Patrick Leahy

Mr. LEAHY

Mr. LEAHY. Mr. President, I ask unanimous consent that the order for the quorum call be dispensed with.

Mr. LEAHY. Mr. President, I am prepared to yield the remainder of my time to the Senator from Pennsylvania, but I would like to make just a couple of points, if he doesn't mind, before I do that. Mr. President, with all of the talk, let us not lose sight of a couple of things. This bill does not violate 407(b), no matter what anybody says, because we specifically say the taxpayer funds will not be spent to compensate victims of asbestos exposure. That has been our position from day one, and that is what the bill says today: not a single dollar is spent. In fact, the CBO states that over the life of the fund, whether or not it sunsets, we would not expect the legislation to add to the aggregate Federal debt. It just doesn't add to debt. The Federal Government is involved only because it acts as a conduit for the private funding of $140 billion. All the parties said they wanted that in the Department of Labor because they had the experience and the infrastructure necessary to set up a quick start for the victims. We have heard the figures about projection of interest rates. If we follow those projections, the interest rates would have to be at 25 percent. Twenty-five percent. Even with the recent increases by the Federal Reserve Board, we are still way in the low single digits. The CBO considered all the estimates. They met with dozens of financial experts, economists, auditors, everybody. They say payments were raised from $120 billion to $150 billion, at most. They said $140 billion will cover all claims, payments, administrative costs, and borrowing costs. That is why we have the financial institutions, we have our veterans, we have labor. As this chart shows, labor organizations are strongly for it. Then we ought to keep in mind that these are the people who are not going to recover unless this bill goes through, and 26 veterans organizations have come out to say they oppose this budget point of order. Twenty-six veterans organizations oppose it because they know they need this bill. Mr. President, I yield the remainder of my time to the distinguished Senator from Pennsylvania.

Mr. LEAHY. Mr. President, I suggest the absence of a quorum.

Mr. LEAHY. I suggest the absence of a quorum, and I ask unanimous consent the time be equally charged.

Mr. LEAHY. Mr. President, I ask unanimous consent that at the appropriate time the Senator from Montana gain the floor and that he be granted 10 minutes of my time.

Mr. LEAHY. Mr. President, parliamentary inquiry: The opponents of the position of the Senator from Nevada, how much time do they have?

Mr. LEAHY. This is in opposition to the position. I will reserve my 15 minutes for the Senator from Pennsylvania and myself.

Mr. LEAHY. Mr. President, the Senator from California has been a strong and consistent voice on this issue. I will follow her. Thank you.

Mr. LEAHY. Mr. President, how much time is remaining to the various parties?

Mr. LEAHY. Mr. President, parliamentary inquiry: Are we operating under controlled time?

Mr. LEAHY. Former Senator Don Nickles, with whom many of us served, raised this concern. The Government Accountability Office responded: [T]o ensure the Government incurs no liability for repayment of borrowing under this act, Congress may wish to explicitly state repayment of borrowing is limited solely to balances available in the fund. That is precisely what we did in the FAIR Act. A simple reading of the text of the bill shows that defendants and their insurers are obligated to pay $136 billion to the fund, and additionally another $4 billion of the assets from existing bankruptcy trusts. If this level of funding proves to be insufficient--most doubt it will not, but if it does--then we revert back to the tort system which we have now. If we pass this legislation, thousands of people who had their health severely impacted through no fault of their own because of asbestos will have a chance to recover. Will some recover as much as some of the lucky few who were able to get through the whole tort system? No, nor will their attorneys even begin to recover the huge amounts some of the attorneys did. The private companies are required under this legislation to continue making payments to the fund even after sunset until all of the fund's obligations are satisfied under section 405. Even the administrative expenses are paid from this private fund. Finally, the bill clearly states: Nothing in this Act shall be construed to create any obligation of funding from the United States Government, including any borrowing authorized . . . The Senator from Pennsylvania and I have this as a touchstone all the way through, that we are not passing a piece of legislation for the taxpayers to fund. We are seeking help for those who have been injured. Senator Specter and I have been working on this issue for years. We have carefully considered the design of the compensation program for asbestos victims and ways to avoid the pitfalls of other Federal compensation programs that have been enacted by Congress. Many of the compensation programs cited by the opponents of S. 852 were created by Congress with mandatory Federal spending and did not contain a provision to sunset the program if it went under-funded. We rejected such proposals for asbestos legislation. Many opponents of our trust fund wanted the claims processing to be in a private corporation. Labor groups and victims testified that operating this trust fund in a new, private entity would delay compensation to sick victims and would entail significant administrative costs. Accordingly, we agreed to house the asbestos trust fund within the Department of Labor because it has expertise with compensation programs. It has existing staff with relevant experience and critical infrastructure and contracting capabilities to ensure an accelerated pace to pay the sickest victims within months of enactment. Members of the financial services community recently contacted my office to rebut the conclusions made in the recent ``white paper'' distributed by the minority staff of the Senate Budget Committee. The investment community indicates that this minority staff report circulated last week dramatically overstates the financing expenses to be expected under this legislation. This document alleges that $125 billion will be spent by the fund on borrowing because it vastly overstates claims projections and interest rates. The minority staff document ignores the fact that section 221 of the legislation provides that borrowing by the trust fund will be within a 10-year time frame. The document alleges that the FAIR Act will pay borrowing at an interest rate of a whopping 25 percent. This assumes an interest rate six times higher than the current 10-year Treasury bond rate. In fact, the financial community opines that due to the structural aspects of the legislative language, it is ``overwhelmingly likely that financial markets will treat the trust fund as an investment grade credit'' and therefore it would have access to highly favorable borrowing rates. I ask unanimous consent to have printed in the Record the FIAR letter.

Mr. LEAHY

Mr. LEAHY. Some of our most important legislation is produced not only when we reach across the aisle in the name of bipartisanship but when we work across chambers and reach true consensus. I would also like to thank Senators Alexander, Bayh, Brownback, Coburn, Cornyn, DeWine, Durbin, Feingold, Feinstein, Hatch, Kyl, Levin, Reed, Stabenow and Voinovich for their cosponsorship of the Senate companion legislation. Counterfeiting is a serious problem that does not lend itself to a quick and easy solution. This legislation is an important step toward fighting counterfeiting. I hope we can build on the success of this law.

Mr. LEAHY. Senator Specter, thank you for that clarification. As you are aware, there has been overwhelming support for this legislation. It has been very heartening to see such overwhelming support for this important bill. Counterfeiting is a threat to America. It wreaks real harm on our economy, our workers, and our consumers. This bill is a tough bill that will give law enforcement improved tools to fight this form of theft. The bill is short and straightforward, but its impact should be profound and far-reaching.

Mr. LEAHY. Section 2(b)(1)(B) authorizes U.S. attorneys to pursue civil in rem forfeiture proceedings against ``any property used, in any manner or part, to commit or to facilitate the commission of a violation of subsection (a).'' The intent of this language is to provide attorneys and prosecutors with the authority to bring a civil forfeiture action against the property of bad actors who are facilitating trafficking or attempts to traffic in counterfeit marks. The forfeiture authority in section 2(b)(1)(B) cannot be used to pursue forfeiture and seizure proceedings against the computer equipment, Web site, or network of responsible Internet marketplace companies, which serve solely as a third-party to transactions and do not tailor their services or their facilities to the furtherance of trafficking or attempts to traffic in counterfeit marks. However, these Internet marketplace companies must make demonstrable good faith efforts to combat the use of their systems and services to traffic in counterfeit marks. Companies must establish and implement procedures to take down postings that contain or offer to sell goods, services, labels, and the like in violation of this act upon being made aware of the illegal nature of these items or services. It is the irresponsible culprits that must be held accountable. Those who profit from another's innovation have proved their creativity only at escaping responsibility for their actions. As legislators, it is important that we provide law enforcement with the tools needed to capture these thieves. Senator Specter, it is also my understanding that the U.S. Sentencing Commission recently promulgated new Federal sentencing guidelines to account for the changes in how intellectual property crimes are committed. Could you clarify for the record why we have authorized the U.S. Sentencing Commission to further amend the Federal sentencing guidelines and policy statements for crimes committed in violation of title 18, section 2318 or 2320, of the United States Code?

Mr. LEAHY

Mr. LEAHY. Mr. President, did the Senator from Montana wish to say something?

Mr. LEAHY. Mr. President, the Senator from Pennsylvania is absolutely right; it will not be a party-line vote. I hope the Senator from Pennsylvania succeeds. It is interesting, the people who represent victims and people who don't have legal representation support the Senator from Pennsylvania. Just about every labor union supports the Senator from Pennsylvania, as veterans groups do. I will not go through the list again. Just about every veterans group that has spoken on this issue supports the Senator from Pennsylvania. There are a lot of others who support the Senator from Pennsylvania, but I mention veterans and labor as an interesting coalition. They are speaking for people who would not have a voice otherwise. They support what the Senator from Pennsylvania is doing, as do an awful lot of businesses, I might add. I hope he is successful.

Mr. LEAHY. Mr. President, I thank the distinguished senior Senator from Montana for his comments. I should note that from the first day Senator Specter and I started talking about this legislation, the distinguished Senator from Montana was there visiting with us. He made it very clear he wanted to make sure that whatever we passed took care of what is an extraordinary and unique situation in Libby, MT. His help and his counsel have been extraordinarily important throughout. We had so much testimony that said the same thing, that said the current system for compensating asbestos victims is broken. Victims are dying. Ironically, they are dying while they are waiting for their day in court--a day that will not come. Even for those who finally receive their day in court, they often receive only a small percentage of the costs involved in our tort system. Of course, if the defendant has been forced to file for bankruptcy, or decided to file for bankruptcy, these victims receive little or no compensation. I think, as both Chief Justice Rehnquist and Justice Ruth Bader Ginsburg have said, this cries out for a solution outside of the court system that streamlines the claims process for victims, to make sure they receive timely and fair compensation relative to the severity of their injuries. That will protect compensation they receive from subrogation by insurance companies. Actually, we find from the most recent RAND study asbestos victims receive an average of only 42 cents for every dollar spent on asbestos litigation. What may surprise some, 31 cents of every dollar goes to defense costs. A somewhat smaller amount, 27 cents, goes to plaintiffs' attorneys and other related costs. All that is eaten up before the victim, the one suffering, sees anything. I think the enactment of a medical criteria bill, such as the amendment the distinguished Senator from Texas, Mr. Cornyn, has proposed, for asbestos would fail to reduce the high transaction costs of the asbestos tort system. Medical criteria bills do nothing to protect businesses from going bankrupt or victims who were injured by bankrupt companies to receive fair compensation. The plain fact--the plain and easy fact--is many of these asbestos manufacturers are in bankruptcy proceedings and, therefore, are immune from suit. Victims, such as our Nation's veterans, are unable to recover for asbestos exposure while serving their country in the current tort system. Think of that, our veterans. We received the following testimony from Hershel Gober, the national legislative director of the Military Order of the Purple Heart. He said: We believe the compensation fund approach is the only solution that will provide veterans suffering from asbestos- related illnesses with fair [with fair] and certain compensation. But he also pointed out: The avenues open to veterans to seek compensation through the tort system, however, are very limited. The Federal government, as the members of this Committee know, has sovereign immunity, thereby restricting veterans' ability to recover from the government; and most of the companies that supplied asbestos to the Federal government have either disappeared or are bankrupt and, therefore, are only able to provide a fraction of the compensation that should be paid to asbestos victims, if anything at all. This distinguished veteran went on to say: Even if there is a solvent defendant company for a veteran or his/her family to pursue, there remains the lengthy, costly, and uncertain ordeal of filing a civil lawsuit and going through discovery and trial, where the plaintiff bears a heavy burden of proof and often has the very difficult to impossible task of establishing which defendant's product caused their injuries. Criteria bills, such as that of the distinguished Senator from Texas, will do nothing to compensate victims such as our Nation's veterans who are injured by bankrupt companies during their service to our great country. Legislation imposing medical criteria on the tort system is inherently unfair to victims. These measures don't alleviate the delays victims face when they are confronted with overwhelmed court dockets. Criteria bills, such as the Cornyn amendment, allow defendants and insurers to enjoy the delays of litigation and maintain all of their defenses in the tort system. They are far away from streamlining a procedure to help people who are sick and dying, and they impose new hurdles for plaintiffs and continue to require the identification and proof of the manufacturer or entity responsible for exposing them to asbestos decades ago. In contrast, the bill Senator Specter and I have brought to the floor will not require victims to identify and prove the manufacturer or entity that exposed them to asbestos. They only have to show the suffering they have had from asbestos. They will not have to hope that the entity responsible for their exposure is still in existence or financially solvent. They will recover compensation under the fund in proportion to their impairment or disease. The current system for compensating victims of asbestos exposure is inefficient and inequitable. This medical criteria amendment is not a solution. It actually operates within that same broken tort system. I could go further, but I know the distinguished chairman hopes we will come to a point where we can vote. I would note that this amendment will preempt the silica claims of thousands of victims. I understand that the AFL-CIO and other labor unions representing thousands of workers, like this distinguished veterans association, oppose the Cornyn amendment. I suggest the absence of a quorum.

Mr. LEAHY. Will the Senator yield for a moment?

Mr. LEAHY. It is interesting. We have a lot of labor unions coming out foursquare for the bill. Some held back and they want a couple of changes they are looking for. It is interesting that all of them are against this amendment--those who haven't yet endorsed the bill and those who have endorsed the bill. It is the same with the veterans groups. I think they know that this amendment, no matter how well intentioned it would be, if it went through, basically kills the chances of people to recover anything. It puts us back into the decades of litigation where, as people across the spectrum were saying, from the late Chief Justice William Rehnquist to Ruth Bader Ginsburg, we need a solution on the floor.

Mr. LEAHY. Well, if the Senator will yield, like him, I was a trial lawyer. But I know with all trial lawyers, there are times when you have a superb settlement before you, you take it. The bill the Senator from Pennsylvania and I put together, after countless hours, months, and years of work, is a lot better settlement than going to a jury. I will support the Senator from Pennsylvania.

Mr. LEAHY

Mr. LEAHY. Mr. President, all of us who are friends and colleagues of the senior Senator from Pennsylvania, Senator Specter, are delighted with his robust recovery from a difficult illness. Nearly a year ago Senator Specter announced that he had been diagnosed with Hodgkin's disease. He declared that he was going to beat it, just as he had beaten a brain tumor, heart surgery and several other challenges. We are delighted that his promise has been fulfilled, as we knew it would be. Over the last year he underwent a regimen of grueling treatments. Throughout dozens of Judiciary Committee hearings and voting sessions on difficult topics, he and I sat side by side, month after month, as his treatments progressed. He slowly lost his hair, but he never lost his grit, his sense of fairness or his respect for the Senate and its special role in our system of Government. Nor did he lose his legislative skill, or his humor. Then, and now, he has maintained for himself, and for our committee--a brisk schedule, fueled by an energy level that would be daunting to many who are half his age. He has all of the vigor of his earlier days, and maybe more. His hair is back, and if I may say so, he looks better than ever. He is an inspiration to us all, and his example is a particular inspiration to millions of victims and survivors of cancer, and their families, across the Nation. I value the partnership that he and I have forged over the years, and especially during the time that he has been our committee's chairman. One product of our partnership is the asbestos trust fund bill that is now before the Senate. Bringing this bill on its long journey to the Senate floor has required unending commitment and effort. I have been proud to work with him on this project, and I applaud him for all he has done to bring the bill to this point. I commend to the attention of our colleagues an editorial about Senator Specter in today's edition of The Hill newspaper. I ask unanimous consent that the editorial be printed in the Record.

Mr. LEAHY

Mr. LEAHY. Mr. President, will the distinguished Democratic leader allow me 20 seconds to refer to what the distinguished Senator from Pennsylvania just said? Mr. President, the distinguished Senator from Pennsylvania is my friend--a friend from the days when we were prosecutors together. I am very touched by what he said. The Judiciary Committee handles some of the most difficult issues there are. I enjoy working with him because of his own ability and because of that friendship.

Mr. LEAHY. Mr. President, I ask unanimous consent that the order for the quorum call be dispensed with.

Mr. LEAHY. Mr. President, this evening, Senators will finally have the opportunity to vote to consider legislation which has been publicly debated and considered for several years. It is a bipartisan bill that is the product of lengthy and conscientious negotiation. We have held dozens of public hearings and committee markups. It has been an exemplary process. I see the distinguished Senator from Pennsylvania in the Chamber. He has arranged--I have lost count of the number of meetings where people from across the spectrum, political and otherwise, have had a chance to be heard--businesses, victims, labor, industry, everybody. It has been a great process. But with every day we delay consideration of this bill, victims are dying and more companies are going bankrupt. Both are tragedies for the families and victims, as well as for the workers and retirees and for the families who built these companies. The time has now come to pass this legislation. Victims have been waiting long enough for a comprehensive national solution. I hope all Senators will support the motion to proceed to this legislation. It has earned the support of many organizations that represent the victims of serious asbestos exposures. Asbestos disease has tragically weighed heavily on one group in particular--our Nation's war veterans. These brave veterans are unable to receive compensation under our current system, and they have asked Members of Congress--both parties--over and over again for help. The Military Order of the Purple Heart noted in its last letter of support that ``the FAIR Act is the only viable solution for sick veterans.'' We all speak of our support of veterans, as we should; all Americans should. That should not be partisan. But here is one way to help a class of veterans who are not going to get any help otherwise. More than 30 organizations representing veterans, as I noted on the floor yesterday, have supported this piece of legislation. But we have also received renewed letters of support from the International Association of Heat and Frost Insulators and Asbestos Workers Union, the International Union of United Automobile, Aerospace and Agricultural Implement Workers, otherwise known as the UAW, and the International Union of Painters and Allied Trades. They represent literally hundreds of thousands of families who have suffered. They support this because, as they say, they are ``firmly convinced it would be far superior to the current tort system in compensating the victims of asbestos-related diseases.'' It has not been easy getting to this point. It has taken years and years of work. It is not line for line the bill I would have written; it is not line for line the bill the distinguished Senator from Pennsylvania, Mr. Specter, would have written. Both of us went in with the idea that we would find a bill that would get the broadest support possible but also a bill that would help as many victims as possible. I believe this does it. Think of what is going to happen if you are going to have thousands of people who never get help and dozens more companies go bankrupt on top of the 70 that have already gone bankrupt. Supreme Court Justices as diverse in philosophy as the late Chief Justice William Rehnquist and Justice Ruth Bader Ginsburg have pled, publicly pled with the Congress to come up with legislation to solve this problem. Right now, litigation--many times--helps only those litigators, both defense and plaintiff, and very little help to the companies or the victims. The problems we are addressing are complex. This bill necessarily reflects these complexities. Drafting was not easy. The compromises we had to make were difficult but necessary to ensure that we created a trust fund that would provide adequate compensation to the thousands of workers who have suffered and continue to suffer the devastating health effects of asbestos. The tragic history of asbestos use in our country has to come to an end. We Senators first and the other body next have the chance to bring this to an end. The President has said he would sign such legislation if we can pass it. This is not a Democratic or Republican issue; this is an issue for all Americans. I join with the President, I join with my Republican colleagues, and I join with my Democratic colleagues who have supported this. In fact, under a provision authored by Senator Murray of Washington State which we have included, which was accepted during the last Congress by the Judiciary Committee, this bill will ban the maintenance and distribution of asbestos. This whole thing can come to an end so victims can get help. We have to halt the harm asbestos creates, and we have to ameliorate the harm it has already caused. The industrial and insurer participants in the trust fund will gain the benefits of financial certainty and relief from the stresses of litigation in the tort system, and victims will have a quicker and more efficient path to recovery. Chairman Specter, Senator Feinstein, Senator Baucus, and my colleagues from both sides of the aisle on the Judiciary Committee are working hard with me on this bipartisan legislation. Let this go forward today. Let us bring this to a halt. Help us bring surety. I urge Senators to let us move toward solving this problem by considering our bipartisan bill to at long last help solve the asbestos problem by providing fair compensation to victims of asbestos exposure. I suggest the absence of a quorum.

Mr. LEAHY

Mr. LEAHY. Mr. President, I ask unanimous consent then that after the distinguished Republican leader, the distinguished Senator from Illinois be recognized.