Michael Oxley

Mr. OXLEY

Mr. OXLEY. Mr. Chairman, may I inquire how much time I have remaining?

Mr. OXLEY. Mr. Chairman, I yield 30 seconds to the gentleman from Minnesota [Mr. Ramstad].

Mr. OXLEY. Mr. Chairman, I yield 30 valuable seconds to the gentleman from Ohio [Mr. Chabot].

Mr. OXLEY. Mr. Chairman, I yield 1 minute to the gentleman from Florida [Mr. McCollum]. (Mr. McCOLLUM asked and was given permission to revise and extend his remarks.)

Mr. OXLEY. Mr. Chairman, I yield 1 minute and 30 seconds to the gentlewoman from New York [Ms. Molinari].

Mr. OXLEY

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

Mr. OXLEY. Mr. Chairman, I rise in support of the Common Sense Product Liability and Legal Reform Act. Product liability reform has occupied the Subcommittee on Commerce, which I chair, for almost two decades. It is testimony to the strength of the opposition that never before has this House considered comprehensive liability reform, but a new day has dawned. Let those who wish to defend the status quo do so, but my sense is that the American public is far ahead of them on this very important issue. Members of both the majority and the minority parties have worked hard for many years on product liability reform, and at least success is in sight. Our bill comes to the floor today under the able leadership of Chairman Bliley, and I commend him for his efforts. I thank the ranking committee member, my friend from Michigan, Mr. Dingell, for his leadership on this issue over the many years. I know he is frustrated by both the pace and the process of this bill, but I commend the gentleman for his commitment to reform, which has remained constant through these years. I also want to thank the gentleman from Louisiana [Mr. Tauzin], my ranking member, again for his excellent work in this area. I also want to thank the Committee on Energy and Commerce staff who has worked long and hard, Doug Bennett, Robert Gordon, and Hugh Halpern for the majority, David Tittsworth for the minority, for their constant and hard work as well. My colleagues on both sides of the aisle know that the product liability system in America costs the people of this country dearly. We pay more for products, we are denied life-saving medicines, we force companies to lay off workers, and we suffocate innovation. Just listen to the numbers. Because of product liability exposure, 47 percent of American manufacturers have withdrawn products from the U.S. market; 39 percent have decided not to introduce new products; 25 percent have discontinued new product research. These decisions hit consumers, and it hits them hard. The Conference Board reports that again as a direct result of existing product liability laws, 36 percent of American manufacturers have stopped some manufacturing; 15 percent have laid off workers; and 8 percent have closed plants. What does our product liability system offer American workers? Lost jobs and lost opportunities. Mr. Chairman, opponents of this legislation have portrayed the bill as anticonsumer. Nothing could be further from the truth. The status quo is anticonsumer and antiworker. America's liability system is a huge liability to American and its workers. The bill before us today is effective, it is fair, and it is long overdue. It protects the right of those injured by defective products to recover all damages, both economic and noneconomic. It puts an end to the abuse of punitive damages and provides a reasonable statute of repose. Manufacturers will be encouraged to innovate and compete and sellers of products will no longer face unlimited punishment for sins they did not commit. H.R. 956 loosens the self-imposed strangled hold our liability system places on the American economy. Mr. Chairman, I do not want to take a lot of time, so I will close with the words of Francois Castaing, vice president of engineering for Chrysler Corp. It is well understood that product liability laws have a purpose. They are supposed to compensate for injury, promote safety and penalize gross negligence. If a corporation is irresponsible, it should be held accountable. But the situation in the United States has gone beyond punishing gross negligence. Now punishment is meted out for many risks that simply cannot be avoided when a product is produced and sold to a public that has wide discretion in how it chooses to use that product. When no distinctions are made in assigning responsibility for risk and all companies are held responsible--and penalized--for all risk, the ability to innovate, engineer, and compete is compromised. Mr. Chairman, I am in strong support of this legislation. We have worked on this for a number of years in our committee. I think the efforts by the Committee on the Judiciary and our committee have brought us here today, where we can pass an outstanding bill with a good, strong, bipartisan support. I would say to those who would continue to defend the status quo, that the burden of proof is on you to prove that the current system is not inimical to the American worker.

Mr. OXLEY. Mr. Chairman, I yield 3 minutes to the gentleman from Washington [Mr. White], one of our outstanding freshmen.

Mr. OXLEY. Mr. Chairman, I yield myself 2 minutes. Mr. Chairman, I was struck with the discussion we have had this evening and hark back to our hearing on the product liability issue in which the representative trial lawyers testified that they were, of course, opposed to Federal legislation in this area. I reminded him of the time when in Ohio, not too many years ago, the Ohio trial lawyers appeared in testimony before the Ohio General Assembly and said that they felt that it was the province of the Federal Government to deal with a national problem like products liability, and indeed the States, if they were to pass 50 different statutes, would be a hodgepodge that would never solve the problem. It seems to me a rather interesting dichotomy that we hope to address in this Federal legislation. It is imperative, it seems to me, based on what we have heard in the committee, in the committee of the gentleman from Illinois [Mr. Hyde], to really provide a national standard for those goods that are sold in interstate commerce, and indeed over 70 percent of the goods that are manufactured in this country are sold in interstate commerce. And so it behooves us in the Congress to set those Federal standards, and that is exactly what we propose to do in this particular piece of legislation, and I would urge that my colleagues do likewise. Mr. Chairman, I reserve the balance of my time.

Mr. OXLEY. I want to commend the gentleman for his statement and to point out the fact that we are making these plaintiffs whole; that is essentially the idea behind the law, is to make them whole. And I appreciate his statement because I think it really highlighted exactly why we are here today and I congratulate the gentleman on his statement.

Mr. OXLEY

Mr. OXLEY. Mr. Speaker, I ask unanimous consent that the following committees and their subcommittees be permitted to sit tomorrow while the House is meeting in the Committee of the Whole House under the 5- minute rule. Committee on Banking and Financial Services; Committee on Commerce; Committee on Economic and Educational Opportunities; Committee on Government Reform and Oversight; Committee on International Relations; Committee on National Security; Committee on Resources; Committee on Science; Committee on Small Business; Committee on Veterans' Affairs; and Select Committee on Intelligence. It is my understanding that the minority has been consulted and that there is no objection to these requests.

Mr. OXLEY

Mr. OXLEY. I thank the gentleman for yielding this time to me, and I rise in support of the rule as well as H.R. 1058. Our committee has worked long and hard on providing for a reasonable set of rules that these kinds of debates can take place. I think we have achieved that. I want to pay particular tribute to the gentleman from Texas, the chairman of the Subcommittee on Telecommunications and Securities, and also to the gentleman from California [Mr. Cox], and my friend from Louisiana, who has really been the godfather of this provision for a number of years. We appreciate his ability to work with the majority in crafting what I think is a very effective bill that will start to get some common sense back into our legal process and at the same time permit people who are truly aggrieved to pursue their claims in court. I thought the debate in the committee was lively, informative, and I suspect the same thing will occur on the floor during general debate and the amending process. Securities litigation reform is a bill whose time has come. It is a provision that will allow for, I think, some dealing with securities litigation that is long overdue. Numerous groups throughout the country support this effort. We think that those companies that are just starting out, entrepreneurial companies particularly, are highly vulnerable to these kinds of strike lawsuits. That is exactly what this bill tries to mitigate and to change. I think the gentleman is correct, the rule is proper, and the bill is a good step in the right direction and true commonsense legal reform. Mr. Speaker, today I rise in strong support of H.R. 1058, The Securities Litigation Reform Act. Is there a person in this Congress or in this country who honestly believes that our current system of securities fraud litigation does not require serious and immediate reform? H.R. 1058 is the answer. As we speak, a strike suit plague is devastating our Nation and crippling American competitiveness. Unprincipled lawyers are spreading this plague at an alarming rate. One firm in particular files a strike suit every 4.2 business days, and 1 of every 8 companies listed on the New York Stock Exchange has been crippled by strike suits. While these lawyers claim to sue in the name of the investor, a number of recent studies show otherwise. For example, the National Economic Research Association has concluded that investors recover just 7 cents on every dollar lost. Their actual recovery is even lower. Plaintiffs' lawyers usually take one-third of all the settlement proceeds. The strike suit plague is forcing our companies to squander resources rather than devoting them to productivity and job creation. It stifles innovation and adds tens of millions of dollars to the cost of doing business. It is time we rid our countryside of this disease and cure our Nation's economy. Strike suits are devastating our Nation. A study by the Rand Institute of Civil Justice says excessive litigation--largely designed to coerce settlements from successful defendants--may cost our economy as much as $36 billion each year. All Americans pay a hidden litigation tax to subsidize the massive cost of strike suits. Some pay with their jobs, as workers are laid off in the wake of extorted settlements. Scores of other able-bodied Americans are never hired in the first place. Research and development and other investments that spur economic growth are slashed. Consumers pay higher prices for their goods and services. All of us pay the price for strike suits as the lawyers quietly walk away with fortunes in extorted settlements. It is time to rid our Nation of this strike suit epidemic. It is time for a litigation tax cut. I urge you all to support H.R. 1058 in the name of the fiscal health of all Americans.

Mr. OXLEY

Mr. OXLEY. I yield to the gentleman from Wisconsin.

Mr. OXLEY. Mr. Chairman, I move to strike the requisite number of words. Mr. Chairman, I rise in opposition of the amendment. We had a long debate about this provision and this amendment in the committee. It was defeated handily on a bipartisan vote. This is nothing else but a smokescreen, a red herring. Essentially it says, if the Markey amendment were to be adopted, then if you know anything at all about the subject matter at hand, then you cannot be on the peer review panel. You are essentially eliminated because you know something. It kinds of reminds me, Mr. Chairman, of the First Lady's Health Care Task Force, where to be qualified you did not know anything about health care or be a participant in any of the health care delivery systems. I would suggest to my friend from Massachusetts that the language of the bill is very clear on peer review. Let me read it to my friend. Peer review panels ``shall be broadly representative and balanced and to the extent relevant and appropriate, may include representatives of State, local, and tribal governments, small businesses, other representatives of industry, universities, agriculture, labor, consumers, conservation organizations, or other public interest groups and organizations.'' That is a pretty broad category that is included. Now, we had testimony from a Professor Lave from Carnegie Mellon who has served on numerous peer review panels. I asked the professor directly during the testimony exactly what happens to those folks who would be perceived as using that information to their own benefit or their company's benefit, and Professor Lave said ``We simply beat the H out of them.'' The point is that we, that the people who testified, virtually every individual who testified told our committee that the peer review process under this bill makes common sense, it allows people who know what they are talking about to participate in this, and that in fact this is the most appropriate way to get the broadest possible input into the peer review process.

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

Mr. OXLEY. Mr. Chairman, this would merely add to the priority- setting provision in title VI of the bill to require the President to consider public health priorities developed by State and local governments. The National Governors' Association recommended this amendment to me after it reviewed the bill. It gets the priority-setting process closer to where the priorities really are, at the State and local levels. This is noncontroversial amendment that I think improves the bill and is supported by the State governments. In support of my amendment, I would point out some language that exists currently in the bill in section 17, where we talk about guidelines in consultation with State and local governments, in section 109, study participants may include people from State and local governments, and then in section 202, no final rule shall be promulgated unless the incremental risk reduction would be likely to jeopardize the incremental costs incurred by State and local governments. I think, Mr. Chairman, you can see from the tenor of the language already in the bill that the amendment fits very well into the goals of the legislation where we take into consideration State and local governments. As I indicated, the National Governors' Association asked me to offer the amendment on their behalf, which I have done.

Mr. OXLEY. I yield to the gentleman from Pennsylvania [Mr. Walker].

Mr. OXLEY. I yield to the gentleman from Indiana [Mr. Roemer].

Mr. OXLEY. I thank the gentleman.

Mr. OXLEY

Mr. OXLEY. I am concerned that we get an overburdened effort. That is what the job is, it is for those regulators to make those regulations based on good science. That is what we want them to do. We do not want them to dump their problems into the Congress' lap. We are going to be authorizing Superfund, I say to my friend from California, we are going to be reauthorizing other programs, and that is clearly one of our goals. But it seems to me that in the overall scheme of things, we are dealing with regulations, this bill now, this bill now is a chance to get some common sense into that procedure, and then when we start to reauthorize these kinds of regulations and the regime that is used in the regulations, the regulators will be very used to them and they are going to be able to come up with a good response. (Mr. HAYES asked and was given permission to revise and extend his remarks.)

Mr. OXLEY. Mr. Chairman, I have perhaps less confidence that that particular procedure will work. If they report back, they report back. The gentleman from Michigan [Mr. Dingell] said he has had a lot of hearings about some of the abuses in the regulatory process. It is true we have had a lot of hearings, but until today we have not done very much about it. Today we have a chance to strike a blow for reasonable regulations. That is why this bill is so important, and that is why, in my humble estimation, the amendment of the gentleman from New York cripples our ability to do that.

Mr. OXLEY. I yield to the gentleman from New York.

Mr. OXLEY. Mr. Chairman, I move to strike the requisite number of words, and I rise in opposition to the amendment. Mr. Chairman, let us first of all make something very clear; that is, the supermandate language in this bill is [[Page H2362]] the guts of the legislation. If you are against the supermandate, you are against the bill; then vote for the Boehlert amendment. But if you want to have a reasonable risk assessment and cost-benefit analysis bill, then vote against the Boehlert amendment and vote for the bill. That is basically as simple as it can be. The gentleman from Louisiana [Mr. Tauzin] made it very clear, and he is right, that if you are against the bill, you want to vote for this amendment. So I think most Members recognize it is important we look forward in dealing with these kinds of legislation and give the opportunity for the Congress to set these kinds of standards. That is exactly what we get elected to do. I want to point out for the edification of the Members that we tried to carefully deal with the question that came up in our committee about mammography screening. The gentlewoman from California who has spoken earlier raised that issue. We worked very hard to make certain that that was taken care of. I want to stress that in the language in the legislation, on page 5, line 14, section 4: Program designed to protect human health. The term ``program designed to protect human health'' does not include regulatory programs concerning health insurance, health provider services, or health care diagnostic services. Now, the last time I looked, mammography screening would be covered under health care diagnostic services. So I put that issue to rest. We listened to the gentlewoman from California and others in our committee. That issue is not an issue in this amendment, nor is it an issue in this bill because we took care of it, as a result. Now, we spend some $430 billion to $700 billion on regulations. Does it not make sense, since we have already defeated an amendment that would look back that would keep us from looking back, to now take a look at an opportunity to take the new regulations that are coming out and apply reasonable cost-benefit analysis and risk assessment to those regulations? That really is the issue. The question is do you want to do that, or do you not? Do you want to stick with the status quo of these old regulations that are in many ways totally not based on science, or do we want to simply give regulators an opportunity to use good science? That is really what this is all about. Now, if we are going to believe our friend from New York, we are going to say we are just going to walk in place, we are going to, essentially, freeze the decisionmaking process and go back to what cost billions of dollars. I do not think that makes a whole lot of sense, and that is why the Boehlert amendment should be defeated, because it goes against the heart of what we are trying to do here, the very heart of this supermandate language.

Mr. OXLEY. Mr. Chairman, I thank the gentleman for yielding. He points out a very interesting issue that we are going to be dealing with, wrestling with in our committee as far as Superfund is concerned, and the gentleman is absolutely right. The cleanup standards are beyond belief. They have driven the cost of the Superfund Program skyward when we are not really getting the cleanup where needed. It is based on poor science, it is based on politics, it is based on scare tactics instead of real science. And this bill is to address those kinds of inconsistent, very expensive kinds of propositions in the regulations. So, if the amendment were to be adopted, it would destroy the ability to really solve the problem of these new regulations that are coming about. We want to do them by each program and we will be doing those within the Superfund Program, but obviously if you believe in the regulatory madness that is going on right now, you would support this amendment. I suggest quite the contrary, so I appreciate the gentleman pointing out the Superfund Program. It is an excellent example of these regulations run amok.

Mr. OXLEY. Mr. Speaker, this amendment really is not about the peer review process. That was dealt with in the Markey amendment. The Markey amendment went down as it should have. The provision in this bill provides for everybody of every interest, labor and environmental groups and business groups and everyone, to participate in the peer review process, and they have to report any potential conflict of interest. That is what makes this bill so strong. But really the opponents of this bill who are trying to hide behind the motion to recommit are worried about three strikes and you're out, changing a $25 million coverage to $100 million, changing the enforceable law in not allowing judicial review, and providing for prior law to prevent consideration and to change the risk and cost- benefit analysis. This is an effort to try to stifle the ability to change the way Washington works in its regulatory process. Members should vote against the motion to recommit.