Multidistrict and Multicircuit Litigation: Coordinating Related Federal Cases

November 17, 2021

Multidistrict and Multicircuit Litigation: Coordinating Related

Federal Cases

Sometimes a single event or a common set of facts spurs

litigation in multiple federal courts. For instance, a plane

crash or a widespread product defect may affect individuals

from many states and lead to numerous related district court

lawsuits, or a federal regulation with national reach may

trigger petitions for review in several federal appeals courts.

Such proceedings are known as multidistrict litigation or

MDL at the district court level and multicircuit petitions for

review at the circuit court level. Congress has enacted

statutes creating special procedures for both MDL and

multicircuit petitions with the goal of allocating judicial

resources efficiently and ensuring consistency across

related cases.

District Court MDL

The procedures governing MDL in the trial-level federal

district courts date from the 1960s. Between the 1940s and

the early 1960s, the federal courts grappled with how to

address the increasing complexity of federal litigation,

particularly the proliferation of multiple cases raising

overlapping questions of law and fact. In the early 1960s,

federal courts developed ad hoc procedures to coordinate

hundreds of civil suits that arose following criminal

antitrust prosecutions of certain electrical equipment

manufacturers. Recognizing the need for a more formal and

comprehensive solution, the Judicial Conference of the

United States also called on Congress to act in this area.

A key feature of the district court MDL statute is that it

allows for transfer and consolidation of pretrial proceedings

only. MDL proceedings in a transferee court may include

cases originally filed in that district, cases transferred to that

district, and cases filed in the transferee district after the

proceedings have been centralized there. The transferee

court must remand any case that is not terminated before

trial to the district from which it was transferred or the

district in which the case would have been filed in the first

instance. As a practical matter, however, relatively few

MDL cases are remanded: the MDL Panel reports that as of

September 30, 2020, more than 97% of terminated MDL

proceedings were terminated by transferee courts, while

fewer than 3% were remanded. One reason for this is that

the vast majority of federal cases terminate before trial,

either through motions to dismiss or for summary judgment

or because the parties reach a settlement. Moreover,

transferred MDL cases may remain in the transferee court

for trial if the parties consent to it.

One high-profile example of district court MDL is the

opioid MDL, in which an Ohio district court judge is

coordinating pretrial proceedings in more than 2,400 cases

against opioid manufacturers and distributors alleging that

the defendants contributed to the opioid epidemic by

misrepresenting the risks of long-term opioid use and

failing to monitor suspicious orders.

In 1968, Congress enacted the district court MDL statute,

28 U.S.C. § 1407, and established the Judicial Panel on

Multidistrict Litigation (MDL Panel). The statute allows the

MDL Panel to transfer cases to a single district court for

coordinated or consolidated pretrial proceedings. The Panel

may exercise this power when cases involve “one or more

common questions of fact,” and when it determines that the

transfer “will be for the convenience of parties and

witnesses and will promote the just and efficient conduct of

such actions.” The MDL statute gives the MDL Panel

significant discretion in determining whether to consolidate

proceedings.

Multicircuit Petitions for Review in the

Federal Appeals Courts

The MDL Panel reports that since its establishment, it has

“considered motions for centralization in more than 2,870

dockets involving almost 670,000 cases and millions of

claims.” The Panel further reports that its “dockets

encompass litigation categories as diverse as airplane

crashes [and other accidents]; mass torts, such as those

involving asbestos, drugs and other products liability cases;

data security breaches, patent validity and infringement;

antitrust price fixing; marketing and sales practices,

securities fraud; and employment practices.”

Congress enacted the current version of Section 2112 in

1988. Before the 1988 amendment, the statute provided that

if petitions for review of the same agency action were filed

in multiple circuit courts, all proceedings were to be

transferred to the court where proceedings were first

instituted. This practice sometimes led to a “race to the

courthouse” as litigants sought to give their preferred court

of appeals the first opportunity to consider their claims.

While federal litigation often begins in the district courts,

Congress has provided for direct review of some agency

actions in the federal circuit courts of appeals. For instance,

petitions for review of certain agency actions under the

Clean Air Act and the Clean Water Act must commence in

the federal appeals courts. Because federal agency

rulemaking frequently applies nationwide, a single agency

action often gives rise to petitions for judicial review in

several federal appeals courts. A federal statute, 28 U.S.C.

§ 2112, governs those multicircuit petitions for review.

Following the 1988 amendment, multicircuit petitions for

review are no longer automatically consolidated in the court

of first filing. Instead, the statute provides that if petitions

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Multidistrict and Multicircuit Litigation: Coordinating Related Federal Cases

for review of a single agency order are filed in two or more

circuit courts within ten days after issuance of the order, the

MDL Panel “shall, by means of random selection, designate

one court of appeals, from among the courts of appeals in

which petitions for review have been filed.” MDL Panel

Rule 25.5 implements the statutory provision for random

selection through a lottery, directing the Clerk of the Panel

to “randomly select a circuit court of appeals from a drum

containing [a single] entry for each circuit wherein a

constituent petition for review is pending.” Once

proceedings are consolidated in one circuit court, the statute

authorizes the transferee court to transfer proceedings to

any other appeals court “[f]or the convenience of the parties

in the interest of justice.”

A recent high-profile example of a multicircuit petition for

review is the litigation surrounding the Coronavirus Disease

2019 (COVID-19) vaccine mandate for employers with 100

or more employees. On November 5, 2021, the

Occupational Safety and Health Administration published

an emergency temporary standard requiring those

employers to implement certain vaccination and testing

policies. Challengers of the policy filed petitions for review

in multiple federal appeals courts. On November 16, 2021,

the MDL Panel conducted a lottery and randomly selected

the U.S. Court of Appeals for the Sixth Circuit to consider

the cases in the first instance.

Considerations for Congress

The processes that Congress has established for MDL and

multicircuit petitions for review are motivated primarily by

practical considerations such as the efficient administration

and consistent decision of large volumes of related claims.

Congress has sometimes made adjustments or exceptions to

those processes, tailoring how they apply to certain types of

cases. For instance, Section 1407 provides that it does not

apply “to any action in which the United States is a

complainant arising under the antitrust laws.” Congress

amended Section 1407 in 1976 to allow the MDL Panel to

“consolidate and transfer with or without the consent of the

parties, for both pretrial purposes and for trial, any action

brought under section 4C of the Clayton Act.” Section 2112

specifies that it does not apply to review of Tax Court

decisions. Proposals from the 116th Congress, including the

SAFE TO WORK Act, S. 4317, H.R. 8832 (116th Cong.

2020), would have imposed specific procedures in MDL

involving certain legal claims related to COVID-19.

Many commentators agree that the statutes governing MDL

and multicircuit petitions have generally advanced

Congress’s practical purposes, promoting efficiency for the

parties and the courts. Some urge Congress to take

additional steps in that direction, arguing that a substantial

percentage of MDL claims are meritless, and that better

procedures are needed to weed out unsupported claims

before settlement or trial.

Other commentators have examined how the practice of

case transfers and consolidation under the MDL and

multicircuit petition statutes may affect the administration

of justice more generally. Some assert that the statutes may

prompt excessive consolidation and far-reaching settlement

of claims. In their view, such settlements may affect the

rights of future claimants, but the protections for absent

claimants in Federal Rule of Civil Procedure 23 (which sets

various procedural requirements for class actions) do not

generally apply to MDL proceedings unless the transferee

court formally certifies a class action. In addition, some

note that the rules governing appeals may create an

asymmetry for MDL plaintiffs and defendants. If a court

grants an MDL defendant’s motion to dismiss, the plaintiff

is entitled to an immediate appeal; however, if the court

denies the motion, the denial usually is not immediately

appealable. While this rule applies generally in federal civil

litigation, some commentators contend that in the MDL

context it may impose particularly strong pressure on

defendants to settle.

Along with class actions, MDL cases may also raise

broader concerns about litigation funding and fees. In some

cases, third parties fund federal litigation, including MDL

and class actions, in exchange for a portion of the plaintiffs’

recovery. The Litigation Funding Transparency Act of

2021, S. 840, H.R. 2025 (117th Cong. 2021), would

respond to that concern by requiring disclosure of any

entities with a right to payment contingent on the receipt of

monetary relief in any MDL or class action.

Beyond the statutes governing MDL and multicircuit

petitions for review, Congress has other tools available to

address concerns about related lawsuits proceeding in

multiple courts. One option is to channel certain types of

cases to a specific venue. For instance, multiple federal

statutory provisions require petitions for review of certain

types of agency action to be brought in the U.S. Court of

Appeals for the District of Columbia Circuit. If all

challenges to a particular agency action are filed in the

same court, that court can determine whether to consolidate

or otherwise coordinate related litigation.

Joanna R. Lampe, Legislative Attorney

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IF11976

Multidistrict and Multicircuit Litigation: Coordinating Related Federal Cases

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