Alfonse D’Amato

Mr. D'AMATO

Mr. D'AMATO. There is no statute of limitations?

Mr. D'AMATO. So the SEC can bring these actions but the strike lawyers can't wait indefinitely and pick a forum. That is what the Senator is saying. But certainly the SEC can still bring these actions at any time that it discovers fraud.

Mr. D'AMATO. Mr. President, we cannot confirm that it is the intention of the leadership on both sides to curtail votes as of any specific time. However, it would seem to me to be appropriate, notwithstanding that, to move to support the Senator's request that we stack the two amendments with a vote starting at 5:40 for the first one, and thereafter undertake a vote on the second one. Then, of course, if the leadership has decided no further votes, we can put that matter over. We are looking to shop that right now. I believe that will be the case, but we are waiting for final confirmation. If the Senator wishes to make his request on the basis that we will proceed to our first vote at 5:40 on the pending amendment and that thereafter, immediately after that vote, take up the second amendment and seek a vote on that, I will certainly join in that request.

Mr. D'AMATO. Yes.

Mr. D'AMATO. That is my expectation, and I will make that recommendation to the leader. Subject to the concurrence of the leaders, I imagine we then will have debate, hopefully limited to, let's say, an hour equally divided on the third amendment, and then go to final passage. How much time does the Senator want in between the third vote and final passage?

Mr. D'AMATO. We can work that out and make that request later, but I certainly will not be opposed to 30 minutes equally divided before final passage.

Mr. D'AMATO. Mr. President, before that amendment is set aside, I ask for the yeas and nays and indicate that I will move to table at the appropriate time.

Mr. D'AMATO. Mr. President, let me tell you basically what this amendment would do. This amendment would have the unintended effect-- and I cannot believe that my colleague would want for that to happen-- of opening up the whole question of the class-action suits being able to be moved to State courts. It would effectively allow lawyers to circumvent the purpose, the very purpose of this bill since so-called ``huge'' mass actions could still be brought in the State court. So what we have is the problem of high-growth companies, small high- growth companies that traditional class actions may be brought against by the strike lawyers; namely, they are expensive and timely to defend, and the plaintiffs are often forced to settle, regardless of the merits, to avoid excessive litigation costs. That is exactly what we are trying to deal with. There should be a uniform standard, and there should be a uniform procedure. And that is why we moved these nationally traded securities. Senator Dodd spoke to this, the nationally traded securities going to a Federal forum. This amendment changes the predominance requirements in the bill's class action definition. This effectively would gut the bill by encouraging State actions which would not qualify as a class action contained in the act. As a result, these class actions would not be able to be removed to the Federal court. And so you have mass action lawyers representing a large number of plaintiffs on an individual basis in either a single action or a group action. The ``class action'' definition in the bill was worked out with the SEC. We have worked that out, and it is comprehensive enough to close the loophole. But it also provides State courts with guidance. It says ``up to 50 people.'' That is the bright line. When you get over 50 people, OK, that is the class action. And so this bill does not prevent individual investors from pursuing State court remedies, nor will it prevent a small group of investors from pooling their resources to pursue a claim under State law, but it will stop the strike action suits, the forum shopping that we have attempted to limit, because we have seen that dramatic increase. I think Senator Dodd, when he pointed out what the record was, I think it was a handful, what, five or six cases in a period of years, in all of the years, ballooning up to 40-plus in 1 year. What was that?

Mr. D'AMATO. Yes.

Mr. D'AMATO. Six cases.

Mr. D'AMATO. Mr. President, I think my colleague, by answering the question, points out quite clearly--it was my impression heretofore that he had mentioned a number of cases, but six cases in 3 years, jumping to 10 times that, 59--slightly less than 10 times that in 1 year--in 1 year--I think it proves the point. And that is why the necessity of seeing to it that we have a uniform standard, that you cannot go forum shopping. And that is why this Senator, at the appropriate time, will move to table the pending amendment. I yield the floor.

Mr. D'AMATO. Mr. President, I know my colleague from Nevada is going to speak to this issue, and I ask unanimous consent at 5:30 today the Senate proceed to a vote on or in relation to the Sarbanes amendment 2395, to be immediately followed by a vote on or in relation to amendment 2396, the matter we are now considering, with no amendments in order to the amendments. I finally ask that the time until 5:30 be equally divided between the proponents and opponents. I have no intention of using any of the time, but that all the time be yielded to my colleague.

Mr. D'AMATO. That is correct.

Mr. D'AMATO. Mr. President, I don't know if it is appropriate at this time, if all time is yielded back, and I know at 5:30 we will vote. Vote on Amendment No. 2395--Motion to Table

Mr. D'AMATO. Mr. President, if it is appropriate now, I move to table the Sarbanes amendment and I ask for the yeas and nays.

Mr. D'AMATO. Mr. President, what is the pending business?

Mr. D'AMATO. Mr. President, I move to table and ask for the yeas and nays.

Mr. D'AMATO. Mr. President, we have no objection. As the Senator has indicated, these classes are comprised solely of States, counties, and other public entities. There is no record of such class-action suits being brought. I might add, local governments, for the most part, school districts in particular, are typically precluded from investing in stocks, particularly in these stocks. We accept the amendment.

Mr. D'AMATO. Mr. President, I am aware of no further amendments, but I ask unanimous consent that the Senator from Oklahoma be recognized for the purpose of propounding a unanimous-consent request, and that the Senator from California--I think I have 2\1/2\ minutes left. I yield 1 minute to the Senator from California.

Mr. D'AMATO. I have no objection. I ask that the Senator be recognized to offer an amendment. amendment no. 2398 (Purpose: To amend the bill with respect to title 18, United States Code)

Mr. D'AMATO. Mr. President, I ask unanimous consent that the Senator from California be recognized for 1 minute and thereafter, the sponsor of the legislation who has not spoken today, Senator Domenici, who has been tied up in committee, has asked to be recognized for up to 5 minutes. Then I ask unanimous consent that we go to final passage.

Mr. D'AMATO. Mr. President, I have one more unanimous consent. The Senator from Nevada has asked to speak for up to 3 minutes. I ask unanimous consent that he be given that and then we go to final passage.

Mr. D'AMATO. I ask unanimous consent that Senator Kohl be recognized for a request, and then I will call for the yeas and nays.

Mr. D'AMATO. I ask for the yeas and nays.

Mr. D'AMATO. I suggest the absence of a quorum.