Washington–The House overwhelmingly passed legislation yesterdayimposing sanctions for filing frivolous lawsuits and sent it on tothe Senate, which has already rejected it once.

But, while insurance industry trade associations voiced strongsupport for the bill, David Winston, senior vice president forfederal affairs at the National Association of Mutual InsuranceCompanies, admitted, "It will be much tougher sledding in theSenate, where 60 votes are required for passage."

Mr. Winston said that, "We will continue to push hard for Senateaction on the legislation, but it will take a Herculean effort toget it passed next year."

He explained that for the remainder of this year, the focus ofthe Senate Judiciary Committee will be diverted by the vacancy onthe Supreme Court.

"Clearly, the president's support of the legislation is criticalas it was when the Class Action Reform Act passed earlier thisyear, and hopefully the president will use his bully pulpit to talkabout the importance of this legislation."

The legislation, H.R. 420, the Lawsuit Abuse Reduction Act(LARA), passed the House 228-184. However, a similar bill thatpassed the House last year 229-174 was never brought up for aSenate vote.

The legislation passed by the House yesterday calls forsuspending the licenses of lawyers found to have filed threeso-called "frivolous lawsuits."

Mr. Winston explained that the LARA would end the need for itsmember companies "to use their valuable financial and humanresources to respond to such lawsuits."

Brendan Reilly, director of federal government affairs at theIndependent Insurance Agents and Brokers of America, said it was"common sense to hold plaintiffs' lawyers responsible for filingunwarranted lawsuits," noting that the bill is designed "to preventthe practice of litigation tourism."

Ernie Csiszar, president and CEO of the Property CasualtyInsurers Association of America, said the bill contains "two commonsense proposals"–a ban on so-called "venue shopping" to keeplawsuits in courts with actual connections to the cases and theimposition of sanctions on lawyers who file multiple frivolouscases–that "will benefit all Americans through lower costs."

Charles E. Symington Jr., senior vice president of governmentaffairs and federal relations at the Big I, said the bill, ifpassed, would prevent attorneys from "shopping around forplaintiff-friendly courthouses to bolster their chances ofsuccessfully litigating cases of dubious merits."

The bill reinstates a pre-1993 rule establishing mandatorypenalties against lawyers who file frivolous lawsuits. The penaltywould be the suspension for one year of the law license of a lawyerfound to have filed three baseless lawsuits in any judicial circuitduring their careers.

The House by voice vote added an amendment sponsored by Rep.James Sensenbrenner, R-Wis., chairman of the House JudiciaryCommittee, which allows sanctions to be imposed for the destructionof certain documents in federal court cases.

The amendment also clarifies the anti-forum-shopping provisionby saying that if there is no state court in the county in whichthe injury occurred, the case can be brought in the nearest countywhere a general court is located.

The Judicial Conference of the U.S., which establishes policyfor the federal judiciary, opposes the bill. The conference said itwould return the courts to a system that required penalties forevery violation of the rule and "spawned thousands of courtdecisions and generated widespread criticism."

Under current law, it is up to a judge to determine whether topursue penalties for filing frivolous lawsuits.

The Association of American Trial Lawyers also voiced concernsabout the legislation, arguing that, if enacted, the bill wouldlimit where an injured consumer can file a lawsuit and prevent someforeign corporations who sell unsafe products from being heldaccountable in U.S. courts.

Ken Suggs, president of the Association of Trial Lawyers ofAmerica (ATLA), said the bill would require a suit be brought notwhere there are contacts–but where the defendant's principal placeof business is located, even if that is overseas. In other words,the injured American family would have to travel abroad to file alawsuit.

"It's bad enough that Congress has passed multiple bills thisyear allowing corporations to escape accountability, but to nowprotect foreign corporations that injure Americans with defectiveproducts shows to what extreme lengths they'll go to eliminate theright of ordinary Americans to seek justice," Mr. Suggs said.

Under current law, an injured family can sue a foreignmanufacturer that makes a defective or dangerous product whereverthere are sufficient contacts between that company and thejurisdiction–such as where the product is imported into the U.S. orwhere it is sold, Mr. Suggs said.