In re Zyprexa Products Liability Litigation, 04-MD-01596, Eastern District of New York, United States District Court (December 8, 2006).
In this case, the court dreamed a little dream on a solution to mass litigation before an MDL court. Defendant Eli Lily & Company removed approximately a 1/4 of the country’s Zyprexa (an anti psychotic drug often prescribed to schizophrenics, which I swear we have never taken) multi district litigation (MDL) docket. The plaintiffs filed a motion to remand over 2000 of those cases. The Court failed to get to the merits of the remand order, and, instead asked the parties for additional briefing on two issues: 1) The affect of recent statements by the FDA on the issue of federal preemption, and; 2) Whether Eli Lily was entitled to rely on federal preemption as a basis for removal when it did not refer to the issue in its removal pleadings.
You are probably asking at this point, what drugs were the CAFA Law Blog editors on when they selected this case for a post since it does not have anything to do with CAFA. We are not telling, but we will tell you why this case has implications for our CAFA readers. Even though Senior District Judge Jack B. Weinstein did not get to the merits of the removal issue in his decision, he went into some detail proposing a legislative solution to mass litigation before an MDL court.
Judge Weinstein described MDL cases, such as the Zyprexa litigation, as quasi-class actions. Judge Weinstein, citing other Zyprexa related decisions, noted that the Zyprexa litigation involves tens of thousands of claims being administered in state and federal courts. Most of the cases have been settled with the involvement of settlement masters. Millions of documents have been collected and made available to attorneys in all state and federal cases. All of these procedures would have been available in a class action case designed to minimize transactional costs.
Judge Weinstein further noted that a number of Supreme Court cases have reduced the effectiveness of the class action as a means of settling a mass conflict, citing Ortiz v. Fibreboard Corp., 527 U.S. 815, 119 S.Ct. 2295, 144 L.Ed.2d 715 (1999); Amchem Products Inc. v. Windsor, 521 U.S. 591, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997); Stephenson v. Dow Chemical Co., 273 F.3d 249 (2d Cir.2001), aff’d 4-4, Dow Chemical Co. v. Stephenson, 539 U.S. 111, 123 S.Ct. 2161, 156 L.Ed.2d 106 (2003). This development has lead a number of judges and attorneys to attempt mass settlement on a consolidated and cooperative basis without resorting to class action litigation. Judge Weinstein described the pitfalls in avoiding formal Rule 23 class actions. Among these pitfalls is the inability to reach full resolution in many litigation matters.
Judge Weinstein then proposed that a CAFA like solution could ameliorate the concurrent jurisdictional stumbling blocks facing mass litigation. CAFA is described as, “a good example of legislative efforts to allow mass national litigation to proceed on a consolidated basis in a single forum.” Judge Weinstein stated that “part of the legislative impetus for CAFA was the recognition that the resolution of some multi-state mass actions of national import was being hindered by concurrent adjudication in state and federal courts.” It was also noted that a similar impetus motivated Congress’ passage of the Securities Uniform Standards Act of 1998.
Judge Weinstein suggested that it may be useful for Congress to consider expanding the Class Action Fairness Act from class actions to at least some national MDL, non-Rule 23 aggregate actions. He noted that as the use of the class action device has become more difficult, MDL consolidation has increased in importance as a means of achieving final, global resolution of mass torts. Judge Weinstein concluded that many of the same concerns that animated CAFA’s preference for a single, federal forum apply to national MDL aggregate actions.
To learn more about Dream a Little Dream of Me, click here.