United States: And Now A Word From The Panel: 4 All-Star MDLs

With summer in full swing, the panel moves west to "Rain City"—Seattle—for its July hearing session. What would July be without the All-Star Game, held this year in San Diego, a frequent panel destination. In honor of the occasion, this month's column will name its own all-star team—the four all-star MDLs of the decade.

But before unveiling the honorees (in various categories), we circle back to the panel's May hearing session in the "Windy City" of Chicago. Looking at that session, let us address both the panel's batting average for the year and the results of the "food fight" that we explored in our last column.

Turning to the panel's batting average, although unable to break the .500 mark, the panel is now batting .429 for the year—creating 12 new MDL proceeding and denying 16 MDL petitions. In addition, the overall number of pending MDL proceedings has dwindled slightly to 262, with the panel terminating a total of 23 existing MDLs in the first six and a half months of the year. ¹

Looking Back: Food Fight (Redux)!

At its May hearing session, the panel considered an MDL petition arising from a series of overlapping class actions alleging that a food retailer "underfilled" 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. In re Trader's Joe Co. Tuna Marketing and Sales Practices Litigation (MDL No. 2711).

Facially, these actions presented almost ideal candidates for a new MDL proceeding, with the risk of inconsistent verdicts looming large if left as standalone proceedings in various district courts around the country. But in an interesting twist that provides a valuable lesson as to alternatives to MDL treatment, the moving party, the plaintiff in the Illinois putative class action, withdrew her MDL petition. At the May hearing session, the panel inquired whether a venue transfer to the district court where other related putative class actions were pending would be a more efficient solution than the MDL process.² Shortly after the May hearing session, the petition was withdrawn based on representations made by the defendant retailer and other plaintiffs that they would seek to transfer of the Illinois and New York actions, pursuant to 28 U.S.C. § 1404, to the Central District of California, where two related putative class actions were pending. This mooted the MDL petition because the actions would be consolidated in a single federal court without the need for an MDL under 28 U.S.C. § 1407.

The import of this withdrawal cannot be underestimated as an illustration of how parties, and the panel itself, can proactively explore alternatives to MDL proceedings. Indeed, this may at least partially be responsible for the marked diminution in new MDL proceedings, a trend which this column has repeatedly noted. The relative paucity of actions in this potential tuna product MDL—with only three pending putative actions subject to the original MDL petition (and a fourth more recently filed action)—made this scenario ripe for creative alternative solutions, rather than adding to the tally of pending MDLs. By late June, and with the approval of the local federal district courts where the various actions outside of California were pending, the actions were transferred to the Central District of California independent of the MDL process.

Accordingly, and particularly where MDL petitions involve relatively few actions and counsel, the parties should consider whether transfer pursuant to 28 U.S.C. § 1404 is a viable alternative to the MDL process. Of course, the Section 1404 option may not always be warranted or desirable. In addition to requiring the cooperation among counsel and courts, a Section 1404 transfer would permit trials before the proposed transferee court. In contrast to an MDL transfer pursuant to Section 1407, Section 1404 transfers are not subject to Lexecon, which requires cases to generally be sent back to the original court for trial. Nevertheless, Section 1404 transfers are clearly an option on the panel's radar.

Four All-Star MDLs of the Decade!

In a month of all-stars, this column takes a retrospective (and somewhat lighter) look at MDL proceedings and names its "all-star" MDLs of the decade in the following categories: (1) the "multifaceted" MDL; (2) the "robust" MDL; (3) the "summer vacation" MDL; and (4) the "strange but true" MDL.

1. The "Multifaceted" MDL: In re 100 percent Grated Parmesan Cheese Marketing and Sales Practices Litig. (MDL No. 2705) (established June 2, 2016)

Although the panel has at times expressed a reluctance to establish an MDL proceeding for multiple products and multiple defendants, our "all-star" in this category, and a recent entry to the MDL world, is an exception. This MDL arises from the alleged marketing of cheese products as 100 percent cheese, despite containing cellulose. The MDL includes cases naming various retailers, manufacturers and even a supplier. The products at issue include both brand and house brand cheeses. Time will tell how this MDL will be organized and whether the panel's conclusion that "a single, multiproduct MDL is necessary to ensure the just and efficient conduct of this litigation"³ is justified. Indeed, the panel recognized that "[i]n many situations, we are hesitant to bring together actions involving separate defendants and products, but when, as here, there is significant overlap in the central factual issues, parties and claims, we find that creation of a single MDL is warranted."⁴ Albeit in its rookie stages, this cheese MDL is named an "all-star" because MDL watchers should pay close attention to the management of this multifaceted litigation and whether it is a harbinger for how the panel may deal with multidefendant, multiproduct MDLs in the future.

2. The "Robust" MDL: Product Liability Actions!

The "all-star" in this category is not a particular MDL proceeding, but rather a type of litigation that appears to have bucked the trend of a reduction in the number of MDL proceedings. At this time, a total of 53 MDLs involving "product liability" (as characterized by the panel) established since 2010 remain pending. This embodies more than 20 percent of the current MDL proceedings. Moreover, 19 of those 53 MDL product liability proceedings have had more than 1,000 individual actions, a "robust" category indeed!

3. The "Summer Vacation" MDL: In re Yosemite Park Hantavirus Litig. (MDL No. 2532) (established June 4, 2014)

As this column has previously recognized, even vacation spots can sometimes result in an MDL proceeding.⁵ Arising from an outbreak of the hantavirus at tent cabins at Yosemite during the summer of 2012, this MDL proceeding based in the Northern District of California involves claims against the United States. This MDL illustrates how the MDL process can be used to efficiently handle claims not only against private parties, but against the federal government as well. Earlier this year, the MDL judge limited the numbers of claims that could be asserted against the federal government under the Federal Tort Claims Act.

4. The "Strange but True" MDL: In re Subway Footlong Sandwich Marketing and Sales Practices Litig. (MDL No. 2439) (established June 10, 2013)

As readers of this column are aware, the MDL process embodies a wide range of industries and cases. Occasionally, an MDL petition raises a few eyebrows based on the claims at issue. Although not an easy call, the "all-star" award in this category goes to the MDL arising from a retail sandwich chain's "footlong" signature sandwiches. Following a social media posting that those "footlong" products may have only been 11 inches, a number of class actions were filed.⁶ After creation of the MDL, the parties engaged in settlement discussions. Earlier this year, the MDL judge granted final approval to the settlement which provided for attorneys' fees, limited incentive awards to class representatives and injunctive relief designed to ensure that "footlong" sandwich bread would be 12 inches, including use of a "tool" to measure bread (although the baking process can ultimately lead to slightly different sizes and/or shapes in the baked dough).⁷

What issues will the panel consider at its next hearing session? Will the panel continue to explore alternatives to MDL proceedings? What impact will the July Hearing Session have on the panel's batting average for the year? What will be the latest trend or "all-star" in the MDL world? Stay tuned for our September edition of "And Now a Word from the Panel," as the panel heads back east to Washington, D.C., the nation's capital, for its Sept. 29 hearing session.

Footnotes

1 http://www.jpml.uscourts.gov/sites/jpml/files/Recently_Terminated%20MDLs-1-1-2016_to_7-15-2016.pdf .

2 See Magier v.Trader Joe's Co., Case No. 16-cv-00043, Document No. 30, at 3 (S.D.N.Y June 21, 2016).

3 In re 100% Grated Parmesan Cheese Marketing and Sales Practices Litig., MDL No. 2705, at 3 (J.P.M.L. June 2, 2016).

4 Id.

5 See "And Now a Word from the Panel: What's Good for America?" Law360 (May 27, 2014).

6 See "And Now a Word from the Panel," Law360 (July 23, 2013); "And Now a Word from the Panel," Law360 (May 29, 2013).

7 In re Subway Footlong Sandwich Marketing and Sales Practices Litig., Case No. 13-02439, Document No. 84 (E.D. Wis. Feb. 25, 2016).

Originally appeared in Law360 on July 26, 2016.

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