Tuesday, August 19, 2008

The MDL Panel Plays It By The Book In Denying Plaintiffs’ Motion To Centralize The Shoulder Pain Pump Litigation

The following guest post was written by Pearson Bownas of Jones Day. As is always true of guest posts, Pearson gets the credit; we get the blame:


Whether the Judicial Panel on Multidistrict Litigation (the “MDL Panel” or “Panel”) grants or denies a motion to centralize cases pending in different federal district courts and transfers them to a single federal judge for coordinated or consolidated pretrial proceedings can profoundly affect the dynamics of product liability litigation. I have previously identified and analyzed the factors that influence the MDL Panel’s decision to grant or deny a motion to centralize and transfer product liability cases. I have also explained why those factors are likely to have the same effect on the Panel’s decisions in the future, notwithstanding regular changes in the Panel’s composition. This post applies both of those previous efforts to the Panel’s recent decision denying a motion to centralize product liability cases against medical device and pharmaceutical manufacturers. I conclude (thankfully!) that the current MDL Panel is indeed applying the same factors, in the same way, as its predecessors, continuing to allow litigants and their attorneys some ability to predict the outcome of the Panel’s decisions in product liability cases.

In February 2007, I published an article with one of this blog’s co-hosts, Mark Herrmann, titled “Making Book On The MDL Panel: Will It Centralize Your Products Liability Cases?” (Click here for the article.) There, we analyzed every decision issued by the MDL Panel involving product liability cases and reverse-engineered the factors that influence how the Panel decides motion to centralize product liability cases.

We identified five factors that lower the odds that the Panel will centralize cases. First, the Panel is less likely to centralize cases when no party favors centralization. This factor addresses the Panel’s ability to issue sua sponte orders to show cause why pending actions should not be centralized. This factor has become largely obsolete, as the MDL Panel has issued just two sua sponte orders to show cause regarding the centralization of product liability actions since 1980, and both were part of the Panel’s extraordinary efforts to solve the federal asbestos litigation crisis.

Second, the Panel is less likely to centralize cases when the underlying actions raise primarily individual, not common, issues, because they involve many defendants, diverse plaintiffs, or different modes of exposure to the allegedly offending products.

Third, the Panel is less likely to centralize cases when the primary pretrial tasks that the MDL transferee judge would normally oversee have already been completed by other judges.

Fourth, the Panel is less likely to centralize cases when, “[g]iven the minimal number of actions before” it, the Panel is not convinced “that any common questions of fact that may be involved in these actions are sufficiently complex, and that the accompanying discovery will be so time-consuming, to justify Section 1407 transfer.” E.g., In re Republic of China Civilian Ammunition Prods. Liab. Litig., MDL No. 775, 1988 U.S. Dist. LEXIS 17031, at *1-*2 (J.P.M.L. Oct. 5, 1988) (denying motion to centralize two actions pending in two districts). The Panel has not in its product liability orders explained what the complexity threshold is. Accordingly, this factor seems to relate mostly to the number of pending actions.

Fifth, the Panel is less likely to centralize cases when the same plaintiffs or plaintiffs’ counsel are involved in most or all of the subject actions.

We also identified two independent factors that increase the odds of centralization. (We call them “independent” factors to distinguish them from the mere absence of the five factors that, if present, reduce the odds of centralization. Because, for example, completed pretrial tasks reduce the odds of centralization, it stands to reason that uncompleted pretrial tasks increase the odds of centralization. But the mere absence of any of the five factors mentioned above seems not to carry nearly as much weight in favor of centralization as its presence carries against centralization, or as the presence of either of the two “independent” factors carries in favor of centralization.)

First, the Panel is more likely to centralize cases that involve overlapping or potentially overlapping putative class action claims.

Second, the Panel is more likely to centralize cases when the defendant (or defendants) supports, or at least does not oppose, transfer.

Even though our analysis reached back to the Panel’s 1968 origins, and therefore covered many changes in the Panel’s composition over that thirty-nine year span, the appointment of a new Panel chairman, Judge John G. Heyburn, II, caused me to write a guest post here in July 2007, titled “Why The Changing Face Of The MDL Panel Won’t Change The Outcome Of Your Transfer Motion.” That post (link here) explored the process by which MDL Panel members are replaced and explained why the regular turnover in MDL Panel membership is not likely to change how the Panel is influenced by the factors identified in our article.

Today’s post puts our article and that previous guest post to the test. On August 11, 2008, the MDL Panel issued an order denying transfer in In re Shoulder Pain Pump – Chondrolysis Products Liability Litigation, MDL No. 1966. (Here's a link to the Panel’s order.) I decided to apply the factors we identified in our article to that decision to see if the current Panel members apply the same factors in the same way that other Panel members historically have.

They do.

The Shoulder Pain Pump Litigation involves medical devices that pump anesthetic medication through a catheter into the space surrounding the shoulder joint to relieve pain following arthroscopic shoulder surgery. Plaintiffs have alleged that these pumps and/or the anesthetic medications they administer cause irreversible cartilage damage in the shoulder joint. Plaintiffs in thirteen actions pending in eight federal district courts against pain pump and anesthetic drug manufacturers asked the MDL Panel to centralize their cases in, and transfer them to, the District of Oregon. The MDL Panel denied the plaintiffs’ transfer motion because one of the factors weighing against transfer was present, and none of the factors weighing in favor of transfer was present.

The second factor we identified that lowers the odds of transfer – different defendants and/or different modes of exposure to the allegedly offending product – was present in the Shoulder Pain Pump Litigation. While the Panel acknowledged “some commonality” among the underlying actions “as to whether shoulder pain pumps and/or the anesthetic drugs used in those pumps cause” the alleged injuries, it emphasized that “an indeterminate number of different pain pumps made by different manufacturers are at issue, as are different anesthetic drugs made by different pharmaceutical companies. Moreover, not all of the thirteen constituent actions involve pharmaceutical company defendants, and many defendants are sued only in a minority of those actions.” Order Denying Transfer at 2.

The Panel pointed out, for example, that five pharmaceutical defendants were each named in only one of the underlying actions. Id. at 2 n.6. The Panel therefore was not convinced “that the efficiencies that might be gained by centralization would not be overwhelmed by the multiple individualized issues (including ones of liability and causation) that these actions appear to present.” Id. at 2.

Moreover, neither independent factor that raises the odds of transfer –overlapping putative class claims or defense support for transfer – was present. To the contrary, the Panel stressed that “[n]one of the [underlying] actions is a class action” (id. at 2 n.5), and that the “[r]esponding defendants all oppose centralization.” Id. at 2 (footnote omitted). On the basis of these factors, the Panel denied the motion to centralize and transfer these cases.

The composition of the MDL Panel has changed over the years, and it will continue to change. But in proceedings involving product liability cases, certain factors influence how the Panel is likely to decide a transfer motion. These factors have stood the test of time, and the Panel’s recent decision in In re Shoulder Pain Pump – Chondrolysis Products Liability Litigation suggests that the same factors will continue to influence the Panel in the same way, even as its membership changes. Lawyers who are familiar with these factors will be better able to “make book” on the MDL Panel and predict for their clients how the Panel will decide a transfer motion in products liability cases.

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