By Dan Morgan
Washington Post Staff Writer
Friday, November 15, 2002; Page A07

Riding along on legislation to create a new federal Department of Homeland Security is a White House-backed provision that could head off dozens of potential lawsuits against Eli Lilly and Co. and other pharmaceutical giants.

Elsewhere in the sprawling measure is language that would help the FBI obtain customer information from Internet service providers and increase the penalties for computer hacking. These and other last-minute additions to the bill by Republican leaders could have implications well beyond the measure's immediate goal of protecting the homeland, congressional officials said yesterday.

Lawyers for parents of autistic children suing pharmaceutical companies over childhood vaccines charged yesterday that a new section in the homeland bill -- passed on Wednesday by the House and now before the Senate -- would keep the lawsuits out of state courts, ruling out huge judgments and lengthy litigation. Complaints, instead, would be channeled to a federal program set up 14 years ago to provide liability protection for vaccine manufacturers. The program, funded through a surcharge on vaccines, compensates persons injured by such vaccines, to a maximum of $250,000.

"The industry has seized the opportunity presented by a Republican House and Senate to immediately pass legislation to get the industry off the hook," said Dallas lawyer Andrew Waters. "To me, it looks like payback for the fact that the industry spent millions bankrolling Republican campaigns."

GOP officials said the provisions are merely aimed at protecting companies working on life-saving products from being dragged into costly litigation by trial lawyers. Pharmaceutical companies were among the largest contributors to Republicans in this year's elections, while trial lawyers heavily backed Democrats.

In the past several years, some families have alleged a connection between their children's autism and vaccines using the preservative Thimerosal, which contains mercury. Medical studies have not proven a connection between Thimerosal and autism, but companies stopped using the preservative several years ago.

Eli Lilly, once the largest maker of Thimerosal, is a major target in a spate of lawsuits filed since 2000. The company stopped making the product in 1980 but continued to buy it from other manufacturers and to resell it for another decade.

Company spokesman Edward Sagebiel said Lilly was "surprised when the language was inserted" because it had not actively lobbied for it in recent months. But he said the company "believes it is a positive step to help assure that manufacturers are protected from lawsuits that are without merit or scientific evidence."

Richard Diamond, a spokesman for retiring House Majority Leader Richard K. Armey (R-Tex.), said the provision was inserted because "it was something the White House wanted. It wasn't [Armey's] idea." But Diamond said the principle is good. "We don't want companies to be steered away from the business of making things that can save lives," he said.

Elsewhere in the bill, Republicans incorporated the entire Cyber Security Enhancement Act, which the House passed overwhelmingly in July but which made little progress in the Democratic-controlled Senate. To strengthen law enforcement's hand in protecting the security of computer communications, the legislation would increase penalties for hacking and other malicious computing. Privacy advocates have criticized some provisions, particularly those that would lower the threshold for Internet service providers to give law enforcement agencies customer communications without a court order.

The bill would make hacking punishable by as much as life in prison if the offender "knowingly or recklessly causes or attempts to cause death.''

Cut from the bill was a Democratic-backed provision that would have prevented the new federal agency from giving contracts to U.S.-based companies that use offshore addresses to avoid corporate taxes.

GOP aides said the language originally offered by Rep. Tom DeLay (R-Tex.), and now incorporated in the bill, gives Texas A&M the inside track in hosting the first university center on homeland security, to be established within one year. DeLay was elected Wednesday to serve as the House majority leader in the 108th Congress.

Yesterday, Senate Democrats were considering trying to strip non-relevant provisions from the homeland security bill during the final debate. If successful, such a move could derail Congress's timetable for adjourning, by forcing a new round of House-Senate negotiations to resolve differences in the legislation.

Staff writer Jonathan Krim contributed to this report.