Academic journal article Defense Counsel Journal

MDL Consolidation of Aviation Disaster Cases before and after Lexecon

Academic journal article Defense Counsel Journal

MDL Consolidation of Aviation Disaster Cases before and after Lexecon

Article excerpt

Pending legislation may restore the ability of transferee courts to retain cases for trial and possibly determination of damages

IN 1998, the U.S. Supreme Court decided Lexecon v. Milberg Weiss Bershad Hynes & Lerach,(1) holding that all actions transferred by the Multidistrict Litigation Panel, pursuant to 28 U.S.C. [sections] 1407, for consolidated pretrial proceedings must be remanded to the transferor courts at the conclusion of pretrial proceedings, unless settled or otherwise disposed of in the transferee court. Lexecon overturned nearly 30 years of precedent and invalidated a rule of procedure of the panel that allowed transferee courts to retain cases for consolidated liability trials after pretrial proceedings. This had been accomplished through a motion for self-transfer in the MDL court made pursuant to 28 U.S.C. [sections] 1404(a). Lexecon has ended self-transfer, at least temporarily, and courts are now obligated to remand remaining cases to transferor courts at the conclusion of pretrial proceedings.

What is the effect of Lexecon on aviation disaster litigation in the federal courts? One must begin with an overview of that litigation prior to 1968 for an examination of options faced by litigants seeking consolidation before Section 1407 was enacted, and as it exists, to some extent, after Lexecon, or until Congressional action nullifies the adverse impact of the decision.

CONSOLIDATION PRIOR TO 28 U.S.C. [sections] 1407

Under Rule 42(a) of the Federal Rules of Civil Procedure, federal courts have the power to consolidate cases "involving a common question of law or fact" pending in their own districts. Consolidation is permitted in appropriate cases in order to avoid unnecessary costs or delay in litigation.(2) It may be briefly noted that mass aviation disaster cases were rare until the 1950s and afterwards.(3)

With the rise of interstate commerce and transportation, the likelihood increased that related actions would be brought in more than one district. The doctrine of forum non conveniens, which the U.S. Supreme Court condoned in 1947 in Gulf Oil Corp. v. Gilbert,(4) provided a crude and uncertain procedural means to effect multidistrict consolidation. An action in one district could be dismissed, but on condition that it be recommenced in another district where a related action was pending.(5) The cases could then be consolidated under federal and local rules of procedure.

In 1948, Congress simplified procedures for transferring cases with 28 U.S.C. [sections] 1404, which provides: "For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought."

Section 1404 is similar to forum non conveniens, but because it allows transfer without the formality of first dismissing an action, the threshold for establishing inconvenience in the original forum is lower. Even so, Section 1404 provided, at best, an uncertain means of consolidating aviation accident cases commenced in different districts.

For one thing, as with forum non conveniens, there remained a strong presumption in favor of the chosen forum if the plaintiff (or the plaintiff's decedent) was a resident or had a domicile in that district. Moreover, the "public" and "private" interest factors used to determine the relative convenience of competing forums may not justify transfer in some cases. For example, consolidation may be convenient with respect to liability but not damage issues. Section 1404 also prohibits transfer to a district if any defendant is not subject to personal jurisdiction there.(6)

In short, assuming all defendants were subject to jurisdiction in the proposed transferee forum, the possibility of consolidating related cases was only one of several non-decisive factors that courts considered in deciding motions to transfer. …

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