Monday, August 7, 2017
Bellwether trials are a mass tort phenomenon that is often reported in the media, but too often journalists put more emphasis on an individual trial or even a small set of trials than is warranted. This post tries to explain why more care and nuance is needed in reporting on these trials.
A bellwether is a kind of test trial, a vehicle for the judge and the parties to obtain information about a mass litigation in order to settle a large number of lawsuits at once. That settlement might happen through a settlement matrix, in groups as lawyers settle their "inventory" of cases, through a class action, or all three. Often cases where we see bellwether trials are MDLs -- multi-district litigation that has been transferred to a single federal judge for resolution. If you are a journalist writing about complex litigation, all this will be familiar to you.
Trial verdicts in bellwether cases seem like they should be big news. After all, if the case really is "representative" of the run of cases then the verdict should help us predict what will happen in settlement. It can help us understand what risks a company faces, for example.
The problem is, that bellwether trials will rarely tell you what the run of cases are like or how they will come out. This is true for several reasons. It is good to keep them in mind when you are reporting on bellwether trials:
1. Mass tort cases are often heterogenous. The bellwether trial is just one trial out of a larger, varied group. Even if everyone was injured by the same toxin or drug or product, they likely different injuries and different levels of injury. So picking one of them doesn't tell us much about the others. The same is true not only for the injury itself but for other elements of the legal claim, especially causation.
2. Bellwether cases are picked by the parties. The parties try to pick their best cases. For defendants this means cases they are likely to win; same for plaintiffs. So we would expect bellwether cases to be outliers. They do not necessarily reflect the run of cases. What do we (the public) know about the run of cases in the litigation? Often very little. The parties tend to know a lot, but they are not likely to share that information. We can assume that the cases are varied. See point #1.
3. The universe of cases is not always the universe of cases. This is because cases will settle. A defendant might decide that it is in its best interest to settle out the most high value cases, leaving low value cases to be tried. This might create the misleading appearance that the run of cases are very low value, and that there is little litigation exposure for the defendant. It is important to ask about what cases have been settled as well as what cases are tried.
4. The trial verdict is not the outcome. One reason is that cases will settle. For example, the parties may have reached a high-low settlement before trial, so that the defendants' payout has a ceiling above which it need not pay and the plaintiff has a floor, below which he or she will not lose. Another reason is that cases will be appealed. Or retried. Or the verdict remitted. Reports of high verdicts without nuance are shocking and exciting, but they misrepresent what really goes on in the justice system.
When you report on bellwether trials and there is an exciting verdict -- either because the defendant won or the plaintiff did -- I hope you will remember that while it is very interesting how the bellwether came out, it doesn't really tell us very much about the defendant's exposure.