Originally appeared in Law360 on March 30, 2016.
Welcome to the 20th installment of "And Now a Word from the Panel," a bimonthly column which "rides the circuit" with the Judicial Panel on Multidistrict Litigation as it meets at venues around the country.
In honor of reaching this milestone, this column will take a
look in hindsight, with "20/20 MDL Vision," at five key
takeaways from panel practice addressed by this column over the
past several years.
But before we embark on that retrospective journey, let us pause
for a moment to reflect on the present. As in years past, the panel
once again heads to its usual early Spring destination of the
Golden State of California for its March hearing session. But after
years of traveling to America's "Finest City" of San
Diego — which this column previously observed was the
panel's March choice of venue for seven consecutive years
— the panel shifts north to Santa Barbara for its March 31
hearing session.
Looking back on the January hearing session, the panel began the
new year once again scrutinizing MDL petitions, denying more
motions to create MDL proceedings than it created (more on that
later). And the overall total of existing MDL proceedings has now
dropped to 261, with the panel terminating a total of 14 MDLs in
the first two and a half months of this year.
Looking Back: A Fantasy Football MDL!
As readers of this column are aware, at its January hearing
session, the panel considered whether to create an MDL for a series
of actions against providers of fan versus fan online daily and
weekly fantasy sports contests. In re Daily Fantasy Sports
Marketing and Sales Practices Litigation (MDL No. 2677); In
reDraftKingsInc., Fantasy Sports Litigation (MDL No. 2678); In
reFanDuel Inc., Fantasy Sports Litigation (MDL No. 2679). At the
time of the panel's decision, there were 80 tag along and
related actions encompassed by those three proposed MDLs. As
discussed in our last column, the allegations involved different
theories of liability arising from different alleged conduct,
including employees using "inside information" to
participate in competitors' fantasy contests, deceptive offers
to match initial deposits and illegal gambling.
As expected, the issue was not as much whether to create an MDL,
but rather where the MDL would be located. In creating a single
"In re: Daily Fantasy Sports Litigation" MDL for all
three proposed MDL dockets, the panel found that the existence of
"differing theories of liability ... [is] not a bar to
centralization where common factual issues exist." The panel
also noted the "substantial overlap among the asserted
putative classes" and that some of the employees would be
witnesses in all actions. In expressing the deference given to an
MDL judge's management of the litigations, the panel left it to
that judge as to how best use "appropriate pretrial devices,
such as separate tracks for discovery or motion practice" and
whether and when to suggest remand of cases back to their
transferor courts.1
With respect to choice of the venue, the panel ultimately selected
the District of Massachusetts on the ground that:
- Plaintiffs and defendants in at least seven actions supported selection of the district;
- A significant number of related actions which encompassed all three theories of liability were pending in the district; and
- One of the defendants is headquartered in the district and individual defendants reside nearby.
20/20 MDL Vision
Looking back, with a bit of 20/20 hindsight since this column
first appeared in January 2013, the following are the key takeaways
from the various panel practices and tips presented over the past
three years:
1. Saying No to MDLs
In our very first column, we examined the factors that may lead the
panel to "Just Say No" to an MDL petition.2 As
we have seen from the panel over the past several years, it has
been increasingly scrutinizing MDL petitions. At the January
hearing session, out of the 10 potential MDL dockets considered,
the panel created only two new MDL proceedings (including the new
Fantasy Football MDL which was the subject of three proposed MDL
dockets) and denied six petitions.3 From time to time,
we have questioned whether we can fairly characterize the lower
percentage of new MDLs as a panel "trend." Although the
days of the panel granting 85 percent of MDL petitions, as was the
case in 2008, are likely behind us, we will continue to watch the
panel's average and whether it will break .500 for this
year.
Practitioners should continue to bear in mind the following factors
that the panel has used in denying petitions to create MDL
proceedings, including factors that the panel used to deny various
petitions considered at the January hearing session:
- Absence of common factual issues
- Overlapping counsel
- Limited number of actions
- Cases with different procedural postures
- Nonoverlapping putative class actions
- No overlapping plaintiffs or defendants
- State-specific legal and factual inquiries
- Available alternatives to MDL coordination.
2. MDL Deja Vu?
Over the past few years, we have seen second attempts to create an
MDL notwithstanding the panel's rejection of a prior MDL
petition arising from the same alleged conduct.4 The
panel has observed that it will grant a subsequent petition
"only rarely, however, where a significant change in
circumstances has occurred."5 The party seeking a
"second chance" at an MDL bears the burden of
showing:
- Growth in the number of actions
- Expansion of the geographic location of the litigation
- Existence of common factual issues
- Similar procedural posture of the various actions
- Lack of feasibility of informal coordination.
3. Location, Location, Location
One of our most exciting topics in the world of MDLs is venue
— i.e., which federal district will be selected as the MDL
transferee court for a particular new MDL proceeding.6
As noted above in connection with the new Fantasy Sports MDL, the
panel will often look to:
- Districts suggested by the parties
- Defendants headquarters
- Location of witnesses and documents
- Location of pending actions
But as we have reminded our readers, the absence of an action in
the proposed transferee district "is no impediment to its
selection as transferee district."7
4. And our [Judicial] Nominees are ....
It is a common practice for parties to suggest a particular MDL
transferee judge, in addition to suggesting a transferee judicial
district. In suggesting a particular jurist, practitioners may want
to consider the following factors, including whether the judge
has:
- Been assigned to a particular action
- The first-filed action
- MDL experience (or perhaps conversely, precisely because the judge has not yet had MDL experience, the judge would make a good choice)
- Experience with a similar type of case.8
5. Why Sports?
Readers may be wondering why recent columns have seemingly been
obsessed with the confluence of the worlds of sports and MDL
proceedings.9 Besides being unable to resist the lure of
sports metaphors, puns and analogies, the highlighting of these
sports MDL illustrates that:
- MDLs cut across all types of industries
- The factors that the panel applies in evaluating sports MDL petitions are indicative of the factors applied to other petitions before it.
What issues are in the panel's view at its next hearing
session? Will the panel continue its trend in scrutinizing MDL
petitions? Will we, with 20/20 hindsight, glean any additional
panel lessons? Stay tuned for our May edition of "And Now a
Word from the Panel," as the panel heads — for the
second time in three years — to the "Windy City"
(Chicago) for its May 26 hearing session.
» Read the full article onLaw360.
Footnotes
1 In re Daily Fantasy Sports Litig., MDL No. 2677
(J.P.M.L. Feb. 4, 2016).
2 "And Now a Word from the Panel," Law360 (Jan. 28,
2013).
3 This includes the denial of a motion for reconsideration of the
Panel Clerk's determination that a proposed MDL had lost its
multidistrict character because there were no longer two federal
cases pending in different districts. See In reWells Fargo
Inspection Fee Litig., MDL No. 2681 (J.P.M.L. Feb. 2, 2016).
4 See, e.g., "And Now a Word from the Panel," Law360
(Mar. 19, 2013).
5 In re Plavix Marketing, Sales Practices and Prods. Liab. Litig.
(No. II), MDL No. 2418, 923 F. Supp. 2d 1376, 1378 (J.P.M.L.
2013).
6 See, e.g., "And Now a Word from the Panel: Top 10 Venue
Arguments," Law360 (July 29, 2014).
7 In re Pella Corp. Architect and Designed Series Windows Prods.
Liab. Litig., MDL No. 2514, 996 F. Supp. 2d 1380, 1382 (J.P.M.L.
2014).
8 See, e.g., "And Now a Word from the Panel: Snow Day!"
Law360 (Mar. 25, 2014).
9 See, e.g., "And Now a Word from the Panel: Armchair
Quarterback MDL?" Law360 (Dec. 1, 2015).
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