This is an article that is scheduled to be published in the upcoming issue of the Kentucky Justice Association's Advocate Magazine.
By: Lawrence L. Jones II
Almost all attorneys have at least a vague understanding of what a "mass tort" is but few know about the Multi-District Litigation (or "MDL") device that was created by Congress in 1968 to efficiently manage mass tort litigation in federal courts. Many Plaintiffs' lawyers try to avoid the MDL process like the plague. These lawyers believe that an MDL ultimately delays the resolution of their clients' cases because of the lengthy "life cycle" of an MDL. Some also resent paying a "case tax" (sometimes as high as 10%) to the members of the MDL's steering committee, a panel of lawyers appointed by the transferee court to litigate the issues common to all of the cases.
Regardless of what your thoughts are about the MDL process, it pays to know what an MDL is before your case suddenly becomes part of one against your will. The following is a primer based upon the author's experiences handling numerous MDL cases, both as class counsel and as appointed members on the Plaintiff's Steering Committee and various subcommittees.
What is the Judicial Panel on Multi-District Litigation?
Congress created the United States Judicial Panel on Multi-District Litigation with its passage of 28 U.S.C. §1407. The MDL Panel consists of seven United States District and Circuit Court Judges (each serving a seven-year term), including its Chairman. Unbeknownst to many Kentucky attorneys, United States District Court Judge John G. Heyburn II currently serves in the prestigious role of Chairman of the MDL Panel. The Chief Justice of the United States Supreme Court selects both the Chair and the MDL panelists.
The MDL Panel was created by Congress to determine whether civil cases filed in various federal jurisdictions share common questions of fact that may make them appropriate for centralization in one federal district court for coordinated pre-trial proceedings. This centralization process is intended to avoid duplicative discovery, to prevent inconsistent pretrial rulings in factually similar cases and to conserve the resources of the parties who may be managing hundreds or even thousands of similar cases across the United States.
Since its creation, the MDL Panel has considered centralization motions involving more than 300,000 cases, involving millions of claims. While many think of the MDL process as something that applies to pharmaceutical cases, the MDL Panel's docket is much more diverse. In addition to pharmaceutical cases, the MDL Panel has considered cases involving wage and hour litigation, airplane crashes, train wrecks, hotel fires, asbestos, securities and financial fraud, antitrust, and patent cases. However, it is true that the bulk of the MDL Panel's docket does include pharmaceutical cases.
How does a case get selected for MDL treatment?
A case does not just automatically get selected for MDL treatment; one of the parties must ask for such treatment. To begin the process of creating an MDL, a party must file a motion pursuant to 28 U.S.C. §1407 requesting centralization of all similar cases for purposes of conducting pre-trial proceedings. The motion is filed with the MDL Panel and a copy of such motion must be filed with district court in which action is pending. Koerner & Associates, Inc. v. Aspen Labs, Inc., 492 F.Supp 294 (S.D. Tex. 1980).
The party seeking centralization must make a showing that the pending cases are factually similar and that centralization will benefit the parties and conserve judicial resources. The moving party bears a strong burden of showing that common questions of fact are so complex and that the accompanying discovery is so time consuming as to overcome the inconvenience to the party whose action is being transferred. In re Interstate Medicaid Patients at Good Samaritan Nursing Center, 415 F.Supp 389 (JPML 1976).
Is there anything I need to know about practicing before the MDL Panel?
If one intends to practice before the MDL Panel, you are advised to carefully review the Rules of Procedure of the Judicial Panel on Multi-District Litigation. The Rules are a guide to the MDL Panel's mandates for such things as service of process, number of copies, style of pleadings, and relevant deadlines.
For illustrative purposes, the following scenario assumes that it is the plaintiff who has filed a 1407 motion for centralization, although defendants also file such motions because of the economic advantages of litigating and/or settling hundreds or thousands of cases in a centralized manner.
After a plaintiff files a 1407 motion seeking centralization, the MDL clerk will notify all of the parties of the motion's filing date, caption, MDL docket number, briefing schedule and the pertinent MDL Panel policies. JPML Rule 7.2(b). The defendants must respond within 20 days (or seek an extension of time pursuant to JPML Rule 6.2) or the Defendant is deemed to have acquiesced to the request for MDL centralization. JPML Rule 7.2(c).
The initial motion for centralization must include averments in numbered paragraphs, each of which shall be limited, as far as practicable, to a statement of a single factual averment. The response to those averments in motions shall be made in numbered paragraphs, each of which shall correspond to the number of the paragraph of the motion to which the responsive paragraph is directed. Much like an answer to a complaint, each responsive paragraph must admit or deny wholly or in part the averment of the motion, and shall contain the respondent's version of the subject matter when the averment or the motion is not wholly admitted. JPML Rule 7.2.
Within eleven days after the motion for MDL transfer is filed, each party or designated attorney must enter an appearance by notifying the MDL Panel's Clerk, in writing, of the name and address of the attorney designated to receive service of all pleadings, notices, orders and other papers relating to practice before the MDL Panel. JPML Rule 5.2(c). Only one attorney shall be designated for each party.
The response to the 1407 motion, which is due within 20 days, must also include a brief in support thereof in which the background of the litigation and factual and legal contentions of the respondent shall be concisely stated in separate portions of the brief with citation to applicable authorities. JPML Rule 7.2(a)(i). All briefs are limited to twenty pages, exclusive of exhibits, unless the MDL Panel orders otherwise. JPML 7.2(f).
In addition to the response brief, each responding party is required to simultaneously file a one page statement indicating the responding party's position regarding whether oral argument before the MDL Panel is necessary or not, including the reasons why. JPML Rule 16.1(b).
If there is an objection to the 1407 motion for centralization, the MDL Panel will not transfer the case without a hearing on the motion except in cases where the MDL Panel determines that: (i) the dispositive issues have been authoritatively decided; or (ii) the facts and legal arguments are adequately presented in the briefs and record, and oral argument would not be helpful to the MDL Panel's decision-making process. JPML Rule 16.1(c).
All parties and counsel are also required to promptly notify the MDL Panel's Clerk of any potential "tag-along actions" in which that party is also named or in which that counsel appears. JPML Rule 7.2(i). A "tag-along action" refers to a case that is pending in a federal district court and involving common questions of fact with actions previously transferred under Section 1407. JPML Rule 1.1.
Once the MDL Panel schedules the oral argument which normally takes place at the MDL Panel's next bi-monthly hearing, you will appear at the hearing to present reasons why the cases should be centralized and to argue to the MDL Panel which jurisdiction would be appropriate for centralization.
Once at the MDL Panel's hearing, it is very important that counsel limit oral argument to the "appropriate criteria" as spelled out in In re East of the Rockies Concrete Pipe Antitrust Cases, 302 F. Supp. 244, 255-56 (J.P.M.L. 1969). In sum, there are twenty questions that the East of the Rockies case focuses on.
Among other things, the MDL Panel wants to know a) How many common questions of fact are there and what is the nature of the common questions?; b) How many cases have been filed, where they are currently venued, whether additional cases will be filed and the anticipated venues of those filings; c) Whether transfer and centralization will operate to save the parties and the courts from duplicative work and inconsistent rulings; d) What detriment, financial or otherwise, will be imposed upon any of the parties by ordering transfer?; e) Are pretrial proceedings already far along in any one or more of the cases?; f) What is the availability of a judge in the proposed transferee court or courts?; g) Will the advantages of transfer and centralization overcome the normal desirability of having the same judge who conducts the trial also conduct pretrial proceedings?; and h) Will transfer and centralization impede or promote the prospect of settlements?
The hearing itself is a very interesting experience. Hundreds of plaintiff and defense lawyers come from across the country to attend the MDL hearing. Yet, most of the lawyers are merely observers since the MDL Panel limits the oral argument time. If the plaintiffs and the defendants agree that the cases should be centralized, then the arguments many times focus on which court would be the appropriate transferee court. Factors argued by the parties, and considered by the Court, are: a) Whether the proposed venue has a major airport nearby which would accommodate counsel traveling from across the country; 2) The location of the corporate defendants; 3) The proximity of evidence and witnesses to the proposed venue; and 4) The desire of the proposed transferee judge to handle a complex and time-consuming MDL proceeding.
What Happens After the MDL Hearing?
The MDL Panel is generally pretty quick with its decisions. The MDL Panel usually issues a ruling on 1407 motions within two weeks after the hearing. The order will mandate whether or not the cases are to be centralized and, if so, to which federal district court judge the cases are transferred. So, generally, the process takes approximately 90 days from the filing of the motion until the MDL Panel's ruling is issued -which has been a marked improvement under Judge Heyburn's leadership.
Once the MDL Panel chooses the transferee court, the transferee judge assumes control over all current and future cases involving the common questions and common defendants. In re Equity Funding Corp. of America Securities Litigation, 375 F.Supp 1378 (JPML 1973) (It is province of Judicial Panel to decide in the first instance whether litigation should be transferred for coordinated or consolidated pretrial proceeding while it is the province of transferee judge to determine whether and to what extent the trial proceedings should be coordinated or consolidated.) Indeed, the transferee court assumes complete jurisdiction for pre-trial purposes and has authority to settle all pre-trial motions including dispositive motions such as those for summary judgment or approval of a settlement. In re Agent Orange Product Liability Litigation, 597 F.Supp 740 (E.D.N.Y. 1984), affirmed, 818 F.2d 145, cert. denied, 108 S.Ct. 695, 484 U.S. 1004, 98 L.Ed.2d 648, on remand, 689 F.Supp. 1250. The transferee court is also authorized to handle matters relating to class action certification in order to prevent inconsistent rulings and to promote judicial efficiency.
After the MDL Panel issues its ruling and transfers the cases for coordinated proceedings, the transferee judge promptly schedules a conference with all lawyers involved in the litigation. At this initial status conference, the transferee court will begin to address case management issues (such as electronic preservation of evidence, the use of master complaints, service of process issues, etc.) that will be included in the Case Management Order (or "CMO"). Additionally, the Court usually appoints temporary lead or liaison counsel to be the spokespersons for the Plaintiffs and the Defendants, until such time as permanent lead or liaison counsel can be appointed.
Since there may be hundreds or even thousands of plaintiff lawyers involved in a particular MDL, the transferee court cannot possibly accommodate having that many lawyers appear at hearings and expect to be heard. Therefore, the transferee court
will issue an order relating to applications for a position on the Plaintiff's Steering Committee ("PSC"). Alternatively, the Court may ask the temporary lead counsel to propose a "slate" for potential appointment on the PSC. Sometimes the applications, which are largely recitations of one's experience with complex cases, can be quite colorful. In the recent round of applications for the Toyota MDL, one lawyer touted that he had donated an organ to a family member as an example of his selfless nature.
After the PSC is appointed by the court, the lawyers on the PSC will control the litigation for all of the non-PSC members. All case strategy and much of the day-to-day work is completed by the PSC and the various "sub-committees" created by the PSC. Yet, once the discovery is complete regarding the issues common to all of the cases, the PSC's work is done and the individual cases are remanded to their home district for trial.
What happens after the discovery is finished?
After several years of being constantly bombarded with electronic filings from the MDL case, one day you may realize that the parties have finally completed discovery. By this time, Daubert motions related to general causation experts have been resolved, expert depositions have been completed, and the corporate officers have been deposed. What happens next?
Well, the individual plaintiff lawyer finally regains control of his/her own individual case. As a benefit of the "tax" that you will be required to pay to the PSC upon settlement of your case, you will receive access to the millions of documents that have been unearthed during discovery. In fact, you will have access to all of the discovery completed in the case, including the expert depositions. From there, you are on your own to try your case (or engage experienced co-counsel chosen from the PSC) and hold the individual corporate wrongdoer accountable for its conduct.
Right or wrong, like it or not, this is how a case proceeds through the MDL process! If you don't like it, find a non-diverse defendant to sue and fight like mad to keep the action in state court.
Lawrence L. Jones II is a founding partner of Jones Ward PLC in Louisville, Kentucky. His firm focuses much of its practice on mass tort litigation in state and federal courts across the country. The firm is currently involved in several MDL proceedings. For more information about the author, visit www.the-recall-lawyers.com.
