The Lawsuit Abuse Reduction Act (LARA), versions of which have been discussed in this space for years, would reverse the 1993 gutting of Rule 11, the federal rule providing sanctions for baseless lawsuits, and would thus establish that lawyers, like other professionals, should expect to be responsible for compensating those they injure by negligence or worse. Early this month LARA won the approval of the House Judiciary Committee, but is unlikely to prevail (this term, at least) in the more Litigation-Lobby-friendly Senate. [Stier, ShopFloor; earlier here, etc.]
By a vote of 228-184 yesterday, mostly on partisan lines, the House of Representatives approved H.R. 420, the proposed Lawsuit Abuse Reduction Act (LARA). (“Tort Reform Legislation Passes House, Moves to Senate”, Insurance Journal, Oct. 28). The vote margin was about the same as last year (see Jun. 21 and Sept. 15, 2004), and, as with last year, Senate passage this session is considered a long shot. For more on the bill’s sound overall rationale, as well as its weaker aspects, see our earlier coverage. More: Stop the BS has posted a copy of the bill (Oct. 29).
The Lawsuit Abuse Reduction Act of 2004 didn’t pass (though it’s been reintroduced) but Rep. Sensenbrenner’s majority report for the House Judiciary Committee nearly gave us (well, okay, nearly gave Stuart Taylor, Jr.) the chance to make permanent legislative history (see footnote 81).
By a 229-174 vote, largely along party lines, the U.S. House of Representatives has passed the proposed Lawsuit Abuse Reduction Act, sponsored by Rep. Lamar Smith (R-Texas); it now goes on to an uncertain future in the Senate. (see Point of Law Sept. 9, Aug. 17, Jun. 21; this site, Jun. 21). (Bloomberg, Reuters, AP). The bill would restore the stronger Rule 11 standards which used to entitle victims of meritless litigation in federal court to recompense in the form of sanctions: a previous Congress, following a major push by the litigation lobby, gutted Rule 11 in 1993. A source on Capitol Hill who is in a position to know suggests that we might want to provide a link to the House Judiciary Committee Report on today’s bill, the Lawsuit Abuse Reduction Act. “The report compiles in one place a ton of information on the problem of lawsuit abuse, with many of the examples of frivolous lawsuits drawn from your Web site”. And indeed, a quick glance at several sections of the report suggests that we did serve as an important source of material, for which we’re grateful.
Between 1983 and 1993, federal courts maintained relatively strong rules authorizing the levying of sanctions against lawyers or clients who pursue ill-grounded lawsuits, pleadings, motions or defenses. In 1993, following a quiet but determined lobbying campaign by organized litigation interests, Congress more or less gutted those rules, making sanctions much harder to obtain. Reinvigorating Rule 11 has long been high on our list of reform priorities, so we’re glad to see that Rep. Lamar Smith (R-Tex.), who chairs the House Judiciary subcommittee on courts, last week announced that he was introducing a bill entitled the Lawsuit Abuse Reduction Act, restoring a strong Rule 11. According to the Congressman’s Jun. 15 press release, the bill (begin direct quote):
* Makes sanctions against attorneys or parties who file frivolous lawsuits mandatory rather than discretionary;
* Removes a “safe harbor” provision that allows plaintiffs and their attorneys to avoid sanctions for frivolous suits by withdrawing them within 21 days;
* Allows sanctions for frivolous or harassing conduct during discovery, which is the phase of litigation where parties disclose documents;
* Permits judges to order plaintiffs to reimburse reasonable litigation costs, including attorney?s fees.
(end direct quote). According to the release, the bill also contains a provision to curb forum-shopping, and “[e]xtends Rule 11 sanctions to state cases that affect interstate commerce”. The last-mentioned clause sounds more than problematic from a federalist point of view, but presumably can be left on the cutting room floor at some point so that the other provisions can be considered on their own merits. More: Point of Law, Aug. 17.