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In 1991, when the federal courts decided to transfer all pending asbestos cases to Senior U.S. District Judge Charles R. Weiner in Philadelphia, it seemed that a global settlement might one day be possible. Now, nine years later, that massive settlement has been rejected by higher courts, and some plaintiffs' lawyers are clamoring to get their asbestos cases out of Weiner's court and back to their home districts for trial. Frustrated with Weiner's procedures and what they perceive as his pro-defense stance in pressing for smaller settlements, several groups of plaintiffs turned to the Judicial Panel on Multidistrict Litigation seeking orders to remand their cases. When the MDL panel turned them down, the plaintiffs asked the 3rd U.S. Circuit Court of Appeals to issue a writ of mandamus ordering that all of the cases be remanded. But in a decision handed down on Tuesday, a three-judge panel found that Weiner's impressive track record of settling cases shows that he is still busy conducting "coordinated pretrial proceedings" -- as the MDL statute authorizes him to do -- and that the MDL panel therefore did not err in deferring to Weiner's judgment. "Because individual settlement negotiations and conferences are ongoing in the plaintiffs' individual cases, and because the transferee court is conducting discovery on overlapping issues that affect many asbestos cases, even if not the plaintiffs', coordinated pretrial proceedings have not concluded and the plaintiffs have not demonstrated a clear and indisputable right to the relief they seek," Senior U.S. Circuit Judge Walter K. Stapleton wrote. Attorney Steven Baughman Jensen of Baron & Budd in Dallas, who argued the case on behalf of three groups of plaintiffs from Georgia, New York and Oregon, said he was disappointed in the ruling and is considering a petition to the full 3rd Circuit or the U.S. Supreme Court. "Nothing that the MDL statute was designed to do is going on in MDL 875 right now," Jensen said in an interview yesterday. In his brief, Jensen argued that the MDL panel's 1991 order said that the types of matters appropriate for Weiner to consider included exploring opportunities for global settlements and using MDL as a vehicle for a national class action. But Jensen argued that Weiner's efforts to coordinate global negotiations have failed. At first, he said, Weiner organized plaintiffs' and defendants' steering committees. In November 1991, the defendants made a lump-sum offer to settle all pending and future cases, but the plaintiffs rejected the offer and "negotiations fell apart." Later, 20 defendants broke off to form the Center for Claims Resolution in an attempt to structure a class action settlement. But the $1 billion settlement of the case, which came to be known as Georgine v. Amchem, was ultimately rejected by the Court of Appeals and the U.S. Supreme Court, both of which deemed the class too large and unwieldy to satisfy the requirements of Rule 23. Jensen argued that since then discovery and settlement activities in MDL 875 are "entirely plaintiff specific." Instead of presiding over coordinated or consolidated pretrial proceedings, he argued, Weiner instead presides over discovery and settlement negotiations in discrete groups of cases involving individual plaintiffs' firms. "As a practical matter, the transferee court now acts as nothing more than a facilitator of a centralized, mandatory alternative dispute resolution system for ad hoc resolution of the highly individualized claims of asbestos personal injury victims," Jensen wrote in a brief joined by Baron & Budd attorneys Frederick M. Brown and Steven D. Wolens and Portland, Ore., attorney Jeffrey S. Mutnick of Landye Bennett & Blumstein. Jensen said the proceedings before Weiner "have devolved so far into piecemeal proceedings that the Plaintiffs' Steering Committee has not even met since 1993." He complained that Weiner has both publicly and privately repeated that he is unwilling to remand cases to their originating courts for trial unless the claimant is seriously ill or dying or all avenues of settlement are exhausted. And when he does remand cases, Weiner severs claims for punitive damages, Jensen noted. Since Weiner is no longer performing the function of an MDL transferee judge, Jensen said, the MDL panel should have granted the requests for remands in 88 cases from New York; 61 cases from Georgia; and 67 cases from Oregon. Weiner, he said, now "oversees no common discovery, decides no common legal issues and directs no global negotiations that affect all of the thousands of asbestos claims trapped in MDL 875." DEFENSE ARGUMENTS Arguing on behalf of Owens-Illinois Inc., attorney Robert H. Riley of Schiff Hardin & Waite in Chicago noted that Weiner's handling of MDL 875 has received well-earned praise. In 1991, Riley said, there were two new asbestos cases coming into the federal courts for every one disposed of. Weiner took control of 27,000 cases from 89 federal districts. By 1997, Weiner had received more than 69,000 cases and settled more than 44,000. His disposition rate of 7,000 to 8,000 cases per year for the first time exceeded the new filing rate. Riley said Weiner's "great success" earned him "a great deal of deference" when it came to deciding when the coordinated pretrial process was exhausted and remand was appropriate. The MDL panel, he noted, has rejected broad-scale remand requests on several occasions. In 1996, the panel refused to remand all cases or at least certain cases from Florida; in 1998, it said no to remanding Oregon cases, noting that Weiner had closed 53,000 cases and returned 976 for trial, including 29 to Oregon; and in 1999 it rejected similar requests from groups of plaintiffs in New York and Georgia. By statute, orders of the MDL panel are not appealable. The only mechanism for seeking review is writ of mandamus -- a rather high hurdle. As Riley described it in his brief: "Mandamus is an extraordinary remedy reserved for occasions of extreme urgency, when the lower court's decision is wildly wrong and petitioner's right to relief from it is beyond dispute." The plaintiffs, he said, had no support for their argument that MDL 875 "is some sort of judicial black hole where cases languish with no hope of resolution." Riley also disputed that the MDL transferee court is limited to conducting consolidated or common-issue discovery. Instead, he said, the law gives the court all pretrial powers. By seeking a writ to win remands, Riley said, the three groups of plaintiffs were "seek[ing] to deprive the federal courts of the one tool -- multidistrict litigation -- that has been successful in helping to manage the crushing burden of asbestos litigation." MANDAMUS DENIED Now the 3rd Circuit has sided with Riley and his defense colleagues, finding the plaintiffs failed to meet their high burden of showing that they had an indisputable right to have their cases remanded. Stapleton, in a 23-page unpublished opinion joined by U.S. Circuit Judges Morton I. Greenberg and Jane R. Roth, found that a large number of the cases assigned to Weiner have been resolved. In 1997 and 1998 alone, he said, Weiner closed nearly 10,000 cases per year. Although the plaintiffs are correct that the MDL statute imposes two limitations on the transferee judge -- that the proceedings must be "coordinated or consolidated" and "pretrial" -- Stapleton rejected the second half of their argument, which said that ongoing settlement negotiations do not constitute coordinated or consolidated pretrial proceedings. Instead, Stapleton said, the U.S. Supreme Court's decision in Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach "indicates that the phrase 'coordinated or consolidated' is to be read broadly." Stapleton said the Lexecon decision can't be reconciled with the plaintiffs' argument that MDL proceedings are over when court ceases to conduct proceedings that are common to all. "To be coordinated, it is not necessary that common issues are being contemporaneously addressed," Stapleton wrote. "Applying the reasoning of Lexecon, it appears that the individual settlement negotiations and conferences that are occurring in plaintiffs' cases are in fact 'coordinated' proceedings." Armstrong World Industries was represented in the appeal by Elizabeth R. Geise and John D. Aldock of Shea & Gardner in Washington, D.C., along with John G. Gaul and Christopher D. Wolfe of the Center for Claims Resolution in Princeton, N.J. By Shannon P. Duffy The Legal Intelligencer
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