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From Products Liability Law Daily, April 17, 2017

CAFA removal not triggered by consolidation for pretrial purposes only

By Robert B. Barnett Jr., J.D.

A request by eight groups of plaintiffs, who filed separate product liability suits in California state court against Cordis Corp. for manufacturing allegedly defective heart filters, to consolidate the cases only for purposes of pretrial proceedings did not by itself trigger removal jurisdiction to federal court under the Class Action Fairness Act’s (CAFA) mass action provision, the U.S. Court of Appeals for the Ninth Circuit has ruled. A normally clear-cut result was complicated by the plaintiffs’ statement that they sought a "bellwether-trial process," triggering an inquiry into which bellwether trial process they meant. Because the court concluded that the plaintiffs sought a bellwether-trial process in which the results of the bellwether trial could be binding only on the actual parties involved, CAFA removal did not apply (Dunson v. Cordis Corp., April 14, 2017, Watford, P.).

Numerous lawsuits arose against Cordis Corp. for manufacturing allegedly defective inferior vena cava filters, including at least eight class actions that were filed in state court in Oakland, California. The eight groups of plaintiffs filed a motion for consolidation to allow them to pursue jointly all pretrial efforts, including discovery, as part of a bellwether-trial process. Cordis then filed a motion in federal court asking the court to order removal of the cases to federal court under CAFA’s "mass action" provision. The district court refused, ruling that the motion for consolidation for pretrial purposes did not meet CAFA’s mass action requirements [see Products Liability Law Daily’s September 26, 2016 analysis]. Cordis appealed that decision to the Ninth Circuit.

Mass action. This consolidated case, the Ninth Circuit said, met some of CAFA’s mass action requirements: the case had more than 100 named plaintiffs (when all eight groups of plaintiffs were added together) and the eight actions raised common questions of law and fact because they all involved the same allegedly defective medical device. The dispute on appeal, however, centered on CAFA’s requirement that, for a case to involve mass action, the plaintiffs had to be proposing to try their cases jointly. Typically, when a group of plaintiffs seek consolidation only for purposes of pretrial procedures, the requirement that the plaintiffs propose to try their cases jointly will not be met. As a result, "[t]his appeal would be easy to resolve," the court said, except for one fact—the plaintiffs went beyond a mere request for consolidation to mention that they wanted a "bellwether-trial process."

Bellwether-trial process. Two types of bellwether processes exist. In one, a bellwether trial is held, and all the parties agree to be bound by the results of that trial. In the other, a bellwether trial is held, and the parties agree that no parties will be bound other than the parties actually involved in the bellwether trial. In that second example, the parties not involved typically use the bellwether trial results for their own settlement purposes. The distinction is important to this appeal, the court said, because, if the plaintiffs intended the first type of bellwether trial, they would be proposing to try their cases jointly and CAFA’s mass action requirement would be met. On the other hand, if the plaintiffs intended to undertake the second type of bellwether trial, no mass action would exist and removal would be inappropriate. In rejecting Cordis’s various arguments that the plaintiffs intended the first type of bellwether trial, the court ultimately relied on the plaintiffs’ statement in their motion: "To be clear, Moving Plaintiffs are not requesting a consolidation of Related Actions for purposes of a single trial to determine that outcome for all plaintiffs, but rather a single judge to oversee and coordinate common discovery and pretrial proceedings." As a final nail in the coffin of Cordis’s arguments, the court cited the plaintiffs’ statement that "consolidation of the Related Actions may create an opportunity for settlement of cases. Bellwether trials would likely prove an effective tool to resolution of the … cases." As a result, the appellate court concluded that the plaintiffs intended for a bellwether-trial process that did not bind the parties not involved in the trial, and, thus, CAFA removal was inappropriate.

Therefore, the Ninth Circuit affirmed the trial court’s rejection of Cordis’s motion to remove the case to federal court.

The case is No. 17-15257.

Attorneys: Troy Brenes (Brenes Law Group, PC) for Jerry Dunson. Rebecca Baden Chaney (Crowell & Moring LLP) for Cordis Corp.

Companies: Cordis Corp.

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