‘Frivolous’ Litigation Targeted in Bill Headed to House Floor(1)

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By Bruce Kaufman

Sweeping House legislation intended to reduce “frivolous lawsuits” advanced to the floor Feb. 2, where it is likely to pass.

The Lawsuit Abuse Reduction Act (H.R. 720), sponsored by Rep. Lamar Smith (R-Tex), was approved by the House Judiciary Committee on a 17-6 vote.

The measure requires judges to impose mandatory sanctions on attorneys who file “meritless” civil cases in federal courts.

Federal judges currently have discretion to impose sanctions, but many choose not to do so.

The bill is expected to clear the House with ease, but faces an uncertain fate in the Senate, where 60 votes are needed to overcome a likely filibuster.

President Trump hasn’t yet indicated if he would sign the measure if it were to reach his desk.

Similar legislation, also sponsored by Smith, passed the House in September 2015 by a 241–185 margin, but went nowhere in the upper chamber.

Supporters, Opponents Line Up

The committee action was immediately applauded by the U.S. Chamber Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce.

“These bills will discourage plaintiffs’ lawyers from gaming America’s justice system to their advantage,” ILR’s president, Lisa A. Rickard, said in a statement.

She urged the full House and Senate to pass the legislation swiftly.Many consumer and environmental groups oppose the legislation, including Public Citizen, the Alliance for Justice, Consumers Union and People for the American Way.

Rep. John Conyers (D-Mich) led the charge for opponents, saying the measure would “increase exponentially the volume and cost of litigation in federal courts.”

This bill will also have a “disastrous impact on the administration of justice,” and “chill” the use of novel legal arguments in civil rights cases and other suits, he said.

Companion legislation was introduced Jan. 30 in the Senate by Judiciary Committee Chairman Charles E. Grassley (R-Iowa).

An earlier version of Grassley’s bill died in that committee in 2016.

Had similar legislation made it to President Obama’s desk in the 114th Congress, it would have almost certainly been vetoed.

Committee Takes up Two Additional Bills

The House Judiciary Committee also took up two other measures intended to “reform” federal litigation that are championed by industry groups.

The Innocent Party Protection Act (H.R. 725), sponsored by Rep. Ken Buck (R-Colo.), advanced to the House floor on a 17-4 vote.

The bill targets what is known as fraudulent joinder—the improper addition of defendants to suits in a bid to keep cases in more plaintiff-friendly state courts.

Similar legislation, known as the Fraudulent Joinder Prevention Act (HR 3624), passed the House by a vote of 229-189 in 2016, but died in the Senate Judiciary Committee.

A third measure, the Stop Settlement Slush Funds Act (HR 732), was held over to Feb. 7.

The SSSFA, sponsored by House Judiciary Committee Chairman Robert W. Goodlatte (R-Va.), is intended to reduce the ability of government to steer money to consumer and environmental groups as part of a settlement.

Similar legislation passed in the House by a 241–174 vote in 2016, but died in the Senate Judiciary Committee.

The items are part of the agenda for the 115th Congress set forth by Goodlatte Feb. 1.

To contact the reporter on this story: Bruce Kaufman in Washington at bkaufman@bna.com

To contact the editor responsible for this story: Steven Patrick at spatrick@bna.com

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