What is Multidistrict Litigation?

What is Multidistrict Litigation?

Multidistrict litigation (MDL) refers to the process of merging individual lawsuits with similar claims into a single federal court. This consolidation aims to save time, expenses, and resources during litigation. Also, an MDL intends to produce similar outcomes across many lawsuits nationwide. More than one-third of all federal lawsuits were pending in an MDL in 2019. 

Why Multidistrict Litigation Exists

Currently, there are over 180 MDLs across different states and districts. Many of these individual MDLs contain hundreds or thousands of plaintiffs, and some have tens of thousands. Congress created multidistrict litigation in the 1960s to organize and streamline complex litigation throughout the United States. When numerous people file individual lawsuits with similar allegations, this can overwhelm the court system. Usually, multidistrict litigation involves claims of dangerous drugs, defective products, and negligence that resulted in injuries. Since these types of claims often involve countless individuals nationwide, attorneys propose an MDL to conserve money and time. Additionally, an MDL will ensure consistent court ruling across the various lawsuits. 

How Does an MDL Begin?

In order to form an MDL, lawyers must submit a request to the Judicial Panel on Multidistrict Litigation (JPML). Within the legal motion, attorneys describe why the panel should consolidate these particular lawsuits. Next, the JPML will consider if the plaintiffs present similar claims, if the MDL is appropriate for all parties, and if this fosters efficiency. If the JPML approves the motion to consolidate, then it issues a transfer order. This order takes all the lawsuits and transfers them into a single federal district. Usually, the district is one where plaintiffs originally filed claims, or the district is relevant to the lawsuits. Also, the panel appoints one judge to preside over pretrial motions, discovery, and settlement conferences. 

What Are Bellwether Trials? 

It is not feasible to try every case due to the immense number of claims in an MDL. Therefore, MDLs usually have “test” trials called bellwether trials. These trials indicate the value of the cases and help foster negotiations toward a global settlement. The judge organizes several potential cases that represent the larger group. Generally, plaintiff and defendant attorneys can select an equal number of bellwether trials from this pool. Oftentimes, the size of the MDL dictates the number of bellwether trials. The outcome of the trials greatly affects the MDL going forward. 

Settlement Agreements in Multidistrict District Litigation

The success of bellwether trials will shape settlement agreements. For example, if the plaintiffs are victorious in the first few bellwether trials, this can encourage defendants to consider a settlement. However, if the bellwether trials produced mixed results or favor the defendants, the party may choose not to enter a settlement agreement. Bellwether trials and entering a settlement take time. Although coordinated efforts and resources help lawsuits in an MDL, it is still an extensive undertaking. In the event the parties cannot reach a settlement agreement, the cases may return to the original court of filing for trial.