For the first time in its 50-year history, multidistrict litigation (MDL) makes up more than 50 percent of the federal civil caseload. According to a recent assessment of statistical information released by the U.S. Judicial Panel on Multidistrict Litigation (JPML) by the Lawyers for Civil Justice (LCJ), MDLs accounted for 51.9 percent of all pending federal civil cases at the end of 2018. As reported, this is an increase of four percent from 2017. “When MDLs were created in 1968, nobody could have predicted that half a century later they would dominate our federal civil docket,” says LCJ Executive Director Andrea B. Looney in a press release.
Since the creation of the JPML in 1968, 673,104 civil actions have been centralized for pretrial proceedings. The percentage of civil cases in MDLs has more than tripled over the past 16 years. Of the 301,766 civil cases pending in the federal court system at the close of 2018, 156,511 were pending in 248 MDLs. According to the JPML, the top three MDL case types are products liability, antitrust, and sales practices. At the end of 2018, the JPML noted that these three categories made up 69.1 percent of the pending MDLs, with products liability constituting 32.9 percent, antitrust 24.1 percent, and sales practices 12.1 percent.
As a function of all cases in MDLs, 91 percent are products liability cases. Additionally, at the end of 2018, MDLs with 1,000 or more cases represented 46 percent of the pending federal civil cases. Moreover, there is significant concentration within MDLs, with just 12 percent of the MDLs containing nearly 90 percent of all pending MDL cases.
The MDL statute was enacted in April 1968 to authorize coordinated pretrial proceedings before a single judge, “[w]hen civil actions involving one or more common questions of fact are pending in different districts,” when “transfers for such proceedings will be for the convenience of parties and witnesses,” and when transfer “will promote the just and efficient conduct of such actions.” The statute was based on the federal judiciary’s experience in supervising nationwide discovery proceedings in electrical equipment cases pouring into the federal courts in the early 1960s.
Per the statute, the JPML consists of seven judges from district courts or courts of appeals. The JPML is chosen by the chief justice of the U.S. Supreme Court, and the first-ever panel was selected by Chief Justice Earl Warren. Ironically, the first MDL motion filed after President Lyndon Johnson signed the bill into law was denied. Following hearings in August 1968, however, the first MDL, In re Eisler Patents, was established.
Since that first MDL was created, MDLs have become the “preeminent forum for devising solutions to the most difficult problems in the federal courts,” writes David Noll, associate professor of law at Rutgers, in The Rule of Law in Multidistrict Litigation. According to Professor Noll, MDLs work “by refusing to follow a regular procedural playbook.” Prolific blogger James M. Beck notes on his site Drug & Device Law that “[t]here are no rules for MDLs” with the Federal Rules of Civil Procedure applying only sporadically, if at all. He expounds that the “current MDL system makes the federal judicial system resemble the baroque Holy Roman Empire—an agglomeration of hundreds of feudal principalities feigning allegiance to one set of laws, but in reality, operating more or less independently—with some of those margraves and palatine counts wielding rather despotic power.”
Professor Abbe Gluck of Yale Law School observes that MDLs “disrupt traditional legal relationships, turning judges and lawyers into collaborative partners in practical problem solving and creating a new judicial elite among the federal judges chosen to lead them.” To Professor Gluck, MDLs “exemplify procedural exceptionalism” and are “too different from case to case to be managed by the transsubstantive values that form the very soul of the Federal Rules.”
Because the rules of procedure were not created with MDLs in mind, it’s natural that updates are necessary. The centralization of so many individual cases before just a handful of federal district court judges means that a single trial court decision could impact hundreds or thousands of individual lawsuits. Criticism of the current situation is growing from both the plaintiff and defense bars.
For plaintiffs, it is argued that the lack of regular procedure allows lawyers to enrich themselves at the expense of plaintiffs for whom they perform “common benefit” work. For the defense, complaints are aimed at the ad hoc nature of tackling case organization, management, and approaches to settlement. In turn, the unstructured procedure, it is argued, encourages the filing of meritless claims as there is no formal process for eliminating baseless lawsuits at the beginning of an MDL.
Historically, the data shows that between 30 and 40 percent of all filed MDL cases are unsupportable. The issue is the lack of a mechanism to weed out meritless claims early. No analogue to Rule 23 class action certification exists in the MDL process. Moreover, procedural tools used in individual cases, such as motions to dismiss or for summary judgment, are more challenging for courts to address in MDLs because of the number of cases.
This predicament is worsened by the migration of the MDL process from a pretrial management tool toward an alternative dispute resolution medium setting the table for global settlements. In these instances, MDL plaintiffs might participate in resolutions without a court examining the merits of each case. Proposed solutions submitted to the Advisory Committee on Civil Rules include amending Rule 26 to require plaintiffs to make initial disclosures, using Lone Pine orders, and amending Rule 11 to sanction lawyers who file frivolous MDL cases.
Additional areas where the Federal Rules of Civil Procedure are argued as deficient for MDLs is with respect to appellate review and third-party litigation funding (TPLF). Concerning appellate review, it is argued that because a single dispositive ruling may apply to most cases in an MDL, timely appellate review is extremely important, could help to clarify fundamental issues in MDL proceedings, and would further the “just, speedy, and inexpensive” adjudication of these matters. Disclosure of TPLF in MDLs is also being advocated. TPLF is a multibillion-dollar industry in the U.S. and is increasingly being used to pay for MDLs.
Congress attempted reform when the House introduced the Fairness in Class Actions Litigation Act, which included a lengthy set of provisions aimed at MDLs. That bill, however, languished in the Senate. And although proposals for specific MDL rules were presented to the Advisory Committee, “[i]t may be difficult to convince the Advisory Committee to recommend uniform rules for MDLs because the very structure was designed to give judges great latitude to manage complex litigation,” according to Professor Alexandra Lahav of University of Connecticut Law School in a recent article. Lahav further states, “[t]he problem here is mass torts, not MDLs generally.” Alex Dahl, general counsel for the LCJ, disagrees. “The lack of rules gives judges too much latitude,” Dahl notes in a recent publication. According to the LCJ’s Looney, “[t]he fact that the federal judiciary is now majority MDL underscores the urgency of amending the FRCP. . . . Importantly, amendments to the Rules would benefit all cases, not just MDLs. The alternative is unfairness and unpredictability in over half of the civil justice system.”
