That concept does not feel like it should be controversial in any way. Afterall, at the heart of class action tolling of the statute of limitations, as announced in American Pipe & Construction Co. v. Utah, 414 U.S. 538 (1974), is there must be a pending class action. But the concept gets a little muddy in the mass tort context, which is why we’ve previously argued for an MDL exception to American Pipe. Today’s case is a clear example of why.
First, some background on American Pipe. The Supreme Court held that “the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action.” Id. at 554. The Court’s reasoning was based on efficiency and economy. It was trying to avoid unnecessary filings by absent class members while simultaneously protecting those class members. The tolling runs while the “class” portion of the suit is pending. So, if class certification is denied or if the class claims are dismissed, American Pipe tolling ends.
But what happens when a putative class action gets transferred into an MDL and abandoned by the plaintiffs who filed it? That was the issue facing the First Circuit in MSP Recovery Claims, Series LLC v. Fresenius Med. Care Holdings, Inc., — F.4th –, 2025 U.S. App. LEXIS 6243 (1st Cir. Mar. 17, 2025). Now a procedural rundown, which is always important in American Pipe tolling cases: (1) in 2012, defendants publicly announced that its drug used in hemodialysis could lead to cardiopulmonary arrest in certain patients; (2) in 2013, a group of nine plaintiffs filed a nationwide products liability class action; (3) the putative class action, along with individual claims, were transferred to the District of Massachusetts as part of an MDL; (4) plaintiffs filed a master complaint in the MDL that did not contain any class allegations; (5) in February 2014, the MDL court entered a case management order directing each plaintiff to file a short form complaint that would “incorporate the Master Complaint and replace that party’s original complaint”; (6) between March and June 2014, four of the plaintiffs to the putative class action voluntarily dismissed their claims and the other five filed short form complaints on behalf of themselves or next of kin only that did not contain any class allegations; (7) on September 6, 2018 MSP files its class action complaint; (8) following a private global settlement the 2013 class action was closed in April 2019. Id. at *4-5.
There was no dispute that under any state’s law, MSP’s claims were time barred unless saved by American Pipe tolling. It was also undisputed that as of June 2014, the MDL court no longer had before it any class action claims. But here is the muddy part. The MDL court in a later proceeding inquired about whether the 2013 class action was still “hanging out there.” Id. at *5. The plaintiffs’ leadership responded that counsel was:
not planning on moving for certification, and that these cases were filed, for the most part, with respect to the issue of equitable tolling for the purposes of the limitations period, and for now our preference is to just leave them as they are.
Id. at *5-6. And that is exactly what happened for five years. The class action sat. No plaintiff took any action to move the class claims forward and never sought class certification. Yet, MSP argued that the statute of limitations was tolled until the class complaint was finally dismissed in 2019. Defendant argued that the earlier case lost is “class character” at the latest in June 2014 and that is when tolling ended—more than four years before MSP filed its complaint. The court agreed with defendant.
MDL plaintiffs may elect to file a master complaint. If they do, the “master complaint supersede[s] prior individual pleadings.” Id. at *12. Therefore, when the original class plaintiffs filed individual short form complaints, those new complaints replaced the class action which became inoperative. Further, the short form complaints adopted the master complaint which also did not contain any class allegations. Id. at *13.
While that should have ended the inquiry, the appellate court acknowledged the complexities of MDL litigation and was unwilling to ignore that the MDL court did not consider the request for class certification “entirely abandoned” but rather “held in a form of abeyance, not because plaintiffs were actually pursuing class certification, but as a tool for tolling the statute of limitations.” Id. at *14 (emphasis added). So, the court considered the question before it to be whether an otherwise-abandoned request for class certification held in limbo for the sole purpose of tolling the statute of limitations did in fact have such a tolling effect. The answer was no:
To allow such a gambit to substitute for pleading and actively pursuing a class action would run contrary to the aims of American Pipe, the “watchwords” of which are “efficiency and economy of litigation.” Neither efficiency nor economy is furthered by holding a request for certification on inactive life support simply to delay indefinitely the need to bring forward individual claims.
Id. at *17 (citation omitted).