As one experienced MDL judge has written, direct filing can be a useful tool in MDLs because it “eliminates the judicial inefficiency that results from two separate clerk’s offices having to docket and maintain the same case and three separate courts (the transferor court, the MDL Panel, and the transferee court) having to preside over the same matter.” Hon. Eldon E. Fallon et al., “Bellwether Trials in Multidistrict Litigation,” 82 Tul. L. Rev. 2323, 2356 (2008). Although the practice has been questioned by some courts and commentators (including some who question whether there is any jurisdictional basis for the practice absent consent), direct filing is now increasingly common in MDLs and typically implemented through a case management order (CMO). Examples are given in the appendix at the end of this article.
Direct filing can raise a host of issues concerning personal jurisdiction, venue, and choice of law. A threshold issue, however, is whether consent from all parties is needed to implement direct filing. Direct filing CMOs are frequently stipulated. As a consequence, opinions discussing direct filing orders often refer only to what the parties have agreed (or should have addressed in their stipulation). But at least one MDL court recently clarified that direct filing can be ordered regardless of whether all parties consent.
In In re MultiPlan Health Insurance Provider Litigation, No. 1:24-cv-06795 (N.D. Ill.) (MDL No. 3121), the direct action plaintiffs proposed direct filing to streamline the process of coordinating complaints being brought by healthcare providers throughout the country. While direct filing is common in mass tort MDLs, the MultiPlan MDL presented a somewhat unusual context because the providers are suing the defendants for violations of federal and state antitrust laws. Certain defendants also raised the potential for early motions to compel arbitration.
The potential sticking point was consent. The defendants took the position that direct filing could not be implemented without their consent, relying principally on the Seventh Circuit’s decision in Looper v. Cook Inc., 20 F.4th 387, 391 (7th Cir. 2021). In Looper, the parties had consented to direct filing in practice, but there was no direct filing CMO. Id. at 398. As a consequence, there was no stipulation or CMO that clearly addressed the critical issue of how (if at all) a direct filing would affect choice-of-law questions for any individual plaintiff’s claims. Id. at 394. Based on a thorough review of the record, the Seventh Circuit found that the defendant had impliedly, but “clearly,” “consented to the application of originating state choice-of-law rules to directly filed cases.” Id.
The Looper opinion went on, however, to provide guidance for avoiding such thorny issues. The court advised that, “for future reference we urge transferee judges to use written orders to ensure clear consent from parties about how they will manage choice-of-law, personal jurisdiction, and venue issues in directly filed cases,” so that “[t]he court . . . secures consent for parties to file in the MDL forum, opening a second door for new filings and creating judicial efficiencies in the process without creating new uncertainties and disputes.” Id. at 399.
In the MultiPlan MDL, Judge Matthew Kennelly found that Looper confirmed only that consent to direct filing is preferable, not that it is required. Judge Kennelly observed that, if the Seventh Circuit had held that direct filing requires consent, the JPML would have been broadcasting that news to all MDL judges. Judge Kennelly’s view is particularly notable given that he currently sits on the JPML—and was hailed by the Looper court as a “veteran MDL judge.” Looper, 20 F.4th at 392.
Judge Kennelly’s ruling hopefully helps clarify the threshold question of consent to direct filing for future MDLs. Stay tuned for the second part of this series, in which we’ll examine the impact of direct filling on choice of law and personal jurisdiction.
