Thursday, March 31, 2011
Welcome Guest Blogger Colin Miller
We are pleased to welcome Professor Colin Miller as a guest blogger during the month of April. Colin is an Associate Professor at The John Marshall Law School in Chicago, where he teaches evidence, criminal procedure, criminal law, and civil procedure. He is a prolific scholar as well (check out his SSRN page).
Colin is also the creator and editor of EvidenceProf Blog, a sibling of ours in the Law Professor Blogs network.
Thanks for joining us, Colin!
March 31, 2011 in Weblogs | Permalink | Comments (0)
Yesterday's SCOTUS Oral Argument in PLIVA, Inc. v. Mensing: Federal Preemption & Generic Drugs
The Supreme Court heard argument yesterday in three consolidated cases that raise the question of federal preemption of state-law tort liability in claims involving generic drugs. The oral argument transcript is available here.
The cases are PLIVA, Inc. v. Mensing (09-993), Actavis Elizabeth, L.L.C. v. Mensing (09-1039), and Actavis, Inc. v. Demahy (09-1501). (Links are to SCOTUSblog’s case files for each case, where you can find the docket, lower court opinions, and all the briefs.)
An amicus brief filed in the case by administrative law and civil procedure scholars is available here.
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March 31, 2011 in Supreme Court Cases | Permalink | Comments (0)
Wednesday, March 30, 2011
Oral Argument Transcript in Wal-Mart v. Dukes
The transcript from yesterday's oral argument in Wal-Mart Stores, Inc. v. Dukes is available here.
For a sampling of the extensive commentary and stories about yesterday's argument, see the ABA Journal, How Appealing, the National Law Journal, and SCOTUSblog.
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March 30, 2011 in Class Actions, Supreme Court Cases | Permalink | Comments (0)
While you were thinking about Dukes v. Wal-Mart...
The 11th Circuit recently decided Fitzpatrick v. General Mills, ordering a distrct court to broaden the class it certified. Fitzpatrick is a class action brought by plaintiffs who believe that General Mills overcharged them for "probiotic yogurts" such as Yo Plus and misled them as to any existing health benefits.
The 11th Circuit not only approved of the class action, but suggested that the class does not need to be limited to consumers who relied on statements concerning the yogurt's health benefits.
RJE
March 30, 2011 in Class Actions, In the News | Permalink | Comments (0)
Tuesday, March 29, 2011
SCOTUS Oral Argument in Wal-Mart v. Dukes
The Supreme Court hears argument today in Wal-Mart Stores, Inc. v. Dukes. The questions presented are:
Whether claims for monetary relief can be certified under Federal Rule of Civil Procedure 23(b)(2)—which by its terms is limited to injunctive or corresponding declaratory relief—and, if so, under what circumstances.
Whether the class certification ordered under Rule 23(b)(2) was consistent with Rule 23(a).
SCOTUSblog’s case file is available here, which contains links to the Ninth Circuit opinion below and the briefing in the case.
There is a ton of coverage on the case and the upcoming argument, including:
- ABA Journal
- Associated Press
- The Atlantic
- Chicago Tribune
- CNN
- How Appealing
- New York Times
- SCOTUSblog
- Washington Post
An amicus brief filed in the case by thirty-one civil procedure professors is available here.
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March 29, 2011 in Class Actions, In the News, Supreme Court Cases | Permalink | Comments (0)
Monday, March 28, 2011
Federal Judicial Center Report on the Impact of Twombly/Iqbal
The Federal Judicial Center has released a Report to the Advisory Committee on Civil Rules entitled Motions to Dismiss for Failure to State a Claim After Iqbal, authored by Joe S. Cecil, George W. Cort, Margaret S. Williams & Jared J. Bataillon. Here’s the executive summary:
This report presents the findings of a Federal Judicial Center study on the filing and resolution of motions to dismiss for failure to state a claim under Rule 12(b)(6) of the Federal Rules of Civil Procedure. The study was requested by the Judicial Conference Advisory Committee on Civil Rules. The study compared motion activity in 23 federal district courts in 2006 and 2010 and included an assessment of the outcome of motions in orders that do not appear in the computerized legal reference systems such as Westlaw. Statistical models were used to control for such factors as differences in levels of motion activity in individual federal district courts and types of cases.
After excluding cases filed by prisoners and pro se parties, and after controlling for differences in motion activity across federal district courts and across types of cases and for the presence of an amended complaint, we found the following:
• There was a general increase from 2006 to 2010 in the rate of filing of motions to dismiss for failure to state a claim (see infra section III.A).
• In general, there was no increase in the rate of grants of motions to dismiss without leave to amend. There was, in particular, no increase in the rate of grants of motions to dismiss without leave to amend in civil rights cases and employment discrimination cases (see infra section III.B.1).
• Only in cases challenging mortgage loans on both federal and state law grounds did we find an increase in the rate of grants of motions to dismiss without leave to amend. Many of these cases were removed from state to federal court. This category of cases tripled in number during the relevant period in response to events in the housing market (see infra section III.B.1). There is no reason to believe that the rate of dismissals without leave to amend would have been lower in 2006 had such cases existed then.
• There was no increase from 2006 to 2010 in the rate at which a grant of a motion to dismiss terminated the case (see infra section III.B.1).
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(Hat Tip: Lonny Hoffman)
March 28, 2011 in Federal Rules of Civil Procedure, Recent Scholarship, Twombly/Iqbal | Permalink | Comments (1)
Green on Erie's Suppressed Premise
Michael Steven Green (William and Mary Law School) has posted Erie's Suppressed Premise to SSRN.
Abstract:
The Erie doctrine is usually understood as a limitation on federal courts’ power. This Article concerns the unexplored role that the Erie doctrine has in limiting the power of state courts.
According to Erie Railroad Co. v. Tompkins, a federal court must follow state supreme court decisions when interpreting state law. But at the time that Erie was decided, some state supreme courts were still committed to Swift v. Tyson. They considered the content of their common law to be a factual matter, concerning which federal (and sister state) courts could make an independent judgment. Indeed, the Georgia Supreme Court still views its common law this way. In order to explain Brandeis’s conclusion in Erie that state supreme court decisions bind federal courts, even when the state supreme court does not want them to be binding, a premise must be added to his argument - one that limits state supreme court power in this area.
The missing premise is a non-discrimination principle that is a hitherto unrecognized - but essential - part of the Erie doctrine. A state supreme court can free federal courts of the duty to follow its decisions only if it is willing to free domestic courts of the same duty. It cannot discriminate concerning the binding effect of its decisions on the basis of whether the effect is in domestic or federal court.
A similar puzzle arises when a federal court interprets unsettled state law. The Supreme Court has suggested that a federal court should predict how the relevant state supreme court would decide. But many state supreme courts - including the New York Court of Appeals - have indicated that they do not care if federal (or sister state) courts use the predictive method concerning their unsettled law. Here, too, the non-discrimination principle latent in Erie explains how the Supreme Court can demand that federal courts adopt the predictive method, whatever a state supreme court has said about the matter.
The Article ends by briefly discussing the transformative effect that Erie’s non-discrimination principle should have for choice of law, where Swift v. Tyson remains ubiquitous.
RJE
March 28, 2011 | Permalink | Comments (0)
Wednesday, March 23, 2011
Judge Chin Rejects Google Books Settlement
Judge Chin (SDNY) rejected the settlement negotiated in the Google Books class action case. He worries that the settlement would be unfair to copyright owners and suggested that an opt-in format would be preferable to the current opt-out settlement.
The New York Law Journal covers the decision here. A copy of the proposed settlement is available here.
RJE
March 23, 2011 in Class Actions, In the News | Permalink | Comments (1)
Tuesday, March 22, 2011
Today's SCOTUS Decision in Matrixx Initiatives v. Siracusano: More on Pleading
Today the Supreme Court issued a unanimous opinion (per Justice Sotomayor) in Matrixx Initiatives, Inc. v. Siracusano (No. 09-1156), affirming the Ninth Circuit’s conclusion that the plaintiffs’ complaint adequately stated a claim for securities fraud. The Court rejects the arguments by the defendant Matrixx (manufacturer of the cold remedy Zicam) that “[plaintiffs’] complaint does not adequately allege that Matrixx made a material representation or omission or that it acted with scienter because the complaint does not allege that Matrixx knew of a statistically significant number of adverse events requiring disclosure.” [Slip Op. at 1.] Although the case involves securities-fraud claims in particular, the opinion contains several references to Twombly and Iqbal and may have a bearing on pleading standards more generally. Here's a quick summary:
The Court begins its discussion [Slip Op. at 3] by stating that the plaintiffs’ complaint “alleges the following facts, which the courts below properly assumed to be true. See Ashcroft v. Iqbal, 556 U. S. ___, ___ (2009).” It recounts over the next four pages events relevant to plaintiffs’ securities fraud claims.
Analyzing the issue of materiality, the Court states [Slip Op. at 17]: “Assuming the complaint’s allegations to be true, as we must, Matrixx received information that plausibly indicated a reliable causal link between Zicam and anosmia.” In footnote 12, the Court rejects Matrixx’s argument that certain studies relied on by the plaintiffs were unreliable with the following discussion:
Matrixx contends that Dr. Jafek and Linschoten’s study was not reliable because they did not sufficiently rule out the common cold as a cause for their patients’ anosmia. We note that the complaint alleges that, in one instance, a consumer who did not have a cold lost his sense of smell after using Zicam. More importantly, to survive a motion to dismiss, respondents need only allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U. S. 544, 570 (2007).
Here’s the Court’s conclusion on whether the complaint adequately pleaded the materiality requirement [Slip Op. at 18]:
We believe that these allegations suffice to “raise a reasonable expectation that discovery will reveal evidence” satisfying the materiality requirement, Bell Atlantic Corp. v. Twombly, 550 U. S. 544, 556 (2007), and to “allo[w] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged,” Iqbal, 556 U. S., at ___. The information provided to Matrixx by medical experts revealed a plausible causal relationship between Zicam Cold Remedy and anosmia. Consumers likely would have viewed the risk associated with Zicam (possible loss of smell) as substantially outweighing the benefit of using the product (alleviating cold symptoms), particularly in light of the existence of many alternative products on the market. Importantly, Zicam Cold Remedy allegedly accounted for 70 percent of Matrixx’s sales. Viewing the allegations of the complaint as a whole, the complaint alleges facts suggesting a significant risk to the commercial viability of Matrixx’s leading product.
As to whether the complaint adequately pleaded scienter, the Court uses the PSLRA’s heightened pleading standard, which requires a plaintiff to “state with particularity facts giving rise to a strong inference that the defendant acted with the required state of mind.” 15 U. S. C. § 78u–4(b)(2)(A). Citing Tellabs, the Court explains [Slip Op. at 20]:
This standard requires courts to take into account “plausible opposing inferences.” Tellabs, 551 U.S., at 323. A complaint adequately pleads scienter under the PSLRA “only if a reasonable person would deem the inference of scienter cogent and at least as compelling as any opposing inference one could draw from the facts alleged.” Id. at 324.
The Court holds [Slip Op. at 21] that “[t]he inference that Matrixx acted recklessly (or intentionally, for that matter) is at least as compelling, if not more compelling, than the inference that it simply thought the reports did not indicate anything meaningful about adverse reactions.” After summarizing the key allegations in the complaint, the Court concludes [Slip Op. at 22]:
These allegations, “taken collectively,” give rise to a “cogent and compelling” inference that Matrixx elected not to disclose the reports of adverse events not because it believed they were meaningless but because it understood their likely effect on the market. Tellabs, 551 U. S., at 323, 324. “[A] reasonable person” would deem the inference that Matrixx acted with deliberate recklessness (or even intent) “at least as compelling as any opposing inference one could draw from the facts alleged.” Id. at 324.
--A
March 22, 2011 in Recent Decisions, Supreme Court Cases, Twombly/Iqbal | Permalink | Comments (3)
Monday, March 21, 2011
Second Circuit Decision in Amnesty International v. Clapper: Plaintiffs Have Standing to Challenge Federal Wiretapping Procedures
Today’s opinion in Amnesty International v. Clapper (No. 09-4112-cv) begins:
Attorneys, journalists, and labor, legal, media, and human rights organizations brought this action facially challenging the constitutionality of Section 702 of the Foreign Intelligence Surveillance Act of 1978 (“FISA”), which was added to FISA by Section 101(a)(2) of the FISA Amendments Act of 2008 (the “FAA”), and codified at 50 U.S.C. § 1881a. Section 702 creates new procedures for authorizing government electronic surveillance targeting non-United States persons outside the United States for purposes of collecting foreign intelligence. The plaintiffs complain that the procedures violate the Fourth Amendment, the First Amendment, Article III of the Constitution, and the principle of separation of powers because they “allow[] the executive branch sweeping and virtually unregulated authority to monitor the international communications . . . of law-abiding U.S. citizens and residents.”
The merits of the plaintiffs’ claims are not before us. The only issue presented by this appeal is whether the plaintiffs are legally in a position to assert these claims in a federal court, not whether the claims are to any degree valid. Their merit is an issue for another court on another day. The district court (Koeltl, J.) granted the government summary judgment because it found that the plaintiffs lacked standing. On appeal, the plaintiffs argue that they have standing because the FAA’s new procedures cause them to fear that their communications will be monitored, and thus force them to undertake costly and burdensome measures to protect the confidentiality of international communications necessary to carrying out their jobs. Because standing may be based on a reasonable fear of future injury and costs incurred to avoid that injury, and the plaintiffs have established that they have a reasonable fear of injury and have incurred costs to avoid it, we agree that they have standing.
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March 21, 2011 in Recent Decisions, Standing | Permalink | Comments (0)
Decision of Interest: Eighth Circuit on CAFA and 1447(c)'s Remand Deadline
In a decision issued earlier this month, the Eighth Circuit considered the deadline for seeking a remand to state court based on the “Local Controversy” exception to jurisdiction under the Class Action Fairness Act (CAFA). See 28 U.S.C. § 1332(d)(4). The case is Graphic Communications v. CVS Caremark, No. 11-1067 (Mar. 11, 2011), 2011 WL 855672, 2011 U.S. App. LEXIS 4747. The defendant argued that the plaintiffs' remand motion, filed more than three months after removal to federal court, was untimely under 28 U.S.C. § 1447(c), which provides: “A motion to remand the case on the basis of any defect other than lack of subject matter jurisdiction must be made within 30 days after the filing of the notice of removal.”
The unanimous opinion, authored by Judge Kermit Edward Bye, reasoned that the Local Controversy exception “operates as an abstention doctrine, which does not divest the district court of subject matter jurisdiction.” But the court also held that the applicability of CAFA’s Local Controversy exception “was not a ‘defect’ within the meaning of section 1447(c).” Therefore, § 1447(c)’s 30-day deadline did not apply either.
So what is the deadline? The court explained: “[T]he mere fact that the statutory time limitation on raising motions to remand does not apply does not mean that non-1447(c) remands are necessarily authorized at any time. Indeed, we do not believe the applicable time limitation for the instant motion to remand is equivalent to the anytime-before-judgment (or even on appeal) standard applicable for subject matter jurisdiction.” Instead, a motion to remand based on the local controversy exception must be “brought within a reasonable time frame,” which is the standard “for remands not covered by § 1447(c).” The Eighth Circuit sent the case back to the district court to resolve whether the plaintiffs had filed their remand motion within a “reasonable time frame.”
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(Hat Tip: Scott Dodson)
March 21, 2011 in Class Actions, Recent Decisions, Subject Matter Jurisdiction | Permalink | Comments (0)
Lahav on Redish's Class Action Book
Alexandra Lahav (University of Connecticut) has posted Book Review: Are Class Actions Unconstitutional to SSRN.
Abstract:
This is a book review of Martin Redish, Wholesale Justice: Constitutional Democracy and the Problem of the Class Action Lawsuit (Stanford U. Press, 2009).
In Wholesale Justice, Redish argues that class actions are unconstitutional and must be significantly reformed. The argument he presents is one that will surely be debated in courtrooms as well as classrooms and is especially significant given that the Supreme Court is hearing four major class action cases in the October 2010 term. After summarizing Redish's arguments, the review demonstrates that class actions are both constitutional and consistent with ideals of democratic accountability. In the end, the question is not whether the class action is constitutional (it is) but whether class actions are socially beneficial. This is a policy issue, not a constitutional one. Nevertheless, a broader point in Redish's book deserves serious attention. Too often procedures and remedies stealthily prevent the vindication of substantive rights. The appropriate solution to this accountability problem is a more robust public discussion of the relationship between rights and remedies.
RJE
March 21, 2011 in Class Actions, Mass Torts, Recent Scholarship | Permalink | Comments (0)
Wednesday, March 16, 2011
Decision of Interest: Twombly/Iqbal and Affirmative Defenses
Last week Judge Jerome B. Simandle (U.S. District Court for the District of New Jersey) issued an opinion addressing whether the approach to pleading articulated by the Supreme Court in Twombly and Iqbal applies to the pleading of affirmative defenses. He concludes:
“This Court joins the two other Districts in this Circuit that have addressed this issue by holding that the heightened pleading standard of Twombly and Iqbal does not apply to affirmative defenses.”
The case is FTC v. Hope Now Modifications (No. 09-cv-1204), and the full opinion can be found on Justia and Pacer.
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March 16, 2011 in Recent Decisions, Twombly/Iqbal | Permalink | Comments (0)
Tuesday, March 15, 2011
Simard & Tidmarsh on Foreign Citizens in U.S. Class Actions
Professors Linda Sandstrom Simard (Suffolk) and Jay Tidmarsh (Notre Dame) have posted on SSRN a draft of their article Foreign Citizens in Transnational Class Actions, which will be published in the Cornell Law Review. Here's the abstract:
This Article addresses an increasingly important question: When, if ever, should foreign citizens be included as members of an American class action? The existing consensus holds that courts should exclude from class membership those foreign citizens whose country does not recognize an American class judgment. Our analysis begins by establishing that this consensus is flawed. Rather, to minimize the costs associated with relitigation in a foreign forum, we must distinguish between foreign claimants who are likely to commence a subsequent foreign proceeding from those who are unlikely to do so; distinguishing between those who come from recognizing and nonrecognizing countries creates needless inefficiency. Using standard tools of economic analysis, we examine the benefits and costs of the consensus rule and compare them to the costs and benefits of other possible rules. In this comparison, the consensus rule tends to perform poorly. As a matter of theory, the most efficient rule for deciding which foreign citizens to include and exclude is evident, but real-world informational constraints frustrate the application of this rule in practice. Because no rule regarding the inclusion and exclusion of foreign citizens is the most efficient in all situations, we propose that courts use rebuttable presumptions: include foreign citizens with claims that are not individually viable and exclude foreign citizens with claims that are viable.
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March 15, 2011 in Class Actions, International/Comparative Law, Recent Scholarship | Permalink | Comments (0)
Monday, March 14, 2011
More on SCOTUS Discussion of Pleading Standards in Last Week's Skinner Decision
We covered earlier the Supreme Court's discussion of federal pleading standards in its Skinner v. Switzer opinion, issued last week. Howard Wasserman has some additional commentary over at PrawfsBlawg in a post entitled "Some hints (or further confusion) about the state of pleading?"
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March 14, 2011 in Recent Decisions, Twombly/Iqbal, Weblogs | Permalink | Comments (0)
Rotunda on Compulsory Counterclaims in Bankruptcy Court
Ronald Rotunda (Chapman University) has posted Stern v. Marshall, and the Power of Bankrupcty Courts to Issue Final Orders On All Compulsory Counterclaims to SSRN.
Abstract:
Article III of the Constitution grants federal district judges, appellate court judges, and Supreme Court Justices important constitutional protections (lifetime tenure and no salary diminution) to guarantee their independence. However, the Supreme Court has allowed Congress to create, under Article I, a different class of judges (called "Article I judges"). These judges (such as tax court and bankruptcy court judges) do not have Article III protection and thus do not share Article III independence. Although we might think of Article I judges as administrative law hearing officers, they do exercise some judge-like powers. The extent of those powers raises fundamental questions because we do not want Congress to avoid the guarantees of Article III by simply shifting Article III powers to Article I judges.
In Stern v. Marshall, the Supreme Court will examine the scope of the power of Article I judges. For "core matters," bankruptcy judges have full power to enter final orders. For "non-core" matters, bankruptcy judges can only issue proposed orders, which Article III courts review de novo. Does the Constitution permit Article I judges to issue final orders simply because a claim is a compulsory counterclaim?
Stern v. Marshall involves the probate dispute between Anna Nicole Smith (former Playboy Playmate) and E. Pierce Marshall, the son of billionaire J. Howard Marshall. Smith’s claim in the bankruptcy court was that Pierce Marshall had tortiously interfered with his father’s oral promises to Smith. However, the probate court, after a jury trial, rejected that claim, before the Article III district court heard the issue. If this tort dispute is not a "core" matter, the probate court’s decision is collateral estoppel and bars Smith. If it is core simply because it is a compulsory counterclaim, then the bankruptcy court’s contrary decision supporting Smith is not merely proposed but final. Then, it governs because it came before the probate courts’ decision. This lengthy litigation (continuing for approximately 15 years, with both of the original parties now dead) has all the elements of a TV drama. However, the legal issues are quite serious. If the Court allows Article I courts to issue final orders simply because the rules of procedure designate a counterclaim as compulsory, that will greatly broaden the powers of Article I judges.
RJE
March 14, 2011 in Federal Courts, Federal Rules of Civil Procedure, Recent Scholarship | Permalink | Comments (1)
Friday, March 11, 2011
Witness Statements from Congressional Hearing on the Lawsuit Abuse Reduction Act
Statements from the three witnesses at today’s congressional hearing on H.R. 966 (covered earlier here) are now available. Here are the links:
Elizabeth A. Milito
NFIB Small Business Legal Center
Lonny Hoffman
University of Houston Law Center
Victor E. Schwartz
Shook, Hardy & Bacon L.L.P.
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March 11, 2011 in Current Affairs, Federal Rules of Civil Procedure, In the News | Permalink | Comments (0)
Thursday, March 10, 2011
Congressional Hearing On Legislation To Amend FRCP 11: The Lawsuit Abuse Reduction Act (H.R. 966)
The House Judiciary Committee’s Subcommittee on the Constitution is holding a hearing tomorrow (March 11th) at 10:00 a.m. on H.R. 966. The legislation is entitled the "Lawsuit Abuse Reduction Act of 2011," and its purposes include "[t]o amend Rule 11 of the Federal Rules of Civil Procedure to improve attorney accountability."
Information on the hearing is available here, and the text of the bill can be found here. Here is the witness list:
Elizabeth A. Milito
NFIB Small Business Legal Center
Professor Lonny Hoffman
University of Houston Law Center
Mr. Victor E. Schwartz
Shook, Hardy & Bacon L.L.P.
If you’re in D.C. and want to check it out, the location is 2141 Rayburn House Office Building.
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March 10, 2011 in Current Affairs, Federal Rules of Civil Procedure, In the News | Permalink | Comments (0)
Wednesday, March 9, 2011
Release of Federal Judiciary Caseload Statistics
The Administrative Office of the U.S. Courts has released its latest data (through 6/30/2010) on caseloads in the U.S. Courts of Appeals, District Courts, and Bankruptcy Courts. The statistical tables are available here.
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(Hat Tip: Blog of the Legal Times)
March 9, 2011 in Federal Courts | Permalink | Comments (0)
Tuesday, March 8, 2011
Campos and Erichson Debate the Future of Mass Torts on PENNumbra
PENNumbra, the online companion to the Penn Law Review is hosting a debate about the procedural future of mass torts between Sergio Campos (University of Miami) and Howard Erichson (Fordham University).
From Sergio's opening statement:
The evolving case law on aggregate litigation, based largely on notions of notice and due process (embodied in “day in court” principles), has been met with significant criticism on both sides by reformers who claim that the system is inherently unfair or encourages wasteful litigation.
In The Future of Mass Torts... And How to Stop It, Professor Sergio Campos argues for a change in course from the current treatment of mass torts. The current model of providing each individual plaintiff a “day in court,” he suggests, ultimately undermines plaintiffs’ interests by dividing the potential recovery—and thus the litigation incentives—among the plaintiffs while leaving the defendant with the full incentive to avoid litigation. Although the Supreme Court has recently upheld plaintiffs’ right to individual litigation, due process need not be inherently inflexible. By looking to older precedent, such as Mullane v. Central Hanover Bank & Trust Co., Campos supports a “compelled, collective ownership” of claims by procedures such as multi-district litigation or the mandatory class action. Although this model may infringe on “litigant autonomy,” Campos argues that this is ultimately necessary to best protect the interests of mass tort plaintiffs.
RJE
March 8, 2011 in Class Actions, Mass Torts, MDLs, Recent Scholarship | Permalink | Comments (0)