Litigation

The Return of the Lawsuit Abuse Reduction Act

By Carter Wood

The House Judiciary Subcommittee on the Constitution has a hearing scheduled for Friday, March 11, on the yet to be introduced Lawsuit Abuse Reduction Act, legislation that would amend Rule 11 of the Federal Rules of Civil Procedure to discourage frivolous lawsuits.

The Lawsuit Abuse Reduction Act was one of the high-profile pieces of legislation promoted by civil justice reform activists in the previous decade. Rep. Lamar Smith (R-TX), now chairman of the full Judiciary Committee, was sponsor in 2005 of H.R. 420, which passed the House 228-184 (16 House Democrats voted yes along with the Republicans) before stalling in the Senate.

The primary provision of the 2005 bill applied to the federal courts:

(Sec. 2) Amends Rule 11 of the Federal Rules of Civil Procedure (Signing of Pleadings, Motions, and Other Papers; Representations to Court; Sanctions) to: (1) require courts to impose sanctions on attorneys, law firms, or parties who file frivolous lawsuits (currently, discretionary); (2) disallow the withdrawal or correction of pleadings to avoid Rule 11 sanctions; (3) require courts to award parties prevailing on Rule 11 motions reasonable expenses and attorney's fees, if warranted; and (4) authorize courts to impose Rule 11 sanctions that include reimbursement of a party's reasonable litigation costs in connection with frivolous lawsuits.

However, the bill also sought to apply the new Rule 11 standards to state civil actions involving matters that substantially affected interstate commerce, and it had other provisions directed at state courts. That kind of language raises objections from federalism-minded conservatives (e.g. new "Tea Party" aligned House Republicans), who would otherwise support tort reform.

Accordingly, it's our understanding that the upcoming version of the bill will drop the state-specific language to apply only to the federal courts.

Full post as published by Point of Law on March 06, 2011 (boomark / email).