Fritz Hollings

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, my staff brought to my attention--I wish we had billable hours for Senators. We could make a living up here. Maybe that is the next amendment we will have if they insist on this amendment, Mr. President. Pending that, we have the Model Rules of Professional Conduct and the Code of Judicial Conduct by the American Bar Association. I look at rule 1.4, ``Communication'' and I read: A lawyer shall keep a client reasonably informed about the status of a matter and promptly comply with reasonable requests for information. A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation. That is the American Bar Association Model Rule that we all are governed by. With respect to the fees themselves, rule 1.5: (A) A lawyer's fee shall be reasonable. The factors to be considered in determining the reasonableness of a file include the following: (1) the time and labor required, the novelty and difficulty of the questions involved, the skill requisite to perform the legal service properly; (2) the likelihood, if apparent to a client, that the acceptance of the particular employment will preclude other employment by the lawyer; I take that, Mr. President, to be no conflict of interest. (3) the fee customarily charged in the locality with similar legal services; (4) the amount involved and the results obtained; (5) the time limitations imposed by the client or by the circumstances; (6) the nature and length of the professional relationship with the client; (7) the experience, repetition, and the ability of the lawyer or lawyers performing the services; (8) where the fee is fixed, whether the fee is fixed or contingent. It goes on in detail on the basis of the rate of fee, the terms of payment, and all the necessary things--the divisions of fee, how to settle if there is a dispute about the fee, all are matters of disclosure. What they are really coming with on product liability is an assault against the bar. I know the former distinguished Vice President of the United States thought it was good politics, and he brought up about lawyers at the American Bar Association. If a person practices law, they are under the rule and guidelines. It is still a profession. Just like I have resisted actually the TV coverage of the proceedings here of the U.S. Senate because we could get a lot more work done and we did a lot more work and we got things done. I also have resisted the so-called advertisement by attorneys with the neon sign ``Divorces, divorces,'' or ``If you think you are hurt,'' or, ``We get more money in our claims than anybody else.'' I think that is unethical. I hate to see that coming about with the particular profession. If we take the television out of the O.J. Simpson courtroom, that case could be handled in the next 3 weeks. But it will take the next 3 months at least with TV there. The idea is to get justice and not to amuse the public generally. I hope we get the television out of this body, the television out of the courtroom, and get back to some economic sense, go to work for the people of America, and certainly not take what never has been recognized as a national problem, except with respect to the American Bar Association and its code of conduct which it has over the many, many years. It has never made a national problem to be legislated upon. I know what they have in mind, and I think that my amendment will help them get at the 60,000 billable hour lawyers, and not the trial lawyers. They really go after the trial lawyers and product liability. I want to talk about the corporate lawyers and that billable hour crowd that extends out. I have heard my colleague from West Virginia. He does not have any understanding of the law practice. He says, why, at the State level it is very difficult to get product liability reform. False. We have it in 46 of the 50 States in the last 15 years. He says one of the reasons we cannot get it are these trial lawyers holding things up because they like to extend their cases and get more money. Extend more cases, I get more expenses. I am paid on a contingency basis. I am not paid by a billable hour. The fellow who gets more money is the insurance company lawyer, the corporate lawyer. They love it. They try to stretch it out, get continuances, make more motions and everything else. I got 10 or 15 good cases in the office that I have taken for seriously injured clients. I have hundreds of thousands of dollars in time and costs wrapped up. I am really having to carry and finance, which we do. I have done it in my private practice. We know how it is in corporate law. They have the mahogany desks and the Persian rugs, and they sit down there with the paneled walls and just answer the phone and everything. Answer the phone and say, by the way, charge him that I talked to him on the phone. I never heard of a contingency fee lawyer say I talked to somebody and charged so much. They charge so much per telephone call, so much per letter, so much per hour, so much per this. There is more per fees in the practice than we could ever contemplate. Heavens, let us not write this bureaucracy into the law. Mr. President, I suggest the absence of a quorum.

Mr. HOLLINGS. Mr. President, that is not uniformity; the Senator is quite correct. More restricted measures are permitted. The fact of the matter is that it is not uniform with respect to one of the big issues of concern, the matter of punitive damages. In the distinguished State of Washington, home of the manager of this bill and the principal author, they do not have punitive damages. Where they have punitive damages, they are limited to $250,000, but they are not required by this bill in those States that do not have punitive damages. There is no uniformity here. If they really wanted uniformity, we would have had ipso facto a Federal cause of action. Then we would have the rules, the simplicity, and the uniformity. There is no attempt to produce true uniformity, even though we have had wondered about this particular measure and requirement of the States in their jurisdiction. There is a constitutional question involved, but they have said: ``Wait a minute; if we really want uniformity, please give a Federal cause of action and we will go from there.'' If we want a finding under the interstate clause, Congress has that authority and responsibility to make the finding and get a Federal cause of action. Then we have uniformity. But they use every gimmick to make sure it is not.

Mr. HOLLINGS. That is right. Take every page of the bill--every page of the bill has certain legislative, congressional language. That is to be interpreted, the intent of that particular language is to be interpreted by the 50 several supreme courts of the 50 several, separate States. Then, in certain instances, it could go all the way to the U.S. Supreme Court. So they know that. We would not have that if we had a Federal cause of action. We would have one jurisdiction and we would move with that and the lawyers and the parties would know where they are. They do not want them to know where they are. There are certain roadblocks, restrictions, as indicated in your question. This bill says that, if we want to get more restrictive or want to put a greater burden to the injured party, fine. We do not mind at the national level. If we approve this bill, we are saying as a Government up here, if people want to do that, the Government in Washington, the great white father, we approve that. If a State wants to be more considerate of the injured party; no, no. We, the Federal Government, the end-all, be-all of wisdom up here, the Washington bureaucrats, we say no.

Mr. HOLLINGS. I thank the distinguished Senator from Louisiana. He has been a leader on this measure. I can say manufacturers are not all that steamed up. They would have long since gotten rid of me. They have tried, and they have come pretty close the last time, so I am not bragging. I can say right now, the manufacturers understand it. I met time and again with manufacturers, business leaders, bankers, and everyone else of that kind, and they begin to realize that. I have asked, I challenged them, get a judge in the State of South Carolina that has just been put up to the circuit court of appeals, as has Billy Wilkins. Remember Judge Wilkins, who headed up a sentencing commission for President Reagan and was considered for the head of the FBI? Go back to Billy and say, ``Is product liability a problem here, really?'' He would say, ``Not in South Carolina, not in the State. They handle it well.'' This has not come from the judiciary or the American bar. This has not come from the consumers, whose interest it is supposed to--with that title, Fairness Act--supposed to represent. On the contrary, it is a manufacturers scam. I yield the floor. Mr. President, I suggest the absence of a quorum.

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

Mr. HOLLINGS. Mr. President, I have been waiting my turn to comment on the observations of my distinguished colleague from Washington. I have been waiting with anticipation. The distinguished author and manager of the bill, the Senator from Washington, said, as best I can remember that here in the Senate, if we seek to accomplish a certain goal, we should do it absolutely. It is very, very curious to me, if we seek to accomplish a certain goal, we should do it absolutely. require uniformity? It is not about whether it is an absolute or a balanced measured, or any forensic approach. It is a matter of law and what is provided. We go right to the idea of uniformity and its inconsistency with respect to the States. Very interestingly, Mr. President, this bill--which I have a copy of--starts off, if we look at the front page of S. 565, as ``A bill to regulate interstate commerce by providing for a uniform product liability law.'' Well, they got into that pollster nonsense that I was talking about earlier. They do not want to call it a uniform law, rather they now want to focus on fairness. The buzzword now is everything has to be ``fair.'' I do not know who it is going to be fair to. They say here that ``This act may be cited as the Product Liability Fairness Act.'' However, what they ought to call it is the ``Product Liability Generosity Act to Manufacturers of 1995.'' Very, very generous to the manufacturers. Now let us go to the matter of punitive damages. Let us look at S. 687, the 1993 bill, at page 22. S. 687, page 22, says in the proof of punitive damages: In determining the amount of punitive damages, the trier of fact shall consider all relevant evidence, one, the financial condition of the manufacturer of product seller; two, the severity of the harm caused by the manufacture of product seller; three, the duration of the conduct or any concealment of it by the manufacturer or product seller; four, the profitability of the conduct to the manufacturer or product seller; five, the number of products sold by the manufacturer or product seller of the kind causing the harm complained of by the claimant. These are the elements that you have, generally, at the State court level on the proof of punitive damages, so it is not just a runaway jury. Many times I have heard--and the distinguished Presiding Officer has tried these cases--a judge turn and say there is going to be a fine to make sure they do not engage in this reckless course of conduct again. And in determining whether there is going to be punitive damages, it's important to look at the worth of the organization and whether or not it is a customary violation, the duration of the conduct or concealment of it and all of these elements. Now look at the matter with respect to this particular bill, S. 565, on punitive damages. They do not list those things at all. It says here at the bottom of page 47: ``Proceeding with respect to punitive damages.'' Line 24: ``Evidence that is admissible in the separate proceeding under paragraph 1--(i) may include evidence of the profits of the defendant, if any, from the alleged wrongdoing; and (ii) shall not include evidence of the overall assets of the defendant.'' That is all. They don't spell out what you can look at in this bill, Mr. President. You can consider evidence of the profits from the wrongdoing, but not any evidence whatsoever of the overall assets, or the nature or the duration of the conduct, or concealment of the manufacturer, or the number of products sold, or the financial condition of the manufacturer. In fact, they say: ``Shall not include evidence of the overall assets of the defendant.'' In the Exxon Valdez case, how do you think Exxon Corp. profited from running into the ground? There would not be any profit there. I could go through the list of different manufacturers' cases. I refer to the matter of the illusory part position on the Ford automobile, whereby the users of Ford cars between 1970 and 1979 thought that when they had a car in the park position, it was giving the operator the impression that the car was secured. Of course, it was the slamming of the car door or vibration caused the car to move in reverse. We have one case here, and several others, about a car that backed up into a particular individual that was walking by the rear of the automobile and was run down, and they gave $4 million in punitive damages. Under this particular test against Ford, if you put this into law, I do not see where Ford gained an advantage or made profits--if they could call it profits--from the misconduct that caused the injury to the pedestrian that the car all of a sudden backed into. Of course, Ford Motor Co. could change the thing. When they got the punitive damages, they understood and changed the park position in the gear of the Ford automobile. But to come now, and rather than list commonsense provisions that they had in the 1993 and 1991 bills and everything else, they put these kinds of restrictive provisions in, and then claim it is a fairer bill. I go right to the punitive caps there on page 47. They have in the bill what purports to be uniform standards for punitive damages. But when get beneath the cover, Mr. President, you discover the real deal. That is, if you have punitive damages in your State, it's preempted. But if in a State that does not provide for punitive damages, you are not given the benefit of uniformity. The Senator from Washington does not want uniformity for the State of Washington since they do not have punitive damages, but, yet, he is talking about uniformity. Of course, it is all uniformity so long as it is advantages, so to speak, for the manufacturer, but not the injured party. So this does not provide for punitive damages in all States and for all citizens, even though the so-called goal of the bill is uniformity. In this particular bill, he said, even though we want uniformity, if you do not have punitive damages, no way, you still do not get them. On the other hand, even if you were injured, you cannot exceed $250,000 or three times the economic loss which, in many instances, is a lot less than the $250,000 cap. So you do not teach the lesson there. With respect to a more reasonable bill, again, you have the matter of misuse on page 44. Regarding the previous bills, they are talking about how reasonable they have gotten now. ``Reduction for misuse for alteration of the product.'' This provision was not in the three previous bills. The statute of repose, as has already been pointed out, for no good reason, has been reduced now to 20 years. So pass this, with the House at 15 years, it is going to be reconciled downward. The liability shield for component parts manufacturers was not in the three previous bills. As the distinguished Senator from Alabama, having a heart beeper in his own body, which is obviously comprised of component parts, said wait a minute, if this thing is defective, do not give me this particular bill or I am a definite loser. There will be no recovery there. On the morning of the markup, they added this rental car provision to exempt rental car companies from liability. If you get a rental car and you run into somebody, the rental car owner is not responsible. But if you borrow my car, and run into somebody, I am still responsible. They have many more severe provisions, if you read down, as we have in covering this particular measure. The fact of the matter is that this bill is not intended to be more reasonable but rather more restrictive on those seeking recovery for their particular injury. And I want to go here to the uniformity part where it does not apply to the manufacturer, and they talk now about the Uniform Commercial Code. Mr. President, I ask unanimous consent at this particular point--it is not that long--to have printed in the Record an overview of the Uniform Commercial Code.

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

Mr. HOLLINGS. While I am trying to obtain a copy of the amendment, I have in hand from the distinguished Senator from Michigan a copy of a letter dated April 24, I take it, outlining the amendment itself. It says here: Under our proposal, at the initial meeting the attorney would be obligated to inform the client of his or her right to obtain, within thirty days, a written statement containing (1) the estimated hours of the attorney's services that will be spent (a) settling or attempting to settle the claim and (b) handling the claim through trial; (2) the basis on which the attorney proposes to charge the client (hourly, contingent or flat fee); and (3) the hourly rate, contingent fee, or flat fee the attorney proposes to charge. The attorney would then be obligated to provide that statement to the client within thirty days unless the client in writing waives the right to receive it, or extends the time. Mr. President, on the matter of fees, I was in the practice actively for 20 years and I never had outlined this. I have always had an understanding, and a written one. I wish I had one of the forms here, because it was the minimum fee schedule, approved by the Charleston bar, my hometown, where we had a minimum fee schedule--at a formal meeting that was agreed upon--and that was a contingency contract. And wherein I was retained, I had that contingency contract signed not only by, of course, the client, but by myself. In 20 years I have never found this problem. You can get this professor. I doubt he has tried a case, because I find that is the case with most professors and that is why they are professors. But right to the point, this so-called estimated hours. Let me go to one of the cases that was taken all the way to the Fourth Circuit Court of Appeals and then finally abandoned before the Supreme Court. It was a case of the C&S Bank as the trustee for Harold Tummestone versus the Morgan Construction Co. The reason I got the bank as a trustee is because the particular individual had been severely damaged, brain damaged, which I will be glad to go into because, unless others want to speak to this particular amendment, until I can get a copy of it I want to say a few words. But we wanted to get comity or the trustee to bring that particular case. I knew the bank had credibility. I wanted to bring credibility to this so-called damage suit. Of course I got the bank to go over there and handle it and have them review all of my activities. With respect to that, I can tell you the bank would not have required, and the bank would not have had any idea, nor would I have had any idea about the estimated hours of the attorney's services that will be spent (a) settling or attempting to settle the claim. Excuse me, let me rescind that particular statement by saying, yes, I could have put on there an estimation of (a) the hours spent settling or attempting to settle the claim. But, I can tell you here and now, they never offered any settlement. We tried that case. It was not until the jury came in that they wanted to try to even talk about settlement. I will never forget it. The trial judge in court recommended that we settle the case. The truth of the matter is I had proven a very, very strong case. I felt very confident. In spite of the admonition of the trial judge, I told him to go ahead and write his order, whatever it was, but I was not going to yield 1 red cent on that particular verdict because I knew what we had done. And I was not offered any settlement. I never had billable hours. That is annoying to this particular Senator and lawyer. I have no idea how you can really make it. You might sit in an office and talk about so many hours you are going to try to settle. But it depends on how you reach the case on the docket and what the pressure is that you can bring on the defendant, if they can get a continuance and everything else of that kind, and there is such a tremendous variable it does not help the client and it does not help the lawyer. It is a sort of spurious thing. We believe in the client being informed. The information that I have always had with respect to the contract and agreement with my clients is just exactly as I have pointed out. It is a contingent basis of one- third, whereby we assume, as the attorney for that particular case, all costs and all court costs, all medical fees to get examined by doctors and specialists' fees. I remember in this particular case I had to get a neurosurgeon to come down and spend several days and later on testify. So not only were his fees billed to me--you have to pay the doctor's fee if you do not want a witness who feels like he has not been paid. You want him to be a happy witness, so you pay his medical fees. You pay the investigative fees. You pay all the interrogatory fees, discovery fees, all the time. You pay for the appeals and the brief and the court, the transcript of record and everything else, the printing of that on appeal. And of course all your hours and time--I did not sit down and start computing hours and time. But for the poor, indigent client, ``Look. Don't worry. We will do our level best to get you any recoveries made, and any offers made we are obviously going to tell you what the offer is and make sure you know about it. And you have the approval or disapproval of any kind of settlement offer.'' Because, of course, we have malpractice in law as well as malpractice in medicine. So you have to protect yourself and deal open and on top of the table with the particular client. But I can tell you now. Being at the bar, this particular thing here is the first I ever heard of it. I started in 1947; 1997 would be 50 years. So in almost 47 years of practice, I never heard this as a problem. Let me go further. I can tell you what I find as a problem. But the basis on which the attorney proposes to charge the client an hourly contingent or flat fee, I think I can answer that and just say what I have said here. Three, the hourly rate contingent fee or flat fee the attorney proposes to charge. So mine again would be just the contingent fee. I could comply with two and three. But I have no idea about the estimated hours of settling or attempting to settle the claim and estimated hours of handling the claim through trial. Of course, it says nothing here about the appeal. It says similarly, within 30 days after completion of the litigation, either by settlement or trial, the attorney would be obliged to furnish the client a written statement describing, first, the number of hours the attorney expended in connection with the claim; second, the total amount of the fee; and, third, the actual fee per hour charged regardless of how the fee was structured. That brings us back. I really object to bringing it back to billable hours because we have to work and represent clients. I am not in Michigan in one of these large law firms. We are in a relatively small town. I guess speaking with respect to large law firms in any event, and I have to spend, not bureaucracy and regulatory. Here we have regulatory reform. Now they have regulations here about actual fee per hour charged. We will have to hire someone to keep track of this thing because I have work to do, study the law, interview the witnesses, and talk about not only the pleadings and everything else of that kind but the chances of prevailing. All of that is tied up as we have been hearing about 2 to 3 years. I would rather just put it on a contingent basis trying my best to get it to trial and get it to a conclusion, and not be into the proposition of the actual fee per hour charged and trying to compute it. There is nothing wrong with disclosure. Like I say, I disclose. I want a clear understanding. I cannot represent a client fully and fairly unless there is absolute trust. You build that up. You do not write that into law up here in Washington. I practice law. You get a reputation. You get a reputation for trust and for accomplishment, and by that reputation of being able to be successful at the bar and totally trustworthy, the word spreads. You get a client and you get a successful law practice. Incidentally, I had it. I had at least three times what I made when I got here in 1966. But one of the things I really did not like was charging clients. I never did charge enough. A client told me that here where I do not have to worry about charging the clients. I can talk to the jury and then go in with the jury and vote. I like this much better. I get a variety of cases, too. I do not get a reputation just by bringing one set of cases on the claimant side. You get any and every case whether it is a terrorism case, whether it is a product liability case, or whether it is going to be telecommunications or whatever it is. So it is the enrichment of the learning experience up here that attracted me and not the fees. But having said that, what really disturbs me is this trying to bureaucratize the law practice which I have resisted. But if we are going to go ahead and bureaucratize the law practice, what really is outrageous in my opinion is this billable hours whereby this crowd downtown here is charging $300, $400, $500 an hour. I will never forget when I was first up here and I put in on the case statute the textile amendment. I got help from the distinguished Senator from New Hampshire on the other side of the aisle, Norris Cotton. After we succeeded in passing that textile bill over 25 years ago, Senator Cotton said, ``You know what so and so downtown was paid to pass that bill?'' I said, ``I did not know he had anything to do with the bill.'' He said, ``No. But he was retained by the industry and given $1 million to get that bill through.'' I said, ``Did you ever talk to him?'' He said, ``No. I never did talk to him. But I just found that out.'' I never talked to him. But these lawyers in this town get these enormous fees. I found since that time regarding drugs--that is a terrible menace to our society-- that these lawyers that are successful in the drug cases immediately demand and receive a $50,000 retainer, $100,000 retainer, large, exorbitant fees of that kind. I think that is really the thing that discourages society against the lawyers. I think what we ought to do really is limit the attorneys' fees. I think what we ought to do is limit the billable hours, the attorneys' fees in all cases, the billable hours to $50 an hour. Mr. President, at $50 an hour, at a 40-hour workweek, and a 52-week year, you would exceed over $100,000. That is just $50. Of course, if you work on weekends and overtime like any trial lawyer would work overtime. Everybody was off to the football game and Sunday afternoon driving with the family, and I was working in the office and Sunday night getting ready to go to court on Monday morning. You could easily at $50 an hour, if you work as a lawyer, make $150,000 to $175,000 a year. I think that is a good salary for a working lawyer. Senators get less, of course, and work harder. We start out early in the morning around here, and then when you supposedly get time off like Easter break, that is constituent service. What I want to do is send an amendment to the desk to limit attorneys' fees in all civil actions to $50 per hour. And at the end of the matter proposed to be inserted, I want to add section 302, limitation on fees. If an attorney at law brings a civil action, or is engaged to defend against any civil action, the word ``action'' should be inserted there because I was not familiar with this particular amendment and never had heard of it until the distinguished Senator from Michigan submitted it. But if any attorney at law brings a civil action or is engaged to defend against any civil action, the attorneys may not be compensated for legal services provided in connection with that action at a rate in excess of $50 an hour. I expect to get reelected on this amendment. I can tell you here and now, if we can bring that down to $50 an hour. I remember my poor colleagues on ethics charges having to go back on this particular record. You have my colleagues here right now who would elect me President of the Senate if they could get a fair vote because they were charged $400 an hour, and they all owe their lawyers downtown. You come to this place and in the legal game of bringing ethics charges and everything else of that kind and then having to go through all the records and what have you and pay the lawyer downtown, you have got $400, $500 an hour. I have heard of all kinds of charges of that nature. And I think that what we ought to do is get to the real problem in these civil actions, not just in product liability, if we are going to have an amendment that goes into all of this disclosure like there is some kind of secret hocus pocus. Now, let me agree with the distinguished Senator from Michigan. I noted in that letter as I was reading, and I quote, ``This concern is not merely hypothetical.'' So says the Senator from Michigan. To give just one example: According to the Washington Post, last month, attorneys collected $16 million in a settlement of antitrust claims against several airlines. Their clients received coupons worth $10 to $25 redeemable toward the purchase of airline tickets, under limited and restricted conditions. According to Prof. Lester Brickman of the Cardozo School of Law, in many tort cases lawyers are charging standard contingent fees even though the contingency is in name only. Similarly, professionals who audit law firm fees find significant overcharging in many of the cases they examine. If you got the contract that this lawyer has had, you cannot find any overcharging. If you get the one-third, you have to pay all the costs and you have been paying for doctors; you have been paying for printing costs; you are paying for interview costs; you are paying all kind of costs over the 2- to 3-year period, and that comes out of your fee. That does not come out of the claimant's award or verdict, I can tell you here and now. I do not know the background of this particular case, but it is obvious to me this antitrust claim--and that is what these lawyers get in so much billable hours. I noticed in one they had on another bankruptcy, and so forth, if someday we can retire and get to be a referee in bankruptcy and sit around on golf courses, learning how to finally settle the bankrupt nature of the entity, we can pay really thousands and thousands of dollars in fees, which to me is a disgrace. I have seen that happen in my own backyard, and I have complained about it in our hearings on bankruptcy cases. But this $16 million in the antitrust claim no doubt was approved by the Court itself. Now, they had a claim and they had all of these billable hours. I know how to get that $16 million down to about $2 or $3 million by coming down to my amendment with $50 an hour maximum at that particular time. I think that is one way to rectify what the distinguished Senator from Michigan finds is an abuse. It is not really lack of disclosure because when you get an antitrust case of this kind, you bring a class action, which apparently this was, you really produce a case that was not in existence. You go around and fetch people who do not have any idea that they are being recharged and you tell them I wish to get and bring a class action; I happen from research to believe that you have a case here; you are not obligated to pay anything to me unless we succeed. So the clients, while the distinguished Senator from Michigan may complain and I may complain at an inordinately high $16 million fee, you can bet your boots that the people themselves had nothing to complain about because they did not have anything in the first place. They did not even know they had a claim. They did not even know they could get involved and help bring this abusive practice of overcharging by the airlines to a halt. So they have performed a public service. Whether the lawyers in that particular case deserved $16 million, at least the Court thought so. And the clients could well have appealed, and it could have been adjusted, and it could be subject now to adjustment and that kind of thing. I just really do not know. I agree that I am, as the Senator from Michigan, disturbed not about disclosure because clients can find out. And I can tell you now, if you have a client and you come around and all of a sudden win a case and you do not have an understanding, that client can go to another lawyer and you have malpractice on your hands. You can be hit with a malpractice suit, whether they win or lose. What happens is that hurts your reputation. So irrespective of the merit of the particular case, you any kind of misunderstanding with clients. So, yes, write it down, write down the contingent fee. But I would have to oppose the amendment with respect to the billable hours. But if there is to be billable hours in product liability claimants attorneys' restrictions, then I think maybe, if that is the will of the body, they want to consider limiting attorneys' fees in all civil actions to $50 per hour. Amendment No. 598 to Amendment No. 597 (Purpose: To limit attorneys' fees in all civil actions to $50 per hour)

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

Mr. HOLLINGS. I have explained the amendment and about read it to my colleagues. I thank the Chair. I yield the floor. Mr. McCONNELL addressed the Chair.

Mr. HOLLINGS. Mr. President, I will read this little example to show exactly what we are getting at: Suppose a contract is completed in Florida for the sale of goods to be delivered to a Canadian buyer in Montreal by a seller incorporated in Delaware, but operating factories in Arkansas, Louisiana, and Wisconsin; the contract stipulates that New York law shall govern its validity, construction, and enforcement. Now, there we are. Talking about foreign shopping, New York lawyers sitting up there on the top floor of the World Trade Center Building, having their martinis at lunch, they say, ``We do not care what State this is in, we have the Universal Commercial Code and for us we will select where we are, where it is convenient for us to try cases, or any other forum that is available to us.'' But not the injured party. They claim all they want is uniformity, but have the unmitigated gall to include an exclusion for manufacturers--for manufacturers. They boldface put it in there as an exemption for manufacturers for this particular law that they say is such a national necessity. I have seen a lot of activity in my service here as the junior Senator over the years, but I have never seen a provision where they come in, absolutely representing the manufacturers and saying they are trying to get money to the injured parties. They really say that. I will go back to the Congressional Record and show it. Where all the representative organizations of injured parties, whether it is the lawyers themselves or otherwise the consumer groups of Americans say ``No, no, no, do not give us this,'' yet they put in all the favorable provisions for the manufacturers. With respect to the joint and several, we know there are some 10 States that do not include joint and several but rather, several only for the proof of compensatory damages. Do we think they make that uniform? Just as they do not extend punitive damages to those States that do not have it, they do not extend the joint and several provision to those States that only have several. If it was the intent to get uniformity, we would have it there, but they do not provide it there. So, we can go right on down the list in all regards to this particular bill with respect to uniformity on the one hand, or how far they have come over the past several years and made it more reasonable, when the truth of the matter is they have included a lot of things here in this particular measure that were included in the House bill, so that when it passes the Senate, of course, it will not be conferenceable at all. It will not be subject to the conference because it will be a provision not in dispute but contained in both measures. I yield the floor. Amendment No. 597 to Amendment No. 596 (Purpose: To provide for equity in legal fees, and for other purposes)

Mr. HOLLINGS. Mr. President, I will read the very first line: As of 1988, one of the three different Official Texts of the Uniform Commercial Code was in force in each of the American States except Louisiana. . . . The United States Congress did not enact the code as general Federal statutory law. It is talking of the nature and origins. Then it goes on to point out that what we have under the code is a selective process. It says here in the section two, titled ``Commercial Law Not Covered; Freedom of Contract'': Finally, most of the Code's provisions are not mandatory. . . . Most commercial law is therefore not in the Code at all but in private agreements, including course of dealing, usage of trade, and course of performance. The Uniform Commercial Code is not uniform. Now that is the manufacturers. I ask unanimous consent to have printed in the Record a particular law review article on the conflict of laws under the Uniform Commercial Code at this point.

Mr. HOLLINGS. Mr. President, awaiting others who wish to address this particular problem, I would like to emphasize, of course, the good that has been done over the many, many years when we have debated product liability. The sponsors of the bill here are looking for a problem to solve and disregarding the fact that the United States of America is the safest society with respect to manufactured products in the history of the world. That has been done in large measure due to that group of trial lawyers, damage suits, punitive damages, and other verdicts. With respect to punitive damages, they can only come about as a result of gross negligence and willful misconduct. And in my State, and in many of the States, some States do not even allow them. But in my State, if the trial judge himself does not find proof of willful misconduct to his own satisfaction, he just throws out that particular finding. So punitive damages have been used very judiciously, and in reality, are seldom used. For example, we asked the particular witness who appeared before us at the hearings who had presented the issue of punitive damages before the U.S. Supreme Court, we asked him to please study and come back and report to us over the past 30 years the total amount of punitive damages found. I know from my own experience and otherwise that it was a small amount, relatively speaking. I cited at that particular time the $3 billion punitive damage verdict in the Exxon Valdez case. And the gentlemen studied the particular findings of punitive damages over the 50 States in the past 30 years and it was $1.3 billion. Of all punitive damage findings, in all product liability cases, there was an amount less than one-half in one manufacturer's case. That has been the problem, Mr. President, in the sense that the great number of punitive damages are industries suing industries. An example again was down in the Pennzoil case, in Pennzoil against the Texaco Co. in the State of Texas some years ago. Again there was another $3 billion finding. So I can just cite two manufacturer's cases where all the punitive damage findings in product liability cases amounts to one- sixth of the amounts of those two cases. But look at the magnificent good that the tort system has done over many, many years. I think, for example, Mr. President, of the 4 million minivan recalls by Chrysler Corp. here in the last several weeks. Quite to the point. You do not find Chrysler Corp. recalling minivans to correct that faulty latch on the back door because they think it is just good business. They know good and well that they are going to get socked for actual and punitive damages if they willfully allow that particular defect to continue, to knowingly, willfully, heedlessly-- recklessly is the language used in punitive damage awards--allow that to continue. And as a result we will give the body before long over at the Department of Transportation information about the millions and millions of car recalls by the various automobile companies over the past several years, which means what? Which means exactly what we are trying to say. If you want to talk about Medicare, limit the damages, limit the recovery of the injured parties as a result of the neglect of these manufacturers as this bill does, and what will happen is that you and I will pick them up in Medicare and Medicaid costs. In all my years of trial work, I have never really seen an injured party make money. And I can tell you less and less of those in the trial bar are joining that particular trial bar because the other is much more luxurious. If you can represent the industry, the business, the manufacturer, if you can represent, as some 60,000 lawyers here in the District of Columbia represent, lobbyist consultant causes, hardly ever entering the courtroom, you are into the game of billable hours. In my 20 years of active practice and over 40 years at the bar--almost 50 years now at the bar--I have never had a billable hour case. We are always practicing law from the standpoint of the success of the trial and the representation of that particular client. But be that as it may, let me emphasize going right to the different studies made by the Rand Corp. and others, large manufacturers have responded to product liability suits by establishing corporate level product safety officers. In the 1987 Conference Board report, 232 risk managers reported that over two-thirds of the companies in this survey had responded to product liability by making their products safer. I can go down the list of the various trials and findings that led to a change of practice, whether it is in the Dalkon shield case, or the Drano case. The evidence showed in the Drano case that, subsequent to the plaintiff's injury, the screw top on the can was changed because it caused it to explode. That particular design was changed on account of the plaintiff being awarded $900,000 in compensatory damages and $10,000 in punitive damages. With regard to firefighter respirators, three firefighters in Lubbock, TX, were killed as a result of a defect in their respirators, a hole in the diaphragm. A lawsuit revealed that the company knew that the respirator was unsafe. The manufacturer later corrected the mask as a result of the lawsuit. I have a whole documentary of product after product after product being made more safe than ever before on account of product liability. We are all talking like product liability is a burden on society. It is an advantage to the American body politic because it brings out this safe conduct. Specifically, Mr. President, just a few years ago, originally some 15 to 20 years ago, I went into Bosch, a manufacturer of fuel injectors in my backyard, which now has graduated up to making antilock brakes. I would think that any investor on the New York Stock Exchange would say wait a minute, before I invest in the antilock brake manufacturer, I can see that after a year one might go awry, after 10 years a car with an antilock brake might go and cause the one wheel to lock and the rest spill them over and cause, without even running into somebody else, a serious accident. I better not invest in an antilock brake manufacturer. The truth of the matter is that I was introduced into the manufacturing plant itself, and I put coverings over my shoes, a smock around my clothing, a head cover over my hair and my head and everything else as if we were producing pharmaceuticals or film. We have the film making plants of Fuji that is doubling their size right now in Greenwood, SC. I have Hoffmann-La Roche actually building the most modern pharmaceutical plant in the world in Florence, SC, right this minute. And we have brought in Parke-Davis and Baxter and Norwich and the other medical pharmaceutical manufacturers. So we know about them. I thought I was already into one of those film making plants where you could not stand the slightest speck of dust. I asked the manager at the Bosch plant, I said, ``Let me ask you about this plant. How many product liability claims have you had?'' He said, ``What's that?'' I said, ``Product liability claims. Defective antilock brakes, some of them going bad.'' He said, ``Oh, Senator, we have never had a product liability claim. If we had''--and he quickly ran over on the line there and picked up one--he said, ``See that little number. Every antilock brake that goes out of this particular plant has a serial number and we could immediately identify where and at what stage any kind of defect occurred, but we have never had it.'' Now, that particular corporation makes the antilock brakes for the Toyota, for the Mercedes-Benz, and was recently awarded a 10-year contract for all General Motors cars. This is what we have going on as a result of product liability. It is not the stultification or denial of the development of manufactured products or pharmaceuticals or whatever else. What has developed is far more safe to the consuming public. We know that, and we appreciate it. The Consumer Federation of America, Consumers Union, every consumer organization of any credibility whatsoever in the United States of America, is absolutely opposed to this so-called reasonable bill. They know it, and I know it. It is not reasonable. They have caps on punitive damages now in this bill. We never had in the last three Congresses the matter of misuse. Now they have a misuse provision. It allows them to get out from under the particular claims exemption. They have the exclusion for rental car exemptions, the matter of component parts. We can go right on down the different things that have been sneaked into this particular bill. To talk in terms that I have heard recently about how you cannot pass product liability reform at the State level absolutely begs the question. The distinguished Presiding Officer knows that. He has it in his own State. In 1988, in South Carolina, under a Republican administration, a Republican Governor, we had a get-together of the chamber of commerce, the textile manufacturers, the pharmaceutical groups, the trial lawyers, the medical bar and all insurance companies, and we got a product liability reform bill passed and signed by the Governor. Forty- six States have done that. I heard just recently that, to do that at the State level would take 4 or 5 years because those trial lawyers would come in and delay it, because they like delay. Totally false. The sponsors of this bill do not understand that. I am a trial lawyer. That is the last thing I want is delay. I know the game. The insurance company is going to ultimately pay, if at all, if there is going to be any recovery. The insurance company and the manufacturers' attorneys win every time if they can delay the case. Witnesses get lost, they ``malaccuse,'' and everything else of that particular kind, and all along that trial lawyer is having to pay for what? For the investigative costs, the medical experts, the depositions, interrogatories, the court costs, his own time and everything else on a contingent-fee basis. You get 5 to 10 fairly substantial cases in your practice and you are carrying those for 2 to 3 years now. Do not tell me it will take 4 to 5 years, I will go broke. So I as a trial lawyer am trying my best to bring those cases to a conclusion. Yes, the trial lawyer does have a self-interest in bringing that case to a conclusion and as quickly as he can. The delay is on the other side. I know, because I represented the electric and gas company and the bus operator in my own hometown in defending injury claims against that bus company. Any time I got the investigators--and we can sit up there with the mahogany desk and nice Karastan rug, answer the phone and act dignified and do not have to worry about looking for any witnesses or talking to any doctors or anything else, just tell the investigatory team of the large corporation--and it was the largest corporation we had in the State of South Carolina at the time I represented them--``Go ahead and get all of those statements. Don't worry about it.'' ``Miss so and so, fill out interrogatories No. 52 and send that to the lawyers and I'll send them another bill.'' Oh, man, that is luxury practice. That is what you have downtown here. That is what you have with this crowd that is sponsoring this particular bill. They wrote it. The game plan now is quite obvious. The game plan is ooze and cruise. How reasonable and how fair and they call it the fairness act and all that nonsense, like somebody is fast asleep, and then go over there and get with the Gingrich contract. Republicans are rolling over on this side with the Gingrich contract. He writes it over there. He tells them, ``You do this or you're out of it. You're not going to have your funds raised by us, you're not going to have our support in the next year's election and if you want to be on the team, you have to come out for practice and vote as we say vote.'' Right now they have in the morning news how they are trying to get them to sign a pledge about a budget. Can you imagine that? Like joining some organization or fraternity. I never was in a fraternity. They were against the rules at the campus of the college I attended. But you take an oath. So they have an oath of loyalty to whatever else--not to the people they represent or their conscience but what Mr. Gingrich and the contract finds. So we are in a dangerous strait here in this particular body. We will be asking for time to debate every one of these particular measures. You have not only the matter of the punitive damages provision in here, you have the exemption for the manufacturer. You would think that the conscience would get them, if you please, and they say, ``Well, it makes no difference.'' If it does not make any difference, I want them to go along with the amendment when we put it up that the manufacturer will also be under the provisions of this particular measure. They have it for everybody but who? The manufacturer. The manufacturer is not subject to the provisions of this bill. It is a manufacturer's scapegoat if there ever was one. In good conscience, I just could not put up a bill like that and try to defend it amongst my colleagues. I would lose all my credibility. But that is what they have. They say it is not restrictive. Yet, certain evidence is not admissible. They say it is simplicity, eliminating duplication, the multiplicity of suits. They asked for a bifurcated system on the one hand for action and on the other hand for punitive damages and say you cannot on the willfulness part submit that kind of evidence in the actual damage claim over here for compensatory damages. The Conference of State Supreme Court Justices came up, the National Conference of State Legislatures came up and said this is really going to bog us down taking the guidelines from Washington and trying to administer with new words of art and provisions at the State level. If there is ever one unfunded mandate, this is it. This is an unfunded mandate back at the States to cost more money, more legal costs and everything else of that kind, and they have the audacity to come forth with a straight face and say they are interested in the consumers getting the money because the lawyers are getting too much. That is out of the whole cloth. Of all tort claims in the United States of America, rather of all civil claims filed in the United States of America, tort represents 9 percent of all civil claims filed. Of the 9 percent of tort claims filed, product liability represents 4 percent of the 9 percent, or thirty-six one-hundredths. We are not talking about medical malpractice. We are not talking about businesses suing businesses. We are not talking about Securities and Exchange Commission suits and class actions. We are not talking about automobile wreck cases. We are not talking about any of those kinds of injury cases. We are talking solely about product liability. It is not a national problem. President Ford took this up starting back in 1976 with a special study commission, and after 4 years of findings, they found that the States were doing it. Sure enough, over the past 15 years, as I pointed out, 46 of the 50 States have just done that, they have upgraded, in a sense, their product liability laws. Now cometh the theme, so to speak, of the revolution of the Contract With America. I never heard so many Republican friends of mine quote Jefferson, but all of a sudden Thomas Jefferson has gotten very popular around here in Washington these days. ``That Government closest to the people is the best Government.'' So when it comes to welfare reform, block grant it back, give it to the States. When it comes to housing, give them the money. When it comes to the crime bill, eliminate the cops on the beat, give them block grants back there. The people back home know how to better spend the money. They have the better judgment at the local level. You would think that 12 jurors having sworn under oath to listen to the particular evidence would better be able to make a judgment in a case. But, no, no, not with this manufacturers' bill. Corporate America has come to the scam here and they come and say: ``No, wait a minute, we have to reverse fields and we have to bring this to Washington, and do not worry about it, Washington, we are really not going to get uniformity because we are not going to give you a Federal cause of action,'' which I have been debating for 15 years. If you believe it is a Federal problem, give us a Federal cause of action. They said: ``No, what we are going to do is give you Federal regulatory guidelines.'' That is what this whole body is up against--regulatory measures at the State level. Here with this bill we are going to heap it upon them. give it back to the local level. This whole body is all wound up about unfunded mandates here now. Come the end of April, we are going against the contract, and we are going to give them an unfunded mandate, and they know it. The whole body is saying that in welfare we have to make the recipient more responsible. Here we say that the manufacturer is not going to be responsible. We have all kinds of bars in here to protect the manufacturer. If you have any doubt about it, we will show you the section where the manufacturer itself is exempt from the bill. That is what we have going here with respect to product liability. We have serious problems in this country of ours. But torts, historically, under the English system for 200 some years, has been a matter of the jurisdiction of the States. They are trying to give meaning to the 10th amendment. When I go home and turn on C-SPAN, I see the speakers about the contract say we are going to give meaning to the 10th amendment. Those responsibilities, not delegated specifically under the Constitution to the Federal Government, shall be reserved to the States. Oh, no, they say, on this one, if we can put over this one--how do you put it over? When you get in a campaign, Mr. President, you know how they have been putting it over because I get it from the other side. They come to me, the National Association of Manufacturers, in my campaign over the last 15 years, elected three times. They say, ``Why do you not go along with this thing? We have product liability problems''. The chamber of commerce comes to you and the Business Roundtable members come to you, responsible civic leaders and all think there is a real problem. Why? Because Victor Schwartz, and the hired hands up here, a bunch of 60,000 lawyers, have been paid off. They say, ``Get ahold of that Senator and get a commitment from him because he has not committed.'' We tried to tell the business leaders, ``Look, wherein do you ever think that the National Congress in Washington, DC, is more conservative than your own legislature back in the State capital?'' I know from 40 years in government that temporarily, yes, you might have a more conservative government and group over in the House of Representatives. But give it a few more years and I can tell you from my experience up here, I would much rather have the State legislature find on this particular score. You might think you get temporary relief but in a few years, you will trip up on this rug and go up to the window and get your money. Business does not have a problem. The 232 risk managers under the Conference Board study showed that it was less than 1 percent of the cost of doing business. When they get to talking about competitiveness, competitiveness, competitiveness, I have to smile, because I have been in the game for years and I wish they would point out--and they cannot--that we have over 100 German industries--recently BMW, recently Hoffmann-La Roche, and over 50 Japanese industries, and I got the blue chip corporations of America that came to my home State. Not once have they said: ``What about this product liability? We need some kind of solution to it.'' The fine businesses that like and respect safety are willing to put it into the cost of the product and into the practices, with safety offices and everything else in these particular entities all over the United States. If you want safe manufacturing, you come to the United States of America. We take it for granted and we are about to strip it today and tomorrow and the next day, whenever we vote, trying our best to put in a fixed situation which is, frankly, an embarrassment to me having been on both sides of this particular problem in the courtroom representing businesses as well as representing injured parties. It is difficult, difficult, difficult in this day and age. You do not get runaway juries. They all know about insurance. They are very sophisticated. They have all good businesses. They know there is no free lunch. You have to prove by the greater weight of the evidence to all 12 jurors-- all 12. If you miss one, your case is over with; you get a mistrial and you have a hard time getting back into the courtroom and all that time your costs and all are going up. So in these civil claims of tort, if we want to get to the problem, let us go to the businesses suing businesses that have billions and billions of dollars, where these fellows sit around in the boardroom and say, ``I do not care, let us go to trial and let us show what we can do.'' I put in the Record here yesterday the most spurious of claims by different businesses for millions and billions of dollars, really, which says to me perhaps there is a problem. The most objective group--and if you had to characterize it, it could be characterized ``corporate''--is the American Bar Association. They have various divisions. The American Bar started really with the utilities and the railroad and other lawyers. They are the ones who had the money to go all the way to Chicago, all the way to New York or Los Angeles to a meeting. Working lawyers for individual clients never had that kind of money. They found out they were not represented. As a result, that is why you have ATLA, the American Trial Lawyers Association. I was in on the early days when it was organized. Now we have almost as many defense lawyers attend our ATLA conferences as plaintiff's lawyers. The defense lawyers come and learn and understand the various issues, the various demonstrative evidence that was started out years ago on the west coast by Lou Ashe and Mel Belli, and others, to keep a record, rather than an operation by ambush. Give everybody everything you have and say here is what I am going to prove. As a result, we have the Restatement of Torts and otherwise, and wonderful progress has been made in the field of law in the trial of cases over many, many years. That has been done at the State level. What happened as a result is that the American Bar Association, once again, for the sixth time, has opposed this bill. They have prepared testimony and testified against the bill. You have the American Bar Association; you have the Association of Law School Deans and Professors--over 121--opposing this as bad law. You have the National Conference of State Legislatures and the Conference of State Supreme Court Justices. We have the credibility and the concern of the responsible consumer groups and other wise individuals--the AFL-CIO and everyone else who really understands the plight of injured parties. They all oppose this as a bad, bad, bad, prejudicial kind of measure that should not be in the National Congress. If there is a problem, the States are handling it well. This is part of the contract. I hope that in this context these folks will keep their contract with the American people.

Mr. HOLLINGS. Mr. President, I send an amendment to the desk to the amendment of the Senator from Michigan and ask that the clerk report.

Mr. HOLLINGS. Mr. President, I ask for the yeas and nays on my amendment.

Mr. HOLLINGS. I thank the distinguished Chair. entering into this particular issue, and that is what I would call candor. The reason this issue has survived over 15 years but never passed the Senate, the reason it hasn't gotten anywhere is the antipathy to lawyers. And here in the middle of the treatment of product liability, a very restricted part of civil actions--you take all the civil actions in the United States filed, 9 percent of all civil actions filed comprise tort claims. And if you take all the tort claims filed, only 4 percent of the 9 percent comprise product liability. What you have is thirty-six one-hundredths of the civil actions being treated in product liability. But superimposed on top of that comes the first amendment, and the first amendment is: ``Kill all the lawyers,'' they said in King Henry VI, Shakespeare. We will kill all the lawyers here. We have the disclosure of attorneys fees and information. They take an anecdotal measure that they refer to in the newspaper relative to antitrust, having nothing to do with product liability, and they put in an antitrust charge which is no doubt a class action--not class action on product liability--and a class action that has been conducted over the many years. I have to go back and find out what it was. Quite to the point, the $16 million, with the inference here, they do not tell you how many millions went to the claimants. Obviously, millions went to the claimants, but when you had thousands and thousands of claimants, maybe millions of claimants, then it did reduce it to a $10 to $25 redeemable toward the purchase of an airline ticket. Those things come out when you get the full facts. But this anecdotal approach, and taken with all civil cases in Federal court and putting down lawyers' disclosure amounts gets to the candor that really is behind the movement here at hand. Product liability has been handled at the State level and in a very judicious and forceful fashion. We know it is not a national problem. All the little things that they tried to bring up over the years-- incidentally, Mr. President, by way of amusement to this Senator, I remember when they brought up the Little League, and the Little League had the right and said, no, no, we are not a part of this case. Then they had an anecdotal amount of Girl Scout cookies and they had the right and said, no, we are not into this at all. Then our former colleague who, incidentally, sat right here in the Senate, the Senator from South Dakota, George McGovern, was on a little TV expose, how he went out of business on account of product liability, and then he reversed field and said, no, no, they had cut that particular little 30-second bite that they had him and former Congressman and then Secretary Jack Kemp on, which they were trying to build up. They tried every amusing thing in the world to give some force and credence to our product liability problem. There is none. There is no national problem in product liability. Now if we cannot get the votes for that, then what we ought to do is get lawyers fees here and call it disclosure, like the lawyers are running around cheating their clients. Come on. If the lawyers do that, they are not going to last long. I do not know what town they practice in, but reputation means everything in the profession. Oh, yes, we object to doctors and doctors' fees and everything else, until we get sick, and then we want the best and we love our doctors. In a similar fashion, yes, they all complain about the lawyers, until they get in trouble and then they get a lawyer of their choice and have complete trust. Like I say, at the bar we require a minimum fee kind of schedule and contract, and the lawyers of the local bar associations police their groups. And, yes, there are many cases being brought up now before our State supreme court for malpractice, disbarment, and everything else of that kind, where they have taken the client's money. But that was not because they did not disclose. You are going to find those kinds of lawyers and those kind of individuals in every practice, profession, trade, or business. It is unfortunate, but you certainly do not need here at the Federal level to try and burden product liability with a lawyer fee act. But if we are going to do it, let us get to the real heart of the matter, because there is a cleavage of division. When, Mr. President, I work for you as my client, I do not get paid until I succeed and you understand the percentage or the contingent basis. If I go to you under billable hours, in addition to trying to win your case, I am trying to win myself more fees, and on a billable hour basis, the more I can say that I worked on Saturday and I spent some hours reading here and I looked there and everything else--in other words, I am trying my case and not the client's case. I think that is unethical. I think it is basically unethical. There are a lot of things that I think are unethical. Perhaps our conference that we have around here every Tuesday trying to ambush each other is. We never had that before. We had policy committees. As the distinguished Parliamentarian who has been here for years knows, the policy committee set the seriatim of the treatment of measures. But we never had parties meeting, the Republican conference and the Democratic conference, to meet in ambush of the other side and come around here and talk about ethics. When you get these billable hours, you begin to work for your billable hours, you begin to work for your case rather than the client's case. I never did like it. I never charged billable hours. I resent it and reject it. But if we are going to have it, let us limit it because it is unforgivable what they are trying to charge. If that is what the market forces are, I never heard of all the hours charged. Look at the O.J. Simpson case, what they say those high-powered lawyers are charging. Maybe we can have a hearing before the Judiciary Committee and find out. I know we have not had any hearings on this. The product liability measure was referred to the Commerce Committee and there was not one word of testimony on this matter. That made me withhold the matter of lawyers fees. I was waiting for somebody to raise the subject of let us get the lawyers. Now that it has been raised in the Abraham-McConnell amendment, I have to amend that amendment with my particular one of a limitation of $50, at the most, on any billable hours. As I pointed out, I am confident that the anecdotal antitrust case-- not a product liability case--would reduce the $16 million. Oh, that would reduce it down to $2 or $3 million. So we are moving in the right direction in the Hollings amendment. But more than that, I would challenge those who sponsored this amendment to bring me the product liability case wherein the claimant represented by an attorney was misled, misinformed, or not disclosed fully what the fee basis was. I do not know of any. I never have heard of any. I cannot understand it. Maybe it happened here in this antitrust case. But if that is what they are disturbed about, do not just reach around in a magazine article having nothing to do with product liability or reach around in a newspaper article in the Washington Post having to do with antitrust and a class action brought over a series of years and court approved that we do not have the facts for, having nothing to do with product liability. I want to ask them to please bring--if that is their intent now on disclosure--evidence of where it is a national problem. Heavens above, we have enough work to do around here. But if we are going to start debating lawyer's fees at the national level, and disclosures, and how many hours, and what do you expect, and how many hours on settlement, and how many hours on trial, and then the actual fee per hour charge, regardless of how the fee was structured, and all of these things of that kind, this is a solution looking for a problem. What the real problem is, is lawyers. So they say we can enhance this product liability initiative by going at lawyers. And we will find out who is for lawyers and against lawyers. Well, I happen to be for lawyers. We will have to get that saying of ``kill all the lawyers.'' But that was really a laudatory comment, whereby lawyers stand between tyranny and freedom. In Shakespeare, you will find that reference with respect to lawyers not being against all the lawyers, but the continue this tyranny is to get the lawyers because they are the only ones that understand and know and stand in our way of freedom, and we can continue this tyranny. So it was not a pejorative saying of ``kill all the lawyers.'' We can go through to the Founding Fathers who were all lawyers and drew the Constitution and worked at it overnight. We can come right on down the line with respect to the lawyers in the history of this land, whether it be President Lincoln in the days during the Civil War, or most recently here, in civil rights cases, Thurgood Marshall and others. If they had not had those lawyers, I can tell you now, having been at the local level over the many years, had Thurgood Marshall not succeeded in Brown versus Board of Education, you would not have found the advancements made. Advancements were not made as a result of the Civil Rights Act of 1964 so much as the advancement made in the 1954 Brown versus Board of Education decision by the U.S. Supreme Court, brought by the trial lawyer for the NAACP, Thurgood Marshall. I will bring the cases, when we have time, to the attention of my colleagues. The hour is late and I want to yield to others to be heard on this. Since it has just come up, I have represented to the distinguished manager of the bill, it is not our intent to delay. We will survey colleagues on this side of the aisle and see what amendments they want to present. I want to see if there are those who want to talk on this particular measure before we vote. And pending that, Mr. President, I yield the floor. I suggest the absence of a quorum.

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

Mr. HOLLINGS. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, on the matter of the extremism which the distinguished Senator from Montana so thoughtfully addressed, I want to just address the environment; not necessarily the extremists, not the hate groups--I want to address our conduct, namely the public servants. We read in the morning's paper, for example, where David Broder uses that description of this Government here in Washington, the greatest gift to free people the world around, a representative form of government that works so well--he uses the words of our distinguished Speaker, ``the corrupt liberal welfare state.'' You know Mr. Gingrich is not going to blow up any buildings and neither is Senator Hollings. But what has come from my experience is a reaction against this particular environment, because it is created by pollster politics. I ran for 20 years without ever seeing a political poll. You addressed the issues as concern the citizenry, going down the Main Street, out into the farms, the rural areas, the small towns, as well as the civic club meetings in the cities. You had a feel for what is going on. But that is not allowed today in the pollster world. What you do is you take a poll, find out what they call the six or seven hot button issues, and take the popular side of those particular issues and blame everybody else. Specifically, if you want to run for office up here in Washington, it has gotten to an environment of running against the Government. This is sheer nonsense, but this is the fact. I think we are elected to make this Government work. The approach of the environment, under the contract and otherwise, is to get rid of the Government, dismantle it. It is not needed. Cut the money so they cannot do the job or whatever else it is. But as long as you can run against the Government, with the cry, ``The Government is not the solution, the Government is the problem,'' that is the problem I wish to address here. Because all the attention and editorials will now go with respect to the hate groups. Unfortunately, they have prospered over the past 15 years. I was inaugurated as Governor of South Carolina in 1959. After I took the oath of office, I ran back up the steps to get on different clothes for the parade. I looked on my desk and I found a green envelope, gold embossed, from the Ku Klux Klan, Grand Klavern of America, giving me a lifetime membership. Well, I was lawyer enough. I said, ``We are going to return that with a return receipt requested.'' But I asked for the head of my law enforcement division, Mr. Pete Strom, I said, ``Have him here at the end of the parade. I want to see about this.'' At the end of the parade, I asked Chief Strom. I said, ``We have the Klan in South Carolina?'' I was down in Charleston, and we did not have that activity in the city of Charleston, not that we were any better than any part of the State. But he says, ``Yes. We got 16,721 members.'' I said, ``You keep a count?'' He said, ``Yes. We keep a count of them but none of the Governors wanted to do anything.'' I said, ``Do anything?'' He said, ``Yes. Get rid of the crowd.'' I said, ``Well, I agree with you. We ought to get rid of them. What do you need?'' He said, ``I need your cooperation. If you can get me a little money for informant fees, if you can help me infiltrate this group, we will get rid of them.'' And at the end of my 4-year term we integrated now Clemson University--then Clemson College--without incident, because we were able to bring it down from 16,721 to less than probably 200. In fact, they told me. I did not know about any meetings. But some of my informants were called in the meetings and informing and everything else, and we dispelled the Klan from South Carolina. But unfortunately, Mr. President, that now has grown back. When they talk, and write in erudite fashion in the morning news, do not worry about this violence and racism, that we had it back in the 1920's. Do not give me the 1920's. Let us go back just 30 years ago or 40 years ago, from 1954 with the Brown against the Board of Education decision and come on up 40 years to 1994. I can tell you categorically we have more racism today in my home State than we had at that particular time. This environment really bothers me in the context of what I experienced back home just this past Easter break. We had an annual meeting of our State Chamber of Commerce. To that meeting I was invited, of course, the two Senators, and the six Congressmen. Most of us, of course, were in attendance and we answered the questions. One of our distinguished Congressman had gotten on to the matter of the abolition of, getting rid of, closing down the departments of Government. I was just sort of taken aghast. But I thought I would hit them right head on. When my turn came, I said, ``Wait a minute. You folks are talking now of abolishing the Department of Commerce?'' Here I am meeting with the State Chamber of Commerce, and I could see the faces light up, and they started almost clapping saying, yes. I said, ``The Department of Commerce, Education?'' We had former Governor, is the Secretary of Education up here now. They said, yes, yes. They got even louder. I said, ``Energy, and HUD?'' Yes. They were almost standing up cheering. They were almost standing up cheering. Let us do not talk of the extreme. That is easy to address. Let us talk of the responsibility of middle America. Everybody wants to buy the vote around here of middle America. We are it. We are middle America and we are developing that attitude of dismantling it and getting rid of the very thing we are supposed to build and represent to respond to. We certainly are not responding by paying for any bills. I fought that, now years on end, trying to get fiscal responsibility. But I want to emphasize that my feeling is not just on account of the disaster in Oklahoma, which I think is reflective. When we set up the environment of that kind, then extremism can prosper. I saw it in 1963 under our hero John Fitzgerald Kennedy. I will never forget at that particular time the anti-Kennedy environment that persisted. I have never thought anyone was more eloquent, more intelligent, more dynamic than John Fitzgerald Kennedy. And he did attract in a sense the best and the brightest to our Government at $1 a year and we had things moving. But an environment had developed somewhat similar to this environment today that I feel when I go to these meetings and see these reactions-- President Kennedy was about as popular as an itch. I can tell you here and now when the news came over that he had been assassinated, public schoolchildren in my backyard stood and clapped. We are responsible--not the extreme groups--we in Government are responsible for these responses, with this kind of environment, and this kind of feel amongst the people. Yes. The talk show hosts. Good heavens above. They cannot plead not guilty now. They are as guilty as get out. They have talked of arms and shooting. And, yes, this morning as they talk now they refer to ourselves up here as the corrupt liberal welfare state. They have got all the buzzwords. The Republican Party gives instructions on using the proper buzzwords. The Senator from North Dakota put that in the Congressional Record. We know those particular buzzwords, and they will tell you to use those buzzwords because that fires up the people and engenders support for your particular position. That is what has been going on, to my dismay. I felt after the election in November that rather than a Contract With America, that what we needed was a challenge. Rather than reinventing Government, we needed to restart it. After all, we had 12 years of Reagan-Bush, and Heaven knows they had cut enough spending, except in the field, of course, of defense. We had cut, cut, cut--this minute with even further cuts, 50 percent of WIC, 50 percent of Head Start, 50 percent of title I for the disadvantaged. All of those have been not embellished and fleshed out to their fulfillment whereby we save money--$3 for every $1 invested in WIC, $4.50 for every $1 invested in Head Start, $6.50 for every $1 invested in title I for the disadvantaged. Yes, health research has been cut. We saved $13.50 for every $1 we invest there. Some were talking about the flu. I just was reading David McCullough's book on Truman, and after World War I; 1918, 1919. We had 500,000 deaths from a flu epidemic, more than was killed in World War I. We had 25,000 GI's in camp that never got to war that died as a result of the flu. With problematic research, we have saved those lives, and the report now is we have less than 5,000 here in the year 1994, or 1995, the most recent figures. So we save and we ought to understand by investing in education, investing in these various programs, we actually are saving money. But the drumbeat to election has gotten so that there is a total disrespect for anybody that serves in public office almost today, and particularly at the Washington level. I thought with the problems that we had what needed to be done is a challenge for America in the context of a Marshall plan on the one hand, and a competitive trade policy on the other hand. Specifically, as we started the year, we have 39.9 million in poverty in the United States of America, and that has not diminished. We have over 10 million homeless on the sidewalks tonight when you are on the way home. We have 12 million children going hungry. We have 39 million without health care. Those who have a full-time job are making 20 percent less than what they were making 20 years ago. According to the census figures last year, that is the groups from 17 to 24--73 percent of that age group cannot find a job or they cannot find a job out of poverty. And with our lack of a trade policy whereby 10 percent of manufactured goods, back in 1970, 25 years ago, only 10 percent of manufactured goods consumed in your and my United States represented imports; now over 50 percent. If we had gone back in the last few minutes or as of today back to the 10 percent, that is 10 million manufacturing jobs. We are going out of business. We are headed the way of England. As they told the Brits some years back, ``Don't worry; instead of a nation of brawn, we are going to be a nation of brains, and instead of producing products, we are going to provide services and have a service economy. Instead of creating wealth, we are going to handle it and be a financing center.'' And England has gone to hell in an economic handbasket. When you lose your economic power, Mr. President, you lose your power in foreign relations. As of today, we are not the biggest contributor to foreign aid. Japan is the biggest contributor. They are holding the schools on Fredrich List, the Japanese model, whereby the wealth of the economy is measured not by what it can buy but by what it can produce and the decision is not based on be fair, be fair, level-the-field nonsense. It is whether the decision strengthens or weakens the economy. And this is the competition we have in the Pacific rim, and even now the emerging nations in Eastern Europe are not adopting the free trade of Adam Smith and David Ricardo but, rather, following the Fredrich List model, and that is the competition we have to wake up to. So I thought the first order of business now with the fall of the Wall was that we could start rebuilding this land and we are immediately going to the distinguished President George Bush, who, in his State of the Union, said we have got more will than wallet. False. We have got more wallet than will. I can tell you that. We have the money. We are spending it $1 billion a day for interest costs, for nothing. We are wasting it. If they want to get a Grace Commission--and I was very sorry to see my friend passing here, Peter Grace, who headed up that Commission, just this last week. I served on that Commission, and he acted with tremendous distinction for the good of the Government here in Washington. But if you want to get waste, fraud and abuse, the biggest we have-- and nobody wants to talk about it--is the increase of the debt. And all you need to do, if you want to find out what the real deficit is, is see what the debt was in 1994, what it is going to be in 1995--we will go backward--and what it was in, say, 1990 and how much it increased in 1991, and then in 1991, how it increased in 1992. And you can see, not of this structural debt or other kind of debt that they describe, but you can see we are spending on an average of $300 billion more than we are taking in. That is the deficit as I see it. In January, they estimated $338 billion, but we have had six increases in the interest rate since that time. So it is going to be $350-some billion no doubt--$1 billion a day--and we are into a downward spiral. You can have all the freezes, and I favor them. You can have all the spending cuts, and I favor them. I absolutely oppose any tax cut. We do not have the money to cut. I can tell you that now. But that is buying the vote, the pollster will tell you, not only to use the pejorative terms but to come out for middle America. That is what distresses me. The leadership of the Republicans and the leadership of the Democrats are both talking about middle-class bills of rights and buying that vote and leaving us who have been in Government and trying to work to get us operating in the black and get this Government going again scrambling back to the environment. We can put in a value added tax along with spending freezes, along with spending cuts, along with closure of increase. I knew in my heart--and I can see Howard Baker there, the leader back in 1981, 1982 when we talked about a freeze. In 1981, Howard turned to me and he said, ``Now, Fritz, I can't come out and endorse it, but we are going to have to get on top of this. We are going up to the hundred billion deficit.'' We never had had that before. We do not even blink at the $300 and $400 billion deficits that we are having today. He said, ``You come out with your freeze, and I will support it in the context of I will say, `Well, that is interesting; let's study it and let's see if we can go from there.''' And when I did, the next morning Don Regan, the Secretary of Treasury, tackled us from behind and said, ``No way; we are not going to do that.'' And as a result the rest is history. Under President Reagan, we got the $100 billion deficit, the first $200 billion deficit. Under President Bush, we got the first $300 billion deficit and the first $400 billion deficit. Now, yes, President Clinton came to town and cut $500 billion in spending. He taxed Social Security. He taxed cigarettes. He taxed liquor. He taxed gasoline. He let go some 100,000 Federal employees, and he was on the right track until November when the contract now is the attention, almost like spectator sport up here. And so it is Annie get your gun; anything you can do, I can do better. We are not really talking in terms of substance. We are only talking in terms of symbols. You can adopt the Contract With America in the next 10 minutes and not a single bill is paid and not a single job is created. So if we could put in the Marshall Plan and start investing in people--we are talking about putting people first--if we can go back to the theme upon which the distinguished President was elected and then turn to a competitive trade policy, we can start rebuilding our economy and our strength and thereby our influence. Our foreign policy and security as a nation is like a three-legged stool. You have the one leg of the values of the country, and we feed the hungry in Somalia; we build democracy in Haiti. We have the second leg unquestioned there, too, that of the military. The third leg, the economic leg, has been fractured, intentionally so, over the past 45 years with the special relationship that we had to support the fight of the cold war against communism. But now with the fall of the Wall, it is our opportunity not to dismantle the Government but to rebuild the Government, not to reinvent the Government but to rebuild it. I ask unanimous consent, Mr. President, that ``Perspective--Challenge for the New America,'' be printed in the Record.

Mr. HOLLINGS. Let me just read this because this is what we had in mind and spoke of back right after they submitted the contract and talked about in November so reverently, and I read now because I do not want people now to think I am joining the comments with respect to extremism. I do not differ with them. I salute the distinguished Senator from Montana, the Senator from Minnesota and others, but I read because we have got to give the people hope in this environment. And I read this. The United States is a can-do country. Since the beginning, it has always looked to the people's government in Washington to lead the way. And today, as spiraling deficits and free trade threaten our standard of living, our challenge is to use Government to get out of this mess. Look how successful we have been. It was the Washington government that enacted the land ordinances that opened the West to pioneers. The Washington government built the roads, canals, harbors and transcontinental railroad that poured our rich resources into the factories. The Washington Government produced the water projects that transformed the Midwest desert into the breadbasket of the world. It was the Washington Government that brought electricity to rural America. When free enterprise failed in the Depression, the Washington Government lifted us from despair and rebuilt our economy. The Washington Government saved the world from fascism. The Washington Government broke the back of racial discrimination and set us on the road to equal justice. And it was the Washington Government that joined science, industry and education and put a man on the Moon. We can repeat our past successes. Enough of this chant to get rid of the Government. As John Adams said, ``The declaration of hostility by a people to a Government made by themselves for themselves and conducted by themselves is an insult.'' I yield the floor. loud and angry voices

Mr. HOLLINGS

Mr. HOLLINGS. I ask unanimous consent that the privilege of the floor be granted to the following members of the Senators staffs. I send the list to the desk.

Mr. HOLLINGS. In 1986, the producer of Minute Maid Orange Juice, Coca-Cola, sued Procter & Gamble, charging that ads for Citrus Hills Select falsely claimed that the juice was made from the heart--heart-- of the orange. In 1982, McDonald's sought a temporary restraining order to prevent the airing of ads comparing McDonald's Big Mac unfavorably with the Burger King's Whopper. Come on. Is that what we are going to consider? We have work to do up here. The plea here about the interstate commerce clause, taken at the Senator's insistence, just repeals the 10th amendment and the responsibility of the several States for tort litigation. I agree with him. I agree with him. Let us extend the interstate commerce clause. But let us extend it to insurance companies which are, all of them, engaged in interstate commerce. I had one, an insurance company before the Securities and Exchange Commission. I guess the year was around 1960 or 1961. I know Manny Cohen was the Chairman of the Securities and Exchange Commission. And I asked that that company be able to operate in several States. I got it approved in 13 days. I know about interstate commerce and insurance. I can tell you here and now, you put in a bill--if you want to see the insurance lawyers all fill up that hall outside, put in there, under the interstate States of America, and say, ``Quit having to file your policies and hire lawyers racing around to the capitals of 50 States, every one of your policies must be justified and administered in that particular State under that particular law; what we are going to have is uniformity. We are going to have a Federal Insurance Commission.'' Oh boy, talk about acting under the interstate commerce clause--you will see them fight it. We have to expose this fraud that has been going on for 14 to 15 years. Jerry Ford was right. President Ford put it to the study commission and he said leave it to the States. In the 15-year period, the States have all acted and they have revised their laws and come up with responsible provisions as time evolves with respect to the conduct of product liability litigation. But it is certainly not a national problem. This thing about competitiveness, it is just totally out of whole cloth. I have been in the game, and we can name the industries, one after the other. Not long ago, I was at Bosch, which is a German company that is located just outside of my hometown of Charleston, SC. They have a 10-year contract to make the antilock brakes for all the General Motors cars. They make the antilock brakes for the Toyota; they make the antilock brakes for the Mercedes-Benz--foreign cars as well as domestic. When you go in to inspect their plant, they put covering over your shoes and a smock all the way around that you have to wear over your clothing, and a headpiece to make sure no dust or any kind of solutions come from your hair into their particular product. In fact, it is much like going through a pharmaceutical company, or film. Incidentally, I got Fuji Film in South Carolina, and Fuji Film from Japan is now doubling the size of their plant. They have had one there for the last 10 years. Now they are doubling the size. They are not worried about product liability. But I turn to the Bosch man--because we are awfully proud. I put in a system for technical training and have expanded upon it by sending my teams, having graduated, to Munich, Germany, where they--in this particular case, Stuttgart--go over the German apprenticeship system and then instruct the employees in the German apprenticeship system in my own backyard. I know about productivity. I said to the gentleman who is the head of Bosch there, ``What about product liability?'' He said, ``Senator, what is that?'' I said, ``Product liability claims; have you had any claims against any of these antilock brakes for defective brakes?'' ``Oh, no, no,'' he said. ``We have never had a claim.'' He said, ``If we did--'' he reached over and pulled one off the line. He said, ``Do you see this little number?'' He said, ``We mark every one of those brakes on every wheel on a car. We have a number. We would know immediately, if there was a defect, where it comes from.'' That, Mr. President, is the quality production that has been brought about by trial lawyers. They can cuss them; they can fuss. They can talk about getting the fees. These cases read by the distinguished Senator from Utah, the two cases he had, one in New York, for the supermarket; and in New Jersey, for McDonald's--those lawyers did not get a red cent. They wasted 3 years in time. Lawyers do make mistakes. I guess they made a mistake. But do not put that down as a reason for nationalization of product liability up here at the Washington level. What happens here is that we have quality production. Companies have come south to my State, having learned you have to really be outgoing toward your employee force--I have watched with a certain amusement over the years, where we called them workers; then we called them employees; now we have to call them associates. You do not dare refer to the work force other than as associates. Rather than the head of the plant parking right up at the front door, they have the Associate of the Month. He parks up at the front door, or she parks up at the front door, and the manager of the plant parks way down in the boondocks. They know how to do it. When they eat--and I have eaten in these restaurants; they do not have a Senators' eating place, and the regular folks eating otherwise, like we have here. Oh, no; this is not on productivity up here. They all eat in the same restaurant. Yes, we know about productivity. All of that has come about by not only the treatment of the work force on the one hand, but the absolute care that has come about in relation to the Occupational Safety and Health Act: safe machinery; safe working place; and, yes, the assumption that the product, for whatever particular use it is designated, is going to be a safe product. We can count on that. That housewife does not have to run home and test it on her children and see if it is going to blow up in their faces or make them sick or any of those other things. We count on it in our society and it has worked and is working, and is working well. To come now with this charade here that has been going on for 14 years, because they can grab us Senators up in campaigns and say, ``Are you for or against product liability?'' and get 15 organizations, the Business Roundtable, the chamber of commerce, and they are all coming in and saying, ``Are you going to be for that product liability?'' Product liability? You are interested in votes, and trying to move on and get something done. And so, yes, you say so, and that ends that. And I am having to talk against a fixed jury. But I hope some of them are listening and someone will engage in the debate as we have over the past 15 years so that we can hold up this bad mistake. Because if we make this mistake relative to product liability, then we should federalize medical malpractice; we should federalize automobile wreck cases; we should federalize the whole thing. Then we will have to build some more courthouses. I think we just cut the construction money for courthouses. But let us--in the name of trying to bring down the size of the Government here in Washington, and the bureaucracy--let us build some more courthouses. Let us get some more Federal judges. We can all give them a lifetime job, we Senators. And we can have more clerks of court. Man, I am telling you, we have a growth industry up here. The best way I know to get this growth industry going is to federalize product liability. It is a sham. It is a bad mistake. The American Bar Association opposes it absolutely. They came up again and testified against it. All the different consumer organizations are against it. Yet the sponsors come here and act like they are for the consumers. They know differently. The State legislatures that handle this problem, the Conference of State Legislatures, testified against it; the Conference of State Supreme Court Justices is against it. Later on I will include in the Record more than 100 deans and law professors from over the entire country who will go into detail and analyze this particular bill, and show how instead of this really giving uniformity it gives complexity, and how, instead of saving money and the procedures and the bureaucracy, it increases it. And if they have such a thing as the lawyers' full employment act, this would be the one because you have all kinds of motions to make now under this particular bill and meetings to be had, and everything else of that kind at the Federal level and at the State level. It is just fundamentally flawed; bad law. They know it, and they try to doctor it up so they can get this into a particular conference committee. And then, of course, go right into what they call the English rule that they have over in the House bill. That really shows how garish this Congress can get; to take a system where people without means can have their day in court in civil litigation and now are going to be denied, which I myself have taken on as a trial lawyer. Let me divert for a second. Let me say I represented the bus company or the South Carolina Electric and Gas. So I represented the defendant in numerous cases of tort claims as well as plaintiff. But tell the average citizen who cannot pay for billable hours, and tell them they have no claim? And, yes. We had the contingent basis whereby, as I reiterated and I reiterate because I cannot emphasize it too much, I take on the cost as a the interrogatories, for the discovery proceedings, for the actual trial, the settlement, conferences that we had, the actual trial of the case, the appeal, the printing of the briefs, the appearances, the entire time spent. Yes. These cases take--in serious cases--2 or 3 years to get them finally determined. This trial lawyer assumes all of those costs. If I win, I get a third. If I lose, I get nothing. I paid those costs. That is the system that has worked. If you are going to have the loser pay all, I am going to say, ``Now, wait a minute. I have a wife and children. Now I have grandchildren. I like to help. But unless you can get me a bargain and assume the cost, I cannot go totally broke in this business. I have to have you take care of the costs in case we don't prevail. I think you have better than an even chance to prevail.'' However, I never can tell in the draw of a jury. That is what Judge Ito is having to deal with now, the mindset of jurors. I cannot tell the mindset. They could come in with selection of a jury, and I not know it and they have some peculiar feel or prejudice, and I get 11 but I do not get that 12th juror. I end up losing the case, and I have to pay it all. I think that at least you ought to be able to take care of your costs if you believe in your case that much. Yes. That is the day in court, the trial jury. The distinguished Senator from Washington says they all get their trial by jury. But you read this bill based on what evidence can be submitted, you read the test to be used and the thrust that they have and how they allocate some of these provisions not to manufacturers. You can read on page 36, line 7, ``actions excluded.'' Here is the unmitigated gall of this draftsmanship. Actions for damage to product or commercial loss, a civil action brought for loss of, or damage to, a product itself, or for commercial loss, shall not be subject to the provisions of this title governing product liability actions but shall be subject to any applicable commercial or contract law. The States have their volition as to the Uniform Commercial Code and how much and how they interpret it. They have their volition in the 50 States as to contract law. Yes. When it comes to manufacturers under this particular section, yes. We believe in States' rights there. But when it comes to injured parties, you do as we say to do. They talk about a fair and balanced reasonable bill. Come on. They know better. They can read. We pointed this out at the hearings. They had no excuse for it. We pointed it out at the markup. They continue to insist upon it, and we will have amendments. We will have to come along I guess, if they get cloture because they do not want to have debate. They will have to have these amendments and we will have to vote on them. But I think the original document itself is a pretty good example of what they have in mind. It is not a balanced bill. They had no caps heretofore in previous Congresses on punitive damages. They have it in this one. They say they are going in a reasonable fashion, a more restrictive fashion. They have the misuse provision in here now that they never had before in the three previous Congresses. We will be able to go down on those things and see if they want to insist upon them. But I can tell you what we ought to do, in this Senator's opinion, is table this bill and move on to those problems that are national problems. The State of Idaho is looking out for its people. It has a Governor. It has a legislature. It has juries that are sworn to listen to the facts and bring in a verdict in accordance with the facts. It has the option of the trial judge to set aside punitive damages, to restrict the actual damages. I am sure the States of Idaho, South Carolina, and Washington would much rather have its law than a national law up here wherein they think, yes, with the Contract With America crowd in town, that we are going to start being conservative. I can tell you here and now, that might last for a little while. But after a few years go you are going to find the liberal National Government--which has been persistent throughout the years as compared to the State government, State law, and State practices in tort, and with respect to criminal law and otherwise--you are going to find there is a much more conservative government at the State level, and more responsible in my opinion, than the National Government. We do not have a national problem. That is the point. Yet. They have really been on a roll up here for big industry and against the individuals. They know how to handle the lawyers downtown. I hope to have perhaps an amendment on the interests of companies. Perhaps we ought to have that, and maybe some of my distinguished colleagues would like to sponsor an amendment on billable hours in addition to caps on punitive damages. Let us have caps on billable hours here in this town. Let us see if that lawyer crowd that is out trying to fix the U.S. Senate can go back to work and try their cases in court before a jury of 12 jurors without meddling with the State precedents here in the United States. I yield the floor. Mr. GORTON addressed the Chair.

Mr. HOLLINGS. Mr. President, that goes right to the heart of what they are really concerned about. They are concerned about these manufacturers making more money. They are not concerned about punitive damages. If they were concerned about punitive damages--and we will list, when we have more of the Senators in town here that are not present here on this Monday afternoon, we will list the punitive damage awards with respect to these corporations suing corporations. My understanding of punitive damages is willful misconduct. But if there is an abuse of the awards of punitive damages to justify this national concern, it would be at the manufacturer or the business or the contract level, not that of individuals injured on account of the defective product bringing their cases in tort for product liability. There is no question about it. Now, the distinguished Senator points out how he is concerned about consumers. He says this money goes to consumers, consumers, consumers. I refer to the distinguished chairman of our Judiciary Committee, the Senator from Utah, my good friend, for whom I have the greatest regard. We have listed and already put into the Record certain organizations, and among those organizations opposing S. 565, is the American Council on Consumer Awareness, the Arizona Consumers Council, the Coalition for Consumer Rights, the Consumer Federation of America, Consumer Federation of California, Consumers for Civil Justice, Consumers League of New Jersey, Consumer Protection Association, Consumers Union, Florida Consumer Action Network, Massachusetts Consumer Association, Michigan Consumer Federation, the National Consumers League, the New York Consumer Assembly, the Oregon Consumer League, Pennsylvania Citizens Consumer Council, and it goes right on down to Virginia Citizens Consumer Council. I can keep reading on and on. Every responsible consumer organization in this country opposes this bill. So we should not say that we are trying to protect consumers with this particular measure. The sponsors are trying to make more money for the manufacturer. They are not looking after consumers. Consumers know differently. As the distinguished Senator from Utah points out in his studied presentation, in the prepared comments--I know, as the Senator knows, how we get these prepared comments. Senators tell the staff--and he has a Judiciary Committee staff and a personal staff--``Get out and find the most horrendous cases. I want to take these trial lawyers and put them to rout, and I want to find the most egregious kind of claims that can be thought of so in my prepared remarks I can show there is a national need.'' Heavens above, look what he comes up with. If I try a law case I would win before a fair jury. This is a fixed jury, the U.S. Senate, Mr. President. This jury is fixed. We have 60,000 lawyers downtown here--billable hours--they come in and lobby for fixes. But if I had an unfettered jury and found out that the best of the best, the chairman of our Judiciary Committee, that conducted hearings, came up with the milk shake case of 1994 and found out it went all the way to the Supreme Court of New Jersey against McDonald's, and they were vindicated, that tells me that there is an incompetent lawyer or he has nothing else to do. I know unless I have a pretty good, strong case, I am not going to be bringing suits and appealing all the way about ``a milk shake that popped the top open as I put it between my legs as I drove off from McDonald's.'' I have real work to do. That case is in my favor. That shows the law is working, and it is working in the State of New Jersey. One other case he had, and that was a New York State case in 1989, and again the defendant was vindicated. Now, is that the best they can bring to the U.S. Senate on a national need? Come on here, we can cite cases like contracts, if we want to. We will list a few of them. We have that, if that is the basis on which they want to argue. Here in 1989 Uncle Ben's sued General Foods over advertisements claiming that Minute Rice outperformed Uncle Ben's in the slotted spoon test. In 1989, Walt Disney Co. sued to force a public apology from the Academy of Motion Pictures, Arts, and Sciences, for an unflattering representation of Snow White in the opening sequence of the 1989 Academy Awards ceremony. In 1987, Kellogg filed a $100 million suit against General Mills arguing that Post natural raisin bran was not natural as advertised because it is coated with coconut oil and that comparative television ads were misleading because ``extraneous material that would cling to the raisins had been cleaned off.'' Here is Kellogg suing General Mills. People here are talking about individuals bringing ridiculous suits--look at these cases here. I think we ought to look at these manufacturers. Mr. CRAIG assumed the chair.

Mr. HOLLINGS. Mr. President, what you have is, as the Senator from Washington just talked about, punitive damages. You have a procedure whereby you might have willful misconduct, but under this particular section, 107(2): Inadmissibility of evidence relative only to a claim of punitive damages in a proceeding concerning compensatory damages. If either party requests a separate proceeding under paragraph (1), in any proceeding to determine whether the claimant may be awarded compensatory damages, any evidence that is relevant only to the claim of punitive damages as determined by applicable State law, shall be inadmissible. That tells you they have really worked this measure over, and they want to keep out the evidence in the regular trial of a case of willful misconduct. They want to keep that out of the attention of the jury hearing the case. Right to the point of punitive damages, Mr. President. I have listened to Jonathan S. Massey, an attorney who testified in our recent hearings as having handled punitive damage awards before the U.S. Supreme Court. I asked him, ``You know, I was just thinking that the award of punitive damages in the Pennzoil versus Texaco case of $3 billion in punitive damages, how did that compare to all product liability cases?'' Just go back 30 years to 1965 and see what we really can find out. I ask unanimous consent to have printed in the Record a letter to me, along with punitive damage awards from 1965 to the present.

Mr. HOLLINGS

Mr. HOLLINGS. Mr. President, there are over 100 of these organizations all over the country, not only the trial advocates, of course, but the consumer organizations, the AFL-CIO, the working people and everything else of that kind. I will dwell, later on, on what good has really come of product liability. We never hear that. We act like it is one of the most torturous things in the world. The truth is that under product liability the using public here in the United States of America can pretty well count on the safety of particular products. What happens in rare cases, and they are rare ones, is that something goes wrong--with respect to medical devices, the Dalkon shield and the different other devices of that kind; the Pinto case. I can tell you, the other day 4 million Chrysler minivans were pulled off the market to change the back door switch. That multimillion-dollar effort on behalf of the traveling public in America was certainly not brought about by the National Association of Manufacturers or the chamber of commerce or the Business Roundtable. It was as a result of the product liability system that we have in America. The sponsors could not produce a Governor. I was waiting at the hearing for a Governor to come in and say we need a national law. The truth is that 46 of the 50 States over the last 15 years have treated their particular problems. In my State they debated it. They got together, not only with the chamber of commerce and the trial lawyers, but the insurance companies and all other business groups, consumer groups, and they worked out upgrading, as they thought needed to be done, the State law on product liability in South Carolina. Now we are going to come and say, ``Well, you did not know what you were doing. We know best up here. In fact we do not have any work to do. We are going to meddle into your State entity under the 10th amendment here that which has historically been under the States. We are going to want it handled still by the States, but with our guidelines.'' Heavens above, to come at this particular hour here, right at the so- called climax of the Contract With America, based upon the idea that ``that government closest to the people is the better government,'' to come now and say, ``no, no, no'' with respect to this matter, product liability, we have to get it up to the Federal level--I want to see that Governor who comes and says so, because he is just politically answering the Contract With America and political polls. I have been a Governor. You go before your legislature and you change things that need changing, whatever they are. If you have a good enough case, that legislature, that is very close to the people, is going to respond. But this has been a national fix for over 15 years. President Ford had a study commission. The result of that study commission said to leave it to the States. They did not like that. So they come in year in and year out, nibbling here and there, ``Well, can I get your vote if I change this? Can I get your vote if I change that?'' There's a fix on this side of the Capitol to get together with the House crowd to move forward with the English system, with caps, with all the other particular interests that they may be able to tag on. Like the sheepdog that has tasted blood now with that contract, they are going to turn to product liability and gobble up the rest of the flock while they can. Maybe so. Maybe so. But I hope my colleagues in this supposedly most deliberative body would stop and look and listen and understand that this is not any fairness act whatever. Everyone who has really treated with this, as lawyers--I will have to make a talk later on about the lawyers. We can go to Shakespeare where he said the first thing we do is kill all the lawyers. That was because the only thing standing between tyranny and freedom were lawyers. Jefferson was a lawyer. All these others, we could go down and mention these forefathers, outstanding lawyers, and, of course, they really drew that Constitution and they really had a feel for individual freedoms and the right of trial by jury under that seventh amendment. There are not any restrictions on that seventh amendment--until now. But now we are going to put on a national restriction that says a trial by jury should conform to these particular guidelines that we on high have decided, because you do not have sense enough at the local level to listen to the judge that charges that jury. I am going to yield because I see the distinguished chairman of our Judiciary Committee, who I am sure is proud of lawyers and is ready to speak. We could take murder cases like the O.J. Simpson case, and federalize that. I can give them some guidelines where they can move through in a judicious and expedited fashion rather than the theater that they have going on out on the west coast. No one would really dream of putting in a bill to federalize murder and murder cases with Federal guidelines. One big interest I have had as an attorney is: Give me a Federal cause of action. Let us get some uniformity amongst the 50 States. The 50 States, incidentally, do not mind taking some 50 to 75 insurance policies--and I have been in the insurance business--the 50 States do not mind going before the 50 State commissions and filing their particular policies. They say with insurance they have a very difficult time trying cases under different jurisdictions. Well, they do it with respect to all business and contracts. We have certain uniformity under the Restatement of Torts. But with respect to insurance itself, they will not give the Judiciary Committee or the Commerce Committee the facts as to how they have been losing money. They came in the mid-1980's and said there was a big insurance problem. We had an amendment which we will propose again--requiring information that they file. We have the Senators from the insurance State of Connecticut who are going to be heard later on. That crowd up there, Aetna, Hartford, the different insurance companies that are benefiting and making even more money will not tell you where they have had their losses. We have tried to get that information. I have been chairman of that committee for years on end, and now ranking member at this moment. But you cannot find the facts about insurance because they file them separately in the 50 States and they tell you they do not have a correlation. I know you have to have an actuary if you are going to have good insurance. I can tell you there are actuaries in those particular outstanding companies. They know whether they are winning or losing. They know where their costs are. But they will not give them to the National Congress. So, we are flying blind without the truth in a very abbreviated hearing with the arrogant assumption that the people who sent us here to Washington had the good sense and judgment to make you and I a Senator but all of a sudden they have lost their minds when it comes to trying a little law case in the courtroom back home. They are the only ones who have heard the sworn testimony. We have not heard any sworn testimony. All we have heard is from the fixers downtown. When we get to the chairman of the Judiciary Committee to talk about lawyers, we are going to have a good heyday. They have 60,000 downtown in the District of Columbia--60,000 lawyers. I doubt if many of them have ever been in the courtroom. They are all hired to fix you and fix me. They all are lobbyist lawyers to take anything they can for someone. I never heard of such fees around here. A poor fellow gets charged under ethics, and he has to hire a lawyer for $400 an hour to peruse all of his records and start looking at this and what happened 15 years ago, and all of that kind of nonsense. They do not come cheap. Billable hours is their theme. I practiced law for 20 years and never had a billable hour. If we won the case, we got a fee. If we did not win, that was my responsibility. That is the retainer system. We have many an injured party that is out of work. There is no salary, large medical bills, and everything else. Yes. tell that poor client not to worry about it. I am going to pay for the investigation. I am going to pay for the court costs. I am going to pay for the interrogatories. I am going to pay for the depositions. We are going to pay for the trial. I am going to pay for my time. If it goes up on appeal, I am going to pay for the printing of the record. I will appear before the Supreme Court. And, unless we prevail, you do not owe me one red cent. That worked in America for the poor folks, middle-class America. That would not work for the middle class, if they had to come under billable hours at $200, $300, $400. I think we maybe ought to have an amendment that we limit billable hours for defense lawyers, not put caps on punitive damages, but let us put caps on billable hours to, let us say, $50 an hour. If we had that, they would be making over $100,000, making as much as a Senator. That is just 40 hours a week for 52 weeks. But if they worked overtime like trial lawyers have to do, then they would make even more money. But they do not want to talk about caps on billable hours. That is the group of lawyers that are moving this thing. Nobody that represented an injured party is coming to this National Government and saying we have a national problem. They know differently. It is not easy. You have to get all 12 jurors to agree. The defense side has the investigative staff. When the plaintiff prevails, they are not runaway juries. In my State of South Carolina, the trial judge can look and say, such as recently was done in a case in Greenville, ``I do not like that finding under punitive damages. I am ruling out all punitive damages with respect to the actual verdict. Actual damages, I do not believe you should get but so much. You can take this much or get a new trial. One or the other. You can count on that.'' We have responsible, conservative jurors in my State. And I do not know where in the Lord's world the business community thinks this Congress is going to be more conservative and responsible than my State of South Carolina. That is why I feel so keenly about this. They might have the Gingrich leadership and the contract and the conservative bunch at this particular hour. But give it time. Give it time. This crowd is way more liberal than what we are back home. That business crowd, in the years to come, are going to find that you will trip up on the carpet and go over to the window and get your money. You watch how they move in on you when you get these national trends. This is not in the interest of business. It is not in the interest of consumers. It is not in the interest of good, sound law, and certainly does not respond to any need other than the political fix that has been worked in here. We have thwarted it time and again, by thoughtful Senators looking at it and understanding. We have a lot of work to do up here in the National Government. But certainly tort reform is not one of the great needs in this land. We have investors coming from all over the world because they like our system here as compared to the systems they have in their own countries. The particular industries involved, whether chemical, pharmaceutical and all, just under GATT were making profits, their biggest return, and they were being able to compete. Now the purposes of this particular bill is to try to allow them to put on the market certain pharmaceuticals that they are being prohibited from putting on the particular market because of product liability. It is a false chant and claim that should not be honored in this particular bill before us. The Commerce Committee members, I know them intimately. They know better but they are caught up in this particular jam, and we will have a good debate as we move along. I do thank my colleagues for their attention here this afternoon. I yield the floor. Mr. GORTON addressed the Chair.