BILL ANALYSIS

C.S.H.B. 2884

By: Landgraf

Judiciary & Civil Jurisprudence

Committee Report (Substituted)

BACKGROUND AND PURPOSE

The bill's author has informed the committee of concerns brought to their office by defense contractors regarding the ability of America's enemies to weaponize courts against U.S. citizens and businesses by funding frivolous lawsuits. The bill's author further informed the committee that this is of special concern when pertaining to companies and individuals involved in national defense, as lengthy and expensive legal battles may jeopardize timelines and capital necessary to meet national defense objectives. C.S.H.B. 2884 seeks to resolve this issue by requiring a claimant involved in a civil action regarding the activities of a defense contractor, regardless of whether the contractor is a party, to disclose whether the claimant has received financial support from certain sanctioned or embargoed nations.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

C.S.H.B. 2884 amends the Civil Practice and Remedies Code to require a claimant in a civil action regarding the activities of a defense contractor, regardless of whether the contractor is a party, to disclose, as part of initial disclosures required under the Texas Rules of Civil Procedure, the following:

·whether the claimant or the claimant's attorney has received, directly or indirectly, funding or financial support from any individual, entity, or government affiliated with a sanctioned or embargoed nation; and

·the identity of all such sources of funding or financial support.

The bill establishes that such a claimant has a continuing obligation to supplement the disclosures required by the bill during the pendency of the action with information on such receipt of money or identification of sources that occur after the initial disclosures are made.

C.S.H.B. 2884 requires an initial or supplemental disclosure to be made under oath and filed with the court and requires a claimant to make such a disclosure not later than the 10th day after the date the claimant or the claimant's attorney receives the money or identifies a source of funding or financial support, as applicable.

C.S.H.B. 2884 prohibits an initial or supplemental disclosure from being delayed, excluded, or withheld for any reason, including because of a claim the information is privileged or otherwise exempted from disclosure. The bill prohibits a court from granting a motion by a claimant to limit the disclosure of proprietary or confidential information related to money or sources of funding or financial support required to be disclosed under the bill's provisions. The bill authorizes the court, if a claimant fails to comply with the bill's provisions, to stay the proceeding until the required disclosure is made or dismiss the action with prejudice on a finding of wilful noncompliance, in addition to any other sanctions the court is permitted to impose under law. The bill applies only to an action that is pending in a trial court on the bill's effective date or that is filed on or after the bill's effective date.

C.S.H.B. 2884 defines the following terms for purposes of its provisions:

·"defense contractor" as any entity that is engaged in the production, manufacturing, or provision of defense articles or defense services to the U.S. Department of Defense (DOD) under the federal International Traffic in Arms Regulations; and

·"sanctioned or embargoed nation" as any foreign nation subject to sanctions or an embargo under the federal Arms Export Control Act, as determined by the U.S. Department of State.

EFFECTIVE DATE

On passage, or, if the bill does not receive the necessary vote, September 1, 2025.

COMPARISON OF INTRODUCED AND SUBSTITUTE

While C.S.H.B. 2884 may differ from the introduced in minor or nonsubstantive ways, the following summarizes the substantial differences between the introduced and committee substitute versions of the bill.

The substitute changes the applicability of the bill's provisions from a civil action brought against a defense contractor, as in the introduced, to a civil action regarding the activities of a defense contractor, regardless of whether the contractor is a party.

Whereas the introduced defined "defense contractor" as any entity that is engaged in the production, manufacturing, or provision of goods or services to the DOD and is a party to a contract subject to the federal Arms Export Control Act, as implemented by the federal International Traffic in Arms Regulations, the substitute defines "defense contractor" as any entity that is engaged in the production, manufacturing, or provision of defense articles or defense services to the DOD under the federal International Traffic in Arms Regulations.