Monday, September 12, 2011
Jeremy Grabill (Weil Gotshal) has posted "Judicial Review of Private Mass Tort Settlements" to SSRN. The abstract provides:
In the mass tort context, class action settlements have largely given way to a unique form of non-class aggregate settlements that this Article refers to as “private mass tort settlements.” Although it has been argued that aggregation in tort law is “inevitable,” the legal profession has struggled for many years to find an effective aggregate settlement mechanism for mass tort litigation that does not run afoul of the “historic tradition” that everyone should have their own day in court, assuming they want it. Over the last decade, however, as a result of the evolution of non-class aggregate settlements, a new opt-in paradigm for mass tort settlements has emerged that is true to that historic tradition. This Article discusses the new opt-in paradigm and the appropriate contours of judicial authority vis-à-vis private mass tort settlements.
Private mass tort settlements present a difficult conundrum for presiding judges. On one hand, mass tort litigation requires active judicial involvement and oversight due to the sheer size and complexity of such matters. Thus, having been intimately involved in the litigation from its inception, it understandably seems natural for courts to want to exercise some degree of control over private mass tort settlements. But, on the other hand, like traditional one-on-one settlements and unlike class action settlements and other specific settlements, private mass tort settlements do not impact the rights of absent or unrepresented parties. Perhaps not surprisingly then, courts have struggled in applying established principles concerning the scope of judicial authority to evaluate and oversee the implementation of traditional settlements in the unfamiliar context of private mass tort settlements.
This Article seeks to provide a clear path forward by first examining the limited contexts in which courts have the authority to evaluate and oversee the implementation of traditional settlements, highlighting the nature of the absent or unrepresented interests that judicial review is designed to protect in those traditional contexts. The Article then discusses the emerging opt-in paradigm for mass tort settlements and traces the paradigm’s lineage to three recent cases: In re Baycol Products Liability Litigation, In re Vioxx Products Liability Litigation, and In re World Trade Center Disaster Site Litigation. The Article argues that the well-established maxim that courts lack authority over private one-on-one settlements should apply with equal force to private mass tort settlements because these non-class aggregate settlements allow each individual plaintiff to decide whether or not to settle on the terms offered and do not impact the rights of absent or unrepresented parties. In short, courts do not have - and do not need - the authority to review private mass tort settlements. The Article concludes by addressing the arguments that have been advanced to support judicial review of non-class aggregate settlements, debunking the “quasi-class action” theory that some courts have relied upon to regulate attorneys’ fees in connection with mass tort settlements, and discussing the various ways in which courts may nevertheless be able to influence private mass tort settlements.