Senate Defeats Federal Product Liability Law : Legislation: The close vote on the business-backed bill means that the fight will resume in the next Congress.
The Senate narrowly rejected a business-backed measure Thursday that would discourage people injured by defective products from suing the manufacturers for damages.
Supporters fell two votes short of the 60 votes needed to cut off debate on the measure, effectively killing it for this year. But sponsors said they were nonetheless encouraged by the 58-38 vote, which virtually ensures that the fight over product liability laws will resume in the next Congress. The vote, the Senate’s first ever on a federal product liability law, came less than a month after President Bush and Vice President Dan Quayle made trial lawyers a campaign issue by blaming them for high court costs and verdicts that they said hurt American competitiveness.
During a two-day debate, Republican sponsors of the proposed product liability law picked up the theme. “Today’s product liability system . . . is a severe drain on the U.S. economy . . . (but) is basically a job boon for lawyers,” said Sen. Robert W. Kasten Jr. (R-Wis.).
But critics said the Republicans were using lawyers as a smoke screen for an attempt to protect big corporations at the expense of people damaged by such products as asbestos, silicon-gel breast implants or the Dalkon Shield birth control device.
For more than a decade, manufacturers, physicians and small-business owners have waged a state-by-state campaign to limit the right of injured people to sue for damages.
This year, the National Assn. of Manufacturers and other business groups decided instead to seek passage of a federal measure that would restrict state laws involving defective product claims.
In the debate, the two sides offered dramatically different data on the U.S. legal system. Kasten, citing figures used by Quayle, estimated that the liability system costs American business $80 billion in direct costs and $300 billion in indirect costs.
But consumer advocate Ralph Nader said a detailed study of the insurance industry shows that companies pay out less than $2 billion per year to injured people. Product liability cases have dropped from 8,268 in 1985 to 4,992 in 1991, he said.
The proposed bill would have made a series of legal changes that would have discouraged trials and protected drug and aircraft makers from punitive damage verdicts.
For example, under current laws, an injured person typically obtains a lawyer with the understanding that the lawyer gets paid only if the victim recovers money from the company or the person being sued. Under the proposed bill, an injured person who rejects a settlement offer from a manufacturer and goes to a trial would have to pay the company’s cost for its lawyers if the jury awarded the injured party less money than had been offered.
