What is a Mass Tort?

A Mass Tort (or Mass Action) involves related circumstances giving rise to claims by numerous plaintiffs against a limited number of defendants. The most common Mass Tort claims involve defective drugs, defective medical devices, environmental contamination, disasters, defective consumer products and the like. Mass Torts are consolidated for certain purposes that permit the court system to manage a large volume of similar, but discrete, claims. Many times, it is the varying liability, damages and procedural issues across individual, or categories of, Mass Tort cases that render those cases less amenable to Class Action treatment and more suited to Mass Action consolidation.

What is an MDL?

An MDL (or Multidistrict Litigation) is the manner in which Mass Tort cases filed in federal district courts throughout the nation are consolidated in one federal district court, before a single judge.

MDL’s are governed by the Judicial Panel on Multidistrict Litigation (“JPML”). The JPML consists of seven appellate and district court judges, each from a different judicial circuit, appointed by the Chief Justice of the United States. These seven judges decide by a majority vote whether to create an MDL, weighing such factors as the commonality of factual and legal issues and the value interdependence between the different claims. The JPML then selects the district court and assigns a judge to preside over the litigation. Each of the cases in the MDL retains its separate identity as it is prepared for trial and the JPML retains the authority to remand any MDL case back to the originating district court for trial.

The benefits of an MDL include uniform pleadings, discovery and motion practice before a judge that has the experience and resources to effectively manage complex litigation. The MDL structure also allows for the conservation of court system resources and permits the plaintiffs’ attorneys to pool and maximize their resources. Finally MDL’s are effective in avoiding conflicting rulings and employing specialized case management mechanisms (such as the preparation and use of “bellwether cases”).

What is an MCL?

An MCL (or Multicounty Litigation) is essentially the New Jersey state analog to an MDL. An MCL is the manner in which Mass Tort cases filed in trial courts throughout the state are consolidated in one state court, before a single judge. New Jersey MCL’s are particularly popular in pharmaceutical Mass Tort cases, as many large pharmaceutical companies maintain their principal place of business in New Jersey. This makes it very difficult[i] for those pharmaceutical companies to remove cases brought against them in New Jersey state court to federal district court, due to the “forum defendant” rule (28 U.S.C. § 1441(b)(2)), as well as the lack of diversity with New Jersey plaintiffs. Many times this will lead to a parallel federal MDL and state MCL.

MCL’s are governed by the New Jersey Supreme Court, pursuant to New Jersey Court Rule 4:38A. A party may make an application to establish an MCL to the Assignment Judge of any vicinage, or a party or Assignment Judge may apply directly to the New Jersey Supreme Court. The New Jersey Supreme Court then decides whether MCL status is warranted, based on whether the cases: 1) involve a large number of parties; 2) involve many claims with common, recurrent issues of law and fact associated with a single complex environment or toxic tort; 3) involve geographical dispersement of the parties; and 4) exhibit a high degree of commonality of injury or damages. In addition to these concerns, the court will consider whether centralization will expedite or delay the litigation and whether any party is unfairly prejudiced by MCL status. Once that determination is made, the New Jersey Supreme Court assigns the cases to one of the three sitting Mass Tort judges (there is also a separate judge for asbestos cases) in Bergen, Middlesex or Atlantic counties. Thereafter, the cases proceed in essentially the same manner as an MDL – frequently with some level of coordination between the MCL and MDL courts.

[i] Note that the Class Action Fairness Act of 2005 may apply to Mass Actions, as well as Class Actions, in certain circumstances.

What is a Class Action?

A Class Action is a lawsuit brought on behalf of a few named individuals (the class representatives), whose claims represent the similar claims of a much larger group of individuals (the class). The Class Action procedural mechanism, created under Federal Rule of Civil Procedure 23 (and reflected in parallel state rules, such as New Jersey Court Rule 4:32-1), allows for global resolution of common claims.

The general requirements for the establishment of a Class Action and certification of a class are: 1) the class is so numerous that joinder of all members is impracticable (numerosity); 2) there are questions of law or fact common to the class (commonality); 3) the claims or defenses of the representative parties are typical of the claims or defenses of the class (typicality); and 4) the representative parties will fairly and adequately protect the interests of the class (adequacy of representation). Again, varying liability, damages and procedural issues across many Mass Tort cases frequently render those cases unsuitable to Class Action treatment under the foregoing parameters. This makes the Class Action model more appropriate for cases involving employment, investor/securities, consumer fraud other similar claims.

Through the certification of a class of claimants, the Class Action mechanism provides a representative model used to resolve a large number of claims that could not be practicably prosecuted as separate lawsuits. Unlike a Mass Action, a Class Action does not consist of discrete cases, as the class representatives represent the entire class of pooled claims. Like a Mass Action, a Class Action provides for economies of scale and consistency in managing a large volume of claims. Further, a Class Action enables relatively smaller claims that could not be economically pursued on an individual basis, to be prosecuted as part of a class of numerous combined claims.

In the past, state-based Class Actions were considered to be, in many circumstances, more favorable to the interests of a putative or certified plaintiff class, but viable state-based Class Actions (and to some extent, Mass Actions) have become much more uncommon, following the enactment of the Class Action Fairness Act of 2005 (“CAFA”). CAFA altered the management and practice of Class Action litigation in federal and state courts. Concern that state courts would be hearing “nationwide Class Actions” that were more properly resolved in federal court, led Congress to expand the federal subject matter jurisdiction over Class Actions. CAFA created federal subject matter jurisdiction where: 1) the proposed class has over 100 members; 2) the aggregated claims of class members exceed $5,000,000, exclusive of costs and interest; and 3) any members of the class of plaintiffs is a citizen of a different state from any defendant. In addition, Congress also expanded a Class Action defendant’s removal opportunity by enacting 28 U.S.C. §1453, which prevents plaintiffs from including claims against in-state defendants for the sole purpose of avoiding removal, allows removal of a Class Action without regard to whether any defendant is a citizen of the state in which the action is brought, allows removal without the consent of all defendants, and eliminates the prohibition on removal of a diversity Class Action to federal court more than one year after the action commenced.

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