Multidistrict Litigation Basics: A Primer for Plaintiffs
In recognition of World Mesh Awareness Day, I thought I’d write a longer post about the nuts and bolts of hiring an attorney and what should you expect if your case is part of a mass tort—e.g., if there are hundreds or even thousands of people who allege injuries from the same product?
I’m a law professor at the University of Georgia School of Law and an expert in mass torts and multidistrict litigation. I don’t represent any clients and I’m not affiliated with the attorneys or parties on either side in any way.
I am conducting a study on all multidistrict proceedings in which the defendant targeted or advertised its product or medical device to women. The project asks plaintiffs involved in these cases, which include pelvic mesh, to confidentially share their litigation experiences. If you’re suing over pelvic mesh, please, please participate by filling out this survey. I want to hear about what’s working well and what needs to be changed in these lawsuits and the more people I hear from, the better able I am to speak to those issues. I will not disclose any names or identifying information.
Finally, if you want to know more about the topics in this post, I have a book coming out this May, Mass Tort Deals: Backroom Bargaining in Multidistrict Litigation, that includes data on some of the early pelvic mesh and hernia mesh litigation that might be of interest to you all. The first chapter is devoted to some of the basics of the MDL process.
Here are the topics this longer post covers:
hiring a lawyer;
what to look for when signing a retainer agreement;
what is multidistrict litigation;
what's the difference between a class action and multidistrict litigation;
why doesn't my lawyer want me to speak publicly;
what are plaintiff fact sheets;
how can I get my case out of an MDL proceeding;
my lawyer wants me to settle, but I'm not so sure;
I can't find a lawyer to take my case;
next steps you can take.
Hiring a lawyer
Finding an attorney can be hard work. Most good attorneys will expect you to meet certain criteria before they will accept your case. They need to know that they’ll be able to prove, based on a preponderance of the evidence (over 50%, in other words) that mesh caused your injuries.
Be wary of attorneys who appear ready to take your case before getting substantial information about your situation and your injuries. They may be part of the “advertising lawyers,” lawyers who run ads on late-night tv or who post on highway billboards, but who don’t actually try cases. Instead, they may sell “leads” to other lawyers or package your case together with others and send them to other lawyers to make money off of the referrals.
How can you find a lawyer that you can trust? First off, ask around. If you’re part of an online community of those with similar injuries, see who represents them. Ask them if they trust their attorney to act in their best interest, how their lawyer keeps them informed about the progress of their lawsuit, and whether their calls are returned promptly.
Mass torts tend to work differently than ordinary lawsuits, like a car accident. You’re unlikely to find a “local” attorney who can afford to take on the likes of Merck or Johnson & Johnson. So, even if you hire a local lawyer, that lawyer will likely refer your case to one of the attorneys who regularly handles these types of cases. And that lawyer may represent hundreds of clients. That means that you’re unlikely to get the individual attention that you might hope to receive.
So, before hiring a local attorney, ask who will be handling your case and who they will affiliate with. Ask them about their relationship with those attorneys—have they worked with them before? Are they able to get them on the phone when needed? How do they plan to keep you updated—emails, client websites, phone calls, etc.? If their style doesn’t match your needs, it’s better to know that on the front end and look elsewhere.
Be your own advocate: save everything that has anything to do with your health and your lawsuit—medical bills, doctors’ visits, you name it. If you have insurance, Medicaid, or Medicare, those companies may place a lien on any settlement you take. Ask your lawyer what she plans to do to help negotiate those liens down.
At this point in the pelvic-mesh litigation, you may have trouble finding a lawyer now. I explain more about why this may be toward the end of this article.
Signing a Retainer Agreement
If you’re already plaintiff in a mass tort case like those involving pelvic and hernia mesh, chances are you’ve signed up with a law firm. Signing up with a law firm means signing a retainer agreement or a “fee agreement,” as they are sometimes called.
Retainer agreements spell out the law firm’s obligations to you and the fees and costs that you will incur as part of having that firm represent you. But signing on the dotted line doesn’t mean that clients actually understand what they're agreeing to—nor does it signal that the agreement itself is reasonable.
Fee agreements aren’t secret or confidential, but they are hard to find. I’ve unearthed a few agreements that are publicly available via court filings. Here are the top 5 eyebrow-raising provisions I found:
1. Contingent fee amount. Ethical rules in most states require lawyers to charge only “reasonable fees,” and some states, like New York, limit the percentage that attorneys can charge to one-third, or 33.3%. The provision below charges the client a whopping 40% even if the lawyer never files a lawsuit and 45% thereafter.
2. Common-benefit fees. In mass torts, judges often appoint “lead lawyers.” These attorneys are supposed to work on behalf of not just their own clients, but all of the plaintiffs in the proceeding. To pay them, judges withhold a portion of a plaintiff's settlement proceeds. The withheld percentage can range from 3-15%. Common-benefit fees should be deducted from the individual plaintiffs’ attorney's contingency fee--NOT heaped on TOP of that contingency fee as in the provision below. So, a plaintiff who agrees to a 33% contingency, still pays 33%, it just means that her lawyer must share a portion of that fee with the lead lawyers.
But in the excerpt below, the client had to pay a 45% contingent fee plus Judge Goodwin’s 5% court-ordered fee because of the retainer agreement, resulting in an eye-popping 50% contingent fee. This is fundamentally wrong and cuts against every theory of common-benefit fees that I’ve encountered.
3. Charging Interest on Costs and Expenses. Law firms pay a lot of money to develop a client’s case. They hire pricey experts to prove causation and they front more mundane expenses like civil filing fees and copying costs. Read the fine print carefully here—is the lawyer charging you to fly on private planes? Is your lawyer charging you interest on those expenses? Charging clients interest on expenses like in the clause below is troubling. It means that the longer a case lingers in court (via a protracted MDL, for example), the more a client must pay for costs.
Some lawyers don’t charge interests on costs at all, whereas others charge between 7 and 12%--a fairly big tax on your recovery if they spent that money early in your case. It’s a hidden expense, and one that you should be aware of.
4. Withdrawing from the Attorney-Client Relationship. States’ ethics rules dictate when a lawyer can “fire” a client, or withdraw from the representation. Model Rule of Professional Conduct 1.16(b) allows a lawyer to withdraw for no reason at all only if doing so will have no material adverse effect on the client’s interest. Clauses like the one below, which allow counsel to withdraw at any time, attempt to circumvent the protections afforded by the ethics rules.
5. Arbitration Provisions. For years, plaintiffs’ attorneys have lambasted arbitration provisions—and rightly so. Arbitration provisions allow those with the upper hand in contract bargaining to send a dispute to arbitration and some even allow that party to pick the arbitrator (the person who decides the case, in other words). So, imagine my surprise when I found that plaintiffs’ attorneys are taking advantage of arbitration provisions and waiving plaintiffs’ rights to sue them collectively when it suits them.
What is Multidistrict Litigation (MDL)?
Multidistrict litigation or “MDL” as it's known is the process that federal courts use to coordinate pretrial proceedings for cases with factual similarities. Congress has statutorily authorized multidistrict litigation through 28 U.S.C. § 1407.
The Judicial Panel on Multidistrict Litigation includes seven judges from throughout the country who are selected by the Chief Justice of the United States Supreme Court.
The “Panel” decides whether to centralize related proceedings before a single federal judge and then which judge will receive those cases. To make this decision, the Panel considers many different factors such as whether discovery needs are similar, whether similar facts exist, the number of actions, and whether there are competing motions for class certification.
Once the Panel decides to transfer cases, they have to pick a judge to handle them. For this decision, they consider things like the location of discovery materials, the convenience of the witnesses, location of the majority of actions, knowledge of the transferee judge, and the willingness and motivation of a particular judge to handle an MDL docket.
The judge that the Panel selects to preside over related cases is called the “transferee judge.”
Chapter 1 of Mass Tort Deals: Backroom Bargaining in Multidistrict Litigation provides more details on what MDL is and what a plaintiff or her attorney might expect in an MDL situation.
What’s the difference between a Class Action and an MDL?
Multidistrict litigation is the process that federal courts use to coordinate related cases before a single judge.
Sometimes that judge, the "transferee judge," will decide to certify a class action. Class certification must comply with Federal Rule of Civil Procedure 23. Rule 23 requires that class counsel adequately represent the class, that the class members are so numerous that joining them through conventional means is impractical, that class members' claims have common questions that can be answered collectively, and that class members' claims are typical of one another. In addition, to certify a Rule 23(b)(3) class, class members' claims must share a great deal in common. In the words of Rule 23, those common questions must predominate over individual questions.
Most mass torts are not certified as class actions, though there are some exceptions like the NFL Concussion case.
Chapter 1 of Mass Tort Deals: Backroom Bargaining in Multidistrict Litigation provides more details on why so few mass torts are certified as class actions (and the trouble that this may cause).
Why Doesn’t My Lawyer Want me to Speak Publicly?
I think the attorneys are worried about two things: 1) that whatever a client says publicly could be used by the defense to contradict what the client says “on the record” in a deposition or through a plaintiff fact sheet; and 2) that relaying certain information publicly could risk waiving the attorney-client privilege.
Both are valid concerns. In individual representation, it would be easier for a plaintiff to explore the rationale behind and the parameters of that pre-settlement ban, but in mass representation, lawyers tend to issue the blanket command of “don’t discuss it.”
Post-settlement, what a plaintiff can divulge is necessarily constrained by the terms of the settlement. Some confidentially provisions are more stringent than others, prohibiting clients from discussing the settlement or the facts surrounding it at all, whereas others prohibit plaintiffs from disclosing the amount.
I do think plaintiffs’ lawyers mean well, but it can be hard for clients, who feel isolated by the events. I’ve been encouraging plaintiffs to file adverse event reports or make anonymous comments to the FDA when it solicits public comments on a topic like mesh or breast implants. I’ve also encouraged plaintiffs to participate in the procedural justice study, which keeps plaintiffs’ identities confidential, and asks about their litigation experiences. How someone feels about the litigation process itself does not pose the same sort of risks.
What are Plaintiff Fact Sheets?
Fact sheets are part of what’s known in litigation as “discovery.” Fact sheets tend to exist only in multidistrict proceedings by transferee judges.
Different proceedings request different levels of information, but most ask for information about health records, injuries, and personal information such as your name and address. It’s important to fill these out in a timely way while consulting with your attorney. Many of them must be signed under penalty of perjury, so it’s important to be as accurate as possible.
How Can I Get My Case Out of an MDL Proceeding?
Having a case sent back to its original court or "remanded" to its court of origin is extremely difficult.
Historically, fewer than 3% of cases coordinated through an MDL proceeding are ever returned to the federal court in which they were filed.
Procedurally, only the MDL Panel can remand a case. In theory, they could do this on their own. In practice, they do so only upon a suggestion of remand by the transferee judge.
Chapters 5 and 6 of Mass Tort Deals: Backroom Bargaining in Multidistrict Litigation describe how the lack of remand (and the inability to threaten to take a case to trial) can hurt plaintiffs' cases. It likewise suggests several reform proposals, including episodic remands.
My Lawyer Wants Me to Settle
If you’ve received a settlement offer that you’re happy with, great! No need to keep reading this. If not, keep going.
On one hand, all settlement offers are compromises by their very nature. Neither side gets exactly what they want. But my research has shown that some plaintiffs feel strong armed by their attorneys to accept a deal. I can’t tell you whether to say yes or not, only you can decide something like that. But I can explain where that pressure comes from so that you can make a more informed choice.
First, aggregate settlements are fundamentally different from a settlement that you might strike if you were to get into a car accident. In that sort of case, the defendant would offer you money in exchange for dismissing your claim. And you'd know exactly what you were getting--the amount, the terms, etc.
But all the mass tort deals that I've analyzed differ substantially: aggregate settlements don't offer plaintiffs a fixed amount, but a chance to recover through a settlement program that may or may not compensate them. The so-called settlement is actually a deal between plaintiffs' attorneys and the defendant, not between the plaintiff and defendant as in our car accident example.
That means that some of the terms are directed toward plaintiffs' attorneys, and some are directed at the plaintiffs themselves. As we will see, it also means that plaintiffs' attorneys might be put in a pickle: their obligations under their agreement with the corporate defendant might conflict with the obligations they assumed when they agreed to represent a plaintiff as a client.
Provisions targeting plaintiffs' attorneys can thereby push ethical boundaries that require them to act in each client's best interest.
Here are the worrisome clauses that you'll find embedded in many settlement programs (for that's what they are—programs, not actually settlements). I’ve included some examples below.
1. Walkaway, withdrawal, or "blow" provisions. These clauses provide corporate defendants with the amount of "closure" that they can live with. They allow the defendant to walkaway from or withdraw from the deal (blow the deal, so to speak) if fewer than the designated percentage of the plaintiffs sign on. The participation percentages that I've seen range from 85-100%.
2. Case-census provisions. The dealmakers (lead attorneys on the plaintiff and corporate defendant's side) jointly petition the presiding MDL judge to issue a census. The census then requires all plaintiffs' attorneys with a case in the multidistrict proceeding to register all of their clients with related claims. It doesn't matter if that client is suing in state court (or if no suit has even been filed at all). The census then becomes the denominator for the walkaway provision.
3. Attorney-Withdrawal provisions. These clauses require plaintiffs' lawyers to take steps to withdraw from representing clients who refuse to settle. (I find them among the most ethically questionable provisions.) 4. Attorney-Recommendation provisions. All participating attorneys must recommend that all of their clients enter the settlement program and use their "best efforts" to ensure that happens.
5. New Suit Deterrence provisions. These clauses aim to prevent new lawsuits from being filed once a settlement is announced.
6. Reverter provisions. Money that is "leftover" in a settlement fund after the program doles it out reverts back to the corporate defendant.
Let’s take a close look at withdrawal, attorney-recommendation provisions, and attorney-withdrawal provisions. What do they look like and how might they affect the advice your lawyer gives you?
Here is an example of each taken from American Medical System's Master Settlement Agreement with Freese & Goss, PLLC/Matthews & Associates. You'll first see the withdrawal provision, demanding that at least 95% of plaintiffs agree to settle, then the requirement that Freese & Goss use its "best efforts" to get all of its clients to sign the release, then the withdrawal of counsel provision:
This, by the way, is the only master settlement agreement for the mesh cases that I've seen. It was made public when AMS filed it as an exhibit to its 10K filing with the SEC. Most remain private, so I'm unable to confirm whether others are similar, though I suspect that they are.
Each provision urges plaintiffs’ lawyers to encourage their clients to settle. AMS wants to end the litigation, so the walkaway percentage says that unless AMS has enough plaintiffs who are willing to settle, then the deal is off.
In order to reach that threshold percentage (95%), the plaintiff's law firm must use its best efforts (read: do a little arm twisting) to get their clients to settle.
If that fails, then Freese & Goss must take steps to withdraw from representing those clients.
Having your attorney withdraw from representing you just because you don’t want to settle isn’t just ill timed, it may also violate the ethics rules that govern lawyers. But there is a good bit of grey area here.
Here’s what I mean: legal ethics professors Howard Erichson and Benjamin Zipursky have written extensively about the ethics of these provisions in the context of the Vioxx settlement. They explain that the ABA's Model Rule of Professional Conduct 1.16(a) governs whether and when a lawyer may terminate her relationship with a client. Here's what they have to say:
Cases overwhelmingly reject the idea that a lawyer may fire a client for declining a settlement against the lawyer's advice. . . . Whether the stakes are immigration status or tort compensation, the settlement decision belongs to the client; a lawyer may not use the treat of withdrawal to hijack that decision.
Like the Vioxx Settlement Agreement, the AMS deal requires lawyers to take steps to withdraw from representing clients who decline to settle. Can Freese & Goss's obligations to AMS (the defendant!) provide good cause to withdraw under the ethics rules? Put differently, can a plaintiff's lawyer's deal with the corporate defendant allow an attorney to shirk obligations to a client?
Professors Erichson and Zipursky don’t think so. They put it bluntly:
[T]he very idea that entering into a contract with a client's adversary could establish good cause to withdraw from representing a client is troubling.
In other words, no.
What about the requirement that Freese & Goss recommend that all of their clients settle? Should we worry about that, too?
Let me phrase the question differently: does everyone involved in the pelvic mesh litigation have similar injuries and circumstances? Of course not. Would everyone be comfortable if their attorney gave them a uniform recommendation? Again, I suspect not. We are each individuals.
Clients may share some things in common and many are aggregated in the MDL before Judge Goodwin, but there are important differences. A deal may be good for some and not for others. A deal might, for example, not define certain surgeries as "mesh related." That could mean that a client with only one mesh removal surgery is well compensated, but others with multiple surgeries that don't all fit within the governing definition aren't.
Lawyers' obligations in mass torts that aren't certified as class actions run to each client individually for precisely this reason.
Professors Erichson and Zipursky conclude that both mandatory recommendation and withdrawal provisions violate the ethics rules:
The mandatory-recommendation provision is inconsistent with the lawyer's duty to give independent and loyal advice to clients. The mandatory-withdrawal provision violates the bar on practice restrictions, the constraints on terminating the lawyer-client relationship, and the principle that the decision to accept or reject a settlement belongs to the client.
I agree. Unfortunately, that doesn't mean that it doesn't happen. As I explore in Mass Tort Deals, 34% of the judges in my dataset allowed attorneys to withdraw from representing non-settling clients.
I Can’t Find A Lawyer to Take My Case
Once a corporation decides to settle, it doesn’t want new lawsuits being filed against it. So, essentially it tries to buy off plaintiffs’ attorneys to prevent them from filing new suits.
There are three groups who are affected by what I call “new suit deterrence provisions.”
1. plaintiffs whose lawyers have withdrawn from representing them, converting them into DIY pro se plaintiffs;
2. plaintiffs who have fired their attorneys for allowing them to fall through the cracks; and
3. new and would-be plaintiffs. Once corporate defendants start settling cases, it shows up in the press. This can bring the litigation to the attention of those who didn't know about it before, but who are having similar problems, and prompt them to sue.
So, here's the rub: corporate defendants don't want new suits filed against them, but the ethics rules that govern lawyers want to ensure that the best and brightest lawyers remain available to the public to take on new lawsuits. The Model Rules of Professional Conduct (Rule 5.6(b)) state that:
A lawyer shall not participate in offering or making an agreement in which a restriction on the lawyer's right to practice is part of the settlement of a client controversy.
In other words, defendants shouldn't be able to buy off the plaintiffs' lawyers by settling with their clients. But they do. Here’s how:
First up: American Medical System, Inc.'s deal with Freese & Goss, which requires that lawyers affirm that they have no intention to represent or solicit new clients:
And here's a clause from the Fosamax Master Settlement Agreement:
Isn't it clever how they've identified the ethics rule, declared that they in no way intend to violate it and then try to weasel around it by saying they have "no present intention" to solicit new claims?
Declaring that you're not violating the legal ethics rules and not violating the legal ethics rules are two very different things.
Provisions like these have been the subject of academic debate. Professors Stephen Gillers and Richard Painter argue that:
Market forces should assure that as some lawyers retire from suing certain defendants, others will replace them.