HOUSE OF REPRESENTATIVES COMMONWEALTH OF PENNSYLVANIA ********** House Bill 916 Product Liability Issues ********** HOUSE JUDICIARY COMMITTEE HOUSE LABOR RELATIONS COMMITTEE Room 140, Majority Caucus Room Main Capitol Building Harrisburg, Pennsylvania Thursday, October 26, 1989 - 10;00 a.m. — 0O0 — BEFORE : Honorable Thomas R. Caltagirone, Majority Cha i rma n Honorable Mark B. Cohen, Majority Chairman Honorable Nicholas B. Moehlmann, Minority Cha i rman Honorable Jeffrey E. Piccola, Minority Chairman Honorable David K. Levdansky Honorable Andrew J. Carn Honorable Robert L. Freeman Honorable John F. Pressman Honorable Michael R. Veon Honorable Kenneth E. Brandt Honorable Edgar A. Carlson Honorable J. Scot Chadwick Honorable Joseph M. Gladeck, Jr. Honorable David W. Heckler Honorable Kenneth E. Lee Honorable Ronald S. Marsico Honorable Jere L. Strittmatter , Honorable Christopher McNally to" Honorable Michael E. Bortner filAO ^ K KEY REPORTERS (717) 757-4401 (YORK) <^/ BEFORE (CONT'D) : Honorable Richard Hayden Honorable Joseph Lashinger, Jr. Honorable Lois Sherman Hagarty Honorable Robert D. Reber, Jr. Honorable Karen A. Ritter Honorable Michael C. Gruitza Honorable Paul McHale Honorable Gerald A. Kosinski STAFF MEMBERS: (Labor Relations Committee) Michael Cassidy Majority Executive Director Nevin J. Mindlin Minority Executive Director James M. Trammell, II Minority Research Analyst STAFF MEMBERS: (Judiciary Committee) Katherine Manucci Executive Secretary William H. Andring, Esquire Majority Chief Counsel David Krantz Majority Executive Director Mary Woolley, Esquire Minority Counsel KEY REPORTERS (717) 757-4401 (YORK) C_0_N_T_E_N_T_S WITNESSES PAGE Representative Jeffrey W. Coy 6 Prime sponsor House Bill 916 Senator Rogert Madigan, Chairman 14 Senate Labor & Industry Committee Former Governor George Leader, Co-Chairman 23 Civil Justice Coalition Jim Moran, Director 35 PHILAPOSH Carolyn Hall 48 Concerned citizen Nancy Wisniewski 52 Concerned citizen Vince Gallagher, Safety Specialist 57 ( Letter submitted; authored by 86 Leprerentative Patrick Fldaale ) Ted Walters, President 87 United Injured Workers Eleanor Filoon, President 91 Injured Workers of PA Dr. James H. Henderson 99 Cornell University Law School Donald E. Matusow, Esquire 175 PA Trial Lawyers Association Howard F. Messer, Esquire, Chairman 187 PA Product Liability Section Leonard Sloane, Esquire, President 197 PA Trial Lawyers Association Dr. Peter Linneman, Professor of 229 Public Policy & Finance - Wharton KEY REPORTERS (717) 757-4401 (YORK) C_0_N_T_E_N_T_S WITNESSES PAGE Robert S. Grigsby, Esquire 272 Alder, Cohen & Grisgby Timothy D. Proctor, Esquire 276 Merck Sharp & Dohme Paul R. Roedel, Chairman & CEO 283 Carpenter Technology Corp. Harvey Bradley, President 291 Bradley Lifting Corporation Karen Hicks, President 298 Dalkon Shield Infor. Network Peter J. Hoffman, Esquire, President 308 PA Defense Institute Arthur Glatfelter, Chairman 313 Civil Justice Coalition Donald A. Tortorice, Esquire 318 Peter H. Hickok, President 326 ter. .iHick k,gP esid ntc. KEY REPORTERS (717) 757-4401 (YORK) CHAIRMAN CALTAGIRONE: I'd like to get started. Members and guests, I appreciate it if everybody would refrain from smoking in the room because it is kind of crowded. If you care to indulge in a smoke, please use the hallway outside. I'd like to start off with the introduction of the members. I am Chairman Tom Caltagirone, Chairman of the House Judiciary Committee. Chairman Mark Cohen will be joining us, Chairman of the House Labor Relations Committee. For the benefit of the guests and also our stenographer, if the members and staff that are currently here would please introduce themselves, we will start over to my left at the far table. Please introduce yourself for the record and just come right down the row. We will do the members that are present at this time. REPRESENTATIVE CARLSON: Repre• sentative Edgar Carlson, 68th District. MR. TRAMMELL: Jim Trammell with the staff of the Labor Relations Committee. REPRESENTATIVE BORTNER: I'm KEY REPORTERS (717) 757-4401 (YORK) Representative Mike Bortner, York. MR. MINDLIN: I'm Kevin Mindlin and I'm the Minority Executive Director of Labor Relations Committee. MR. ANDRING: Bill Andring , I'm legal counsel for the Judiciary Committee. REPRESENTATIVE CHADWICK: Represen• tative Scott Chadwick . REPRESENTATIVE HECKLER: Represen• tative Dave Heckler, Bucks County. REPRESENTATIVE McNALLY: Represen• tative Chris McNally, Judiciary Committee from Allegheny County, MR. CASSIDY: Mike Cassidy, Executive Director of Labor Relations Committee. REPRESENTATIVE MOEHLMANN: Represen• tative Nick Moehlmann, Lebanon County, Minority Chairman of the Committee. REPRESENTATIVE HAYDEN: Represen• tative Rick Hayden, Philadelphia County. REPRESENTATIVE MARSICO: Represen• tative Ron Marsico, Dauphin County. CHAIRMAN CALTAGIRONE: Thank you. We will commence immediately with the testimony and we will start off with Representative Jeff Coy, KEY REPORTERS (717) 757-4401 (YORK) who is the prime sponsor of House Bill 916. He will have former Governor Leader, I believe, testifying. REPRESENTATIVE COY: Governor Leader's schedule, I understand, is such that he will be a bit delayed. He will be here later. I'd like to have Senator Madigan join me. Mr. Chairman, members of the Committee, as I'm sure you're aware, recent events have given today's hearing, and the timeliness of it, particular interest. I introduced House Bill 916 and Senator Madigan, who is with me, introduced an identical piece of legislation, Senate Bill 816, several months ago. The Bills have been referred to the appropriate committees in the House and the Senate. Today is really the first opportunity we have had, in a public forum, to introduce the issues and to discuss it with you all. We received the results of a study conducted by two professors at Pennsylvania's Wharton School, which you will hear a little bit later. They found that product liability costs had increased by $5 billion — I say billion with a "b" — in Pennsylvania over the past three KEY REPORTERS (717) 757-4401 (YORK) years, a significant drain on our state's econ omy. This month Forbes magazine ran a cover story headline, "The Litigation Scandal." They said the liability system is out of control. It said that the rest of the economy was being held to ransom. Just six days ago, ABC's 20/20 news program devoted a major segment of the show to the product liability crisis. ABC came to the same conclusion. Our product liability system is crippling the economy. It's driving safe, useful products off the market and it's stifling innovation. The ABC report made many of the same points and cited several of the cases that Senator Madigan and I had planned to discuss this morning. With the Committee's permission, we'd like to relinquish some of our time in order to show the report in its entirety. We'd like to do that now, Mr. Chairman. ( Video presentation occurred ) CHAIRMAN CALTAGIRONE: Before we get started again, there have been several members that have since joined us. Chairman Mark Cohen, KEY REPORTERS (717) 757-4401 (YORK) Chairman of the House Labor Relations Committee, has joined us and other members that have since come in since we opened, stand and identify yourself. REPRESENTATIVE RITTER: Karen Ritter from Allentown. REPRESENTATIVE VEON: Mike Veon, Beave r Falls. REPRESENTATIVE PRESSMAN: Jack Pressman, Allentown. REPRESENTATIVE LEE: Ken Lee, Wyoming County. REPRESENTATVE LEVDANSKY: David Levdansky, Allegheny County. REPRESENTATIVE LASHINGER: Joe Lashinger, Montgomery County. REPRESENTATIVE GLADECK: Joe Gladeck, Montgomery County. REPRESENTATIVE HAGARTY: Lois Hagarty, Montgomery County. REPRESENTATIVE PICCOLA: Jeff Pi ccola. REPRESENTATIVE MORRIS: Sam Morris of Chester County, Chairman of the House Agricultural Committee. KEY REPORTERS (717) 757-4401 (YORK) REPRESENTATIVE COY: Thank you, Mr. Chairman. ABC, as you can see from the videotape, was looking at the product liability crisis from national perspective. I would ask that the committees keep in mind that the crisis is at its peak in Pennsylvania. The Commonwealth Foundation recently reported that more product liability cases were filed in federal courts in Pennsylvania last year than in any other state. The number of million dollar awards has increased in Penn• sylvania by more than 1500 percent since 1983. One of this country's most distinguished legal scholars, Professor James Henderson of Cornell University, will be joining us later this morning to explain why Penn• sylvania has become a breeding ground for public liability lawsuits. He will confirm what I'm telling you now. Pennsylvania's product liability law encourages people to sue. It's confusing, extreme and unfair. It's the worst of its kind in the nation. Bear in mind also that it is entirely case lav;; law that has been created by a lot of different cases and a lot of different KEY REPORTERS (717) 757-4401 (YORK) courtrooms. The General Assembly has never had its say on the issue. We've never put a product liability statute on the books. It's time we did. In April, Senator Madigan and I introduced the Pennsylvania Product Liability Act as additional identical Bills in the State House and State Senate. The House Bill 916 has 61 co-sponsors drawn from both sides of the aisle and it awaits action in your Committee, Mr. Chairman. You each have received a detailed commentary on the Bill. We will be addressing specific provisions later in the hearing. In the few moments left for me, I'd like to share general thoughts on the intent of the legislation and anticipate some of the arguments that may be raised against it. You will hear from people today who have been injured while using a product. When they relate the circumstances of those injuries, ask yourself this question: If House Bill 916 had been law when the injury occurred, would it have prevented the person from going to court and recovering damages? KEY REPORTERS (717) 757-4401 (YORK) Those highly publicized cases that we are all familiar with, cases involving products like the Ford Pinto, the answer to the question is an emphatic no. If a supplier puts a defective product on the market, he will be legally accountable for the injury that the product causes.