We read Michelle Yeary’s recent post about In re Fosamax Products Liability Litigation, ___ F.3d ___, 2017 WL 1075047 (3d Cir. March 22, 2017), with particular interest.  We were especially intrigued with the research demonstrating that the Fosamax court had departed from numerous prior Third Circuit precedents (including an en banc decision) on the question of preemption being a matter of law – as all the prior decisions had held – as opposed to a question of fact (the Fosamax result).

We note that the defendant in Fosamax shares the same view, and has itself sought en banc reconsideration.

Since Michelle cited over a dozen prior decisions, it’s highly likely that this issue will arise again. That raises the question (if the Fosamax opinion stands, which it shouldn’t) , what happens when precedential decisions of the Third Circuit are in conflict?  There certainly appears to be a direct conflict between the cases Michelle cited and the Fosamax decision.

We took a look.

In the Third Circuit, when two precedential opinions are in conflict, the earlier one – that is to say, in this instance, not Fosamax – controls.  This proposition was described in Pardini v. Allegheny Intermediate Unit, 524 F.3d 419 (3d Cir. 2008).  After referencing the same Third Circuit Internal Operating Procedure that Michelle did, Pardini held:

“This Circuit has long held that if its cases conflict, the earlier is the controlling authority and the latter is ineffective as precedents.”  United States v. Rivera, 365 F.3d 213, 213 (3d Cir. 2004); see also Holland v. New Jersey Dep’t of Corrections, 246 F.3d 267, 278 (3d Cir. 2001) (“[T]o the extent that [a case within the circuit] is read to be inconsistent with earlier case law, the earlier case law . . . controls”); O. Hommel Co. v. Ferro Corp., 659 F.2d 340, 354 (3d Cir. 1981) (“[A] panel of this court cannot overrule a prior panel precedent.  To the extent that [the later case] is inconsistent with [the earlier case, the later case] must be deemed without effect.”).

Id. at 426 (parenthetical and internal citations omitted).  As Pardini pointed out, this rule is the opposite of what happens when two statutes are irreconcilable.  Id.  But instead of the doctrine of implied repeal, the Third Circuit gives effect to its IOPs in a situation of precedential conflict – since the IOPs forbid what Fosamax sought to do, which was to ignore prior holdings of precedential Third Circuit opinions.

Pardini was followed in United States v. Joseph, 730 F.3d 336 (3d Cir. 2013), where later “statements suggesting otherwise” in Third Circuit opinions about waiver were ineffective to defeat prior precedent:

This suggestion, however, is in conflict with our earlier decisions . . . which we derive our holding [today].  Because these cases were decided earlier, the rule derived from them is controlling.

Id. at 341. Accord Goldman v. Citigroup Global Markets Inc., 834 F.3d 242, 252 (3d Cir. 2016) (a decision that “is contrary to our own prior precedent” “does not bind us on the question”); United States v. Tann, 577 F.3d 533, 541 (3d Cir. 2009) (“when our panel decisions conflict and our Court has not spoken en banc, however, the earlier decision is generally the controlling authority”); Kossler v. Crisanti, 564 F.3d 181, 194 n.8 (3d Cir. 2009) (“Even assuming arguendo that [the two opinions] are in unavoidable conflict, this Circuit has long held that if its cases conflict, the earlier is the controlling authority and the latter is ineffective as precedents”).

Indeed, we remember precisely this happening in connection with a Pennsylvania product liability issue a number of years ago. In Griggs v. BIC Corp., 981 F.2d 1429, 1433 n.6 (3d Cir. 1992), the court held that Pennsylvania did not use a “risk/utility” approach to the former (this law was all overruled in Tincher v. Omega-Flex, Inc., 104 A.3d 328 (Pa. 2014)) “threshold determination” of defect.  However, in Motter v. Everest & Jennings, Inc., 883 F.2d 1223 (3d Cir. 1989) – a case Griggs did not cite – a prior Third Circuit panel had held, “[u]nder Pennsylvania law, a trial judge must evaluate the risks of a product versus its social utility in determining whether the issue of the defective product is to be submitted to the jury.” Id. at 1227.  When confronted with both Griggs and Motter, a later Third Circuit panel resolved the conflict thusly:

to the extent that the panel’s decision [in Griggs] can be read as rejecting outright the use of a risk-utility analysis as a part of the threshold determination, it is contrary to our decision in Motter, supra, which . . . sanctioned this approach, and, therefore, carries no precedential weight.  See O. Hommel Co. v. Ferro, 659 F.2d 340, 354 (3d Cir. 1981) (“[A] panel of this court cannot overrule a prior panel precedent…. To the extent that [the later case] is inconsistent with [the earlier case, the later case] must be deemed without effect.”

Surace v. Caterpillar, Inc., 111 F.3d 1039, 1046 (3d Cir. 1997).

Thus, unless and until the determination in Fosamax that preemption is an issue of fact is confirmed by an en banc Third Circuit panel, or by an intervening decision of the United States Supreme Court, that determination should have no binding effect in future Third Circuit cases.  Third Circuit law is quite clear that where, as in Fosamax, a panel has made a ruling in conflict with prior Third Circuit decisions, the earlier decisions control.

But, as we’ve said before, strange things happen in tort preemption cases. We would have thought that the proposition that preemption was a legal question was supported equally clear precedent, but look at what happened in Fosamax.

The Louisiana Product Liability Act (“LPLA”) was enacted way back in 1988 – almost 30 years ago – to rein in the Louisiana courts’ product liability insanity (inanity?) epitomized by Halphen v. Johns-Manville Sales Corp., 484 So.2d 110 (La. 1986), which had allowed strict liability without defect under something called “unreasonably dangerous per se.”  “One of the legislature’s primary purposes in enacting the LPLA was to overrule Halphen.” Brown v. R.J. Reynolds Tobacco Co., 52 F.3d 524, 526 (5th Cir. 1995).  To accomplish this objective, the LPLA explicitly “establishes the exclusive theories of liability for manufacturers for damage caused by their products,” and under that statute a plaintiff “may not recover from a manufacturer for damage caused by a product on the basis of any theory of liability that is not set forth in [the LPLA].”  La. R.S. §9:2800.52.

Appellate courts applying Louisiana law have held that the legislature meant what it said. “The plaintiff’s case arises under the LPLA, which provides the exclusive theories under which a plaintiff can pursue a claim against a manufacturer for an alleged product defect.” Reynolds v. Bordelon, 172 So. 3d 607, 612 (La. 2015).  “[T]he LPLA is the exclusive remedy against manufacturers for damages resulting from a defective product.”  Aucoin v. Southern Quality Homes, LLC, 984 So. 2d 685, 691 n.8 (La. 2008) (noting exception for the peculiar doctrine of redhibition; see our post about redhibition here).  A “plaintiff’s exclusive remedy against [a manufacturer] sounds in products liability as governed by the Louisiana Products Liability Act.”  Payne v. Gardner, 56 So. 3d 229, 231 (La 2011). Accord Johnson v. Teva Pharmaceuticals USA, Inc., 758 F.3d 605, 616 (5th Cir. 2014) (“the LPLA provides [plaintiff’s] exclusive remedy”); Demahy v. Schwarz Pharma, Inc., 702 F.3d 177, 182 (5th Cir. 2012) (LPLA “provides that it is the exclusive remedy for products liability suits”); Jefferson v. Lead Industries Ass’n, Inc., 106 F.3d 1245, 1248 (5th Cir. 1997) (“Louisiana law eschews all theories of recovery in this case except those explicitly set forth in the LPLA”); Haley v. Wellington Specialty Insurance Co., 4 So. 3d 307, 311 (La. App. 2009) (“[t]he LPLA establishes the exclusive theories of liability for manufacturers for damages caused by their products”); Jenkins v. International Paper Co., 945 So. 2d 144, 147 (La. App. 2006) (“[t]he exclusive theories of liability for manufacturers for damages caused by their products are set forth in the . . . LPLA”); Slaid v. Evergreen Indemnity, Ltd., 745 So. 2d 793, 797 (La. App. 1999) (LPLA “establishes the exclusive theories of liability for manufacturers for damages caused by their products”); Ashley v. General Motors Corp., 666 So. 2d 1320, 1321-22 (La. App. 1996) (“[a] claimant may not recover from a manufacturer for damages caused by a product on the basis of any theory of recovery not set forth in the Act”).

Thus, “neither negligence, strict liability, nor breach of express warranty is any longer viable as an independent theory of recovery against a manufacturer.”  Jefferson, 106 F.3d at 1251.  “[A]llegations of negligence, fraud by misrepresentation, market share liability, breach of implied warranty of fitness and civil conspiracy fail to state a claim . . . under the LPLA.”  Id. at 1252.  Similarly, “both federal and Louisiana courts have read the Act’s exclusive remedy provision to prevent plaintiffs from bringing intentional tort claims.” Stahl v. Novartis Pharmaceuticals Corp., 283 F.3d 254, 262 (5th Cir. 2002) (citations omitted).

The LPLA applies to all Louisiana product liability cases that accrue after the act’s effective date of September 1, 1988.  Gilboy v. American Tobacco Co., 582 So.2d 1263, 1264 (La. 1991); Brown, 52 F.3d at 530.  Like we mentioned above, that’s almost thirty years ago.

Yet, time after time, we see Louisiana plaintiffs filing – and courts dismissing – complaints chock full of non-LPLA common-law “causes of action” which since 1988 have had no possible legal validity.  E.g., Donald v. AstraZeneca Pharmaceuticals LP, 2017 WL 1079186, at *1-2 (E.D. La. March 22, 2017); Pramann v. Janssen Pharmaceuticals, 2017 WL 58469, at *2 (E.D. La. Jan. 5, 2017); Guidry v. Janssen Pharmaceuticals, Inc., 2016 WL 633673, at *3 (E.D. La. Feb. 17, 2016); Lyles v. Medtronic, Inc., 2016 WL 247584, at *3-4 (W.D. La. Jan. 20, 2016); Toups v. Synthes, Inc., 2015 WL 6738541, at *4-5 (E.D. La. Nov. 4, 2015); Hargrove v. Boston Scientific Corp., 2014 WL 4794763, at *14 (E.D. La. Sept. 24, 2014); Audrict v. Depuy Orthopaedics, Inc., 2014 WL 906562, at *1-2 (E.D. La. March 7, 2014); Corley v. Stryker Corp., 2014 WL 783066, at *1-2 (W.D. La. Feb. 25, 2014); Scianneaux v. St. Jude Medical, S.C., 961 F. Supp.2d 808, 811 (E.D. La. 2013); Gavin v. Medtronic, Inc., 2013 WL 3791612, at *15-16 (E.D. La. July 19, 2013); Aucoin v. Amneal Pharmaceuticals, LLC, 2012 WL 2990697, at *5 (E.D. La. July 20, 2012); Cooper v. Wyeth, Inc., 2010 WL 2653321, at *2 (M.D. La. June 25, 2010); Lewis v. Pfizer Pharmaceutical Co., 2010 WL 2545195, at *2 (W.D. La. June 18, 2010).  These are just the prescription medical product cases since 2010 – we have to believe that many more similar Louisiana cases exist involving other products.

Through ignorance, sloth, or just plain cussedness, plaintiffs’ lawyers in Louisiana have persisted for decades in bringing claims that have no pretense of viability under controlling state law represented by the LPLA. Isn’t it time for Rule 11?

Federal Rule of Civil Procedure 11 provides, in pertinent part, that sanctions are available when:

the claims . . . are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law.

Fed. R. Civ. P. 11(b)(2).  “[M]onetary sanctions can be imposed against the attorney but not the client for violations of Rule 11(b)(2).”  Skidmore Energy, Inc. v. KPMG, 455 F.3d 564, 568 n.8 (5th Cir. 2006) (citation and quotation marks omitted).  The “obligation [under Rule 11(b)(2)] must be satisfied; [its] violation . . . justifies sanctions.”  Whitehead v. Food Max of Mississippi, Inc., 332 F.3d 796, 802 (5th Cir. 2003) (en banc).  “[I]n determining compliance . . ., the standard under which an attorney is measured is an objective, not subjective, standard of reasonableness under the circumstances.”  Id. (citation and quotation marks omitted).  “[P]laintiffs violate[] Rule 11(b)(2)” when they “fil[e] complaints replete with obviously deficient claims.”  Marceaux v. Lafayette City-Parrish Consolidated Gov’t, 614 F. Appx. 705, 709 (5th Cir. 2015).

With respect to the LPLA’s statutory extinguishment of common-law causes of action, as developed above, the law is crystal clear and uniform appellate authority that common-law claims of whatever type (except redhibition) are barred stretches back decades. The statute is plain on its face, thus the “legal issues are not that complex.”  Marceaux v. Lafayette City-Parrish Consolidated Gov’t, 14 F. Supp. 3d 760, 771 (W.D. La. 2014), aff’d, 614 F. Appx. 705 (5th Cir. 2015).

To us it seems like the other side’s persistence in filing facially LPLA-barred common-law causes of action in Louisiana product liability cases is an open and shut case for Rule 11 sanctions.  Defense counsel would, of course, have to comply with the pre-filing and safe harbor provisions of Rule 11(c), so plaintiffs could withdraw those claims within 21 days, and the defendant would recover nothing.  However, using the case-law cited in this post, preparing an almost boiler-plate motion based on LPLA exclusivity (needing only party names, paragraph numbers, and the pertinent common-law claims to be filled in individually) should not be very costly – and once drafted, the motion could be used repeatedly to force dismissal of the barred claims, thus saving the expense of individualized motions to dismiss.

We DDL bloggers are happy to offer the Louisiana defense bar these tools to put an end to plaintiffs’ routine violation of the LPLA.

 

Most of the cases we defend involve claims of inadequate warnings.  What makes a warning inadequate?  Falsehood is the first thing that comes to mind.  But the Pontius Pilate question of “What is truth?” continues to vex.  We have seen very few drug or device labels uttering an affirmative misrepresentation.  More often the complaint is about what the warning did not say, not what it did say.  If John Lennon sang “Gimme Some Truth,” plaintiff lawyers sing (off-key) “gimme some more truth.”  To our ears, it sounds like “gimme some more money.”  Whatever.  Plaintiffs allege that the product label did not disclose all of the serious side effects, or did not recite them with sufficient detail and drama.  There is a hierarchy of warning inadequacy.  A warning can ‘fail’ for any of various reasons.  You pays your money and you takes your choice.  Did the warning:

  • Fail to grab attention?
  • Fail to persuade?
  • Fail to change action?

The last test is a slam dunk.  If the consumer heeded the warning, we wouldn’t be enjoying each other’s company in the courtroom.  There would be no complaint.  Probably.

The first warnings we remember seeing were on cigarette packs.  The United States was the first country to require such warnings.  Back in 1966, the sides of cigarette packs were adorned with the following: “Caution:  Cigarette smoking may be hazardous to your health.”  That warning did not include the word “warning.”  Change came a couple of years later.  In 1970, packs reminded us that the Surgeon General had determined that cigarettes were “dangerous.”  Still later, smokers were treated to rotating warnings.  Some packs warned of cancer, emphysema, heart disease, and pregnancy complications.  Some stated that cigarette smoke contains carbon monoxide.  Some suggested that quitting now could improve one’s health.  And some warned pregnant smokers of possible fetal injury, premature birth, and low birth weight.  We heard that one fellow filed a lawsuit alleging that cigarettes had caused his lung cancer, while also claiming he had not been adequately warned, because he had made a point of buying only the packs that talked about pregnancy complications.  That case proved at least two things:  (a) no matter what, some people will smoke, and (b) no matter what, some people will file silly lawsuits.

Continue Reading Warning: Lawyers May Be Hazardous To Your Health

It is bad enough that the mass tort system in our country approximates a system of jackpot justice that, if it ever does justice among the parties, does so accidentally. But its wild inefficiencies and inconsistencies also have macro adverse effects on things like consumer choice and the overall healthcare system.

A recent law review article offers further support for our scurvy view of mass torts by explaining how the long, inglorious history of lawsuits against contraceptives has hurt consumers and society. The article is by Eric Lindenfeld, is entitled “The Unintended Pregnancy Crisis: A No-Fault Fix,” and it appears in the Spring 2016 issue of the Marquette Benefits & Social Welfare Law Review.

The article begins by outlining the unintended pregnancy crisis, which is caused at least in part by dissatisfaction with current methods of contraceptives. The article argues that the less-than-robust portfolio of available contraceptives is attributable to a stagnant research and development milieu for new contraceptives. That stagnant milieu is attributable, in turn, to the frenzy of mass torts against contraceptives. The article recites the history of litigation against the birth control pill, Dalkon Shield, Norplant, as well as more recent litigations, such Yaz/Yasmin, Mirena, and Essure. Not all of those litigations were particularly successful for plaintiffs. Not all possessed any merit. For example, the article cites evidence that Norplant turned out to be safe and efficacious – but the expense of the litigation and the enormous adverse publicity drove the product from the market. The real losers were consumers.

Continue Reading Law Review Article Argues that Contraception Mass Torts Injured Consumers

A lot of companies rely on retired and otherwise former employees for information in litigation – including product liability litigation. Particularly where a product (such as a drug that’s now gone generic) has a long history, they are often the best source of knowledge about what happened years ago.  In dealing with ex-employees, however, defendants must keep in mind that, for purposes of the attorney/client privilege, discussions with ex-employees are subject to being treated much differently (and less protectively) than corporate communications with current employees.

The recent case, Newman v. Highland School District No. 203, 381 P.3d 1188 (Wash. 2016), although not involving prescription medical products, or even product liability, is a cautionary tale.  The defendant in Newman was a governmental entity, a school district.  The plaintiff alleged that he suffered a brain injury playing high school football, and that the injury occurred because the plaintiff was allegedly allowed to play in a game the day after suffering a concussion in practice.

The plaintiff in Newman didn’t sue until some three years after the injury. Id. at 1189-90.  By then, most of the coaching staff had turned over, and the individuals with the best knowledge of what had happened were employed elsewhere.  The school district’s litigation counsel contacted the ex-coaches and when they were deposed, claimed to represent them.  Id. at 1190.  Plaintiff challenged that representation as a conflict of interest and “sought discovery concerning communications between [the defendant] and the former coaches.”  Id.  The defendant resisted discovery with a claim of attorney/client privilege, and plaintiff opposed.  The defendant lost, and appealed denial of its motion for a protective order.  Id.

Continue Reading A Reminder To Be Careful With Ex-Employees And Confidential Information

We’re pleased to report the demise of a plaintiff’s firm’s attempt to punish the FDA for rejecting the firm’s attempt to force the agency to create evidence helpful to plaintiffs in litigation. The ploy began in 2012, when “a law firm that represents hundreds” of plaintiffs in prescription drug mass tort litigation “on a contingency fee basis” “filed a citizen petition with the [FDA].”  Sheller, P.C. v. U.S. Dep’t of HHS, 119 F. Supp.3d 364, 368 (E.D. Pa. 2015). Plaintiff sought agency action that it could, in turn, parade before juries in the underlying mass tort, specifically: “that the FDA immediately revoke the [relevant] indication for the . . . [d]rugs” at issue or alternatively “require that labeling for those drugs include a black box warning based on the lack of sufficient data to prove their safety.”  Id.  In addition, the plaintiff law firm sought to enlist the FDA in evading a confidentiality order (originally agreed to by the law firm) that protected discovery which the defendant in the underlying litigation had provided.  Id.

So far, so what?  While annoying, attempts of this nature to embroil the FDA in mass tort prescription medical product litigation are part of the other side’s play book.  (((Bexis))) recalls similar machinations during the Bone Screw litigation whereby the plaintiffs did everything they could (ultimately unsuccessfully) to prevent the Agency from adding to those products’ labeling previously off-label uses that had become the medical standard of care – because the Bone Screw plaintiffs’ litigation strategy was based on the procedures in question being off label.

The Bone Screw plaintiffs failed, 63 Fed. Reg. 40025-41 (FDA Jul. 27, 1998) – as did the law firm plaintiff in Sheller (119 F. Supp.3d at 368) – since the FDA normally has little patience for the junk science that the other side routinely peddles in mass tort litigation.  The plaintiff law firm in Sheller would have been off not filing the petition at all, since according to plaintiff, “the FDA decision to deny its petition “has been used as the basis to assert federal preemption and other [defense] arguments against [plaintiff’s] clients in [mass-tort] litigation.”  Id.

No kidding.  That’s the down side this sort of litigation strategy.  Attempts to involve the FDA in litigation have the risk that, if one loses, the FDA’s actions can create a positive narrative for the other side.

But plaintiffs believe in the doctrine of “heads I win; tails you lose.”

So in Sheller the plaintiff law firm attempted to gin up, from their failed strategy, a tort cause of action – not an administrative claim – against the FDA.  Talk about a bootstrap.  The plaintiff law firm was the one that involved the FDA in the first place.  The bizarre theory of liability postulated that, if the FDA wouldn’t cooperate in creating pro-plaintiff evidence/themes in the underlying litigation, that required the plaintiff law firm to work harder and spend more money to come up with something that juries might believe.  So the law firm sued the FDA to recover its purportedly increased litigation costs:

Plaintiff [claims] . . . that the FDA denial of [its] citizen petition increased [its] costs in litigating [because] . . . the defendant . . . has argued that the FDA’s denial of the Petition proves, as a matter of law, that the [drug’s] label is adequate. . . . Plaintiff argues that it must continue to expend resources in defending against that argument, and it faces the risk that a Court will accept it, lowering [plaintiff’s] contingent fee recovery.

Sheller, 119 F. Supp.3d at 369-70 (quotation marks omitted).

Continue Reading Bootstrapped Claim Against the FDA Gets the Boot

Today we have a guest post from Reed Smith‘s Jaclyn Setili, about one of our pet peeves – MDL plaintiffs (and their counsel) who think they don’t have to do any work at all on their cases, and simply show up come settlement time with their hands out.  In this instance, they received a much deserved comeuppance.  As is the case with all our guest posts, Jaclyn deserves all the credit for what follows, as well as any blame.

**************

At last, friends, it’s that time of year again. Time to dust off the sweater vest, memorize your favorite college football team’s schedule (Go Blue), and indulge in the ubiquitous pumpkin-spice-flavored everything.  In fact, just the other day as we were jogging along the Schuylkill River Trail, after an oppressively hot and humid summer, we glimpsed the first few yellow leaves of the year as they gently, and gracefully, made their journey to the asphalt, and our heart leapt with joy and relief.

Unlike spring, however, autumn is not a time for fresh hope or new beginnings.  Rather, the season reminds us of the inescapable promise that another year is nearing its eventual terminus.  A recent opinion from the Southern District of Florida, In re Denture Cream Products Liability Litigation, — F. Supp.2d —-, 2016 WL 4582185 (S.D. Fla. Aug. 31, 2016), encapsulates that idea:  the fundamental truth that every summer—like every lawsuit—must come to an end.  Winter, friends, is always coming.

In re Denture Cream is another order from the denture cream MDL, which we have covered on several prior occasions, i.e. here and here.  To remind you, the JPML consolidated multiple cases in MDL 2051 on September 12, 2011, finding that they all shared common questions of fact concerning allegations that the level of zinc found in certain brands of denture cream may cause copper deficiencies and neurological injuries.  The opinion we discuss today, however, involves a frequent bane of MDL defendants – the plaintiffs who try to lie back, hide in the weeds, do as little as possible, and share in an eventual settlement.  This time, it didn’t work out so well for those plaintiffs.

Continue Reading Guest Post – With No General Causation Experts, Denture Cream Plaintiffs Drop Like Leaves In Autumn

An article forthcoming in the California Law Review has been posted on SSRN and is worth reading:  Bradt & Rave, “The Information-Forcing Role of the Judge in Multidistrict Litigation.”   The authors describe how MDL proceedings have come to dominate the federal civil docket – making up nearly half the caseload.  MDLs have to some extent supplanted class actions, while sharing some of the principal-agent problems that plague class actions.  The authors insist that the most serious problem is that the plaintiff lawyers making many of the key decisions in an MDL (usually adorned with the regal title of “the plaintiff steering committee”) do not represent all the plaintiffs.  That problem rears its head in a particularly ugly fashion when it comes to settlements.  Individuals get treated as an aggregate and some make out better than others for no reason grounded in rationality or fairness.  It can hardly arrive as news that plaintiff lawyers might steer more dollars toward their cases than others.  But while a class action judge has a well-defined role/duty to approve or disapprove class action settlements, MDL judges lack such authority.  The authors are distressed by this state of play, because, in their view, MDLs are built for settlement:  “The MDL statute was developed as a judge-centric model – its framers intended that judges would wrest control of cases from the litigants and guide the litigation to a conclusion that would relieve the federal courts of potentially crushing caseloads.”

What’s the solution to the principal-agent dilemma in MDLs?  The authors point with favor to the judge in the World Trade Center Disaster Site Litigation who expressed the view that a proposed settlement was not enough.  That judge, according to the authors, based his authority to reject the settlement on a quasi-class action theory created by Judge Weinstein the Zyprexa MDL.  The WTC judge acted as an ‘information intermediary.”  Once he put it out there that the settlement was, by his lights, unfair, it was not possible to cram down the settlement when most of the plaintiffs would have heard what the judge said.  Bradt & Rave argue that this information intermediary role is an important one for MDL judges, because the MDL lawyers are not reliable sources of information.  It is hard to argue with that last point.

But how reliable are judges?  To the authors’ credit, they acknowledge points made by other scholars questioning the quasi-class action model.  Many (most? all?) judges have a strong interest in settling cases.  The danger of that predilection is, according to the authors, that judges might approve settlements that are unfair to some plaintiffs.  That’s true as far as it goes.  Nevertheless, there is another unfairness danger, and it  does not seem to bother the authors much or at all:  judges in some aggregated proceedings do their utmost to strong-arm settlements that are unfair to defendants.  In the conclusion of the article, the authors tell us that “Settlement is good.”  That’s sort of a Mom and apple pie sentiment, isn’t it?  Yes, there is a Lincoln quote out here somewhere praising the concept of settling litigation.  Fine.  We know we’ll get a reaction as if we passed gas in church when we say this, but, hey, Not All Settlements are Good.  Some are neatly wrapped packages of extortion.   A sentence or two later, the authors write that “the beauty of MDL is that, by gathering all of the players into a single forum under the watchful eye of a coordinating judge with substantial flexibility, it creates a fertile environment to facilitate a comprehensive resolution.”  Fertile, indeed.  There is a lot of fertilizer in that field. Most of the cases in any MDL inventory are meritless – plaintiffs who suffered no injury, or suffered the injury before they used the product, or never used the product at all.  And yet far too many MDL judges act as if any defendant who does not gallop over to the plaintiff steering committee with a settlement offer, a grid, and an open checkbook needs a spanking.  We have seen judges rule against defense motions, or fail to rule at all, as a way of punishing defendants who seem insufficiently eager to settle.  Even more commonly, when a judge wants to inspire defendants to settle, the judge will order absurd trial schedules, often with cases consolidating plaintiffs so as to maximize prejudice and the specter of huge verdicts.  Information forcing?  Call it what it really is: settlement forcing.

Continue Reading MDL Judges: Information-Forcing or Settlement Forcing?

This weekend, the Drug and Device Law Rock Climber hosted a sleepover to say goodbye to her friends as she headed back to college. Somehow, between our last survey of heads on pillows and the convergence on the breakfast table, the number of non-resident young adults increased, prompting the logical question (as we cracked a few more eggs), “How did you guys get here?”

In In re Mortgage Electronic Registration Systems (MERS) Litigation, 2016 WL 3931820 (D. Ariz. July 21, 2016), the United States District Court for the District of Arizona asked a similar question.  This is obviously not a drug or device case, but it is relevant to all of us who defend clients in MDLs. In MERS, cases related to the formation and operation of the subject mortgage registration systems were consolidated in an MDL.  After the court dismissed a number of associated cases, the plaintiffs filed a Consolidated Amended Complaint (“CAC”). One of the named plaintiffs in the CAC had not been named in the previous complaint and “had never filed a lawsuit that the Judicial Panel on Multidistrict Litigation transferred to [the court].” MERS, 2016 WL 3931820 at *1.

A complicated procedural sequence ensued. The district court dismissed the CAC for failure to state a claim upon which relief could be granted.  In its discussion of its dismissal of Count I of the CAC, the court stated, “[The new] alleged Plaintiff . . . is not a named Plaintiff in any member case of this MDL.  Accordingly, Plaintiffs’ claim cannot rest on allegations relating to [this plaintiff].”  Id. at *1.  The Ninth Circuit affirmed the dismissal of the CAC except that it reversed and remanded as to Count I.  And so, the parties ended up back before the MDL court, where the defendants moved for summary judgment on the new plaintiff’s claims.  The defendants argued, “[This plaintiff] never filed a lawsuit that the [JPML] transferred to this Court.  Rather, [he] was joined when Plaintiffs filed their Consolidated Master Complaint – which is impermissible – and thus, this Court’s jurisdiction has not been invoked.” Id. at *2 (citations omitted).  In the alternative, the defendants asked that the new plaintiff’s claims be dismissed for lack of jurisdiction.

The court requested supplemental briefing on the following questions: 1) Does a transferee MDL court have the authority to join ‘new’ plaintiffs in an MDL when such plaintiffs never filed their own case (nor paid the filing fee) and never had their cases transferred to this Court by the panel on multidistrict litigation; and 2) what was the basis for federal subject matter jurisdiction over the new plaintiff’s case. Id. In their supplemental brief, the plaintiffs argued that the new plaintiff’s case was properly joined in the MDL because, like other plaintiffs, the defendants were allegedly involved in recording false documents related to the new plaintiff’s property.  Plaintiffs also argued that the court had diversity jurisdiction over the new plaintiff’s claims.  The defendants countered, “The jurisdictional issue relating to [the new plaintiff] does not involve whether there was diversity jurisdiction or federal question jurisdiction relating to [his] claims.  Rather, the issue is whether the Court’s jurisdiction is sufficiently invoked because [the new plaintiff] never filed a lawsuit in this federal court or in any other federal court that was then transferred to the MDL Court by the [JPML].” Id. at *3.

Continue Reading MDL Court Says “You Don’t Belong Here” to Plaintiff “Added by Amendment”

This is our vacation week, so it’s time once again to play the game of “Where in the World is Stevie Mac?”  Last year, we wanted to visit a place with nice sights, great beer, and, most of all, zero chance of terrorism.  We chose Belgium.  Let that sink in for a moment.  This year should be easier.  The animating factors in 2016 — fear of jet-lag, fear of poverty, and, yet again, fear of terrorism – conspired to keep us fear-ly close to home.  Enjoy these hints:

  • Hello misnomer!
  • It never ratified the 18th amendment (prohibition – so, yes, this is our kind of place).
  • There is a specific law against biting off someone’s leg.  (The legislators here have obviously gotten a little too into The Walking Dead.)
  • The first American ever jailed for driving his car too fast earned that distinction by going a rip-roaring 15 mph here in 1904.
  • Cap guns are illegal in this state.
  • You will be fined if you throw pickle juice on a public trolley.  That rule will frustrate the DDL Son to no end.
  • Finally, our all-time favorite basketball player, Marvin Barnes, hailed from these parts.   Barnes (nicknamed “Bad News”) was part of a gang of high schoolers arrested for robbing a bus.  The victim had no trouble identifying Barnes, who had been wearing a letter jacket with his name embroidered on it.  That brush with the law did not stop Bad News (later shortened to “News”) from having a remarkable hoops career.  Barnes began his professional career with the ABA’s St. Louis Spirits.  Once upon a time, his team was scheduled to fly home from Louisville at 8 o’clock.  Because of the East-to-Central time zone change, the flight was scheduled to arrive in St. Louis at 7:56.  Barnes refused to board the flight.  In his immortal words, “I ain’t getting on no time machine.”  Instead, he rented a car and drove home.  Sadly, Barnes died way too young (62) a couple of years ago.  Let’s pour out a little White Ship Lovecraft IPA in his honor this week.

Continue Reading DDL Summer Vacation: Another Sequel