Hatch Flogs Asbestos Legislation Past Doubting Specter and Judiciary Democrats Onto Senate Floor
July 10, 2003, Washington, D.C. -- Around nine p.m., the Senate Judiciary Committee on a near party line 10 to 8 vote passed to the full Senate's consideration S. 1125, the Orwellian-titled "Fairness in Asbestos Injury Resolution Act" (FAIR). Committee Chairman Sen. Orrin Hatch (R-UT) spent the long day flogging S. 1125 to a final vote out of the Committee, past cries that his Bill -- what he called "the most important piece of legislation of this century" -- violated the Constitution and fundamental fairness. Often imperious and at times downright rude to his fellow Committee members, Sen. Hatch made clear at the outset that the day's conclusion would be foregone, that S. 1125 would be voted out of Judiciary and onto the Senate floor, come hell or high water. Strong reservations expressed by Sen. Arlen Specter (R-PA) and others on the Democratic side of the aisle may just be the high water that capsizes the Bill in the full Senate. Hell for Hatch came late in the day in the form of Sen. Joseph Biden (D-DE). S. 1125 In A Nutshell, As Passed to the Full Senate I scribbled notes that day with the hope that I could read the tea leaves later and get some sense as to key Senators' thought processes and ways to stop S. 1125, which I consider a miscarriage of justice for those with mesothelioma and other serious asbestos-related illnesses. I welcome your thoughts. You may understand my notes better with a quick review of key provisions of the latest version of S. 1125 passed by Judiciary:
Day Before the Vote: Poore, Stoeckler Speak From Heart For Justice In the week leading up to the Judiciary Committee vote, my firm rallied its clients to write, e-mail, fax and call their Senators in opposition to the Hatch Act. (I was moved by the number of those who responded). My friends and colleagues Peter Kraus and Charles Siegel flew to Washington to lobby in the Senate. I got to know David Lipman, another mesothelioma advocate from Florida who used to work as a civil rights attorney in Mississippi in the 1960s. It doesn't do these good men justice to write that they were there just to lobby on behalf of clients, or, as Sen. Hatch repeatedly suggested, their livelihood. They were there because their hearts are in the right place, as human beings and (I am not ashamed to write) as lawyers. They passionately believe not only that S. 1125 grossly violates the rights of seriously injured asbestos plaintiffs, but also represents a large part of a concerted attempt by Big Business (including the insurance industry) to eliminate the fundamental right held by individual Americans to a civil jury trial. I was proud to be there with them. * * * I was also proud to be there with Colette Poore and Chris Stoeckler, two clients who delivered prepared statements to the press on the day before the July 10 vote and made themselves available for questioning. (None from the media dared).
Both displayed extraordinary grit and courage. For Colette, the trauma of her husband's death from mesothelioma on October 4, 2001 remains noticeably fresh. Hours before the elementary school teacher was to speak, her right hand was shaking uncontrollably. Her eyes reddened as she listened to the other speakers denounce the Hatch Bill. She steeled herself but it was very difficult for her to speak of the excruciating pain Randy endured before his death. Click on http://www.mesothel.com/pages/poore.htm Colette got through her statement, but the thing which most impressed me about her was the way she walked up to Sen. Hatch during a break in the next day's proceedings and introduced herself as the widow of a mesothelioma victim. She had the guts to walk up to one of the most powerful politicians in the country, and let him know she knew what he was up to and she was going to fight back. Hard to believe that Sen. Hatch really cared or even heard what Colette said in his rush to get his Bill onto the Senate floor. In sharp contrast, Sen. Richard Durbin (D-IL), obviously moved by his meeting on July 9th with the widows of two mesothelioma patients, kept invoking the women as he introduced measure after measure to soften the blow of S. 1125 on those hardest hit by asbestos, those with mesothelioma. One of the women Sen. Durbin met with on the 9th was Colette Poore. * * * Forty-one year-old United Airlines mechanic Chris Stoeckler flew into D.C. from his home in Wisconsin with his wife Wendy and 10 year-old daughter Taylor on July 8. He was in pain. His tumor as he puts it is "wrapped around both of my lungs, my heart and my belly." He was diagnosed with mesothelioma on New Year's Eve, 2001, but he has had symptoms since 1999. Click on http://www.mesothel.com/pages/stoeckler.htm. Since his diagnosis, Chris has undergone a dizzying array of chemotherapies, and most recently radiation therapy. He continued to work as a mechanic for United Airlines until about four weeks ago, when radiation sickness finally conquered his drive to provide for his family. Just a few years ago he rode in grueling and physically demanding motocross competitions.
On July 9, 2003, his face gaunt and much older-looking than his years, the mechanic stood before the D.C. press, his voice raw with emotion, and said he was just trying to hold on until October 13, the day his case is set for trial. He said even if he and his family won compensation at trial through a jury verdict, that would all be taken away under the Hatch Bill and continued, "I don't know much about the law, but that doesn't seem right to me." No one challenged Chris on this or any other point; no one had the right, the standing, which Chris had earned with his sheer capacity for pain. Click here for the full text of Chris Stoeckler's statement. Wisconsin is unusual in that both of its Senators serve on the Judiciary Committee. Arrangements had been made in advance for Chris, Wendy and Taylor to meet with Sen. Herb Kohl (D-WI) after the press conference. Sen. Kohl was, as Chris says, "a regular guy" who told jokes and asked a number of questions about his mesothelioma and concerns about the Hatch Bill. David Lipman also arranged on very short notice for a meeting between the Stoecklers and Sen. Russell Feingold (D-WI). The Stoecklers were thankful that their Senators made time to meet with them face-to-face and hear them out. Both Sen. Kohl and Sen. Feingold voted to kill the Hatch Bill in Committee. Chris paid the price for his fight against the Hatch Bill. He was in so much pain from his trip that he had to be hospitalized shortly after his return to Wisconsin. "Rough Cut Justice", Or Let's Do Something -- Get "The Most Important Piece of Legislation of This Century" Out of Committee -- Even If It's Wrong! No Judiciary Committee member from either side of the aisle openly questioned the need for a federal asbestos trust fund. No one mentioned the registry for unimpaired asbestos claimants, as proposed in legislation last year by Sen. Don Nickles (D-OK) 1 . Needless to say, the narrow framework for dialogue was disappointing, but we can only hope to fight that battle another day. Instead, Thursday's tug-of-war concerned whether S. 1125 strikes a just compromise between providing "certainty" to asbestos defendants and swift, certain, "fair" compensation to asbestos claimants deprived by the Bill of the fundamental right to a jury trial. Beyond the apparent evenhandedness of Sen. Specter, I was most surprised by the speed and volatility of the Judiciary Committee's decision-making, apparently unfolding publically and with a shocking lack of deliberation. As Sen. Patrick Leahy (D-VT) said, he was "sobered by the complexity" of the Bill and the issues it dealt with. Yet amendments with profound impacts on the Bill's funding mechanisms and indeed the national economy were passed in little more time and with little more sophistication than a Town Board meeting. I mean no disrespect to any Town Board, but I expected more from the United States Senate. My notes follow. Sen. Hatch opened the Judiciary Committee hearing around 9:30 a.m. by stating, "This is perhaps the most important piece of legislation of this century." In blunt terms, he repeated his intent to pass the Bill out of committee "today -- even if we have to stay here all night." Sen. Diane Feinstein (D-CA) enumerated her concerns with the Bill.
Sen. Feinstein ended her opening statement by noting the large corporations in California who face massive liabilities if there is no bill and said, "I want to vote on [in favor] of this Bill, but there's more work to be done." Sen. Hatch replied that he felt agreement had been reached on claims values and decried the "poison pill" amendments which could only kill his carefully crafted compromise bill. He referred to one such poison pill, the Leahy/Kennedy amendment, which would add $34 billion to the initial 27 year corpus. Sen. Hatch then went off on an anti-trial lawyer rant until Sen. Leahy arrived. Sen. Leahy said that the priority of the Bill should be to compensate victims and not provide a windfall to corporations. He mentioned the rising stock prices of certain corporations which would benefit from the Bill, without mentioning Halliburton. (Halliburton's stock had indeed risen the day before). He said that the Leahy/Kennedy amendment would require a reasonable $128 billion fund with fair award values. Sen. Leahy also said "We shouldn't lock the courthouse doors until we're ready to process claims," adding, "I'm committed to getting an asbestos bill, but not any bill." He pleaded for more time for further work on the Bill, warning, "A party line vote today means the Bill will not survive on the Senate floor." Sen. Specter provided the first jolt of the day by dryly announcing, "I have reservations about the Bill." He cited concerns that there would be no trust funds available for dispersal until around 2005. He had questions regarding the rights of third parties to subrogation of trust funds. Stating that pending asbestos lawsuits present a difficult consitutional question, he proposed having a retired but amenable 4th Circuit Judge review the Bill with regards to its constitutionality. Sen. Specter mentioned that the United States Supreme Court upheld Judge Becker's ruling that CCR's attempt to impose a class action settlement on asbestos plaintiffs was unconstitutional. Sen. Specter ended his remarks by asking, "What happens if the fund runs out of money?" Sen. Durbin followed Sen. Specter's remarks by stating that his main concern was the speed of compensation to mesothelioma claimants. He said he met with the widows of two mesothelioma victims the day before. He then noted that there are about 7,000 pending mesothelioma lawsuits, an initial $8.6 billion available for the first year, and thus if mesothelioma claimants were paid $1 million each within a year of creation of the trust, most of the fund would be depleted in its first year -- leaving many other deserving claimants such as lung cancer victims unpaid.
Having heard the grave concerns expressed by Senators Feinstein, Leahy, Specter and Durbin, Sen. Hatch took issue, at one point making the bold (and false) assertion, "Three to five years to deliver compensation [under the Hatch Act] is as good as the California court system could deliver [to a mesothelioma plaintiff]!" Senators Hatch and Feinstein argued this last point, Sen. Feinstein at one point asking, "Have you ever been to court in California?" Hatch said he had not. Sen. Edward Kennedy (D-MA) joined the fray, responding to Sen. Hatch's anti-trial lawyer tirade. He said that lawyers did not create the asbestos crisis -- asbestos poisoning did. (God bless Teddy for pointing out that plaintiff's lawyers were, at least once, heroes to those poisoned by asbestos). He said that removing transaction costs (e.g., plaintiff and defense attorneys' fees) should neither reduce awards for the seriously ill nor provide a windfall to corporations. He took issue with a $150,000 award to a non-smoking lung cancer with long-established asbestos exposure as "outrageously low." He also felt that cases presently in the tort system should be left there to ease the transition. Sen. Hatch called a vote on the Leahy/Kennedy amendment to increase the initial 27-year fund to $128 billion. The amendment fell on a 9 Democrats aye, 10 Republicans nay, straight party line vote. After an afternoon break, Sen. Jon Kyl (R-AZ) introduced an amendment that would change the wording of a portion of the Bill to indicate that "substantial occupational exposure" would have to be "significant." This was not the only time Sen. Kyl made remarks which I found incomprehensible. Sen. Hatch then reached out to Sen. Feinstein, saying she is the most serious, hard-working Senator on the Democratic side of this issue. Their eyes locked in a mutual exchange of camaraderie and sincerity. Sen. Leahy interjected in his grandfatherly manner that all of the Senators on the Judiciary Committee and their staffers had been working extremely long hours on the Bill. He said he was "sobered by the complexity" of the Bill and its issues, and again pleaded, "We should not try to do on the [Senate] floor what should be done in Committee." Sen. Lindsey Graham (R-SC) asked whether raising one set of values from $20,000 to $30,000 would really change those recipients' lives, particularly as this would doubtless come at the expense of the seriously ill. Sen. Hatch raised his amendment to undo default judgments obtained against insurers (sic), without opposition from asbestos defendants acting in "collusion" with plaintiffs' lawyers. He said these judgments were "not tested by an adversarial" process. He said that the insurers necessary to the viability of the Bill were opposed to the Feinstein/Kohl amendment to exempt pending claims from the Hatch Act, and to the amendment to exempt Halliburton and Honeywell settlements from the Act. Sen. Durbin said he was disturbed by the pending settlements nullified by the Bill. He proposed that mesothelioma cases filed before introduction of the Bill should be carved out.
Sen. Hatch rebutted Sen. Durbin by stating that [renowned constitutional scholar and Harvard Law Professor] Lawrence Tribe found the bill to be constitutionally sound. Sen. Hatch then introduced an amendment adopting Sen. Feinstein's compensation values, which were larger for lung cancers, and giving administrators of the trust discretion to go down to Hatch values if the $108 billion/$147 billion (sic) corpus was endangered. Sen. Leahy, responding to Sen. Hatch's amendment to undo default judgments, said that under the current law of all 50 states and Puerto Rico, default judgments can be disrupted upon a showing of fraud, and thus there was no need for the Hatch default amendment. Leahy repeated that the Committee needed to focus on "fair compensation for victims." Sen. Kyl invoked what he claimed was an Old West phrase and called the Bill "rough cut justice (sic)." He tried to justify shortchanging asbestos victims by implying that asbestos defendants in many instances would not have had any liability. [Logically, Sen. Kyl's assertion is absurdly unpersuasive, as this is a tautology -- of course, under a no-fault, universal fund system, there are many defendants who would not have to pay when considering individual plaintiff's cases.] As the debate returned to issues of pending settlements, unconstitutional takings of property and fundamental fairness (namely, grumblings about the sweetheart deal S. 1125 represents to Honeywell and Halliburton), Sen. Hatch remarked that Honeywell and Halliburton have not entered into "final settlements." (Of course, Sen. Hatch was being disingenuous; while it is true that neither corporation has finalized settlement of the prepackaged bankruptcies of subsidiary asbestos companies, Sen. Hatch neglected to mention that those subsidiaries had entered into binding, final settlements with tens of thousands of asbestos litigants). Sen. Saxby Chambliss (R-GA) said that structured, final settlements should be exempt from the Hatch Bill. By the same token, those who have had their day in court and lost should not get to participate in the system. (This was one of many Republican references to "double dipping.") During a 5 p.m. break, Senators Graham and Feinstein worked on new compensation values. They proposed taking $6 billion from two categories of the less seriously injured and shifting these funds to lung cancer claimants. The Graham/Feinstein amendment was still based on the initial $108 billion, 27-year fund with the accompanying $45 billion contingency fund.
Sen. Leahy said that the Graham/Feinstein amendment was "a step in the right direction," but still not fair enough to asbestos victims. Sen. Durbin said that he would support the Graham/Feinstein amendment, but felt that the Leahy/Kennedy amendment (an initial $128 billion plus the $45 billion contingency) "gets justice for victims". The Graham/Feinstein amendment was called to a vote and passed by 14 ayes, 3 nays. Sen. Hatch returned to his amendment #89, regarding voiding default judgments obtained by asbestos plaintiffs, supposedly working in collusion with asbestos defendants to inflate claims against the defendants' insurers. Sen. Leahy asked, "How much in default judgments are we talking about?" Sen. Feinstein, aides scurrying about, pronounced that 7,000 people have settled with Western MacArthur and are waiting it to pay [if and when its insurers concede liability]. Sen. Specter suggested that amendment #89 be tabled for analysis on the floor, with Sen. Hatch's consent. Sen. Leahy introduced an amendment to ensure that the actual initial fund would be $108 billion, rather than the $92 billion used as the basement number for accounting analysis. The amendment passed without objection. Sen. Feinstein introduced an amendment to "carve out" final judgments and settlements from the Hatch Bill. (The Senators seemed unaware of the unfortunate irony of using this term from butchery). Sen. Kyl responded, "We need to not piecemeal this -- if we carve out settlements, we need to give those companies with pending settlements offsets." Sen. Hatch warned that the Feinstein amendment to carve out judgments and settlements would carve out money necessary to support the whole Hatch bill. He then accurately pointed out that "final judgments" not subject to further appeal are already outside the scope of the Hatch bill. Using at one point the phrase "settlements approved by the court", Hatch said that "final settlements" are not subject to the Hatch Bill. Again looking into Sen. Feinstein's eyes, he promised her that if "it's a final settlement, it will be paid." Glancing away, he said that the present language was designed only to bring pending bankruptcy settlements into the trust. He continued that the present language was "a problem" and that "final settlement" needed to be defined. Sen. Feinstein agreed to table her amendment to carve out final judgments and settlements. Sen. Feinstein then raised her amendment #92, which permits plaintiffs to go forward with tort claims until money from the Hatch trust was available. She said that under the Hatch bill as presently drawn, a purgatory for pending claimants is created. She cited the one-year timeline for creation of the insurance commission as an "aggressive timeline," in the sense that it will be difficult to meet. Sen. Specter chimed in that there was an appeal process for decisions made by the insurance commission which could add to the delay. Sen. Durbin interjected that he had an amendment that mesothelioma cases filed before introduction of the Hatch bill (May 22, 2003) would be permitted to be completed in the tort system. Sen. Feinstein agreed to amend her amendment #92, subject to two provisos stated by Senators Kyl and Graham. It was unclear to me whether this meant: (1) no "double dipping" (if a plaintiff loses, no resort to the Hatch trust) and offsets for asbestos defendants who get judgments against them, or (2) those two provisos plus a one-year stay from the date the Hatch bill becomes law. Sen. Hatch opposed Durbin's amendment to exempt mesothelioma cases filed before May 22nd. Durbin's amendment was killed on a 9 nay, 8 aye party line vote. Sen. Durbin, noting that under the Hatch Bill workers compensation claims can be filed as well as Hatch claims, proposed to delete the FELA (federal railroad employee) exclusion from the Hatch Bill. In effect, railroad workers could file FELA claims for lost wages, medical expenses and pain and suffering, as well as Hatch claims. Sen. Hatch opposed the motion, pointing out that FELA was not a "no fault" system like workers compensation. Sen. Specter said that if Durbin's amendment "is going to gut the bill, I'll oppose it; but if it's a small number of claims, I may support the Durbin amendment on the floor." He then asked if the Bill could allow provision of workers compensation-type medical expenses and lost wage benefits. Durbin's FELA amendment was killed on a 9 nay, 8 aye straight party line vote.
Around this time, Sen. Biden entered the hearing room, and from the moment he walked in he dominated the hearing. He had rock star quality. The room felt electric for the short time he was there. He spoke in a booming voice, in very blunt terms. He asked simple questions which penetrated through the fog of obfuscation Senators Hatch and Graham so skillfully shrouded over objectionable provisions of the Bill. In a very short period of time, Sen. Biden became my own personal favorite for President. I hope he runs. In sharp contrast, words cannot describe my disappointment in Judiciary Committee Member Sen. John Edwards (D-NC). Sen. Edwards made a very good living representing personal injury plaintiffs before entering politics. I understand he has great passion for ordinary Americans. But he apparently is so afraid that he will be labeled with the dirty phrase "trial lawyer" (now as much a conservative pejorative as "liberal") that he has been missing in action during the Hatch Bill debate. His chair at the hearing might as well have been empty. He could have won my support in the election by announcing he was proud to have been a trial lawyer, proud to have stood up for the rights of victims, and he was not going to stand mute while Sen. Hatch and others violated our system of justice. Edwards sat mute. Shortly after entering the room, Sen. Biden introduced an amendment which he described as "the back end" of the Feinstein amendment providing resort to the tort system until trust funds become available. Sen. Biden's amendment would provide escape to the tort system immediately if the 27-year trust fund runs out of money. He asked, "What if the fund runs out of money in 10 years? Are you saying a claimant will have to wait 17 years before being able to file a lawsuit?" Biden's amendment passed with 15 aye votes, including those of Senators Specter, Graham, Chambliss and Cornyn. Sen. Biden next introduced an amendment to make sure that small companies would have the right to appeal to the trust administrator if asked to pay excessively more into the fund than they would in the tort system. Sen. Hatch accepted the amendment, and Biden left shortly after. Sen. Feingold introduced an amendment to ensure that payment in full be made by the trust within three years of award. Sen. Hatch accepted the bill with the change that payment in full presumptively must be made within three years, no more than four. Sen. Leahy introduced his amendment #86, which would exempt claimants from being required to repay any insurance carrier. He said that as written, the Hatch Bill penalizes those with the foresight to buy medical and life insurance, and rewards those who do not. Sen. Leahy's amendment fell on a straight party line vote of 9 nays, 8 ayes, as did his amendment providing for increased medical monitoring for asbestos disease. Sen. Hatch then called for a vote on the Hatch Bill. Sen. Feinstein, perhaps feeling she had received firmer commitments from the Republican side regarding her concerns than she had actually obtained, broke ranks and voted in favor of the Bill. The Hatch Bill was voted out of the Judiciary Committee to full consideration on the Senate floor by a vote of 10 (9 Republican and one Democratic) ayes, 8 (Democratic) nays, and one pass (by Senator Kyl). Conclusions The keys to defeat of the Hatch Bill lie in answering the concerns expressed by Senators Specter and Feinstein. (Again, the framework for this fight is not an unimpaired registry, but Sen. Hatch's Bill). I feel that if those concerns are truly met, as many of the amendments of July 10 purportedly aim to do, the economic underpinnings of the Bill will explode, and no one -- the asbestos defendants, the insurance industry, or asbestos plaintiffs -- will support this Bill. We must aggressively expose the "fuzzy math" to the light of day. Sen. Specter joined Sen. Leahy in questioning the rush to get the Bill out of the Judiciary Committee. I sense that Specter holds constitutional due process concerns raised by such Hatch provisions as the nullification of settlement contracts and pending appeals. No one has even mentioned the issue of litigation costs, which can reach six figures once a mesothelioma case goes before a jury. When an individual has detrimentally relied on the civil justice system to that extent, and is then suddenly barred from reaching a final judgment through new legislation, does this constitute an ex post facto, unconstitutional taking? Does this violate the Constitution's equal protection clause by treating such persons differently than trust beneficiaries who have not gone through litigation? Senators Specter, Feinstein, Durbin, Biden and others expressed grave concern about the potential for lengthy delays in availability of trust funds, and the impact of such delays on the most needy, the families of those with mesothelioma. Sen. Feinstein's amendment dealt with "the front end" by permitting lawsuits to go forward until trust funds become available, and Sen. Biden's amendment dealt with "the back end" by permitting lawsuits to go forward if trust monies run out. The Hatch Bill goes to the Senate floor with no analysis as to the economic impact of these amendments. (Again, at least according to Sen. Feinstein, there are 290,000 pending asbestos claims). Insurers and asbestos defendants necessary to support of the Bill may very well pull that support if the "front and back end" amendments remain. On the other hand, given the lengthy delays expected in implementation of the trust fund, if the front and back end amendments are pulled, the Bill may collapse because of a perceived lack of fundamental fairness. For that matter, the Judiciary Committee gave only passing consideration to the details and dynamics of permitting resort to the tort system before trust fund availability. If a plaintiff is one week away from trial before funds become generally available, will he be permitted to go to trial or will his only resort be to the Hatch trust? If the latter, what effective disincentive to frivolous delay tactics can be imposed on asbestos defendants? (Answer: None. Sanctions already exist for frivolous delay tactics, but judges are very reluctant to impose these upon fellow attorneys). In short, S. 1125 is an unworkable mess which cannot be made fair to those with serious asbestos-related injuries without losing the support of asbestos defendants and the insurance industry. My firm and others who represent people with mesothelioma and other asbestos-related cancers must intensify the fight against S. 1125, as we now must deal with 100 Senators, not 19. Chris Stoeckler and Colette Poore showed that two individuals who have suffered from mesothelioma could make a difference. We must now reach out to others across the country to go face-to-face with their Senators and reveal the fatal flaws of S. 1125. If we all work together, and work hard, we will win.
** POSTED JULY 17, 2003 **
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