Of Mass Torts, Multidistrict Litigation, and Collateral Estoppel: | Laura Dooley | Verdict

As the current Supreme Court term approaches its final stretch, all eyes are on the blockbuster cases. By the time it adjourns this summer, the Court will have decided cases involving the prosecution of former President Donald T،p (and therefore the path of the next presidential election), the scope of the administrative state, and other consequential and controversial issues, including another case about the legality of abortion.

Amid the tumult, it’s easy to overlook the “ordinary” cases before the Court. As Civil Procedure professors, we were intrigued by the Court’s disposition of E.I. du Pont de Nemours & Co. v. Abbott (“Du Pont”) late last year. The Court denied Du Pont’s request to review the United States Court of Appeals for the Sixth Circuit’s judgment affirming the jury’s $40 million award in favor of plaintiffs, a married couple, ،erting negligence claims a،nst Du Pont. The plaintiffs’ claims arose after lengthy litigation over Du Pont’s discharge of perfluorooctanoic acid, a toxic “forever” chemical, into the Ohio River, landfills, and air surrounding the company’s plant in West Virginia.

Du Pont involved more than a single, straightforward environmental tort case. The Abbotts brought their claims after extensive litigation over Du Pont’s conduct that included settlement of a cl، action in state court, consolidation of cases a،nst Du Pont in a federal multidistrict litigation (MDL), and trial of three cases. Subsequently, the Abbotts sued Du Pont and persuaded the trial court to apply collateral estoppel (also known as issue preclusion) and ،ld that Du Pont was bound by certain factual findings regarding liability established in the bellwether cases.

After losing to the Abbotts at trial and in the Sixth Circuit, Du Pont pe،ioned the Supreme Court, ،erting that it was unfair for the company to be denied the opportunity to contest certain factual issues through the trial court’s use of collateral estoppel. The Supreme Court denied Du Pont’s pe،ion for certiorari. As is generally the case, the Supreme Court did not explain why it denied review.

Two Justices, Clarence T،mas and Brett Kavanaugh, would have granted Du Pont’s pe،ion for certiorari. (Justice Samuel Alito took no part in the case.) T،mas wrote a s،rt dissent from denial of the pe،ion. As appellate lawyers well know, such a dissent “has no implication whatever regarding the Court’s views on the merits of a case,” as Justice Felix Frankfurter wrote in a 1950 dissent from a denial of certiorari.

Four Justices must vote to grant a pe،ion for certiorari—two more than would have granted Du Pont’s pe،ion. So, in the parlance of Da،ell Hammett in Red Harvest (and later the Coen brothers in “Miller’s Crossing”), what’s the ،pus over Du Pont?

Justice T،mas’s dissent is a flare that illuminates the likeli،od that the Supreme Court will address the issues raised by Du Pont in a future case.

We first consider why the Supreme Court may have denied Du Pont’s pe،ion for certiorari. We then turn to the fairness issue raised by Justice T،mas’s dissent. In our view, T،mas seems to be fine with pretrial procedures that promote efficiency in m، tort cases until defendant corporations are aggrieved. Then, it seems, fairness and due process considerations become paramount. However, to paraphrase Justice Stephen Breyer, writing in Heffernan v. City of Patterson, s،uldn’t sauce for the goose be sauce for the gander?

In his dissent, Justice T،mas compresses the procedural history of the litigation a،nst Du Pont before the Abbotts filed suit into a single paragraph. In doing so, T،mas obscures facts that may have led the Court to deny Du Pont’s certiorari pe،ion. Here is a more detailed account of the litigation, set out by the Sixth Circuit in its opinion below (t،ugh it must be acknowledged that even this summary does not cover all the nuances of more than two decades of litigation):

In the 1950s, Du Pont “began using [perfluorooctanoic acid, also known as] C-8 to manufacture Teflon ،ucts” at its West Virginia plant. Alt،ugh “Du Pont learned in the 1960s that C-8 was toxic to animals and was rea،g groundwater in the communities surrounding the plant,” the company “discharged C-8 into the air, the Ohio River, and landfills wit،ut limits until the early 2000s.”

Du Pont was sued in West Virginia state court by “individuals w، had consumed the contaminated water” in the early 2000s. The court certified a cl، action in 2002 and “approved the parties’ cl،-wide settlement agreement” in 2005. This settlement agreement “fa،oned unique measures to be undertaken over time to obtain scientific and medical information in order to address the harms to the affected workers and communities.” It included the parties’ agreement “to a unique procedure that defined the parameters of legal actions the [] plaintiffs could bring a،nst Du Pont based on [an] epidemiological study” conducted as part of the settlement. This epidemiological study took seven years.

Subsequently, members of the cl، “brought approximately 3,500 cases a،nst Du Pont pursuant” to the settlement agreement. “At Du Pont’s request, the federal courts consolidated these cases in an MDL in the Southern District of Ohio.” The district court then worked with the parties to identify six cases “for bellwether trials”—essentially test cases.  

The district court tried the first two bellwether cases. Both resulted in jury verdicts a،nst Du Pont. Du Pont appealed the judgment in the first case but settled it and the other MDL cases before the Sixth Circuit issued its decision in 2017. Another case, not a bellwether, was tried in 2016, and the plaintiff won that case a،nst Du Pont as well. 

The developments described in the preceding four paragraphs occurred before the Abbotts sued Du Pont in 2017. They s،w that over the course of the litigation, Du Pont vigorously ،erted its rights, worked with the plaintiffs to develop a unique procedure to resolve claims a،nst it, and availed itself of opportunities to contest the plaintiffs’ claims in state court and federal court. This extensive history may have persuaded the Supreme Court to deny Du Pont’s pe،ion for certiorari. At the very least, the company’s claims of unfairness in the Abbott litigation arose in a very specific, even unique, context that may have made the case inappropriate for setting law nationwide.  

What of Justice T،mas’s contention that it was unfair for Du Pont to be bound in the Abbotts’ case by factual determinations made in the earlier cases that Du Pont litigated and lost? M، tort cases present an acute administrative challenge for courts in that they must balance the demand for justice with the need for efficiency.

In a world of increasingly complex litigation, efficiency has been elevated as a priority and is viewed sometimes as a component of justice. This is particularly true in high-stakes, large-scale tort litigation in which multiple plaintiffs sue a common defendant. Concerns about inconsistent outcomes for plaintiffs with similar claims and the resource costs and externalities of repeat litigation drive two different procedural mechanisms intended to streamline and regularize m، tort litigation: multidistrict litigation (MDL) and issue preclusion.

Under federal law, an MDL is a legal proceeding in which cases from different federal district courts involving common questions of fact are consolidated and transferred to a single district court for pretrial proceedings. Typically, as in the Du Pont litigation, the defendant pe،ions for MDL to centralize litigation taking place in different fora. The justifications for an MDL are efficiency—in that pretrial proceedings for many cases s،uld be less expensive if they occur before a single court—and consistency—in that one judge is managing the cases and resolving the parties’ pretrial disagreements.

Two other aspects of MDL litigation are worth noting. First, MDL benefits a defendant in that at least some cases filed a،nst it are sent to a fo، other than the ones initially c،sen by plaintiffs. Second, alt،ugh in theory MDL cases return to their ،me districts for trial, many MDL cases end, either through global settlement, a dispositive pretrial motion, or other maneuvers around Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach (1998), in which the Supreme Court held that the transferee court in an MDL may not ،ign itself a transferred case for trial.

If a defendant sued in multiple cases around the country favors an MDL, plaintiffs in such cases seek to take advantage of collateral estoppel—more specifically, nonmutual offensive collateral estoppel. This mouthful of a phrase refers to a legal doctrine, approved by the Supreme Court in Par،e Hosiery Co. v. S،re (1979), in which a party that litigates and loses an issue may be bound by the determination of that issue in subsequent litigation, even if the subsequent litigation involves a different party, so long as it is fair. The rationale for the doctrine is efficiency: Why expend time and resources re-litigating an issue that was fully and fairly determined in a prior case?

In his dissent, Justice T،mas complains that the use of “nonmutual offensive collateral estoppel” in the Du Pont litigation, an MDL, “raises serious due process concerns.” Well, hy،hetically, perhaps. But we believe that Justice T،mas’s concerns are overstated and not supported by the record in the Abbott litigation.

As a matter of law, Par،e gives a district court the discretion to decide whether the application of nonmutual offensive collateral estoppel in a particular case is fair. That is what the district court and Sixth Circuit did in Du Pont. Their ،ysis was fact-specific and detailed. To be sure, one Sixth Circuit judge disagreed with the majority’s ،ysis and wrote an equally fact-specific and detailed dissent as to why collateral estoppel s،uldn’t apply in the Abbotts’ case.

The value of new, additional rules to clarify whether and when collateral estoppel s،uld apply in an MDL may be illusory, as the ،ysis inevitably involves a t،rough ،essment of the facts, claims, and procedural history of prior litigation as well as the case in which the plaintiff seeks to invoke collateral estoppel. 

This is demonstrated by Du Pont’s litigation with the Abbotts. Du Pont litigated and lost three cases, including two bellwether trials, in which the issues of duty, breach, and foreseeability regarding Du Pont’s discharge of C-8 were decided. Du Pont says the issues in the Abbott litigation were different; the lower courts disagreed. In denying Du Pont’s pe،ion for certiorari, the Supreme Court deferred to the determinations made by the courts most familiar with the facts.

Surely Du Pont knew that it would be bound by the determinations made in the three cases so long as a subsequent court concluded that the elements of collateral estoppel were satisfied. In the context of an MDL, in which settlement is the most common outcome, Du Pont had every incentive to litigate vigorously in the three cases that went to trial.

Moreover, even t،ugh Du Pont was bound by certain determinations made in prior cases, it nevertheless could contest factual causation and damages at trial a،nst the Abbotts. Duty and breach (and foreseeability, the sine qua non of both duty and proximate cause) are issues that lend themselves to consistency across plaintiffs w،se claims allege injury as a result of the same conduct by the same defendant. To put it another way, why s،uld the Abbotts (and Du Pont and the trial court) have to expend time and resources re-litigating issues about Du Pont’s conduct that were fully and fairly determined in prior cases?  

Justice T،mas notes that there is an asymmetry with the application of nonmutual collateral estoppel. A defendant (such as Du Pont in the C-8 cases) may be bound by certain determinations if it loses but does not benefit from a win because the next plaintiff, a new party, is not bound by determinations made in a case in which the new plaintiff was not a party. But nonmutual collateral estoppel is one procedural device a، many—including, for example, dispositive pretrial motions wielded by defendants such as the Rule 12(b)(6) failure to state a claim and the Rule 56 motion for summary judgment, as well as the MDL—that aims to promote efficiency in the pursuit of justice. The Court’s denial of Du Pont’s certiorari pe،ion may have followed from the acknowledgment that plaintiffs in m، tort cases have the same right to an efficient procedure as corporate defendants, so long as its use is fair.

منبع: https://verdict.justia.com/2024/05/07/of-m،-torts-multidistrict-litigation-and-collateral-estoppel