Henry Hyde

Mr. HYDE

Mr. HYDE. Mr. Speaker, I regret the gentleman from North Carolina has left the floor. I hope he can hear me, anyway. He said some rather harsh things. He said this bill is a fraud. Since I am the chief sponsor of the bill, I guess I am trying to impose a fraud on America. Frankly, given the hyperbolic tendencies of all of us, even that is a little bit much. He said the bill has nothing to do with terrorism. Then he talked about habeas corpus. I just wish he would read the bill, or at least the same bill that I read. This bill provides for an open designation process of what is a foreign terrorist organization. It denies those terrorist organizations the ability to raise money in this country. It provides authority to the State Department to deny entrance visas to members of those designated foreign terrorist organizations. It provides a fair and even process to deport alien terrorists. It denies assistance to foreign countries that do not cooperate with us in our antiterrorism efforts. It provides that foreign air carriers that travel to and from the United States abide by the same safety measures that American air carriers must follow; mandatory victim restitution, not discretionary; criminal alien deportation improvements; granting Federal courts jurisdiction to hear civil suits against state-sponsored terrorism; mandatory minimum penalties for explosive crimes; protection of all current and former Federal employees who are attacked on account of their employment. That has nothing to do with terrorism? I find that incredible. As far as the deference that a Federal judge must give in a habeas proceeding to a State court decision, I simply say the State judge went to the same law school, studied the same law and passed the same bar exam that the Federal judge did. The only difference is the Federal judge was better politically connected and became a Federal judge. But I would suggest to my colleague when the judge raises his hand, State court or Federal court, they swear to defend the U.S. Constitution, and it is wrong, it is unfair to assume, ipso facto, that a State judge is going to be less sensitive to the law, less scholarly in his or her decision than a Federal judge. The Federal judge still has to look at the work product of the State court to decide if they got it right. Somehow, somewhere we are going to end the charade of endless habeas proceedings, and this bill is going to do it.

Mr. HYDE. Mr. Speaker, I know the gentleman's concern. It is a common one. It has to do with the deference that Federal courts will give to State court decisions. I believe that is what he is talking about. We will discuss that at some length in our debate on the bill, but the Federal judge always reviews the State court decision to see if it is in conformity with established Supreme Court precedence, or if it has been misapplied. So it is not a blank, total deference, but it is a recognition that you cannot relitigate these issues endlessly.

Mr. HYDE. Mr. Speaker, will the gentleman yield?

Mr. HYDE. Mr. Speaker, I thank the gentleman.

Mr. HYDE. Mr. Speaker, in listening to the remarks of the distinguished gentleman from Massachusetts [Mr. Kennedy], now I am confused. I remember they used to criticize a former President by ridicule, saying he could not walk and chew gum at the same time. It would seem to me that handling two ideas is not that difficult: habeas and antiterrorism, even if what he said is true, that they were not related; however, they are. If someone gets convicted of bombing a building and killing people, people who are the victims of that, and survivors, would like to be sure that the appeals cannot go on and on and on, as they do now. So bringing to closure and bringing the sentence that is imposed into reality does have something to do with bombing buildings, and that has something to do with terrorism.

Mr. HYDE

Mr. HYDE. Mr. Speaker, I yield 30 seconds to the gentleman from Michigan [Mr. Conyers].

Mr. HYDE. Mr. Speaker, 132 years ago, in a small cemetery in Pennsylvania, one of America's great presidents asked a very haunting question, whether a nation conceived in liberty and dedicated to the proposition that all men are created equal could long endure. Our answer to that question depends on how we legislate to protect a free people from those evil forces who seek our destruction through violence and terrorism. The bill, the conference report that we have before us today, does that in exemplary fashion. It maintains the delicate balance between liberty and order, between our precious freedoms and defending this country, something we have sworn to do when we took our oath of office to defend the Constitution and the country behind it. Now, this bill has had a stormy odyssey, and I think it is worthwhile to recapitulate a little bit. First of all, what has been added to the bill as it passed the House? Removal of alien terrorists. These provisions allow for the removal of alien terrorists fairly and with due process but also with protections adequate to safeguard sources and methods of classified information. Under the conference report, the alien will be given a declassified summary of the classified information, and this summary must be sufficient to enable the alien to prepare a defense. If the district court judge presiding over the hearing determines that it is not adequate to prepare a defense, the hearing terminates and the alien goes free. But we must protect sources, we must protect methods. We must balance that with the need for a fair hearing. So, we think this strikes the appropriate balance. There will be no secret proceedings or anything like that. Designation of foreign terrorist organizations, we got that back in the bill. It was taken out on the floor earlier. But we have provided that the Secretary of State, in cooperation with the Attorney General and the Secretary of the Treasury, can designate terrorist organizations. We are not talking about countries now. That is under another law. They can designate terrorist organizations. They must notify Congress within 7 days. We have a chance to review that, and we can set it aside if we wish. With that authority, the Secretary of the Treasury can freeze assets in this country that belong to terrorist organizations. Also back in the bill is the prohibition against terrorist fundraising. Raising money in this country is the lifeblood of many organizations, not excluding terrorists, and we put a stop to that with this bill. We also, under this bill, we have a procedure for excluding alien terrorists. We authorize the State Department's embassy officials overseas to deny entrance visas to members and representatives of those same designated foreign terrorist organizations. The Washington Post had an editorial this morning talking about keeping out alien terrorists that we might want to come in so we can negotiate with them. I suggest that the law has permitted that to happen, not this law but other laws. Yasser Arafat, Gerry Adams, people have come into this country under the law. And so this is not a hard and fast blanket exclusion. Prohibitions on foreign assistance, countries that do not cooperate with us in our antiterrorist acts will not get foreign assistance. On foreign air carrier safety, the conference report requires foreign air carriers that come into our country and leave our country provide the same security and safety measures, the identical ones that American air carriers must follow under regulations promulgated by the FAA. Those are important antiterrorist laws that will help us protect ourselves in the future, and anyone who says that there are not serious antiterrorist measures in this bill as not read it. Now, habeas corpus reform, that is the Holy Grail. We have pursued that for 14 years, in my memory. The absurdity, the obscenity of 17 years from the time a person has been sentenced till that sentence is carried out through endless appeals, up and down the State court system, and up and down the Federal court system, makes a mockery of the law. It also imposes a cruel punishment on the victims, the survivors' families, and we seek to put an end to that. We are not shredding the Constitution. We are shaping a process to keep it within the ambit of the Constitution, but to bring justice to the American people. That is what we have done with habeas corpus reform, and I simply direct attention to quotations from President Bill Clinton, who has said in death penalty cases, it normally takes 8 years to exhaust the appeals. It is ridiculous, 8 years is ridiculous; 15 and 17 years is even more so. So heed the words of our President on this subject. Now, we have a 1-year statute of limitations in habeas. Nothing wrong with that. I would like to read. I have left the letter up there. Diane Leonard, who is the wife of a Secret Service agent who was killed in Oklahoma City, sent this letter, which I just received today: Dear Congressman Hyde, The antiterrorism bill has reached this far and represents a victory for the vast majority of Americans over extremists of the left and right. A victory over extremists whose volume sometimes overwhelms the quieter voice that differentiates between right and wrong. The people who killed my husband, his coworkers and other law-abiding Americans did not give a damn whether they were killing Republicans or Democrats. I am asking that you call on your colleagues to have a similar blindness to party to do one thing, only one thing: Give us justice. Diane Leonard, widow of Donald Leonard, U.S. Secret Service victim, Oklahoma bombing. Mandatory victim restitution, right now it is discretionary. Under this bill, it is mandatory. Think of the victims and think of the victims first. Criminal alien deportation improvements, allowing for district court judges to order the deportation of aliens convicted of Federal crimes, not just because they are aliens. They are in the slammer for Federal crimes. But at the end of their term, they can get deported with expedition rather than go through another and another and another hearing. We also have maintained a taggant study. We put taggants in plastic which is used for bombs. But as for other substances, it is a fact, and this is not the NRA talking. It is a fact that we are not sure how safe and how efficacious, how efficient and how cost effective they are in things like fertilizer. We are going to have a study, and that study is going to be a scientific one, an objective one. Following that study, regulations may be promulgated and Congress will have a chance to look at them, 9 months of review to determine whether we should put taggants in other substances. I think it is sensible, a mainstream solution. On expedited asylum procedures, the conference report does not add any wiretap authorities that were not in the bill when it left the House. It does not give law enforcement any additional access to consumer credit reports or common carrier records. It does not give the military any increased role in civilian law enforcement. Now, these are here, some things I would love to have in the bill. I would love to have the multipoint wiretapping authority. I would love to use the technology and expertise of the military when chemical, biological, and nuclear weapons are used in public, but that is not in the bill. We did not have the votes, and so we put that aside in the interest of getting a good bill. The survivors want the habeas corpus. Habeas corpus is tied up with terrorism because when a terrorist is convicted of mass killings, we want to make sure that terrorist ultimately and reasonably has the sentence imposed on him or her. It is not incommensurate with the Constitution, it follows the Constitution and due process. So let us answer Lincoln's haunting question yes, a country conceived in liberty can long endure. Mr. Speaker, I include for the Record the following information: section 806 By enacting section 806, Congress intends that the Commission examine closely the priorities and structure of Federal law enforcement as we head into the 21st century. The large proliferation of Federal agencies with law enforcement authorities, overlapping jurisdiction, nonstandardized policies and procedures among the various agencies, and separate training and administrative functions require examination to determine if Federal law enforcement effectiveness can be increased in an era of fiscal austerity. There are clear distinctions in procedures, planning, and capabilities of the various law enforcement agencies. This is especially so when, as has increasingly become the case, Federal and local officials are working jointly on investigations and operations. Congress intends the Commission to examine issues of coordination to ensure effective utilization of scarce resources and to ensure proper Federal support for State and local law enforcement. Accountability for law enforcement operations has increasingly become an issue before Congress. Congress specifically intends that the Commission examine who within the executive branch should ultimately be responsible, short of the President, for interagency coordination, uniform standards, ethical standards and the other issues common to all Federal law enforcement agencies. Congress believes the current proliferation of agencies, the confusion and dangers that result therefrom and the lack of clear accountability and responsibility has lead to an unhealthy level of competition fostering operations and inefficiencies that are not in the best interests of public safety. Congress does not intend by the establishment of this Commission to create an oversight function separate from that already performed by Congress. Congress historically has always been very mindful of the dangers inherent in examining specific cases, of protecting raw investigative information and from ensuring that the political process does not impede or intimidate those line investigators and prosecutors charged with enforcing the law. The managers realize that having an outside Commission examining cases and the details of investigations could have a chilling effect on those who must protect our public safety. Congress believes that to ensure the protection of the privacy and civil rights of people investigated but not charged, the Commission must not examine specific investigations or investigative or prosecutive strategies. Likewise, to ensure that investigations remain unimpeded and investigators and prosecutors remain free of the potential for influence or intimidation, the Commission must avoid examining specific cases, calling as witnesses line personnel or seeking information the disclosure of which would have dire consequences, for example, informant identities, confidential witnesses, sensitive techniques, et cetera. Even in closed cases, examination of discretionary investigative and prosecutorial decisions risk not only the appearance of political influence and chilling aggressive prosecution, it also threatens the due process rights of suspects and defendants. The Commission is not established to put specific cases under the microscope. To the contrary, it is intended to focus on macro issues that go to effectiveness, coordination, efficiency and public safety. Congress does not intend the Commission to examine issues or cases involving national security. Mr. Speaker, I reserve the balance of my time.

Mr. HYDE

Mr. HYDE. Mr. Speaker, with great respect I would like to advise the gentlewoman, there is no limitation on economic damages or noneconomic damages. It is punitive damages only that there is a limitation. That provision was taken out of the bill and there just is no limitation on economic or noneconomic damages.

Mr. HYDE. Mr. Speaker, will the gentlewoman yield?

Mr. HYDE. Mr. Speaker, if the gentlewoman will continue to yield, I thought you were talking about economic and noneconomic. The punitive damages, yes, there are limitations.

Mr. HYDE

Mr. HYDE. Mr. Speaker, I am pleased to yield 1 minute to the gentleman from Virginia [Mr. Goodlatte], a distinguished member of the Committee on the Judiciary. (Mr. GOODLATTE asked and was given permission to revise and extend his remarks.)

Mr. HYDE. Mr. Speaker, I yield the balance of my time to the gentleman from Illinois [Mr. Manzullo].

Mr. HYDE. Mr. Speaker, I yield 2 minutes to the distinguished gentleman from Pennsylvania [Mr. Gekas].

Mr. HYDE. Mr. Speaker, pursuant to House Resolution 394, I call up the conference report on the bill (H.R. 956) to establish legal standards and procedures for product liability litigation, and for other purposes.

Mr. HYDE. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks on the conference report on H.R. 956.

Mr. HYDE. Mr. Speaker, I yield 15 minutes of my time to the gentleman from Virginia [Mr. Bliley], chairman of the Committee on Commerce, and I ask unanimous consent that he may be permitted to control that 15 minutes.

Mr. HYDE. Mr. Speaker, I yield myself 2 minutes. (Mr. HYDE asked and was given permission to revise and extend his remarks.)

Mr. HYDE. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I was shocked to learn that the jury system is somehow no longer applicable. That is news to me.

Mr. HYDE. Mr. Speaker, I object to the vote on the ground that a quorum is not present and make the point of order that a quorum is not present.

Mr. HYDE. Mr. Speaker, I yield 3 minutes to the distinguished gentleman from South Carolina [Mr. Inglis].

Mr. HYDE. Mr. Speaker, I rise in support of the conference report on H.R. 956, the Commonsense Product Liability Legal Reform Act of 1996. This legislation is an important first step in the longstanding congressional effort to reform our legal system. Although the reforms contained in the conference report do not go as far as I and many in this Chamber would have liked, this legislation takes some important first steps in restraining the excesses of the current out-of-control legal system. It is a solid downpayment on long-needed reform. When the House passed H.R. 956, the Commonsense Product Liability Legal Reform Act of 1995, in March of last year, we did so on a strong bipartisan vote of 265 to 161. That vote sent a message that the new Republican majority in Congress was resolute in its commitment to bring about broad-based legal reform and an end to lawsuit abuse. It has taken us more than a year to complete this process, but we now have before us a conference agreement which, while not as ambitious as the House bill, will for the first time in the history of Congress take aim at the inequities and inefficiencies of our legal system. This is not only a first step in the direction we need to head, but it is a step which we can realistically enact this year. The Senate has already approved this measure by a vote of 59 to 40. Despite the fact that the agreement does not go far as reforms that the House voted for--notably extending relief to all civil actions--we must not lose sight of the fact that product liability reform is an historic accomplishment. It will unleash an American job creation boom and will translate into real growth for our economy. I would like to take this opportunity to highlight several key provisions contained in the conference report. statute of repose One very important part of this conference agreement imposes a uniform statute of repose of 15 years for cases involving durable goods. A statute of repose specifies the period of time after manufacture of a product during which a lawsuit relating to the product may be brought. The statute of repose addresses the unfairness that results when manufacturers are sued on the basis of products that left their control many years ago. This allows U.S. manufacturers to compete with foreign companies that have entered the marketplace in recent years and face no liability exposure for very old products. Section 101(7) of the conference report defines the term durable good as meaning first, ``any product or any component of any such product which has a normal life expectancy of three or more years'' or second, any product which ``is of a character subject to allowance for depreciation under the Internal Revenue Code of 1986 and which is: (A) used in a trade or business; (B) held for the production of income; or (C) sold or donated to a governmental or private entity for the production of goods, training, demonstration or any other similar purpose.'' Thus, the agreement describes two distinct categories of products which will be covered by the statute of repose provision. Under the first clause of the definition, a manufacturer of a product such as a machine tool, farm equipment, a bicycle or a ladder, a toaster or gas furnace, an elevator, or building materials such as plate glass, wall coatings, or roofing tiles could not be sued based on harm allegedly caused by that product more than 15 years after the product was first delivered. Thus, a product which has a normal life expectancy of 3 or more years need not meet any other criteria to qualify as a durable good. Again, the second clause of section 101(7) covers products that are subject to allowance for depreciation under the Internal Revenue Code and used in a trade or business, held for the production of income, or sold or donated to a governmental or private entity for the production of goods, training, or similar purposes. These types of products would also be covered by the 15-year statute of repose adopted in the conference agreement. Some have erroneously stated that the statute of repose in the conference report is confined to goods used in the workplace. That is not correct. The language of the conference agreement is clearly not limited in this manner, nor should it be. In his eloquent statement in support of the legislation, Senator Gorton pointed out two examples--step ladders and football helmets-- where a large proportion of the price of the product is accounted for by the cost of product liability actions and insurance. Senator Gorton's use of these examples underscores the irrationality of any workplace limitation on the statute of repose. A workplace limitation would make unjustified and unfair distinctions between products, and could produce wildly inconsistent results for manufacturers who may have no control over where, and under what circumstances, their products may be used. For example, if the statute of repose were limited in such a manner, a manufacturer of a ladder used in the workplace would be protected 15 years after the ladder is sold; but if that same ladder is used in the home the statute of repose would not apply. A football helmet used in professional sports would be covered by the statute of repose; but one used in other settings would not be. There are numerous other examples of arbitrary distinctions and unequal treatment that would result from a workplace limitation. A manufacturer of a mower used by a farmer would be protected from lawsuits after 15 years, while one whose same product is used by a weekend gardener would not be. The conference report rightly eliminates these types of arbitrary and unfair distinctions. The statute of repose provision contains certain exceptions. It does not, for example, preempt the 18-year statute of repose contained in the General Aviation Revitalization Act of 1994. Neither does it apply in a case involving a vehicle used primarily for hire, where the existing State statute of repose, if any, would continue to apply. The conference agreement provisions will also not apply in the case where the manufacturer or seller has expressly warranted the safety or life expectancy of the product to be longer than 15 years. In those cases, the private agreement of the parties will control. The statute of repose also includes a toxic harm exception, which has been the source of a great deal of confusion and uncertainty. This exception was included in the Senate-passed bill to address a concern which had been raised about products that cause physical injuries that are latent, that is, injuries that do not manifest themselves for many years after a person is first exposed to a product. Because the term ``toxic harm'' was not defined in the Senate bill and is not defined in the conference report, I want to spend a few moments clarifying the congressional intent with respect to the scope of this provision. Numerous Federal statutes and regulations contain definitions of the word ``toxic,'' and some of those definitions differ widely from others. Some of those definitions, if relied upon to interpret the ``toxic harm'' exception in H.R. 956, would broadly except from the statute of repose products where the alleged harm ranges from harm caused by excessive noise, cold, vibration, or repetitive motion--such as repetitive stress injury--to those in which the alleged harm is caused by chemical or other elements, to products like asbestos, where the injury to a person caused by the product may be latent for many years. The conferees did not adopt or incorporate these wide-ranging definitions. The House-passed bill contained a provision which addressed the problem the Senate bill sought to address, but which used different words. The House provision excluded from the statute of repose products that cause latent harm, specifically, a ``physical illness the evidence of which does not ordinarily appear less than 15 years after the first exposure to the product.'' Although the words used were different, the intent of the House and Senate provisions was the same: to except from the statute's time bar actions involving products alleged to cause latent illness. The House, therefore, receded to the Senate bill's use of the ``toxic harm'' language, because it too is intended to provide an exception only for products that cause physical illness, evidence of which cannot be detected until long after exposure to the product, such as, harm that cannot be detected within a 15-year period. Finally, it is important to note that the statute of repose contained in the conference agreement only preempts State statutes of repose which are longer than 15 years. It also does not limit a State statute of repose from extending beyond durable goods to other types of products. Thus, for example, a State statute of repose, which limits suits to those brought within 12 years of delivery of the product, and which covers all goods, would not be affected by the conference agreement. punitive damages The conference agreement generally adopts the Senate's language regarding a limitation on punitive damages. Punitive damages are intended for cases where the defendant's conduct has been particularly harmful--where the conduct involved gross negligence or intentional conduct. They should be awarded only in the most serious cases. Punitive damages are generally limited to two times compensatory damages or $250,000 whichever is greater. This limitation will be imposed by the court in the event that a jury--which is not to be told of the cap--awards a higher amount. In the event that the cap operates to limit an otherwise higher jury award, the conference agreement allows the court to consider whether that cap is appropriate. If after reviewing the facts of the case the court finds that the amount of punitive damages allowed under the cap is inadequate, the court may increase the award, up to the amount of the initial jury punitive damage award level. In no event may the punitive damage award exceed the amount of the original jury verdict. The limitation on the court's ability to award punitive damages in excess of the cap in no way suggests that the court will not have the normal discretion to review and decrease punitive damage awards in the proper circumstances. This power will continue to exist whether or not the initial jury award exceeds the limitation imposed under the conference agreement. A special rule applies in the case of defendants with a net worth of $500,000 or less, or entities employing 25 or fewer full-time employees. For cases involving those defendants, the cap on punitive damages will be two times compensatory damages or $250,000, whichever is greater. For cases involving those defendants, the court may not increase the award beyond the statutory limit. The limitations imposed by the section are to be applied defendant by defendant. Thus, in a case involving two or more defendants, the plaintiff could potentially obtain the maximum amount of punitive damages from each defendant. For purposes of calculating the limit for each defendant, compensatory damages will include only the percentage of damages for which that defendant is found liable. The conference agreement permits a court to award additional damage under section 108(a)(3), but only in cases of egregious conduct. Egregious conduct in this context means conduct where the defendant against which the punitive damages are awarded specifically intended to cause the harm that is the subject of the action or acted with actual malice toward the claimant. Unless the defendant's conduct meets this standard, the provisions of section 108(a)(3) will not apply, and the court will have no authority to exceed the amount of punitive damages established in section 108(a)(1). The provisions of the conference agreement in section 108(a)(3) which allow the court to exceed limitations on punitive damages are intended by the conferees to be treated as severable in the event a court determines that judges lack constitutional authority to award additional amounts of punitive damages. Should a court so find, the continued operation of the limitations otherwise imposed by section 108 will not be affected. Section 108 does not preempt State laws which more narrowly limit the amount of punitive damages that may be awarded. Thus, if a State imposes a dollar limit on punitive damages which is less than the cap set forth in section 108(a)(1), the State law will apply, and the conference agreement's provision allowing for the award of additional damages by the court will not apply. Similarly, if the State law contains a provision for additur, but restricts the amount of additur permitted to less than the initial jury award, the provisions of the State law will prevail. Thus, the punitive damage reforms of H.R. 956 are minimum standards and limitations designed to provide some measure of rationality; they would not displace the law of States with more restrictive punitive damage regimes. For example, many States have punitive damage limitations that do not allow the judge to override the statutory maximum. Nothing in the conference report displaces the laws of such States. Similarly, States are free to require higher standards of proof and to impose substantive requirements in addition to those in the conference report. The preemptive effect of the punitive damage reforms turns on three separate provisions of the conference report. First, the Federal law ``supersedes State law only to the extent that State law applies to an issue covered by the Act.'' Second, the conference report provides that ``punitive damages may, to the extent permitted by applicable State law, be awarded against a defendant if the claimant establishes by clear and convincing evidence that conduct carried out by the defendant with a conscious, flagrant indifference to the rights or safety of others was the proximate cause of the harm that is the subject of the action.'' Third, the conference report provides that the Act ``does not preempt or supersede any State or Federal law to the extent that such law would further limit the award of punitive damages.'' Mr. Speaker, the express preservation of State laws that further limit the award of punitive damages was part of the bill approved by the House in March, but it was not part of the amendment passed by the Senate. During the Conference, I led the House conferees in insisting that this provision be included. The conference report adopts the House preemption language--language that makes very clear the preemptive effect of the punitive damage reforms. Taken together with the other provisions, this provision conclusively demonstrates that the Act would not expand liability for punitive damages, or increase the permissible amount of punitive damages, in any State. If State law imposes substantive or procedural requirements concerning the circumstances under which punitive damages may be awarded that are more stringent than the Federal law, the State law controls. Similarly, if the application of State law limits on the amount of punitive damages results in an award of punitive damages that is less than that permitted under the Federal law, the State law controls. Let me explain, Mr. Speaker, why this is the only interpretation that is consistent with the plain language of the conference report, as well as the intent of its drafters. Consider, for example, more stringent State standards for the award of punitive damages. Everyone agrees that the act would not make punitive damages available in States, such as Washington, that do not currently allow the award of punitive damages. In such States, no award of punitive damages is permitted by applicable State law and the punitive damage provisions therefore do not come into play. Likewise, the act would not lower the standards for awarding punitive damages in States such as Colorado--which requires proof beyond a reasonable doubt--or Maryland--which requires proof of actual malice. If a claimant meets the standard of proof in the Federal law but not the higher standard imposed by State law, no award of punitive damages is permitted by applicable state law. Again, the punitive damage provisions of the Federal statute simply do not apply to cases in which punitive damages would not otherwise be available under State law. In addition, State laws that impose a higher standard of proof than the Federal act, or that provide for additional substantive requirements, further limit awards of punitive damages and therefore are not preempted by the act, which does not preempt or supersede any State or Federal law to the extent that such law would further limit the award of punitive damages. Any State law that would make punitive damages unavailable even if the Federal requirements are met, or that would result in an award of punitive damages lower than the Federal limitations, is one that further limits the award of punitive damages. Such laws expressly are not preempted. It is also important to recognize, Mr. Speaker, that the act would not affect State caps on punitive damages. In most cases, the act would limit punitive damages to the greater of $250,000 or two times compensatory damages. At the same time, many States have limited punitive damages by providing a maximum dollar amount, a multiplier, or some other statutory limitation on the amount of punitive damages. In many cases, application of these State limitations would result in a lower punitive damage award than would application of the Federal limitations. In such cases, these State laws would remain in effect. For example, Virginia has enacted an absolute cap of $350,000 for punitive damages. Illinois limits punitive damages to three times economic damages. Application of these limitations to a punitive damage award results in the maximum amount of punitive damages permitted by applicable State law. Even if the Federal law would allow a higher award of punitive damages, therefore, the State law limitations would control. By contrast, if the Federal limitations resulted in a lower amount, the Federal limitations would control. Lest there be any doubt on this subject, the conference report expressly provides that the act ``does not preempt or supersede any State or Federal law to the extent that such law would further limit the award of punitive damages.'' This provision can only mean that if application of a State limitation would result in a lower award of punitive damages than the Federal rule, the further limit of the State law controls. Commercial Loss The conference revisions to H.R. 956 are intended to clarify congressional intent concerning claims for commercial loss. Commercial loss, as defined in section 101(5), means any loss or damage to a product itself, loss relating to a dispute over its value, or consequential economic loss. As further stated in the definition, any claim for any of these three types of loss is to be governed by the Uniform Commercial Code or State law versions of its provisions, or by contract law. This definitional requirement that all actions for commercial loss be governed by commercial or contract law is accompanied by the affirmative mandate in section 102(a)(2) that any civil action brought for commercial loss shall be governed only by applicable commercial or contract law. Congressional intent is to codify the historical approach that tort theories are not applicable to such claims, and may not be employed with respect to them. The reforms contained in H.R. 956 are aimed predominantly at correcting certain abuses and providing some reasonable uniformity in the tort law of products liability. Claims for commercial loss traditionally do not fall in the tort realm, but are dealt with in accordance with the contractual agreement created by the parties themselves, or by the UCC. This economic loss rule is typified by the opinions of the California supreme court in Seely versus White Motor Company, and the U.S. Supreme Court in East River Steamship Corporation versus Transamerica Delavel. Despite limited judicial inroads by other courts that have sought inappropriately to engraft tort branches onto the commercial tree, the bill excludes commercial loss from the scope of its tort-related provisions. In so excluding commercial loss, Congress did not seek to carve out a category of loss undeserving of the bill's protections, but rather to recognize that there is a massive, extant body of commercial and contract law historically more suited to such claims. In order to assure that such claims are not subject to tort system abuses that the bill aims to rectify, the conference chose affirmatively to mandate that commercial loss claims be governed exclusively by commercial or contract law. Such a rule of law is necessary to promote uniformity and predictability, in the interests of interstate commerce and due process. This position is entirely consistent with the House Judiciary Committee report (H. Rept. 104-64), and codifies the common law rule. This bill does not intend to disrupt or affect application of the economic loss doctrine. Congress fully supports the traditional rule that disputes that essentially involve failed commercial expectations, damage or loss to a product itself, or diminished product value, are not recoverable in tort. Exclusion of commercial loss from the bill is intended to protect the body of extant contract and commercial law, and while assuring that tort or other inappropriate causes of action are not engrafted onto that body of law. definition of product The definition of a product in section 101(14) of the conference agreement is not intended to include improvements to real property. A manufacturer is able to test its product and control quality in a way that is impossible on a construction site where a variety of systems are being coordinated to create a more complex structure. Each construction project is built from an extremely complicated and unique set of drawings and specifications involving interrelated systems and many individual products specified by a design professional and over which the constructor has little control. Forty-seven States have recognized this distinction between a product and an improvement to real property by enacting specific statutes of repose for improvements to real property. It was the intent of the conferees that the definition of product in H.R. 956 honor this distinction. Mr. Speaker, after nearly two decades of effort to fashion a comprehensive set of product liability reforms, we have crafted a bipartisan consensus package of bottom-up reforms. These reforms are desperately needed to restore some fairness to our present system and to remove roadblocks to our country's economic growth and job creation. I urge my colleagues to join me in supporting the conference report to accompany H.R. 956.

Mr. HYDE. Mr. Speaker, I yield such time as he may consume to the gentleman from California. [Mr. Campbell]. (Mr. CAMPBELL asked and was given permission to revise and extend his remarks.)

Mr. HYDE. Mr. Speaker, I yield myself 30 seconds simply to say I have heard so many things about this bill that just are not so. There is nothing in the world inhibiting a woman who has a faulty breast implant from suing and getting full recovery, economic, noneconomic, and, if the case warrants, punitive damages, twice whatever the economic and noneconomic total up to. And if it is an egregious case, the judge can add more to it. So I just do not know what I am hearing here. They are talking about some other bill that has not been written. Mr. Speaker, I yield 3\1/2\ minutes to the distinguished gentleman from Tennessee [Mr. Bryant]. (Mr. BRYANT of Tennessee asked and was given permission to revise and extend his remarks.)

Mr. HYDE

Mr. HYDE. Mr. Speaker, will the gentleman yield?

Mr. HYDE. Mr. Speaker, yes, I will inform my colleagues that all Federal agency rules will be subject to congressional review upon enactment of the Congress Review Act.