As many of you no doubt already know, the federal judiciary’s Committee on Rules of Practice & Procedure gave its final approval to new Fed. R. Civ. P. 16.1, concerning MDL practice, on June 4.  Here’s some commentary.  We’ve also mentioned the proposed rule here on the Blog.  Bexis went so far as to file an extensive comment on the proposed rule, primarily decrying the frequency with which MDL judges simply ignored the existing federal rules – most significantly (although hardly exclusively) those rules that act to weed out meritless claims in non-MDL situations.

Throughout the process that led to new Rule 16.1, the drafters consistently refused to impose any mandatory procedures at all for early vetting of the hordes of meritless to utterly frivolous claims that are routinely filed in mass tort MDLs.  Thus, we bloggers were skeptical that all the effort to create a new, entirely voluntary list of potential MDL management tools was worth the candle.  Indeed, new Rule 16.1 stands out like a sore thumb among the Federal Rules of Civil Procedure, precisely because it lacks any mandatory requirements.  The new rule has lots of “shoulds” but practically no “shalls.”  See Approved Committee Note and Text of Fed. R. Civ. P. 16.1.

Taking a closer look, we now believe that, if used according to its terms, new Rule 16.1 would actually be better than no rule at all, albeit not by a lot.  MDL cases now comprise over 70% of the total federal caseload, so we still believe it is ludicrous that those cases are not subject to a single mandatory MDL-specific rule.  But Rule 16.1 it is what it is.

To us, the key part of the rule is 16.1(b)(3), concerning “Additional Required Content” for the parties’ “report” that is to precede an “initial” MDL management conference.  That is the only place where the new rule purports to addresses the problem of meritless claims.

Additional Required Content: the Parties’ Initial Views on Various Matters.

Unless the court orders otherwise, the report also must address the parties’ 50 initial views on:

(A) whether consolidated pleadings should be prepared;

(B) how and when the parties will exchange information about the factual bases for their claims and defenses;

(C) discovery, including any difficult issues that may arise;

(D) any likely pretrial motions;

(E) whether the court should consider any measures to facilitate resolving some or all actions before the court;

(F) whether any matters should be referred to a magistrate judge or a master; and

(G) the principal factual and legal issues likely to be presented.

See the approved text.

Two of these seven items are not like the others.  Subpart (B) is not in any way conditional.  It anticipates “how and when” – not “if” − the parties “will exchange information about the factual bases of their claims.”  From our defense perspective, therefore, Subpart (B)  involves how quickly plaintiffs will have to “exchange” with defendants their “information” demonstrating that their claims have a “factual basis.”  All too many MDL courts indefinitely delay any individual plaintiff’s obligation (other than “bellwether” candidates) to provide this basic information.  Inclusion of Subpart B strongly indicates that such delay is not proper MDL practice.

Further, Subpart B’s anticipated “exchange” is not to be considered part of discovery.  “Discovery” is dealt with separately in Subpart C, the other mandatory topic for the pre-conference report.  All other 16.1(b)(3) topics are qualified, not mandatory; subject to modifiers like “whether” or “likely.”  As to these topics, it appears, “the report must address” at least these items.  Committee Note to Rule 16.1(b)(2).

Subpart B thus raises the question of what is an “exchange” of information, if not “discovery.”  We searched the existing federal rules for “exchange.”  That is how the commentary to existing Rule 26 describes required initial disclosures, Fed. R. Civ. P. 26(a)(1), added in 1993.  The Committee Notes consistently refer to the added “duty to disclose, without awaiting formal discovery requests, certain basic information” as an “exchange.”  Committee Note to Rule 26, 1993 Amendment:

• “The rule requires all parties (1) early in the case to exchange information regarding [specified topics]. . . .
• “A major purpose of the revision is to accelerate the exchange of basic information about the case. . . .
• “[T]he experience of . . . federal courts that have required pre-discovery exchange of core information such as is contemplated in Rule 26(a)(1) indicates that savings in time and expense can be achieved, particularly if the litigants meet and discuss the issues in the case as a predicate for this exchange and if a judge supports the process. . . .

(Emphasis added).

Rule 16.1 thus anticipates that MDL parties “will exchange” information establishing the “factual basis” of claims, and the existing federal rules, specifically Rule 26(a)(1), provide the framework for how such an “exchange” works in ordinary litigation.  The initial MDL management conference contemplated by Rule 16.1(a) is where the parties are required to work out the details of the anticipated “exchange.”  “Rule 16.1(a) recognizes that the transferee judge regularly schedules an initial management conference soon after the Judicial Panel transfer occurs.”  Committee Note to Rule 16.1(a).

But can plaintiffs and courts simply ignore Rule 26(a)(1) as a basis for the Rule 16.1 “exchange” of information, just like Bexis demonstrated in his comment that they have ignored so many other Federal Rules?  The commentary to Rule 16.1 addresses that as well.  The provisions of Rule 16.1(b)(3):

may also be employed in connection with pretrial motions, such as motions under Rule 12 or Rule 56.  The Rules of Civil Procedure, including the pleading rules, continue to apply in all MDL proceedings.

Committee Note to Rule 16.1(b)(3)(A) (emphasis added).  Bexis would like to think that his comment had something to do with the Committee deciding to include this reminder that the other federal rules still apply to MDLs.

Furthermore, the “exchange” of information contemplated in Rule 16.1(b)(3)(B) is part and parcel of counsel’s obligations under Fed. R. Civ. P. 11.  The “early exchange of information about the factual bases for claims and defenses” is one way to address “concerns [that] have been raised on both the plaintiff side and the defense side that some claims and defenses have been asserted without the inquiry called for by Rule 11(b).”  Committee Note to Rule 16.1(b)(3)(B).  That bit of false equivalence doesn’t change the new rule’s expectation  that this subsection “can be used early on when information is being exchanged between the parties.”  Id.  The key word is “early,” which the commentary uses repeatedly:

Early exchanges may depend on a number of factors. . . .  And the timing of these exchanges may depend on other factors, such as motions to dismiss or other early matters and their impact on the early exchange of information.  Other factors might include whether there are issues that should be addressed early in the proceeding. . . .

Id. (emphasis added).  “[T]he court may find it appropriate to employ expedited methods to resolve claims or defenses not supported after the required information exchange.”  Id.  That is early vetting, if − as Benjamin Franklin supposedly said – “you [defendants] can keep it.”

Defendants will have to work to keep early vetting in Rule 16.1, since the rule is, as discussed above, entirely without mandatory teeth, beyond requiring that early “exchange” of case information be addressed in the initial MDL conference.  Still, that – along with the reference to Rule 11 and the admonition that the general Rules of Civil Procedure apply to MDLs – is better than nothing.