Clinton Vetoes Bill to Limit Product-Liability Lawsuits

President Clinton, delivering on a promise to plaintiffs’ attorneys and some consumer groups, vetoed a bill Thursday that would limit damages in product-liability lawsuits.

Rejecting a measure that passed Congress by large bipartisan majorities in March, Clinton said the bill “tilts against American families and would deprive them of the ability to recover fully when they are injured by a defective product.”

Republicans immediately seized upon the veto as evidence Clinton is beholden to one of his most generous groups of backers--the lawyers who bring suits claiming damages from faulty products.

Even before Clinton vetoed the measure in an Oval Office ceremony, Senate Majority Leader Bob Dole, the putative Republican presidential nominee, issued a press release accusing the president of being in the pocket of the plaintiffs’ bar.

“America’s legal system is broken and fundamental reforms are needed, and needed now,” Dole said in the statement. “Unfortunately, with today’s veto, the president will be confirming what we already suspected: It is the trial lawyers who are calling the shots at the White House.”

Knowing that his action would provoke a political backlash, Clinton at times sounded defensive in explaining his reasons for vetoing the product-liability bill.

He acknowledged that the courts are clogged with frivolous lawsuits that drive up the cost of many products and services. He said he too believes that the nation’s civil law system needs significant reform. He added that he is willing to sign some version of product-liability reform--but not the “extreme” bill sent to him earlier this week by Congress.

“I am eager to sign legislation to make our legal system work better at less cost in a fairer way, but this bill would hurt families without truly improving our legal system,” Clinton said, as several opponents of the bill stood by his side.

“It would mean more unsafe products in our homes. It would let wrongdoers off the hook. I cannot allow it to become law,” Clinton said.

Clinton invited several citizens to join him as he vetoed the bill, including a woman whose daughter was killed in a school bus accident, a woman widowed when a tractor rolled over and crushed her husband, and Sarah Brady of Handgun Control Inc. Among other provisions, the bill exempts gun makers from liability suits filed by people injured by firearms.

The idea of limiting damage awards in product suits has been before Congress in various forms for nearly 15 years. The current bill, whose sponsors include moderate Democratic Sens. Joseph I. Lieberman of Connecticut and John D. “Jay” Rockefeller IV of West Virginia, would cap punitive damages in most liability cases at $250,000 or twice the actual damages, whichever is greater. In the case of businesses with fewer than 25 employees, the cap would be the smaller of $250,000 or an amount that is double the compensatory damages.

The bill’s supporters--including virtually all manufacturers, business groups and the tobacco industry--argued that it would lower the cost of doing business by cutting insurance costs and capping excessive damage awards from sympathetic juries.

Clinton signaled in mid-March that he intended to veto the bill.

But the House passed the measure, 259 to 158; the Senate approved it, 59 to 40. Neither margin is great enough to override Clinton’s veto.

On Thursday, the U.S. Chamber of Commerce, a leading proponent of the liability bill, called the veto a “defining issue” for Clinton.

“It shows that he is more interested in his campaign contributors--a few thousand trial lawyers--than the American people,” said Bruce Josten, senior vice president at the chamber.

Lawyers and law firms are the top financial backers of Clinton’s reelection campaign, contributing more than $2.5 million last year.

The Assn. of Trial Lawyers of America responded that business groups supporting the product-liability bill contributed $26.2 million to members of Congress in 1994-95, nearly 10 times what the trial lawyers’ group gave lawmakers.

Citizen Action, the nation’s largest consumer group, praised Clinton for his action.

But 29 corporate leaders who supported Clinton in 1992 blasted the president.