Washington, D.C. – The Federal Advisory Committee on Civil Rules is seeking public comment on proposed Rule 16.1, which focuses on case management in multidistrict litigation (MDL) proceedings. The proposed rule aims to provide guidance for both parties and transferee courts regarding early case management in MDLs, including leadership appointments, information exchange, and other critical tasks that can impact the efficiency and cost of litigation.
Businesses and other interested parties have until February 16, 2024, to submit their comments on the proposed rule. As it currently stands, the proposed rule, drafted with permissive language, does not eliminate the existing uncertainty surrounding MDL processes and procedures, particularly in large-scale product liability and mass tort litigation.
MDLs are established when multiple lawsuits involve common factual questions. These proceedings, authorized by Congress through 28 USC ยง 1407, consolidate cases before a single district judge to streamline pretrial matters, including dispositive motions on common issues. MDLs can offer benefits by minimizing duplicative discovery orders, establishing trial schedules, and centralizing proceedings. However, shortcomings exist, such as the lack of clear rules for transferee courts and parties to follow.
The absence of standardized procedural rules in MDL proceedings often leads to unintended consequences, like the limited ability to identify weaker cases early on and increased leverage for plaintiffs who pool resources. This situation is particularly burdensome for smaller defendants named in only a few dozen cases out of thousands, as the expenses associated with MDL litigation can far outweigh the benefits of consolidation.
In response to these challenges, the Federal Advisory Committee on Civil Rules has invited public comment on a proposed amendment to the Federal Rules of Civil Procedure that specifically addresses case management in MDL proceedings. The proposed Rule 16.1, which would supplement Rule 16, seeks to provide targeted guidance for MDLs.
Key elements of the proposed rule include scheduling an initial management conference after the creation of the MDL and mandating the preparation and submission of a report by the parties. This report would address several crucial matters, including information exchange, proposed discovery plans, the appointment and role of leadership counsel, and potential alternative dispute resolution. Additionally, the proposed rule allows for the appointment of coordinating counsel to assist with conferences and the creation of an initial MDL management order to guide subsequent proceedings.
However, one notable aspect of the proposed Rule 16.1 is its frequent use of the permissive term “should” instead of more definitive language like “shall” or “must.” While this flexibility may account for the unique nature of each MDL, it also raises concerns about the potential lack of uniformity and certainty in the process. The proposed rule does not establish clear limits or standards for district judges to follow.
Moreover, the rule’s suggestion to prioritize early settlement and alternative dispute resolution could be seen as assuming the merit of claims and implicitly biasing against defendants. Some argue that courts should focus on adjudicating claims and evaluating their merits rather than venturing into settlement negotiations. Further, the rule’s provision authorizing the appointment of leadership counsel with decision-making authority raises questions about due process.
While the proposed rule has drawbacks, it opens the door to incorporating much-needed guidance for MDLs into the Federal Rules of Civil Procedure. However, it must strike a balance between providing clear direction and avoiding unnecessary involvement in settlement negotiations or favoring one side over the other. The proposed rule’s permissive language and limited scope may not fully address the issue of mass filings of meritless claims, which could be better addressed through procedural mechanisms that allow for early claim examination.
The public comment period for proposed Rule 16.1 will conclude on February 16, 2024. Despite any potential changes, the final rule is not expected to take effect until 2025. Legal professionals will monitor developments closely and provide updates as warranted.