Frivolous Lawsuits Harm U.S.

Companies, Workers and Consumers – Pass Lawsuit

Abuse Reduction Act
October 25, 2005
Dear Representative:
On behalf of the National Association of Manufacturers (NAM), I urge you to vote in favor of H.R.
420, the Lawsuit Abuse Reduction Act of 2004.
Frivolous lawsuits are often brought for the purpose of trying to coerce a settlement. Meaningful
sanctions need to be imposed against attorneys who bring these suits. In addition, some jurisdictions
have literally opened their courthouse doors to lawsuits that have no relationship to the locale. These
venues typically favor plaintiffs over out-of-state corporations.
In 1993, rules governing frivolous lawsuits were changed to make sanctions for filing such
litigation discretionary. These changes also created a 21-day “safe harbor,” whereby no sanctions
would be imposed if the lawsuit was withdrawn. The Lawsuit Abuse Reduction Act would eliminate the
21-day “safe harbor,” make sanctions mandatory and allow for the reimbursement of defense costs. It
would also discourage “forum shopping” by requiring lawsuits to have a relationship with the jurisdiction
in which they are filed. It would also cover abusive discovery tactics and cases affecting interstate
commerce.
The NAM believes that the reforms contained in H.R. 420 will discourage frivolous lawsuits and
other abusive litigation tactics, and will help make American manufacturers more competitive by
lowering their unnecessary legal expenses.
Votes on H.R. 420, including procedural motions and/or amendments, will be considered for
designation as Key Manufacturing Votes in the NAM voting record for the 109th Congress.

Sincerely,

John Engler
President and CEO

* The NAM is the nation’s largest industrial trade association representing small and large manufacturers in every
industrial sector and in all 50 states. Votes considered for designation as Key Manufacturing Votes are approved in
advance by members on the NAM’s Key Vote Advisory Committee. Eligibility for the NAM Award for Manufacturing
Legislative Excellence is based on a member’s record on Key Manufacturing Votes.