E.D.N.Y. Proposes Expanding CAFA to Cover National MDL, Non-Rule 23, Aggregate Actions

Per In re Zyprexa Products Liability Litigation, 2006 WL 3543157 (E.D.N.Y. Dec. 07, 2006):

Some of the stumbling blocks that concurrent jurisdiction over mass actions by state and federal courts can place on the road to a final global settlement have been removed by Congress in some formal, Rule 23, class action proceedings. The Class Action Fairness Act of 2005 ("CAFA" or "the Act") is a good example of legislative efforts to allow mass national litigation to proceed on a consolidated basis in a single forum. CAFA provides federal courts with exclusive jurisdiction over class actions in which the amount in controversy exceeds five million dollars, and any member of the plaintiff class is a citizen of a different state than any defendant, unless two-thirds or more of plaintiffs and primary defendants are citizens of the state in which the class action was originally filed. 28 U.S.C. §§ 1332(d), 1453, 1711- 1715. Part of the legislative impetus for the Act was the recognition that the resolution of some multi-state mass actions of national import was being hindered by concurrent adjudication in state and federal courts.

. . .

Both CAFA and SLUSA recognize the desirability of consolidating and adjudicating the many cases that form a mass national litigation in a single forum. The drafters of CAFA found the federal forum to be appropriate for cases that involve national interstate interests and affect interstate commerce, like the present one involving a large multi-national pharmaceutical company. See Senate CAFA Report; Edward F. Sherman, Class Actions After the Class Action Fairness Act of 2005, 80 Tul. L.Rev. 1593, 1595 (2006) ("corporations that do business in multiple states complained that they were subjected to national or multistate class actions in state courts that could thereby establish legal standards that would govern their activities throughout the country").

It may be useful for Congress to consider expanding the Class Action Fairness Act from class actions to at least some national MDL, non-Rule 23, aggregate actions. As use of the class action device to aggregate claims has become more difficult, MDL consolidation has increased in importance as a means of achieving final, global resolution of mass national disputes. See Part II, supra. Much the same concerns which animated CAFA's preference for a single, federal forum apply to national MDL aggregate actions.