Senate Republicans gave final approval to a bill that would cap non-economic damages in commercial vehicle lawsuits, sending it to Iowa Gov. Kim Reynolds for a signature.
Senate File 228 would cap non-economic damages at $5 million in lawsuits involving commercial vehicles and limit employer liability. Economic damages would not be capped, and all punitive damages would go to the plaintiff. The bill defines commercial vehicles as those weighing more than 26,000 pounds, road tractors, some livestock transportors or those transporting hazardous materials. It does not include vehicles designed for 16 or more passengers, including buses, or delivery or pickup trucks used for commercial purposes.
The Senate passed the bill 31-19 mostly along party lines, with three Republicans voting no with Democrats.
Sen. Mike Bousselot, an Ankeny Republican and the bill’s floor manager, said the goal is “protecting Iowans who are injured while lowering and protecting predictability and stability for our critical components of our supply chain.”
Supporters of the measure, including business groups and trucking companies, argue it would prevent so-called nuclear verdicts that levy hundreds of millions of dollars in judgments against trucking companies. They also argue the limits would reduce insurance rates and bring certainty to a vital industry.
Opponents of the measure said it takes away Iowans’ rights to a jury trial in litigation involving serious injury or death caused by a commercial vehicle’s negligence. In addition to Senate Democrats, the bill’s opponents include trial lawyers and justice groups.
The bill would cap damages from death, injury and other non-economic sources in lawsuits involving commercial vehicle drivers and companies at $5 million. The cap would not apply if a commercial vehicle driver:
- Drove under the influence of drugs or registered an alcohol concentration of 0.04 or more
- Refused an alcohol test
- Committed a felony using the vehicle
- Used the vehicle to illegally manufacture or distribute a controlled substance
- Drove without a commercial license or one that was suspended or revoked
- Drove recklessly or while using an electronic device
- Exceeded the speed limit by more than 15 mph
The bill’s liability shield for employers does not apply for direct negligence in supervising, training or trusting an employee.