One Man’s Trash . . . Whitton v. Defenbaugh, et al.

In an interesting opinion, United States District Judge Carlos Murguia disposed of Defendant Defenbaugh Disposal, Inc.’s Motion for Reconsideration which questioned compatibility of the District Court’s order certifying a class of consumers charged an “environmental/fuel charge” and an “administrative fee,” and a concurrent order denying summary judgment against the sole putative class representative based on the voluntary payment doctrine.  Defenbaugh naturally questioned, among other less ripe issues, how the District Court could junk their summary judgment motion against Whitton as being too “heavily fact-dependent” to adjudicate at the summary judgment stage while concurrently certifying a class action.  In his order denying reconsideration, Judge Murguia defended his orders as compatible because the summary judgment issue was decided only with respect to the putative class representative, Mr. Whitton, “meaning that only Mr. Whitton’s actions or knowledge were relevant to defendants’ motion for summary judgment,” while “predominance is analyzed in terms of all proposed plaintiffs – not just named-plaintiff Whitton.”

This is certainly true, but the logic smells fishy.  The very definition of a class action, as a representative action, means that the actual claims of the absent class members will not be before the court, and that their claims must necessarily be adjudicated only through the prism of the named class representative.  If the only class representative proffered is subject to uniquely problematic fact-laden defenses that don’t really apply to the rest of the class so as to create a predominance issue, is that class representative truly typical or even adequate?  And how can predominance be assumed when the claims of the one proposed class representative raise such fact-dependent individualized defenses?  In the end, the differing standards for granting summary judgment and certifying a class don’t appear to explain how the claims of a proposed class representative can be sufficiently individually fact-specific so as to preclude summary judgment on a dispositive defense, yet allow resolution of the class claims through the trial of that one peculiar individual’s claim.  And if the District Court’s analysis is accurate – that only the class representative but not the absent class members may be subject to this individualized defense – is it fair to allow the claims of the absent class members to get trashed because the class representative is such a peculiarly vulnerable standard-bearer?

    “There Are 5,000 Stories to Tell”: Western District of Missouri Rejects Bid to Certify Power-and-Light Discrimination Class

    Emphasizing the individualized nature of each putative class member’s experience, Judge Ortrie Smith denied the plaintiffs’ motion for class certification in Combs v. The Cordish Companies et al., No. 14-0227, 2015 WL 438154 (W.D. Mo. Feb. 3, 2015).

    Alleging that the defendants unlawfully limited their access to Kansas City’s popular Power and Light District, the plaintiffs brought suit under 42 U.S.C. § 1981 and sought to certify a class comprised of all persons of African-American descent who were “excluded, ejected, harassed, or suffered other discriminatory treatment” at the hands of the defendants. In denying class certification, Judge Smith homed in on the need for detailed and individual factual inquiries. In particular, he focused on the fact that putative class members would have to prove more than that the defendants intended to discriminate against them – they would also have to demonstrate that they were in fact victims of discrimination. This, according to Judge Smith, “requires an individualized examination of the circumstances surrounding each and every ejection” and defeats a finding of predominance.

    For example, each of the estimated 5,000 putative class members may have to testify about their particular harassment, wrote Judge Smith. And even if each person were to testify for only an hour, this would require 625 trial days – a figure that would likely be far greater, given that the defendants would be entitled to present their own witnesses as well. “It will literally take years to resolve these individualized issues, which means the common issues do not predominate over the individual issues.”

    Although cognizant that the community as a whole may have been harmed by the defendants’ conduct, Judge Smith noted that such an observation does not mean that class certification is permitted under Rule 23: “There are 5,000 stories to tell, not one – and therein lies the difference between a permissible class action and what Plaintiffs propose.”

      Close Enough For Remand: Hood v. Gilster-Mary Lee Corp., 2015 WL 328499 (W.D. Mo., Jan 26, 2015)

      How does one prove the citizenship of members of the putative class for purposes of applying CAFA’s jurisdictional exceptions?  For instance, the Local Controversy Exception under 28 U.S.C. Section 1332(d)(4) requires the federal district court to decline to exercise CAFA jurisdiction if (among other requirements) two-thirds of the putative class members are citizens of the state in which the action was originally filed.  But since absent class members are typically absent, how do you know?

      This issue popped up before Judge Harpool when the defendant which operated a microwave popcorn packaging plant in Jasper Missouri used CAFA to remove yet another diacetyl class.  While it is well-settled that the party seeking remand must prove the application of one of CAFA’s exceptions, this is easier said than done.

      Rather than apply strict proof, the district court elected to rely on “common sense” and “logic.”  Although only 41% of the class actually confirmed Missouri citizenship, the district court found more than a kernel of truth in caselaw creating a rebuttable presumption that the state of residency is also the state of citizenship for absent class members.  And although the putative class stretched back to workers from 2008 forward, plaintiffs had it in the bag once they produced “representative data” indicating that the vast majority of putative class members had last-known addresses in Missouri.  Because actual proof of citizenship would be “impossible,” the district court settled for representative data.

      In deciding to remand the case, the district court specifically rejected cases from other jurisdictions declining to base citizenship analysis on last known address data, and distinguished this type of industrial exposure case from other cases, such as cell phone cases, where mailing addresses and phone numbers may not be representative of citizenship.  Between this and the Cape Cod Potato Chip decision, it’s been a starchy salty week for the Western District.

       

       

        Down With the Chips When the Chips Are Down: Kelly v. Cape Cod Potato Chip Company, Inc.

        In a recent decision from the United States District Court for the Western District of Missouri, Judge Whipple demonstrated that he is indeed “down with the chips” when it’s crunch time by granting Defendants’ 12(b)(1) and 12(b)(6) motion to dismiss the putative class claims asserted under the MMPA against Cape Code Potato Chip Company, Inc. and Snyder’s-Lance, Inc.    In her complaint, the class representative alleged that the sale of these tasty snacks violated the MMPA because they were falsely labeled as “all natural” and containing “no preservatives.”  As you may recall, a valid MMPA claim requires the plaintiff to allege: 1) the purchase of merchandise from the defendant; 2) for personal, family, or household purposes; and 3) ascertainable loss of money or property; 4) as a result of a practice proscribed by section 407.025.1 of the MMPA.

        After sinking his teeth into Defendants’ motion, Judge Whipple may have Ruffled a few feathers when he agreed that the Plaintiff had failed to allege any unlawful marketing practice as defined by the MMPA, which includes “any deception, fraud, false pretenses, false promise, misrepresentation, unfair practice or the concealment, suppression or omission of any material fact.”  First, Judge Whipple found that Plaintiff had failed to provide any plausible or applicable definition of the term “natural,”  and therefore failed to allege that the use of that term in the packaging and marketing of the offending chips was deceptive or misleading under the MMPA.  In doing so, Judge Whipple had to grapple with an issue other courts have had to address – the lack of standardized definitions and standards for marketing terms such as these.  Judge Whipple rejected any application of the Merriam-Webster definition of natural (defined as “existing or produced in nature”) as clearly inapplicable, as potato chips do not occur in nature, which is indeed a pity.  He then noted that the FDA has (quite unhelpfully in the author’s view) thus far declined to adopt any formal definition of the term “natural.”   Finally, Judge Whipple rejected the application of other possible benchmarks from the USDA or FDA as inapplicable to food destined for human consumption such as potato chips.  Absent a standard by which the term “natural” could be adjudged either true or false, Judge Whipple naturally found Plaintiff failed to plead any unfair trade practice by the use of that claim.  In addition, the Court found that the full disclosure of the ingredients on the federal-complaint label as a matter of law defeated any claim that consumers had been deceived as to the ingredients contained in the package.

        For the second course, Judge Whipple concluded that the Plaintiff also lacked Article III standing to assert claims for injunctive relief and claims based on the purchase of varieties of chips she had never purchased.  Because Plaintiff had alleged in the class complaint that she would never have purchased these chips had she known the “true nature” of these chips as an “unnatural” and “inferior” product, the Court necessarily found that she was unlikely to purchase them again.  Because few people like purchasing inferior and unnatural products, Judge Whipple found no likelihood of future injury, and therefore no standing to pursue injunctive relief requiring Cape Cod Chips to cease deceptively selling its chips and to truthfully represent them to her.  And while Plaintiff argued that as a putative class representative she had standing to assert the claims of unnamed class members who had purchased the twelve varieties of ships she had not purchased, Judge Whipple didn’t bite.  Because the class representative must have personally standing to bring the class claims, he concluded that she could not maintain an action on behalf of other class members for the purchase of flavors of chips she didn’t purchase.

        This brief but salty order has some real nutritional value.  First, it tells us that absent an applicable definition of the standard or term claimed to have been falsely represented, it’s hard to show it was misrepresented as an unfair practice under the MMPA.  Second, full disclosure of the ingredients on the label crunches any potential claims based on consumers misunderstanding the ingredients.  Finally, there’s no Article III standing in consumer classes for products the class representative didn’t purchase, and no standing to enjoin the future sale of a product which you have pleaded you wouldn’t buy again anyway.   We’ll keep an eye on this case in the event Plaintiff a-peels.

         

         

          Eighth Circuit rips district court for failing to rigorously analyze class requirements

          On January 13, 2014, the Eighth Circuit overturned, on interlocutory appeal pursuant to Fed. R. Civ. P. 23(f), a district court’s order certifying four classes of Nebraska consumers, who alleged that Credit Management Services Inc. (“CMS”) and its in-house counsel violated the Fair Debt Collection Practices Act. This is notable not only for the fact that the Eighth Circuit granted review. Writing for the panel, Judge Loken revoked the district court’s certification order, finding that the district court abused its discretion in certifying the class without conducing a “rigorous analysis . . . of what the parties move prove” and that Rule 23 requires.

          The plaintiffs alleged that CMS and four in-house lawyers violated the FDCPA, by sending standard-form collection complaints and discovery requests. Plaintiffs alleged that the standard-form pleadings violated various provisions of the FDCPA, making them unfair or deceptive or practices that also violate Nebraska consumer protection laws.

          The court started its analysis by noting that a preliminary inquiry at the class certification stage may require the district court to resolve factual disputes, even when the disputes overlap with the merits of the case.  Thus, class certification was only appropriate here if the standard-form complaints and discovery requests that CMS sent to putative class members were violative of the FDCPA and Nebraska consumer protection laws “on their face,” as the plaintiffs had alleged.  The district court erred, the court said, when it concluded that the predominant common question was whether the defendants sent each putative class member a standard-form complaint and discovery request, which violated the FDCPA and Nebraska law.  Rather, the court failed to conduct a “rigorous analysis” of what the plaintiffs must prove in order to prevail on their facial invalidity theories, the panel said. “Our task, then, is to fill this void which requires separate analyses of the legal theories attacking the standard form complaints and discovery requests.”

          The court noted that it had recently “surveyed the complex question of FDCPA liability for litigation activities in a non-class action” and found that a debt collector’s fact allegations in state court are not false and misleading, in violation of the FDCPA, simply because the claims were not adequately supported in the collection action.  Instead, this analysis depends on a number of particularized factors.  In the class certification context, however, “these complexities—ignored by the plaintiffs and not addressed by the district court—are highly relevant to a rigorous analysis of the well-traveled Rule 23 inquiries into commonality, typicality, adequate representation of the class, predominance, and superiority.”

          The court went on to explain that two scenarios were possible. First, if plaintiffs’ theory of liability proved wrong under the FDCPA and Nebraska law, then plaintiffs would lose on the theory attacking the standard-form complaints, and prompt resolution on summary judgment motions would have obviated the need for class certification.  Second, if plaintiff’s theory of state law was correct, many individualized issues would be required in order to solve class members’ claims.  As a result, the court held, the “records pertaining to every state court collection suit must be reviewed. . . .”

          Finally, the panel ruled that the district court erred in ruling that plaintiffs’ separate claims against the in-house lawyers did not affect class certification.  The court noted that (1) only one in-house lawyer singed the standard-form pleadings, and that (2) these “debt-ridden young lawyers” have little net worth.  The court indicated that the class members may have had a stronger claim against the individual attorney who actually singed the pleadings in that consumer’s collection lawsuit.  “Thus, by alleging that impecunious individual defendants are jointly and severally liable to all members of the largest possible classes, plaintiffs created an issue of class action superiority that cannot be ignored at the class certification stage.”

          Some helpful takeaways for federal court practitioners: At the class certification stage, raising only a few “common questions” is not enough to certify a class, particularly when the answers to those common questions do not generate common answers capable of resolving the litigation.   In addition, where individual issues appear, it may be necessary for the court to resolve factual disputes at or before the class certification stage, even though they overlap the merits of the case.  As was shown in the Powers decision, often times those individualized inquires make class certification untenable.

           

           

            Dart hits bullseye, SCOTUS throws out evidentiary requirement in notice of removal

            The United States Supreme Court held on Monday that a defendant seeking removal under CAFA need only allege the jurisdictional amount in its notice of removal.  Gone are the days when a defendant must quickly muster an affidavit or other evidence to include in a notice of removal to prove the jurisdictional amount-in-controversy under CAFA.

            This case began when the District of Kansas remanded back to state court a class action concerning allegedly deficient royalty payments.  See Owens v. Dart Cherokee Basin Operating Co., No. 12-4157, 2013 WL 2237740 (D. Kan. May 21, 2013).  (We covered the history of this case here and here).  In Dart’s removal papers, it stated that the three requirements of CAFA had been met, and more specifically with regard to the amount-in-controversy, Dart stated the putative class members’ claims totaled more than $8.2 million.  Owens moved to remand the case to state court, asserting that Dart’s removal was deficient as a matter of law because it did not include evidence proving the amount-in-controversy exceeded $5 million.  In opposing Owens’s motion to remand, Dart submitted a declaration by one of its executive officers, who estimated the amount-in-controversy to be in excess of $11 million dollars.  Importantly, Owens did not challenge Dart’s submission.  Nonetheless, the district court granted Owens’s motion to remand, finding that under binding Tenth Circuit precedent, evidence outside of the petition and notice of removal is not permitted to determine the amount-in-controversy.  The district court also erroneously based its decision, in part, on a purported “presumption” against removal.

            The Court vacated the Tenth Circuit’s decision and remanded the case for further proceedings.  In so holding, the Court held that a defendant seeking to remove a case to federal court must only file a notice of removal that contains “a short and plain statement of the grounds for removal.”  The Court further noted that the party seeking to invoke federal court jurisdiction is responsible for establishing the amount-in-controversy.  Relying on the Federal Courts Jurisdiction and Venue Clarification Act of 2011, the Court explained the procedure for when a plaintiff challenges the defendant’s assertion of the amount-in-controversy:

            [D]efendants do not need to prove to a legal certainty that the amount in controversy requirement has been met.  Rather, defendants may simply allege or assert that the jurisdictional threshold has been met.  Discovery may be taken with regard to that question.  In case of a dispute, the district court must make  findings of jurisdictional fact to which the preponderance standard applies.

            Finally, the Court held that there is no anti-removal presumption for cases invoking CAFA, which “Congress enacted to facilitate adjudication of certain class actions in federal court.”

            In practice, this decision means that in most cases, a short and sweet allegation that the amount-in-controversy has been met in the notice of removal is sufficient.  The evidentiary proofs regarding the amount-in-controversy will come later, once the case is in federal court and the defendant is opposing plaintiff’s motion to remand.

              Rule 68 offers in the 8th & 10th Circuits

              Yesterday, the 11th Circuit held that a putative class representative’s claim is not mooted by an unaccepted Rule 68 offer of judgment.  See Stein v. Buccaneers LP, No. 13-15417 (11th Cir. Dec. 1, 2014).

              Just in time for the holidays, here’s a summary of the Rule 68 legal landscape in the 8th and 10th Circuits:

              8th Circuit.  There’s no Eighth Circuit decision squarely on point.  The district courts have reached opposite conclusions:

              • Goans Acquisition, Inc. v. Merchant Solutions, LLC, 2013 WL 5408460 (W.D. Mo. Sept. 26, 2013) (following the 7th Circuit’s decision in Damasco)
              • March v. Medicredit, Inc., 2013 WL 6265070 (E.D. Mo. Dec 04, 2013) (finding that pre-certification offer does not moot a named plaintiff’s claim);
              • Sandusky Wellness Center, LLC v. Medtox Scientific, Inc., 2013 WL 3771397, at *2 (D. Minn. July 18, 2013) (same);
              • Jenkins v. General Collection Co., 246 F.R.D. 600, 602–03 (D. Neb. 2007) (same);
              • Liles v. Am. Corrective Counseling Servs., Inc., 201 F.R.D. 452, 455 (S.D. Iowa 2001) (same).

              10th Circuit.  A Rule 68 offer won’t moot the claim of a named plaintiff who “timely” seeks class certification.  See Lucero v. Bureau of Collection Recovery, Inc., 639 F.3d 1239, 1250 (10th Cir. 2011) (“[A] named plaintiff in a proposed class action for monetary relief may proceed to seek timely class certification where an unaccepted offer of judgment is tendered in satisfaction of the plaintiff’s individual claim before the court can reasonably be expected to rule on the class certification motion.”).

                MO Supreme Court strikes down punitive-damages cap

                Since 2005, Missouri has statutorily limited punitive damage awards to the greater of $500,000 or five times the net amount of the judgment awarded to plaintiff.  See Mo. Rev. Stat. 510.265.

                In September 2014, however, the Missouri Supreme Court in Lewellen v. Franklin, 441 S.W.3d 136 (Mo. 2014) held that this punitive-damages cap violates a plaintiff’s constitutional right to a trial by jury.

                The Court’s analysis was straightforward:

                1. Any change in the right to a jury determination of damages as it existed in 1820 violates the Missouri Constitution.
                2. In 1820, there existed a right to a jury determination of the amount of punitive damages.
                3. A statutory cap on punitive damages “necessarily changes and impairs” that right.
                4. Therefore, the punitive-damages cap under Mo. Rev. Stat. 510.265 is unconstitutional.

                The Court also distinguished between Missouri’s statutory punitive-damages cap and the US Constitution’s Due Process limitations on punitive damages, noting that courts have a duty to conduct a fact-specific inquiry under the Due Process clause (which trumps the Missouri Constitution under the Supremacy Clause) to prevent grossly excessive or arbitrary awards.  A statutory cap, on the other hand, is not based on the facts of a case; it caps the punitive damages award regardless of the facts and circumstances of a particular case.

                  Top reasons the JPML has denied centralization of products liability and sales/marketing cases

                  Since May 2011, here are the most-cited reasons the JPML has denied Section 1407 centralization of products liability and sales/marketing cases:

                  The limited number of parties and involved counsel make informal cooperation practicable and preferable to formal centralization.

                  • MDL 2509 – IN RE: SEMPRIS MEMBERSHIP PROGRAM MARKETING AND SALES PRACTICES LITIGATION, 2/18/14 Order Denying Transfer (“Various mechanisms are available to minimize or eliminate the possibility of duplicative discovery even without an MDL.  In these circumstances, informal cooperation among the relatively few involved counsel and coordination among the involved courts are, in our judgment, preferable to formal centralization.”)
                  • MDL 2366 – IN RE: LOUISIANA-PACIFIC CORP. TRIMBOARD SIDING MARKETING, SALES PRACTICES AND PRODUCTS LIABILITY LITIGATION, 6/11/12 Order Denying Transfer (denying transfer of five actions, in part, because “plaintiffs in some of the actions share counsel, and defendant is represented by the same counsel in all actions”)
                  • MDL 2340 – IN RE: FRESH DAIRY PRODUCTS ANTITRUST LITIGATION, 4/17/12 Order Denying Transfer (“Plaintiffs in the consolidated actions share counsel, and at least some defendants (including, for example, National Milk Producers Association and Dairy Farmers of America, Inc.) are represented by the same law firms in both movants’ action and the consolidated actions.  Given the limited number of actions, we believe that informal cooperation among the involved attorneys is quite practicable.”)
                  • MDL 2310 – IN RE: TRILEGIANT MEMBERSHIP PROGRAM MARKETING AND SALES PRACTICES LITIGATION, 12/9/11 Order Denying Transfer (denying centralization of six actions, in part, because “[t]he relatively few involved counsel also weighs against centralization, and should facilitate informal coordination and cooperation across the actions”)
                  • MDL 2300 – IN RE: PLAVIX PRODUCTS LIABILITY LITIGATION, 12/14/11 Order Denying Transfer (denying centralization of 12 actions, in part, due to the “limited number of actions and relatively few involved counsel”)
                  • MDL 2237 – IN RE: CHILEAN NITRATE PRODUCTS LIABILITY LITIGATION, 5/20/11 Order Denying Transfer (denying centralization of two actions, in part, because “plaintiffs in both actions are represented by one law firm, and another law firm represents SQMNA in both actions.  In these circumstances, informal cooperation among the involved attorneys is both practicable and preferable.  . . .  [Defendant] represents that it has already offered to coordinate discovery, and that it is agreeable to the use of depositions of its witnesses in both actions.”)
                  • MDL 2230 – IN RE: QUAKER OATS TRANS-FAT MARKETING AND SALES PRACTICES LITIGATION (denying centralization 4/8/11) (noting that the litigation involves a single defendant and one firm represents the plaintiffs in 4 of 5 actions)
                  • MDL ____ – In re: Boehringer Ingelheim Pharm., Inc., Fair Labor Standards Act Litig., 763 F. Supp. 2d 1377, 1378-79 (J.P.M.L. 2011) (denying centralization of four actions in which plaintiffs in three actions shared counsel and, in all actions, the common defendant was represented by the same law firm, concluding that “alternatives to formal centralization, such as voluntary cooperation among the few involved counsel and courts, appear[ed] viable”).
                  • MDL _____ – In re Rite Aid Corp. Wage and Hour Emp’t Practices Litig., 655 F. Supp. 2d 1376, 1377 (J.P.M.L. 2009) (denying centralization where plaintiffs in four of six actions shared counsel)

                  Common factual questions are not sufficiently complex or numerous.

                  • MDL 2456 – IN RE: KASHI COMPANY MARKETING AND SALES PRACTICES LITIGATION, 8/6/13 Order Denying Transfer (noting that JPML has repeatedly concluded that common factual questions are not sufficiently complex or numerous in food product sales and marketing litigation)
                  • MDL 2392 – IN RE: WAGGIN’ TRAIN CHICKEN JERKY PET TREAT PRODUCTS LIABILITY LITIGATION, 9/28/12 Order Denying Transfer (“Although all actions share some factual issues regarding whether chicken jerky dog treats were contaminated by a common source in China, we are unconvinced, on the record before us, that those issues are sufficiently complex or numerous to warrant the creation of an MDL.”)
                  • MDL 2374 – IN RE: HONEY PRODUCTION MARKETING AND SALES PRACTICES LITIGATION, 8/2/12 Order Denying Transfer (“Although the actions share some common factual questions regarding the filtration of pollen from honey products, these questions do not appear sufficiently complex or numerous to justify Section 1407 transfer at this time.”)
                  • MDL 2348 – IN RE: CREST SENSITIVITY TREATMENT & PROTECTION TOOTHPASTE MARKETING AND SALES PRACTICES LITIGATION, 6/11/12 Order Denying Transfer (“Although the three actions share some factual issues regarding whether P&G deceptively marketed its Crest Sensitivity Treatment and Protection toothpaste,1 we are unconvinced, on the record before us, that those issues are sufficiently complex to warrant the creation of an MDL.”)
                  • MDL 2310 – IN RE: TRILEGIANT MEMBERSHIP PROGRAM MARKETING AND SALES PRACTICES LITIGATION, 12/9/11 Order Denying Transfer (denying centralization of six actions, in part, because “[t]he movants have not convinced us that any common factual questions are sufficiently complex or numerous to justify Section 1407 transfer at this time.  . . .   Although all actions contain allegations of the same basic scheme concerning post–transaction internet marketing and enrollment in membership programs, the differences among the actions will reduce any efficiencies to be gained from centralization. Plaintiffs’ motion encompasses cases against different defendants and alleging varied RICO enterprises. Much of the pretrial proceedings, therefore, likely will vary across the actions, including discovery targeted to the unique defendants in each action and issues, such as arbitration agreements, specific to those defendants.”)
                  • MDL 2306 – IN RE: SKINNYGIRL MARGARITA BEVERAGE MARKETING AND SALES PRACTICES LITIGATION, 12/14/11 Order Denying Transfer (denying centralization of six actions, in part, because “[t]hese putative nationwide class actions may share some factual questions regarding the defendants’ marketing practices, but the central allegation that Skinnygirl Margarita beverage was marketed as being all natural despite some level of sodium benzoate appears to be undisputed, and plaintiffs have failed to detail how pretrial proceedings would benefit from centralization. Consequently, the common material disputed facts may be limited in number.”)
                  • MDL 2248 – IN RE: NUTELLA MARKETING AND SALES PRACTICES LITIGATION, 8/16/11 Order Denying Transfer (“The actions may share some factual questions regarding the common defendant’s marketing practices, but these questions do not appear complicated.  Indeed, the parties have not convinced us that any common factual questions are sufficiently complex or numerous to justify Section 1407 transfer at this time. Cooperation among the parties and deference among the courts should minimize the possibility of duplicative discovery and inconsistent pretrial rulings.”) (citing In re: General Mills, Inc., Yoplus Yogurt Prods. Mktg. and Sales Practices Litig., 716 F. Supp. 2d 1371 (J.P.M.L. 2010) (denying motion for centralization of four actions pending in four districts); In re: DirectBuy, Inc., Mktg. and Sales Practices Litig., 682 F. Supp. 2d 1349, 1351 (J.P.M.L. 2010) (same))
                  • MDL ___ – In re AriZona Beverage Co. Products Mktg. and Sales Practices Litig., 609 F. Supp. 2d 1369 (J.P.M.L. 2009).

                  The actions involve dissimilar legal or factual issues.

                  • MDL 2544 – IN RE: HEALTHEXTRAS INSURANCE MARKETING AND SALES PRACTICES LITIGATION, 6/6/14 Order Denying Transfer (key legal issue is whether insurance policies were issued properly under state law, and the relevant state laws vary)
                  • MDL 2453 – IN RE: ADDERALL XR MARKETING, SALES PRACTICES AND ANTITRUST LITIGATION, 8/6/13 Order Denying Transfer (denying transfer because the three putative statewide classes do not overlap and the claims are based on different state antitrust and consumer-protection laws; therefore, low likelihood of conflicting pretrial rulings)
                  • MDL 2447 – IN RE: MAYBELLINE NEW YORK AND L’ORÉAL PARIS COSMETIC PRODUCTS MARKETING AND SALES PRACTICES LITIGATION, 6/6/13 Order Denying Transfer (“Although all four actions involve allegations that defendants’ lip products do not remain on wearers’ lips for the durations advertised, those products are not the same across all actions. In the Southern District of New York and Northern District of Californian actions, the involved lip products are Maybelline’s SuperStay 10HR Stain Gloss and SuperStay 14HR Lipstick. In the Southern District of California and Eastern District of California actions, the involved product is SuperStay 24HR Lip Color. In addition, two of the actions implicate products not found in any other action. Specifically, the Northern District of California action involves allegations concerning certain mascara products, and the Eastern District of California action involves allegations concerning a foundation product.”)
                  • MDL 2374 – IN RE: HONEY PRODUCTION MARKETING AND SALES PRACTICES LITIGATION, 8/2/12 Order Denying Transfer (“In contrast, the differences among the actions are both significant and numerous. The actions involve different defendants, marketing different honey products, and involve different state regulations subject to different legal challenges by the defendants. Plaintiffs have not alleged any conspiracy, collaboration, or other industry-wide conduct by the defendants that would justify centralizing actions naming different honey retailers and producers as defendants.”)
                  • MDL 2339 – IN RE: TEAMSTER CAR HAULER PRODUCT LIABILITY LITIGATION, 4/17/12 Order Denying Transfer (denying centralization of eleven personal-injury actions involving allegedly defective trailers, in part, because “the defects alleged and injuries suffered vary among these actions, and various additional defendants are named based on different theories of liability”)
                  • MDL 2321 – IN RE: YELLOW BRASS PLUMBING COMPONENT PRODUCTS LIABILITY LITIGATION, 2/9/12 Order Denying Transfer (denying centralization of 13 actions involving brass plumbing component, in part, because “the dissimilarity of numerous claims convince us that the significant inconvenience to the parties and practical case management challenges presented by centralization outweigh its benefits”)
                  • MDL 2306 – IN RE: SKINNYGIRL MARGARITA BEVERAGE MARKETING AND SALES PRACTICES LITIGATION, 12/14/11 Order Denying Transfer (denying centralization of six actions; “centralization may not prevent either conflicting or multiple rulings, because plaintiffs bring their claims under the laws of different states. Under some state laws, the state of mind or reliance by individual purchasers may be a critical factor; in others it may not. These issues would not involve common discovery.”)

                  Alternatives to centralization are preferable (e.g., 1404 transfer; dismissal or stay under the first-to-file doctrine; agreement to voluntarily dismiss actions in favor of one district, etc.)

                  • Centralization under Section 1407 “should be the last solution after considered review of all other options.”  In re Best Buy Co., Inc., California Song-Beverly Credit Card Act Litig., 804 F. Supp. 2d 1376, 1378 (J.P.M.L. 2011).  These other options include “Section 1404 transfer; dismissal or stay under the first-to-file doctrine; agreement by plaintiffs to voluntarily dismiss their actions in favor of one district; and cooperation and coordination among the parties and the various transferor courts.”  See MDL 2397 – IN RE: GERBER PROBIOTIC PRODUCTS MARKETING AND SALES PRACTICES LITIGATION, 10/16/12 Order Denying Transfer.
                  • MDL 2512 – IN RE: TRIVIA NATURAL SWEETENER MARKETING AND SALES PRACTICES LITIGATION, 2/12/14 Order Denying Transfer (denying 1407 centralization, given likelihood that litigation would would proceed in District of Hawaii based on the first-to-file rule)
                  • MDL 2392 – IN RE: WAGGIN’ TRAIN CHICKEN JERKY PET TREAT PRODUCTS LIABILITY LITIGATION, 9/28/12 Order Denying Transfer (“Various mechanisms are available to minimize or eliminate the possibility of duplicative discovery even without an MDL. In these circumstances, informal cooperation among counsel and coordination among the involved courts are, in our judgment, preferable to formal centralization. Notices of deposition can be filed in all related actions; the parties can stipulate that any discovery relevant to more than one action can be used in all those actions; or the involved courts may direct the parties to coordinate their pretrial activities.”); MDL 2348 – IN RE: CREST SENSITIVITY TREATMENT & PROTECTION TOOTHPASTE MARKETING AND SALES PRACTICES LITIGATION, 6/11/12 Order Denying Transfer (same)
                  • MDL 2374 – IN RE: HONEY PRODUCTION MARKETING AND SALES PRACTICES LITIGATION, 8/2/12 Order Denying Transfer (“Available alternatives to centralization may minimize whatever possibilities exist of duplicative discovery or inconsistent pretrial rulings.”)
                  • MDL 2237 – IN RE: CHILEAN NITRATE PRODUCTS LIABILITY LITIGATION, 5/20/11 Order Denying Transfer (denying transfer, in part, because “[defendant] represents that it has already offered to coordinate discovery, and that it is agreeable to the use of depositions of its witnesses in both actions”)

                  Transfer under 28 U.S.C. 1404 would be preferable.

                  • MDL 2469 – IN RE: CAPATRITI BRAND OLIVE OIL MARKETING AND SALES PRACTICES LITIGATION, 8/6/13 Order Denying Transfer
                  • MDL 2397 – IN RE: GERBER PROBIOTIC PRODUCTS MARKETING AND SALES PRACTICES LITIGATION, 10/16/12 Order Denying Transfer (detailed discussion of the advantage of section 1404 transfer over section 1407 transfer)
                  • MDL 2392 – IN RE: WAGGIN’ TRAIN CHICKEN JERKY PET TREAT PRODUCTS LIABILITY LITIGATION, 9/28/12 Order Denying Transfer
                  • In re Republic Western Ins. Co. Ins. Coverage Litig., 206 F. Supp. 2d 1364, 1365 (J.P.M.L. 2002)

                  Actions were at widely varying procedural stages.

                  • MDL 2366 – IN RE: LOUISIANA-PACIFIC CORP. TRIMBOARD SIDING MARKETING, SALES PRACTICES AND PRODUCTS LIABILITY LITIGATION, 6/11/12 Order Denying Transfer (denying transfer of five actions primarily because “such a significant procedural disparity among the subject actions”)
                  • MDL 2339 – IN RE: TEAMSTER CAR HAULER PRODUCT LIABILITY LITIGATION, 4/17/12 Order Denying Transfer (“centralization is not warranted here, as some of the actions have been pending in state or federal court for several years, and several are procedurally so far advanced that discovery is completed or nearly completed”)
                  • MDL 2321 – IN RE: YELLOW BRASS PLUMBING COMPONENT PRODUCTS LIABILITY LITIGATION, 2/9/12 Order Denying Transfer (denying centralization of 13 actions involving brass plumbing component, in part, due to “the relatively advanced progress of the District of Arizona Richards action”)
                  • MDL 2300 – IN RE: PLAVIX PRODUCTS LIABILITY LITIGATION, 12/14/11 Order Denying Transfer (denying centralization of 12 actions, in part, because 10 actions were commenced four to five years before the other 2 actions and “[m]oving defendants themselves acknowledge that they have completed all document production in the constituent District of New Jersey actions (approximately 3.5 million pages); the parties have served and responded to other written discovery; and most, if not all, depositions of the plaintiffs have been completed.”)
                  • In re Ambulatory Pain Pump-Chondrolysis Prods. Liab. Litig., 709 F. Supp. 2d 1375, 1378 (J.P.M.L. 2010) (denying centralization of 102 personal injury actions, in part because the actions were at “widely varying procedural stages”)).

                   Too few actions to warrant consolidation.

                  • MDL 2340 – IN RE: FRESH DAIRY PRODUCTS ANTITRUST LITIGATION, 4/17/12 Order Denying Transfer (“there are, as a practical matter, really only two actions in this docket, as the three Northern District of California actions have been consolidated”)
                  • MDL 2292 – IN RE: HIGHWAY ACCIDENT IN FULTON COUNTY, OHIO, ON AUGUST 2, 2009, 12/13/11 Order Denying Transfer (denying centralization of two actions)
                  • MDL 2237 – IN RE: CHILEAN NITRATE PRODUCTS LIABILITY LITIGATION, 5/20/11 Order Denying Transfer (denying centralization of two actions, in part, because “[t]here are . . . only two actions at issue”) (citing In re Transocean Ltd. Secs. Litig., 753 F. Supp. 2d 1373, 1374 (J.P.M.L. 2010) (“As we have stated in the past, where only a minimal number of actions are involved, the moving party generally bears a heavier burden of demonstrating the need for centralization.”))

                  Plaintiffs in one action moved for preliminary approval of a proposed nationwide settlement.

                  • MDL 2468 – IN RE: PILOT FLYING J FUEL REBATE CONTRACT LITIGATION, 8/8/13 Order Denying Transfer (denying transfer; noting that “[t]he Eastern District of Arkansas recently granted preliminary approval of a proposed nationwide class settlement, and final approval of the settlement will be considered in a few months.  Centralization at this time could delay settlement proceedings.”)
                  • MDL 2341 – IN RE: BUILDING PRODUCTS OF CANADA CORP. ORGANIC SHINGLES PRODUCTS LIABILITY LITIGATION, 4/17/12 Order Denying Transfer (denying centralization because Plaintiffs in one action “filed a motion for preliminary approval of class action settlement, which defendants represent would cover all claims in the actions before the Panel”)
                  • In re Power Balance, LLC, Mktg. & Sales Practices Litig., 777 F. Supp. 2d 1345, 1346 (J.P.M.L. 2011) (noting that “[c]entralization at this time could delay the [preliminary settlement] proceedings as well as entail additional expense for the litigants and the courts to establish an MDL proceeding with little benefit”)
                  • In re Toyota Motor Corp. Prius HID Headlamp Prods. Liab. Litig., 754 F. Supp. 2d 1380, 1381 (J.P.M.L. 2010)

                  Some of the actions are (or will be) proceeding to arbitration.

                  • MDL 2321 – IN RE: YELLOW BRASS PLUMBING COMPONENT PRODUCTS LIABILITY LITIGATION, 2/9/12 Order Denying Transfer (denying centralization of 13 actions involving brass plumbing component, in part, given that “that one of the actions is being arbitrated and others could proceed to arbitration”)

                   All defendants uniformly oppose centralization.

                  • MDL 2306 – IN RE: SKINNYGIRL MARGARITA BEVERAGE MARKETING AND SALES PRACTICES LITIGATION, 12/14/11 Order Denying Transfer (denying centralization of six actions, in part, because “all defendants uniformly oppose centralization [] a factor which is quite influential where other factors do not strongly favor centralization”)

                  Localized, intervening causation issues thwart efficiencies of centralization.

                  • MDL 2444 –  IN RE: SPRAY POLYURETHANE FOAM INSULATION PRODUCTS LIABILITY LITIGATION, 6/6/13 Order Denying Transfer (denying transfer of eight actions primarily because “individualized facts concerning the chemical composition of the different products, the training and practices of each installer, and the circumstances of installation at each residence will predominate over the common factual issues alleged by plaintiffs”)
                  • MDL 2321 – IN RE: YELLOW BRASS PLUMBING COMPONENT PRODUCTS LIABILITY LITIGATION, 2/9/12 Order Denying Transfer (denying centralization of 13 actions involving brass plumbing component, in part, because “significant localized intervening causation issues are expected to be at play (i.e., the applicable standards according to which the fittings were made, the thickness of the product, manufacturing conditions, proper installation/training, local water quality, compliance with local building codes, etc.) in each action”)

                  Proponents of centralization lacked specifics at the JPML hearing.

                  • MDL 2381 – IN RE: INTUITIVE SURGICAL, INC., DA VINCI ROBOTIC SURGICAL SYSTEM PRODUCTS LIABILITY LITIGATION, 8/3/12 (“Throughout the briefing process, and when questioned at oral argument, the parties seeking centralization made only vague generalizations about the specific nature of any common questions of fact, where discovery and pretrial proceedings will overlap, and how many cases are expected to be filed.”)

                  Not practical to centralize actions involving certain claims and remand the remaining actions.

                  • MDL 2393 – IN RE: UPONOR, INC., F1960 PLUMBING FITTINGS PRODUCTS LIABILITY LITIGATION, 9/27/12 Order Denying Transfer (“The exceedingly general language that the homeowners employ in most actions to describe the defective components at issue makes it impossible in most cases to transfer “F1960 claims” and then separate and remand, pursuant to Section 1407(a), non-F1960 claims.”)

                  Trade secrets militate against centralizing competitors.

                  • MDL 2444 –  IN RE: SPRAY POLYURETHANE FOAM INSULATION PRODUCTS LIABILITY LITIGATION, 6/6/13 Order Denying Transfer (“placing direct competitor manufacturer defendants into the same litigation would require protecting trade secret and confidential information from disclosure to all parties and complicate case management”)

                  Prospect of future filings not given much weight in centralization decision.

                  • MDL 2459 – IN RE: LIPITOR MARKETING, SALES PRACTICES AND PRODUCTS LIABILITY LITIGATION, 8/8/13 Order Denying Transfer (”Although plaintiffs suggest that the number of Lipitor cases is likely to expand considerably, we are disinclined to take into account the mere possibility of future filings in our centralization calculus.)

                  Litigation already resolved through arbitration; no remaining “pretrial activities” to warrant centralization.

                  • MDL 2538 – IN RE: CLEARTALK-ZTE ARBITRATION LITIGATION, 6/6/14 Order Denying Transfer

                   

                    Dealing with premature motions for class certification (filed to avoid Rule 68 offers)

                    Filing an bare-bones motion for class certification alongside the class-action complaint is one tactic to avoid the mooting effect of a Rule 68 offer. But what are defendants and the courts supposed to do with such a motion and its flimsy thread-bare recitals of the Rule 23 requirements?

                    Federal judges do not like motions lingering on their dockets longer than six months; it hurts their stats and gets reported to Washington.  See, e.g., Singer v. Illinois State Petroleum Corp., 2013 wl 2384314, at *2 (N.D. Ill. May 24, 2013) (“[T]his Court is unwilling to contemplate the prospect of shattering its unbroken record of more than three decades of reporting no ‘stale’ pending motions in its statutorily-required September 30 report where, as here, such purported staleness is occasioned by lawyer-caused delays rather than by this Court’s failing to act on a live motion.”).

                    Instead of agreeing to an arbitrarily fast six-month class-cert discovery and briefing schedule – all to avoid the prospect of a “stale” class certification motion – here are some better options:

                    Immediately dismiss the class-cert motion without prejudice to refiling later.

                    • Physicians Healthsource, Inc. v. Purdue Pharma L.P., 2013 WL 4782378, *1 (D.Conn. Sep 06, 2013) (“[I]t does not follow that an initial, under-developed motion—like the one at bar—must linger on the docket while the court awaits the filing of a later, fully-developed motion following discovery . . . .  To the extent that class allegations are preserved from mootness by the filing of a premature motion for certification, they are no less preserved by an order denying that motion without prejudice to renewal before final judgment.”)
                    • 3081 Main Street, LLC v. Business Owners Liability Team LLC, 2012 WL 4755048, *1 (D.Conn. Sep 24, 2012) (“[T]here is nothing to be gained by formally staying plaintiff’s current, underdeveloped motion while the court awaits the filing of a later, fully-developed motion. An order denying certification, much like an order granting certification, is ‘inherently tentative’ and the court ‘remains free to modify it in light of subsequent developments in the litigation.’ Therefore, plaintiff’s motion for class certification is denied without prejudice to renewal after discovery.”) (citations omitted)

                    Withdraw the motion and stipulate that defendant will not “pick off” the named plaintiff.  

                    • Kurgan v. Chiro One Wellness Centers LLC, 2014 WL 642092 (N.D.Ill. Feb 19, 2014) (noting that in the Seventh Circuit, often “motions are withdrawn shortly after the initial status hearing because defendants are willing to enter into a stipulation that they will not attempt to ‘pick off’ the named plaintiff in an early settlement”)