Time on Your Side: Bifurcated Trials on the Statute of Limitations

The statute of limitations is a powerful defense for defendants. But it is a tricky one to assert at trial in any of the majority of states recognizing a discovery rule that commonly provides that the statute of limitations begins to run when the plaintiff knew or should have known of a potential claim. Asserting the defense requires a defendant who denies liability to argue simultaneously to the jury what may seem to be contradictory positions: first, that there is no claim and, second, that the plaintiff should have known of the claim before a certain date.

Enter bifurcation. Most are familiar with the concept of bifurcating compensatory liability and punitive damages. But as far back as the 1940s, courts have recognized that Federal Rule of Civil Procedure 42 can be used to bifurcate the issues of liability and the statute of limitations. A trial solely on the issue of the statute of limitations allows defendants to have a streamlined, efficient trial that avoids the seeming contradiction between defending against liability and forcefully asserting a statute of limitations defense.

Federal Rule of Civil Procedure 42(b)

Rule 42(b) grants federal courts broad discretion to bifurcate (i.e., separate) a trial “[f]or convenience, to avoid prejudice, or to expedite and economize.”

Bifurcating issues for trial is not new—courts have recognized the value of bifurcated trials for more than a century. Courts may bifurcate the liability phase of trial from the damages phase of trial. Some courts are also inclined to bifurcate the jury’s determination of compensatory damages from that of punitive damages. As Wright & Miller have explained, Rule 42(b) “is sweeping in its terms and allows the district court, in its discretion, to grant a separate trial of any kind of issue in any kind of case.” Bifurcating affirmative defenses—including the statute of limitations defense—is thus clearly within district courts’ authority. See Yung v. Raymark Indus., Inc., 789 F.2d 397, 401 (6th Cir. 1986); Braun v. Berenson, 432 F.2d 538, 543 (5th Cir. 1970).

Because the statute of limitations can be dispositive of all claims in a case, if a jury ultimately finds that the plaintiff’s claims are untimely, then there is no need for a long, expensive merits trial on issues of liability and damages. See In re Beverly Hills Fire Litig., 695 F.2d 207, 216 (6th Cir. 1982) (“[W]hether resolution of a single issue would likely be dispositive of an entire claim is highly relevant in determining the efficacy of bifurcation.”). In observing that the statute of limitations is a “prime candidate” for bifurcation, the Seventh Circuit aptly stated that “the potential savings are greatest when a case is put to death at an early stage.” Stewart v. RCA Corp., 790 F.2d 624, 629 (7th Cir. 1986). Bifurcating trial on the statute of limitations provides that earlier stage.

The Benefits of Bifurcation

Under Rule 42(b), trial may be bifurcated (1) “[f]or convenience,” (2) “to avoid prejudice,” or (3) “to expedite and economize.” Bifurcation of the statute of limitations defense serves all three of these interests.

Bifurcation of the statute of limitations promotes economy and efficiency. Judicial economy is a controlling consideration under Rule 42(b), and courts have found that bifurcation is proper when calculated to conserve judicial resources and reduce litigation costs. See In re Paoli R.R. Yard PCB Litig., 113 F.3d 444, 452 n.5 (3d Cir. 1997) (stating that dispositive issues are particularly suitable for bifurcation because their resolution can “reduce the length of trial . . . and improve comprehension of the issues and evidence”). Bifurcation can save the courts—as well as the parties, witnesses, and even the jury—significant time and resources.

• Length and complexity of trial—A trial dedicated solely to the statute of limitations will likely be significantly shorter than a full trial, particularly in pharmaceutical products liability cases. A statute of limitations trial will also require far fewer exhibits and witnesses than a trial on liability. In Young v. Mentor Worldwide LLC, 312 F. Supp. 3d 765, 768 (E.D. Ark. 2018), a pelvic mesh case, the defendant estimated that a statute of limitations trial would require only 3 witnesses rather than more than 15 fact, expert, and company witnesses that a trial of liability would require. Two more recent bifurcated pelvic mesh preliminary trials on the statute of limitations (one in the District of Arizona and the other in the District of Nevada) spanned just two days. In each of those trials, only two live witnesses testified, only two video depositions were played, and no experts appeared. By contrast, the subsequent trials on liability spanned 7 days, during which 7 live witnesses testified (5 of whom were experts) and 10 video depositions were played.
• Pretrial judicial resources—Because the statute of limitations issue is narrow in scope, the court can expend fewer resources ruling on motions unrelated to the statute of limitations. For example, few—if any—expert witnesses will be called to testify. Thus, the court can wait to rule on the parties’ Daubert motions or time-consuming deposition designations until after the jury’s determination on the statute of limitations. Similarly, the parties can stipulate as to which motions in limine require a ruling prior to the preliminary trial.
• Discovery and motion practice—Given the dispositive nature of the statute of limitations, the parties can ask the court to stay the remaining discovery and motion deadlines until after the first trial. Courts (like the Southern District of Ohio) have recognized the value of limiting litigation expenses in determining whether to order bifurcation. E.g., Yacub v. Sandoz Pharma. Corp., 85 F. Supp. 2d 817, 828 (S.D. Ohio 1999).

Bifurcation of the statute of limitations avoids confusion of the issues. The question in a statute of limitations trial is simple: When did the plaintiff’s claim accrue? That’s it. Presentation of complex scientific causation evidence has the potential to confuse the jury and cause jurors to lose sight of the facts pertinent to a statute of limitations issue altogether. A trial solely on timeliness allows the jury to focus on that issue without being sidetracked by thornier substantive liability issues.

Bifurcation prevents prejudice to defendants. There is great risk of potential prejudice in trials in which defendants are both disputing liability and establishing a statute of limitations defense. In many states with a discovery rule, a defendant must establish that the plaintiff knew of his or her injury and discovered (or should have discovered) its cause. It can be a difficult distinction for jurors (and even some lawyers) to grasp that a defendant can deny liability and causation while simultaneously asserting that the plaintiff either knew or should have known of a causal connection between the product and the claimed injury. The plaintiff’s knowledge of potential causation, which triggers the statute of limitations, is not the same as legal and scientific causation, which requires proof that the product did cause the plaintiff’s injury. In recent years, federal courts have recognized that these seemingly contradictory positions subject defendants to undue prejudice and that bifurcation can prevent that consequence.

Right to a Jury Trial

Courts ordering bifurcation under Rule 42(b) must “preserve any federal right to a jury trial.” The Seventh Amendment proscribes bifurcation when the questions sought to be bifurcated are so interwoven that the one question cannot be submitted to the jury independently of the other without confusion and uncertainty, which would amount to a denial of a fair trial. Thus, separate juries may consider overlapping evidence but may not consider overlapping issues. Courts have found that, for preliminary trials on the statute of limitations, while there may be some overlap of testimony and evidence between the two trials, any such overlap will not be significant. In fact, if a trial on the issues becomes necessary, the defendants can eliminate the need for proof relating to the issue of timeliness (as well as the potential prejudice that comes with it).

Conclusion

A trial solely on the statute of limitations enables defendants to have a streamlined, cost-efficient trial on the statute of limitations defense without having to navigate between the Scylla of prosecuting the statute of limitations defense and the Charybdis of weakening the substantive defense against liability. It is a powerful tool all defendants should keep in their tool kits.