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September 11, 2013

Lawmakers Approve Flawed Bill That Would Burden Judiciary, Increase Litigation Costs

Statement of Christine Hines, Consumer and Civil Justice Counsel, Public Citizen

The deceptively named “Lawsuit Abuse Reduction Act” (H.R. 2655) would slow litigation and increase its costs by encouraging additional legal maneuvers and requiring unnecessary court orders. The bill was approved today by the House Judiciary Committee and next goes to the House floor for a full vote.

In practice, this legislation would harm ordinary people with valid and important claims. It is just another backdoor tactic employed by corporate lobbyists and their allies in Congress to make it difficult for consumers and employees to hold corporations accountable.

If passed, this bill would return the litigation process to a time when a former version of a court rule, commonly called “Rule 11,” was used by corporate defendants to prolong and create sideshow litigation. The old version of Rule 11 distracted from the real claims in lawsuits and increased the costs of already-expensive litigation. This bill would re-create a problem that was fixed years ago because it was found to unfairly penalize consumers and burden the judiciary.

Specifically, this bill would make sanctions mandatory if a court finds that a filing in a case is frivolous, effectively removing federal judges’ discretion to decide how to handle allegedly baseless lawsuits. It also removes the “safe harbor” provision from the current rule that gives lawyers the ability to correct or withdraw filings with the court if they might face a Rule 11 challenge. These rules have been proven in the past to harm consumer and civil rights litigation, and would be likely to do so again.

A judicial advisory body that ultimately revised Rule 11 concluded that the old method had wasted resources. The judiciary, as well as consumer, employment and civil rights groups, oppose H.R. 2655 because history shows that it would harm the legal system and impair individuals’ access to justice. The House should learn from the past and reject this abusive measure.

For more about this issue, see a July 22 letter written by Public Citizen and other public interest organizations to U.S. Rep. Bob Goodlatte (R-Va.), chair of the House Judiciary Committee: http://www.citizen.org/documents/lawsuit-abuse-reduction-act-hr2655-opposition-letter.pdf

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