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Mr. CONYERS. Well, Attorney Skirnick, Attorney Montague, and Attorney Ehrenbard, I only hope that we can get this lesson, this important message, this understanding of what this means to the American consumer and the general public out as quickly and as effectively as possible.

I mentioned to Don Edwards that I wish I cold really devote my time exclusively toward this issue. This is the one issue that pains me more than any other that is before the various committees on which I serve, that I can see the serious, long-term potential harm that will be visited if we can't get our forces together to head off this outrageous curtailment of the rights and protections that should be afforded our citizens.

We stand very deeply indebted to you for not just coming here today, but for the work that you have been doing on this matter. I think this is a very important part of the responsibility of lawyers in America, that make us proud of members of the bar, who are working in these very enormous, complex areas. You may not have a lot of little clients in the sense of the legal defense counsel or more neighborhood legal defense services, but in a way the work that you do protects millions of Americans who may never be your clients, because you are protecting them generically form misdeeds that would surely be felt ultimately economically by them.

So we are very, very much in your debt. Mr. Edwards, do you have any comments?

Mr. EDWARDS. I want to emphasize and underline what the chairman said. He has been almost all by himself on this issue for a long time, sort of Horatio at the bridge with some valuable help as we came along with Professor Blakey and the staff and people, very few people, like Ms. Gilbert.

The legislation was on a fast track. It was almost a fait accompli within a few days after it was introduced, and it still has a lot of support.

It is so valuable that you are here to encourage us, and to help us pass the word. I only have one quick question, Mr. Chairman, and that is, can somebody explain to me why the proponents of this change, this massive change in the law have such power? How come it is rolling so?

We even had a very respected former Member of Congress who is one of the most respected appeals court judges in the Federal system come up here and tell us that we have got to change the law.

Mr. EHRENBARD. Let me take a stab at that. As I was listening to Mr. Skirnick talk about the antitrust laws, it so happens that Mr. Skirnick's law firm and mine have very often and more likely, as Mr. Montague's firm, are on opposite sides of the fence, and quite a number of years ago, his firm and mine were on opposite sides of a very large antitrust case against the three largest automobile companies in the United States, General Motors, Ford, and Chrysler. In that case, the plaintiff's action sought damages that under the antitrust laws would have exceeded the combined net worths of General Motors, Ford, and Chrysler because the amount of damages and there was no dispute about the damages, in terms of how they could be measured.

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But because it involved a change in the pricing, involving fleet sales and it affected all the State and local governments of the United States and every fleet in the United States.

In 1 year the pricing changed. It was a significant change in pricing. So the amount of change in pricing was a known factor and the volume of vehicles was a known factor, so you could estimate the possible actual damages and if you trebled them, they could have exceeded the combined net worth of General Motors, Ford, and Chrysler.

Mr. SKIRNICK. We tried.

Mr. EHRENBARD. I would think in that kind of a case, we would be running to the plaintiffs scared to death and throw money at them, please, drop the case and go away. We-or we do what, if we thought we were guilty and this is the answer to your question, if you are really concerned, Congressman Edwards, about liability, then you really have something to worry about.

We weren't afraid. We thought we were right. We were ready to go to trial and we went to trial on a "bet your company" type of case, and in this case the net worth of General Motors, Ford and Chrysler were all exposed in a trial.

We thought we were right. We weren't afraid to try the case. We didn't throw money at the plaintiffs and say here is your extortion money. Tell us what it will take to settle this thing.

We knew we were confident and right that there was no violation of antitrust laws, and we didn't kowtow to anybody. We don't come to Congress, which is the answer to your question, we didn't run to Congress and say we want the antitrust amended to take away the treble damages because it is going to ruin the American auto industry.

We had confidence in the integrity of the courts and more importantly we were confident that we were innocent and we had nothing to be afraid of and we would go to trial and expose our companies to that risk and go to judgment on it. What happened was, of course, we won.

The case was dismissed and no settlement was paid and we weren't afraid. Now, in answer to your question, there are a lot of defendants out there in pending suits and prospective suits as well, who are deathly afraid that they know that they indeed are going to be held liable.

That is why you get the kind of money, the kind of support behind this kind of legislation, and we are not talking about nickels and dimes. We are talking about people who are exposed in terms of tens and hundreds of millions of dollars who can afford to put on the kind of propaganda campaign and lobbying effort.

How much-there are public records on this and how much has been spent on this lobbying effort and by whom? What are the exposures of those people in these cases?

Are they exposures of abuse, and are they afraid they are going to be sued in divorce cases or are they afraid they are going to be sued in matrimonial or decedent estate cases, employment discrimination cases?

No way. Let's not kid ourselves. We are talking about the people who have very large exposures and pending cases which involves tens and hundreds of millions of dollars and they are trying to

wipe out that liability and in effect expose pending cases by legislation.

Mr. CONYERS. How many people are there like yourselves out there in the field, Mr. Montague? Are we talking about a small group, a band of fellows comparable to the small group in Congress or is there some growing responsibility on the part of the bar? Are there other practitioners who may not be working civil RICO that nevertheless realize the implications of what is going on here?

Mr. MONTAGUE. Mr. Chairman there really is a small band, and I must say it does my heart good to hear Mr. Ehrenbard speak as he did today because normally, as he said, we are on the other side of the fence, and we usually clash in our thoughts.

The reason is that it is a small band and I am not just talking about RICO, but I am talking about the firms that take on plaintiffs' antitrust work and take on plaintiffs' securities work and take on plaintiffs' business fraud type of work. The reason that basically those are small firms is because large firms, not all, but more often than not find themselves in a conflict of interest so that even if they wanted to take those cases, they can't. Frankly, very often, many of the cases which we get are referred to us by other firms that can't handle them because of those conflicts of interest. So the type of firms that handle this kind of litigation, I guess, are called the American lawyer called them-boutiques, rather than big firms. Although, we have 35 lawyers and we do nothing but complex Federal litigation.

Mr. CONYERS. We are indebted to you and we thank you very much and the subcommittee stands adjourned.

[Whereupon, at 1:50 p.m., the subcommittee adjourned, to reconvene subject to the call of the Chair.]

APPENDIX

STATEMENTS SUBMITTED FOR THE HEARINGS RECORD

STATEMENT OF

ARTHUR H. BRYANT, EXECUTIVE DIRECTOR
TRIAL LAWYERS FOR PUBLIC JUSTICE, P.C.

Good morning. My name is Arthur Bryant. I am the Executive Director of Trial Lawyers for Public Justice, a national public interest law firm specializing in precedent-setting and socially significant damage litigation. I am here today to express my opposition to the proposal in one of the present bills, H.R. 2983, to eliminate the availability of automatic treble damages under RICO.

At the outset, I feel it is important to point out that Trial Lawyers for Public Justice is a public interest law firm that litigates. Essentially, we use the common law, RICO, and other legal remedies to act as private attorneys general, exposing outrageous conduct and making the wrongdoers pay. We do no lobbying and, frankly, Congress is not a forum before which we usually appear. Given the drastic effects that the proposed elimination of automatic treble damages under RICO would have on all victims of organized criminal activity, however, I am grateful for the invitation and opportunity to testify today. From a public interest litigator's perspective, there are three reasons why RICO's automatic treble damage provision is so important. First, it creates a powerful disincentive for organized criminal conduct

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a disincentive that otherwise would

not exist. Second, it creates the only possibility that victims

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