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29–548 PDF 2006

S. HRG. 109–535

THE MULTIDISTRICT LITIGATION RESTORATION

ACT

HEARING

BEFORE THE

SUBCOMMITTEE ON ADMINISTRATIVE OVERSIGHT 

AND THE COURTS

OF THE

COMMITTEE ON THE JUDICIARY 

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

JUNE 29, 2006

Serial No. J–109–91

Printed for the use of the Committee on the Judiciary

(

(II)

COMMITTEE ON THE JUDICIARY 

ARLEN SPECTER, Pennsylvania, Chairman 

ORRIN G. HATCH, Utah 

CHARLES E. GRASSLEY, Iowa 

JON KYL, Arizona 

MIKE DEWINE, Ohio 

JEFF SESSIONS, Alabama 

LINDSEY O. GRAHAM, South Carolina 

JOHN CORNYN, Texas 

SAM BROWNBACK, Kansas 

TOM COBURN, Oklahoma 

PATRICK J. LEAHY, Vermont 

EDWARD M. KENNEDY, Massachusetts 

JOSEPH R. BIDEN, JR., Delaware 

HERBERT KOHL, Wisconsin 

DIANNE FEINSTEIN, California 

RUSSELL D. FEINGOLD, Wisconsin 

CHARLES E. SCHUMER, New York 

RICHARD J. DURBIN, Illinois 

MICHAEL O’NEILL, Chief Counsel and Staff Director 

BRUCE A. COHEN, Democratic Chief Counsel and Staff Director 

SUBCOMMITTEE ON ADMINISTRATIVE OVERSIGHT AND THE COURTS

JEFF SESSIONS, Alabama, Chairman 

ARLEN SPECTER, Pennsylvania 

CHARLES E. GRASSLEY, Iowa 

JON KYL, Arizona 

CHARLES E. SCHUMER, New York 

DIANNE FEINSTEIN, California 

RUSSELL D. FEINGOLD, Wisconsin 

WILLIAM SMITH, Majority Chief Counsel 

PREET BHARARA, Democratic Chief Counsel 

(III)

C O N T E N T S

STATEMENTS OF COMMITTEE MEMBERS

Page

Hatch, Hon. Orrin, a U.S. Senator from the State of Utah ................................. 4

Sessions, Hon. Jeff, a U.S. Senator from the State of Alabama .......................... 1

Schumer, Charles E., a U.S. Senator from the State of New York ..................... 3

WITNESSES 

Hodges, Wm. Terrell, Senior U.S. District Judge, District Court for the Middle 

District of Florida, and Chairman, Judicial Panel on Multidistrict Litigation, Ocala, Florida .............................................................................................. 5

Thrash, Thomas W., Jr., U.S. District Judge, District Court for the Northern 

District of Georgia, Atlanta, Georgia .................................................................. 7

QUESTIONS AND ANSWERS 

Responses of Judge Hodges to questions submitted by Senator Schumer .......... 16

SUBMISSIONS FOR THE RECORD 

Chamber of Commerce of the United States, R. Bruce Josten, Executive 

Vice President, Government Affairs, Washington, D.C., letter ........................ 22

Hodges, Wm. Terrell, Senior U.S. District Judge, District Court for the Middle 

District of Florida, and Chairman, Judicial Panel on Multidistrict Litigation, Ocala, Florida, statement, attachment, and letters .................................. 23

Jaffe, Richard, Office of Legislative Affairs, Administrative Office of the U.S. 

Courts, statement ................................................................................................. 57

Judicial Conference of the United States, Leonidas Ralph Mecham, Secretary, 

Washington, D.C., letter ...................................................................................... 59

Thrash, Thomas W., Jr., U.S. District Judge, District Court for the Northern 

District of Georgia, Atlanta, Georgia, statement ............................................... 61

Van Itallie, Theodore B., Jr., General Counsel, Johnson & Johnson, New 

Brunswick, New Jersey, letter ............................................................................ 75

(1)

THE MULTIDISTRICT LITIGATION 

RESTORATION ACT 

THURSDAY, JUNE 29, 2006 

U.S. SENATE, 

SUBCOMMITTEE ON ADMINISTRATIVE OVERSIGHT AND THE

COURTS, COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 2:30 p.m., in room 

SD–226, Dirksen Senate Office Building, Hon. Jeff Sessions, Chairman of the Subcommittee, presiding. 

Present: Senators Sessions, Hatch, and Schumer. 

OPENING STATEMENT OF HON. JEFF SESSIONS, A U.S. 

SENATOR FROM THE STATE OF ALABAMA 

Chairman SESSIONS. The hearing will come to order. 

In 1968, Congress passed the multidistrict litigation statute 

found in Section 1407 of Title 28, U.S. Code. Under the multidistrict litigation, or ‘‘MDL,’’ statute, when civil cases involving common questions of fact are pending in multiple Federal district 

courts, the Judicial Panel on Multidistrict Litigation may transfer 

those cases to a single transferee judge for coordinated or consolidated pretrial proceedings. The MDL process has resulted in greater efficiency and consistency in handling thousands of extremely 

complex cases, and to date, over 228,000 cases involving literally 

millions of claims have been centralized through the MDL process. 

The cases run the gamut of civil litigation—from antitrust claims 

to Zyprexa’s product liability litigation—literally A to Z. 

It is also significant that MDL proceedings frequently involve 

millions, if not billions, of dollars in claims and potential liability. 

These cases are often founded on a single fact situation, or a single 

charge of liability that forms a basis for compensation. It does not 

make good sense that each one of those cases be retried again and 

again. 

For nearly the first 30 years of multidistrict litigation proceedings, transferee judges would use the venue statute, 28 U.S.C. 

1404(a), in some situations, to transfer cases to the transferee district. That is, the judge, in effect, would keep that case. The transferee judge would transfer it to his own transferee district for trial. 

That judge would know the facts. He had already been involved 

with the lawyers. He had been made familiar through pretrial processes with the nature of the case and knew a great deal about it. 

By 1995, of the 39,228 cases transferred for coordinated or consolidated proceedings under the MDL statute, 279 of the 3,787 that 

2

ultimately required a trial were actually retained by the transferee 

judges. 

The MDL statute, though, provides that, ‘‘each action . . . 

transferred shall be remanded by the Multidistrict Litigation Panel 

at or before the conclusion of . . . pretrial proceedings to the district from which it was transferred’’—transferred originally—‘‘unless it shall have been previously terminated.’’ That is 28 U.S.C. 

§ 1407(a). 

So in 1998, the Supreme Court unanimously ruled in Lexecon v. 

Milberg Weiss Barshad Hynes & Lerach that this plain statutory 

language, with this mandatory ‘‘shall,’’ prohibited the transferee 

judge from retaining those cases for trial. I think the Supreme 

Court had to be said to have followed the law that Congress wrote 

correctly, even though they may have had doubts about the wisdom 

of it. 

In Lexecon, one of the parties argued ‘‘that permitting transferee 

courts to make self-assignments would be more desirable than preserving a plaintiff’s choice of venue.’’ And the Supreme Court observed that the respondent ‘‘may or may not be correct’’ on that 

point as a policy matter, but noted ‘‘the proper venue for resolving 

that issue remains the floor of the Congress.’’ So they respected the 

Congressional prerogative, at least in this case. 

The ruling in Lexecon was a matter of statutory interpretation, 

not constitutional law. Thus, if Congress wants to change the result of the Lexecon decision, it can do so by amending the statute. 

In September 1998, the Judicial Conference asked Congress to do 

just that—to amend the MDL statute to permit the transferee 

judges to retain certain MDL cases for trial. The House of Representatives has passed legislation to address the Lexecon decision—the so-called ‘‘Lexecon fix’’—in the 106th, 107th, and 108th 

Congresses. The Senate passed its own Lexecon fix in the 106th 

Congress as well. The legislation was sponsored by my colleague, 

Senator Hatch, and cosponsored by Senators Leahy, Grassley, 

Kohl, Torricelli, and Schumer. None of these bills has become law 

to date, however. 

The House again passed a Lexecon fix last year, H.R. 1038, and 

that legislation has been referred to the Senate Judiciary Committee. The last hearing on the Lexecon issue was held in the 

House of Representatives in 1999. So we wanted to now hold this 

hearing to learn about the Lexecon issue and to understand if the 

Lexecon fix is still needed. 

In addition, H.R. 1038 contains a similar self-transfer for trial 

provision for disaster litigation cases under the Multiparty, 

Multiforum Trial Jurisdiction Act of 2002. That addresses a slightly different issue and, thus, also justifies our consideration. 

MDL cases are some of the largest, most complex, most time-consuming, most economically significant cases handled by the Federal 

judiciary. Thus, Congress must exercise its jurisdiction wisely and 

‘‘look before we leap,’’ but also consider the history and success of 

the previous procedures by which those cases remain with the 

transferee jurisdiction. 

So those are my general comments. Our Ranking Member, Senator Schumer, is here on our Subcommittee and Senator Hatch is 

3

with us as well. I would be delighted, Senator Schumer, if you have 

any comments to make at this time. 

STATEMENT OF HON. CHARLES E. SCHUMER, A U.S. SENATOR 

FROM THE STATE OF NEW YORK 

Senator SCHUMER. Well, thank you, Mr. Chairman, for holding 

this hearing, and I want to welcome our witnesses, two very distinguished judges who know a great deal about this topic, certainly 

more than at least one member of this panel on this side of the podium. 

We are here today to discuss what is on its face a highly technical amendment to the Rules of Civil Procedure. To be sure, the 

subject of multidistrict is one that can make most people’s eyes 

glaze over. But the Rules of Procedure, even if they are technical, 

have real impact on real people, their lives and their livelihoods. 

Seemingly technical rules like the one we are considering today can 

determine whether a citizen gets a fair shake or a bad deal. It can 

determine whether a citizen gets his or her day in court or is left 

behind by the legal system. So, in a nutshell, this is important 

stuff. 

As my colleague has already noted, we are here to address proposed legislation in the wake of the Supreme Court’s decision in 

Lexecon. The U.S. Code currently allows the Panel of Multidistrict 

Litigation to consolidate pretrial proceedings of cases pending in 

more than one district for reasons of efficiency. Although courts 

once commonly retained cases after pretrial proceedings to conduct 

trial, the Supreme Court in Lexecon said the cases have to go back 

to the local court. So we are here to discuss whether to create a 

statutory fix and return us to the status quo before Lexecon. 

Congress has both the authority and the responsibility to set the 

ground rules for our legal system. In fulfilling that responsibility, 

Congress has to strike the right balance between efficiency and 

fairness. In doing so, we must think ahead, and we must ask the 

right questions. Today’s hearing presents us with a number of critical questions. Most fundamentally, what does it mean to get your 

day in court? In other words, does that mean the court down the 

street? Or, for efficiency in huge tort cases, should it mean the 

court four States away? 

How important is it for a plaintiff to have a local jury assess pain 

and suffering damages rather than a judge in a different State? 

How big are the efficiency gains at stake? And how does all this 

affect the principles of federalism? 

So this issue is more important and fundamental than the dry 

text of the statute would suggest. The issue, as my colleague noted, 

has been kicking around the Congress for a number of years. As 

he also noted, I cosponsored an early version of the bill sponsored 

by Senator Hatch in 1999, and the House has passed versions of 

the Lexecon fix four times since. 

Today’s hearing is an important step forward, and I want to 

thank our panel for appearing today. 

Chairman SESSIONS. Thank you, Senator Schumer, for your interest in this matter in the past. 

4

Senator Hatch, you have been a sponsor of legislation similar to 

this. We welcome your opening statement if you would like to make 

one now. 

STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM 

THE STATE OF UTAH 

Senator HATCH. Well, thank you so much. I cannot stay for very 

long, and I just want to welcome these two great judges, and we 

appreciate having you here to counsel with us and help us understand these issues better. 

This is complex, a seemingly simple fix to the system, but, nevertheless, very complex if you look at it through the eyes of actuality. 

But I want to thank you, Senator Sessions, for scheduling this 

hearing today. 

I have to say to you judges, your dedication to the Federal court 

system, the cause of justice, and all who come before you I think 

is truly admirable, and I appreciate your willingness to show up 

and testify today. 

I will not go into—I think both of my colleagues have covered 

this pretty well, and, frankly, I want to pay tribute to both Senator 

Sessions and Senator Schumer. They are both active and good 

members of this Committee, and they do a terrific job on this Committee. This is not partisan legislation. It favors neither Democrats 

nor Republicans, neither plaintiffs nor defendants. What this legislation does, it restores the courts to the pre-Lexecon practice that 

worked well for 30 years. It gives judges the tools they need to do 

their work and promote just resolutions for all parties in a fair and 

efficient manner. 

So I just once again want to thank you, Mr. Chairman, for holding this hearing, and I will be very interested. I have read some 

of what your statements are, and I look forward to complete my 

reading of them, and I will pay pretty strict attention to what you 

are talking about here today. 

Thank you so much. 

Chairman SESSIONS. Thank you, Senator Hatch. 

We have two distinguished Federal judges on our panel today. 

Our first witness is Hon. William Terrell Hodges, Senior United 

States District Judge from the Middle District of Florida and, since 

2000, Chairman of the seven- member Judicial Panel on Multidistrict Litigation. That is the panel, is it not, Judge Hodges, that 

makes the assignments? 

Judge HODGES. It is, Senator, yes. 

Chairman SESSIONS. Judge Hodges received his B.S. in business 

administration from the University of Florida and his law degree 

from the University of Florida School of Law, where he was Executive Editor of the Florida Law Review. After a distinguished career 

in private practice, Judge Hodges became a U.S. District Judge in 

the Middle District of Florida in 1971. From 1982 to 1989, he was 

Chief Judge in the Middle District of Florida. During his time on 

the bench, Judge Hodges served on the Circuit Council of the Eleventh Circuit, as President of the District Judges Association of the 

Fifth Circuit, as a member of the Judicial Conference of the United 

States, and from 1996 to 1999 as Chairman of the Executive Committee of the Judicial Conference, to name just a few of his many 

5

activities. As I said, since 2000, Judge Hodges has chaired the Judicial Panel on Multidistrict Litigation. 

He is a recipient of the 2003 William M. Hoeveler Judicial Professionalism Award from the Florida Bar Association and the 2003 

Edward J. Devitt Distinguished Service to Justice Award from the 

American Judicature Society. 

Thank you, Judge Hodges, for being with us today and sharing 

your expertise and insight. 

Our second witness is Hon. Thomas W. Thrash, Jr., a United 

States District Judge for the Northern District of Georgia. He happens to be from Alabama, which I am proud to note. He received 

his B.A. in American Government with high distinction in 1973 

from the University of Virginia, and received his law degree cum 

laude from Harvard Law School in 1976, where he was president 

of the Learned Hand Club that is good—and director of the Lincoln’s Inn Society. Both are very important. 

After a distinguished career as an assistant district attorney and 

in private practice in Atlanta, Judge Thrash became a U.S. District 

Judge for the Northern District of Georgia in 1997. Since 2000, 

Judge Thrash has served on the Committee on Rules of Practice 

and Procedure of the Judicial Conference of the United States. He 

is the author of numerous articles in law reviews and bar journals 

on topics as varied as campaign finance and medical malpractice 

issues. He has also been a frequent lecturer and presenter at various meetings and continuing legal education seminars. 

On January 11th, Judge Thrash made a presentation entitled 

‘‘The Lexecon Dilemma’’ to the Judicial Panel on Multidistrict Litigation Transferee Judges Conference. 

So we are delighted to have you here, Judge Thrash, and note 

that you have had personal experience as a transferee judge in two 

MDL proceedings yourself. 

Judge Hodges, we would be delighted to hear from you and then 

Judge Thrash. 

STATEMENT OF WM. TERRELL HODGES, SENIOR U.S. DISTRICT 

JUDGE, U.S. DISTRICT COURT FOR THE MIDDLE DISTRICT 

OF FLORIDA, AND CHAIRMAN, JUDICIAL PANEL ON MULTIDISTRICT LITIGATION, OCALA, FLORIDA 

Judge HODGES. Thank you, Senator Sessions, Mr. Chairman, and 

Senator Schumer. I appreciate the opportunity to be here. I do 

come to represent the Judicial Conference of the United States and 

also the Judicial Panel on Multidistrict Litigation, which I presently chair, as you noted. 

Chairman SESSIONS. For the record, would you just describe 

briefly the Judicial Conference and the role that plays in the judiciary? 

Judge HODGES. Well, the Judicial Conference of the United 

States can best be described, I would say, as the board of directors 

of the Federal judiciary. It consists of 27 members—a district judge 

and the chief circuit judge from each of the regional circuits, also 

the Court of Federal Claims along with the Federal Circuit, and 

the Chief Justice of the United States, who chairs the sessions of 

the Conference. And, by statute, the Judicial Conference establishes the policy of the Federal judiciary, which is then applied and 

6

enforced, if you will, by the several Judicial Councils of the circuits 

geographically around the country. 

So the Conference is the policymaking body of the Federal judiciary and speaks for the judiciary in matters such as this that come 

before Congress. So, in a sense, I am here representing all the Federal judges of the United States, speaking through the Judicial 

Conference. 

And I might say with respect to this particular subject, there 

may be one or two—there always are, but I am not aware of any 

judge anywhere who opposes this legislation. 

As far as an opening statement is concerned, I must say that 

your statement and that of Senator Schumer just covered the 

ground that I intended to cover by way of background. I might say 

the last time I had that experience as a lawyer, I lost the case. 

[Laughter.] 

Judge HODGES. And I hope I don’t have that experience again. 

But I might take just a minute to embellish the remarks that you 

made so succinctly by pointing out what I have now observed over 

these last 6 years, at least, as the Chair of the Panel, what the 

Panel really accomplishes in the administration of justice in this 

country. 

By centralizing cases in a single district where multiple cases 

have been filed in various districts, there are obviously a number 

of desirable advantages. One is that it eliminates duplication of judicial effort of different judges in different districts considering the 

same controlling legal issues. It promotes, in other words, judicial 

economy, which is always a matter of interest to the courts. It reduces the costs of the litigation, the overall cost to the litigants involved. There may be some who would be able to argue that a centralization may increase their personal costs in a particular instance, but, clearly, the overall costs of the litigation and the demands that it makes on the system for the administration of justice 

are reduced by the procedure over which the Panel presides. 

It also avoids inconsistent results being reached in different 

courts by different judges because the issues presented by the litigation that comes before the Panel are complex matters and are 

reasonably susceptible of different views. And when two judges in 

two different districts or in two different circuits reach contrary 

conclusions, that obviously leads to confusion not only in the litigation but in the law itself. And by centralizing litigation of the kind 

we see in one district, it promotes consistency in the development 

of the law itself. 

And, finally, it protects—and I think the asbestosis cases are a 

good example of this—it protects to some extent the funds that are 

available to respond to the claims of those who feel that they have 

been injured; otherwise, you would have races to the courthouse 

trying to be the first to reach judgment in order to satisfy the 

claim, and more than likely producing a bankruptcy petition, which 

can only serve not in the best interests of the parties interested in 

the overall litigation. 

Now, all of that is to some extent threatened from time to time 

in cases in which the transferee judge is not permitted to transfer 

the litigation to himself or herself for the purpose of attempting, 

for example, to achieve a global settlement. Almost all the cases 

7

that we create and send to a transferee court sooner or later will 

settle if they can be properly managed by the able transferee 

judges that we try to select to manage the litigation, such as my 

brother and friend, Judge Thrash, who will tell you about his experience. And without the ability to transfer a case to oneself in some 

instances, then the ability to manage that case is reduced and the 

likelihood of settlement or ultimate termination in the transferee 

court is hampered. So it is a matter of importance. 

But I would close by emphasizing, I think, one very important 

point, particularly as it relates to the rights of individual plaintiffs 

in mass tort cases, which is one of the species of cases that we do 

see, and that is that this legislation does not mean that all cases 

that are transferred as a part of the multidistrict litigation process 

will be transferred to the transferee judge for trial. On the contrary, depending upon the type of case involved, I don’t envision 

that there would be any change in the practice as it existed prior 

to Lexecon when that was not a problem, to my knowledge, but 

would only be used in some instances to identify cases, for example, 

as possible bellwether cases that the trial of which will settle some 

issues and ultimately promote a global settlement. And to take 

mass tort victims particularly, I would anticipate that in most of 

those cases, they would be remanded to the transferor court or the 

district from which they came for trial and the ultimate resolution 

of compensatory damages because there may, for example, be 

issues of individual causation, and no transferee judge wants to 

transfer to himself or herself 300 trials or 400 trials or 1,000 trials 

when you are dealing with litigation of that kind as distinguished 

from a finite group of plaintiffs, as in a patent infringement action. 

Those cases are going to back to the transferee courts as a matter 

of routine practice, if they are not settled, for trial. That is what 

has happened, for example, in the asbestos litigation that was 

managed for so long and so well by Judge Weiner in Philadelphia 

before his untimely death a little over a year ago. Those cases, if 

they were not resolved, were remanded by the thousands to the 

district courts from which they came for trial. 

So I can understand how that aspect of the bill might be a matter of concern, but I suggest that it is not really a threat to the 

rights of anyone. It is truly a bill that is neutral in terms of its effect on plaintiffs as a class or defendants as a class, as I see it. 

[The prepared statement of Judge Hodges appears as a submission for the record.] 

Chairman SESSIONS. Thank you, Judge Hodges. 

Judge Thrash? 

STATEMENT OF THOMAS W. THRASH, JR., U.S. DISTRICT 

JUDGE, U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA, ATLANTA, GEORGIA 

Judge THRASH. Mr. Chairman, thank you for this opportunity to 

testify in my personal capacity before your Subcommittee in support of the Multidistrict Litigation Restoration Act. 

In my almost 9 years as a district judge, I have handled two 

MDL cases. My— 

Chairman SESSIONS. You were the transferee judge in the cases 

that were sent to you for pretrial handling. 

8

Judge THRASH. Yes, sir. My first MDL case got resolved by settlement without too much trouble and with very little effort on my 

part. 

My punishment for that was a case called In re Dippin’ Dots Patent Litigation, which was my second MDL case. Nothing was resolved in that case without a great deal of trouble and effort on my 

part. A big source of trouble was the effect of the Supreme Court’s 

Lexecon decision. 

The Dippin’ Dots case involved a patent on a method for producing a flash-frozen novelty ice cream product. When former distributors began producing a similar product, Dippin’ Dots Inc. filed 

patent infringement and trademark and trade dress infringement 

actions all over the country. The MDL Panel transferred all of the 

cases to me for consolidated pretrial proceedings. 

After 2 years of intense litigation, for the reasons set out at 

length in my written statement, because of Lexecon the main patent infringement case had to be sent back to the Northern District 

of Texas for trial. The Texas judge that had the case in the beginning had quit, was gone. At this point the file was about 20 feet 

long stacked end to end. Just in the MDL proceedings, there were 

746 docket entries. 

I have described the Dippin’ Dots case as a litigation tsunami 

headed for the Northern District of Texas. It was going to hit the 

docket of some poor Texas judge and obliterate everything in sight. 

If I could prevent that from happening, I thought that I had a duty 

to do so. I had made dozens of rulings that would impact the trial 

in large and small ways. And the trial needed to occur quickly before additional litigation between the parties erupted. Realistically, 

I thought that could only happen if I tried the case. 

One group of defendants, however, would not consent to trial of 

the case before me in Atlanta. So, reluctantly, I agreed to go to 

Dallas to try the case there. The process of getting an inter-circuit 

assignment such as this is described in my written statement. 

So myself, my courtroom deputy clerk, my court reporter, four 

Atlanta lawyers, two Kentucky lawyers, and a whole gaggle of 

paralegals occupied the Adolphus Hotel in Dallas for 21⁄2 weeks in 

the fall of 2003 for the trial of the patent claims. 

By the time of the trial, none of the parties and no major witnesses were from Dallas. A second 2-week long trial in Dallas in 

2004 was avoided only by last-minute settlement of the remaining 

non-patent claims. 

In my opinion, this litigation was unnecessarily prolonged and 

expensive to the courts and the parties because of Lexecon. It is a 

real not an imaginary problem. I hope that a legislative solution 

comes soon so that no other district judge has to do what I had to 

do in the Dippin’ Dots case. 

Thank you, and I will be happy to respond to questions at the 

appropriate time. 

[The prepared statement of Judge Thrash appears as a submission for the record.] 

Chairman SESSIONS. Well, first, Senator Schumer and I would 

like to know about this ice cream. 

[Laughter.] 

9

Chairman SESSIONS. Is that the ice cream that has got the little 

dots of ice cream, little round things? 

Judge THRASH. That is it. 

Chairman SESSIONS. I have had it at the baseball park. 

Judge THRASH. And there is more money involved in that than 

you would think, I promise. 

[Laughter.] 

Senator SCHUMER. I thought, Mr. Chairman, that it was a person 

named Mr. Dippin’ Dots. 

[Laughter.] 

Senator SCHUMER. When Judge Thrash went on, I realized it was 

ice cream. 

Chairman SESSIONS. Let me ask this: In terms of judicial—thank 

you, Senator Schumer, and thank you for your leadership on this 

particular issue and your willingness to help move some legislation 

forward. 

With regard to the lawyers and the parties, in your opinion, overall they were not disadvantaged by staying in Atlanta. It provided 

no real benefit to them to move to Texas. Is that correct overall? 

Judge THRASH. Two of the defense attorneys for one group of defendants had their offices in Dallas. For them there was some saving of litigation costs. For everybody else, including the other main 

group of defendants, the cost was much greater to go to Dallas 

than to have the trial in Atlanta. And I would mention that the 

plaintiffs were perfectly happy to try the case in Atlanta. They 

were from Kentucky, and they readily consented, because their 

lawyers were in Atlanta, to try the case in Atlanta. So it was— 

Chairman SESSIONS. Really, the problem was that even though 

in the interest of justice for numerous reasons it would have been 

wiser to have tried it in Atlanta, at least in your opinion, the statute gave any party the power to veto that and have it tried where 

they chose to have it tried. And I guess that is the question we are 

wrestling with today. Should a single party, one of maybe many 

parties be able to do that? And, also, what if in this pretrial process, what if it clearly was overwhelmingly best to try it in Atlanta, 

but you had been less than sympathetic with some of their arguments and had ruled against one party several times, presumably 

because they had made bogus arguments, but you ruled as you 

thought was correct, that party would normally hope that if it was 

sent to Texas, they would get a new judge. Is that correct? So there 

would be an incentive unrelated to the merits of the litigation for 

a party to object to a trial being completed in the transferee jurisdiction. 

Judge THRASH. That is exactly right, Senator. When I first raised 

the subject of the parties all consenting to a trial before me, after 

we had finished the pretrial proceedings, one of the things I said 

was, ‘‘Don’t think you are going to get rid of me just by refusing 

to consent. I will accept an inter-circuit assignment and go to Dallas and try the case.’’ 

I really wasn’t hoping that they would accept that offer, but they 

did. And they said, ‘‘Well, Judge, we would love to have you come 

to Dallas and try the case.’’ 

But you are exactly right. The bill that is pending before the 

Committee restores the right of the judge, where there are imporVerDate 0ct 09 2002 12:06 Aug 24, 2006 Jkt 028335 PO 00000 Frm 00013 Fmt 6633 Sfmt 6633 S:\GPO\HEARINGS\29548.TXT SJUD4 PsN: CMORC
10

tant interests at stake, to control the location of the trial and prevents any one party in a case like mine, where there is only going 

to be one trial, from vetoing the judge’s selection of the proper 

forum. 

Chairman SESSIONS. Judge Hodges, you chair the Multidistrict 

Litigation Committee. What factors do you use—do you look at a 

judge’s caseload and their skill—before you give them a major case 

like this and send it to their district? How do you decide that? 

Judge HODGES. Yes, indeed we do, Senator, the judge’s experience, the judge’s caseload and capacity to take on the added burden, the capacity of the court as a whole. The statute requires the 

consent of the chief judge of the court before any individual judge 

on the court can accept an assignment. So there is that measure 

of protection of the court. 

We also consider whether the potential transferee judge already 

has similar litigation before him or her, which is usual but not always the case. And we consider the accessibility of the court to the 

lawyers who will be traveling in and out for hearings. Frequently, 

in a case of the kind that Judge Thrash had, we would select Atlanta or Dallas or San Francisco or someplace that is readily accessible by air, and any other individual factors in the case that might 

suggest a particular district over another. 

Chairman SESSIONS. But I guess from the point of view of the 

justice system as a whole, most of these MDL cases are large, complex cases, and you try to make sure that you find an excellent 

judge who is capable of handling that, whose caseload is not overloaded at that particular time, and who would be willing to undertake that challenge, instead of having this whole thing fall on 

somebody at random or half a dozen judges, some of whom may 

have very crowded dockets at the time it falls in their laps. Is that 

fair to say? 

Judge HODGES. Absolutely, Senator, and I think anyone who 

would study the record of our selection of transferee judges will 

quickly see that that is so. 

Chairman SESSIONS. I know that Judge Sam Pointer in Birmingham handled a number of those cases. He was a brilliant, brilliant judge, had a tremendous work ethic, and I am sure Judge 

Thrash has those same characteristics. He is from Birmingham, 

too. But I think in many ways it gives the parties the best you 

have to offer in the court system to try their case. 

Judge HODGES. I would certainly agree, and I think that is why 

there really is not much opposition to trial before the transferee 

judges. The experience Judge Thrash had is not unique, but it is 

not unusual, I think. 

Chairman SESSIONS. Well, it has been a number of years since 

the Lexecon decision. The world has not come to an end since this 

self-transfer procedure ended. You have given us one example. Are 

there other examples that would indicate that Congress should act 

and restore the procedure as it existed before Lexecon? 

Judge HODGES. Yes, Senator. In my written statement, I think 

there are two other instances that are identified just as examples, 

one by Judge Feikens in Detroit and another by Judge Jones in the 

Southern District of New York. They tried to utilize the technique 

of remanding a case to the transferor judge so that the transferor 

11

judge could then transfer it back under Section 1404, which is one 

of the techniques that is being utilized now, to tell it like it is, to 

overcome the Lexecon hurdle. But that is a very cumbersome circumstance, and it caused both of those judges to delay trial of their 

own cases until it was determined whether the litigation would return to the court and could all be tried at once. 

I am not going to suggest to you that the Multidistrict Litigation 

Panel is going out of business if this amendment is not passed, because obviously we have functioned, we think, well the last 8 years. 

But this is an important piece of legislation to us and would avoid 

the experience that Judge Thrash had. 

Chairman SESSIONS. Now, what about the transferee judges? Are 

they frustrated like Judge Thrash—or either one of you can comment—by this requirement that it be sent back? 

Judge HODGES. They are, Senator, and— 

Chairman SESSIONS. For the most part, they have mastered the 

case. They are up on all the motions and pleadings and facts, and 

they have pretty much been ready to try, and it gets sent off to 

somebody who knows nothing about it. 

Judge HODGES. And attached to my written statement are comments by no less than 27 Federal district judges describing briefly 

their own experience and difficulties in cases that they handled because of Lexecon, as I say, the difficulties that Lexecon presented. 

Chairman SESSIONS. Judge Hodges, you indicated that you didn’t 

think that there were any winners and losers, any plaintiff or defendant advantage here. 

Judge Thrash, what is your opinion about that? If we pass the 

House bill, will that favor one party or one group of plaintiffs or 

defendants over another? 

Judge THRASH. In my opinion, Senator Sessions, it will not. It is 

party neutral. It is a good-government piece of legislation that in 

some cases is going to benefit one side, if you want to call it a benefit, in that they get their choice of forum; in others, it is going to 

benefit others. 

For example, in my case, it was the plaintiffs that wanted me to 

keep the case and try the case in Atlanta. They had originally filed 

suit in Dallas because they were required to do so by the venue 

rules and the residence of the main defendant at that time. But as 

it turned out in my case, it was then the defendant that wanted 

the case sent back to Dallas. In others, it may be the plaintiff that 

wants the case sent back to the transferor district. 

Chairman SESSIONS. Tell me about the appellate process. There 

are some generalized provisions here, ‘‘interest of justice, convenience of parties,’’ I believe the language is. What kind of appellate 

review would somebody have available to them if they felt wronged 

under the consolidation of the transfer process? 

Judge HODGES. Well, the appellate process, Senator, would be exactly the same as it is now. Any litigant who was aggrieved by the 

entry of the judgment in the case can seek review of any claimed 

error involved in the multidistrict process, which, as I recall, was 

the way Lexecon itself reached the Supreme Court. The statute 

does provide that certain rulings are not reviewable by appeal, but 

application for extraordinary writ is common in those cirVerDate 0ct 09 2002 12:06 Aug 24, 2006 Jkt 028335 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 S:\GPO\HEARINGS\29548.TXT SJUD4 PsN: CMORC
12

cumstances; so that there is appellate review available, if not by direct appeal, then by way of extraordinary writ. 

Chairman SESSIONS. Do you think that the convenience of the 

parties and the interest-of-justice standard is a real test? Does it 

have objective criteria behind it? Or is that just some vague term 

that will let judges do anything they want to do with the case? 

Judge HODGES. Well, that is certainly a fair and important question. The language is somewhat general. It commits itself to the 

discretion, the sound judicial discretion of the jurist who is making 

that judgment. But it is the same language that is used in the 

venue transfer provision of 1404(a) that has been there for years 

and years. It is the same language, essentially, that has been in 

1407 itself from the inception. And I think given the wide variety 

of the kinds of cases that we see, it is the best language that you 

could conjure up to achieve justice in these cases. 

Chairman SESSIONS. But that is, as I am somewhat familiar, the 

language that is already in existence for venue questions, and it 

does have appellate history, and a judge can make objective evaluations under those statutes. Would you agree, Judge Thrash? 

Judge THRASH. Yes, sir, I do. It is the standard that every district judge is familiar with under the general venue transfer provisions, and certainly in the Eleventh Circuit, where Judge Hodges 

and I sit, there is a well- developed body of case law that sets forth 

the factors that are to be considered in making a decision applying 

that standard, one of which is that ordinarily the plaintiff’s choice 

of forum is to receive some deference. That is just one example of 

the types of factors that the established body of appellate court law 

says is to be considered. 

Chairman SESSIONS. And I think that is important. That is a historical principle we have adhered to. But I would have to say that 

we have become a far more mobile society, and cases can often be 

filed in hundreds of different districts. That is a pretty extraordinary privilege to give to a plaintiff who could file it in 100 districts and he can pick the single best one out of that 100 to file his 

lawsuit. And, yes, you can challenge it, but I am not sure—I think 

the existing standards in favor of the plaintiff’s choice of forum are 

strong enough. I am not sure we need to make them any stronger. 

Do you think that we would have a different ratio of self-transfers to remand based on a statutory change than we have today? 

And what kind of change do you think we might have? A different 

ratio of self-transfers, to the transferee judge, to remands back to 

the different judges than we have today, and how big a change 

would there be? 

Judge HODGES. With the statute? 

Chairman SESSIONS. With the statute. 

Judge HODGES. I don’t think there would be a great change, Senator, precisely because, as I said before, take Judge Thrash’s case, 

it only involved two groups of parties essentially involved in one 

piece of litigation, as distinguished from the victims of a mass tort; 

or in the pharmaceutical cases, for example, we have Vioxx going 

on now, being managed very well by Judge Fallon in New Orleans 

as the transferee judge. I don’t think as a practical matter, whatever the law is, that there is any way that Judge Fallon perceives 

13

himself trying all of those cases. If they don’t settle, they are going 

back to the transferor courts from which they came, obviously. 

So it depends on the kind of litigation you are talking about. If 

it is a mass tort situation, that is one thing. If it patent litigation 

or antitrust litigation, possibly even ERISA claims, that sort of 

thing, it would be another. There is more likelihood in those latter 

kinds of cases that there would be a self-transfer than in a mass 

tort case involving injured individuals. 

Chairman SESSIONS. Section (i)(2), subsection (i)(2) in Section 2 

requires the determination of compensatory damages to be remanded unless the transferee court ‘‘also finds, for the convenience 

of the parties and witnesses and in the interests of justice, that the 

action should be retained for the determination of compensatory 

damages.’’ 

Is it correct that this will create a distinction between compensatory damages on the one hand and the determination of liability 

and punitive damages, Judge Thrash? Would it create a presumption in favor of remand for compensatory damages that is not 

present for issues of liability and punitive damages? 

Judge THRASH. No, sir, I don’t think it is going to create a presumption. What I think it does is it requires the transferee judge 

to take a second look at the issue remanding compensatory damages, and if the convenience of the parties, the interest of justice 

require a remand for compensatory damages, Section 2 says that 

it should ordinarily be done. But I don’t think that I would describe 

it as a presumption, and certainly not a presumption with respect 

to compensatory damages that would distinguish them from punitive damages. 

Chairman SESSIONS. Now, I guess each one of these cases, we 

have in our minds a fact situation, but they could be quite different 

fact situations, entirely different issues being presented. But under 

the facts I just raised, it deals with liability and punitive damages. 

So the transferee judge who has—those cases are consolidated before that judge—would have the authority to determine whether or 

not the defendant, would a drug case—a bad drug, maybe, that had 

compensation—had caused injuries be an example? So there would 

be a determination that the company was or was not liable for putting a dangerous product on the market. And then that transferee 

judge could decide the question of whether punitive damages are 

appropriate. 

But if it then turned that liability was found and a punitive damages question is settled, each individual party would then go to 

their own district, presumably, to prove how badly they had been 

physically damaged and so they could ask for compensation individually based on their own particular damages that they suffered? 

Is that the way the system would work practically? 

Judge THRASH. Yes, sir, and I have been both a transferee judge 

and a transferor judge, and the process that you have described is 

very similar to what has happened in the asbestos litigation. For 

example, in the asbestos litigation, Judge Weiner severed the issue 

of punitive damages, retained that, and remanded cases in which 

there was a need for a trial to the district judges for a trial on the 

issue of compensatory damages only. And I have tried an asbestos 

case following that sort of remand. So, yes, sir, that— 

14

Chairman SESSIONS. How did Judge Weiner handle the punitive 

damages? Did he provide some sort of forum, or did he find no punitive damages? 

Judge THRASH. Well, I would defer to Judge Hodges on this, but 

my understanding is that he severed punitive damages because if 

the companies were subject to punitive damages, they would all 

just go bankrupt, and whoever got the first judgment would get it 

all. So the punitive damages claims have just been held in abeyance so to speak so that the compensatory claims could be tried 

without forcing the companies into bankruptcy. 

Chairman SESSIONS. A practical solution. 

Judge THRASH. Yes, sir. 

Chairman SESSIONS. I have wondered that. The first time I have 

understood that after we have wrestled with these asbestos cases 

for a long time. 

Judge Hodges, just briefly, has the Judicial Conference given any 

thought to maybe rethinking or looking creatively at the whole 

panoply of issues raised by the multidistrict tort cases that could 

be consolidated? Are there any things that we really need to do—

asbestos is such a monumental thing, just incredible in size. I don’t 

know whether that would be a mode or not. But there are a number of cases that—are you satisfied that this procedure is sufficient, 

or should we—when you have a single product by a primary defendant that has infected thousands of people, do we need a new 

system of being able to try that, and do we need statutory authority to do so? 

Judge HODGES. Senator, I will have to, frankly, be very careful 

about that because I am not entirely sure that the Conference has 

taken any general position with respect to mass torts in the area 

such as the asbestos cases, and I think perhaps the Conference policy has been to defer to Congress about that. 

I do know that the Congress has endorsed the Multidistrict Restoration Act that I am here testifying about today. I think that is 

the best answer I can give you. 

Chairman SESSIONS. Well, I think about the breast implant 

cases. I know some of those have been consolidated, and other 

cases of that nature. And my question fundamentally is: Is our current law sufficient and could we do better with regard to asbestos? 

We have uniform testimony, and Senator Durbin sort of made a 

counterpoint, but he was consistent with the testimony we had, 

which is, as much money is spent on defense lawyers by the defendant companies as is spent on plaintiff lawyers in those cases. 

That may well be true. But the testimony is about 58 percent of 

the money actually paid out by the defendant asbestos companies 

goes to lawyers; only 40 percent gets to the victims. 

So when you have something that massive, I think it is up to 

Congress to try to figure out a way to get people who are sick compensated promptly without having to go through all this once we 

have concluded there is liability here. 

So that is what we have been trying to wrestle with here. I 

would assume asbestos is so huge it is probably not a good model, 

but if the Conference does have ideas about how to deal with large, 

nationwide—virtually nationwide—cases that could benefit from 

15

consolidation and you need more authority, we would be glad to 

hear from it. 

Judge HODGES. Well, thank you, Senator. I am sure the Conference will respond to that, and I am sure, as you know, it is complicated also by the jurisdiction of the State courts in claims of that 

kind. 

Chairman SESSIONS. Well, that is true. Very true. 

Do either one of you have any further comments you would like 

to make for the record? We will make your full remarks a part of 

the record, if you would like. Anything else that you would like to 

add? 

Judge HODGES. None, except my thanks to you again for hearing 

us today. 

Chairman SESSIONS. We will make these materials a part of the 

record. We have letters from the Judicial Conference in support of 

H.R. 1038, received April 18, 2005; a letter from the Judicial Panel 

on Multidistrict Litigation in support of H.R. 1038, April 20, 2005; 

text of an e-mail from Richard Jaffe, the Administrative Office of 

Courts, to Greg Waring of the Congressional Budget Office regarding CBO’s cost estimate of H.R. 1038; a statement from the Judicial Panel in favor of enacting H.R. 1038 as is, dated July 6, 2005; 

a letter from the Chamber of Commerce of the United States in 

support of H.R. 1038, April 19, 2005; a letter from General Counsel 

for Johnson & Johnson raising potential areas of concern regarding 

H.R. 1038. 

We have sought out those individuals who may wish to submit 

remarks. Really, we have not seen a lot of interest in speaking in 

opposition to this, but our record will be kept open for 7 days, and 

we look forward to reviewing any materials that may be offered 

within the next 7 days for the record. 

If there is nothing else to come before us, we will be adjourned. 

[Whereupon, at 3:27 p.m., the Subcommittee was adjourned.] 

[Questions and answers and submissions for the record follow.]

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