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By Mr. SPECTER (for himself, Mr. Graham, Mr. Leahy, Mr. Wyden, Mr. Crapo, Mr. Martinez, and Ms. Landrieu):
S. 437. A bill to amend the Internal Revenue Code of 1986 to allow the deduction of attorney-advanced expenses and court costs in contingency fee cases; to the Committee on Finance.
Mr. SPECTER. Mr. President, I seek recognition to introduce legislation to amend Section 162 of the Internal Revenue Code to permit attorneys to deduct expenses and court costs incurred on behalf of contingency fee clients as an ordinary and necessary business expense in the year such expenses are sustained. I introduced the same legislation in the 110th Congress, and the bill attracted bipartisan support. My bill simply clarifies the law to make certain that attorneys who take on contingency fee cases are able to enjoy the same tax benefits as virtually every other small business in the country.
Contingency agreements between attorneys and clients are very common in personal injury, medical malpractice, product liability, Social Security disability, workers compensation, civil liberties, and employment cases. Under these agreements, an attorney pays all out-of-pocket costs associated with a case before any conclusion to the case. Such expenses include costs for expert witnesses, depositions, medical records, and court fees. Contingency agreements have numerous benefits to clients; in particular, indigent individuals who might otherwise be unable to afford legal services.
The obvious benefit to clients of contingency fee arrangements is that they do not have to incur out-of-pocket expenses for attorneys' fees. This may be particularly valuable to clients who do not have the ability to pay attorneys by the hour to advance their case. The arrangement also benefits the client by effectively spreading the risk of litigation. An hourly-rate payment agreement requires the client to assume all of the risk because the attorneys' fees are a sunk cost. However, under a contingent-fee arrangement, the attorney shares that risk and is only paid a fee if he wins the case or obtains a settlement.
Currently, the Internal Revenue Service, IRS, treats expenses and court costs on behalf of contingency clients as loans to the client. As a result, the IRS does not permit any deduction by the attorney until the litigation is resolved, sometimes many years after the attorney has incurred the expenses on behalf of their client. The IRS treats the expenses and court costs as a loan despite the fact that no interest is charged and the lawyer only recoups costs if the case is won or settled. Not only is the IRS's position illogical, but it is contrary to a ruling by the United States Court of Appeals for the 9th Circuit.
In Boccardo v. Commissioner, 56 F.3d 1016, 9t Cir. 1995, the 9th Circuit held that because the firm had a ``gross fee'' contract with the client, the firm incurred ordinary and necessary business expenses in the payment of costs and charges in connection with its clients' litigation. Consequently, litigation costs such as filing fees, witness fees, travel expenses, and medical consultation fees were deductible as ordinary and necessary business expenses in the year the costs were incurred on behalf of the clients. In a ``gross fee'' contract, the client is only obligated to pay their attorney a percentage of the amount recovered and is not expressly responsible for specific repayment of costs. While the Boccardo court contrasted ``gross fee'' contracts with ``net fee'' contracts, such a distinction is trivial for tax purposes. In both agreements, the attorney takes a considerable business risk to incur significant costs on behalf of a client and only recoups the expenses if a recovery is won.
Despite the Boccardo court's ruling in favor of attorneys, the IRS continues to treat the out-of-pocket costs related to contingency fee cases as loans. Lawyers who make the decision to deduct these costs are exposed to potential audit and litigation. Over the past 13 years, taxpayers have had to proceed at their own peril--Ninth Circuit taxpayers risk a conflict with the IRS on this matter despite the case law, and taxpayers outside of the Ninth Circuit have no guidance at all since they cannot directly rely on Boccardo.
My bill reverses an unfair IRS position by treating these businesses the same as all other small businesses. It does so by allowing attorneys with contingency fee clients to deduct their expenses and costs in the year that they are paid. My legislation does not give attorneys anything above and beyond that which is currently enjoyed by virtually every other small business in our country.
Mr. President, I ask unanimous consent that the text of the bill be printed in the RECORD.
There being no objection, the text of the bill was ordered to be printed in the RECORD
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By Mr. SPECTER (for himself and Mr. LEAHY):
S. 440. A bill to amend the Internal Revenue Code of 1986 to allow an above-the-line deduction for attorney fees and costs in connection with civil claim awards; to the Committee on Finance.
Mr. SPECTER. Mr. President, I seek recognition to introduce legislation to amend Section 62(a)(20) of the Internal Revenue Code to allow taxpayers to subtract from their taxable gross income the attorneys' fees and court costs paid by the taxpayer in connection with an award or settlement of monetary damages in a civil claim. Such a deduction is commonly referred to as an ``above-the-line'' deduction.
Under current law, there is an inequity in the tax code that results in the double taxation of attorneys' fees and costs in certain circumstances. In addition, attorneys' fees paid by individuals in recovering a taxable award in certain civil claims are only deductible as miscellaneous itemized deductions. As such, they are subject to a reduction equal to two percent of the individual's adjusted gross income and subject to a complete disallowance when calculating the alternative minimum tax. Consequently, many plaintiffs end up incurring significant tax liability beyond the amount they actually bring home after winning or settling a case.
Congress partially corrected the problem in 2004, when we passed, and President Bush signed, the American Jobs Creation Act of 2004, Jobs Act. The Jobs Act allows an above-the-line deduction for amounts attributable to attorneys' fees and costs received by individuals based on claims brought under certain statutes, including the False Claims Act, 1862(b)(3)(A) of the Social Security Act, or unlawful discrimination claims. Prior to enactment of the Jobs Act, the Internal Revenue Code already excluded from income awards arising out of claims relating to physical injury and sickness. However, attorneys' fees paid in the pursuit and collection of punitive awards, awards for libel, slander, or other awards in cases not involving a physical injury or a claim of discrimination are still not subtracted from gross income.
In 2005, the United States Supreme Court added further confusion to the issue. In Commissioner v. Banks, 543 U.S. 426 (2005), the Court attempted to resolve a circuit split on the Federal income tax treatment of attorneys' fees. In an 8-0 opinion, the Court held that when a litigant's recovery constitutes income, the litigant's income includes the portion of the recovery paid to the attorney as a contingent fee. Consequently, for those claims not excluded from gross income in the Jobs Act, attorneys' fees are subjected to double taxation; subjected to a reduction equal to two percent of the individual's adjusted gross income when listed as a miscellaneous itemized deduction; and subjected to a complete disallowance when calculating the alternative minimum tax.
My legislation corrects the problem by permitting taxpayers to subtract from their taxable gross income the attorneys' fees and court costs paid by the taxpayer in connection with an award or settlement of monetary damages in all civil claims. The legislation would ensure more uniform treatment of contingency fees in all types of litigation, not just the limited categories of litigation as specified in the Jobs Act. Importantly, this change does not affect the requirement that attorneys pay federal income tax on legal fees they receive. The legislation does eliminate the inequity of the client also paying taxes on attorneys' fees despite not receiving the funds under the terms of a contingency fee contract.
I encourage my colleagues to join me in this effort to bring fairness to the tax code.
Mr. President, I ask unanimous consent that the text of the bill be printed in the RECORD.
There being no objection, the text of the bill was ordered to be printed in the RECORD
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By Mr. SPECTER (for himself, Ms. Landrieu, Mr. Carper, Mr. Kerry, Mrs. McCaskill, and Mr. Cochran):
S. 445. A bill to provide appropriate protection to attorney-client privileged communications and attorney work product; to the Committee on the Judiciary.
Mr. SPECTER. Mr. President, I seek recognition today to reintroduce the Attorney-Client Privilege Protection Act of 2009, which is nearly identical to S. 3217, a bill I introduced in July of 2008 under the same name. This legislation continues to address the Department of Justice's corporate prosecution guidelines. Those guidelines, last revised by Deputy Attorney General Mark Filip in August 2008, erode the attorney-client relationship by allowing prosecutors to continue considering the provision of privileged information in order for corporations to receive cooperation credit.
To their credit, the Filip guidelines preclude prosecutors from asking for privilege waivers in nearly all circumstances. However, as evidenced by the numerous versions of the Justice Department's corporate prosecution guidelines over the past decade, the Filip reforms cannot be trusted to remain static. Moreover, unlike Federal law--which requires the assent of both houses and the President's signature or a super-majority in Congress--the Filip guidelines are subject to unilateral executive branch modification. Therefore, to avoid a recurrence of prosecutorial abuses and attorney-client privilege waiver demands, legislation is necessary.
Like my previous bills, this bill will protect the sanctity of the attorney-client relationship by statutorily prohibiting Federal prosecutors and investigators across the executive branch from requesting waiver of attorney-client privilege and attorney work product protections in corporate investigations. The bill would similarly prohibit the government from conditioning charging decisions or any adverse treatment on an organization's payment of employee legal fees, invocation of the attorney-client privilege, or agreement to a joint defense agreement.
The bill makes many subtle improvements over earlier iterations, including defining ``organization'' to make clear that continuing criminal enterprises and terrorist organizations will not benefit from the bill's protections. The bill also clarifies language that the Department of Justice had previously criticized as ambiguous. The bill further makes clear in its findings that its prohibition on informal privilege waiver demands is far from unprecedented. The bill states: ``Congress recognized that law enforcement can effectively investigate without attorney-client privileged information when it banned Attorney General demands for privileged materials in the Racketeer Influenced and Corrupt Organizations Act. See 18 U.S.C. §1968(c)(2).''
Though an improvement over past guidelines, there is no need to wait to see how the Filip guidelines will operate in practice. There is similarly no need to wait for another Department of Justice or executive branch reform that will likely fall short and become the sixth policy in the last 10 years. Any such internal reform may prove fleeting and might not address the privilege waiver policies of other government agencies that refer matters to the Department of Justice, thus allowing in through the window what isn't allowed through the door.
As I said when I introduced my first bill on this subject, the right to counsel is too important to be passed over for prosecutorial convenience or Executive Branch whimsy. It has been engrained in American jurisprudence since the 18th century when the Bill of Rights was adopted. The 6th Amendment is a fundamental right afforded to individuals charged with a crime and guarantees proper representation by counsel throughout a prosecution. However, the right to counsel is largely ineffective unless the confidential communications made by a client to his or her lawyer are protected by law. As the Supreme Court observed in Upjohn Co. v. United States, ``the attorney-client privilege is the oldest of the privileges for confidential communications known to the common law.'' When the Upjohn Court affirmed that attorney-client privilege protections apply to corporate internal legal dialogue, the Court manifested in the law the importance of the attorney-client privilege in encouraging full and frank communication between attorneys and their clients, as well as the broader public interests the privilege serves in fostering the observance of law and the administration of justice. The Upjohn Court also made clear that the value of legal advice and advocacy depends on the lawyer having been fully informed by the client.
In addition to the importance of the right to counsel, it is also fundamental
that the Government has the burden of investigating and proving its own case. Privilege waiver tends to transfer this burden to the organization under investigation. As a former prosecutor, I am well aware of the enormous power and tools a prosecutor has at his or her disposal. The prosecutor has enough power without the coercive tools of the privilege waiver, whether that waiver policy is embodied in the Holder, Thompson, McCallum, McNulty, or Filip memorandum.
As in my prior bills designed to protect the attorney-client privilege, this bill amends title 18 of the United States Code by adding a new section, §3014, that would prohibit any agent or attorney of the U.S. Government in any criminal or civil case to demand or request the disclosure of any communication protected by the attorney-client privilege or attorney work product. The bill would also prohibit government lawyers and agents from basing any charge or adverse treatment on whether an organization pays attorneys' fees for its employees or signs a joint defense agreement.
This legislation is needed to ensure that constitutional protections of the attorney-client relationship are preserved in Federal prosecutions and investigations.
By Mr. SPECTER (for himself, Mr. Grassley, Mr. Durbin, Mr. Schumer, Mr. Feingold, and Mr. Cornyn):
S. 446. A bill to permit the televising of Supreme Court proceedings; to the Committee on the Judiciary.
Mr. SPECTER. Mr. President, once more I seek recognition to introduce legislation that will give the public greater access to our Supreme Court. This bill requires the High Court to permit television coverage of its open sessions unless it decides by a majority vote of the Justices that allowing such coverage in a particular case would violate the due process rights of one or more of the parties involved in the matter.
The purpose of this legislation is to open the Supreme Court doors so that more Americans can see the process by which the Court reaches critical decisions of law that affect this country and everyday Americans. The Supreme Court makes pronouncements on Constitutional and Federal law that have a direct impact on the rights of Americans. Those rights would be substantially enhanced by televising the oral arguments of the Court so that the public can see and hear the issues presented to the Court. With this information, the public would have insight into key issues and be better equipped to understand the impact of and reasons for the Court's decisions.
In a very fundamental sense, televising the Supreme Court has been implicitly recognized--perhaps even sanctioned--in a 1980 decision by the Supreme Court of the United States entitled Richmond Newspapers v. Virginia. In this case, the Court noted that a public trial belongs not only to the accused but to the public and the press as well and recognized that people now acquire information on court procedures chiefly through the print and electronic media.
That decision, in referencing the electronic media, appears to anticipate televising court proceedings, although I do not mean to suggest that the Supreme Court is in agreement with this legislation. I should note that the Court could, on its own initiative, televise its proceedings but has chosen not to do so. This presents, in my view, the necessity for legislating on this subject.
When I argued the case of the Navy Yard, Dalton v. Specter, back in 1994, the Court proceedings were illustrated by an artist's drawings--some of which now hang in my office. Today, the public gets a substantial portion, if not most, of its information from television and the internet. While many court proceedings are broadcast routinely on television, the public has little access to the most important and highest court in this country. Although the internet has made the Court's transcripts, and even more recently, audio recordings, more widely accessible, the public is still deprived of the real time transmission of audio and video feeds from the Court. I believe it is vital for the public to see, as well as to hear, the arguments made before the Court and the interplay among the justices. I think the American people will gain a greater respect for the way in which our High Court functions if they are able to see oral arguments.
Justice Felix Frankfurter perhaps anticipated the day when Supreme Court arguments would be televised when he said that he longed for a day when: ``The news media would cover the Supreme Court as thoroughly as it did the World Series, since the public confidence in the judiciary hinges on the public's perception of it, and that perception necessarily hinges on the media's portrayal of the legal system.''
When I spoke in favor of this legislation in September of 2000, I said, ``I do not expect a rush to judgment on this very complex proposition, but I do believe the day will come when the Supreme Court of the United States will be televised. That day will come, and it will be decisively in the public interest so the public will know the magnitude of what the Court is deciding and its role in our democratic process.'' I have continued to reiterate those sentiments in September of 2005 and in January of 2007 when I re-introduced identical bills. Today, I continue to support this legislation because I believe that it is crucial to the public's awareness of Supreme Court proceedings and their impact on the daily lives of all Americans.
I pause to note that it was not until 1955 that the Supreme Court, under the leadership of Chief Justice Warren, first began permitting audio recordings of oral arguments. Between 1955 and 1993, there were apparently over 5,000 recorded arguments before the Supreme Court. That roughly translates to an average of about 132 arguments annually. But audio recordings are simply ill suited to capture the nuance of oral arguments and the sustained attention of the American citizenry. Nor is it any response that people who wish to see open sessions of the Supreme Court should come to the Capital and attend oral arguments. For, according to one source: ``Several million people each year visit Washington, D.C., and many thousands tour the White House and the Capitol. But few have the chance to sit in the Supreme Court chamber and witness an entire oral argument. Most tourists are given just three minutes before they are shuttled out and a new group shuttled in. In cases that attract headlines, seats for the public are scarce and waiting lines are long. And the Court sits in open session less than two hundred hours each year. Television cameras and radio microphones are still banned from the chamber, and only a few hundred people at most can actually witness oral arguments. Protected by a marble wall from public access, the Supreme Court has long been the least understood of the three branches of our Federal Government.''
In light of the increasing public desire for information, it seems untenable to continue excluding cameras from the courtroom of the Nation's highest court. As one legal commentator observes: ``An effective and legitimate way to satisfy America's curiosity about the Supreme Court's holdings, Justices, and modus operandi is to permit broadcast coverage of oral arguments and decision announcements from the courtroom itself.''
Televised court proceedings better enable the public to understand the role of the Supreme Court and its impact on the key decisions of the day. Not only has the Supreme Court invalidated Congressional decisions where there was, in the views of many, simply a difference of opinion as to what is preferable public policy, but the Court determines novel issues such as whether AIDS is a disability under the Americans with Disabilities Act, whether Congress can ban obscenity from the Internet, and whether states can impose term limits upon members of Congress. The current Court, like its predecessors, hands down decisions which vitally affect the lives and liberties of all Americans. Since the Court's historic 1803 decision, Marbury v. Madison, the Supreme Court has the final authority on issues of enormous importance from birth to death. In Roe v. Wade, 1973, the Court affirmed a Constitutional right to abortion in this country and struck down state statutes banning or severely restricting abortion during the first two trimesters on the grounds that they violated a right to privacy inherent in the Due Process Clause of the Fourteenth Amendment.
In the case of Washington v. Glucksberg, 1997, the court refused to create a similar right to assisted suicide. Here the Court held that the Due Process Clause does not recognize a liberty interest that includes a right to commit suicide with another's assistance.
In the Seventies, the Court first struck down then upheld state statutes imposing the death penalty for certain crimes. In Furman v. Georgia, 1972, the Court struck down Georgia's death penalty statute under the cruel and unusual punishment clause of the Eighth Amendment and stated that no death penalty law could pass constitutional muster unless it took aggravating and mitigating circumstances into account. This decision led Georgia and many States to amend their death penalty statutes and, four years later, in Gregg v. Georgia, 1976, the Supreme Court upheld Georgia's amended death penalty statute.
Over the years, the Court has also played a major role in issues of war and peace. In its opinion in Scott v. Sandford, 1857--better known as the Dred Scott decision--the Supreme Court held that Dred Scott, a slave who had been taken into ``free'' territory by his owner, was nevertheless still a slave.
The Court further held that Congress lacked the power to abolish slavery in certain territories, thereby invalidating the careful balance that had been worked out between the North and the South on the issue. Historians have noted that this opinion fanned the flames that led to the Civil War.
The Supreme Court has also ensured adherence to the Constitution during more recent conflicts. Prominent opponents of the Vietnam War repeatedly petitioned the Court to declare the Presidential action unconstitutional on the grounds that Congress had never given the President a declaration of war. The Court decided to leave this conflict in the political arena and repeatedly refused to grant writs of certiorari to hear these cases. This prompted Justice Douglas, sometimes accompanied by Justices Stewart and Harlan, to take the unusual step of writing lengthy dissents to the denials of cert.
In New York Times Co. v. United States, 1971--the so called ``Pentagon Papers'' case--the Court refused to grant the government prior restraint to prevent the New York Times from publishing leaked Defense Department documents which revealed damaging information about the Johnson Administration and the war effort. The publication of these documents by the New York Times is believed to have helped move public opinion against the war.
In its landmark civil rights opinions, the Supreme Court took the lead in effecting needed social change, helping us to address fundamental questions about our society in the courts rather than in the streets. In Brown v. Board of Education, the Court struck down the principle of ``separate but equal'' education for blacks and whites and integrated public education in this country. This case was then followed by a series of civil rights cases which enforced the concept of integration and full equality for all citizens of this country, including Gamer v. Louisiana, 1961, Burton v. Wilmington Parking Authority, 1961, and Peterson v. City of Greenville, 1963.
In recent years Marbury, Dred Scott, Furman, New York Times, and Roe, familiar names in the lexicon of lawyerly discussions concerning watershed Supreme Court precedents, have been joined with similarly important cases like Hamdi, Rasul, Roper, and Boumediene--all cases that affect fundamental individual rights. In Hamdi v. Rumsfeld, 2004, the Court concluded that although Congress authorized the detention of combatants, due process demands that a citizen held in the United States as an enemy combatant be given a meaningful opportunity to contest the factual basis for that detention before a neutral decisionmaker. The Court reaffirmed the nation's commitment to constitutional principles even during times of war and uncertainty. Similarly, in Rasul v. Bush, 2004, the Court held that the Federal habeas statute gave district courts jurisdiction to hear challenges of aliens held at Guantanamo Bay, Cuba in the U.S. War on Terrorism. In Roper v. Simmons, a 2005 case, the Court held that executions of individuals who were under 18 years of age at the time of their capital crimes is prohibited by Eighth and Fourteenth Amendments. In Boumediene v. Bush, 2008, the Court held that, subsequent to Hamdan v. Rumsfeld and regardless of Congress' attempts to strip federal courts of jurisdiction to consider pending habeas corpus petitions from Guantanamo detainees, the detainees nonetheless were not barred from seeking the writ and procedures under the Detainee Treatment Act were not an adequate substitute for it.
When deciding issues of such great national import, the Supreme Court is rarely unanimous. In fact, a large number of seminal Supreme Court decisions, such as Boumediene, have been reached through a vote of 5-4. Such a close margin reveals that these decisions are far from foregone conclusions distilled from the meaning of the Constitution, reason and the application of legal precedents. On the contrary, these major Supreme Court opinions embody critical decisions reached on the basis of the preferences and views of each individual justice. In a case that is decided by a vote of 5-4, an individual justice has the power by his or her vote to change the law of the land.
Since the beginning of its October 2005 term when Chief Justice Roberts first began hearing cases, the Supreme Court has issued 45 decisions with a 5-4 split, not including the current October 2008 term, in which I understand there are additional 5-4 decisions within the few cases that have already been decided. It has also issued six 5-3 decisions in which one justice recused. Finally, it has issued a rare 5-2 decision in which Chief Justice Roberts and Justice Alito took no part, and in the October 2007 term, two 4-4 ties. In sum, since the beginning of its October 2005 term and not counting the current term, the Supreme Court has issued 52 decisions establishing the law of the land in which only 5 justices explicitly concurred. Many of these narrow majorities occur in decisions involving the Court's interpretation of our Constitution--a sometimes divisive endeavor on the Court. I will not discuss all 52 thinly decided cases but will describe a few to illustrate my point about the importance of the Court and its decisions in the lives of Americans.
The first 5-4 split decision, decided on January 11, 2006, was Brown v. Sanders. In this case the Court considered ``the circumstances in which an invalidated sentencing factor will render a death sentence unconstitutional by reason of its adding an improper element to the aggravation scale in the jury's weighing process.'' A majority of the Court held that henceforth in death penalty cases, an invalidated sentencing factor will render the sentence unconstitutional by reason of its adding an improper element to the aggravation scale unless one of the other sentencing factors enables the sentencer to give aggravating weight to the same facts and circumstances. The majority opinion was authored by Justice Scalia and joined by Chief Justice Roberts and Justices O'Connor, Kennedy and Thomas. Justice Stevens filed a dissenting opinion in which Justice Souter joined. Similarly, Justice Breyer filed a dissenting opinion in which Justice Ginsburg joined.
In November 2006, the Supreme Court decided Ayers v. Belmontes, a capital murder case in which the Belmontes contended that California law and the trial court's instructions precluded the jury from considering his forward looking mitigation evidence suggesting he could lead a constructive life while incarcerated. In Ayers the Supreme Court found the Ninth Circuit erred in holding that the jury was precluded by jury instructions from considering mitigation evidence. Justice Kennedy authored the majority opinion while Justice Stevens wrote a dissent joined by three other justices.
Other 5-4 split decisions since October 2005 include United States v. Gonzalez-Lopez, concerning whether a defendant's Sixth Amendment right to counsel was violated when a district court refused to grant his paid lawyer permission to represent him based upon some past ethical violation by the lawyer, June 26, 2006; LULAC v. Perry, deciding whether the 2004 Texas redistricting violated provisions of the Voting Rights Act, June 28, 2006; Kansas v. Marsh, concerning the Eighth and Fourteenth Amendments in a capital murder case in which the defense argued that a Kansas statute established an unconstitutional presumption in favor of the death sentence when aggravating and mitigating factors were in equipoise, April 25, 2006; Clark v. Arizona, a capital murder case involving the constitutionality of an Arizona Supreme Court precedent governing the admissibility of evidence to support an insanity defense, June 29, 2006; Garcetti v. Ceballos, a case holding that when public employees make statements pursuant to their official duties they are not speaking as citizens for First Amendment purposes, and the Constitution does not insulate their communications from employer discipline, May 30, 2006; and District of Columbia v. Heller, June 26, 2008, which found that Washington, D.C.'s gun laws were unconstitutionally restrictive of rights afforded under the Second Amendment.
The justices have split 5-3 six times since October 2005.
In Georgia v. Randolph, March 22, 2006, a 5-3 majority of the Supreme Court held that a physically present co-occupant's stated refusal to permit a warrantless entry and search rendered the search unreasonable and invalid as to that occupant. Justice Souter authored the majority opinion. Justice Stevens filed a concurring opinion as did Justice Breyer. The Chief Justice authored a dissent joined by Justice Scalia. Moreover, Justice Scalia issued his own dissent as did Justice Thomas. In Randolph, there were six opinions in all from a Court that only has nine justices. One can only imagine the spirited debate and interplay of ideas, facial expressions and gestures that occurred in oral arguments. Audio recordings are simply inadequate to capture all of the nuance that only cameras could capture and convey.
In House v. Bell, a 5-3 opinion authored by Justice Kennedy, June 12, 2006, the Supreme Court held that because House had made the stringent showing required by the actual innocence exception to judicially-established procedural default rules, he could challenge his conviction even after exhausting his regular appeals. Justice Alito took no part in considering or deciding the House case. It bears noting, however, that if one justice had been on the other side of this decision it would have resulted in a 4-4 tie and, ultimately, led to affirming the lower court's denial of House's post-conviction habeas petitions due to a procedural default.
In Hamdan v. Rumsfeld, a 5-3 decision in which Chief Justice Roberts took no part, the Supreme Court held that Hamdan could challenge his detention and the jurisdiction of the President's military commissions to try him despite recent enactment of the Detainee Treatment Act. A thin majority of the justices supported the decision despite knowledge that the DTA explicitly provides ``no court ..... shall have jurisdiction to hear or consider ..... an application for ..... habeas corpus filed by ..... an alien detained ..... at Guantanamo Bay.'' In deciding the merits, the Court went on to hold that the President lacked authority to establish a military commission to try Hamdan or others without enabling legislation passed by both houses of Congress and enacted into law. This case was one of a handful of recent cases in which the Supreme Court released audiotapes of oral arguments almost immediately after they occurred. Yet it would have been vastly preferable to watch the parties' advocates grapple with the legal issues as the justices peppered them with jurisdictional, constitutional and merits-related questions from the High Court's bench.
In another fascinating 5-3 case, Jones v. Flowers, April 26, 2006, the Supreme Court considered whether, when notice of a tax sale is mailed to the owner and returned undelivered, the government must take additional reasonable steps to provide notice before taking the owner's property. In an opinion by Chief Justice Roberts, the Court held that where the Arkansas Commissioner of State Lands had mailed Jones a certified letter and it had been returned unclaimed, the Commissioner had to take additional reasonable steps to provide Jones notice. Justices Thomas, Scalia and Kennedy dissented and Justice Alito took no part in the decision.
Though Jones v. Flowers involved the Due Process Clause of the Fourteenth Amendment, not the Takings Clause of Fifth Amendment, one could draw interesting analogies to the Court's controversial 2005 decision in Kelo v. City of New London. In Kelo, a majority of the justices held that a city's exercise of eminent domain power in furtherance of a privately initiated economic development plan satisfied the Constitution's Fifth Amendment ``public use'' requirement despite the absence of any blight. Four justices dissented in Kelo and public opinion turned sharply against the decision immediately after it was issued.
It's possible, though merely speculative, that the public ire aimed at Kelo informed what became a majority of justices in Jones v. Flowers. In a passage by Chief Justice Roberts, the Court notes, ``when a letter is returned by the post office, the sender will ordinarily attempt to resend it, if it is practicable to do so. This is especially true when, as here, the subject matter of the letter concerns such an important and irreversible prospect as the loss of a house.''
Not only lawyers but all homeowners could benefit from knowing how the Court grapples with legal issues governing the rights to their houses. My legislation creates the opportunity for all interested Americans to watch the Court in action in cases like these. From his perch on the High Court one justice has been heard to contend that most Americans could care less about the arcane legal issues argued before the Court. But as elected representatives of the people we must endeavor to view America from a bottoms-up, rather than a top-down perspective.
Regardless of one's view concerning the merits of these decisions, it is clear that they frequently have a profound effect on the interplay between the government, on the one hand, and the individual on the other. So, it is with these watershed decisions in mind that I introduce legislation designed to make the Supreme Court less esoteric and more accessible to common men and women who are so clearly affected by its decisions.
Given the enormous significance of each vote cast by each justice on the Supreme Court, televising the proceedings of the Supreme Court will allow sunlight to shine brightly on these proceedings and ensure greater public awareness and scrutiny.
In a democracy, the workings of the government at all levels should be open to public view. With respect to oral arguments, the more openness and the more real the opportunity for public observation the greater the understanding and trust. As the Supreme Court observed in the 1986 case of Press-Enterprise Co. v. Superior Court, ``People in an open society do not demand infallibility from their institutions, but it is difficult for them to accept what they are prohibited from observing.''
It was in this spirit that the House of Representatives opened its deliberations to meaningful public observation by allowing C-SPAN to begin televising debates in the House chamber in 1979. The Senate followed the House's lead in 1986 by voting to allow television coverage of the Senate floor.
Beyond this general policy preference for openness, however, there is a strong argument that the Constitution requires that television cameras be permitted in the Supreme Court.
It is well established that the Constitution guarantees access to judicial proceedings to the press and the public. In 1980, the Supreme Court relied on this tradition when it held in Richmond Newspapers v. Virginia that the right of a public trial belongs not just to the accused, but to the public and the press as well. The Court noted that such openness has ``long been recognized as an indisputable attribute of an Anglo-American trial.''
Recognizing that in modern society most people cannot physically attend trials, the Court specifically addressed the need for access by members of the media: ``Instead of acquiring information about trials by first hand observation or by word of mouth from those who attended, people now acquire it chiefly through the print and electronic media. In a sense, this validates the media claim of acting as surrogates for the public. [Media presence} contributes to public understanding of the rule of law and to comprehension of the functioning of the entire criminal justice system.''
To be sure, a strong argument can be made that forbidding television cameras in the court, while permitting access to print and other media, constitutes an impermissible discrimination against one type of media over another. In recent years, the Supreme Court and lower courts have repeatedly held that differential treatment of different media is impermissible under the First Amendment absent an overriding governmental interest. For example, in 1983 the Court invalidated discriminatory tax schemes imposed only upon certain types of media in Minneapolis Star & Tribune Co. v. Minnesota Commissioner of Revenue. In the 1977 case of ABC v. Cuomo, the Second Circuit rejected the contention by the two candidates for mayor of New York that they could exclude some members of the media from their campaign headquarters by providing access through invitation only. The Court wrote that: ``Once there is a public function, public comment, and participation by some of the media, the First Amendment requires equal access to all of the media or the rights of the First Amendment would no longer be tenable.''
However, in the 1965 case of Estes v. Texas, the Supreme Court rejected the argument that the denial of television coverage of trials violates the equal protection clause. In the same opinion, the Court held that the presence of television cameras in the Court had violated a Texas defendant's right to due process. Subsequent opinions have cast serious doubt upon the continuing relevance of both prongs of the Estes opinion.
In its 1981 opinion in Chandler v. Florida, the court recognized that Estes must be read narrowly in light of the state of television technology at that time. The television coverage of Estes' 1962 trial required cumbersome equipment, numerous additional microphones, yards of new cables, distracting lighting, and numerous technicians present in the courtroom. In contrast, the court noted, television coverage in 1980 can be achieved through the presence of one or two discreetly placed cameras without making any perceptible change in the atmosphere of the courtroom. Accordingly, the Court held that, despite Estes, the presence of television cameras in a Florida trial was not a violation of the rights of the defendants in that case. By the same logic, the holding in Estes that exclusion of television cameras from the courts did not violate the equal protection clause must be revisited in light of the dramatically different nature of television coverage today.
Given the strength of these arguments, it is not surprising that over the last two decades there has been a rapidly growing acceptance of cameras in American courtrooms which has reached almost every court except for the Supreme Court itself.
On September 6, 2000, the Senate Judiciary Committee's Subcommittee on Administrative Oversight and the Courts held a hearing titled ``Allowing Cameras and Electronic Media in the Courtroom.'' The primary focus of the hearing was Senate bill S. 721, legislation introduced by Senators Grassley and Schumer that would give Federal judges the discretion to allow television coverage of court proceedings. One of the witnesses at the hearing, the late Judge Edward R. Becker, then-Chief Judge U.S. Court of Appeals for the Third Circuit, spoke in opposition to the legislation and the presence of television cameras in the courtroom. The remaining five witnesses, however, including a Federal judge, a State judge, a law professor and other legal experts, all testified in favor of the legislation. They argued that cameras in the courts would not disrupt proceedings but would provide the kind of accountability and access that is fundamental to our system of government.
On November 9, 2005, the Judiciary Committee held a hearing to address whether Federal court proceedings should be televised generally and to consider S. 1768, my earlier version of this bill, and S. 829, Senator Grassley's ``Sunshine in the Courtroom Act of 2005.'' During the November 9 hearing, most witnesses spoke favorably of cameras in the courts, particularly at the appellate level. Among the witnesses favorably disposed toward the cameras were Peter Irons, author of May It Please the Court, Seth Berlin, a First Amendment expert at a local firm, Brian Lamb, founder of C-SPAN, Henry Schleif of Court TV Networks, and Barbara Cochran of the Radio-Television News Directors Association and Foundation.
The notable exception was the Honorable Judge Jan DuBois of the Eastern District of Pennsylvania, who testified on behalf of the Judicial Conference. Judge DuBois warned of problems particularly at the trial level, where witnesses who appear uncomfortable because of cameras might seem less credible to jurors. I note, however, that appellate courts do not appear susceptible to this criticism because there are no witnesses or jurors present for appellate arguments.
The Judiciary Committee considered and passed both bills on March 30, 2006. The Committee vote to report S. 1768 was 12-6, and the bill was placed on the Senate Legislative Calendar. Unfortunately, due to the press of other business neither bill was allotted time on the Senate Floor. Again, in the 110th Congress, I introduced this legislation, and it was reported out of the Judiciary Committee by a vote of 11-7.
During their confirmation hearings over the past two years, Chief Justice John Roberts stated he would keep an open mind on the issue and Justice Alito stated that as a circuit judge he unsuccessfully voted, in the minority, to permit televised open proceedings in the Third Circuit. I applaud the fact the new Chief Justice has taken steps to make the Court more open and to ensure the timely publication of audio recordings of the arguments as well as the written transcripts.
In my judgment, Congress, with the concurrence of the President, or overriding his veto, has the authority to require the Supreme Court to televise its proceedings. Such a conclusion is not free from doubt and is highly likely to be tested with the Supreme Court, as usual, having the final word. As I see it, there is clearly no constitutional prohibition against such legislation.
Article 3 of the Constitution states that the judicial power of the United States shall be vested ``in one Supreme Court and such inferior Courts as the Congress may from time to time ordain and establish.'' While the Constitution specifically creates the Supreme Court, it left it to Congress to determine how the Court would operate. For example, it was Congress that fixed the number of justices on the Supreme Court at nine. Likewise, it was Congress that decided that any six of these justices are sufficient to constitute a quorum of the Court. It was Congress that decided that the term of the Court shall commence on the first Monday in October of each year, and it was Congress that determined the procedures to be followed whenever the Chief Justice is unable to perform the duties of his office.
Beyond such basic structural and operational matters, Congress also controls more substantive aspects of the Supreme Court. Most importantly, it is Congress that in effect determines the appellate jurisdiction of the Supreme Court. Although the Constitution itself sets out the original jurisdiction of the Court, it provides that appellate jurisdiction exists ``with such exceptions and under such regulations as the Congress shall make.''
Some objections have been raised to televised proceedings of the Supreme Court on the ground that it would subject justices to undue security risks. My own view is such concerns are vastly overstated. Well-known members of Congress walk on a regular basis in public view in the Capitol complex. Other very well-known personalities, presidents, vice presidents, cabinet officers, all are on public view with even incumbent presidents exposed to risks as they mingle with the public. Such risks are minimal in my view given the relatively minor ensure that Supreme Court justices would undertake through television appearances. Also, any concerns could be mitigated by focusing only on the attorneys presenting arguments. There is no requirement that the justices permit the cameras to focus on the bench.
As I explained earlier, the Supreme Court could, of course, permit television through its own rule but has decided not to do so. Congress should be circumspect and even hesitant to impose a rule mandating the televising of Supreme Court proceedings and should do so only in the face of compelling public policy reasons. The Supreme Court has such a dominant role in key
decision-making functions that their proceedings ought to be better known to the public; and, in the absence of Court rule, public policy would be best served by enactment of legislation requiring the televising of Supreme Court proceedings.
This legislation embodies sound policy and will prove valuable to the all Americans. I urge my colleagues to support this bill.
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By Mr. SPECTER (for himself, Mr. SCHUMER, Mr. LUGAR, and Mr. GRAHAM):
S. 448. A bill to maintain the free flow of information to the public by providing conditions for the federally compelled disclosure of information by certain persons connected with the news media; to the Committee on the Judiciary.
Mr. SPECTER. Mr. President, I sought recognition to introduce the Free Flow of Information Act of 2009. I am honored to be joined in my efforts by Senators SCHUMER, LUGAR and GRAHAM, who are original cosponsors. Some 242 years ago, on January 16, 1767, Thomas Jefferson remarked in a letter to Col. Edward Carrington, ``Were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter.'' We take our free press for granted because it is so ingrained in our history. But we need only look at free press movements in fledgling democracies to appreciate how sometimes fragile and easily chilled freedom of press truly is.
The Free Flow of Information Act protects the public interest by ensuring an informed citizenry. In the past three years the Department of Justice has provided inconsistent numbers of subpoenaed journalists to the Judiciary Committee. We know from the public record, however, that at least 19 journalists have been subpoenaed by federal and special prosecutors for confidential source information since 2001 claim. Among them are Judith Miller, Matt Cooper, Tim Russert, Lance Williams, Mark Fainaru-Wada, and Philip Shenon. We also know 4 journalists have been imprisoned at the request either of the DoJ, U.S. Attorneys, or special prosecutors since 2000. Josh Wolf, Judith Miller, Jim Taricani, Vanessa Leggett. Collectively, these journalists have spent over 19 months imprisoned. Journalists who are not jailed for failing to comply with subpoenas still suffer the prospect of being held in contempt. Several have suffered this fate: Toni Locy, James Stewart, Walter Pincus, Jim Taricani.
In addition to the subpoenas from special prosecutors mentioned above, more than a dozen reporters have received subpoenas in civil suits, such as the Wen Ho Lee and Hatfill privacy lawsuits against the government. A preliminary report on the 2007 Media Subpoena Survey conducted by Professor RonNell Andersen Jones at the Law College Foundation at the University of Arizona states: 761 responding news organizations reported receiving a total of 3,602 subpoenas seeking information or material relating to newsgathering activities in calendar year 2006. Of these, 335 were subpoenas arising out of proceedings that took place in a federal forum. Sixty-four percent of responding newsroom leaders believe the frequency of media subpoenas to be greater than it was five years ago. Fifty percent of the media companies believe the risk of their own organization receiving a subpoena is greater than it was five years ago, while only 5 percent believe the risk to be less.
This bipartisan legislation would establish a qualified reporters' privilege protecting them from being compelled to identify confidential source information. The bill seeks to reconcile reporters' need to maintain confidentiality, in order to ensure that sources will speak openly and freely with the media, with the public's right to effective law enforcement and fair trials. The situation in the United States today is that journalists are subject to a compulsory process to disclose confidential informants--at least in Federal courts. At the State level, there are many laws providing qualified privileges for journalists. Prior versions of this bill garnered the support of numerous bipartisan cosponsors, as well as 39 media organizations, including the Washington Post, The Hearst Corporation, Time Warner, ABC Inc., CBS, CNN, The New York Times Company, and National Public Radio.
In 2005 I cosponsored two prior bills and was principle author of yet another. In the 110th Congress, I introduced S. 1035 the Free Flow of Information Act of 2007, along with Senator SCHUMER, and Senators LUGAR, GRAHAM, and DODD other senators to join as cosponsors were Senators LEAHY, JOHNSON, BOXER, KLOBUCHAR, Salazar, Obama, Clinton, Dole, MURRAY, LANDRIEU, WEBB, TESTER, LIEBERMAN, DURBIN, BAUCUS, and LAUTENBERG. On October 4, 2007, the Committee on the Judiciary favorably reported S.2035 out of committee by a 15-4 vote, which marked the first time a reporters' privilege bill had ever passed out of the Senate Judiciary Committee.
On March 6, 2008, I, along with Senator LEAHY, sent a letter to Majority Leader REID and Minority Leader MCCONNELL asking that S. 2035 receive floor time for full Senate consideration. They answered our call. On July 30, 2008, the Senate entertained a cloture vote on the motion to proceed to the measure that failed by a vote of 51-43. Nonetheless, the bill continues to enjoy broad bipartisan support--including the pledged support of former Senator, now--President Barack Obama. I urge all of my colleagues to join me in passing the Free Flow of Information Act of 2009, its high time we stop jailing or holding in contempt reporters who, in good faith, protect their confidential sources even in the face of a government subpoena.
There has been a growing consensus that we need to establish a Federal journalists' privilege to protect the integrity of the news gathering process, a process that depends on the free flow of information between journalists and whistleblowers, as well as other confidential sources.
Under my chairmanship, the Judiciary Committee held three separate hearings on this issue at which we heard from 20 witnesses, including prominent journalists like William Safire and Judith Miller, current and former Federal prosecutors, including former Deputy Attorney General Paul McNulty, and First Amendment scholars.
These witnesses demonstrated that there are two vital, competing concerns at stake. On one hand, reporters cite the need to maintain confidentiality in order to ensure that sources will speak openly and freely with the news media. The renowned William Safire, former columnist for the New York Times, testified that ``the essence of news gathering is this: if you don't have sources you trust and who trust you, then you don't have a solid story--and the public suffers for it.'' Reporter Matthew Cooper of Time Magazine said this to the Judiciary Committee: ``As someone who relies on confidential sources all the time, I simply could not do my job reporting stories big and small without being able to speak with officials under varying degrees of anonymity.''
On the other hand, the public has a right to effective law enforcement and fair trials. Our judicial system needs access to information in order to prosecute crime and to guarantee fair administration of the law for plaintiffs and defendants alike. As a Justice Department representative told the Committee, prosecutors need to ``maintain the ability, in certain vitally important circumstances, to obtain information identifying a source when a paramount interest is at stake. For example, obtaining source information may be the only available means of preventing a murder, locating a kidnapped child, or identifying a serial arsonist.''
As Federal courts have considered these competing interests, they adopted rules that went in several different directions. Rather than a clear, uniform standard for deciding claims of journalist privilege, the Federal courts currently observe a ``crazy quilt'' of different judicial standards.
The confusion began 36 years ago, when the Supreme Court decided Branzburg v. Hayes. The Court held that the press' First Amendment right to publish information does not include a right to keep information secret from a grand jury investigating a criminal matter. The Supreme Court also held that the common law did not exempt reporters from the duty of every citizen to provide information to a grand jury.
The Court reasoned that just as newspapers and journalists are subject to the same laws and restrictions as other citizens, they are also subject to the same duty to provide information to a court as other citizens. However, Justice Powell, who joined the 5-4 majority, wrote a separate concurrence in which he explained that the Court's holding was not an invitation for the Government to harass journalists. If a journalist could show that the grand jury investigation was being conducted in bad faith, the journalist could ask the court to quash the subpoena. Justice Powell indicated that courts might assess such claims on a case-by-case basis by balancing the freedom of the press against the obligation to give testimony relevant to criminal conduct.
In attempting to apply Justice Powell's concurring opinion, Federal courts have split on the question of when a journalist is required to testify. In more than three decades since Branzburg, the Federal courts are split in at least three ways in their approaches to Federal criminal and civil cases.
With respect to Federal criminal cases, five circuits apply Branzburg so as to not allow journalists to withhold information absent governmental bad faith. Four other circuits recognize a qualified privilege, which requires courts to balance the freedom of the press against the obligation to provide testimony on a case-by-case basis. The law in the District of Columbia Circuit is unsettled.
With respect to Federal civil cases, 9 of the 12 circuits apply a balancing test when deciding whether journalists must disclose confidential sources. One circuit affords journalists no privilege in any context. Two other circuits have yet to decide whether journalists have any privilege in civil cases. Meanwhile, 49 States plus the District of Columbia have recognized some form of reporters' privilege within their own jurisdictions. Thirty-one States plus the District of Columbia have passed some form of reporter's shield statute, and 18 States have recognized a privilege at common law.
There is little wonder that there is a growing consensus concerning the need for a uniform journalists' privilege in Federal courts. This system must be simplified.
Today, we move toward resolving this problem by introducing the Free Flow of Information Act of 2009. The purpose of this bill is to guarantee the flow of information to the public through a free and active press, while protecting the public's right to effective law enforcement and individuals' rights to the fair administration of justice.
The bill provides a qualified privilege for reporters to withhold from Federal courts, prosecutors, and other Federal entities, confidential source information and documents and materials obtained or created under a promise of confidentiality. However, the bill recognizes that, in certain instances, the public's interest in law enforcement and fair trials outweighs a source's interest in remaining anonymous through the reporter's assertion of a privilege. Therefore, it allows courts to require disclosure where certain criteria are met.
Under the legislation, in most criminal investigations and prosecutions, the Federal entity seeking the reporter's source information must show that there are reasonable grounds to believe that a crime has occurred, and that the reporter's information is essential to the prosecution or defense. In criminal investigations and prosecutions of leaks of classified information, the Federal entity seeking disclosure must additionally show that the leak caused significant, clear, and articulable harm to national security. In noncriminal actions, the Federal entity seeking source information must show that the reporter's information is essential to the resolution of the matter.
In all cases and investigations, the Federal entity must demonstrate that nondisclosure would be contrary to the public interest. In other words, the court must balance the governmental need for the information against the public interest in newsgathering and the free flow of information.
Further, the bill ensures that Federal Government entities do not engage in ``fishing expeditions'' for a reporter's information. The information a reporter reveals must, to the extent possible, be limited to verifying published information and describing the surrounding circumstances. The information must also be narrowly tailored to avoid compelling a reporter to reveal peripheral or speculative information.
Finally, the Free Flow of Information Act adds layers of safeguards for the public. Reporters are not allowed to withhold information if a Federal court concludes that the information is needed for the defense of our Nation's security, as long as it outweighs the public interest in newsgathering and maintains the free flow of information to citizens, or to prevent an act of terrorism. Similarly, journalists may not withhold information reasonably necessary to stop a kidnapping or a crime that could lead to death or physical injury. Also, the bill ensures that both crime victims and criminal defendants will have a fair hearing in court. Under this bill, a journalist who is an eyewitness to a crime or tort or takes part in a crime or tort may not withhold that information on grounds of the qualified privilege. Journalists should not be permitted to hide from the law by writing a story and then claiming a reporter's privilege.
It is time for Congress to clear up the ambiguities journalists and the Federal judicial system face in balancing the protections journalists need in providing confidential information to the public with the ability of the courts to conduct fair and accurate trials. I urge my colleagues to support this legislation and help create a fair and efficient means to serve journalists and the news media, prosecutors and the courts, and most importantly the public interest on both ends of the spectrum.
By Mr. SPECTER (for himself, Mr. Lieberman, and Mr. Schumer):
S. 449. A bill to protect free speech; to the Committee on the Judiciary.
Mr. SPECTER. Mr. President. I am introducing the Free Speech Protection Act of 2009 to address a serious challenge to one of the most basic protections in our Constitution. American journalists and academics must have the freedom to investigate, write, speak, and publish about matters of public importance, limited only by the legal standards laid out in our First Amendment jurisprudence, including precedents such as New York Times v. Sullivan. Despite the protection for free speech under our own law, the rights of the American public, and of American journalists who share information with the public, are being threatened by the forum shopping of libel suits to foreign courts with less robust protections for free speech.
These suits are filed in, and entertained by, foreign courts, despite the fact that the challenged speech or writing is written in the United States by U.S. journalists, and is published or disseminated primarily in the United States. The plaintiff in these cases may have no particular connection to the country in which the suit is filed. Nevertheless, the U.S. journalists or publications who are named as defendants in these suits must deal with the expense, inconvenience and distress of being sued in foreign courts, even though their conduct is protected by the First Amendment.
An example of why the legislation is necessary is found in litigation involving Dr. Rachel Ehrenfeld, a U.S. citizen and Director of the American Center for Democracy, whose articles have appeared in the Wall Street Journal, the National Review, and the Los Angeles Times. She has been a scholar with Columbia University, the University of New York School of Law, and Johns Hopkins, and has testified before Congress. Dr. Ehrenfeld's 2003 book, ``Funding Evil: How Terrorism is Financed and How to Stop It'', which was published solely in the United States by a U.S. publisher, alleged that a Saudi Arabian subject and his family financially supported Al Qaeda in the years preceding the attacks of September 11. He sued Ehrenfeld for libel in England, although only 23 books were sold there. Why? Because under English law, it is not necessary for a libel plaintiff to prove falsity or actual malice as is required in the United States.
Dr. Ehrenfeld did not appear, and the English court entered a default judgment for damages, an injunction against publication in the United Kingdom, a ``declaration of falsity'', and an order that she and her publisher print a correction and an apology.
Dr. Ehrenfeld sought to shield herself with a declaration from both federal and state courts that her book did not create liability under American law, but jurisdictional barriers prevented both the Federal and New York State courts from acting. Reacting to this problem, the Governor of New York, on May 1, 2008, signed into law the ``Libel Terrorism Protection Act.'' Congress must now take similar action. I note that the person who sued Dr. Ehrenfeld has filed dozens of lawsuits in England, and there is a real danger that other American writers and researchers will be afraid to address this crucial subject of terror funding and other important matters. Other countries should be free to have their own libel law, but so too should the United States. Venues that have become magnets for defamation plaintiffs from around the world permit those who want to intimidate our journalists to succeed in doing so. The stakes are high. The United Nations in 2008 noted the importance of free speech and a free press, and the threat that libel tourism poses to the world.
Following the New York example, the legislation my co-sponsors and I introduce today confers jurisdiction on federal courts to bar enforcement of foreign libel judgments if the material at issue would not constitute libel under U.S. law. Significantly, it also deters foreign suits in the first place by permitting American defendants to countersue from the moment papers are served on them. Damages available in the countersuit include the amount at issue in the foreign libel suit as well as treble damages if the foreign suit is part of a scheme to suppress a U.S. person's first amendment rights.
This deterrent mechanism is critical because those who bring these foreign libel suits are more interested in intimidating the authors than in actually collecting damages. They know that even if a foreign judgment cannot be enforced in the United States, the cost of defending the suit and the penalty for taking a default judgment can have a chilling effect on American writers and publishers. In particular, under English law a contempt citation may issue against authors or publishers who fail to satisfy default judgments, pursuant to which their property may be seized and they may be imprisoned. What is worse, defendants can no longer skirt the consequences merely by avoiding contact with England. Under recent European Commission regulations, default judgments for monetary claims are enforceable in all EU countries except Denmark.
The potentially severe ramifications of a default judgment make clear that merely barring enforcement of a foreign libel judgment in U.S. courts is entirely insufficient particularly for publishers with European offices. While it is important to bar enforcement, in the words of a New York Times editorial, that does ``not go as far as it could.''
I often remark that the Senate is the world's greatest deliberative body and all the facts and arguments ought to be examined before it acts. Accordingly, I must address a letter in opposition to this bill from a prominent British libel lawyer and explain why his arguments are unpersuasive.
He notes that a ``U.S. citizen ..... knocked down by the negligent driving'' of a London taxi driver is ``just as entitled as any British citizen'' to sue in England for damages. Why should a U.S. citizen ``not be entitled on the same basis, like any other UK citizen, to sue for damages to his reputation?'' The answer, of course, is that the analogy is inapt. In that hypothetical, the plaintiff sues the defendant in the defendant's jurisdiction for a harm committed and suffered there, an injury that is universally recognized as a tort. By contrast, the plaintiff in a foreign libel action purposely avoids suing in the jurisdiction where the defendant journalist writes and publishes, a jurisdiction where the material is not libelous. The proper analogy would be if the injured American had sued the taxi driver in the United States instead of England because the driver's conduct would not constitute negligence under English law. That hardly seems fair play. Our bill is designed specifically to prevent such forum shopping.
That essay also asks whether ``legislators will extend their intervention'' to commercial matters such as contracts and debts and warns that such extension could trigger ``retaliatory action on the part of UK legislators.'' Actually, such extension has already happened, but at the hands of British legislators not American ones. In the antitrust context, British law bars enforcement of foreign judgments for treble damages such as those awarded by U.S. courts. In addition, it allows a British corporation, against whom a judgment for treble damages was entered in a foreign court, to recover from the plaintiff any excess over actual damages. In any event, this bill is confined to the narrow area of core First Amendment rights.
``Perhaps of most significance'' he continues in his letter, is that to his knowledge ``very few of these claims have actually come before UK courts.'' But it is the chilling effect and the mere threat of litigation that suffices to silence authors; there is no need to try the cases. In 2004, fear of a lawsuit forced Random House UK to cancel publication of ``House of Bush, House of Saud,'' a best seller in the U.S. that was written by an American author. Similarly, in 2007, the threat of a lawsuit compelled Cambridge University Press to apologize and destroy all available copies of ``Alms for Jihad,'' a book on terrorism funding by American authors. Indeed, an October 2008 study reported in The Guardian found that ``[m]edia companies are becoming less willing to fight defamation court cases all the way to a verdict. ..... With the burden of proof effectively resting on the defendant'' and attorneys' fees paid by the loser, defendants ``are forced to enter into settlement negotiations.''
Numerous organizations have endorsed the bill we offer today, including the ACLU and the Anti-Defamation League, as well as numerous journalists and publishers groups. Op-eds and editorials supporting our efforts have run in national papers, including the New York Times on September 15, 2008 and the New York Sun on July 28, 2008. Also drawing attention to the issue was an op-ed Senator Lieberman and I penned that ran in the Wall Street Journal on July 14, 2008.
Freedom of speech, freedom of the press, freedom of expression of ideas, opinions, and research, and freedom of exchange of information are all essential to the functioning of a democracy. They are also essential in the fight against terrorism.
I thank Senators Lieberman and Schumer, as well as Congressman PETE KING and his cosponsors for working with me on this important bill.
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