Commercial Litigation and Arbitration

Multidistrict Litigation — When Transferee (MDL) Court May Overturn Decision of Transferor (Caselaw Split) — Mandamus to Review Transferee Court’s Refusal to Reconsider Decision of Transferor

From In re: Ford Motor Co., 580 F.3d 308 (5th Cir. 2009) [Note: Corrected opinion filed 12/16/09, reported at 2009 U.S. App. LEXIS 27637]:

:The issue—whether we can grant mandamus on a district court's refusal to reconsider a pretrial MDL decision—is one of first impression in this circuit. ***

We begin by addressing how MDL transferor courts review the pretrial determinations of transferee MDL courts. We have not established a standard for review of this question, though we note that authorities are unanimous that some deference must be given to the transferee court's decisions.

[Complete Deference]

[I]t would be improper to permit a transferor judge to overturn orders of a transferee judge even though error in the latter might result in reversal of the final judgment of the transferor court. If transferor judges were permitted to upset rulings of transferee judges, the result would be an undermining of the purpose and usefulness of transfer under [28 U.S.C. §] 1407 for coordinated or consolidated pretrial proceedings because those proceedings would then lack the finality (at the trial court level) requisite to the convenience of witnesses and parties and to efficient conduct of actions.

That view is nothing short of a bright-line rule that a transferor court cannot overrule a transferee court. Several courts have cited this maxim [including the Fourth Circuit].

[Substantial Deference]

Other commentators and courts, however, have rejected a bright-line approach and instead have advocated only substantial deference to the transferee court. "The general rules are not surprising: deference to the decisions reached by the prior judge and jurisdiction or authority to modify those rulings. This is particularly true for rulings which the transferee court could have itself modified." MULTIDISTRICT LITIGATION MANUAL § 10:17. "It would vitiate much of the purpose of consolidating litigation if, after remand, parties could simply re-visit the transferee court's pre-trial rulings, and force the common defendant to deal piecemeal with once-collective matters." Winkler v. Eli Lilly & Co., 101 F.3d 1196, 1202 n.5 (7th Cir. 1996).

[The Law of the Case Approach]

Instead of promoting general deference, others have stated that the "law of the case" should apply where a transferor court is deciding whether to over-turn the decision of a transferee court. "Although the transferor judge has the power to vacate or modify rulings made by the transferee judge, subject to comity and 'law of the case' considerations, doing so in the absence of a significant change of circumstances would frustrate the purposes of centralized pretrial proceedings." MANUAL FOR COMPLEX LITIGATION § 20.133. Some courts have agreed with this viewpoint. [Footnote 8: See, e.g., In re Multi Piece Rim Prods. Liab. Litig ., 653 F.2d 671, 678, 209 U.S. App. D.C. 416 (D.C. Cir. 1981) ("The doctrine of the law of the case has its application in multidistrict litigation as well as in traditional litigation." (citing ABC Great States, Inc. v. Globe Ticket Co., 316 F. Supp. 449 (E.D. Pa. 1970)).]

The better view is the latter -- that transferor courts should use the law of the case doctrine to determine whether to revisit a transferee court's decision. **

The law of the case doctrine requires that courts not revisit the determinations of an earlier court unless "(i) the evidence on a subsequent trial was substantially different, (ii) controlling authority has since made a contrary decision of the law applicable to such issues, or (iii) the decision was clearly erroneous and would work . . . manifest injustice." Propes v. Quarterman, F.3d , 2009 U.S. App. LEXIS 14055, 2009 WL 1813192, at *2 (5th Cir. June 26, 2009) (citing Goodwin v. Johnson, 224 F.3d 450, 457 (5th Cir. 2000)). ***


Mandamus is an appropriate remedy for "exceptional circumstances amounting to a judicial usurpation of power or a clear abuse of discretion." Cheney v. U.S. Dist. Ct., 542 U.S. 367, 380, 124 S. Ct. 2576, 159 L. Ed. 2d 459 (2004) (citations and internal quotation marks omitted); see In re Volkswagen of Am., Inc., 545 F.3d 304, 309 (5th Cir. 2008) (en banc), cert. denied, 129 S. Ct. 1336, 173 L. Ed. 2d 587 (2009). Plainly, a transferor court's refusal to reexamine a transferee court's FNC [forum non conveniens] decision can be one of the "exceptional circumstances," so long as the refusal meets our stringent criteria for granting mandamus. ***

In Volkswagen, we noted that an abuse of discretion occurs where a court "(1) relies on clearly erroneous factual findings; (2) relies on erroneous conclusions of law; or (3) misapplies the law to the facts." ..."On mandamus review, we review for these types of errors, but we only will grant mandamus relief when such errors produce a patently erroneous result." ... Showing that there was a clear abuse of discretion, however, is not enough:

The Supreme Court has established three requirements that must be met before a writ may issue: (1) the party seeking issuance of the writ must have no other adequate means to attain the relief he desires--a condition designed to ensure that the writ will not be used as a substitute for the regular appeals process; (2) the petitioner must satisfy the burden of showing that [his] right to issuance of the writ is clear and indisputable; and (3) even if the first two prerequisites have been met, the issuing court, in the exercise of its discretion, must be satisfied that the writ is appropriate under the circumstances.

Id. at 311. (citation, internal quotation marks and brackets omitted). "These hurdles, however demanding, are not insuperable." ***

[T]here was a clear abuse of discretion, because the transferor court refused to alter a transferee court's decision that relied on an erroneous conclusion of law. Petitioners submitted to jurisdiction in Mexico, and our caselaw plainly holds that Mexico is an available forum. It was patently erroneous for the MDL court to ignore this binding precedent and equally erroneous for the transferor court to accept that decision.

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