ILR Legal Reform Summit - Opening Remarks by Thomas J. Donohue

On: ILR Legal Reform Summit - Opening Remarks
To: Summit attendees
From: Thomas J. Donohue
Date: October 14, 2004

October 14, 2004

Thank you, Lisa, and good morning, everyone.

I'd like to thank all of you for joining us today for our 5th annual Legal Reform Summit.

Much has changed since our first summit. Five years ago, trial lawyers didn't have much to fear from the business community.

Today, the Institute for Legal Reform — working closely with our Litigation Center, the Chamber lobbying and policy team, and many good partners in Washington and across the country – is successfully challenging the trial bar on all fronts.

It is providing the strong leadership that the business community has so desperately needed—and it has the results to prove it.

Lisa briefly mentioned the tremendous success we've had in Mississippi, which would not have been possible without the leadership of Governor Barbour.

Several states are following the "Mississippi Model" and taking steps to restore balance and fairness to their legal systems.

I'd like to focus my brief remarks on some of the things we're doing in Washington on the federal level.

For starters, we're closer than ever to getting class action reform through the Congress.

Despite recent roadblocks in the Senate, we remain committed to passing a class action bill at the earliest possible opportunity.

ILR is also focused on finding a solution to the asbestos problem, and helping to unify the business community on that issue.

We believe that a solution to this crisis is achievable, but time constraints and politics make it difficult to get done this year.

We're defending vigorously against trial lawyer efforts to roll back the Private Securities Litigation Reform Act and other securities litigation reform victories.

And we gained national headlines earlier this year when we asked the SEC to investigate certain short sellers and the Milberg Weiss law firm after a California court ruled that the firm's clients appeared to have participated in a fraud on shareholders.

The court ruling removed these short sellers as lead plaintiffs in a Milberg Weiss class action.

We're also attempting to head off global forum shopping, the practice of trial lawyers bringing cases to U.S. courts because of our lenient laws and compliant juries compared with other parts of the world.

You'll learn more about this form of abuse in one of our afternoon sessions.

Another critical component of our legal reform strategy is to continue and expand the aggressive work of the National Chamber Litigation Center.

Last year the Litigation Center entered a record 72 cases, helping to score a record 31 victories. This year, we've already filed in 50 cases and, with 28 victories so far, are on track to once again rack up a record number of wins.

The Litigation Center has also effectively fought abusive class actions and most importantly, has been a leader in the recent successful efforts to rein in excessive punitive damages awards.

In last year's landmark State Farm case, in which we participated, the U.S. Supreme Court set strict guidelines for punitive damages.

Since then, the Litigation Center has entered a number of other punitive damages cases to ensure the implementation of those guidelines. These cases have already saved the companies involved more than $470 million.

Here's the bottom line: For the first time, the business community is challenging America's litigation explosion in a comprehensive and coordinated way.

For the first time, our adversaries know they have a real fight on their hands.

For the first time, business can point to more than just minor successes around the edges, but also to fundamental changes in the legal landscape across the nation.

So where do we go from here? We must begin by recognizing the compelling truth that our adversaries are as tough as they have ever been.

Maybe even more so because now they have been challenged. They are organized. They are relentless. They have unlimited funds and they retain impressive political clout.

And they have the advantage of surprise – they always have the potential to surprise us by launching new legal attacks on legitimate companies.

That is why it is critical that the ILR, the Litigation Center, and all the other assets the Chamber has put into legal reform continue to grow.

We must continue to expand our involvement in judicial elections and in grassroots legal reform politics. We must continue to tackle the problem states and jurisdictions like Madison County, Illinois, and be relentless in our pursuit of change.

This will include working with the Chamber federation and others to create a pool of pro-reform judicial candidates to run for the bench in the future.

And we must develop web-based approaches and other grassroots strategies to rally support for legal reform legislation and candidates, especially as more traditional avenues such as television advertising become more restricted.

There are hundreds of millions of dollars, indeed billions, to be recovered and saved through a strong post-State Farm program to limit punitive damage awards – so we must expand our work in that arena.

We must ensure that small business in America understand that legal reform is their fight too – it's not just about the big companies. Litigation costs small businesses $88 billion a year.

Don't for a moment think we can rest because we've tasted success. Our work has just begun. Our adversaries have taken sharp notice of our actions. Our economy and society remain heavily penalized by frivolous and abusive litigation.

It would be foolish and dangerous for the business community to unlearn the lessons it learned the hard way in years past – which is that complacency doesn't work, and that individual companies alone cannot successfully challenge the trial lawyers with their tremendous political and financial clout.

Only a united effort by the business community can do that. It must have strong leadership. It must be well financed.

It must have the best lawyers, legal researchers, state and federal lobbyists, grassroots organizers and communications experts working on its behalf.

And it must have the legs and the courage to take on the really tough fights and never back down.

And that is what I believe we have done at the Chamber of Commerce of the United States over the past seven years. It is what we must keep doing, even more aggressively than ever before, into the future.

Today is about identifying key litigation and legal reform trends and mapping a strategy for future success.

We're also here to honor those who have been pivotal in advancing our cause.

It's now my pleasure to introduce our first speaker and also the recipient of the 2004 Legal Reform Award – Senator Tom Carper of Delaware.

Senator Carper has been a strong voice for legal reform in Congress during his five terms in the House and his current term in the Senate, where he has worked tirelessly to forge bipartisan compromises on both the Class Action Fairness Act and an asbestos litigation reform bill.

He brings to the Senate a solid track record on legal reform issues. As a two-term governor of Delaware, Senator Carper helped create a fair and balanced legal environment that has put Delaware at the very top of our Harris Poll rankings of state legal climates for three years running.

During his more than 25 years of public service, Tom Carper has sought to build consensus and work across party lines to find practical solutions to real problems. This is a man for whom party labels and politics do not pose obstacles to results.

And so on behalf of the U.S. business community, it is my pleasure to introduce and present with the 2004 Legal Reform Award, Senator Tom Carper.