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U.S. Response I: Bush Rejected Final Insurance Offer, Senators Say By Pamela Barnett CongressDaily WASHINGTON — The ideological dispute over tort reform that toppled terrorism insurance legislation in 2001 is again threatening to upend the bill, with Senate Democrats late Thursday saying the White House failed to respond to what they described as their “final” and most conciliatory offer. “People have asked, ‘What is the best you can do?’ We’re here to tell you, this is the best we can do,” said Senator Christopher Dodd (D-Conn). “If you take this language, we can have a bill signing ceremony in 24 hours.” “This is our final plea. We’ve gone as far as we can go. The trial lawyers don’t like it, I can tell you that,” Senator Charles Schumer (D-N.Y.) added. President George W. Bush Thursday called for Congress to reach an agreement by today, demanding in appearances that Congress place a bill on his desk on terrorism insurance, homeland security and Defense appropriations. At a hastily convened news conference, a clearly exasperated Dodd and Schumer indicated they decided to go public on the secretive negotiations as a last ditch effort, after waiting since Wednesday to hear back from the White House on their most recent offer. At issue is whether businesses should be shielded from liability associated with acts of terror. The House-passed version of the terrorism bill incorporated tough legal-reform language that effectively prohibits any collection of punitive damages by victims of terrorism and caps attorney’s fees associated with such cases. The Senate bill is silent on business liability, but shields the federal government. The senators said the White House had sent “signals” that it would not accept the Democrats’ latest offer on liability. Sources familiar with the proposal said the White House had sent it back with suggested changes. That rejection apparently proved galling to the Democratic senators, who said they literally lifted GOP-drafted liability language included in last year’s education reform bill, which was approved by both chambers and subsequently signed into law by Bush. The civil justice reform language in the education bill dealt with shielding teachers from lawsuits arising out of efforts to maintain classroom discipline. Specifically, the bill limited the availability of punitive damages against teachers by requiring “clear and convincing evidence of willful or criminal misconduct, or a conscious, flagrant indifference to the rights or safety of the individual harmed.” Dodd and Schumer said they proposed that the exact same standard, which represents an extremely high legal bar, be applied to terror-related lawsuits brought against private business. “It has already been accepted as part of earlier legislation,” Dodd said. “Can you take this legislation, and apply it here?” Touted by such groups as the American Tort Reform Association as the most significant federal legal reform achieved during Bush’s tenure, the so-called teacher protection language is hardly popular with the trial bar, Schumer emphasized. Nevertheless, Dodd said it was his understanding that the deal had been approved by Senate Majority Leader Tom Daschle (D-S.D.), who has been accused by the GOP of coddling the trial bar at the expense of the insurance bill. Schumer said he was “totally befuddled” by the White House’s failure to embrace their compromise. “We’ve gone as far as we can go,” he said, but added, “The signals we’re getting from the White House is that they’re not accepting it.” Schumer said it would be a “tragedy” for the terrorism reinsurance bill to suffer the same fate as bankruptcy reform legislation, and suggested the White House is being held hostage to a handful of “ideologues” and tort reform “extremists” in “both chambers.” Schumer also took a jab at the White House, saying: “Leadership is not holding press conferences and saying you want a bill. Leadership means telling this extreme element, this needs to get done.” Asked whether he thought a deal was still possible this year if today’s deadline was missed, Schumer shrugged. “There’s always life while we’re still in session,” he said. Dodd conceded that other parts of the reinsurance negotiations remain unresolved, including questions about whether to include the House’s “payback” mechanism. However, Dodd said he felt confident those aspects could be quickly settled if the tort reform issue was settled.
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