By Gerald L. Maatman, Jr.
Duane Morris Takeaways: The Trial Lawyers of Mass Torts (TLMT) – an organization of plaintiffs’ class action lawyers – hosted their annual educational conference this week in Cabo, Mexico. TLMT invited Gerald L. Maatman, Jr. of Duane Morris, the co-author of the Annual Class Action Review, as one of the sole representatives of the class action defense bar to provide defendant-side perspectives on class action and mass tort litigation.
The TLMT brings together top practitioners on both sides of the bar as well as the judiciary to tackle contemporary issues in complex litigation, focusing on class actions and mass torts. The conference featured numerous prominent federal judges who handle leading MDL proceedings and class actions, including Judge Charles Breyer, Northern District of California, Judge Karen Caldwell, Eastern District of Kentucky, Judge Edward Chen, Northern District of California, Judge Vince Chhabria, Northern District of California, Judge Jacqueline Corley, Northern District of California, Judge James Donato, Northern District of California, Judge Nancy Rosenstengel, Southern District of Illinois, Judge David Proctor, Northern District of Alabama, Judge Richard Seeborg, Northern District of California, Judge Jane Milazzo, Eastern District of Louisiana, and Judge Joy Flowers Conti, Western District of Pennsylvania. In addition, Judges Amul Thapar and Rachel Bloomekatz of the U.S. Court of Appeals for the Sixth Circuit gave presentations.
The opening sessions focused on mass tort claims brought in MDL’s and cutting-edge class actions for data breaches and privacy violations.
I had the honor and privilege of speaking on the class action developments panel that included Judge Beth Freeman and Judge Rita Lin of the U.S. District Court of the Northern District of California and Judge Kenly Kiya Kato of the U.S. District Court for the Central District of California. Our panel addressed a wide variety of cutting-edge class action issues running the gamut from standing to settlements, and experts to arbitration.
Standing Issues
The requirement of a named plaintiff to possess legal standing often rears its head early on in a class action. The stakes can be high and case determinative, and also impact selection of forum considerations (e.g., where a motion to dismiss for lack of standing results in the remand of the class action to state court). The Judges further pointed out that standing can impact case management issues and the scope of discovery, which are important to companies due to the sheer size of class actions and the costs to defend them. Interestingly, the Judges opined that bifurcation of discovery into a class certification stage and a merits stage – while previously popular in the class action space – has largely fallen out of favor as a viable case management tool.
Settlements
Rule 23 requires courts to pass on and approve settlements. The Judges remarked that precertification settlements are more difficult to adjudicate but remain a viable exit ramp for many class actions.
The Judges agreed with my commentary on how the approach to settlement issues – especially for pre-certification settlements – is one of the most widely-varying areas from judge-to-judge and venue-to-venue in terms of judicial decision-making. Like buying real estate, “location, location, and location” means everything in terms of the way settlements are approached from a case law standpoint, which vary in state and federal courts and with respect to the pertinent case law in each location.
Experts & Certification
The Judges agreed that expert testimony is often the most crucial factor in the certification battle. The costs can be immense, but a win or loss on class certification can represent monetary exposure (or a lost opportunity) of substantial economic benefit (or loss). In sum, the stakes are exceedingly high and scrimping on expert fees may be short-sighted.
Arbitration
The Judges had interesting views on the interrelationship of arbitration and class action litigation. While the statistical findings of our Duane Morris Annual Class Action Review – 2024 demonstrate that corporate defendants won motions to compel arbitration (of class action claims on an individual basis) at a rate of 66% over the past year, nearly a third were denied – and often for a multitude of reasons. The Judges agreed on the high-stakes nature of such motions and how case-specific facts drive the extent to which discovery should be allowed on key factual and legal disputes over arbitration agreements. They also observed how mass arbitration has “weaponized” arbitration programs in certain situations where arbitration has virtually replaced Rule 23 as a method for adjudication of large-scale disputes or in situations involving hundreds or thousands of claimants.