United States: And Now A Word From The Panel: A 21st Century MDL

Welcome to the latest installment of "And Now a Word from the Panel," a bimonthly column which "rides the circuit" with the Judicial Panel on Multidistrict Litigation (or simply the "panel," for short) as it meets on a bimonthly basis at venues around the country.

In honor of our 21st installment, this month's column will address a burgeoning category of cases subject to MDLs during the 21st century — cyber MDLs, or more specifically, cases arising from an alleged data privacy breach. Since the beginning of 2015, the panel has established seven MDL proceedings in this area. At first glance, these cases appear to be a far cry from the electrical equipment antitrust cases which spurred Congress to establish the panel and MDL proceedings 48 years ago. But upon further reflection, the growth of these cyber MDL proceedings illustrates that the standards used to create MDL proceedings cut across industries and disciplines. The elasticity of the MDL statute and applicability of MDL procedures to our 21st century technological advances is a tribute to the vitality of the MDL process nearly five decades after its inception.

As we approach the heat of summer, the panel heads to the "Windy City" (Chicago, Illinois,) for the second time in three years for its May hearing session. But before looking ahead, we again take stock of the panel's scorecard for the year. At its March hearing session in Santa Barbara, California, the panel considered nine MDL petitions. In creating five new MDL proceedings, the panel raised its batting average for 2016 from .250 to .412, creating seven new MDLs and denying 10 petitions so far this year. Moreover, the overall total of existing MDL proceedings has dropped to 263, with the panel terminating a total of 18 existing MDLs in the first four and a half months of this year.1

Looking Back: A 21st Century MDL!

Returning to our 21st century MDL, at its March hearing session, the panel considered a petition to create an MDL proceeding arising from an alleged violation of privacy rights via the installation of software on a "Smart TV." In re Vizio Inc., Consumer Privacy Litigation, MDL No. 2693 (J.P.M.L. Apr. 7, 2016). In particular, plaintiffs in the actions alleged that the defendants collected data such as the (i) customer's television provider; (ii) the program and commercials viewed on the "Smart TV" including the time, date, channel and whether the program was viewed live or at a later time; and (iii) the Internet Protocol address associated with the television. The underlying claim in the 20 pending actions — including 15 original actions and five additional related actions — was that the defendants improperly shared this mined data with third parties, to "push targeted advertisements both to the Smart TV and to other devices (such as smart phones, desktop computers and tablet computers) that shared the same internet connection."2

The actions were pending in various federal district courts around the country — including California, Arkansas, Florida, Illinois and Indiana. All parties who responded to the MDL petition supported creation of an MDL. As is often the case, the salient battle was venue. Ultimately, the panel selected the Central District of California, where nearly half of all of the actions were pending and where defendants are headquartered. Moreover, in what appears to becoming a trend in panel practice, the panel steered this new MDL to a district court judge "who has not yet had the opportunity to preside over an MDL."3

This is not to suggest that this new wave of MDL proceedings will supplant the more traditional MDL staples such as product liability litigation. See, e.g., In re Window Wood Clad Window Prods. Liab. Litigation, MDL No. 2688 (J.P.M.L. Apr. 7, 2016). But the MDL world in many ways mimics the world around us. As cybersecurity and e-data privacy breaches continue to capture the general news headlines, we can only expect that the MDL docket for litigation arising in these areas to burgeon as well. Interestingly, the panel currently categorizes data privacy breach MDLs as a "miscellaneous" case for purposes of its statistical reporting.4 Time will tell whether this recent surge in e-data breaches/cyper MDLs will merit its very own MDL category!

Looking Forward: Food Fight (Redux)!

Three years ago, this column explored the panel's approach to a host of food related MDL petitions arising from alleged marketing and advertising practices.5 In particular, we highlighted the factors utilized by the panel in deciding whether to create food MDL proceedings, including the:

  • Number of actions
  • Number of federal districts in which the actions are pending
  • Geographic proximity of the pending federal actions
  • Number of plaintiffs counsel involved
  • Pendency of overlapping class action
  • Procedural posture of the actions
  • Complexity of the issues involved

Indeed, food MDLs are as much a part of the fabric of the 21st century MDL landscape as cyber MDLs, antitrust MDLs, product liability MDLs, patent MDLs and even sports MDLs. There are currently at least a dozen MDL proceedings arising from the marketing of food products as diverse as drinks, snack bars (among other snack items), spices and pet food.

This month, the MDL considers the latest applicant to join the ranks of the food MDLs. In re Trader's Joe Company Tuna Marketing and Sales Practices Litigation (MDL No. 2711). This tuna product MDL petition arises from the alleged "underfilling" of six different types of tuna sold in 5 ounce cans, which allegedly contained less than the minimum "standard of fill" for cans of that size. The defendant retailer supports creation of an MDL proceeding, originally sought by a plaintiff, for several nationwide federal class actions, including cases filed in California, Illinois and New York. In support of the MDL petition, defendant acknowledges the relative paucity of cases, but notes that the pending cases (three at the time of the briefing), all in their early stages, involve different plaintiffs counsel and the nationwide class actions present overlapping classes. Since defendant's briefing, a fourth nationwide class action has been filed.

Although the panel often grants MDL motions when plaintiffs and defendants agree to centralization, the key for practitioners to watch with respect to this proposed food MDL is whether the presence of only four actions warrants MDL treatment. Looking to the factors previously used by the panel in addressing food MDL petitions, these cases spanning from East to West appear to be ideal candidates.

The takeaway for practitioners is that whether or not an MDL petition is a 21st or 20th century MDL, and whether or not it involves technology, food, sports, antitrust or product liability, the panel will apply similar standards in evaluating the propriety of creating a new MDL and where that MDL will be venued.

What issues will the panel consider at its next hearing session? Will the panel face more 21st century technology based, or even food, MDL petitions? What will be the latest trend in the MDL world? Stay tuned for our July edition of "And Now a Word from the Panel," as the panel heads back West — to Seattle, Washington, for its July 28 hearing session.

Originally appeared in Law360 on May 24, 2016. Read the full article on Law360 (subscription required).

Footnotes

[1] http://www.jpml.uscourts.gov/sites/jpml/files/Recently_Terminated%20MDLs-1-1-2016_to_5-16-2016.pdf.

[2] In re Vizio, Inc., Consumer Privacy Litig., MDL No. 2693 (J.P.M.L. Apr. 7, 2016)

[3] Id. at 2; see also, "And Now a Word from the Panel: 2015 JPML Practice Trends," Law360 (Jan. 26, 2016); In re Domestic Airline Travel Antitrust Litig., MDL No. 2656, at 2 (J.P.M.L. Oct. 13, 2015); In re TD Bank, N.A., Debit Card Overdraft Fee Litig., MDL No. 2613, at 2 (J.P.M.L. Apr. 2, 2015).

[4] http://www.jpml.uscourts.gov/sites/jpml/files/Pending_MDL_Dockets_By_Type-May-16-2016.pdf.

[5] See "And Now a Word from the Panel," Law360 (May 29, 2013); "And Now a Word from the Panel," Law360 (July 23, 2013); "And Now a Word from the Panel," Law360 (Sept. 24, 2013).

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