JPML Releases MDL Stats

 The U.S. Judicial Panel on Multidistrict Litigation recently released the data on requests for coordination and dispositions in 2012, and some interesting trends can be detected.

Specifically, the Panel has shown an increasingly strict view of MDL requests.  In the early years of the last decade, the Panel routinely granted most requests, and even as recently as 2007-09 the Panel was granting 4 out every 5 requests.  Since then, however, the panel has denied more than 40% of the MDL requests.

One theory for the change is the increase over time in the number of petitions made, but that trend has actually started to level off in recent years.  And the Panel has always maintained it has sufficient able federal judges to mange the MDL's.

Another theory has to do with the feedback received by the Panel from judges and practitioners in a 2010 survey of MDL practice.  Much of that feedback discussed the Panel's ostensible preference for centralization.  The Panel now may have a deeper appreciation for the costs and economics of creating an MDL.

A third theory is that CAFA and federal court scrutiny of class actions has pushed more cases into the MDL stream, and sooner, although it is hard to confirm any rampant prematurity phenomenon.

Another is a possible change in the mix of cases proposed for MDL status.  Recent cases may have smaller numbers of parties, more varied filing dates, differing defendants, and different subject matters -- fewer antitrust matters and more consumer fraud claims, for example.  

 

 

Court of Appeals Applies CAFA Mass Action Provision

The Seventh Circuit has resolved a conflict between district court decisions about whether a motion to consolidate and transfer related state court cases to one circuit court constitutes a proposal to try the cases jointly triggers the “mass action” provision of the Class Action Fairness Act (“CAFA”).  The court held that plaintiffs’ motion to consolidate did propose a joint trial, and thus removal was proper. See In re Abbott Laboratories Inc., No. 12-8020 (7th Cir. 10/16/12).
 

Between August 2010 and November 2011, several hundred plaintiffs filed ten lawsuits in three different Illinois state courts for personal injuries they alleged were caused by Depakote, a prescription medication.  Later, plaintiffs moved the Supreme Court of Illinois to consolidate and
transfer their cases to one venue, St. Clair County. In the memorandum in support of their motion, plaintiffs indicated they were requesting consolidation of the cases through trial and not solely for pretrial proceedings. Defendant removed each of the cases to federal court (in two districts) asserting that the motion to consolidate brought the cases under CAFA’s “mass action” provision, which allows the removal of any case where 100 or more people propose to try their claims jointly. Plaintiffs moved to remand in both courts.

The Southern District granted the motion to remand, concluding that the language in the motion to consolidate did not propose a joint trial. The Northern District court denied plaintiffs’ motion to
remand, noting that the motion to consolidate clearly sought to consolidate the 10 complaints for all purposes, including for purposes of conducting a trial.  Plaintiffs argued on appeal that they did not specifically propose a joint trial because their motion to consolidate did not address how the trials of the various claims in the cases would be conducted, other than proposing that they all take
place in St. Clair County. In plaintiffs’ view, for the mass action provision to apply, they would have needed to take the further step of requesting a joint trial or an exemplar trial that would affect the remaining cases.

The court of appeals noted that plaintiffs argued that they never specifically asked for a joint trial, but a proposal for a joint trial can be implicit. See Bullard v. Burlington Northern Santa Fe Railway
Co., 535 F.3d 759 (7th Cir. 2008).  A joint trial does not have to encompass joint relief. For example, a trial on liability could be limited to a few plaintiffs, after which a separate trial on damages could be held. Similarly, a trial that involved exemplary plaintiffs, followed by application of issue or claim preclusion to more plaintiffs without another trial, would be one in which the claims of 100 or more persons are being tried jointly. In short, said the court of appeals, a joint trial can take different forms as long as the plaintiffs’ claims are being determined jointly.

Here, plaintiffs may not have explicitly asked that their claims be tried jointly, but the language in their motion came close. Plaintiffs requested consolidation of their cases “through trial” and “not solely for pretrial proceedings.” They further asserted that consolidation through trial “would also facilitate the efficient disposition of a number of universal and fundamental substantive questions applicable to all or most Plaintiffs’ cases without the risk of inconsistent adjudication
in those issues between various courts...”  It is difficult to see how a trial court could consolidate the cases as requested by plaintiffs and plaintiffs’ claims would somehow not be tried jointly. Although the transferee court will decide how their cases proceed to trial, it does not matter whether a trial covering 100 or more plaintiffs actually ensues; the statutory question is whether one has been proposed.

The court thus reversed the Southern District's grant of the plaintiff's motion to remand and affirmed the Northern District's ruling. 

JPML Declines MDL Status for Surgical Robots

We have posted before about the MDL process and the importance of the initial decision by the Panel on ordering coordination. Last week the Judicial Panel on Multidistrict Litigation declined to consolidate the suits by plaintiffs alleging injuries from da Vinci surgical robots. See In re Da Vinci Robotic Surgical System Products Liability Litigation, MDL No. 2381 (J.P.M.L., , 8/3/12).

We like to flag for readers, for any insights they may offer, the less common decisions rejecting MDL status, see also here and here. Also here. See here.

At the time of the decision there were five cases pending in five different federal courts. Defendant Intuitive Surgical, Inc. also supported the motion. The parties even agreed on centralization in the Northern District of California.

But the Panel was not persuaded that Section 1407 centralization would serve the convenience of the parties and witnesses or further the just and efficient conduct of this litigation. Each action, said the Panel, alleged personal injuries arising out of alleged defects in the da Vinci Robotic Surgical System. These are "relatively straightforward personal injury or wrongful death actions,"   and the litigation may focus to a large extent on individual questions of fact concerning the circumstances of each patient’s alleged injuries.

Given the "minimal number of actions currently pending," the proponents of centralization failed to convince the Panel that any factual questions shared by these actions are sufficiently complex or
numerous to justify Section 1407 transfer. The court noted that the proponents maintained that this litigation may eventually encompass “hundreds” of cases or “over a thousand” cases. But the Panel declined to accept such predictions, and considered voluntary coordination among the parties and the involved courts of these relatively actions to be a preferable alternative to centralization at this time.

MDL Panel Declines to Coordinate Spread Litigation

The Judicial Panel on Multidistrict Litigation declined recently to consolidate three suits by plaintiffs who alleged Ferrero U.S.A. Inc. misrepresented Nutella hazelnut spread as a healthy and nutritious food. In re Nutella Marketing and Sales Practices Litigation, MDL No. 2248 (J.P.M.L.,  8/16/11).

We are always interested when the Panel declines to coordinate cases, but also have to admit that this is a favorite product in the MassTortDefense household.  The spread, in its earliest form, was created in the 1940s by Mr. Pietro Ferrero, a pastry maker and founder of the Ferrero company. At the time, there was very little chocolate because cocoa was in short supply due to World War II rationing. So Mr. Ferrero used hazelnuts, which were plentiful in the Piedmont region of Italy, to extend the chocolate supply. The region is mostly mountains and hills, on the north-western border of Italy with France and Switzerland.

A plaintiff in the District of New Jersey action sought consolidation, arguing that the cases made similar allegations challenging Ferrero's marketing and advertising practices. Interestingly, movants and respondents both recommended centralization because the actions contained "similar allegations" concerning Ferrero’s advertising, marketing and sale of Nutella spread and its alleged misrepresentations of Nutella as a healthy and nutritious food. All parties disagreed only as to the appropriate choice for transferee district.

However, the Panel noted that it has an institutional responsibility that goes beyond simply accommodating the particular wishes of the parties. See In re: Equinox Fitness Wage and Hour Empl’t Practices Litig., 764 F. Supp. 2d 1347, 1348 (J.P.M.L. 2011) (denying unopposed motion for centralization of two actions).

Here, the Panel was not persuaded that Section 1407 centralization was necessary for the convenience of the parties and witnesses or for the just and efficient conduct of this litigation. The actions may have shared some factual questions regarding the common defendant’s marketing
practices, but these questions did not appear complicated to the Panel. Indeed, the parties did not persuade the Panel that any common factual questions were sufficiently complex or numerous to justify Section 1407 transfer.  Instead, said the Panel, cooperation among the parties and deference among the courts should minimize the possibility of duplicative discovery and inconsistent pretrial rulings. See, e.g., In re: General Mills, Inc., Yoplus Yogurt Prods. Mktg. and Sales Practices Litig., 716 F. Supp. 2d 1371 (J.P.M.L. 2010).

 

Consolidated Benlate Trials Improper

A Florida appeals court recently reaffirmed its prior ruling granting new trials and reversing approximately $20 million in verdicts against defendant DuPont.  See Agrofollajes, S.A., et al., v. E.I. Du Pont De Nemours & Company, Inc., 2010 WL 4870149  (3d DCA, 12/1/10). The court had issued a prior opinion in December, 2009, but it then granted the farmers' motion for a rehearing.

This action involved the mass, consolidated tort cases commenced by twenty-seven Costa Rican growers of leatherleaf ferns against Du Pont, alleging product liability claims for injuries allegedly caused by Benlate, a systemic fungicide that Du Pont manufactured and marketed. Leatherleaf fern is an ornamental crop, a brightly colored and symmetrically shaped fern that florists use to enhance cut flower arrangements. The plaintiffs are commercial growers of leatherleaf fern in Costa Rica who grow the ferns for a worldwide market, providing ferns mostly for Europe and Japan. The complaints alleged that the plaintiffs’ leatherleaf fern plants were damaged by Du Pont
because: (1) the Benlate was cross-contaminated with other chemicals that were manufactured at the same facility, and (2) Benlate DF broke down into DBU, a herbicide-like agent called dibutylurea (DBU), which was toxic and caused the plant damage.

The plaintiffs sought a consolidated trial, representing to the trial court that consolidation would be more efficient because there were "many common issues" between the claims.  Conversely, Du Pont alleged substantial differences in the plaintiffs’ Benlate use, farm management, growing conditions, growing practices, chemical uses, periods in which deformities materialized, plant disease problems experienced, and damage claims. DuPont also proffered different alternative causes for the plant damages at the various ferneries. DuPont proposed that the court schedule either one fernery or one group of ferneries, under common management, as individual
plaintiffs in separate trials. The trial court nevertheless ordered a single, consolidated trial of
the claims by all twenty-seven plaintiffs.  At trial, however, the plaintiffs’ opening statement re-characterized the "common issues." The plaintiffs acknowledged instead that there was only one
material issue that was common to all the plaintiffs, the use of Benlate.  The evidence presented at trial substantiated the many differences that existed among the individual plaintiffs, including use of Benlate, use of other chemicals, and regarding the ferneries.

After an eight-week trial during which the parties introduced considerable evidence that alleged disparate material facts among the twenty-seven individual plaintiffs, the jury deliberated for five days. The jury found against DuPont on negligence and awarded each of the twenty-seven consolidated plaintiffs identical awards. The jury awarded every plaintiff the same percentage, sixty percent, of the past damages claimed.

On appeal, DuPont argued that the trial court denied defendant a fair trial by improperly consolidating plaintiffs’ twenty-seven disparate claims.  In deciding whether to consolidate cases, a Florida  trial court must consider: (1) whether the trial process will be accelerated due to the consolidation; (2) whether unnecessary costs and delays can be avoided by consolidation; (3) whether there is the possibility for inconsistent verdicts; (4) whether consolidation would
eliminate duplicative trials that involve substantially the same core of operative facts and questions of law; and (5) whether consolidation would deprive a party of a substantive right.  The court said that Florida courts have noted that Florida Rule of Civil Procedure 1.270(a) essentially “duplicates” Federal Rule 42(a).

The issues were with items four and five. The record demonstrated that the common issues did not predominate at trial. As plaintiffs’ counsel's candid opening statement remark confirmed, other than Benlate, the plaintiffs “don’t have anything else in common.”  Illustrative of the disparate experiences: fourteen ferneries claimed that the damage appeared immediately while others claimed that the symptoms did not appear for years. The plaintiffs’ ferneries were located in different areas of Costa Rica and were situated at different elevations, resulting in different climates and growing environments for the plants. The ferneries also experienced distinctive problems controlling pests and fungus and were subject to unique issues regarding hurricane damage, flooding, poor sunlight, over-harvesting and inadequate drainage.

DuPont further claimed that consolidation was not proper because it was deprived of a substantive right, as consolidation of the twenty-seven claims resulted in unfair prejudice to it. Unfair prejudice as a result of consolidation is a broadly recognized principle. The Florida Supreme Court in State v. Williams, 453 So. 2d 824, 825 (Fla. 1984), held that “even if consolidation is the ‘most
practical and efficient method of processing’ a case, practicality and efficiency should not outweigh a defendant's right to a fair trial.”  Here, the jurors were asked to recall a vast assortment of unique facts for each of the twenty-seven plaintiffs. The particulars included each fernery’s previous growing history, when the various symptoms manifested, what injuries Benlate allegedly caused, and what damage could be attributed to other causes, as well as numerous other factors that uniquely impacted fern production at each individual fernery. This almost guaranteed juror confusion.  The common awards by the jury, in conjunction with the vast amount of disparate evidence presented at trial, demonstrate that the consolidation of the twenty-seven claims resulted in a hopelessly confused jury.

Importantly, the court also saw that by consolidating the claims, the plaintiffs introduced evidence to the jury that would not have been admissible had the cases been tried separately.  For example, in considering evidence on claims by plaintiffs who did not use Benlate after 1991, the jury was allowed to hear evidence of DuPont’s subsequent remedial measures, even though the measures were inadmissible as to those plaintiffs.

The court of appeals reversed the trial court’s final money judgments and amended final
money judgments rendered upon disposition of the parties’ post-trial motions and
remanded the cases to the trial court for new individual trials and for further proceedings
consistent with the opinion. The trial court was left free to choose to schedule either one fernery or one group of ferneries, under common management, as individual plaintiffs in separate trials.

JPML Hears Oral Argument In Gulf Oil Spill MDL

The U.S. Judicial Panel on Multidistrict Litigation heard oral argument last week on the issue of consolidating the hundreds of cases arising from the Gulf oil spill. In re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico,  MDL No. 2179.

The MDL panel met this time in Boise, Idaho, and suspended the usual rule limiting oral
argument to 20 minutes.  Multiple attorneys representing the various parties in the pending cases addressed the panel.  Most defendants urged the cases be coordinated in the Southern District of Texas, while most plaintiffs, including some of the restaurant owners and fishermen affected by the spill, argued for the Eastern District of Louisiana, asserting that much of the injury/damages is centered there. A  few other plaintiffs pushed for the cases to be coordinated in Mississippi, Alabama, or Florida courts.

BP argued that the Texas forum was appropriate because this defendant's headquarters, documents, and key fact witnesses are all located there. The government wants the cases consolidated in New Orleans. But one issue is that 8 federal judges, including several in Louisiana, have recused themselves from the spill cases.  This led to discussion whether potential judicial conflicts should compel the panel to bring in a judge from outside the Gulf states. In New Orleans, the Eastern District of Louisiana has consolidated its 50+ oil spill cases before Judge Carl J. Barbier, who has issued interim case management orders and appointed interim liaison counsel for plaintiffs and defendants.  Some have argued this has effectively created an administrative framework that could be utilized were the Panel to send the MDL to New Orleans.

At last look, federal cases were spread around the country, including in New York and California and Illinois.  However, the busiest oil spill dockets are in the Eastern District of Louisiana, Southern District of Texas, Southern District of Alabama, and the three Florida district courts, each with more than 10 cases. 

As noted here, the litigation involves a wide variety of claims, from personal injury, to property or environmental damages, lost profits, and securities-based economic injury.  The panel asked whether the cases, even if consolidated, should be put in separate groupings.  Some plaintiffs' attorneys  argued it was particularly important to set up a separate track for personal-injury claims.  

 

MDL Court Rejects Consolidation of Bellwether Trials

Readers of MassTortDefense know how significant the earliest few trials in any mass tort can be, influencing later trials and shaping settlement strategies.  Accordingly, which cases go first, from among the hundreds or thousands in the mass tort, and how they are tried, can be extremely significant.  The federal court overseeing the MDL concerning the antibiotic Levaquin recently denied plaintiffs' motion to consolidate three bellwether cases for the first trial. In re Levaquin Products Liability Litigation, MDL No. 08-1943, (D. Minn.). 

In the Order, the court noted that it had initially selected fifteen cases for evaluation and initial case-specific fact discovery in the bellwether-selection process. Directed by the court to meet and confer on an ordering of these cases for the first trials, the parties narrowed the field to seven remaining bellwether cases for selection for trial. Plaintiffs then moved to consolidate three of the cases for the first trial.  They asserted that the cases share similar characteristics that are central to this litigation and that consolidation would promote judicial efficiency and the interests of justice, while testing the merits of plaintiffs’ arguments. Defendants opposed the motion, arguing that plaintiffs had not met their burden of showing that a consolidated trial’s benefits would outweigh individual
issues in the case. Specifically, defendants argued that individual issues – including each
plaintiff’s unique medical history, each prescribing physician’s knowledge of warnings in the Levaquin package insert, and each plaintiff’s alleged injuries – precluded consolidation.

Federal Rule of Civil Procedure 42(a)(2) affords a court broad discretion to consolidate for trial actions involving common questions of law or fact. The party seeking consolidation bears the burden of showing that consolidation would promote judicial convenience and economy. Consolidation is inappropriate, however, if it leads to inefficiency, inconvenience, or unfair prejudice to a party.

Plaintiffs also argued that judicial economy would be served by consolidation because common sources of evidence established the supposedly common facts. For example, the same generic
expert witnesses would testify on behalf of each individual plaintiff, and the regulatory and
corporate history of the drug is the same for each plaintiff. Because of these alleged commonalities and claimed efficiencies, plaintiffs argued that consolidation of the three cases would save the court twenty trial days, not insignificant.
 
In opposition, defendants argued that individual issues, including what dose of Levaquin each physician prescribed to treat each plaintiff’s infection, and each individual plaintiff’s medical history, including their various risk factors for the injury alleged such as age, concomitant medication use including corticosteroids, prior injury, and other factors, all made consolidation inappropriate.

Moreover, defendants argued that consolidation would be prejudicial to them because there are complicated causation issues in each case, and multiple plaintiffs would testify regarding similar injuries, which could cause jury confusion. See In re Consol. Parlodel Litig., 182 F.R.D. 441, 447 (D.N.J. 1999) (“A consolidated trial . . . would compress critical evidence of specific causation and
marketing to a level which would deprive [the defendant] of a fair opportunity to defend itself.”).

At this stage of the MDL, the court concluded, consolidation was not merited. With respect to
the consolidation of cases, the Manual for Complex Litigation notes, “If there are few prior verdicts, judgments, or settlements, additional information may be needed to determine whether aggregation is appropriate. The need for such information may lead a judge to require a number of single-plaintiff, single-defendant trials, or other small trials.” Manual for Complex Litigation § 22.314, at 359 (4th ed. 2004). In the mass tort involving breast implants, the courts noted that that “[u]ntil enough trials have occurred so that the contours of various types of claims within the . . .
litigation are known, courts should proceed with extreme caution in consolidating claims.” In re Bristol-Myers Squibb Co., 975 S.W.2d 601, 603 (Tex. 1998).

To date, there are over 240 federal court cases in this MDL and just under 100 state court cases addressing claims similar to those brought by the bellwether plaintiffs. Indeed, this is a still growing MDL, found the court, the exact factual and legal contours of which are still undefined. The parties continue to conduct critical discovery, including deposing plaintiffs’ prescribing physicians. The merits of the parties’ arguments have not been tested at trial or in dispositive motions.

The court recognized that "the stakes are high" because the initial bellwether trials in this MDL may serve as the basis for the parties’ resolution of remaining, pending cases. Thus, although plaintiffs
appear to have demonstrated some commonalities in fact and law among the three
individual plaintiffs’ cases, this motion was denied at this time.