Duke’s Center for Judicial Studies hosted a conference on the future of multidistrict litigation (MDL) on May 2 and 3, in Washington D.C. Part of the center’s “Bench-Bar-Academy Distinguished Lawyers’ Series,” the event allowed more than 50 academics and attorneys to offer input to judges, transferee judges, and staff from the Judicial Panel on Multidistrict Jurisdiction (JPML) who are reviewing MDL processes and procedures.
Conference panelists and moderators included jurists from federal and state trial and appellate courts, as well as leading scholars and practitioners who specialize in MDL. Duke Law Professors Francis McGovernand Donald Beskind, and Dean David F. Levi, a former federal judge, participated in the event organized by John Rabiej, director of the Judicial Studies Center.
In a series of round table discussions, panelists and participants considered such matters as assignment of cases to MDL; the selection and location of MDL judges; selection of counsel; common benefit fund/attorney fees; remands; and coordination between federal and state courts. JPML executive Tommie Duncan and members of her staff briefed attendees on MDL filing trends.
Lawyers have been increasingly turning to the MDL procedure under 28 U.S.C. § 1407 to centralize numerous actions involving common claims, including mass torts, explained Rabiej. As a result, MDL’s are fast becoming the preferred method of disposing of large, aggregate actions involving common claims. Though MDL actions now comprise a large segment of the federal courts’ docket, only informal best practices and judicial training materials govern the procedures, he said. His report follows.
The conferees noted that a threshold issue was whether the primary purpose of MDL is to facilitate pretrial discovery proceedings or to reach settlement. The former emphasizes efficiency, while the latter emphasizes mediation and negotiation. The determination colors many decision-points, including selection of a transferee judge and the district. A second issue concerned the innovative practice adopted by some judges, who rely on their inherent authority to issue orders establishing a “common defense benefit” fund. Under this practice, the transferee judge calculates the discovery cost and assesses a percentage of it against every lawyer in the MDL action. In return, the lawyers obtain access to the pooled discovery. Though the practice is efficient, the judge’s authority to establish the common defense fund is not without doubt.
Participants identified another contentious area involving the transferee judge’s selection of lead counsel. The governing statute fails to provide any guidance to the judge on selection of lead counsel, even though such appointments are critical to the MDL action. In virtually all MDL actions, key factors that a judge must consider in selecting lead counsel are the competence and financial wherewithal to finance the litigation. Upfront plaintiffs’ costs can be enormous. Often, the number of lawyers who are both competent and financially able to manage a MDL is very small, resulting in repeat selections of particular lawyers and firms, which create an appearance of favoritism.
Perhaps the most contentious issue associated with an efficiently administered MDL case identified by the conferees is the effective coordination of proceedings between a federal transferee judge and state court judges. In some jurisdictions, the coordination problem is ameliorated to a certain extent by state laws, which centralize actions filed in that state. But absent such legislation, the federal judge must coordinate with numerous state judges handling individual actions. And even with the benefit of such state laws, the federal judge must deal with at least one state judge from each of the affected states.
A general consensus developed at the Duke Law conference was that the MDL’s procedures and processes are operating well – with one cautionary caveat. As lawyers resort more and more to MDL procedures, so too does the possibility of serious mistakes or errors in judgment in a regime that currently is regulated mainly by the discretion and good judgment of individual federal judges. In addition, because MDL’s affect such a large segment of the federal courts’ docket, as a matter of institutional prudence it was suggested that due attention should be given to initiating the rulemaking process under the Rules Enabling Act to provide definitive guidance and clarify areas of MDL procedure that remain unclear. Such an effort would require more study and data to determine the best practices and procedures and could be undertaken only in concert with the Judicial Panel on Multidistrict Litigation.