began 3 weeks ago, but the Senate has not even bothered to take up the appropriations bills that fund Agriculture or Commerce, Justice, State, and, our Federal law enforcement, the FBI, the Department of Justice, the actions we take to counter terrorism.

As for Commerce, we might do that, so we might actually get us some jobs in this country at a time when we are losing a million a year.

Foreign operations? That hasn't been brought up.

Transportation? We all know our roads and bridges and rail system are falling apart. We ought at least to be voting. We may vote not to give any money to fix any of the problems of the Nation. We did vote, incidentally, to send $87 billion to Iraq and we will fix their roads; we will fix their electrical system; we will fix their communication system; we will fix their postal system; we will even give them a new ZIP Code. But maybe we could take a few minutes and bring up those things that might actually pay for roads and transportation and electrical grids and ZIP Codes in the United States.

Veterans Affairs is in there. The administration is cutting veterans benefits all over the country. They are cutting our veterans hospitals. They are cutting out what is available to our veterans. At the same time we are asking our men and women to serve in Iraq, we are cutting out their money. We ought at least to bring that up. Let's vote on it.

We voted to send money to the veterans of the Iraqi army. We voted to send money there. We ought to spend some time here voting on veterans in the United States.

We have the Housing and Urban Development appropriations bills. We have a great housing shortage in this country. We just spent billions. We had plenty of time to vote billions of dollars to build houses in Iraq. We can't even bring up the housing bill for the United States, but this special interest legislation we do make time to address.

What I would say is: OK, we voted to do all these things now for the Iraqi people. Can we at least spend a day or two voting on the same bills that might help the American people at the national, State, and local levels?

Let me tell you about a few of these programs that are being pushed aside so we can take up this special interest legislation.

In the area of agriculture, there is more than $1 billion in conservation assistance for farmers to help them improve water quality and stop sprawling development. Last year, the aid was delayed by more than 4 months. Each month is critical. The men and women who farm in this country are just barely getting by.

They stalled the Justice spending bill so we could get money as quickly as we possibly could to the police forces of Iraq. But because we stalled it, there is no money for the Bulletproof Vests Partnership Program which helps State and local police agencies buy armored vests to protect the lives of their officers. This is a good bipartisan program that Senator Ben Nighthorse Campbell and I put together.

I have had police officers come up to me all over the country, people I have never met, who want to shake hands and say, We really want to thank you and Senator Campbell and those who joined you to help us get this money. Now I am going to have to tell them it is stalled. We had to wait to get the money for Iraq, that is fine, but now we have to stall again because we have special interest legislation that comes up.

Take the COPS Program; this puts new police officers on the community streets and in our schools; the Violence Against Women Act programs that provide services for victims of domestic violence, sexual assault and stalking. Those were all set aside so we could bring up this special interest legislation.

All funding for transportation and critical infrastructure projects was bottled up. In fact, the Senate has failed to pass the transportation reauthorization bill. We don't have time to bring that up. We can bring up special interest legislation, we can bring up highways in Iraq, but we can't bring up the highway transportation bill here in the United States. And what is the cost to us? It is 90,000 jobs here in America.

All foreign assistance to nations other than Iraq and Afghanistan are on hold. In fact, all the funding to combat HIV/AIDS and other infectious diseases is also on hold.

We have another group of Americans awaiting action by Congress. Those are our veterans. They need Congress to make basic decisions about their medical care and benefits, decisions that are being held in limbo, and they have no idea where we are going to go.

These are priorities. American priorities are being set aside, and we will take care of Iraq. We will take care of the special interest legislation. In fact, the special interest legislation is going to do more harm than help.

I think the American people are entitled to ask why we are bogged down considering this controversial and unfair class action bill when the Senate has yet to take up and debate five important appropriations bills amounting to $301 billion.

I hope the Senate gets down to the business of the people and carries out the responsibilities given to us by the Constitution: taking up, debating, and passing the remaining appropriations bills. And we can pass them. There will be a bipartisan majority of both Republicans and Democrats working together to pass them, if we are even allowed to vote on them. We were allowed to vote on Iraq and special interest legislation. Can we take a little bit of time to vote on legislation that actually helps the people of America?

The American people and the people around the world depend upon the funds and services supplied through the spending measures that are now held hostage. Let us do our job. Let us move these bills. Let us spend a couple of weeks on the floor of the Senate legislating for the people of America. It would be a nice refreshing time. We could pass these bills.

Earlier this year, I joined with Senators Kennedy, Biden, Feingold, Durbin, and Edwards in requesting a hearing on class action litigation in order to help the Judiciary Committee develop consensus reforms-- something that we could have done. Republicans and Democrats could have joined on it. But our request was ignored. Actually, our letter went unanswered.

I ask unanimous consent that the letter be printed in the Record.

Mr. President, I had hoped that the Judiciary Committee would undertake a deliberate and careful review of information from parties

actually involved in class action litigation to provide a realistic picture of the benefits and problems with class actions. But instead of doing the work for America, we are proceeding with a special interest piece of legislation which has repeatedly failed to pass the Senate in recent years. Our Judiciary Committee did not carry out the kind of thorough and thoughtful legal analysis of this difficult issue it should have. The committee did not provide our fellow Senators with the assistance that they may want and need in this complex area.

I acknowledge the hard work and dedication of my friend, the senior Senator from California, Mrs. Feinstein, who took on an enormous task, attempting with her amendment to rectify some of the harms created by this bill. I appreciate the sincerity of her concern. I appreciate the genuine effort she made. But her amendment touches on only a sliver of the class action cases which this bill would affect--only when plaintiffs and primary defendants are from the same State--and even then it could cause harm.

At its core, this bill deprives citizens of the right to sue on State law claims in their own State courts if the principal defendant is a citizen of another State, even if that defendant has a substantial presence in the plaintiff's home State, and even if the harm done was in the plaintiff's home State. The amendment does not remedy that problem. It burdens the plaintiff even more.

I also want to recognize the sincere efforts made by my friend from Wisconsin, Senator Kohl. I may disagree with him about the nature of the problem. I may disagree with the appropriate solution in this area. But I do so respectfully. He has worked very hard, and I appreciate his efforts.

I would like to note the significant changes in the bill since it passed out of committee.

As originally drafted, this bill included mass tort claims along with class actions. It actually treated them like they were class actions.

One improvement the Judiciary Committee did manage to make to the bill was to strike that provision. We struck it. We voted on that, and we struck it. But somehow, mysteriously, after the bill left the committee with nobody voting, that was reversed. Now mass tort actions are again included in this bill.

Just in case anybody says this is what we voted out of committee, it is not. We changed that.

Now we find out how we actually get things changed in the committee because, apparently, our friends on the other side of the aisle could care less about what we actually did in committee. They just change it in the draft on the way over here. It is fascinating. I have never seen that in 29 years here. But I guess we live under new rules.

In the old days, we just lived under the Senator rules. But now we have rules outside the Senate rules. In fact, this bill is not the bill reported by the Judiciary Committee, S. 274. It is another bill--S. 1751--which was introduced last week. We didn't have hearings on that. We didn't have votes on that. I guess the special interest says, OK, as soon as you finish with the roads in Iraq, as soon as you finish the schools in Iraq, as soon as you finish giving the power grid to Iraq, as soon as you finish paying for the police officers in Iraq, as soon as you are finished with veterans' benefits for Iraq, before you do anything for American citizens, give us our special interest legislation, and we can just drop it in and go forward.

The special interest legislation will be subjected to the same shunting to a Federal court, and plaintiffs will endure the same unnecessary difficulties in making their claims and pursuing their remedies. But these mass tort cases are not class actions. They have not been analyzed under rule 23 standards or State law.

Mass tort actions have entirely different procedural vehicles to reach justice than class actions. They shouldn't be lumped in with class actions in any kind of class action bill, either this misguided attempt or a better wrought piece of legislation.

Some special interest groups are distorting the state of class action litigation by relying on a few anecdotes and an ends-oriented attempt to impede plaintiffs bringing class action cases. If we really want to correct things, we can and should take necessary steps to correct the problems in class action litigation. But simply shoving most suits into Federal court with the new one-sided rules isn't going to correct the real problems faced by plaintiffs and defendants. It will clog up the Federal courts, but it won't accomplish anything.

We forget that our State-based tort system remains one of the greatest and post powerful vehicles for justice anywhere in the world-- no doubt around the world--as a vehicle for justice. It lets ordinary people ban together to take on powerful corporations--sometimes even their own government.

Defrauded investors, deceived consumers, victims of defective products, and environmental torts, and thousands of other ordinary people have been able to rely on class action lawsuits in their State court systems to seek and receive justice.

I remember when the Soviet Union broke up. A group of legislators from the Duma came in to see me, as they did several other Senators. One of them asked a question. They said: We have heard it is actually possible that citizens in your country can ban together and sue the government. I said that is true.

They said: We have heard further that not only do they sometimes sue the government, but there are times the government loses. They win.

I said: Oh, yes.

They said: You mean you don't fire the judge and make him do it over again?

I said: You don't understand our system. It is not the Soviet Union. Here in the United States, we are able to ban together to take on the government. If the government is wrong, the government is going to lose.

It was an eye-opener to them. Actually, it was a bit of an eye-opener to me because I realized those things we take for granted other countries haven't had the opportunity to have.

I am old enough to remember the civil rights battles of the 1950s and the 1960s and the impact of class actions in vindicating basic rights through our courts. When Congress sat back and did nothing, when Presidents sat back and did nothing, it was class action lawsuits that won.

The landmark Supreme Court decision of Brown v. Board of Education was a culmination of appeals from four class action cases, three from Federal court decisions in Kansas, South Carolina, and Virginia, and one from a decision of the Supreme Court of Delaware.

Only the Supreme Court of Delaware, the State court, got the case right by deciding for the African-American plaintiffs.

The State court justices understood they were constrained by the existing Supreme Court law but nonetheless held that the segregated schools of Delaware violated the 14th amendment. The Federal courts did not get it right; before any Federal court did so, a State court rejected separate and unequal schools. The U.S. Supreme Court, to their credit, joined in a unanimous decision in Brown v. Board of Education and closed down the highly discredited separate but equal idea, Plessie v. Ferguson. There was no separate but equal in the schools and they knew it--separate and unequal. The State courts realized that first in a class action suit and then the U.S. Supreme Court followed.

Many civil rights advocates, including the Lawyers' Committee for Civil Rights Under Law, Leadership Council on Civil Rights, Mexican American Legal Defense and Education, and the National Asian Pacific Legal Consortium have written to Senators in opposition to this legislation. The civil rights advocates conclude this legislation ``would discourage civil rights class actions, impose substantial barriers to settling class actions and render federal courts unable to provide swift and effective administration of justice.''

I ask their letter, dated September 16, 2003, be printed in the Record.

We all know without consolidating procedures, such as class action lawsuits, it might be impossible for plaintiffs to receive effective legal representation. Lawyers tend to be paid by the hour. They are well paid. But lawyers usually hope they get a portion of the proceedings to take on either the governmental or culprit defendants. They have to do so on a case-by-case individual basis. Sometimes that is what cheaters count on. That is how the cheaters get by on their schemes. If you cheat thousands of people just a little bit, you still cheat; if you only cheat them by $3 or $4, nobody will sue them. But if you are cheating a million people of $3 or $4 each, it adds up.

Class actions allow the little guys to band together and get a competent lawyer and address wrongdoing. The best class action made it possible for individual tobacco victims to take on the powerful tobacco conglomerates in ways individuals could not. It allows stockholders and small investors to join together and go after investment scams.

Another example of a class action litigation serving the public interest is the Firestone tire debacle. The national tire recall was started in part by the disclosure of internal corporate documents on consumer complaints of tire defects and design errors that were discovered in the litigation against Bridgestone/Firestone, Inc. Then the plaintiff's attorneys turned this information over to the National Highway Safety Administration. That started a Government investigation.

Months later, because some people had banded together, Bridgestone/ Firestone finally did what they should have done right from the beginning: They recalled 6.5 million tires--but not until after there were 101 fatalities, 400 injuries, and 2,026 consumer complaints.

As reported by Time magazine at the time, it is doubtful that the internal corporate consumer complaint information would have ever seen the light of day absent the civil rights justice discovery process.

The bill before the Senate creates unique risks and obstacles to plaintiffs that are not in the current system. A particularly troubling aspect of S. 1751 is it allows the removal of a case at any time. Anybody who has ever practiced law, anybody who has ever litigated cases--and I, as many other Senators, have--knows the possibilities for abusing this provision are obvious.

As more than 100 legal experts, law professors, noted in a letter to the distinguished Republican leader and the distinguished Democratic leader, Senators Frist and Daschle, they said:

This would give a defendant the power to yank a case away

from a state-court judge who has properly issued pretrial

rulings the defendant does not like, and would encourage a

level of forum-shopping never before seen in this country.

Moreover, this provision would allow an unscrupulous

defendant, anxious to put off the day of judgment so that

more assets could be hidden, to remove a case on the eve of a

state-court trial, resulting in automatic delay of months or

even years before the case would be tried in Federal courts.

I ask unanimous consent that the letter of the 100 law professors be printed in the Record.

Added to the ``removal-at-any-time'' problems in the legislation are the hurdles established by Senator Feinstein's amendment adopted in committee. I know it is well intentioned, but the amendment does set up cumbersome requirements for determining whether an action is to be heard in State or Federal court. It provides that a Federal judge may use five factors in deciding jurisdiction of a class action where between one-third and two-thirds of the plaintiffs are from the same State as primary defendants; and if two-thirds of the plaintiffs are from the same State as the primary defendants, then the case will stay in State court.

The bill fails to determine when this measurement takes place during the litigation. It has been my experience that membership in class actions frequently changes. So the two-thirds provision or the middle- third provision which is subject to judicial discretion could open up easily to judicial gamesmanship. The defendant could try to remove a case from State court at the discovery stage. Someone takes a deposition and finds, oops, this is going against us, let's get it out of here. Or the judge has made a ruling they do not like and they know they can never win on appeal, let's get it out of here, even after all the evidence is presented, or after closing arguments.

Actually, the way the bill is currently written, it could be done while the jury is deliberating. Considering the vast resources of defendants in many class actions as compared to plaintiffs, it will make it more difficult for class members to ever have a final ruling, where the bill will cause unnecessary and expensive litigation. It favors corporate defendants.

I like to think the scale of justice is even. This tilts the scale of justice and it will bounce right off the stand.

If there were ever a time to think about protecting the consumers, the investors, and the employees, think of Enron, WorldCom, and other corporate scandals. Think of the employees who worked so hard and were told to put their money in the corporate pension program. Look what has happened. Look at the employee investors. I am not too concerned about some of the leaders of a company like that. They might have to sell one of the $50 million homes or they no longer will have several billions of dollars but rather several hundred million, but I am worried about the people who truly had their lifesavings or their pension destroyed or their company destroyed.

This bill does nothing to make the Enrons of the world more accountable for their actions. Actually, the bill undercuts Congress's other efforts to make the companies more responsible or accountable for their misdeeds or more susceptible to penalties when they do wrong. The legislation makes it more difficult for the victims of corporate wrongdoing to join to make those companies accountable. It seems to me that is the exact opposite to the approach we should be taking.

Now, not surprisingly, consumers and those representing consumers object strongly to the enactment of this legislation.

I ask unanimous consent to have printed in the Record letters from numerous consumer advocates in opposition to this bill.

Last year a group of investors recovered millions of dollars in lost investments under State corporate fraud laws and a State class action case in Baptist Foundation of Arizona v. Arthur Andersen. These investors, mostly elderly, banded together to successfully recoup $217 million from Arthur Andersen. Why? Because of questionable accounting practices surrounding an investment trust. The case is just one example of how a State-based class action litigation holds corporate wrongdoers accountable and helps defrauded investors recoup their losses.

Like most Vermonters, I am a strong supporter of the environment. But I look at this bill and I think, what a green light for polluters and others responsible for environmental damages to avoid accountability in court. So many polluters, who would fear class action suits if they were to violate the law, now know they could get caught. With this legislation, they might take the old idea of: Go ahead and pollute; nobody gives a hoot. They are going to get away with it.

This legislation removes almost all important environmental class actions from State to Federal court. Not only does this deny State courts the opportunity to interpret their own State's environmental protection laws, but it also hampers and deters plaintiffs in pursuing important environmental litigation. It means we Vermonters would not have a say in our own courts--or those in Utah or in any other State.

Under this bill, environmental class action suits may not get litigated, reducing the incentive to keep our environment clean. Plaintiffs' attorneys may not be willing to take these high-risk, high- cost, and time-consuming cases, particularly when what they are looking for is injunctive relief. That is an injunction to stop the polluter from polluting. Intentionally or not, this bill protects polluters and ignores innocent victims of their negligence.

Just a few months ago, as I recall, we read about a horrible toxic dumping situation in Alabama and a monumental settlement in State court to clean up an entire community. It was in State court, though--in State court.

In Anniston, AL, the Monsanto Company manufactured PCBs-- carcinogens--from 1929 to 1971. For more than 40 years, in arrogant-- arrogant--disgusting disregard of people's health and the environment, Monsanto dumped untreated, unfiltered waste from its PCB plant into the streams and landfills of Anniston. They never let the residents--many of whom actually worked, and worked very hard, for Monsanto--they never let them know of the horrific risk to their environment and their health.

When the undeniable truth of Monsanto's malfeasance became clear, several thousand residents of Anniston sued in State court. They recently won a liability jury verdict. When the case moved into the damages phase, Monsanto was not out there defending and saying: Well, we did not do something bad. They knew they did something terrible. They did not start arguing about: Well, people were not injured by it. They knew they were injured by it.

So what did they do? They tried to get the judge removed. That is what they tried to do. Although the Alabama Supreme Court, a conservative supreme court, had already held that the trial judge was acting properly, Monsanto continued to oppose his participation. They tried everything they possibly could do to confuse people and escape facing up to the issues. They then had to focus on the merits of the case and settled with the local residents for $600 million and pledged to pay additional cleanup costs for the town.

The Alabama Supreme Court, the Alabama State court, did this very well. Not under this bill. Under this bill, it would have been yanked away from those courts, yanked away from the Alabama State court, yanked away from the Alabama Supreme Court, and stuck into Federal court.

Why? More than 100 people lived in Anniston. Even though all the people

suffered, they lived just a block or a driveway from each other. We, those of us who say we really care about States having their rights, would reach down and yank it right out of the State and say: You are not good enough to handle the case that involves your own people.

Cases such as this one would provide hard evidence that our State- based civil justice system is working--it is working--to protect the environment and to protect victims of polluters, and there is no reason to prefer a Federal reform for resolution of their claims. State courts, unlike the Federal courts, have a sound understanding of evolving local law and the open dockets to resolve conflicts in a manner that would protect our society from polluters.

In fact, we ought to at least ask, Do the Federal courts want this? The Judicial Conference, headed by Chief Justice William Rehnquist, wrote a letter in March of this year opposing this bill because its ``provisions would add substantially to the workload of the federal courts and are inconsistent with principles of federalism.''

They singled out serious environmental disasters as an example of class actions that should remain in State courts.

Chief Justice Rehnquist and the Judicial Conference said: What are you doing to us? Why are you sending these cases over there? State courts can handle them better.

I would be a very wealthy person if I had a couple dollars for every time I heard speeches or statements from my fellow Senators about how we have to better respect our individual States. After all, that is why we have a Senate. Each one of the 50 States has equal representation here to make sure the States are not subsumed in the Federal system. Those who would support this bill are giving the back of their hand to their States and saying: You are not smart enough, you are not good enough to take care of the laws of your own State.

Numerous organizations devoted to the protection of the environment oppose this bill, including Clean Water Action, Earthjustice, the Environmental Working Group, Friends of the Earth, Greenpeace, the Mineral Policy Center, the Natural Resources Defense Council, the Sierra Club, and the U.S. Public Interest Research Group.

These advocates conclude, in a letter, this bill ``would benefit polluters at the expense of people and communities harmed by public health and environmental disasters.'' I ask unanimous consent their letter be printed in the Record.

Mr. President, as colleagues may have gathered, I am not in favor of this piece of legislation, the Class Action Fairness Act. Man, I have heard things. There ought to be a law against misleading labels on legislation we pass because this would break the law. These many injured parties who have valid claims would have no effective way to seek relief. Class action suits have helped win justice and expose wrongdoing by the polluters, the big tobacco companies, and the civil rights violators, and brought about Brown v. Board of Education, as I said earlier. It gives average Americans at least a chance for justice. We should not take that chance for justice away from the American people.

So I hope Senators will consider the harm this bill would do the American people and to their constituents and join me in opposition.

Lastly, Mr. President, as I said, we found time to get highway money for Iraq, but we do not have time to pass the highway bill for America. We had time to get money to improve police departments and law enforcement in Iraq, but we do not have time to pass a bill to do the same here for Americans.

We had time to pass legislation to help military veterans in Iraq, but we can't find time to pass legislation for veterans in the United States.

Of course, I yield to my friend from Nevada.

Did the Senator say omnibus or ominous?

I appreciate the comments of my friend from Nevada. I can't think of any person who has worked harder to help get legislation through. The senior Senator from Nevada has a good reputation of working with both Republicans and Democrats. There are two primary reasons. One is the fact that he knows legislation better than anybody else around here. Secondly, he is totally honest and truthful to everybody.

It is frustrating because, again, there is legislation for highways in Iraq, but not in the United States, all these other things. We passed a transportation bill. That would mean 90,000 jobs right there that we could put Americans back to work.

I thank him for saying that. I don't care if people want to spend time on this bill. It is a terrible bill. If they want to spend time on it, let's at least get the appropriations bills done. Let's answer the questions of our veterans, whether the benefits will be there or not; answer the questions police officers have about benefits; answer the questions those in education have, whether the money will be there.

I see my good friend, the senior Senator from Illinois. I yield the floor.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, I rise in strong support of H.R. 1115, the Class Action Fairness Act of 2003. In years past, the occasional news account of some outrageous class action verdict or settlement was light humor. Now the stories are so common there is no punch line, the class action judicial system itself has become a joke, and no one is laughing except the trial lawyers, all the way to the bank.

Abuse of State class action lawsuits is now systemic and this mounting crisis is a threat to the integrity of our civil justice system and a persistent drain on the national economy. Since this House passed nearly identical class action reform legislation in the 107th Congress, a bill which died in the Democrat-controlled Senate, the problem has only gotten worse. One major element of the worsening crisis is the exponential increase in State class action cases, many of which deal with national issues and classes.

In the past 10 years, State court class actions filing nationwide have increased over 1,000 percent. In certain ``magnet courts'' known for certifying even the most speculative class action suits, the increase in filings over the last 5 years is approaching 4,000 percent. Take, for example, the court in Madison County, Illinois, a rural county of 250,000 people which is on pace for a projected 3,650 percent increase in class action filings over 1998 levels. Eighty-one percent of those cases sought to certify nationwide cases, including all nationwide Sprint customers ever disconnected on a cell phone, all Roto-Rooter customers nationwide whose drains were repaired by unlicensed plumbers, and all nationwide customers who purchased a ``limited edition'' Barbie doll at a higher price.

So why are all these class action cases filed there? Madison County did not experience a similar growth in population during this time, nor did it suddenly become a hub for interstate commerce. Furthermore, there is no evidence to suggest that the good people of Madison County are somehow cursed or more plagued by injuries than the average citizen. Indeed, the only explanation for this phenomenon is aggressive forum shopping by trial lawyers to find courts and judges who will act as willing accomplices in a judicial power grab, hearing nationwide cases and setting policy for the entire country in a local court.

A second major element of the present class action crisis is a system producing outrageous settlements that benefit only lawyers and trample the rights of class members. Class actions were originally created to efficiently address a large number of similar claims by people suffering small harms. Today they are too often used to efficiently transfer large fees to a small number of trial lawyers doing great harm. The present rules encourage a race to any available State courthouse in hopes of a rubber-stamped nationwide settlement that produces millions in attorneys' fees. Clearly, some trial lawyers are winners in this race, but as the Justice Department testified at the committee's last hearing, the losers in this race are the victims who often gain little or nothing through the settlement, yet are bound by it in perpetuity. These same victims and all consumers often bear the cost of these settlements through increased prices for goods and insurance.

Mr. Chairman, I would like to share with Members a survey that was published in the USA Today newspaper on Monday, March 24, 2003: ``Opinions on Class Action Lawsuits, Who Benefits the Most From Class Action Lawsuits.'' Forty-seven percent said lawyers for plaintiffs, 20 percent said lawyers for companies, 12 percent said don't know, 9 percent said plaintiffs, 7 percent said companies being sued, and 5 percent said buyers of products.

Two-thirds of the American public according to this survey indicate that the beneficiaries of class action lawsuits are lawyers and only 14 percent said plaintiffs and buyers of products. This bill is designed to change this mix so that the consumers and the plaintiffs are the ones that benefit rather than lawyers for plaintiffs or lawyers for defendants.

Summarizing the problem last November, The Washington Post editorial board in a critique of the present system wrote:

``Class actions permit almost infinite venue shopping; national class actions can be filed just about anywhere and are disproportionately brought in a handful of State courts whose judges get elected with lawyers' money. These judges effectively become regulators of products and services produced elsewhere and sold nationally. And when cases are settled, the clients get token payments while the lawyers get enormous fees. This is not justice. It is an extortion racket only Congress can fix.''

Mr. Chairman, today Congress has an opportunity to end this extortion racket and fix this problem. Article 3 of the Constitution empowers Congress to establish Federal jurisdiction over cases between citizens of different States, but current rules on class actions require that all plaintiffs and defendants be residents of different States and that every plaintiff's claim be valued at $75,000 or more. These jurisdictional statutes enacted before the advent of modern class actions lead to results the framers would find perverse.

For example, under current law, a citizen of one State may bring in Federal court a simple $75,001 slip-and-fall

claim against a party from another State. But if a class of 25 million product owners or users living in all 50 States bring claims collectively worth $15 billion against a manufacturer, that lawsuit usually must be heard in State court.

H.R. 1115 would apply new diversity standards to class actions by changing the diversity requirements for class actions where any plaintiff and any defendant reside in different States and where the aggregate of all plaintiffs' claims is at least $2 million. These modest changes will keep large actions of a national character in Federal court where they belong.

H.R. 1115 also addresses the other major area in need of reform, the incentives for settlements in class action cases and scrutiny of those settlements. Under current rules, the first case settled wins. Those left out must either find a way to join the settlement or forego their claim. This leads to bad settlements favoring lawyers over consumers in jurisdictions with lax class action requirements. In the last year, more such one-sided settlements benefiting only the lawyers occurred.

Example: A settlement with Blockbuster over late fees produced $9.25 million in lawyers' fees, and nothing more but dollar coupons for the consumers represented, only 20 percent of which are likely to be redeemed.

Another example: A settlement with Crayola over asbestos included in crayons produced $600,000 in attorneys' fees, and nothing but a 75-cent discount on more crayons for affected consumers.

In order to prevent abuses like this, H.R. 1115 aims to protect plaintiffs by prohibiting the payment of bounties to class representatives, barring the approval of net loss settlements, adopting better notice requirement provisions which clarify class members' rights, and by requiring greater scrutiny of coupon settlements and settlements involving out-of-State class members.

Finally, Mr. Chairman, it is important to note that the costs of class action abuses are not limited to the parties of the settlements. They are shared by the American consumer through higher prices and higher insurance premiums.

Class action lawsuits also pose a threat to investors and the security of American retirement plans, which are largely invested in equity securities of American corporations. While class action liability can be enormous, news of these lawsuits on Wall Street can drive down any particular stock by as much as 10 points in one day.

I also would note that we are likely to hear names like Enron, Adelphia and WorldCom tossed about today, and rhetoric that this bill would let such noted corporate wrongdoers off the hook. The truth of the matter is that nothing in H.R. 1115 would limit the rights of plaintiffs to seek redress in court in these types of cases.

Under current law, most lawsuits against these companies will be heard in Federal bankruptcy court, for the same reasons that Federal courts should be able to resolve many of the class actions. Federal courts protect the interests of diverse parties from all parts of the country. In addition, section 4 of H.R. 1115 specifically excludes a number of Federal securities and State-based corporate fraud lawsuits.

Mr. Chairman, the need to restore some common sense, fairness, certainty, and dignity in our class action system is clear. The time to act is now, and I urge my colleagues to vote for this bill and to put some sense back into our legal system.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, will the gentleman yield?

Everybody has a right to have a lawyer, but you ought to be for court reform.

Mr. Chairman, I yield myself 1 minute.

Mr. Chairman, I would be happy to invite the gentleman from Michigan to my district, or I would be happy to go to Detroit, and have him explain to my constituents or me explain to his constituents why giving a consumer a coupon for 75 cents or $1 off a product that was manufactured by the company that injured that consumer and had a judgment entered against them, while giving a lawyer hundreds of thousands or millions of dollars' worth of legal fees, or having the lawyer send a deficiency bill to every member of the class, this bill takes care of this, is correct, and how it puts consumers in charge rather than lawyers.

Mr. Chairman, I yield 3 minutes to the gentleman from Virginia, Mr. Goodlatte.

Mr. Chairman, I yield 3 minutes to the gentleman from Texas (Mr. Smith), the chairman of the Subcommittee on Courts, the Internet, and Intellectual Property of the Committee on the Judiciary.

Mr. Chairman, I yield myself 1 minute.

The gentleman from New York unfortunately has got it all wrong. What this bill does is it takes the power away from one State court judge to decide national legal and national economic policy and puts it in the Federal courts where the founders intended it to be when they established the right of Congress to establish diversity jurisdiction.

The second point that I would like to make is why did all of these consumers only get 33-cent checks? It is because the lawyers signed off in the settlement that filled their pockets to overflowing with legal fees and giving 33-cent checks to the clients that they supposedly represented. Now, if those lawyers were a little bit more fighting for their clients and less for themselves, maybe those checks would have been bigger because the fees would have been smaller.

Mr. Chairman, I yield 2 minutes to the gentlewoman from Pennsylvania (Ms. Hart).

Mr. Chairman, I yield 2 minutes to the gentlewoman from Tennessee (Mrs. Blackburn).

Mr. Chairman, I yield myself 30 seconds.

Mr. Chairman, once again the opponents of this bill are wrong. The gentlewoman from California (Ms. Waters) is talking about Enron and WorldCom cases being removed to Federal court. They already are there. Both of these corporations have filed for bankruptcy. Once there is a bankruptcy filing by anybody, the cases are heard in Federal court, simple as that.

I really would hope that they get their facts straight before they attack the bill the next time.

Mr. Chairman, I yield 1 minute to the gentleman from Florida (Mr. Feeney).

Mr. Chairman, I yield 1 minute to the gentleman from Virginia (Mr. Boucher), as well.

Mr. Chairman, I yield 2 minutes to the gentleman from Ohio (Mr. Chabot).

Mr. Chairman, I yield myself 30 seconds.

Mr. Chairman, my friend, the gentleman from North Carolina (Mr. Watt), seems to have forgotten that the civil rights laws that were passed in the 1960s were passed with Republican support because his predecessors in North Carolina would not support civil rights laws, no way, no how. Those laws took away from the States the right to ensure equal treatment of all American citizens. I am proud my party, the party of Lincoln, led the charge on that.

Mr. Chairman, I yield 1 minute to the gentleman from Virginia (Mr. Moran).

Mr. Chairman, I yield myself 30 seconds.

Mr. Chairman, I wish the Democrats would get their facts straight before they come to the floor. First, any entity, individual or corporate, that is in bankruptcy is in Federal court and all claims go there: Enron, WorldCom, anybody else that is in bankruptcy.

Secondly, page 16 of the bill, which I will send over to the gentleman from Texas (Mr. Sandlin), provides specific exemptions for the removal of class action cases to Federal court for all the types of corporate wrongdoing that he said on the floor.

Read the bill, be accurate in your arguments, and support it.

Mr. Chairman, I yield myself the balance of the time.

Mr. Chairman, this country has a crisis in manufacturing. Particularly, small- and medium-sized manufacturing jobs are going overseas by the droves, particularly to China, and there are a whole lot of reasons for that; but one of the reasons is a judicial system that is out of control.

My colleagues can talk about business, but it is business that creates the jobs that hire our constituents who pay the taxes to make the government run; and by having court reform, which is what this bill does, it is not tort reform because nobody's rights to a jury trial or to get into a court are constricted by one iota. It is where this is done and how class actions get certified and protections for consumers such as the coupon settlements and the deficiency judgments that are entered against class members.

This is going to help keep America's economy vibrant. Pass the bill.

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I offer an amendment.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, this bipartisan amendment is intended to mirror the amendment offered by Senator Feinstein over in the other body. It is in keeping with the spirit and intent of the bill and would slightly broaden the category of class action cases that would remain in State court in two ways.

First, the amendment raises the aggregate amount and controversy required for Federal jurisdiction from $2 million to $5 million. Second, it allows Federal courts discretion to return intrastate class actions in which local law governs the State courts after weighing five factors to determine the case is appropriately of a local character.

This discretion would come into play when between one-third and two- thirds of the plaintiffs are citizens of the same State as the primary defendants. If less than one-third are citizens of the same State, the case would automatically be eligible for Federal court jurisdiction under the new diversity rules in the bill. Likewise, if more than two- thirds are citizens of the same State, the case would not be subject to the new rules in this bill and would remain in State court.

I urge my colleagues to adopt this amendment to help speed passage of this important legislation.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself 15 seconds.

What the gentleman from Michigan is saying is this is a good amendment but not good enough. I think if it is a good amendment, it ought to be supported; and I know my cosponsor, the gentleman from Virginia (Mr. Boucher), will tell us it is a very good amendment.

Mr. Chairman, I yield 2 minutes to the gentleman from Virginia (Mr. Boucher).

Mr. Chairman, I yield myself the balance of the time.

Mr. Chairman, the name of the senior Senator from California, Ms. Feinstein, has been bandied about on both sides of the aisle; and she has sent a letter to the gentleman from Virginia (Mr. Boucher), which says in part: ``It is my understanding that Chairman Sensenbrenner and a number of Democrats plan to offer this as an amendment to H.R. 1115 on the House floor, and of course, I support its inclusion.''

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I yield such time as he may consume to the gentleman from Virginia (Mr. Goodlatte).

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, this amendment I think can probably be referred to as the ``back-door erosion of the 14th amendment to the Constitution amendment'' to this bill because it erodes the concept of equal protection under the law, meaning everybody gets treated equally in court.

What the gentlewoman from Texas (Ms. Jackson-Lee) is trying to do is to say for certain types of corporations, they would be treated under a different law than other types of corporations. That poses some really profound problems as far as I am concerned.

The crux of this whole matter is that this is an attempt to establish tax policy in a civil litigation procedure bill. It mixes up apples and oranges. It is not going to have the effect that the gentlewoman from Texas (Ms. Jackson-Lee) is stating, and that is preventing corporations that wish to go offshore from going offshore. The amendment is not wrong, it just does not make any sense. It should be rejected.

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I claim the time in opposition to the amendment.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, the gentlewoman from California (Ms. Lofgren) has spent a lot of time referring to suits by local district attorneys being removed to Federal court under this bill because she believes they would not be covered by the exemption contained in the bill for State attorney generals.

I would say to the gentlewoman that we believe that suits by local elected district attorneys do fall within that exempted category, and are not covered by the bill. It is clearly the intent of the bill to exclude elected law enforcement officials like district attorneys.

If we need to work further with the gentlewoman from California (Ms. Lofgren) as this bill moves forward to clarify that intent with regard to suits by local officials, I would offer her to do that. However, I do want to make it quite clear that private attorney general actions are another matter. If the gentlewoman will withdraw her amendment, we can work on clarification of this. Otherwise, I would urge the membership to vote against the amendment since the gentlewoman has rejected my offer.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself the balance of my time.

Mr. Chairman, I really regret that the gentlewoman from California was not interested in the compromise and clarification that I proposed, where we would allow elected district attorneys to continue to utilize the State court, but not private citizens with private attorney general actions which are authorized only in California and no place else. One of these private attorney general actions should not set national legal and economic policy. When you have an elected official like a district attorney or a State attorney general, that is one thing, because these people represent the public and it is their job to do this. When you have a private citizen in a procedure that has not been adopted by 49 out of the 50 States, they should not get a carve-out under this bill. Because there was no compromise that was agreed to, I would urge the rejection of this amendment.

Mr. Chairman, I yield back the balance of my time.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, this substitute amendment, I think, can probably be called the Madison County, Illinois, Judicial Protection Act of 2003, because what it does is it goes on for a long, long text, preserving essentially the status quo, and then throws a million dollars a year in for the next 2 fiscal years to have some kind of a study.

The most important sentence in the Sandlin amendment that demonstrates the author's true intent is tucked away in the middle of the legislation toward the top of page 8. For those Members who missed it, let me read this sentence to them: ``No pending class action may be consolidated without the approval of the State court judge handling the pending action.''

Let me tell my colleagues what this means. If you are a magnet State court judge and you want to keep running your class action factory, this bill will not affect you, because you do not approve any consolidation. You can continue to certify class action cases without considering the rules. You can continue to approve settlements, even if they do nothing for class members, even coupons. And you can continue to support the trial lawyers who got you elected to the bench.

It claims to offer better consumer provisions; but those provisions only apply to Federal court cases, of which there will be very few, if any, if this substitute is adopted. It is just a piece of paper for consumer protections. It claims to offer a proposal for consolidating State court class actions, but even if that proposal were constitutional, which it is not, it is completely discretionary. It claims to offer a proposal for transferring cases to Federal court, but it lets the State court judge where the suit was brought decide whether to take advantage of this procedure. This amendment is not worth the paper it is printed on.

The gentleman from Texas has given a few examples, and I think they came from a document that was originally circulated by the American Trial Lawyers Association. Let me respond to three of the examples he gave to show Members how much his bill misses the mark and ours addresses the problem. The Dow Chemical case he cited filed by Michigan residents alleging contamination at a Michigan plant likewise would not be affected by this bill. Because Dow and the proposed class members were all Michigan citizens, under our bill that suit would remain in State court.

The Tri-State Crematory cases actually present a perfect example of the benefits of our bill. Many Federal and State class actions have been filed in that matter. The Federal cases were consolidated in a multidistrict litigation proceeding where a Federal judge certified a class action in advance of any State court doing so. Finally, the TRG Marketing case, which is scattered amongst a number of State courts that are duplicating each other's work. Under our bill, all such cases would be removed to Federal court and handled by a single Federal judge. There is no reason to believe that consumers would fare worse under that scenario. Actually, under the substitute, duplicative litigation would end up being allowed, and the lawyers' meters are ticking. Studies show that State courts are much more likely to produce bad settlements, money for lawyers and no relief for consumers. And the Federal court would not be slower. Florida State court judges are each assigned four times the number of new cases annually than each Florida Federal court judge.

This amendment in the nature of a substitute is having the fox watch the hen house. The foxes are the plaintiffs' lawyers. They are the ones that the USA Today poll believes benefit disproportionately under this bill. It is time to send the fox packing. Defeat the substitute, pass the bill and the fox can go back to the woods.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself 1 minute.

Mr. Chairman, I would like to commend my friend from Maryland and my friend from Texas for being very consistent on the issue of retroactivity. Retroactivity is in here to prevent a race to the courthouse to avoid the new rules that are contained in this bill, should it be enacted into law. But, then again, they were against the retroactive tax cut. The tax cut that was enacted into law just a little while ago is retroactive to the first of January and, as a result of that retroactivity, there is going to be a reduction in withholding rates beginning the first of July that would be twice the amount if it were not retroactive.

So I guess they are against providing benefits of good legislation retroactively to anybody, because they are against good legislation.

Mr. Chairman, I yield the balance of my time to the gentleman from Virginia (Mr. Goodlatte).

Mr. Speaker, I rise in opposition to the motion to recommit.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I think it is unfortunate that the gentleman from New York (Mr. Weiner) did not spend more time talking about his motion to recommit. And I can understand why he did not do it. Because it opens up two big loopholes in this bill to allow the minority of the bar that abused the class action laws to continue to be on the gravy train.

I will tell you how he proposes to do it. First of all, he changes the effective date of the bill. What the bill says is that any class action where the class has not been certified will go under the new rules.

The motion to recommit changes that. It says that the new rules become effective as of the date of enactment of the bill. And this will result in a rush to the courthouse in Madison County, Illinois and the other class action mills to get cases filed so that they will be exempt from the modest civil action court reforms that are contained in H.R. 1115.

Now, the other red herring that is in this motion to recommit is that it takes away the so-called interlocutory appeal. This has nothing to do with Enron or WorldCom or any other firm or individual that is in bankruptcy. They are already in the Federal bankruptcy court, and all civil litigation against them in State or Federal courts is stayed and the bankruptcy court decides those claims. But interlocutory appeals are not the bad things that we hear from the gentleman from New York (Mr. Weiner).

The average time to decide an appeal for all types of cases nationwide is 10.7 months. The average time for a merits ruling and class certification appeals in the Seventh Circuit, which includes Illinois, is only 3.2 months. So you are not talking about having justice be unduly delayed. These appeals are decided promptly, even in a very busy circuit. This motion is a red herring. It should be defeated.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, on that I demand the yeas and nays.

Mr. President, I thank the ranking Democrat in the Senate Judiciary Committee, Senator Leahy, as well as Senator Reid of Nevada, for coming to the floor today to discuss the agenda of Congress. It is worthy of reflection.

Some of us went home last week after the vote dispirited because this administration was afraid to offer the Iraq reconstruction package as an up-or-down vote. They believed--and I think they were right--they couldn't pass it. So many Members of Congress had so many questions and reservations, the only way it could pass was to combine it with the money for our troops. Many of us, looking at this terrible Faustian bargain, had to vote for the bill to support the troops, believing that, frankly, if it were my child, someone near or dear to my family, as it is for so many people in Illinois, I wouldn't want to shortchange the troops one penny. So we ended up passing about $15 or $16 billion in reconstruction for Iraq.

Trust me, stories are already pouring in about some of the questionable contracting that is going on over there. There is real doubt among some as to whether this money will achieve the goal we are seeking. We want peace in Iraq. We want stability. We want our troops to come home. But we want to do it in the right way.

So far, this administration, since the declaration of the military victory, has seen a long string of embarrassments and defeats and setbacks. There have been pretty pictures painted by some on the other side who have gone there, but they can't overcome the reality of every morning's newscast which tells about another soldier being killed or another 10 soldiers being maimed.

I have visited with some of those soldiers who have returned from Iraq. Their lives will never be the same. To say they got by because they were simply wounded is to overlook the obvious. Many of them will carry scars for the rest of their lives because of a policy of this administration which, frankly, has not stood the test of time.

The reason I think it is important to reflect on that is to consider where we are today. Now that we have moved from the issue of Iraq, we are back on an issue which is near and dear to the Republican leadership in Congress as well as to the White House. Take a look at the agenda of this Congress and particularly what we are discussing today. It is an agenda which attempts to slow down the legitimate responsibilities of government directly through Executive orders and indirectly with historic deficits.

Yes, this fiscal conservative, compassionate Republican President has stood by and watched as we have reached record depths in terms of debt in America. Although he can point to a recession which he blames on the previous President, which is fair game in Washington, he can point to a war on terrorism, the fact is, most of this deficit is his own creation.

President Bush's tax policy, his economic plan has been a failure for America's economy. But it has been a dramatic success for those who were praying for a bigger deficit. I don't know who that might be, but if you were looking for a President to deliver the biggest deficit in the history of the United States, this President has done it. That deficit, of course, shortchanges us when we need to really pursue the valuable and vital functions of government.

There are some things which only government can do. I know my friends from the conservative side of the political spectrum hate to concede this point, but there are certain things only government can do. Certainly military defense is one. Defense against terrorism is another. But there are others, and they will come to our attention as we consider the debate before us on a bill related to class action lawsuits.

The agenda of the Republicans in Congress and the President is one that is guided by the naive belief that the balance of power within our Government is outdated. It is an agenda which would close the courthouse doors to ordinary Americans in the name of penalizing trial lawyers but continue to protect the most politically powerful. This is nothing new in government. The people who have the power to line the Halls of Congress with their lobbyists in their three-piece suits and fancy shoes are well represented. They are the voices you hear when you come to vote for a bill.

The voices that are not heard are those of consumers and families and working people who are disadvantaged time and again by these special interests. The Class Action Fairness Act is a special interest piece of legislation designed exclusively to protect those who are wealthy and powerful from even being held accountable in court.

When you look at the options available to us, if you have a President who really doesn't care to work for consumers and working families, and a Government which is unresponsive because of that President or the lack of funds, and a Congress unwilling to address these same issues, there is only one place for an American to turn. That is the court system. So what this Congress tries to do time and time again is to close the doors of the courthouse so that that family, that consumer, that small business, that individual doesn't have a chance to go into the courthouse and ask for justice. They are doing that with this class action bill.

Whether the agenda is driven by the White House, the leadership of the House of Representatives, the committees on the floor of the Senate, the not

so invisible hand of the right-wing agenda is busily at work. We see it in the nominees sent up for lifetime appointments to the Federal judiciary, men and women who are not even close to the center stripe of political thinking, in the hopes that if you cannot close the courthouse door, make sure there is a judge on the bench who will rule consistently on behalf of the wealthy and powerful in America.

Some will say what I am saying sounds a lot like class warfare. I can recall what Warren Buffet, one of the wealthiest men in America, told us a few weeks ago. He came to a luncheon on Capitol Hill and spoke to a group of Senators and talked about President Bush's tax cuts for the wealthy. This wealthy man from Omaha, NE, said, ``Some people say this is class warfare.'' He said, ``I want to tell you something. It is true, and my class is winning the war.''

That is a fact. They have won the war with the President's tax cuts. They will continue to win the war when it comes to closing the courthouse doors. The agenda is being driven by President Bush and his gang of compassionate conservatives. It is not just this issue of litigation and tort reform. It stretches in so many directions. This is an administration that wants to drill for oil in the Arctic National Wildlife Refuge rather than to demand that automobile manufacturers in Detroit make more fuel-efficient cars, which they can do. The technology is available. But this administration would much rather invade a pristine wildlife refuge set aside by President Eisenhower 50 years ago than pick up the phone and say to the Big Three in Detroit that you have to do better. We need more fuel-efficient cars and we are going to support legislation to make it happen.

That shows you where they are coming from. They would much rather drill in a wildlife refuge than to ask for more fuel efficiency from the automobile manufacturers. This is an administration that cuts education funding for schoolchildren to pay for tax benefits for the wealthiest people in America. It is an administration that would restrict background checks on gun purchasers while protecting gun manufacturers from liabilities. Rather than to make certain that we keep guns out of the hands of people with criminal records or a history of mental illness, they say instead, in the name of a second amendment, we cannot ask those questions and, if we do, we cannot keep the records long enough for law enforcement to use them. It is a constitutional right as far as they are concerned under the second amendment.

Yet when it comes to gun manufacturers making defective products and dangerous products and selling them, this administration falls over backward in an effort to protect them from any liability in court, this administration which would cap the compensation of injured victims of medical negligence, medical malpractice, and never question the insurance companies that continually make mistakes and charge the most outrageous premiums. Now we are forced to debate a bill that divides instead of unifies us.

It is especially troubling at a time when so many appropriations bills have not even been considered in the Senate and we are going to work on this bill for special interest groups. The majority leader brought this bill before us instead of an appropriations bill. Here we are after October 1, at a time when we should have passed all of our appropriations bills, but instead of addressing the immediate needs of Government, we are going to address the immediate needs of the special interest groups.

I find it interesting that the bill before us is not the bill that passed the Judiciary Committee, which I served on a little earlier this year. There is a provision back in the bill called a mass tort provision. I will not go into all the details of it other than to tell you the special interests have won again. There was a bipartisan motion in the Judiciary Committee--I am not sure there was debate--to delete a section of the bill for so-called mass tort actions. It was a motion by Senator Specter, a Republican, and Senator Feinstein, a Democrat. It was removed without controversy.

Guess what happened. That bill was thrown away. The bill before us today reinstates this prohibition against mass tort actions. That is fundamentally unfair, and we knew that. The special interest groups prevailed again.

How fair is the Class Action Fairness Act before us? It is not about fairness or justice. It is about protecting the powerful against legal challenges from the little guy. Who wants this bill? Who wants this class action bill? I will tell you those who line up on the side of this bill. It is the major tobacco companies, including Philip Morris, which is sick and tired of being sued by those who have been damaged by their deadly tobacco products. They have come to the Republican Congress and prevailed on them to make it more difficult for the victims of those tobacco products to come to court. So the tobacco companies want this bill to pass. Gun manufacturers, understanding their exposure to liability by selling defective guns, selling them in quantities where they knew or should have known they would fall in the hands of criminals, don't want to be sued in court anymore. Even though the death rate in America--on the streets of Chicago, New York, and Washington--continues to climb from gun murders, this bill says the victims are going to have a tougher time suing the gun manufacturers.

Those who pollute want this bill. Those involved in environmental pollution are less likely to be sued because of this bill.

Others include the pharmaceutical companies, every insurance company in America that I know of, the National Association of Manufacturers, and Financial Services Roundtable. The list of special interest groups is very lengthy.

There is another group on the other side who oppose this bill--an interesting coalition. Listen to those who have come out in opposition to the bill. The first name on the list may be the most curious. It is Chief Justice of the U.S. Supreme Court, William Rehnquist. Why? Because this bill shifts a lot of class action lawsuits from State courts to Federal courts. Chief Justice Rehnquist understands that the Federal courts are not in a position to deal with these lawsuits. He said this is a bad bill; it is bad for the administration of justice in America. He is not a bleeding heart when it comes to consumer cases. His precedents and rulings will speak for themselves. But he says this bill is bad, and he is right.

Then the list of organizations--which I will not read--is two pages long. These groups are a clear indication of why it should not be passed. I will say generically that many of the leading medical groups, including the American Cancer Society, the Heart and Lung Society, many leading environmental groups in America, and almost every one of the major consumer groups in America, say this is a bad bill. It will keep ordinary Americans from having their day in court.

I ask unanimous consent that the list be printed in the Record.

National Organizations Opposed to Federal Class Action Legislation

This is a classic battle between the biggest companies in America, that don't want to face legal responsibilities, and the most vulnerable people in America, who have no other recourse but the courts. Consumers, environmentalists, gun control advocates, and civil rights champions often turn to the class action process of our civil justice system because the Government--beholden to the special interest groups and the corporate agenda--simply is unwilling to take on these same big corporations.

Unfortunately, when you pit these two sides together on Capitol Hill, consumers don't have a chance. This bill is a clear indication of that.

The bill is fundamentally unfair and unnecessary. How can you be sure it is only the plaintiffs who are guilty of abusing forum shopping but never the defendant? That is the argument being made. They say we have to restrict the people who can bring lawsuits in court.

The argument on the other side is that there are so many frivolous lawsuits. The honest answer is that there are some frivolous lawsuits, and there always will be in a system open for any individual to file a lawsuit. On the other hand, we know many of these lawsuits--and I will recount several later on--give clear indications and evidence of the fact that many people who are sued in class action lawsuits have a real responsibility to the consumers and the American people that they don't meet.

I am concerned when they tell me the bill will restrict their ability to fight for rights of consumers and victims of corporate malfeasance, and I hope the sponsors can carry their burden in explaining to the American people why they believe this bill will not tilt the advantage to the corporate defendants.

To the extent there are abuses in the class action process, it should be addressed with a scalpel, not a sledgehammer, which this bill does. If the problem is concentrated only in a handful of State courts, the solution isn't to remove every case to Federal court. That is what this bill does.

The American Tort Reform Association, which represents all of the special interest groups that would close the courthouse doors, obviously championed this bill. They released a study recently which I find amazing and, in a way, offensive.

In their report, entitled, ``Bringing Justice to Judicial Hellholes 2002,'' this organization identified 13 counties or cities that they define as ``judicial hellholes,'' because they supposedly attract lawsuits from around the Nation to plaintiff-friendly courts.

What does that mean? If you are a lawyer in some part of the country and want to file a class action suit, this association argues that you can shop around to find the friendliest judges who will certify your class. That is the first step in a class action suit. The court has to basically certify under State law whether you can gather together the individuals you call your ``plaintiffs' class'' to sue a defendant. They argue that in some parts of America it is more likely to be certified than not. They characterize those as judicial hellholes. One of them is near and dear to me because it is in my home State, in Madison County, IL. I was born in St. Clair County, the adjoining county. I am familiar with Madison County and most of the people who practice law there and the judges on the bench.

Well, with all of their valiant and well-funded national research, the American Tort Reform Association came up with about a dozen ``hellhole'' counties, and a few more they call ``honorable mentions.''

That is about a total of 20 counties they have identified out of over 3,000 counties in the United States and more than 18,000 cities, villages, and towns--20 problem counties out of 21,000 cities and counties. That is fewer than .0001 percent of all the counties and cities in the country.

Clearly, if that is where the problem lies, with 20 places, why would we pass Federal legislation to affect every county and every city in America? Yet the solution the sponsors seek is exactly that.

Let me speak for a moment about the real story of Madison County because it has been recounted over and over by the advocates of tort reform as an outrageous, out-of-control situation.

It is said there have been hundreds of consumer class action cases filed in the last few years and rarely are any not certified for trial. That is what the American Tort Reform Association says. Yet while the number of filings increased, the number of consumer class action certifications in that county has actually declined over the last 2 years.

State judges, including those in Madison County, are disposing of frivolous consumer class action cases by refusing to certify them for trial. Moving them to Federal court simply transfers the responsibility for making that determination.

Let me give some numbers so we can get a feel for one of these judicial ``hellholes'' from the groups that advocate this legislation.

Madison County, IL: Consumer class actions filed--1999, 12; 2000, 39; 2001, 60; 2002, 76; 2003, 44 as of July 2.

Let's go back for each of those years and find out how many were actually certified to go forward and be tried. In 1999, 12 were filed, 6 were certified; in 2000, 39 filed, 14 certified; in 2001, 60 filed, 2 certified; in 2002, 76 filed, 1 certified; in 2003 so far, 44 filed, none certified.

Does this sound like a situation out of control? The sum total of all the class action lawsuits for these 5 years so far is 23 over 5 years-- 23 class action lawsuits in Madison County, IL, the so-called judicial ``hellhole.'' Frankly, the arguments made on the floor just are not borne by the facts.

Additionally, of 166 verdicts that were reached in all cases filed in Madison County, 55 resulted in no monetary verdicts to plaintiffs. Only 11 verdicts in the 166 cases tried resulted in verdicts in excess of $1 million. The median verdict for all cases in Madison County, IL, is $28,649.

If there are problems in any jurisdiction or any State, they can be solved there. In Alabama, for example, one of the favorite targets for criticism by tort reformers, the State supreme court reprimanded a few State judges who had certified numerous classes.

In Mississippi, another jurisdiction frequently mentioned by supporters of class action reform, the State legislature recently repealed Mississippi's venue and joinder statutes, making it more difficult to bring mass tort claims.

Removing these cases to Federal court does not solve the problem. In fact, it is going to heap more of a burden and demand for more specialization and responsibility on our Federal courts, many of which are already overburdened.

I see my colleagues are on the floor. I am going to take a few minutes to point out the kinds of lawsuits about which we are talking.

When the average person hears ``class action lawsuit,'' they may not have an idea of what it is about. I would like to give a few examples of class action lawsuits and understand, I hope, for a moment that those who are coming to the floor trying to restrict the rights of plaintiffs to come into a class and file

a lawsuit have to face the reality of the history of class action legislation. We will find in these cases some recurring themes, but the most recurring theme is this:

The plaintiffs in a class action lawsuit were usually damaged a very slight amount or in a very limited way individually or as families, but when you take together the sum total of all the damage done by the defendant, it becomes substantial. If someone--Senator Leahy used this example in committee--if someone overcharges a person 2 cents a gallon for gasoline so that each time they fill up they lose 40 cents, there is not a great loss to an individual. But when you put that together in terms of the millions of people buying gasoline, one can understand that if the defendant corporation has been guilty of fraud or wrong dealing, they have made millions of dollars at the expense of 40 cents a fill-up of individual consumers. So class action lawsuits bring all these consumers in one group against a corporation that may have harmed them only a slight amount individually.

Let me give some examples. Foodmaker, Inc., the parent company of Jack-in-the-Box restaurants, agreed to pay $14 million in a class action settlement in the State of Washington. The class included 500 people, mostly children, who became sick in early 1993 after eating undercooked hamburgers tainted with E. coli. The victims suffered from a wide range of illnesses, from more benign sicknesses to those that required kidney dialysis. Three children died. The settlement was approved in 1996. So 500 individual families, instead of suing Jack-in- the-Box and its parent company Foodmaker, came together as a class because that corporation was selling products so tainted and adulterated that it led to death and serious illness--500 people, $14 million, but deaths were involved in the process.

Let me give another example. General Chemical of Richmond, CA. On July 26, 1993, the chemical oleum, a sulfuric acid compound, leaked from a railroad tank car. The leak caused a cloud to spread directly over North Richmond, CA, a heavily populated community. Over 24,000 people sought medical treatment because of that leak. General Chemical entered into a $180 million settlement with 60,000 northern California residents who were injured and sought treatment for the effects of that pollution. Individual plaintiffs received up to $3,500.

What is the likelihood that if you personally or a member of your family ended up going to a hospital or a doctor and had $500 or $600 or $1,000 in medical bills that you would turn around and hire a lawyer and sue General Chemical responsible for that illness in your family? I don't think the likelihood is very strong. But when they brought together the 60,000 people who were damaged because of this environmental leak of a sulfuric acid compound, the company agreed to pay $180 million to some 60,000 people.

Let me give another example. Beech-Nut Corporation, and its parent company Nestle, were accused of deceptive business practices, guilty of selling--listen to this--Beech-Nut and Nestle were found guilty of selling sugar water labeled as pure apple juice for infants. After passing blame back and forth between companies and suppliers, they eventually agreed to settlements of $3.5 million to reimburse consumers who unknowingly fed their babies sugar water instead of apple juice. Is that the kind of thing that merits a lawsuit? In an individual situation you may ask, How sick is the baby?

The bottom line is, these companies were trying to make money by deceiving parents into believing they were selling a nutritious product and ended up paying $3.5 million because of it.

Class action lawsuits by consumers who as individuals would never have a day in court, but coming together finally found justice in their State courts, a justice which is threatened by the so-called class action fairness bill which is before us today.

There was a class action lawsuit brought against Ford Motor Company for defective ignition systems in millions of cars that stalled on highways, and Mobile Corporation paid a $14 million settlement because of a class of residents in New Orleans who, after a fire at a Mobile Oil refinery and scattered debris sent volatile and hazardous compounds in the air, were forced to evacuate. The settlement was $13.4 million to those exposed to this pollution from the Mobil Oil refinery.

It was a class action lawsuit against a corporate giant. How many of those individual families would stand together seeking justice? In this case, they did stand together successfully. Individually would they have gone to court? Highly unlikely.

Blue Cross and Blue Shield of Iowa paid a $14.6 million settlement in three class action lawsuits because of fraudulent billing practices. Blue Cross apparently negotiated secret discounts with hospital and providers and failed to pass those along to those who should have received them--their customers. The list goes on and on.

I see several of my colleagues on the floor. I will close and say I am sure we are going to return to this issue in a short time. I ask my colleagues in the Senate who may not have practiced law, who may not be familiar with class action lawsuits to please do the following: Read these cases. Understand class action lawsuits are not always frivolous ideas.

I can recall some that were. There was a lawsuit brought by a class, not certified, for all the people who bought Milli Vanilli records, and then came later to learn that those two people were not even singing on the records. To me, that is a joke, a bad one. It is a fraud on the public but certainly not deserving of a class action suit.

How can one compare that to companies that sell tainted and adulterated food, to companies that deceive parents about the nutritious value of the foods they sell, or companies that are engaged in pollution that endangers the lives of individuals? Those companies need to be held accountable.

This bill tries to absolve them from liability, to move the cases to Federal court, to make it more difficult to push the classes together, and make it more difficult to recover. These are real live stories of ordinary families and people who will ultimately lose if this bill passes.

I hope the Senate has the good sense to stop this in its tracks, stand up for consumers and working families who need a voice in this Chamber even if they cannot afford a lobbyist in the hallway.

I yield the floor.

Mr. President, I note that Senator Cornyn is here. I ask unanimous consent he be permitted to

speak, and then I be granted the floor thereafter.

Mr. President, I ask unanimous consent that Senator Breaux be recognized and then I be recognized immediately following his remarks.

Mr. President, I thank my colleague for his kind remarks. We will certainly look at whatever he has to offer in this matter. We will keep an open mind and see if we can get together.

I rise in strong support of S. 1751, Class Action Fairness Act of 2003. It used to be S. 274, but now it is renumbered to S. 1751. This bill represents a carefully balanced legislative solution in response to the widespread abuse of the class action lawsuits in our State courts. Over the past decade, it has become painfully obvious that class action abuses have reached epidemic proportions. What began as occasional outrageous class action settlements, drawing light humor, has now become a routine occurrence that is just not funny anymore. It has become equally clear that the true victims of this epidemic have been every-day consumers who represent the silent majority of unnamed class members throughout the country.

It has become too common where plaintiff class members are not adequately informed of their rights or the terms and practical implications of a proposed class action settlement. Making matters worse, judges too often approve settlements that primarily benefit class counsel, the attorneys, rather than the class members or the victims. That is turning the law on its head.

In the coming days, we will hear numerous examples of egregious State court settlements, where class members habitually receive little or nothing of value, while their attorneys receive millions of dollars in fees. The cases are numerous, but just too extensive to list.

To put these settlements in perspective, allow me to share a recent class action settlement that one of my own staff members recently actually received in the mail. This settlement notice comes from a State court in Jefferson County, TX. It involves the settlement of a class action lawsuit brought on behalf of purchasers of Bridgestone and Firestone tires. This technical legal document informs my staffer--an apparent class member by virtue of owning a set of Firestone tires--of a proposed class action lawsuit settlement that will award the lawyers $19 million in fees and costs. That is not a bad payday for lawyers when compared to what the clients get: a promise from defendants that they will make safer tires and initiate a safety program.

It strikes me these class members are getting a so-called benefit they should be getting, anyway. It seems to me they should try to have safer tires and the benefit of a safety program.

But the laughable settlement terms don't end there. Unlike the unnamed class members who do not stand to gain a single penny, those lucky enough to be named plaintiffs get to walk away with a $2,500 cash bounty. This proposed settlement, which will likely be approved by the State court, represents everything wrong with the class action system today and underscores the importance of reform--$19 million, where no one really gets any benefits except a few they choose to be named plaintiffs, who get $2,500. The attorneys walk off wealthy, happy, fat, and laughing.

The need to reform our class action system is not a new issue to the Senate. The Judiciary Committee conducted hearings in the 105th, 106th, and 107th Congresses, reporting a similar bill out of committee in the 106th Congress on a bipartisan basis. We have received mountains of evidence demonstrating the drastically increasing injustices caused by class action abuses.

After working extensively with numerous legislative proposals throughout the various Congresses, the committee reported a bill--again with bipartisan support--which I believe provides a measured response to the underlying class action problem.

This being said, I would not be surprised to hear somebody deny the existence of any problem at all. Others will try to confuse the issue with dubious claims that proposed reforms would somehow disadvantage victims with legitimate claims or further worsen class action abuses. Others may even contend past legislative reforms have contributed to recent financial debacles and that the proposed reforms will encourage more. Rest assured, Mr. President, such claims are nothing more than red herrings intended to divert the debate from the real issues.

In this regard, let me emphasize a few points regarding this bill. First, this bill doesn't eliminate all State court class action litigation. Class action suits brought in State courts have proven in many contexts to be an effective and desirable tool for protecting consumer interests and rights. Nor do the reforms we will discuss today in any way diminish the rights or practical ability of victims to band together to pursue claims against large corporations. In fact, we have included several consumer protection provisions in our legislation that I believe will substantially improve plaintiffs' chances of achieving a fair result in any settlement proposal.

There are three key components to our legislation. First, the bill implements consumer protections against abusive settlements by:

No. 1, requiring simplified notices that explain to class members the terms of proposed class action settlements and their rights with respect to the proposed settlement in ``plain English.''

No. 2, enhancing judicial scrutiny of the abhorrent coupon settlements.

No. 3, providing a standard for judicial approval of settlements that would result in a net monetary loss to plaintiffs.

No. 4, prohibiting bounties to class representatives.

No. 5, prohibiting settlements that favor class members based upon geographic proximity to the courthouse.

And No. 6, requiring notice of class action settlements be sent to appropriate State and Federal authorities to provide them with sufficient information to determine whether the settlement is in the best interest of the citizens they represent.

Second, the bill corrects a flaw in the current diversity jurisdiction statute that now prevents most interstate class actions from being adjudicated in Federal courts. Specifically, the Class Action Fairness Act amends the diversity-of-citizenship jurisdiction statute to allow larger interstate class actions to be adjudicated in Federal court by granting original jurisdiction in class actions where there is ``minimal diversity'' and the aggregate amount in controversy among all class members exceeds $5 million.

The bill balances the State's interest in local disputes by providing that class actions filed in the home State of the primary defendants would remain in State court subject to a triple-tiered formula that looks at the composition of the plaintiffs' class membership. This formula has become known as the Feinstein Compromise.

To enforce the jurisdictional changes, the bill modifies the Federal removal statutes to ensure that qualifying interstate class actions initially brought in State courts may be heard by Federal courts if any of the real parties in interest so desire.

Although some critics have argued this amendment to diversity jurisdiction somehow violates the principles of federalism or is inconsistent with the Constitution, I think their concerns miss wide of their mark. I fully agree with Mr. Walter Dellinger, former Solicitor General, who previously testified at one of our Judiciary Committee hearings that it is ``difficult to understand any objection to the goal of bringing to the Federal court cases of genuine national importance that fall clearly within the jurisdiction conferred on those courts by article III of the Constitution.''

Finally, I wish to express my appreciation to the many individuals who have shared with me the details of their experiences of class action litigation. In particular, I am grateful to those victims of various abuses of the current system who have come forward and told their stories in the hope that something positive might come out of their terrible experiences.

Among those who have come forward is Irene Taylor of Tyler, TX, who was bilked out of approximately $20,000 in a telemarketing scam that defrauded senior citizens out of more than $200 million. In a class action brought in Madison County, IL, a notorious county for these cases, a forum shop county where attorneys forum shop to get these big verdicts and these favorable court rulings, the attorneys purportedly representing Mrs. Taylor negotiated a proposed settlement which will exclude her from any recovery whatsoever.

Martha Preston of Baraboo, WI, provides another excellent example. Ms. Preston was involved in the famous BancBoston case brought in Alabama State court which involved the bank's alleged failure to post interest to mortgage escrow accounts in a prompt manner.

Although Ms. Preston received a settlement of about $4, approximately $95 was deducted from her account to help pay the class action counsel's legal fees of $8.5 million. Notably, Ms. Preston testified before my committee 5 years ago asking us to stop these abusive class action lawsuits, but it appears that at least thus far her plea has not been heard. So I urge my colleagues to support this modest effort to reform the abuses in the current system, abuses that are actually hurting those the system is supposed to help.

Mr. President, I wish to take a minute or two with some charts to show how bad the system is. Under current law, in many State class action lawsuits, all of the money--every stinkin' dime--goes to the attorneys. I am not against attorneys. I am one myself. I think they deserve to be paid reasonable fees, but in these class action suits every bit of the money goes to attorneys.

In the BancBoston case, lawyers got $8.5 million. In the case I just mentioned, some of the plaintiffs had to pay the attorneys additional moneys, getting nothing out of it, but the attorneys got $8.5 million.

I don't know, but that just smells to me a little bit. Maybe I am just too critical, but when the attorneys who represent the clients get $8.5 million and the clients have to again pay the attorneys even more, there is something wrong with that.

Take the second one, the Blockbuster case. The lawyers got $9.25 million. What did the plaintiffs get? One dollar off their next movie. Come on. Doesn't that seem a little disproportionate to you, $9.25 million for attorneys and $1 for the client? Now, true, there are many clients, but it doesn't seem too right to me.

Take the frequent flier case. The lawyers got $25 million. The plaintiffs got a coupon worth $25 to $75. Again, now I understand in that particular case--I may have it mixed up with another case--after getting a huge settlement, they then turned around and sued the plaintiffs for more money.

Take the Coca Cola sweetener case. The lawyers got $1.5 million and the plaintiffs get a 50-cent, a 50-penny coupon. I don't know about you, but that also smells to me. Again, I am not against attorneys getting reasonable fees, but it seems to me these are scams more than anything else. They will say they are correcting societal wrongs, but why then do they get all the money and the plaintiffs who have to put their names on the line get relatively nothing? Talk about class action abuse.

Let's go to that Blockbuster Video case. After being named in 23 class action lawsuits, Blockbuster agreed to provide class members with only $1-off coupons, ``buy one get one free'' coupons, and free Blockbuster favorites video rentals . . . while attorneys are reported to receive around $9.2 million in fees. That is according to the RockyMountainNews.com. It just does not seem right. But that is the way it is.

The class action abuse I mentioned in the BancBoston settlement over disputed accounting practices produced $8.5 million in attorneys fees and actually cost class members around $80 each. Later plaintiffs' attorneys in this case also sued the class members--the individuals who they brought the suit for--they sued them for an additional $25 million. There is something wrong with that. I don't care what anybody says.

Take this one. This is a class action abuse, something this bill would correct. There was a settlement with Cheerios over food additives that produced $2 million in attorneys fees while class members only received coupons for more Cheerios, something they complained about to begin with. I happen to like Cheerios. I have nothing against Cheerios. I eat them. But why would attorneys get $2 million while class members get a coupon for another box of Cheerios? It does not seem right to me.

As my colleagues can see, this is a policy that is being abused, and we are only mentioning a few of the abuses. I have no problems with legitimate, honest class action suits where attorneys are acting in the best interests of their clients. But I do have problems with some of these phony approaches that it seems to me are blatantly wrong on their face, where the attorneys get huge fees and the class members get virtually nothing. That is what is happening in these particular cases.

This bill will correct some of those ills without taking away the right to pursue class actions, and in certain cases they will have to be pursued in Federal court. I remember when I practiced law--that was a long time ago, before I became a Senator--we would die to get into Federal court because everybody knew it was a more important case, that the Federal courts handle more important cases, people thought, and still do think that.

For some reason, these class action lawyers do not want to go to Federal courts. Now, why is that? Because they can forum shop into Madison County, IL, where they get judges and jurors to hammer the defendants with outrageous verdicts that benefit basically only the attorneys. Now, that is wrong.

There are at least five States in this Nation where they forum shop class action cases. Grisham wrote a book about this. He is a great storyteller, but I can almost name every fictionalized attorney in that book.

Some of them are great lawyers. Some of them are leaders in bringing litigation to correct societal wrongs. Some of them deserve credit for doing that. But this is a system that is out of control. This bill will help to straighten it out, and I think resuscitate the respect for my profession because attorneys who bring these actions will have to do so pursuant to fairness and rules that make sense rather than forum shop to areas where they can get big verdicts and big legal fees but do injustice.

Now I will speak about ``Let's Play Class Action Monopoly.'' Go. Come up with an idea for a lawsuit, it states on the top of the board. Find a plaintiff to pay off, or a set of plaintiffs. Make allegations. You do not need any proof to make allegations. Get out of rule 23 free. So you get out of the rule. Convince your magnet State court judge to certify the class, which is also another scam in some of these jurisdictions where the judges do not seem to appreciate the law or abide by the law.

File copycat lawsuits in State courts all over the country. Sue as many companies in as many States as possible even if they have no connection to the State.

It states in the bottom right: Who gets the money? Go left on the bottom. Columbia House case, $5 million for lawyers, discount coupons for plaintiffs; Blockbuster case, $9.25 million for lawyers, free movie coupons for plaintiffs, and not too many of them; BancBoston case, $8.5 million for lawyers. Some plaintiffs pay more fees rather than get anything out of it.

So in the bottom left, what happens to me? Your employer takes a hit, maybe lays you off. Next one, your health and car insurance premiums go up. The lawyers win. You lose.

I have tried cases on both sides of the table. I started out as a defense lawyer, and I defended these types of cases. Then in the latter years of my practice, I became primarily a plaintiff's lawyer where I brought cases for and on behalf of individuals who were injured. I brought cases for injured people and got them big verdicts they deserved. They walked away with the bulk of the money, which is only right. Yes, they were happy to pay my fees because they always came out well.

In some of these cases, this is a scam. Now, there are legitimate class action cases, but there are many of them out there today that are not. It is a disgrace to our profession. This bill will clarify and straighten out some of the wrongs that are going on. It is high time we do this. The only reason we might not do it is because there is a filibuster on the motion to proceed. Normally, we never have a filibuster on a motion to proceed. Normally, we just go to the bill, and then if somebody wants to filibuster, they filibuster the bill, especially if they have the votes. Why not?

But a filibuster is happening even on the motion to proceed. Why is that? Why a filibuster to begin with, on something that really makes sense? Because there are trial lawyers in this country who pay big premiums. That is why they make a lot of this money, so they can pay big premium dollars to politicians who will vote for them no matter what the rules are.

I want to make it clear, not all class action lawyers are bad. Some of them do what is right, and they are not afraid to go to Federal court. They know they can get their big verdicts in Federal courts as well because they have cases where they should get verdicts. When we have these forum shop cases, something is wrong.

Why is it that we have to have a filibuster on the motion to proceed, or require a cloture vote on the motion to proceed to a bill? Why do they not just let us bring the bill up, and then if they want to filibuster, filibuster the bill? Because we are at the end of a session where every minute counts, every second counts, every hour counts, every day counts. By delaying, those who do not want this bill can help their trial lawyer friends who are very involved in the political process because they have millions of dollars that, in many cases, they do not deserve; that they can give for political purposes to keep these types of injustices going. That is why this bill is important. That is why there is a huge bipartisan vote for this bill.

The question is: Can we get 60 votes? I personally believe we can. I believe it would be a disgrace for this body to not overwhelmingly vote for this bill. It is a bipartisan bill. It has been well thought out. We have worked hard to accommodate various members on both sides of the aisle. I think it will redeem our profession from those fly-by-nights who are just in it for the money, without regard to helping their real clients.

I would like to see that happen because the law profession is a great profession, but in recent years it has been steadily eroded by people who are not doing what is right in the profession. These are just some egregious cases that are all too often happening because some lawyers do not do what is right.

I am for the good lawyers. But I am against those who are just in it for the money and not really helping their clients. This bill will not stop them from bringing litigation, but it will even up the situation so at least there will not be the same amount of forum shopping, and better, more honest judges will be deciding these cases along with better and more honest juries.

I suggest the absence of a quorum.

Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, welcome to ``Bash Trial Lawyers Day'' in the House of Representatives. My friend the chairman used the term 13 times in his presentation.

I just keep wondering, I would ask the gentleman from Wisconsin (Chairman Sensenbrenner), what kind of law did you practice? I am intrigued by the right of trial lawyers not to be as effective as they can in court.

I notice that the Enron people have pretty good trial lawyers. I notice that WorldCom has pretty good trial lawyers. I notice that Adelphia has pretty good trial lawyers. These are all Republican supporters. I notice that Tyco has pretty good trial lawyers.

Why cannot people with class action suits have trial lawyers that are effective and doing a good job and get compensated for it?

I would yield to the gentleman, if he chooses to comment on that.

I yield to the gentleman from Wisconsin.

Mr. Chairman, reclaiming my time, everybody has a right to a lawyer. I thank the gentleman very much. I am very happy this gets reiterated.

I just want to count the number of times trial lawyers get it in the neck. Property lawyers, they are okay. Domestic relation lawyers, have you got any beef about them? They are okay. But trial lawyers that try these kinds of class action cases, they are making out like bandits, so, let us put it in the Federal courts. Let us take all of the class action cases and send them to the Federal courts, exactly where the Federal judiciary is begging you not to send them; begging you not to send them. All the consumer groups are begging you not to send them there.

Yet you tried it in 1998, 1999, 2001, and, now for the fourth time in 6 years, you are back at it again.

Why? What is the problem, guys? Should not people, consumers injured, be able to bring their cases to their State courts where they have traditionally?

Well, the answer is, for me, yes; but for you, no.

Could somebody explain to me why we would make the cases retroactive on top of it? I yield the floor. Tell me why Tyco, Enron, WorldCom, Adelphia, just tell me why those five corporations should be granted a delay?

I yield with pleasure to the gentleman from Virginia, my friend on the Committee on the Judiciary.

Mr. Chairman, I take my time back. I thank the gentleman very much for his contribution.

What this bill does, and I just ask that you would read it, I will quote you the exact place in the bill, is grant an automatic right of appeal in class certification cases automatically. Is that going to expedite things?

Most of the judges do not even grant an appeal if they had the discretion, and think I think you or your staff may be aware of this. That is a delay, I would say to the gentleman from Virginia (Mr. Goodlatte).

Now, in addition to the automatic delay, there is a stay of all discovery proceedings while the right of appeal is exercised. Do you know how long that could take, I would ask the gentleman from Virginia (Mr. Goodlatte)? About 2 years. Now you are telling me that is really expediting the process. I wait to hear your explanation of that.

I rise in strong opposition to H.R. 1115. Although the legislation is described by its proponents as a simple procedural fix, in actuality it represents a major rewrite of the class action rules that would bar most forms of State class actions and massively tilt the playing field in favor of corporate defendants.

This is why the legislation is opposed by both the State and Federal judiciaries, consumer and public interest groups, environmental and health groups, and civil rights groups. There are several critical problems with the bill before us.

First, H.R. 1115 will have serious adverse impact on the ability of consumers and other harmed individuals to obtain compensation in cases involving widespread harm. At a minimum, the legislation will force most State class action claims into Federal courts where there will be far more victims to litigate cases and where defendants could force plaintiffs to travel long distances to attend proceedings. At worst, because it is so much more difficult to certify class actions at the Federal level, the bill will operate to terminate most class action entirely.

Second, the bill includes a whole series of unrelated provisions that have nothing to do with class action jurisdiction, but will serve to benefit corporate wrongdoers. For example, section 6 of the bill gives the defendant an absolute right to appeal preliminary court decisions, which will delay the case by up to 2

years. The section also stops the discovery process dead in its tracks while the appeal is pending.

Most outrageously of all, the bill was amended so that it applies retroactively to pending cases. This means that the bill would apply to pending in corporate fraud cases. As my hometown paper, the Detroit Free Press wrote yesterday, ``the House version of the legislation is particularly offensive because it is retroactive, meaning it would affect class action claims now pending against Enron, Worldcom, Adelphia and other corporations accused of defrauding investors while their executives made millions of dollars.'' Is there a single Member in this Chamber who could defend Congress intervening in a pending case to help these corporate scam artists?

Fourth, the bill federalizes far more than just class actions. Section 4 provides that private attorney general actions and mass tort actions are to be treated as class actions and removed to Federal court. This means that district attorneys will no longer be able to combat fraud and abuse in their own State courts, and groups of harmed tort victims will be forced out of their State courts as well.

Do not be fooled by the Boucher amendment, which proponents claim will incorporate the Feinstein language from the Senate. What they do not tell you is that unlike the Feinstein compromise, the Majority's bill applies retroactively, allows for two year delays or more, and knocks out private attorney general actions. None of these provisions were in the Feinstein amendment in the Senate.

I believe it is time for more corporate accountability, not less. I urge a no vote on this one-sided, anti-consumer legislation.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield myself 15 seconds.

Mr. Chairman, my distinguished friend, the gentleman from Virginia, forgot to put in Enron class action cases. I guess that was an oversight.

Mr. Chairman, I am pleased to yield 1 minute to the gentlewoman from Ohio (Mrs. Jones), a former prosecutor, judge, and attorney.

Mr. Chairman, I am pleased to yield 2\1/2\ minutes to the gentleman from New York (Mr. Weiner), a distinguished member of the committee.

Mr. Chairman, I yield 2 minutes to the gentleman from Massachusetts (Mr. Delahunt).

Mr. Chairman, I am happy to yield 3 minutes to the gentlewoman from California (Ms. Waters), a member of the Committee on the Judiciary.

Mr. Chairman, I am pleased to yield 2 minutes to the gentleman from Virginia (Mr. Boucher), ranking member of the Committee on the Judiciary.

Mr. Chairman, I am happy to yield 3 minutes to the gentleman from North Carolina (Mr. Watt), a distinguished member of the Committee on the Judiciary.

Mr. Chairman, I yield 30 seconds to the gentleman from North Carolina (Mr. Watt).

Mr. Chairman, I yield myself 15 seconds.

Mr. Chairman, I just want to remind my friend, the chairman of the Committee on the Judiciary, that he was not that happy with Federal courts in the University of Michigan affirmative action case. Remember that one?

Mr. Chairman, I yield 1 minute to the gentlewoman from California (Ms. Solis).

Mr. Chairman, I yield 1 minute to the gentleman from Missouri (Mr. Clay).

Mr. Chairman, I yield 1 minute to the gentleman from Washington (Mr. Inslee).

(Mr. INSLEE asked and was given permission to revise and extend his remarks.)

Mr. Chairman, I yield 3 minutes to the gentleman from Texas (Mr. Sandlin).

Mr. Chairman, I yield 2 minutes to the gentlewoman from Texas (Ms. Jackson-Lee).

(Ms. JACKSON-LEE of Texas asked and was given permission to revise and extend her remarks.)

Mr. Chairman, I yield myself the balance of my time.

Mr. Chairman, this bill is class warfare with a vengeance.

Here my conservative friends, Republicans, are supporting the bill that will help Enron, Ken Lay, that is right, Adelphia, WorldCom, Tyco, by making retroactive all the automatic appeal provisions. By the way, the Chambers of Commerce are enthusiastic that maybe the fourth time this will get through the Congress. The National Association of Manufacturers are for it, and so is the President of the United States. That is one side.

Now, who are the victims? All consumers groups are against the bill. All civil rights groups are against the bill. All environmental groups are against the bill. All health care groups are against the bill. All judges, Federal and State, including the Chief Justice of the Supreme Court, are against the bill.

Get the picture? We do. And so do the people in your districts from whom you are taking the right to be jurors in these trials away from.

Let us talk about the coupon business, because in the Democratic substitute, on page 12, section 1711, is the only corrective action to coupons, which have been cried about on this floor this morning. If there is any provision in the bill that is on the floor now about coupons that will eliminate it or make it harder to bring, I would sure like to hear about it in the closing comments; and I have a Detroit Free Press editorial that came out yesterday saying class action, the plan seems less about justice than helping business. And I will insert it and a letter from the NAACP for the Record at this point.

[From the Detroit Free Press, June 11, 2003]

Class Action: Plan Seems Less About Justice Than Helping Business

Now don't go making a federal case of it . . .

That old expression is a good one to direct at Congress,

since the House and Senate appear to be racing each other to

pass bills that would discourage class-action lawsuits by

shifting them from state courts to the federal system. This

is an interesting tack for a lot of conservative lawmakers

who profess to want less federal involvement in American

lives. Federal judges, already buckling under case overload,

are opposed to it. So are state judges. Consumer groups see

the bills as an overkill remedy for a system that's already

being repaired by judicial initiatives.

Class-action suits allow one or a few people to seek

damages for hundreds or even thousand of individuals who may

have been affected by a bad product or policy. They are,

understandably, the bane of big business and have been

outrageously lucrative to some lawyers. But they also have

produced changes in dangerous products or practices and held

companies accountable.

Shifting such suits to federal courts sets up new

procedural hurdles, appeal possibilities, and delays even

before the merits of a claim are addressed. Even suits in

which the entire ``class'' of potentially harmed people

resides in the same state as the company being sued would be

moved to the federal system, where cases languish years

longer than in state courts.

The House version of the legislation is particularly

offensive because it is retroactive, meaning it would affect

class-action claims now pending against Enron, WorldCom,

Adelphia and other corporations accused of defrauding

investors while their executives made millions of dollars.

Supporters will say these bills are about reforming a bad

process. What they really are about is discouraging a

legitimate right to seek redress for wrongdoing--without

making a federal case of it.

Mr. Chairman, I do.

Mr. Chairman, I yield myself 2 minutes.

(Mr. CONYERS asked and was given permission to revise and extend his remarks.)

Mr. Chairman, this is to celebrate the gentlewoman, the Senior Senator from California Day in addition to Attorney Bashing Day. We have a letter from the senior Senator of California, which says she is opposed to the bill and why she is. So what we have here is a Feinstein-lite or a fake Feinstein here.

I do not know what we are trying to do here, but this attempt to fix the class action bill creates, as I expected, more confusion and does not deal with the real defects in the bill.

Her letter says: ``As I said in committee before this amendment was adopted, I will not support any class action legislation that moves those suits to Federal court.''

So we have the senior Senator from California saying that this is a class action bill, and there has been general agreement that we need reform on class actions; but these provisions in the bill do not relate to class actions.

This is far from a done deal. I do not think we correct the basic defects in the bill; and since this is Feinstein-lite, I am going to reject the amendment that I am sure is made in good faith by the chairman of the Committee on the Judiciary.

I include the letter from Senator Feinstein in the Record at this point.

June 11, 2003.

Hon. Rick Boucher,

House of Representatives,

Washington, DC.

Dear Congressman Boucher: I wanted to clarify several

issues with regard to S.274, the Class Action Fairness Act,

and two

Amendments I offered to it in the Senate Judiciary Committee.

During House consideration of H.R. 1115, there has been some

misunderstanding about my position. I thought a clarification

might be helpful to you in your deliberations.

During Committee consideration of S.274, I offered an

amendment to raise the amount in controversy to $5 million

and to set specific criteria based on a percentage formula to

determine whether certain intrastate cases should be heard in

state or federal court. This is what has popularly become

known as the ``Feinstein Amendment.'' It is my understanding

that Chairman Sensenbrenner and a number of Democrats plan to

offer this as an amendment to H.R. 1115 on the House floor,

and of course, I support its inclusion.

I also co-authored an amendment with Senator Specter to

strike a provision from the bill that would have made certain

citizen suits and ``private attorney general'' actions

removable to Federal Court as well. I felt strongly then, and

I feel strongly now, that such suits--particularly those

brought under Section 17200 of the California Business and

Professional Code--properly belong in state court and should

not be classified as class actions under the bill. As I said

in Committee before this amendment was adopted, I will not

support any class action legislation that moves those suits

to federal court.

Senators Specter's amendment also, however, struck a

provision from the bill that would make so-called ``Mass

Actions'' subject to the same removal provisions in the bill

that apply to class actions. That was not my concern, and in

fact I believe that truly national ``Mass Actions'' should be

removable to Federal Court under the same procedures as class

actions.

I hope this clarifies some of my views on this matter. I

appreciate your concerns about this important legislation and

welcome you to contact me or to have your staff contact my

Chief Counsel, David Hantman, at 224-4933 if you have further

questions.

Sincerely,

Dianne Feinstein.

Mr. Chairman, I reserve the balance of my time.

Mr. Chairman, I yield such time as he may consume to the gentleman from California (Mr. Dooley).

(Mr. DOOLEY of California asked and was given permission to revise and extend his remarks.)

Mr. Chairman, I yield such time as he may consume to my good friend, the gentleman from Texas (Mr. Stenholm).

(Mr. STENHOLM asked and was given permission to revise and extend his remarks.)

Mr. Chairman, I yield the balance of the time to the gentleman from Texas (Mr. Sandlin).

Mr. Chairman, the problem that is presented in the bill that the Jackson-Lee amendment attempt to correct is the incredible ability of corporations doing business in this country to move offshore, Bermuda as an example, to do business and then escape coming into State court on class action by claiming they are a foreign corporation.

These are the same companies that are eager to put ``Made in the U.S.A.'' on their products, while they at the same time avoid United States taxes and attempt to minimize their legal liability by merely shuffling corporate documents. Support the Jackson-Lee amendment.