Bush signs off on Bill to eliminate 'junk lawsuits'

In the first major legislative victory of his new term, President George Bush signed into law yesterday a Bill to curb massive class action cases against companies, hailing "a critical step towards ending the lawsuit culture in our country".

In the first major legislative victory of his new term, President George Bush signed into law yesterday a Bill to curb massive class action cases against companies, hailing "a critical step towards ending the lawsuit culture in our country".

The Bill, approved last week by votes of 72 to 26 in the Senate and 279 to 149 in the House, is the culmination of a year-long effort to eliminate "junk lawsuits".

It is a defeat for the Trial Lawyers lobby, a key financier of the Democratic party, and a sign of how the tighter Republican grip on Congress now works to Mr Bush's advantage.

Previous attempts to push through the measure foundered on entrenched Democratic opposition, especially in the Senate. But this week a substantial number of Democrats, including some liberals, voted in its favour.

The key provision shifts most large, class action suits from state courts to federal courts, where judges are historically less sympathetic to plaintiffs, and less likely to admit cases to trial. Cases involving damages of more than $5m (£3m) and more than 100 plaintiffs will be tried only at state level when two-thirds of plaintiffs and the chief defendant corporation are from that particular state.

Mr Bush claims the Bill will help staunch a $240bn (£127bn) annual drain on the economy. "This helps fix the system," he said at the signing ceremony, in the formal East Room of the White House. "Congress has done its duty."

But the Bill is only the first, and easiest, part of the President's three-pronged tort reform offensive. He is also seeking to impose a $250,000 cap on medical malpractice suits ­ a limit even some of his supporters regard as too low.

A catch-all $140bn trust fund to put an end to all outstanding asbestos litigation is also running into trouble on Capitol Hill.

Even so, consumer groups were furious at their defeat this week. Helen Gonzales, of USAction said: "The House joined the Senate in sending a clear message, that the rights of corporations that take advantage of seniors and low-wage workers are more important than the rights of average American citizens."