Managing Mass Tort MDLs

A new article on managing mass tort multidistrict litigations — Charles Silver and Geoffrey Miller, The Quasi-Class Action Method of Managing Multidistrict Litigation — has just been posted on SSRN.  If any mass tort lawyers reading this blog have a chance to look at the article, I’d be very interested in your responses to the proposals therein.  Is their diagnosis of the problem correct?  What do you think of their proposal to solve it?  What are the unforseen results this proposal might cause? 

Here is the abstract:

Thisarticle uses three recent multi-district litigations (MDLs) thatproduced massive settlements — Guidant ($240 million), Vioxx ($4.85billion), and Zyprexa ($700 million) — to study the emergingquasi-class action approach to MDL management. The approach has fourcomponents: (1) judicial selection of lead attorneys; (2) judicialcontrol of lead attorneys’ compensation; (3) forced fee transfers fromnon-lead lawyers to cover lead attorneys’ fees; and (4) judicialreduction of non-lead lawyers’ fees to save claimants money. Thesewidely used procedures have serious downsides. They make lawyersfinancially dependent on judges and, therefore, loyal to judges ratherthan clients. They compromise judges’ independence by involving themheavily on the plaintiffs’ side and making them responsible forplaintiffs’ success. They allocate monies in ways that likelyover-compensate some attorneys and under-pay others, with predictableimpacts on service levels. They also lack needed grounding insubstantive law because the common fund doctrine, which supports feeawards in class actions, does not apply in MDLs. Academics have notpreviously noted these shortcomings; this is the first scholarlyassessment of the quasi-class action approach.

This article alsoproposes an alternative method of MDL management. It recommends thecreation a plaintiffs’ management committee (PMC) composed of theattorney or attorney-group with the most valuable client inventory, asdetermined objectively by the trial judge. The PMC, which would have alarge interest in the success of an MDL, would then select and retainother lawyers to perform common benefit work (CBW) for all claimantsand monitor the lawyers’ performance. The new approach would thus usemicro-incentives to organize the production of CBW in MDLs rather thanjudicial control and oversight. The court would stand back from theprocess, exercising only a limited backup authority to prevent abuses.If enacted as a statute, the proposal would restore judges’independence, preserve lawyers’ loyalties, provide the requisite legalfoundation for fee awards, and encourage the fairer, more efficient,and more appropriate representation of claimants in MDLs.

ADL