John Conyers

Mr. CONYERS

Mr. CONYERS. Mr. Chairman, I would like to ask my friend on the committee, the author of the amendment, the gentleman from Florida (Mr. Keller). Is he not aware of the fact that in most of these settlements, the court requires that the amounts of recovery or payment to the lawyers is revealed in the settlement?

Mr. CONYERS. Just answer this one, please. Are you aware or are you not? You are not. Then I suggest you look at section 1715, and you will see that this request that you are making, as one-sided as it is, is already in the bill that I guess you are supporting; and so it is redundant. I am impressed by the fact that defense attorneys' fees are not to be revealed, but plaintiffs' attorneys' fees are to be revealed, giving up yet another secret of the practice, namely, that defense lawyers frequently get far more than plaintiffs' lawyers. So thanks a lot for public disclosure. This is a very helpful amendment in trying to get what we call the vengeance of the ex-trial lawyers in Congress on their former profession.

Mr. CONYERS. Mr. Chairman, I want to compliment the gentlewoman from California (Ms. Lofgren) on this amendment because the State of Michigan has precisely the same provision as the State of California. The gentleman from California (Mr. Schiff) and the gentlewoman from California (Ms. Lofgren) have explained it perfectly. I just had a Committee on the Judiciary staffer, Scott Deutchman, call the attorney general, Jennifer M. Granholm, in Michigan to confirm with her before I made the statement in support of the Lofgren provision that the Michigan attorney general is totally supportive and is stunned by the notion that anything in our laws, our procedures here would require her or citizens to go into a Federal court to seek a remedy that is uniquely available to them under State procedures. So I am very pleased to indicate that our attorneys general and like those of California are totally in support of the Lofgren amendment. I hope that the Members will appreciate the significance of this provision.

Mr. CONYERS. Mr. Chairman, I offer an amendment.

Mr. CONYERS. Mr. Chairman, I ask unanimous consent to modify the amendment, and I further request that such modification be considered as read.

Mr. CONYERS. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I begin by hoping that this amendment may be accepted; but moving on, I would describe the amendment to my colleagues. This is an amendment designed to help adjust the problem that is happening with increasing frequency where our domestic United States corporations reincorporate at an office somewhere abroad, out of the United States, for the purpose of, one, avoiding United States taxes; and, two, avoiding legal liability. Now, in the 6 months of our fight against terrorism at home or abroad, it would seem to me the last thing that we should be doing would be to pass legislation which would in any way aid, help, or assist what I would call these corporate tax traitors. With increasing frequency, there are U.S. companies setting up shell companies in places like Bermuda, and the company continues to be owned by United States shareholders, continues to operate in the United States and do business in the USA and all its locations. The only difference is that the new foreign company escapes substantial tax liability and, under the provisions of this bill, could more easily avoid legal liability in State class action cases. The actions of these companies are a slap in the face to every citizen who works hard and pays their taxes in this country. Our amendment responds to this egregious behavior by treating the former United States companies as a domestic corporation for class action purposes. Now, apologists for these financial outlaws may attempt to argue that our amendment may not be necessary because the bill only deals with national class actions. But, Mr. Chairman, nothing could be further from the truth. Under this bill, actions involving State consumer protection laws brought by residents who all reside in one State could be removable to a Federal court simply because the financial outlaws tried to abscond from the State. This is not a national class action. This is a State class action that belongs in a State court, the fact that a financial corporate outlaw engaged in a sham transaction should be irrelevant as far as the legal liability in these cases would be concerned. So the bottom line is simple: as presently written, the bill gives a liability windfall to these foreign tax evaders. Today we have an opportunity to send a message that it is wrong to pretend one is a U.S. corporation when one is incorporated in Bermuda. It is wrong to seek the benefits of corporate citizenship without responsibility. It is wrong to engage in sham offshore transactions which leave hard-working United States citizens paying more taxes because they are paying less. Mr. Chairman, I urge support for this Conyers-Jackson-Lee-Neal amendment. Mr. Chairman, I reserve the balance of my time.

Mr. CONYERS. Mr. Chairman, I yield such time as she may consume to the gentlewoman from Texas (Ms. Jackson-Lee), who is a cosponsor of the amendment. (Ms. JACKSON-LEE of Texas asked and was given permission to revise and extend her remarks.)

Mr. CONYERS. Mr. Chairman, I am pleased to yield 2 minutes to the gentleman from Massachusetts (Mr. Neal), who has worked on this subject matter for many years.

Mr. CONYERS. Mr. Chairman, will the gentleman yield?

Mr. CONYERS. Mr. Chairman, I just want to compliment the gentleman on his support for the theory behind this. I would just point out to him that escaping legal liability is not a function of any other committee but the Committee on the Judiciary. So we are not trying to get to the tax prosecution, sir. We are just getting to those who are escaping, to escape the kind of jurisdiction of class action suits.

Mr. CONYERS. Mr. Chairman, I just wanted to go back to the comments of the gentleman from Colorado (Mr. McInnis), who I more frequently see on Special Orders at night in my home than I do on the floor. I am happy to find he and I in agreement. But he asked the question, will this amendment accomplish what we say it will. Well, we have talked with the American Law Division, and they agree that, in its current form, the measure offers new abilities, this bill, to remove cases to Federal court for companies that engage in corporate repatriation transactions that are not available under present law. So, in other words, the only place we can stop this is in the Committee on the Judiciary in terms of this jurisdictional opportunism.

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

Mr. CONYERS. Mr. Chairman, will the gentlewoman yield?

Mr. CONYERS. Mr. Chairman, could we hold up this bill till we get the report?

Mr. CONYERS. Mr. Chairman, the distinguished chairman of the Committee on Energy and Commerce was talking about sham class action lawsuits. I do not know which ones he was talking about, but he was not talking about the Firestone case, the Monsanto case, the W.R. Grace case, all the tobacco company cases, the asbestos cases, the black lung case, air bags, Pinto, and it goes on and on. None of those were sham lawsuits settled at 10 cents on the dollar. And I am sorry he is not here to further explain which cases he had in mind.

Mr. CONYERS. Mr. Chairman, I know Enron is not a nice word to bring up on the floor with our conservative friends. I raise the name Enron reluctantly, because it is offensive to some of our colleagues. But several of the employees in the Enron case, if they were suing Mr. Lay, affectionately known as ``Kenny boy'' in some parts of the government, for breach of an employment contract, they would be brought, under this bill, into Federal court. We need that, do we not? I do not think so, and I thank the gentlewoman for yielding to me.

Mr. CONYERS. Mr. Chairman, I offer an amendment.

Mr. CONYERS. Mr. Chairman, I ask unanimous consent to offer an amendment and present it on behalf of the gentlewoman from California (Ms. Waters).

Mr. CONYERS. Mr. Chairman, may I ask unanimous consent that we move to the next amendment and reserve the opportunity to bring it up later?

Mr. CONYERS. Mr. Chairman, a point of order. Can the gentlewoman from California (Ms. Waters) offer her amendment at a later time?

Mr. CONYERS. Mr. Chairman, I am.

Mr. CONYERS. Mr. Chairman, I offer Amendment No. 3.

Mr. CONYERS. If the gentlewoman will continue to yield, I would ask her if her amendment, then, would hold them accountable and reinforce any existing remedies against shredding, sanctions of the court, criminal prosecution, and emphasizes this, in the face of the arrogance that has been displayed in this case, and perhaps other cases that have not even come to light?

Mr. CONYERS

Mr. CONYERS. You did not like practicing as a trial lawyer. It was not fun.

Mr. CONYERS. I thank the gentleman for explaining to me what his solution is to the problem of trial lawyers making too much money.