Appendix C

Mass Torts Problems & Proposals

A report to the Mass Torts Working Group

Thomas E. Willging

Federal Judicial Center

January 

This report was undertaken at the request of the Mass Torts Working Group and is

in furtherance of the Center’s statutory mission to conduct and stimulate research

and development for the improvement of judicial administration. This work has

been reviewed by Center staff and publication signifies that it is regarded as responsible and valuable. The analyses, conclusions, and views expressed are those of the

author and not necessarily those of the Federal Judicial Center.

The author is grateful for the capable and substantial research assistance provided

by Rebecca Spiro of Georgetown University Law Center and by Brian Lang of Ohio

State University School of Law and for comments from Joe Cecil, Molly Treadway

Johnson, and Marie Cordisco Leary on an earlier draft. Chief Bankruptcy Judge

David S. Kennedy (W.D. Tenn.) provided insightful and invaluable comments on

an earlier draft of the bankruptcy section.
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Appendix C: Mass Torts Problems & Proposals

Contents

Introduction, 1

I. Problems, 2

A. Overview, 2

B. Are there any problems?, 3

C. Unintended effects of solutions, 5

D. Idealized criteria, 6

E. Problems, 8

1. Defining mass torts, 8

2. Volume of litigation: mass production and marketing, 9

3. Scientific uncertainty, 10

4. Economic incentives: attorneys’ fees, 11

5. Costs and delays, 12

6. Burden on the courts, 14

7. Dispersal of cases in federal and state courts, 15

8. Outcome fairness and consistency , 16

9. Procedural fairness, 17

10. Latent diseases and future claimants , 18

11. Claiming rates , 19

12. Limited, uncertain funding, 20

13. No exit, 20

14. Institutional limitations, 21

F. Summary, 21

II. Proposals to address mass torts problems, 22

A. Case-management proposals, 22

1. Aggregation, 22

a. Background, 23

b. When and whether to aggregate?, 25

c. Aggregation—Settlement classes after Amchem, 31

d. Litigation class actions after Amchem, 37

e. Judicial role in reviewing mass torts class settlements, 37

 f. Aggregation proposals, 39

i. Mass exposure in risk-based torts. , 39

ii. Statistical sampling in mature mass torts., 43

2. Use of court-appointed experts, 55

3. State-federal cooperation , 57

a. Voluntary innovations, 58

b. State-federal legislative proposal, 59

4. Alternative dispute resolution , 60

a. Background, 60
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Appendix C: Mass Torts Problems & Proposals

b. Proposals and critiques, 62

5. Bankruptcy, 67

a. Introduction, 67

b. The bankruptcy process, 67

c. Defining future claims under current law , 68

d. Defining future claims: NBRC and NBC proposals, 70

e. Estimating claims, 75

 f. Estimation of claims in the A.H. Robins reorganization case, 76

g. NBRC claims estimation proposal , 78

h. Channeling injunctions , 78

i. Due process and future claims, 79

j. Bankruptcy and limited fund class actions compared, 81

k. Delays and emergency medical procedures, 84

6. Summary and conclusions, 85

B. Legislative proposals, 86

1. Introduction, 86

2. Professor Cooper’s “bold approach”, 87

3. American Law Institute Complex Litigation Project, 88

4. American Bar Association Commission on Mass Torts, 90

5. Rheingold dissent and proposal, 91

6. Comprehensive plans compared, 93

7. Critiques of the comprehensive proposals, 95

8. Choice-of-law issues, 96

9. Other legislative proposals, 99

a. Federal substantive law, 99

b. Federal substantive law: products liability reform, 100

c. Federal substantive law: wrongful creation of risk, 102

d. Federal substantive law: punitive damages, 105

e. Federal jurisdictional statutes, 109

f. Creating jurisdiction to issue a bill of peace, 111

g. Vaccine compensation-type program, 113

h. Amending class action rules, 114

C. Rule-making proposals, 116

1. Class actions, 116

a. Settlement classes and Rules Enabling Act limits, 116

b. Settlement class proposals, 119

c. Class action trial structure proposals, 122

d. Adequacy of class representation, 123

2. Ethics of mass torts lawyering and judging, 124

3. Conclusion, 126
1

Introduction

This report was prepared at the request of the Mass Torts Working Group created by

Chief Justice William H. Rehnquist in February 1998. Specifically, the report reviews and

organizes current legal and empirical literature on mass torts to address two questions

posed by the Working Group:

1. What problems are associated with mass torts litigation?

2. What proposals have been advanced to address those problems?

Part I begins by asking whether there are mass torts problems that require special

legislative or rule-making attention and proceeds to identify criteria and comparative

bases for recognizing problems. The core of part I is devoted to examining the multifaceted and often overlapping problems, such as costs, delays, scientific uncertainties, and

procedural unfairness, that have been associated with mass torts litigation. The consensus view is that mass torts have created a multidimensional and complex set of problems,

but a minority view points to an ad hoc series of evolutionary actions that have created a

coherent response to the demands of mass torts.

Part II examines three types of proposals to respond to perceived problems posed by

mass torts claims: case-management, legislative, and rule-making. Under case-management proposals, we examine aggregation proposals from a number of angles, including

the timing, the use of and judicial review of settlement classes, litigation classes, proposals to aggregate potential claimants who were exposed to risk-based tortious activity, and

proposals to employ statistical sampling to resolve mature mass torts. We also look at case

management in the form of using court-appointed experts, enhancing cooperation between state and federal courts, employing alternative dispute resolution procedures, and

invoking the bankruptcy process. Discussion of bankruptcy integrates recent legislative

proposals by the National Bankruptcy Review Commission with discussion of current

bankruptcy case-management practices. Discussion of state–federal cooperation includes

consideration of a legislative proposal because it is closely related to the case-management discussion.

Under legislative proposals, we present Professor Edward Cooper’s “bold approach”

to mass torts problems. This allows us to identify at the outset the parameters of a truly

comprehensive resolution of mass torts. We follow with extensive discussion of the American Law Institute’s Complex Litigation Project and the majority and dissenting positions

of the American Bar Association’s Commission on Mass Torts. We compare the major

features of all of the above plans and summarize critiques published in the legal literature. Next we focus on proposals to address choice-of-law issues and critiques of such

proposals. Then we examine federal substantive law approaches that might moot some or

all of the seemingly intractable choice-of-law problems. Federal jurisdictional approaches

come next, including an examination of a bill-of-peace proposal. The federal vaccine
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Appendix C: Mass Torts Problems & Proposals

compensation program is described and discussed briefly. We end the section with a discussion of class action rules changes (e.g., treating a non-opt-out class, rather than the

individual members, as the legal entity; or regulating attorneys’ fees in class actions) that

arguably involve substantive changes and require legislative action.

Discussion of rule-making proposals focuses primarily on class actions, especially proposals dealing with settlement classes, including a summary of Rules Enabling Act limits.

Novel approaches to class action trial structure are examined briefly, as are suggestions

for addressing the adequacy of class representation. Finally, we close with a brief examination of proposals to create new rules designed to address ethical issues that arise in

mass torts lawyering and judging.

In exploring the above issues, we need a working definition of mass torts litigation to

distinguish it from what we call ordinary litigation. Mass torts litigation involves cases,

generally numbering in the thousands, that include claims of personal injuries or property damage caused by exposure to a product or substance or a set of similar products or

substances or a single event.1 All other litigation will be referred to as ordinary litigation.

As discussed below, more precise definitions may be needed in statutes or rules.

I. Problems

A. Overview

Before we summarize and categorize the various mass torts problems that commentators

have identified, we address the threshold issue of whether there are any problems. Then

we discuss briefly, by way of caveat, the unintended effects of prior solutions to perceived

problems. In the core of this section we approach the identification of perceived problems in two ways: first by presenting a number of idealized criteria for judging success in

resolving mass torts problems and then by describing and categorizing the host of specific problems that various commentators have advanced.

1. While property damage litigation is included in this definition of mass torts, such litigation often has a

lesser degree of complexity than litigation that involves bodily injury. Assessment of damages in personal

injury cases typically varies considerably from individual to individual, while property damage typically exhibits less variation.
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Appendix C: Mass Torts Problems & Proposals

B. Are there any problems?

To avoid overstating the complexity of mass torts problems and solutions, we need to

establish a frame of reference. One way to do so is to ask: How do mass torts problems

differ from problems that the civil justice system as a whole has manifested over the years?

To illustrate the force of that question, let us look at a specific instance of an asserted

problem. Commentators have frequently identified high transaction costs, especially attorneys’ fees, as a central problem in mass torts litigation.2 An oft-cited 1983 RAND report

on the costs of asbestos litigation tells us that plaintiffs in that study received, on average,

37 cents of every dollar that defendants and insurers spent on asbestos litigation.3

Missing from the above analysis, however, is any baseline information about the costs

of ordinary litigation. Assuming that in a typical case there is a one-third contingent fee

plus another 7% for plaintiff ’s expenses and assuming equivalent costs for defendants, a

plaintiff would ordinarily receive 42 cents of every dollar spent on the litigation.4 In fact,

later RAND research showed that in non-automobile tort litigation plaintiffs receive, on

average, 43% of total costs and compensation.5

Some commentators, explicitly using the baseline of ordinary civil litigation, have concluded that mass torts do not represent a serious problem for the judicial system. For

example, Professor Siliciano asserts that “long delays, high transaction costs, defendant

bankruptcies, and unpaid claimants” are not pathologies unique to mass torts, but they

are conditions that “will naturally and inevitably arise when any liability-based system of

injury compensation confronts large numbers of similar cases.”6 Indeed, he argues that,

2. See, e.g., Judicial Conference of the United States, Report of the Judicial Conference Ad Hoc Committee on Asbestos Litigation 13 (March 14, 1991) [hereinafter Ad Hoc Committee Report] (“The transaction

costs associated with asbestos litigation are an unconscionable burden on the victims of asbestos disease.”);

Deborah R. Hensler & Mark A. Peterson, Understanding Mass Personal Injury Litigation: A Socio-Legal Analysis, 59 Brook. L. Rev. 961, 963 (“transaction costs are excessive, far outstripping the amounts paid out in

compensation”).

3. James S. Kakalik et al., Costs of Asbestos Litigation (1983). Another 37 cents went to defendants’ attorneys’ fees and expenses while 26 cents went to plaintiffs’ attorneys’ fees and expenses. Id. at vii-viii, Table S.2.

4. To illustrate, assume that a settlement or verdict is $100. Plaintiff receives $60; her attorney receives $40

for fees and expenses. Defendants and insurers incur an additional $40 in fees and expenses. The total payments are $140, of which plaintiff receives $60 or 42%. In asbestos litigation before 1983, plaintiffs’ attorneys’

fees and expenses were 41% and defendants’ attorneys’ fees and expenses were 58%, but we do not know

whether such high defense fees and expenses are typical or whether they remain at such a high level.

5. James S. Kakalik & Nicholas M. Pace, Costs and Compensation Paid in Tort Litigation 74, Fig. 7.2

(1986).

6. John A. Siliciano, Mass Torts and the Rhetoric of Crisis, 80 Cornell L. Rev. 990, 991 (1995).
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Appendix C: Mass Torts Problems & Proposals

in asbestos litigation, aggregating cases in response to perceived problems causes an identifiable problem: the presence of a large proportion of asbestos claims in which the plaintiffs have no physical impairment. Were the cases handled individually, he asserts, nonimpairment cases could be screened out on the merits, preventing the one problem he

concedes has arisen.

Along similar lines, lawyers have argued that class certification in mass torts cases may

complicate legal processes, not streamline them, and create, not resolve, mass filings.7

They contend that courts can effectively approach mass torts by using conventional procedures such as strictly applying joinder rules, limiting consolidations and coordinations

to discovery and pretrial issues, weeding out non-meritorious claims through aggressive

use of summary judgment and other devices for scrutinizing the merits, using ADR procedures, and, in the end, trying cases.8 The resulting pattern of jury verdicts “‘will reflect

a consensus, or at least a pooling of judgment, of many different tribunals.’”9

While not asserting a lack of problems, other commentators have observed the evolution of a mass torts system by a gradual trial-and-error approach through common-law

policymaking. The system that has emerged “has made some functional adaptations while

retaining certain features that . . . many . . . view as dysfunctional.”10 Examples of judicial

managerial adaptations include “novel claims aggregation techniques, statistically-derived

outcomes, . . . more systematic alternative dispute resolution efforts, and coordinated

federal state court proceedings.”11 In the absence of legislative action, judges, attorneys,

and litigants have created a system that responds ad hoc to problems as they emerge

through litigation.

7. See Barry F. McNeil & Beth L. Fancsali, Mass Torts and Class Actions: Facing Increased Scrutiny, 167

F.R.D. 483, 490 (1996) (“class certification encourages litigation by claimants who otherwise would not participate in the legal process”); see generally Ronald D. Krist, Wide View of Tort Reform, 24 Pepp. L. Rev. 889

(1997) (challenging the empirical premises of tort reform and arguing that mass tort litigation has served as

the watchdog of safety).

8. McNeil & Fancsali, supra note 7, at 486, 503–07.

9. Id. at 506–07 & n.143 (quoting Wadleigh v. Rhone-Poulenc Rorer, Inc., 51 F.3d 1293, 1299–1300 (7th

Cir. 1995).

10. Peter H. Schuck, Mass Torts: An Institutional Evolutionist Perspective, 80 Cornell L. Rev. 941, 988 (1995).

11. Id. at 956–57 (footnotes omitted).
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Appendix C: Mass Torts Problems & Proposals

Whether the evolution of such a system is a good or bad idea remains a normative

judgment.12 For purposes of this report, it is sufficient to say that some commentators

present credible arguments that there is a system evolving that satisfactorily addresses the

major problems with mass torts. That is definitely a minority view.

On a more limited plane, Judge Weinstein has expressed the opinion that there is no

problem with the current class action rules. His premise appears to be that the class action device can successfully control mass torts litigation. Judges can use the existing rule

by subclassing, appointing independent lawyers to represent future claimants and unrepresented subclasses, exercise close judicial control of the proceedings, and strictly monitor lawyers’ fees and client relations.13

C. Unintended effects of solutions

Policymakers who examine problems and proposed solutions in the complex arena of

mass torts should also be aware of the history of past proposals. Many past efforts at

solutions—often innovative adaptations of existing procedural rules, statutes, and substantive common law rules—have generated new problems. For example, the use of class

action devices to settle asbestos litigation has run afoul of standards for adequate representation and procedural fairness for potential claimants whose injuries remain latent.

Innovative pursuit of unprecedented aggregative remedies in Amchem and Cimino appears to have the unavoidable effect of adding years in which individual cases were not

scheduled for trial.14 Efforts to address the needs and interests of future claimants outside of the bankruptcy context have revealed new problems relating to procedural fairness, such as notice to and adequate representation of future claimants who may not be

aware of their risk of injury.

Most importantly, success itself may breed problems by creating demand in the form

of new cases. Francis McGovern states it succinctly: “The more successful judges become

at dealing ‘fairly and efficiently’ with mass torts, the more and larger mass tort filings

become.”15 This has come to be know more simply as the “highway” or “Field of Dreams”

12. See Francis E. McGovern, Looking to the Future of Mass Torts: A Comment on Schuck and Siliciano, 80

Cornell L. Rev. 1022, 1027 (1995).

13. See Jack B. Weinstein, Notes for a Discussion of Mass Tort Cases and Class Actions. 63 Brook. L. Rev. 581,

585 (1997) [hereinafter, Weinstein, Mass Tort Class Actions].

14. This is not to say that aggregative procedures in those two cases had no effect. Most of the Cimino

cases settled before trial, and settlement of present claims apparently continued in Amchem while the case

worked its way to the Supreme Court. The parties can continue to use the settlement frameworks created in

those two cases.

15. Francis E. McGovern, An Analysis of Mass Torts for Judges. 73 Tex. L. Rev. 1821, 1822 (1995) [hereinafter McGovern, Mass Torts for Judges].
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Appendix C: Mass Torts Problems & Proposals

phenomenon, depending on one’s frame of reference. The aphorism is, “If we build it,

they will come.” Professor McGovern’s writings convert the aphorism into a more qualified prescription: “Don’t build the highway prematurely,” a prescription that calls for subtle

judgments about the life cycles of cases, maturity, elasticity, and judicial roles.16

Problems with costs and delays may also have been compounded by the elusive search

for a comprehensive solution. For example, Chapter 11 reorganizations represented an

inescapable resolution for many asbestos defendants. In the natural course of handling

each reorganization separately, the parties and the courts have created a proliferation of

asbestos claims resolution facilities that appear to generate unnecessarily duplicative transaction costs and may also contribute to further delay in the final resolution of claims.17

Unavoidably, it seems, solutions give birth to a new generation of problems.

D. Idealized criteria

One approach to identifying mass torts problems is to examine the general principles

underlying proposals to reform the mass torts system. The gap between those principles

and the apparent reality of reported experiences represents a measure of the problems. As

noted above, this approach ignores the baseline problems in ordinary litigation and seeks

a more perfect resolution of mass torts cases.

Judge Jack Weinstein has advanced seven desirable criteria for addressing the demands

of mass torts litigation:

1) The concentration of decisionmaking in one or a few judges; 2) a single forum responsible for resolving legal and factual issues; 3) a single substantive law; 4) adequate

judicial support facilities; 5) reasonable fact-finding procedures, particularly as to scientific issues; 6) a cap on the total cost to defendants such as by limiting punitive damages and allocations for pain and suffering and a method of allocating the cost among

multiple defendants; and 7) a single distribution plan with fairly inflexible scheduled

payments by injury based on the need of those injured, rather than the social and economic status of plaintiffs, and tailored to the availability of private resources.18

16. See id. at 1841–45.

17. At the urging of Judge Charles Weiner, the Judicial Panel on Multidistrict Litigation considered transferring all of the bankruptcy cases to Judge Weiner’s court for coordinated or consolidated proceedings. In

the face of “serious concerns that transfer would adversely impact the . . . bankruptcy cases,” the panel declined to consolidate the proceedings and urged the bankruptcy judges and Judge Weiner to coordinate their

efforts. In re Asbestos Bank. Litig., No. 950, Order (J.P.M.L. Dec. 9, 1992).

18. Jack B. Weinstein, Individual Justice in Mass Tort Litigation 131–32 (1995), quoted in Francis E.

McGovern, Judicial Centralization and Devolution in Mass Torts, 95 Mich. L. Rev. 2077, 2082 (1997) [hereinafter McGovern, Centralization and Devolution].
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Appendix C: Mass Torts Problems & Proposals

Judge Weinstein’s criteria imply that there are problems with dispersal of decisionmaking authority among many judges and forums, a proliferation of substantive laws to

be applied, lack of adequate judicial support facilities, and so forth. By starting with “desirable criteria,” such proposals look to an idealized resolution of problems. Such criteria

make it clear that the measure of successful resolution of the mass torts litigation problems will require creating a system that will be markedly different from existing systems

for managing ordinary litigation.

Along similar lines, District Judge William W Schwarzer (N.D. Cal.), a former director

of the Federal Judicial Center, posited eleven specific standards that a national solution to

asbestos litigation would ideally satisfy. Such a solution would:

1) address the problems of potential claimants whose disease either remains latent or

has not reached its most disabling stage; 2) incorporate all state and federal asbestosrelated cases and grant the power to stay proceedings in courts that are not involved in

implementing the national solution; 3) encompass all claims against all potential defendants relating to exposure to asbestos; 4) create or authorize federal laws, standards,

or rules to govern treatment of discovery, procedural motions, evidence, and substantive law issues, such as punitive damages; 5) provide an alternative to bankruptcy reorganization, enabling defendants to continue to operate viable businesses; 6) create a

fund for present and future victims by identifying and securing the maximum feasible

contributions from each defendant through either bankruptcy or a new alternative; 7)

design a mechanism for existing trusts, generally created under Chapter 11 of the Bankruptcy Code, to link into a single fund with a single administrative structure; 8) reserve

punitive damages until the claims of present and future claimants for compensatory

damages have been satisfied; 9) formulate a streamlined procedure for making claims;

10) provide a reasonable method for compensating counsel in proportion to the time

necessary to present claims to the tribunal(s); and 11) give priority to claimants and

their dependents when the claimant is seriously impaired and has an urgent need for

immediate compensation to pay expenses and replace lost earnings.19

Note that these two sets of criteria approach the issues from different angles. Combining the two approaches would result in an even more complex and ambitious blueprint

for resolving perceived problems. We present these two sets of criteria for their value in

conceptualizing the range of interlocking issues that need to be addressed in crafting an

ideal solution to national mass torts problems.

19. Asbestos Litigation Crisis in Federal and State Courts: Hearings before the Subcomm. on Intellectual

Property and Judicial Administration of the House Comm. on the Judiciary, 102d Cong. 126-127 (1992) (statement of William W Schwarzer, Senior U.S. District Judge and Director, Federal Judicial Center) [hereinafter

Schwarzer, Asbestos Testimony].
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Appendix C: Mass Torts Problems & Proposals

Both approaches represent conceptually powerful ways of identifying possible problems and solutions. On the other hand, implementing these principles will clearly require

legislative actions designed to alter dramatically the status quo. For that reason, achieving

the desired outcomes may be politically impractical. We do not examine these criteria in

depth at this time, but we examine legislative proposals in Part II.B. For now, we present

the Weinstein and Schwarzer criteria to demonstrate the multidimensional complexity of

mass torts problems. Their criteria provide vivid testimony as to why comprehensive

solutions have eluded policy makers.

E. Problems

As the look at idealized criteria shows, one can examine asserted problems in mass torts

litigation from a number of angles and levels. Proposed solutions should be commensurate with the scope and level of the problem addressed. For example, problems inherent

in the mass production of potentially dangerous products cannot be addressed at the

core through procedural rule making. Legislatures and administrative bodies have the

primary roles in defining the standards by which the safety of mass products will be

judged.

1. Defining mass torts

While we posited an arbitrary definition above, referring to thousands of claims, there is

a serious definitional problem that must be resolved before concrete measures to address

mass torts problems can be drafted and applied. What volume and maturity levels should

be required before a group of cases should be treated like a mass tort?

A difficult threshold question is whether a single definition of mass torts can capture

the variety of cases that share the name. As we will see in the discussion at section II.B.5

(“Rheingold dissent and proposal”), there are the rare mass torts, like asbestos and Dalkon

Shield, that encompass hundreds of thousands of individual claims. Can these case congregations be treated the same way as cases like DES and Bendectin that include “only”

thousands of claims? As we will see, there is dissent on that point.

The American Bar Association Commission on Mass Torts found that mass torts “might

well include relatively minor personal injury or property damage claims as well as claims

for economic loss. Similarly, ‘mass tort litigation’ could run the gamut from traditional

negligence or product liability claims to antitrust, securities litigation or a variety of consumer claims.”20 The commission chose to define “mass tort litigation” as involving “at

least 100 civil tort actions arising from a single accident or use of or exposure to the same

20. American Bar Association Commission on Mass Torts, Report to the House of Delegates 5 (1989)

[hereinafter ABA Commission Report].
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Appendix C: Mass Torts Problems & Proposals

product or substance, each of which involves a claim in excess of $50,000 for wrongful

death, personal injury or physical damage to or destruction of tangible property.”21 In

contrast, a dissenting member of the ABA Commission, Paul Rheingold, argued for a

definitional threshold of “10,000 present and reasonably to be expected cases,” to distinguish between routine and problematic mass torts.22 We cite this example simply to illustrate the definitional problem. Other definitions are possible and may be warranted depending on the purpose one has in mind.

A problem related to the definition of mass torts is the extent to which qualifying a

type of litigation as a mass tort lies largely in the hands of attorneys. Given contemporary

mechanisms for recruiting clients by advertising or by screening programs established by

unions or consumer organizations, attorneys can routinely build an inventory of cases

involving a specific product. Damage thresholds can be met when claimants allege serious injuries but have not established the likely cause of those injuries.

In such self-defined mass torts, the volume of cases creates pressure for resolution,

even global resolution, before courts have made determinations about the merits of the

claims. In Professor McGovern’s words, “premature global resolutions can be problematic” because they create the “potential of a prolonged and volatile tail to the tort,” raise

“unrealistic expectations,” and “generate claims that would otherwise have remained dormant.”23

2. Volume of litigation: mass production and marketing

From one vantage, the source of mass torts problems lies in the economic arrangements

that modern industrial society uses to produce and market its products. As Judge Paul

Niemeyer has observed, “[a]s efficiency in production and manufacturing has increased,

. . . design errors are multiplied by factors measured in the millions. An ill conceived pill

or a negligently designed fastener, costing but a few cents each, can place a huge corporation at risk [and] cause serious injury to individuals whose claims cannot be resolved . . .

simply because of the numbers similarly injured.”24 Similar observations can be made

21. Id. at 12.

22. Id. at 8e.

23. McGovern, Mass Torts for Judges, supra note 15, at 1844–45.

24. Paul V. Niemeyer, Remarks to the Institute for Law and Economic Policy, 39 Ariz. L, Rev. 719 (1997).

25. For example, in his comprehensive study of the Bendectin litigation, Professor Michael Green noted

the changes in the state-of-the-science findings in the decade between the first cases and the MDL trial in

1985. In 1976, scientific evidence was quite uncertain. Epidemiological studies were undertaken because of

the litigation and were able to be completed because the latency period was relatively short, bounded by the

length of a pregnancy. See Michael D. Green, Bendectin and Birth Defects 314–15 (1996). The litigation had

a life span of twenty years because it took that long for the science to evolve and be applied to existing cases.
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Appendix C: Mass Torts Problems & Proposals

about environmental damages. If the volume of potential cases is the root cause of mass

torts litigation problems, mass production appears to be the root cause of that volume.

3. Scientific uncertainty

Another aspect of our economic institutions is that we have created a complex biochemical environment into which we introduce novel products. Individual are exposed to multiple products in the course of daily life. Unanticipated biochemical interactions may

provide regular grist for the mass torts mill. Yet, whether a specific product has caused—

or is even capable of causing—injuries to its users represents a difficult question for scientists as well as generalist judges and juries to answer.

For some products, such as asbestos and tobacco, injuries are so numerous within a

defined population that statistically powerful epidemiological studies can yield definitive

results. Yet even with asbestos and tobacco, the interactive effects of these two products

raise complex legal causation questions. For other products, such as Bendectin or dioxin,

measurable exposure is limited to a relatively small portion of the population, and epidemiological studies have been more difficult to conduct and interpret.25

One author concludes, for example, that “[f]or most potentially toxic substances, there

will not be a solid body of epidemiological evidence on which to rely.”26 In such an environment, some see the failure to test the safety of a product as the root cause of speculative litigation that has ensued.27 Indeed, another author labeled as “outrageous fortune”

the phenomena of “blameworthy-but-fortunate” defendants who discovered through postmarketing research that products like silicone gel breast implants may not cause the harms

that some feared, but who had not ruled out those harms through premarket testing.28

Other aspects of uncertainty complicate mass torts litigation. Even when science pro26. Id. at 316.

27. “[T]he time lag between the act and an inference of causation strains the notion of wrongdoing by

imposing an obligation to avoid an act whose adverse consequences may not become known for years.” Margaret A. Berger, Eliminating General Causation: Notes Toward a New Theory of Justice and Toxic Torts, 97

Colum. L. Rev. 2117, 2132–33 (1997) (citing Ernest J. Weinrib, Causation and Wrongdoing, 63 Chi.-Kent L.

Rev. 407, 429–30 (1987) (stating that the origin of the harm is “the defendant’s wrongful risk creation”). See

also Wendy E. Wagner, Choosing Ignorance in the Manufacture of Toxic Products, 82 Cornell L. Rev. 773, 774–

75 (1997) (asserting that “[n]o toxicity research is available for over eighty percent of the chemicals in commerce,” that “current common-law liability rules act to penalize” such research, and that a “manufacturer that

conducts no research can generally avoid liability because plaintiffs and government research programs are

unlikely to conduct scientific research on their own.”).

28. Richard A. Nagareda, Outrageous Fortune and the Criminalization of Mass Torts, 96 Mich. L. Rev. 1121

(1998) (discussing appropriate sanctions for such behavior).
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Appendix C: Mass Torts Problems & Proposals

vides a clear answer that a product has the capacity to cause particular types of injuries,

those scientific findings do not determine whether a plaintiff ’s exposure to a product was

the proximate cause of this plaintiff’s injuries.29 Unless cases are consolidated or treated

as a class, these decisions must be made on a case-by-case basis, and even if cases are

aggregated, the need to show specific causation on a case-by-case basis may persist.

Scientific uncertainty and the consequent legal uncertainty also have significant social

and economic effects. Manufacturers’ decisions about whether to market innovative products are undoubtedly affected by the scientific and legal uncertainties. With marginally

useful products, this uncertainty may provide incentives to test products or refrain from

putting risky products on the market. With essential products, such as vaccines, uncertainties can inhibit the marketing of a product whose benefits clearly outweigh its harms.

In section II.B.9.g (“Vaccine compensation-type program”), we discuss one approach to

this dilemma.

4. Economic incentives: attorneys’ fees

Regardless of whether mass torts cases are handled individually or in aggregates, the volume of the litigation can create opportunities for attorneys on both sides of the litigation

to collect large fees. Many assert that these incentives influence or exacerbate problems

with mass torts.30 Representation of individual plaintiffs on a contingent fee basis becomes more lucrative as the likelihood of recovery increases. Judge Weinstein emphasizes

the need for judges to take “[p]articular care . . . in mass tort cases to ensure that the

contingency fee system and the incentives that it is founded upon operate properly and

are not distorted by the nature and size of the cases.” 31 Amassing an inventory of cases

through advertising or a system of referrals can create attractive economies of scale. Aggregation of claims into a class or consolidated treatment can yield fees that are calculated as a percentage of a large common fund without regard to the number of lawyer

hours needed to achieve that result.32

On the other side of the litigation, defending mass claims in a bet-the-company case

29. See William W Schwarzer, Settlement of Mass Tort Class Actions, 80 Cornell L. Rev. 837, 838 (1995)

(“even when general causation may be established with reasonable certainty, specific causation of particular

injuries is frequently speculative, both because of the limits of science knowledge and the nature of the disease”) [hereinafter Schwarzer, Mass Tort Settlements].

30. See generally Jack B. Weinstein, Ethical Dilemmas in Mass Tort Litigation, 88 Nw. U. L. Rev. 469, 526–32

(1994) [hereinafter Weinstein, Ethical Dilemmas].

31. Id. at 529.

32. See, e.g., Thomas E. Willging et al., Empirical Study of Class Actions in Four Federal District Courts

73 (Federal Judicial Center 1996) (median fee recovery rates ranged from 27% to 30% in class actions studied, but not including any mass torts cases).
12

Appendix C: Mass Torts Problems & Proposals

gives an attorney incentives and opportunities to protract the litigation.33 This attorney’s

client may have converging incentives to wear an opponent down by litigating in a

“scorched earth” manner.34

5. Costs and delays

A standard problem asserted regarding mass torts litigation is that it costs too much and

take too long. For example, one report states that “cases take an inordinately long time to

reach disposition, sometimes concluding long after a plaintiff’s death,” and “transaction

costs are excessive, far outstripping the amounts paid out in compensation.”35 As indicated above, such assertions should be placed in the context of costs and delays in ordinary litigation. In mass torts litigation, a major element of the cost is the seemingly unnecessary repetition of discovery, pretrial motions, and trials for cases that raise the same

or similar issues.

Accurate data on cost and delay are elusive. Complaints about transaction costs typically refer back to a study that was based on data from asbestos cases that closed between

January 1, 1980, and August 26, 1982.36 Such data provide scant support for current generalizations to asbestos or other mass torts for two reasons. First, asbestos litigation is

generally regarded as unique; part of its uniqueness lies in the large number of defendants sued in each case. Because each defendant has costs, defense costs naturally tend to

be higher than in ordinary litigation.37 Second, these data were obtained relatively early

in the history of asbestos litigation, before joint defense ventures like the Asbestos Claims

Facility and the Center for Claims Resolution came into existence, before formulas for

settling cases came to be routine, and before aggregative procedures, including assignment of an MDL judge, were tried.

Data on delays in the asbestos arena are no more precise. Because asbestos cases typically involve scores of defendants, partial settlements do not lead to case terminations.

Regularly kept statistics simply do not allow us to differentiate between the case in which

95% of the defendants have settled and those in which none have settled.

33. See Weinstein, Ethical Dilemmas, supra note 30, at 532. (“Defense counsel in mass tort cases can, in

effect, benefit from their clients’ allergy to conceding liability even when counsel believe that such a concession is ultimately inevitable.”).

34. See id. at 528–29 & n.238 (quoting defense counsel in Haines v. Liggett Group, 814 F. Supp. 414, 421

(D.N.J. 1993) as saying “the way we won those cases was not by spending all of [the company’s] money, but by

making that other son of a bitch spend all of his”).

35. Hensler & Peterson, supra note 2, at 963.

36. See Kakalik et al., supra note 3, at 10.

37. See id. at 3 (finding an average of 20 defendants per case and 300 different defendants overall: “Usually, 20 different defense teams prepare for and participate in the litigation.”).
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Another problematic aspect of transaction costs relates to the duplication involved in

having multiple claims facilities in the form of trusts arising out of Chapter 11 reorganizations or class action settlements.38 In asbestos litigation, these facilities were created at

different times as a result of separate negotiations with each defendant. In mass torts like

asbestos that involve numerous defendants, coordination of payment activity may be

difficult.

As to delays, the length of the queue may extend so long as to raise questions of fairness, of meaningful access to the courts. Judge Parker concluded his due process analysis

in Cimino this way: “unless this plan or some other procedure that permits damages to be

adjudicated in the aggregate is approved, . . . plaintiffs are facing a 100% confidence level

of being denied access to the courts.”39

The timing of rulings on the merits is often problematic in mass torts litigation, and

courts face difficulties in finding procedures that are fair to all parties and suited to the

maturity level of the litigation. Plaintiffs generally desire prompt adjudication and seem

especially disadvantaged by delays. Defendants may also suffer from delays associated

with having immature claims of dubious merit go through a costly and lengthy pretrial

process before being addressed on the merits. Early trials of individual cases may appear

to be a solution, but such cases may be atypical in that they would not have the benefit of

comprehensive discovery conducted in a multidistrict proceeding. Test cases of bellwether

claims may founder on the difficulty of identifying typical claims. At the other extreme,

aggregated trials of immature mass torts claims may bias juries in favor of plaintiffs, at

least on liability issues.40

An element of asserted problems with delay is that courts have apparently been unsuccessful in establishing a priority for claimants with serious injuries over those with

minor injuries. For example, Judge Robert Parker noted that “[f]our hundred and fortyeight members of the [Cimino] class have died waiting for their cases to be heard.”41

Courts have established pleural registries to defer action on asymptomatic asbestos cases

and prevent them from clogging the regular docket,42 but such registries depend on the

cooperation of the parties. Whether registries have been successful has not been evalu38. See discussion supra note 17.

39. Cimino v. Raymark Indus., Inc., 751 F. Supp. 649, 666 (E.D. Tex. 1990), rev’d, 151 F.3d 297 (5th Cir.

1998).

40. See generally Irwin A. Horowitz & Kenneth S. Bordens, The Effects of Outlier Presence, Plaintiff Population Size, and Aggregation of Plaintiffs on Simulated Civil Jury Decisions, 12 Law & Hum. Behav. 209 (1988).

41. Cimino, 751 F. Supp. at 651.

42. See Peter H. Schuck, The Worst Should Go First: Deferral Registries in Asbestos Litigation, 75 Judicature

318 (1992).
14

Appendix C: Mass Torts Problems & Proposals

ated empirically. Complaints about asymptomatic plaintiffs continue to be heard, and

the Amchem settlement seemed to be motivated in substantial part by a desire to pay only

those claimants who are impaired by asbestos disease.43

6. Burden on the courts

Yet another vantage point for examining problems in mass torts litigation looks at the

burdens that such cases pose for judges and courts. Judge Robert Parker concretely illustrates this perspective in chronicling the first two decades of the “odyssey of asbestos

litigation in the Eastern District of Texas.”44 He reports that the class action trial he presided over “consumed 133 days of trial time and produced 25,348 pages of transcript

prepared as daily copy. The docket sheet . . . is 529 pages long. The court has entered 373

signed orders.”45 On the other hand, handling the 2,298 cases individually at a rate of

thirty cases per month would have taken six and a half years, during which time 5,000

new cases would have been filed.46 Burdens like those documented by Judge Parker illustrate the “pressures generated by mass tort litigation” that Judge William Schwarzer finds

“are driving the justice system toward comprehensive aggregation procedures.”47

On the other hand, data from the Federal Judicial Center’s 1987–1993 district court

time study as well as other sources suggest that the nationwide burden of asbestos litigation may have been lower per case than some expect. Apparently because such cases are

often handled in groups and because, as a mature tort, settlement values are relatively

well-established, judicial burdens are limited. In the FJC time study, district judges reported time spent on asbestos cases that justified a case weight of 0.19.48 In other words,

in calculating a court’s weighted caseload, a single asbestos case counts as 19% of an

average federal civil case. In comparison, a non-asbestos product liability case filed originally in federal court has a case weight of 1.74. Asbestos cases are weighted as less burdensome than social security cases (0.48) and prisoner civil rights cases filed against a nonU.S. defendant (0.28).

43. The terms of the settlement provided no compensation to class members who did not have symptoms of scheduled injuries, but class members became eligible for compensation whenever symptoms developed. See Jay Tidmarsh, Mass Tort Settlement Class Actions: Five Case Studies 51–52 (Federal Judicial Center

1998).

44. Cimino, 751 F. Supp. 649, 650.

45. Id. at 653.

46. Id. at 652.

47. Schwarzer, Mass Tort Settlements, supra note 29, at 839.

48. Federal Judicial Center, New Case Weights For Computing Each District’s Weighted Filings Per Judgeship (1993) (unpublished memorandum and table on file with the author).
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FJC and RAND studies of asbestos litigation in the 1980s concluded that most courts

did not devote substantial resources to asbestos cases.49 Of course, these data do not address the strong possibility that courts spent less time per case on asbestos litigation because they did not have the resources available to spend more time. The Judicial Panel on

Multidistrict Litigation’s referral of asbestos cases to the Eastern District of Pennsylvania

presumably further reduced the burden per case.

7. Dispersal of cases in federal and state courts

A major source of problems in mass torts litigation is the absence of a single body of law

that can be applied to cases that arise in different states. This issue has its roots in a federal

system that has traditionally left to the states decisions about standards of conduct like

those implicated in tort law. Mass torts based on products marketed nationally often are

dispersed among most or all of the state and federal courts. As a practical matter, with

limited exceptions, the lack of a single applicable law has limited the availability and effectiveness of aggregative treatment to state courts dealing with cases arising in that state

or single federal districts.50

The absence of a uniform choice of law rule compounds the problem. A judge in a

multidistrict proceeding, for example, may be unable as a practical matter to rule on the

merits of pretrial motions to dismiss or motions for summary judgment because of the

need to apply the conflict-of-law rules as well as the substantive rules of many states. In

such circumstances, peripheral defendants whose cases arose in a number of states may

have no escape from an often extensive and costly pretrial process.51

49. Deborah R. Hensler et al., Asbestos In The Courts: The Challenge Of Mass Toxic Torts 79 (1985) (“No

court for which we have information devotes more than 1 percent of its judicial resources to asbestos case

management even when asbestos cases account for a substantial portion of the civil caseload.”) [hereinafter

Hensler et al., Asbestos in Courts]; Thomas E. Willging, Trends in Asbestos Litigation 110 (Federal Judicial

Center 1987) [hereinafter Trends] (“Most courts have not allocated resources sufficient to schedule asbestos

cases for trial within the same time period as similar nonasbestos cases.”).

50. Even those instances are not without choice-of-law problems because in some cases a state’s choice of

law rules may direct the forum court to apply the law of another state. See, e.g., Steven P. Zabel & Jeffrey A.

Eyres, Conflict-of-Law Issues in Multistate Product Liability Class Actions, 19 Hamline L. Rev. 429 (1996) (“courts

dealing with mass tort litigation have routinely recognized the need to apply the law of the individual class

members’ states to their claims”).

51. Even if there were a single substantive law or a single choice-of-law rule, problems of consistency and

cost might remain if that law were applied by judges and juries dispersed throughout the federal and state

systems. Management of cases by one or a few judges is one of the criteria noted by Judge Weinstein. Weinstein,

Individual Justice, supra note 18, at 131–32.
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Appendix C: Mass Torts Problems & Proposals

Limits on the reach of the federal multidistrict litigation procedure have allowed plaintiffs’ attorneys to avoid federal discovery controls by filing cases in state courts.52 While

most types of cases are dispersed throughout the legal system, in mass torts the dispersal

is more problematic because the exact same conduct resulting in the same types of injuries may lead to different consequences in different jurisdictions. This, of course, is also a

problem with ordinary litigation of similar cases with similar injuries.

8. Outcome fairness and consistency

Problems arise that can be characterized as falling short of achieving major goals of the

tort system, which include compensating the injured and deterring and punishing wrongdoing. In commenting on mass torts class actions, Judge Schwarzer reminds us that a

central problem is the difficulty of accomplishing the primary objective of the tort system, which is “to compensate injured parties in fair and rational ways.”53 A subsidiary

element of that objective is to treat equivalent cases equivalently (which is not to say that

all cases should be treated alike).54

Whether mass torts litigation involves more inconsistency in verdicts and settlements

than ordinary litigation remains unclear. A study of asbestos litigation in the early 1980s

concluded, without citing data, that the “variation in outcome among asbestos victims

whose lives have been seriously disrupted is a complex problem.”55 A related study from

the same period, however, analyzed data from closed asbestos files and revealed seemingly rational relationships between asbestos compensation and factors such as type of

injury, occupational exposure to asbestos fibers, age, smoking, living or deceased status,

and whether the case was settled or tried.56 Variations across jurisdictions—a byproduct

of federalism that is certainly not unique to mass torts—may account for the apparent

inconsistencies.57

52. See Weinstein, Ethical Dilemmas, supra note 30, at 478–79.

53. See Schwarzer, Mass Tort Settlements, supra note 29, at 837.

54. Indeed, Amchem Prods., Inc. v. Windsor, 117 S. Ct. 2231, 2236 (1997), stands for the proposition that

courts need to provide “structural assurance of fair and adequate representation for the diverse groups and

individuals affected” by a mass tort class action settlement.

55. Hensler et al., Asbestos in Courts, supra note 49, at 113; see also Hensler & Peterson, supra note 2, at

963 (“outcomes are highly variable, often seeming to have little relationship to plaintiffs’ injuries or defendants’ culpability”).

56. James S. Kakalik et al., Variation in Asbestos Litigation Compensation and Expenses 18–53 (1984).

57. See id. at 36–38, Table 2.18. See also Schwarzer, Mass Tort Settlements, supra note 29, at 838 (“multiple

jury trials in numerous jurisdictions having different rules of law lead to inconsistent outcomes, complicating the evaluation of cases”).
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Appendix C: Mass Torts Problems & Proposals

Recent studies of variability in the tort system as a whole have concluded that in general jury awards are related to the magnitude of plaintiffs’ losses and that juries exhibit no

greater variability in their damage estimates than do experienced trial lawyers and claims

adjusters.58 Nevertheless, regional variations in jury awards, punitive damages,59 and other

means of compensation for similar injuries, if true, raise questions of outcome fairness

and consistency that may be more acute in mass torts because the source of the injury is

the same product or incident.

Deterrence and punishment may become problematic in the mass tort system. While

there is some evidence that products liability claims outperform other approaches to regulating dangerous products,60 there are plausible complaints that the volume of mass torts

litigation results in multiple punitive damages awards that may exceed reasonable bounds

for deterring or punishing defendants.61

9. Procedural fairness

As discussed above, problems of costs and delays raise issues of procedural fairness. In

addition, when the dominant mode of case disposition in the civil justice system becomes

a pretrial legal ruling or settlement, litigants do not generally experience any personal

involvement with the process; they do not get their “day in court.” In other contexts,

research has indicated that litigants often perceive a process that involves appearance before a third party at a trial or arbitration hearing to be fairer than a process that is simply

based on two-party settlement negotiations or judicial settlement conferences.62 In mass

58. See Neil Vidmar, The Performance of the American Civil Jury: An Empirical Perspective, 40 Ariz. L. Rev.

849, 884–85 (1998).

59. See, e.g., Michael L. Rustad, Unraveling Punitive Damages: Current Data and Further Inquiry, 1998

Wisc. L. Rev. 15, 34, finding that “[f]ifty of the ninety-five asbestos [punitive damages] verdicts were assessed

by Southern juries.”

60. See George Eads & Peter Reuter, Designing Safer Products: Corporate Responses to Product Liability

Law and Regulation (1985).

61. See Steven Garber, Product Liability, Punitive Damages, Business Decisions and Economic Outcomes,

1998 Wisc. L. Rev. 237, 285 (“Punitive damages can—and almost certainly do—have important economic

effects, some of them socially desirable [such as hastening the withdrawal of hazardous products and deterring the withholding of reports to regulatory agencies] and others socially undesirable [such as limiting the

availability of socially valuable products and encouraging use of hard-to-interpret warnings].”). See also Rustad,

supra note 59, at 20–36 (data show that the overall incidence of punitive damages is low, that punitive damage

awards in products liability cases are less frequent than in other types of litigation, and that the amounts

awarded are directly related to the severity of plaintiffs’ injuries).

62. See E. Allan Lind et al., In the Eye of the Beholder: Tort Litigants’ Evaluations of Their Experiences in the

Civil Justice System, 24 Law & Soc’y Rev. 953, 965–67 (1990)
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Appendix C: Mass Torts Problems & Proposals

torts, the number of cases and their similarities to each other make it more likely that

individual cases will be disposed of without trial or hearing, raising questions of procedural unfairness in terms of satisfying litigant interests in participating meaningfully in

resolving their cases. Unfortunately, there are no empirical studies of mass torts litigants’

procedural goals or needs and the extent to which the current system satisfies those aspirations.63

To the extent that aggregation of cases through class actions becomes the solution, the

distance between attorneys and clients results in less client opportunity to participate in

the litigation, whether through an individually retained plaintiffs’ attorney or personally

as a class member.64 Some participants report that similar changes in relationships have

occurred when individual law firms represent a large number of claimants whose cases

are settled in a group.65

For all parties and the courts the burden of engaging in repetitive discovery, pretrial

motions, and trials raises issues of procedural fairness. Policy makers and attorneys have

failed to agree on acceptable procedures that balance defendants’ rights to due process of

law with plaintiffs’ rights to meaningful access to the courts.66 That failure itself raises

questions of fundamental fairness. Delay in resolving the Cimino appeal illustrates this

problem and implies a deep value conflict centered on mass torts litigation.67

10. Latent diseases and future claimants

Mass torts litigation has brought to the surface a unique problem. Epidemiologists often

are able to predict with reasonable scientific certainty that some number of individuals

within a specified group will contract a disease because of a previous exposure to a product or substance. We do not know with certainty which individuals will contract the dis63. See Deborah R. Hensler, A Glass Half Full, a Glass Half Empty: The Use of Alternative Dispute Resolution in Mass Personal Injury Litigation, 73 Tex. L. Rev. 1587 (1995) (“it is time to bring plaintiffs into the

dialogue on mass personal injury litigation”) [hereinafter Hensler, A Glass Half Full]. For a view of traditional

client participation in ordinary litigation, see generally Douglas Rosenthal, Lawyer and Client: Who’s In Charge?

7 (1974).

64. See generally Judith Resnik et al., Individuals Within the Aggregate: Relationships, Representation, and

Fees, 71 N.Y.U. L. Rev. 296 (1996).

65. See John D. Aldock & Richard M. Wyner, The Use of Settlement Class Actions to Resolve Mass Tort

Claims after Amchem Products, Inc. v. Windsor, 33 Tort & Ins. L.J. 905, 909–10 (1998).

66. See, e.g., American Law Institute, Complex Litigation Project 19 (1993) (“The procedural fairness

achieved by processing claims individually may sacrifice the fairness of reaching a just result in a timely

fashion.”).

67. The Cimino appeal was filed on May 3, 1993, and was decided on August 17, 1998. Cimino v. Raymark,

751 F. Supp. 649, 650 (E.D. Tex. 1990), rev’d, 151 F.3d 297 (1998).
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Appendix C: Mass Torts Problems & Proposals

ease and how many of those individuals will sue when their injuries become manifest.68

Unlike the future automobile accident or assault and battery, the perpetrator of the future injury is known and likely has limited assets available to compensate victims. How to

manage competing present and future claims to those assets raises complex problem involving prediction of claiming rates and financial planning to reserve funds for future

claimants.

Traditional aggregative methods for resolving litigation resolution—such as through

an opt-out class action or setting a time limit for filing a claim in bankruptcy—do not fit

latent claims.69 A major problem with future claims is the challenge of providing notice

to those who are not yet aware that they are potential claimants.70

11. Claiming rates

Social scientists have established that for traditional torts a small portion of those injured

file suit to recover damages.71 One social scientist concluded that “[o]ne of the most

remarkable features of the tort system is how few plaintiffs there are” in relation to in68. See discussion infra notes 71–73.

69. See, e.g., John C. Coffee, Jr., Class Wars: The Dilemma of the Mass Tort Class Action, 95 Colum. L. Rev.

1343, 1354 (1995).

70. See Richard L. Marcus, They Can’t Do That, Can They? Tort Reform Via Rule 23, 80 Cornell L. Rev. 858,

894–95 (1995) (“Unless claimants with unmanifested claims are absolutely protected against having to decide now whether to exclude themselves from a class action, the ultimate question for mass tort class actions

is whether they can adequately identify and inform absent class members of their rights.”); Linda S. Mullenix,

Class Actions, Personal Jurisdiction, and Plaintiffs’ Due Process: Implications for Mass Tort Litigation, 28 U.C.

Davis L. Rev. 871 (1995) (analyzing the issue of plaintiffs’ due process in mandatory settlement class actions

and concluding that mandatory class actions that provide damages without providing due process protection

for plaintiffs may be constitutionally deficient); Ralph R. Mabey & Jamie Andra Gavrin, Constitutional Limitations on the Discharge of Future Claims in Bankruptcy, 44 S.C. L. Rev. 745, 785–86 (1993) (concluding that

due process requirements do not prevent the discharge of future claims in bankruptcy, but the bankruptcy

code “omits the roadmap”).

71. See Richard E. Miller & Austin Sarat, Grievances, Claims, and Disputes: Assessing the Adversary Culture,

15 L. & Soc’y Rev. 525, 544–45 (1981) (3.8% of tort grievances result in court filings; 0.8% of discrimination

grievances resulted in court filings); Deborah R. Hensler et al., Compensation for Accidental Injuries in the

United States 110 (1991) (“overall, about one injury in ten leads to an attempt to collect liability compensation. But about half of all those injured in motor vehicle accidents make some informal or formal attempt to

collect from another party to the accident. In contrast, in non-work, non-motor-vehicle accidents, only three

injuries out of 100 lead to liability claims.”); Patricia M. Danzon, Medical Malpractice: Theory, Evidence, and

Public Policy 25 (1985) (“at most, 1 in 10 incidents of [medical] malpractice resulted in a claim . . . and at

most 1 in 25 received compensation”).
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Appendix C: Mass Torts Problems & Proposals

stances of negligent injury.72 In mass torts litigation, however, the rates of filing claims

appear to be much higher. This may flow from notice campaigns that are required by the

aggregate treatment of such claims in bankruptcies or class actions. Higher rates may also

flow from the incentives and opportunities that attorneys have to advertise and amass an

inventory of claims.

In assessing whether higher claim rates are a problem, one needs to identify potential

benefits as well. While higher claiming rates impose burdens on courts, defendants, and

other plaintiffs, they may also represent a more complete form of justice. Aggregating

mass torts claims may provide an opportunity to correct more systematically the harms

that products have caused, to meet more consistently and completely the compensation

goals of the tort system, and to calibrate the deterrent effect to the magnitude of the

harm.73

12. Limited, uncertain funding

Linked to compensation of future claimants is the problem of identifying the assets that

might be used to satisfy their claims. Standards have not been established to guide courts

and parties in deciding how to allocate the assets of an ongoing business and protect the

interests of current and future claimants. The alternative procedures invoked include

Chapters 7 and 11 of the Bankruptcy Code and, if it passes constitutional muster in the

Ahearn case, the mandatory limited fund class action under Federal Rule of Civil Procedure 23(b)(1)(B). Such devices for final national (or, sometimes, global) resolution of

litigation were not designed for mass torts; each application to mass torts has been problematic. In the absence of clear legal standards, courts have often waited patiently for the

parties to negotiate the amounts to be allocated to financing the on-going business and to

compensating mass torts victims.

13. No exit

An elastic mass torts litigation based on latent claims has no natural termination. The

lack of a suitable conclusion is a byproduct of the latency of the claims. A willing, even

repentant, defendant cannot bring together all its liabilities, pay fair value, and terminate

72. Michael J. Saks, Do We Really Know Anything About the Behavior of the Tort Litigation System—And

Why Not?, 140 U. Pa. L. Rev. 1147, 1183 (1992) (citing empirical studies of medical malpractice activity,

general civil grievances and disputes, and actions by people with disabling injuries).

73. See David Rosenberg, Individual Justice and Collectivizing Risk-Based Claims in Mass-Exposure Cases,

71 N.Y.U. L. Rev. 210 (1996) [hereinafter Rosenberg, Individual Justice].
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Appendix C: Mass Torts Problems & Proposals

the litigation. Even by seeking bankruptcy reorganization,74 which most companies seem

to want to avoid, corporate defendants have no dependable way of arranging for peace.

Avoiding the conflicts of interest identified in Amchem still leaves a residue of difficult, if not intractable, problems relating to notifying future claimants as well as unsettled

questions relating to the authority of federal courts to enjoin litigation of related claims

in state courts. Because of the magnitude of mass torts class settlements and the high

degree of attorney control over relevant information, establishing judicial standards and

procedures for reviewing class action settlements seems essential. Such standards and

procedures would guide judges in exercising meaningful oversight of mass torts settlements.75

14. Institutional limitations

For the judiciary to address problems with mass torts litigation raises questions of the

limits of its institutional powers. Substantive tort law was not designed to address latent

mass torts. Congress has been reluctant to federalize products liability laws because they

have traditionally been within the province of the states. Most of the problems we identified have substantive law overlays, particularly problems relating to choice of law, substantive liability and damage standards, bankruptcy mechanisms, and jurisdictional bases.

Even adapting the multidistrict litigation statute to the needs of mass torts litigation will

require congressional action. Modifying procedural rules will generally not suffice to resolve the major issues that have been raised. Beyond legislation, constitutional due process limits may lead the courts to exercise self-restraint in addressing potential solutions

related, for example, to mandatory class actions or to binding future claimants in bankruptcy proceedings.

F. Summary

Commentators agree that mass torts litigation poses problems for our system of civil

litigation and that such problems are of a far greater magnitude than problems posed by

ordinary civil litigation. While there are limited empirical data to support that assessment, the vast numbers of cases generated under the mass torts rubric seems to have led

many commentators to ignore the lack of systematically collected empirical information.

Commentators present what is—at least when viewed in a composite form—a multidi74. See Mabey & Gavrin, supra note 70, at 749 (observing that the Manville reorganization did not discharge future claims, but channeled them into a trust because that was “the pragmatic solution to an intractable problem”)

75. See Schwarzer, Mass Tort Settlements, supra note 29, at 838, 843–44.
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mensional mosaic of a complex set of problems. In counterpoint, several commentators

paint a somewhat different picture—one of an ad hoc series of evolutionary actions that

have created a system capable of coping in rational ways with the volume of cases undeniably associated with the mass torts phenomenon.

II. Proposals to address mass torts problems

In Part II, we present and examine proposals that commentators have advanced for addressing the myriad problems posed. We examine three types of proposals:

• case-management approaches, which assume that current law, rules, and procedures apply;

• legislative approaches, which seek to change the substantive and procedural laws

governing mass torts; and

• rule-making approaches, which are limited to the authority granted the judicial

branch under the Rules Enabling Act.

Because the case-management approach supplies the techniques that support the evolutionary argument summarized at the end of Part I, we start by examining case-management proposals. We include discussion of legislative proposals related to state-federal

cooperation and to bankruptcy because those discussions are closely related to case-management proposals discussed in this section.

A. Case-management proposals

1. Aggregation

Aggregation—combining hundreds or even thousands of similar claims into a single unit

for case management—is designed to address primarily problems of volume and accompanying issues of costs and delays. Tension arises between addressing those goals and

arguably competing goals of ensuring procedural fairness to all parties.

The fundamental debate regarding case management of mass torts litigation has been

over whether or not to aggregate cases for pretrial and trial or settlement purposes. Even

the commonly held view that aggregation for discovery is desirable76 seems to be open to

question given recent experiences with the repetitive stress injury cases.77

76. For example, an articulate and vigorous opponent of aggregation for trial asserts that “joint discovery

on common issues is desirable in most mass tort cases.” Roger H. Trangsrud, Joinder Alternatives in Mass Tort

Litigation, 70 Cornell L. Rev. 779, 782 (1985) [hereinafter Trangsrud, Joinder Alternatives].

77. See discussion infra notes 101–111.
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The consequences of aggregation can be to create a mass tort. To capsulize a nowfamiliar metaphor, Professor McGovern has coined the mantra: “If you build a superhighway, there will be a traffic jam.”78 Professor Siliciano, arguing that the mass torts

phenomenon is a crisis of rhetoric, attributes the asbestos problems to a failure to apply

the groundrules of the tort system, allowing unmeritorious claims to clog the new superhighway.79 Whether there is a middle ground—a way of resolving numerous meritorious

claims by dismissing those without merit—seems unclear.

The aggregation debate became crystallized in the Cimino litigation and in other cases

that have followed the Cimino model. In that district-wide class action, Judge Robert

Parker, with the consent of the plaintiffs, used stratified80 statistical sampling and extrapolation from the sample to produce verdicts for a class of 2,298 claimants based on

jury verdicts for 160 representative plaintiffs. The U.S. Court of Appeals for the Fifth

Circuit reversed and held that the sampling and extrapolation procedure violated defendant Pittsburgh-Corning’s Seventh Amendment right to an individualized jury trial on

actual damages to each plaintiff.81 Before we examine that debate in depth, for background, we review materials related to less dramatic forms of aggregation.

a. Background

In the early years of asbestos litigation, when the term “mass torts” was still fresh,

courts routinely consolidated asbestos litigation, generally under Federal Rule of Civil

Procedure 42, for pretrial purposes, and, in some courts, for trial purposes as well.82 Published in 1985, the Manual for Complex Litigation, Second83 [MCL 2d] devoted a chapter

to “Mass Disasters and Other Complex Torts Cases” in which the board of editors urged

courts to assign related cases to the same judge84 and observed that “[c]ases may frequently be consolidated for pretrial proceedings, and even for trial.”85 Because of the

Advisory Committee’s familiar caveat, courts were “reluctant to authorize class action

treatment of personal injury claims,” but the authors of MCL 2d found the class action

approach to be “not necessarily impermissible in all mass tort litigation.”86 Empirical

78. McGovern, Mass Torts for Judges, supra note 15, at 1840.

79. Siliciano, supra note 6, at 1010–11.

80. The sample is considered stratified because the court took separate samples from groups consisting of

individuals with one of five distinct asbestos diseases.

81. Cimino, 151 F.3d 297, 322 (5th Cir. 1998).

82. See Thomas E. Willging, Asbestos Case Management: Pretrial and Trial Procedures 15–17 (Federal

Judicial Center 1985) [hereinafter Asbestos Case Management].

83. Manual for Complex Litigation, Second at 291–303, § 33.2 (Federal Judicial Center, West ed., 1985).

84. Id. at 293.

85. Id. at 297.

86. Id. at 298.
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studies of asbestos litigation confirmed that courts were following the invitation in the

MCL 2d and aggregating cases into consolidations and, in a few instances, class actions.87

As the volume of mass torts litigation increased, class action treatment expanded. In

1991, the Judicial Conference’s Ad Hoc Committee on Asbestos Litigation looked toward

aggregative solutions to asbestos litigation, recommending that “Congress consider legislation to expressly authorize consolidation and collective trial of asbestos cases.”88 The

report, which was adopted by the Judicial Conference in March 1991, expressly urged

authorization for “class action . . . trials,” noting that legislation would “obviate present

objections to that procedure under Rule 23.”89

The Ad Hoc Committee’s report apparently contemplated using the class action-sampling-extrapolation approach that Judge Parker used in Cimino v. Raymark, despite referring to that approach as “‘the most radical solution.’”90 The Judicial Conference, in adopting

the Ad Hoc Committee’s report, requested the Standing Committee on Rules of Practice

and Procedure to “direct its Advisory Committee on Civil Rules to study whether Rule 23

of the Federal Rules of Civil Procedure should be amended to accommodate the demands

of mass tort litigation.”91 The Advisory Committee’s efforts in that regard are the direct

antecedents of the creation of the Mass Torts Working Group.

In 1995, the Manual for Complex Litigation, Third noted that “courts have increasingly utilized class actions to avoid duplicative litigation in mass torts cases, although

primarily in the context of settlement.”92 Coincidentally, about the time MCL 3d was

published, mass torts class actions underwent a period of intense scrutiny and disfavor,

the long-term effects of which remain to be seen. Several courts of appeals rejected class

certification in mass torts contexts.93 To a considerable extent, these decisions are grounded

87. See Trends, supra note 49, at 90–98; see also Hensler et al., Asbestos in Courts, supra note 49, at 52–67.

88. Ad Hoc Committee Report, supra note 2, at 36. This recommendation was a backup to the Ad Hoc

Committee’s plea for a national legislative asbestos compensation approach. Professor Robert Bone reports

that the Ad Hoc Committee “recommended sampling in an earlier draft report,” but did not include that

explicit recommendation in its final report. Robert G. Bone, Statistical Adjudication, Rights, Justice, and Utility in a World of Process Scarcity, 46 Vand. L. Rev. 561, 565 (1993).

89. Ad Hoc Committee Report, supra note 2, at 36.

90. Id. at 21, 41.

91. Id. at 2, 37–39.

92. Manual for Complex Litigation, Third § 33.262 (Federal Judicial Center 1995) [hereinafter MCL 3d].

93. Castano v. American Tobacco Co., 84 F.3d 734 (5th Cir. 1996); In re American Medical Sys., Inc., 75

F.3d 1069 (6th Cir. 1996); Matter of Rhone-Poulenc Rorer, Inc., 51 F.3d 1293 (7th Cir. 1995); Valentino v.

Carter-Wallace, Inc., 97 F.3d 1227 (9th Cir. 1996).
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in the serious difficulties associated with choosing substantive laws to be applied in a

nationwide class action that spanned states with different choice of law and substantive

law rules. In Amchem Products, Inc. v. Windsor,94 the Supreme Court affirmed the Third

Circuit’s decision that a “sprawling” nationwide opt-out settlement class of present and

future asbestos claimants failed to satisfy the predominance and adequacy of representation standards of Federal Rule of Civil Procedure 23 [Rule 23].

It is in this post-Amchem world that we examine questions of case management and

aggregation as proposed solutions to mass torts problems. Other forms of aggregation,

such as bankruptcy and Judicial Panel on Multidistrict Litigation (MDL Panel) consolidations will be discussed separately.

b. When and whether to aggregate?

Arguably the most important decisions in mass torts litigation involve whether to

aggregate cases and, if so, when. Various commentators express varying opinions on

whether and when and for what purposes cases should be aggregated. Opinions on the

issue continue to evolve as the system gains experience with various types of mass torts.

Early experience with asbestos litigation may have set a high mark for aggregation as

individual courts generally decided to consolidate cases within their own districts and

assign them to single judges.95 Combined with the J.P.M.L.’s decision not to consolidate

the cases on a national level, local consolidations of asbestos cases produced a system in

which aggregation played a major role in the midst of a wide range of experimental case

management.

While we need to discuss the asbestos experience, we should keep in mind that asbestos provides a poor model for policy makers to follow. Because of what we now recognize

as its elasticity, asbestos was the first and most dispersed of the major mass torts. For that

reason, it has provided the baseline mass torts experience for many judges, lawyers, and

researchers. Yet, as many have observed, asbestos is a unique mass tort, one that has not

been duplicated in the two or more decades of mass tort litigation. Not only is asbestos a

mature mass tort, it approaches senility. Not only is it elastic, it may be endless.96 Lessons

94. 521 U.S. 591 (1997).

95. See Trends, supra note 49, at 31–46.

96. Francis E. McGovern, The Defensive Use of Federal Class Actions in Mass Torts, 39 Ariz. L. Rev. 595,

605–06 (1997) [hereinafter McGovern, Defensive Class Actions] (“The asbestos litigation is highly elastic in

that the reservoir of potential plaintiffs is virtually limitless and plaintiffs will emerge as long as damages can

be obtained cost effectively . . . . There is no light at the end of the asbestos tunnel . . . .”).
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about when and whether to aggregate other mass torts cases should come from elsewhere.97

Professor McGovern recommends that judges “adopt multiple strategies” for coping

with the timing questions, “letting the marketplace of litigation play out in the early stages

and using more comprehensive case-management techniques as the mass tort matures.”98

Even when a case has been consolidated by the MDL Panel for pretrial discovery, the

pretrial (transferee) judge retains the option of trying single cases rather than pursuing a

global solution prematurely.99

J.P.M.L. consolidation for pretrial purposes itself involves aggregating federal cases

and may confer mass tort status on case congregations that might otherwise be resolved

in a disaggregated fashion. At a minimum, MDL consolidation means that all parties to

the litigation will invest considerable resources in discovery and other pretrial activity,

pitting organized and well-financed plaintiffs’ attorneys against organized and well-financed defendants’ attorneys.100

In the repetitive stress injury [RSI] cases (which ultimately focused on injuries allegedly caused by computer keyboards), defendants “vigorously opposed” MDL consolidation and the panel declined to transfer cases.101 Individual trials in seven different jurisdictions resulted in defense verdicts or judgments. Those outcomes, according to one

commentator who has been involved on the defense side of the litigation, led to a dramatic reduction in the rate of filing of new computer keyboard claims.102 While the RSI

story may not be finished, what was once compared to asbestos litigation and described

as “the mass tort of the nineties”103 seems to have paused far short of that mark.

The above is not to suggest that the approach in the computer keyboard-RSI cases

should be applied across the board to all potential mass torts. The appearance of success,

97. McGovern, Mass Torts for Judges, supra note 15, at 1836–37. (“These [asbestos] torts are unique and

need not taint our understanding of other mass torts.”).

98. Id. at 1844. McGovern defines maturity as occurring when “there has been full and complete discovery, multiple jury verdicts, and a persistent vitality in plaintiffs’ intentions.” Id. at 1843.

99. See id.

100. See Debra E. Pole, Effective Management of Mass Tort Litigation, ALI-ABA Course of Study 169,

172–74 (July 19, 1996).

101. George M. Newcombe, RSI Defendants Fight for Due Process: “Mass Torts” Needn’t Always Be Massive,

63 Def. Couns. J. 36, 39 (1996). The panel was “not persuaded . . . that the degree of common questions of fact

among these actions rises to the level” required by section 1407. In re Repetitive Stress Injury Prods. Liab.

Litig., No. 955, 1992 WL 403023 at *1 (J.P.M.L. Nov. 27, 1992).

102. Newcombe, supra note 101, at 40.

103. Stanley J. Levy, Repetitive Trauma: The Mass Tort of the Nineties, in Practising Law Institute, Commercial Law and Practice Course Handbook Series, Sept. 6, 1995.
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especially in the early stages of a potential mass litigation, can be controlled by a defendant’s

careful choice of cases to litigate, settling the more meritorious ones and trying the rest.104

The appearance that such cases do not have merit may prove to be deceptive, but one

expects that if there are many meritorious cases, they will surface eventually. If there are

enough meritorious cases, settlement of those cases can be expected to keep the litigation

alive.

The repetitive stress injury cases also were unusual in the disparity of claims. Plaintiffs

sought to consolidate a host of claims about computer terminals, cash registers, supermarket workstations, stenographic machines, and computer “mouse” devices, manufactured by different defendants, used in different work settings, and allegedly causing a

“diverse array” of ailments.105 Resisting aggregation may be particularly apt when the

litigation is so “sprawling.”106

On the other hand, rejecting all forms of aggregation (including MDL consolidation)

may deprive all litigants of the opportunity to save discovery costs. Many commentators

assert that consolidation for pretrial purposes is generally a good idea for both sides of

the litigation. For example, Debra Pole, an attorney representing defendants in mass torts

litigation, asserts that “[c]entralization is the key for effective management of mass tort

litigation” and that for defendants, “consolidation of cases for pre-trial matters may prove

to be much less expensive than handling mass tort litigation pre-trial on an individual

basis.”107 In the Bendectin litigation, after some initial plaintiffs’ verdicts and equivocal

regulatory actions led to increased filing, defendants sought MDL consolidation “to mitigate the litigation demands of multiple, geographically dispersed cases on the company

and its counsel.”108

McGovern observes that the “Judicial Panel on Multidistrict Litigation and analogous

state entities locate potential mass torts early in their life cycle in order to consolidate

pretrial discovery.”109 Yet, despite its familiarity and routine invocation, the decision to

consolidate for pretrial purposes may be the crucial stage in defining a mass tort. The

104. See, e.g., Paul D. Rheingold, The MER29 Story—An Instance of Successful Mass Disaster Litigation, 56

Calif. L. Rev. 116, 138 (1968), cited in Richard L. Marcus & Edward F. Sherman, Complex Litigation 127 (3d

ed. 1998) (“The defendant could and did select the cases it wanted tried. Good cases approaching trial were

settled. . . The success of these tactics is evident in verdicts for the defendants in the first three cases tried.”)

105. In re Repetitive Stress Injury Litig., 11 F.3d 368, 371 (2d Cir. 1993).

106. Amchem, 117 S. Ct. at 2250.

107. Pole, supra note 100, at 171.

108. Green, supra note 25, at 164, cited in McGovern, Centralization and Devolution, supra note 18, at

2085–86.

109. McGovern, Mass Torts for Judges, supra note 15, at 1844.
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alternative of initial case-by-case adjudication seems to have become submerged as the

art of managing mass torts has evolved.110 As Professor Resnik has commented, “the aggregation of civil cases . . . has moved from being the exceptional and specially justified

event to the more ordinary and expected response whenever patterns of similar cases

appear in federal courts.”111

In his continuing chronicles of evolving approaches to mass torts litigation, McGovern

highlights the “devolution” model, which has reemerged in the 1990s. In that model, decision making regarding immature and elastic mass torts devolves in a decentralized

manner to local non-MDL judges and to litigants themselves. Devolution counters the

trend of the 1980s toward increasing aggregation.112 In calling for multiple strategies,

McGovern urges that the strategy of trying cases in the “one-riot, one-Ranger mode”

needs to give way—at least in the early stages of a mass tort’s life cycle—to the “original

concept of trying single cases even under the rubric of the MDL.”113 The call is for selective use of all the options, depending on the characteristics of tort cases presented to the

courts.

Generally, current statutes and rules provide little or no guidance about the timing of

consolidation.114 The American Law Institute’s (ALI) Complex Litigation Project proposes to change that situation in two ways. First, the project proposes standards to govern

the consolidation of cases within the federal courts, including specific factors relating to

the fairness of consolidation to the parties.115 As to timing, one of the factors to be con110. For example, the MCL 3d assumes that there should be centralized management from the outset,

deferring question of how trials should be handled. MCL 3d § 33.21 (“All related litigation pending in the

same court . . . should ordinarily be assigned to the same judge, at least for pretrial management. . . . The court

may determine that separate trials should be held of individual actions . . . .”).

111. Judith Resnik, From “Cases” to “Litigation,” 54 Law & Contemp. Probs. 5, 6 (1991).

112. McGovern, Centralization and Devolution, supra note 18, at 2079–81.

113. McGovern, Mass Torts for Judges, supra note 15, at 1844.

114. Aside from its reference to pretrial proceedings, the Multidistrict Litigation statute, 28 U.S.C. § 1407,

gives no guidance on the timing of the decision. The panel sometimes denies consolidation because one or

more of the cases are approaching trial. See In re Asbestos & Asbestos Insulation Materials Prods. Liab. Litig.,

431 F. Supp. 906, 909–10 (J.P.M.L. 1977). Likewise, Fed. R. Civ. P. 42 permits consolidation whenever “actions

involving a common question of law or fact are pending before the court.” While Fed. R. Civ. P. 23(c)(1)

directs a determination on class status “[a]s soon as practicable after commencement of an action brought as

a class action,” its language does not limit the timing of a motion to convert an ordinary action into a class

action.

115. American Law Institute, supra note 66, at section 3.01 (Standard for Consolidation).
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sidered is “the stages to which the actions already commenced have progressed.”116 Second, the Project calls for the creation of a special Complex Litigation Panel to make the

consolidation decisions.117

The MCL 3d cautions that “aggregation, whether through consolidation or class action treatment, may not be appropriate for some litigation.”118 Judge Weinstein recommends that courts should evaluate the merits “at every phase of a litigation,” including

the decision on whether or not to certify a class.119 Others recommend that courts use

summary judgment and other pretrial scrutiny of the merits to “weed out non-meritorious cases that often accompany a mass case.”120 Presumably this level of screening would

precede decisions on whether to aggregate or not.

Experimental social science research has shown that aggregating cases for trial purposes can have distinct effects on jury verdicts. Horowitz and Bordens systematically examined the effect of giving a jury information about the number of people affected by

defendant’s alleged conduct. When informed that hundreds of individuals claimed injuries arising from the same exposure to toxic chemicals, “juries quite rationally concluded

that when a great many people claimed injuries, the defendant was more likely to have

been culpable [than if the jury were not so informed].”121 Combining cases that involve

separate incidents or even separate acts by different defendants, as in the original RSI

litigation,122 may disadvantage those defendants.

 On the other hand, depriving juries of information about related cases by trying mass

injury cases separately seems likely to affect case outcomes to the disadvantage of plaintiffs. The concept of a “case congregation,” defined as “‘a group of cases that . . . share

common features, that are shaped by a common history, that are subject to shared con116. Id.

117. Id. § 3.02. For a discussion of those factors and a comparison with the prerequisites for certification

of a class action, see Richard L. Marcus, Confronting the Consolidation Conundrum, 1995 B.Y.U. L. Rev. 879,

898–921.

118. MCL 3d, supra note 92, at section 33.26, citing In re Repetitive Stress Injury Litig., 11 F.3d 368 (2d

Cir. 1993).

119. Weinstein, Mass Tort Class Actions, supra note 13, at 590 (1997); see also McNeil & Fancsali, supra

note 7, at 517 (without determining the merits, courts should look beyond the pleadings and down the road

of the litigation in deciding whether class certification is appropriate).

120. McNeil & Fancsali, supra note 7, at 504.

121. Kenneth S. Bordens & Irwin A. Horowitz, Mass Tort Civil Litigation: The Impact of Procedural Changes

on Jury Decisions, 73 Judicature 22, 27 (1989); see also Horowitz & Bordens, supra note 40, at 217–19.

122. See Newcombe, supra note 101, at 38.
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tingencies, and that lean into a common future’”123 may be helpful when deciding whether

aggregating—and allowing juries to see the full context—is appropriate.

As noted above, the current state of the art of mass torts case management is based on

the premise that “different judicial strategies should be used at different stages of the life

cycle.”124 Specifically, in the early stages, judges should employ a traditional approach,

which is to “view each case discretely, thus ignoring the effects of cases on one another.”125

At the latter stages, “once the full dimensions of the tort are recognized, a more activist

model is appropriate.”126

Following the above approach, a judge would “learn all aspects of the litigation and

develop a comprehensive management plan to resolve the cases in an orderly manner.”127

This should occur only after the litigation has reached a level of maturity in which “a

rough equilibrium of case values ensues as the cases become more routinized and the

parties’ contentions become more defined.”128

Once a mass tort reaches maturity, Professor McGovern has outlined a four-step process for resolving mature mass torts. His proposal directly addresses defendants’ expressed

need for a way to end the litigation and may also address ways of treating future claimants

fairly. The steps are: (1) consolidating all cases of a single mature mass tort into one

forum; (2) resolving all common issues in that forum; (3) collecting information concerning all injuries; and (4) developing a systematic process for resolving all remaining

issues.129

While waiting for maturity before aggregating a mass tort appears to be the procedure

advocated by the vast majority of commentators, there are dissenting views. Elizabeth

Cabraser, an experienced plaintiffs’ class actions attorney, argues that the “immature tort”

is an “immature concept.”130 In her view, the danger lies in applying a purportedly rigorous, scientific-sounding concept such as that of “immature tort” before determining

whether there is evidence that individual litigation and trials of the plaintiffs’ claims will

123. Joseph Sanders, The Bendectin Litigation: A Case Study in the Life Cycle of Mass Torts, 43 Hastings L.

J. 301, 308 (1992), quoting Marc Galanter, Case Congregations and Their Careers, 24 Law & Soc’y Rev. 371, 372

(1990).

124. McGovern, Mass Torts for Judges, supra note 15, at 1841.

125. Id. at 1840.

126. Id. at 1842.

127. Id. at 1840.

128. Id. at 1843.

129. Francis E. McGovern, Resolving Mature Mass Tort Litigation, 69 B.U. L. Rev. 659, 690–94 (1989).

130. Elizabeth J. Cabraser, The Road Not Taken: Thoughts on the Fifth Circuit’s Decertification of the Castano

Class, SB24 ALI-ABA 433, 450 (1996).
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actually be cost-effective for the litigants and the court system. Further, Cabraser argues

that there is no accepted objective standard as to how many trial outcomes would constitute maturity. The concept of the “immature tort” is largely unsupported, at least to date,

by any widely accepted body of evidence or jurisprudential consensus.131 Cabraser’s view

seems compatible with Judge Weinstein’s view, stated above, that judges should take into

account the merits of litigation before deciding whether or not to aggregate.132

At a more conceptual level, Professor David Shapiro argues for a class action model

that views the class as the entity that drives a class action. Under this model, “it makes

little sense to defer class certification of what appears to be a mass tort . . . until the

requisite number of individual actions have been ground through the system.”133 He poses

an alternative that might retain many of the benefits of the maturity theory, that is, to

certify a class provisionally, conduct discovery and perhaps bellwether trials, then revisit

the certification issue.134 Similarly, as we will discuss below, Professor David Rosenberg

would aggregate all mass exposure cases and provide compensation to all who develop

injuries arising from the exposure.135 Rosenberg’s approach makes the question of maturity less relevant, if not moot.

Implementing the majority view on the timing of aggregation seems to call for substantial judicial restraint in the face of pressures to manage mass torts collectively. A challenge is to focus on individual aspects of immature mass torts cases when large groups of

such cases are filed together. The culture of mass torts case management that developed

in the past two decades created institutional patterns that encourage and support early

and active case management.

c. Aggregation—settlement classes after Amchem

As noted above, in Amchem Products, Inc. v. Windsor136 the Supreme Court affirmed

the Third Circuit Court of Appeals’ rejection of a proposed nationwide settlement class

action involving hundreds of thousands of class members and twenty defendant asbestos

manufacturers who constituted the Center for Claims Resolution. In an opinion by Justice Ginsburg, the Court observed that the proposed class was “sprawling” and ruled that

its common elements failed to meet the predominance requirement of Fed. R. Civ. P.

23(b)(3).137 The Court also held that the class did not meet Fed. R. Civ. P. 23(a)(4)’s

131. Id.

132. See discussion supra note 119.

133. David L. Shapiro, Class Actions: The Class as Party and Client, 73 Notre Dame L. Rev. 913, 935 (1998).

For further discussion of Professor Shapiro’s model, see text infra notes 614–22 and 673–75.

134. Id. at 935–36.

135. See discussion infra notes 185–98.

136. See discussion supra notes 93–94.

137. Amchem, 117 S. Ct. at 2250.
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adequacy of representation requirement because the interests of some class members and

representatives conflicted with interests of other members and representatives, especially

those of future claimants.138 The Court also expressed concern about—but did not rule

on—the difficulties of providing adequate notice to future claimants who might not know

that they were exposed to asbestos dust or injured by it.139

In a set of case studies prepared for the Federal Judicial Center, Professor Jay Tidmarsh

extracted the following three propositions from the Amchem decision:140

1. “class actions can sometimes be used to resolve mass tort controversies;”141

2. “a settlement class action . . . [in the mass tort context] must meet most but not

all of the requirements of litigation class actions, such as fairness, predominance

of common issues, and adequacy of representation, but a court may take the

settlement into account in determining whether a class action is a superior way

to adjudicate the controversy;”142 and

3. “the decision to certify a settlement class action in Georgine [Amchem] was erroneous” because it failed to satisfy the adequacy of representation requirement

of Rule 23 (a)(1) and the predominance of common issues requirement of Rule

23(b)(3).143

Other commentators, including a number of judges, have made similar points. Case

law after Amchem has cautiously continued to permit the class action device to be used to

settle mass torts and fraud cases. Attorneys John Aldock and Richard Wyner, who both

represented the Center for Claims Resolution in Amchem, conclude that the Court’s decision “is merely a call for caution, and not an invalidation of settlement class actions.”144

District Judge Alicemarie Stotler, then Chair of the Standing Committee on Rules, said “if

there was one word to distill the result of the Amchem decision . . . it would probably be

highlighted in yellow, all caps, bold, and italicized, saying ‘CAUTION.’”145 Judge Edward

Becker, author of the Third Circuit opinion that was affirmed in Amchem, concluded that

“class actions are or should be alive and well, but not everything after Amchem is going to

survive.”146

138. Id. at 2251.

139. Id. at 2252.

140. Tidmarsh, supra note 43.

141. Id. at 25.

142. Id. at 26–27.

143. Id. at 27–29.

144. Aldock & Wyner, supra note 65, at 920.

145. Stephen A. Saltzburg (moderator), The Future of Class Actions in Mass Tort Cases: A Roundtable

Discussion, 66 Fordham L. Rev. 1657, 1662 (1998).

146. Id. at 1690.
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Commentators seem generally in accord that the central limits of Amchem seem to be

cohesiveness, adequacy of representation, and notice to future claimants. We address them

in that order.

Aldock and Wyner observe that while Justice Ginsburg said that “the fact of settlement is relevant and eliminates any need to inquire as to manageability,” she also indicated that “other, unnamed Rule 23 criteria warranted undiluted or even heightened scrutiny—presumably, the criteria that relate to the ‘cohesiveness’ of the class.”147 Judge Becker

succinctly noted a similar dichotomy in the Court’s analysis of manageability: “I think

sprawling classes are done.”148 Indicia of sprawl in Amchem were the wide range of differences in the asbestos products, claimants’ exposures to asbestos, medical histories, severity of injuries, and smoking history.149 Cases with similar disparities in the products involved, levels of exposure, severity of injuries, and other contributing factors should be

carefully scrutinized under the Amchem standard.

Likewise, Aldock and Wyner conclude that settlement classes can be crafted that will

satisfy the adequate representation prong of Amchem. They assert that a “prudent reading” of the Amchem Court’s holding “would suggest that subclasses, with separate representatives and counsel, should be established where a strong case can be made that groups

of class members have conflicting settlement goals.”150 Other commentators concur.151

The call for subclasses may also be necessary to address what might otherwise be intractable choice-of-law problems in nationwide mass torts class actions.152

147. Aldock & Wyner, supra note 65, at 913.

148. Saltzburg, supra note 145, at 1680. Judge Becker saw the opinion’s statement that “[s]ettlement may

be taken into account” as evidence of a compromise “because it is one line, unexplained” and “she gives it

with one hand, she takes it away with the other.” Id. at 1673. On the cohesiveness point, see also Stephen B.

Burbank & Linda J. Silberman, Civil Procedure Reform in Comparative Context: The United States of America,

45 Am. J. Comp. L. 675, 687 (1997) (“the Court found that the ‘sprawling class’ of future asbestos claimants,

some of whom suffered present injuries and some of whom were only exposed, did not satisfy Rule 23 requirements”).

149. Amchem, 117 S. Ct. at 2250.

150. Aldock & Wyner, supra note 65, at 914.

151. See Saltzburg, supra note 145, at 1681–82 (Judge Weinstein recounts his experience in the Manville

case in which the first settlement was “properly reversed” for lack of subclasses and then resettled “on a

different basis”); Joseph F. Rice & Nancy Worth Davis, Judicial Innovation in Asbestos Mass Tort Litigation, 33

Tort & Ins. L. J. 127 n.95 (1997) (“The Supreme Court’s pronouncement on subclasses is a procedural hurdle

rather than a substantive obstacle in future class actions.”).

152. See Larry Kramer, Choice of Law in Complex Litigation, 71 N.Y.U. L. Rev. 547, 584–87 (1996); American Law Institute, supra note 66, at section 6.01(e) (Statutory Recommendations and Analysis). Professor

Kramer also notes that using statewide class actions may be a better approach to consolidating dispersed

mass tort cases. See also discussion infra notes 509–525.
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Before Amchem was decided, Professor Roger Cramton wrote that “[a]dequate representation of a huge class of future tort claimants is possible, if at all, only if the lawyers

negotiating for the class are representative of all the major divisions and groups within

the class.”153 He suggested two ways of doing so: the trial judge could either “designate the

lawyers for the class, giving careful consideration to the differing interests of various class

members” or “appoint lawyers for identifiable subclasses to supplement the class counsel.”154 Those suggestions seem particularly apt after Amchem.

The Amchem Court articulated concerns about “the gravity of the question whether

class action notice sufficient under the Constitution and Rule 23 could ever be given to

legions so unselfconscious and amorphous” as the Amchem class.155 Commentators on

the notice issue have expressed caution about whether or not the Court’s concerns could

be addressed satisfactorily. Cramton finds it “difficult or impossible to give . . . future

claimants [who do not have a present awareness of injury or who have no current legal

claim] the required notice of the class action and opportunity to opt out that the due

process clauses . . require.”156 Providing such class members a “back-end opt-out,” as in

the heart valve and breast implant litigation, would be an alternative way to provide due

process.157

Similarly, Burbank and Silberman see the notice procedure used in Amchem, with its

“heavy reliance on media announcements,” to have tested “the outer limits of due process, let alone of Rule 23.”158 In their opinion, approval of such notice “may require renewed attention to other interests at the expense of actual notice.”159

The lawyers are more optimistic that notice issues can be addressed. Aldock and Wyner

rely on historical tests of notice—that it only need be “reasonably calculated” to achieve

actual notice and that it be compared to other customary and feasible substitutes.160

153. Roger C. Cramton, Individualized Justice, Mass Torts, and “Settlement Class Actions”: An Introduction, 80 Cornell L. Rev. 811, 828 (1995).

154. Id.

155. Amchem, 117 S. Ct. at 2252.

156. Cramton, supra note 153, at 835–36.

157. Id. at 836. A back-end opt-out permits the class member to make the decision about opting out after

an injury has become evident, rather than at the time of the class certification or settlement approval.

158. Burbank & Silberman, supra note 148, at 687.

159. Id.

160. Aldock & Wyner, supra note 144, at 920.
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Several commentators conclude that a major effect of Amchem will be to drive settlement class actions into state courts.161 Elizabeth Cabraser predicts that the “trend toward

the litigation and settlement of nationwide personal and non-personal injury product

claims in state, rather than in federal courts, has likely been accelerated by the near

confluence of Amchem and the Supreme Court’s affirmance of state court jurisdiction to

resolve nationwide class claims (including exclusively federal claims).”162

After Amchem, lower courts have continued to approve class action settlements. In

two of the most important mass torts settlement class actions, Rule 23(b)(1)(B) “limited

fund” classes were involved. In what is commonly known as the Ahearn litigation,163 the

court of appeals reaffirmed its decision to uphold the district court’s approval of a settlement involving a single asbestos defendant. In addition to distinguishing Amchem on the

grounds that common interests in a limited fund predominate, the court of appeals noted

that decisions about allocating the fund among class members were not made under the

settlement but were assigned to the post-settlement claims administration process. Thus,

“all members of the future claimant class are treated alike.”164 The Supreme Court granted

certiorari, and the mass torts world awaits the Court’s guidance.

In the orthopedic bone screw litigation,165 Judge Louis Bechtle approved a limited

fund settlement with a single defendant, Acromed Corporation. As was the case in Ahearn,

the bone screw settlement was not “sprawling” and all claimants were treated equally,

leaving individual damage allocation to a post-approval claims administration process.

Unlike both Ahearn and Amchem, there were no future claimants in the bone screw litigation; all claimants were likely to know soon after surgery whether they had a claim.166

161. See Saltzburg, supra note 145, at 1663 (Melvyn Weiss, an attorney specializing in plaintiffs’ class

actions, predicted “there will be more cases filed in the state courts . . . the Court has opened the door to

defendants to get global relief in a state court case”); Cabraser, supra note 130, at 19–21 (Amchem accelerates

the trend toward nationwide class actions in state courts).

162. Cabraser, supra note 130, at 19, citing Matsushita Elec. Indus. Co. v. Epstein, 516 U.S. 367 (1996).

163. In re Asbestos Litig., 134 F.3d 668 (5th Cir.), cert. granted sub nom. Ortiz v. Fibreboard Corp., 118 S.

Ct. 2339 (1998).

164. Id. at 670.

165. In re Orthopedic Bone Screw Prods. Liab. Litig., 176 F.R.D. 158 (E.D. Pa. 1997). Professor Elizabeth

Gibson is preparing a detailed case study of that litigation for the benefit of the Mass Tort Working Group.

166. Id. at 173 (“Individuals who have undergone this type of procedure know that the surgery has occurred.”).
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Outside the mass torts context, consumer fraud and other settlement class actions

continue to be approved after Amchem.167On the other hand, an equal number of settlement class actions appear to have been rejected during the first year of the post-Amchem

era.168

While Amchem has provided a roadmap for mass torts settlement classes, the question

remains as to whether such settlements should continue to be proposed and approved

and under what circumstances. The debate that preceded the Amchem decision was vigorous, even vituperative, and summarizing it exceeds our current needs.169 Commentators attacked the settlement class format as inviting collusion and providing incentives

for a “reverse auction” in which defendants would sell res judicata to the lowest bidder.170

After Amchem, we can expect that debate about settlement class actions to continue.

In papers presented before Amchem and published shortly after, Professor McGovern

reviews the arguments for and against settlement class actions, from the left, the right, the

courts, and the pragmatists. He leaves us with this question: “whether the mass tort phenomenon has created such burdens on our system that tinkering, radical solutions, or

inaction are the warranted solutions.”171

Professor John Leubsdorf rejects McGovern’s suggestion that parties could consent to

class settlements that would benefit both sides. On the one hand he argues that in the case

of asbestos such consent appears to be have been coerced by the refusal of the MDL judge

to set federal cases for trial.172 On the other hand, he argues that the pragmatic justification of using settlement classes to stem the flow of an unlimited supply of asbestos cases

could better be answered by either better judicial screening or by consigning the tortfeasors

to pay or go into bankruptcy.173

167. See Elizabeth Cabraser, Trends and Developments in Mass Torts and Class Actions in Year One of the

Post-Amchem Era 7–11, ALI-ABA Course of Study (Aug. 19–21, 1998). After the above article was written,

the Third Circuit approved a settlement class resolution of a major consumer fraud case. In re Prudential Ins.

Co. of Am. Sales Practices Litig., 148 F.3d 283 (3d Cir. 1998).

168. See Cabraser, supra note 167.

169. See generally Symposium, Mass Tortes: Serving Up Just Desserts, 80 Cornell L. Rev. 811 (1995).

170. See generally Coffee, supra note 69; Susan P. Koniak, Feasting While the Widow Weeps: Georgine v.

Amchem Products, Inc., 80 Cornell L. Rev. 1045 (1995).

171. McGovern, Defensive Class Actions, supra note 96, at 614.

172. John Leubsdorf, Class Actions at the Cloverleaf, 39 Ariz. L. Rev. 453, 459 (1997), citing McGovern,

Defensive Class Actions, supra note 96, at 612.

173. Leubsdorf, supra note 172, at 460.
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d. Litigation class actions after Amchem

Despite Amchem and the host of court of appeals decisions rejecting litigation class

actions prior to the Amchem decision,174 federal courts have recently certified several mass

torts litigation class actions. In one mass exposure case, a district judge certified a class

that he had previously decertified because of an adverse circuit ruling in another mass

exposure case. His opinion carefully analyzed the proposed classes, certified subclasses

for medical monitoring, negligence, and strict liability claims, and rejected a subclass for

punitive damages.175 Where differing laws of various states might produce different results, the court created subclasses of the major groups of state laws.

In another mass exposure case, this one also post-Amchem, the district judge conditionally certified a medical monitoring class and two property damages classes that asserted claims that defendant’s release of radioactive and other hazardous materials increased plaintiffs’ risk of contracting serious latent diseases, such as cancer, and contaminated their property.176

Not surprisingly, given the additional scrutiny called for by Amchem, a number of

courts have refused to certify mass torts class actions or have decertified them since the

Supreme Court’s decision.177 All in all, it seems that courts are likely to continue to use

class actions, including settlement class actions, in mass torts litigation on a highly selective case-by-case basis.

e. Judicial role in reviewing mass torts class settlements

Amchem dealt primarily with standards for certifying a settlement class. While the

Court held that a finding that a settlement was fair was no substitute for findings that the

putative class met the standards set by Rule 23(a) and 23(b)(3),178 the Court did not

reach the question of whether the lower court’s findings of fact regarding the merits of

the settlement could be upheld.179

Several commentators, including two district judges, have proposed guidelines that

may help guide judges in reviewing class action settlements. Judge William Schwarzer

174. See supra notes 163–68.

175. In re Telectronics Pacing Sys., 172 F.R.D. 271 (S.D. Ohio 1997) (class of implantees with allegedly

defective lead “J” wires in their pacemakers).

176. O’Connor v. Boeing N. Am., Inc., No. 97-1554 (C.D. Cal. order re class certification filed July 13,

1998).

177. See Aldock & Wyner, supra note 65, at 915–16.

178. Amchem, 117 S. Ct. at 2248–49.

179. For the district court’s extensive review of the fairness of the settlement, spanning 18 days and

hearing from 25 witnesses, see Georgene v. Amchem Prods., Inc., 157 F.R.D. 246 (E.D. Pa. 1994); see also

Tidmarsh, supra note 43, at 46–58.
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Appendix C: Mass Torts Problems & Proposals

proposes a list of eleven factors for a court to consider under Rule 23(e), including:

• “whether persons with similar claims will receive similar treatment, taking into

account any differences in treatment between present and future claimants;”

• “whether the representation of members of the class is adequate, taking into account the possibility of conflicts of interest in the representation of persons whose

claims differ in material respects from those of other claimants;” and

• “whether the compensation for loss and damage provided by the settlement is

within the range of reason, taking into account the balance of costs to defendant

and benefits to class members.”180

Following the Amchem ruling, Judge Manuel Real of the Central District of California

urged that judges “know the details of how a settlement has been reached,” which “may

require consultation with independent experts—available under Rule 706 of the Federal

Rules of Evidence—who have knowledge of the business or industry that gave rise to the

injury or damages.”181 Courts also need to scrutinize the ability of defendants to “fulfill

the obligations undertaken either in terms of money, action, or inaction.”182 Finally, “[t]rial

judges should actively oversee the settlement process and should try to accomplish the

following:

• “Ensure absent class members are properly represented, notified, and accorded

due process;

• “Prevent collusion between counsel for the class and defendant during the settlement process;

• “Evaluate the effects of res judicata and collateral estoppel on the proposed settlement and record objections to settlement on the record; [and]

• “Assess fairness and reasonableness of the settlement to all class members, and

make findings as to the value to each individual plaintiff.”183

Other commentators have provided discussion of principles to guide judges in reviewing class settlements.184

180. Schwarzer, Mass Tort Settlements, supra note 29, at 837, 843–44. For further discussion in the context

of rule-making proposals see text infra notes 660–664.

181. Manuel L. Real, What Evil Have We Wrought: Class Action, Mass Torts, and Settlement, 31 Loy. L.A. L.

Rev. 437, 448–49 (1998).

182. Id. at 449.

183. Id.

184. See generally, e.g., Carrie Menkel-Meadow, Ethics and the Settlement of Mass Torts: When the Rules

Meet the Road, 80 Cornell L. Rev. 1159 (1995); see also Cramton, supra note 153.
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 f. Aggregation proposals

In this section we discuss two types of aggregation that are controversial: collectivization of claims in risk-based mass exposure torts and statistical sampling to calculate individual damages in a class action trial. Some commentators assert that statistical sampling

is clearly unconstitutional and at least one court of appeals has so held regarding one

particular use of statistical sampling in asbestos litigation. Collectivization is equally controversial. Why should we even discuss these radical proposals when they seem to be

either academic or moot? Our main reason for discussing them at some length is that the

concepts underlying these proposals seem to have helped shape private settlements in

mass torts litigation. Also, these concepts arguably have influenced and may continue to

influence the development of the common law on questions of mass exposure. Both the

shaping of settlements and the underlying common law regarding aggregate treatment of

risk-based behavior have obvious implications for managing mass torts litigation.

i. Mass exposure in risk-based torts

A leading proponent of aggregation of certain mass torts claims—he calls it collectivization—is Professor David Rosenberg.185 One knowledgeable commentator remarked

that “the most striking feature of his model is the extent to which common-law courts

have already incorporated its main elements—class actions, proportional liability, damage scheduling, averaged judgments, insurance-fund judgments, fee- and cost-shifting

arrangements—into the current mass tort system.”186

Rosenberg’s view of the benefits of collective treatment of “mass exposure” or “riskbased” cases (i.e., cases in which individuals have been exposed to a product or substances

that increased their risk of incurring harm in the future) draws from substantive tort law

policies of deterrence and compensation. In brief, he argues that collective treatment of

such cases fully achieves both deterrence and compensation goals.

To illustrate the concepts that Rosenberg addresses, let us sketch out a concrete example. In the Bjork-Shiley heart valve litigation, plaintiffs as a class alleged that they had

185. See generally, Rosenberg, Individual Justice, supra note 73; see also David Rosenberg, The Causal

Connection in Mass Exposure Cases: A “Public Law” Vision of the Tort System, 97 Harv. L. Rev. 849 (1984)

(proposing a “public law” view—that is, one that enhances deterrence as well as compensation goals—that

mass exposure cases should be allowed to proceed as class actions and that causation should be determined

based on the proportion of fault attributable to manufacturers of toxic agents and also proposing remedies

such as damage scheduling and insurance-type judgments).

186. Schuck, supra note 10, at 981. For example, Schuck finds that the “global settlements in Georgine and

the silicone gel breast implant litigation include damage schedules which are, in effect, insurance-fund judgments for future claims.” Id. at 981–82.
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been exposed to an elevated risk that their heart valves might fail without warning. Although consensual (at least in the sense that counsel for the class and counsel for defendant agreed), the settlement in that case shows how collective adjudication of a mass

exposure case might operate. Among other remedies, the settlement provided a standing

offer to pay any class member whose valve fractured between $500,000 and $2,000,000,

depending on the claimant’s age and income.187 This standing offer to settle future claims

operated like an insurance policy.

Rosenberg asserts that collectively providing the equivalent of insurance to those who

suffer harm as a result of the mass exposure fully satisfies compensation goals. In his

words, “the insurance model fully justifies class action settlements that trade fear of cancer and other risk-based mental distress claims for corresponding increases in scheduled

payments to compensate for the accrued ultimate injury.”188 As in the heart valve settlement, the damage schedule provides fair compensation in the individual case by taking

account of the severity of injuries. Those who do not incur injuries are not compensated.

Fear of harm is mitigated by the insurance features, which mirror an economic institution society has created to deal with fear of injury or death. Insurance is a method of

compensation that rational claimants would agree to before knowing the extent of any

injuries they might incur.189

Rosenberg posits that “[o]ptimal deterrence is achieved by threatening the defendant

with the aggregate, average loss (pecuniary and nonpecuniary) attributable to its tortious

conduct.”190 Where a defendant knowingly increases a toxic-related risk, deterrence goals

can only be met by aggregating claims based on the proportion of the risk attributable to

defendant’s conduct. Indeed, Rosenberg asserts, collective treatment of damages so com187. See Bowling v. Pfizer, Inc. 143 F.R.D. 141 (S.D. Ohio 1992), affirmed, 103 F.3d 128 (6th Cir. 1996),

cert. denied sub nom. Ridgeway v. Pfizer, Inc., 118 S. Ct. 263 (1997). Plaintiffs could reject the settlement offer

and proceed to arbitration or litigation, in which case they would be subject to all defenses. The class action

settlement also provided a modest payment to recipients to address the fear of failure, earmarked funds to be

used for research to improve the ability to identify and remove defective valves, and permitted and paid for an

operation to remove valves in limited circumstances. The court approved an opt-out class settlement. See

Tidmarsh, supra note 43, at 33–45 for a description and analysis of the settlement. Tidmarsh characterized

the litigation as “relatively immature.” Id. at 34.

188. Rosenberg, Individual Justice, supra note 73, at 245.

189. See id. at 245–47. Professor Resnik makes the related point that aggregative procedures are more

likely to provide compensation to a fuller range of the injured than is case-by-case litigation. See Judith

Resnik, Litigating and Settling Class Actions: The Prerequisites of Entry and Exit, 30 U.C. Davis L. Rev. 835,

843–44 (1997) [hereinafter, Resnik, Litigating and Settling].

190. Rosenberg, Individual Justice, supra note 73, at 239.
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Appendix C: Mass Torts Problems & Proposals

pletely accomplishes deterrence goals that punitive damages become superfluous.191 Collectivization and individual compensation values might possibly conflict in other contexts, but Rosenberg’s analysis of the tort system’s deterrence and compensation functions shows such clashes do not occur in his proposed way of responding to mass exposure torts.

According to Rosenberg, collective litigation adds objectivity to the legal process. Tort

concepts such as negligence, failure to warn, and strict liability are premised on notions

of objective reasonableness that may get lost in the subjectivity of examining a single

plaintiff’s story in individual litigation. For example, a failure to warn claim can get focused on what a particular plaintiff knows about the dangers of a product, in contrast to

what a typical user might know. Aggregating claims encourages plaintiffs’ and defendants’ to direct their resources toward providing objective proof applicable to the aggregate.192

All of the above benefits, Rosenberg asserts, outweigh individuals’ interests in participating in the litigation or having their day in court. He asserts, provocatively, that plaintiffs “are never made better off by being vested with a property right . . . to an inefficient

day in court, to personal control over their claims, and to other anticollectivist procedures.”193 He argues that his “hypothesis is confirmed by empirical evidence of the high

rate of purchase of insurance with subrogation, and of settlement of most civil litigation—settlements based on patterns of averaged liability and compensation values derived from a few fully tried cases.”194 In the subrogation and settlement contexts, individuals bargain away their opportunity to present their own claims to a court in exchange

for a fixed and certain payment.

Rosenberg recognizes that procedural values relating to individual participation in

and control of litigation serve important functions in certain contexts (“individual justice values”). He argues, however, that such values have no place when, because of collective treatment, claims—such as many individual’s fear of cancer claims—gain access to

the courts that they would not have otherwise, usually because of the limited amount at

191. Id. at 242.

192. See id. at 248–52. Judge Weinstein makes the related point that “consolidation may be necessary as a

resource-pooling device to initiate and fund scientific research needed to determine liability.” Jack B. Weinstein,

Some Benefits and Risks of Privatization of Justice Through ADR, 11 Ohio St. J. on Disp. Resol. 241, 268 (1996)

[hereinafter Weinstein, Privatization of Justice].

193. Rosenberg, Individual Justice, supra note 73, at 256–57.

194. Id. at 257.
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stake.195 Similarly, there can be no dispute about the value of collectivization when cost

savings make all claimants better off than they would have been in separate litigation or

when a defendant’s limited assets must be identified, preserved, and rationed among claims

that exceed those assets.196 The frequency with which collectivization’s cost savings make

all claimants better off, even those with injuries likely to result in high jury verdicts, seems

an open question.

Rosenberg’s proposal focuses on a subset of mass torts, those in which there has been

exposure to a hazardous product or condition that creates a risk of future, latent injuries.

Such a mass exposure case may or may not be classified as an immature mass tort, depending on the minimum latency period and the timing of the litigation. If injuries have

occurred and claims have been presented, collective treatment would be directed primarily at future claims, with prior cases having established values from which to determine

the collective future claims. If the tort is immature, however, practical difficulties of estimating damages and apportioning risks have to be addressed.

Elsewhere, Rosenberg argues for applying the collective justice model to all mass torts,

without invoking what he sees as a slippery and indeterminate standard of maturity.197

Attempting to apply a maturity threshold hinders the operation of deterrence in cases

that may not warrant the investment necessary to surpass that threshold.198 On the positive side, using collective approaches at the outset allows for a fair test of the merits, one

in which each side has incentives to invest the resources needed to uncover and present its

best evidence on the merits.199

195. See id. at 237. Rosenberg’s assumption seems to be that class members in such cases do not have an

expectation of individual participation and control beyond the right to object to a settlement or opt out of a

class.

196. Id.

197. David Rosenberg, Comment: Of End Games and Openings in Mass Tort Cases: Lessons from a Special

Master, 69 B.U. L. Rev. 695, 707–09 (1989).

198. See id. at 710. See supra notes 128–35 for a discussion of maturity.

199. See id. at 708–10. Another commentator has advanced a proposal similar to Rosenberg’s. This proposal would allow tort law recovery for the increased risk of contracting a harmful disease, allowing the

plaintiff to enter the judicial system upon wrongful exposure to a harmful product rather than after the onset

of the disease. Parent’s theory is that all who have been put at risk against their will deserve to be compensated. Steven J. Parent, Comment: Judicial Creativity in Dealing with Mass Torts in Bankruptcy, 13 Geo. Mason

U. L. Rev. 381, 407–08 (1990). Similar proposals for altering causation rules are discussed infra notes 541–

554.
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ii. Statistical sampling in mature mass torts

Another aggregation approach has been applied to mature mass torts. Based on Judge

Robert Parker’s handling of the Cimino asbestos litigation, Professors Michael Saks and

Peter Blanck present a model for aggregation as an integral component of mass torts

trials, focusing on the assessment of damages. As noted above, this model was implicitly

endorsed by the Ad Hoc Committee on Asbestos Litigation.200 In Cimino, Judge Parker

certified a class of 3,031 plaintiffs, all of whom had pending asbestos claims in the Eastern

District of Texas. Settlements and dismissals reduced the class to 2,298 claims.201 Five

defendants that manufactured asbestos products remained in the case at the time of trial.

Judge Parker conducted trials of these cases in three phases. In Phase I, a jury resolved

all the issues that were common to the plaintiffs in the litigation, using procedures that

Judge Parker had created and applied—and, most importantly, the court of appeals had

approved—in Jenkins v. Raymark.202 The issues were whether the asbestos products were

defective and unreasonably dangerous, whether the warnings were adequate, and whether

the state of the art or fiber type defenses were viable.203 The jury also considered the issue

of punitive damages and returned its Phase 1 verdict after about seven weeks of trial.204 In

addition to finding defective products, the jury found all five defendants to be grossly

negligent and, in response to a special interrogatory, found punitive damages multipliers

ranging, for the five defendants, from $1.50 to $3.00 for each $1.00 of actual damages.

Phase II was designed for another jury to establish levels of exposure for various

worksites and crafts for defendants, including those defendants who settled, and to apportion percentages of causation among the defendants. As it turned out, defendants

stipulated to findings on all of the issues in Phase II.205

Phase III dealt with damages. The court divided the cases into five disease categories

based on plaintiffs’ injury claims and selected a random sample of cases from each disease category. The categories, total numbers, and sample sizes (in parentheses) were:

mesothelioma-32 (15); lung cancer-186 (25); other cancer-58 (20); asbestosis 1,050 (50),

and pleural disease-972 (50).206 Two new juries were impaneled and they sat together for

five days to hear general medical testimony. They then sat separately and heard testimony,

group-by-group, on cases from each of the five injury groups and returned separate dam200. Supra notes 88-89.

201. Cimino, 751 F. Supp. at 652–53.

202. 782 F.2d 468 (5th Cir. 1986).

203. Cimino, 751 F. Supp. at 653.

204. See id.

205. See id. at 653-54.

206. See id.
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age verdicts for all the cases from each group over a period of approximately three

months.207 The juries considered the groups in descending order of severity, starting with

the mesothelioma cases.208 Judge Parker reviewed the verdicts and ordered remittiturs in

thirty-four pulmonary and pleural cases and in one mesothelioma case.209 According to

Professor Mullenix, in a case study of Cimino, Judge Parker “used almost every known

technique for aiding jury comprehension, including extensive pretrial and posttrial jury

instructions, jury notebooks, notetaking, interim summations, and witness photographs

to refresh the jury’s memory.”210

Based on statistical evidence presented at a post-trial hearing, Judge Parker found that

the sample cases were in fact representative of the total population on all relevant variables.211 Defendants did not challenge the statistical evidence. After calculating the

remittiturs and including cases with zero verdicts, the court applied the average damage

awards within each disease category to the remaining cases within that category. Plaintiffs

waived any rights to individual damage determinations.212 Defendants objected on due

process grounds. The court rejected those challenges, saying that “unless this plan or some

other procedure that permits damages to be adjudicated in the aggregate is approved,

these cases cannot be tried.”213

Defendants appealed. The appeal was filed on May 3, 1993, and on August 17, 1998, a

panel of the court of appeals unanimously held that the sampling procedures violated the

Seventh Amendment and also failed to apply Texas law as required by Rules of Decision

Act, 28 U.S.C. § 1652. The court squarely held that “the findings of the actual damages for

each of the individual Phase III plaintiffs cannot control the determination of, or afford

any basis for denial of, Pittsburgh-Corning’s Seventh Amendment rights to have a jury

determine the distinct and separable issues of the actual damages of each of the extrapolation plaintiffs.”214 Although the court did not directly address defendant’s due process

rights, the court seemed to find a due process violation as well.215

207. See id.

208. See Kenneth A. Bordens & Irwin A. Horowitz, The Limits of Sampling and Consolidation in Mass Tort

Trials: Justice Improved or Justice Altered?, 22 Law & Psychol. Rev. 43, 45–46 (1998).

209. Cimino, 751 F. Supp. at 657.

210. Linda S. Mullenix, Beyond Consolidation: Postaggregative Procedure in Asbestos Mass Tort Litigation,

32 Wm. & Mary L. Rev. 475, 572 (1991).

211. See Cimino, 751 F. Supp. at 664.

212. See id. at 653.

213. Id. at 666.

214. Cimino, 151 F.3d at 320–21.

215. See id. at 311 (“Although we do not separately address the due process contention as such, we conclude that the Cimino trial plan is invalid in these respects . . . .”).
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Long before the court of appeals reversed Judge Parker’s trial plan, two commentators, representing plaintiffs in a nationwide class action of asbestos litigants, proposed

using the Cimino approach on a national level. After common issues trials established

liability, and a representative number of damage cases were tried in each federal district,

the results would be extrapolated to other cases on a district-by-district basis.216

Judge Parker’s approach in Cimino has been used as part of a trial plan on at least two

occasions. In a set of consolidated cases filed in the 8th Judicial District Court for Clark

County, Nevada dealing with approximately 17,000 property damage subrogation lawsuits arising from a chemical explosion, counsel for one of six defendants proposed a trial

plan using stratified sampling of the insurance claims at issue. Because the cases settled

before trial the plan was not used.217

In In re Chevron USA,218 the district judge faced claims filed by 3,000 plaintiffs and

intervenors relating to personal injuries, wrongful death, and property contamination

allegedly caused by defendant’s knowing sale of contaminated land for residential development. The district court approved a trial plan that proposed a bellwether trial of

thirty claims, fifteen selected by plaintiffs and fifteen selected by defendants “to establish

bellwether verdicts to which the remaining claims could be matched for settlement purposes.”219 The court rejected defendant’s proposed plan of taking a stratified sample of

the claims and defendants filed a petition for a writ of mandamus, arguing that the plan

to use unrepresentative bellwether plaintiffs was an unfair method of determining its

liability in a unitary trial.

The Court of Appeals granted the writ in part and denied it in part. Circuit Judge

Robert Parker, now sitting as a member of the Fifth Circuit, wrote the opinion for the

court. The court of appeals barred the district court from applying the results from the

bellwether trials to the remaining 2,970 cases. The court also ruled that the district court

had discretion to proceed with the 30 cases to produce individual judgments. In reaching

that result, the court stated that “the results that would be obtained from a trial of these

thirty (30) cases lack the requisite level of representativeness so that the results could

216. See Arthur R. Miller & Price Ainsworth, Resolving the Asbestos Personal-Injury Litigation Crisis, 10

Rev. Litig. 419, 446–47 (1991).

217. Howard Ross Cabot & Alan A. Matheson Jr., The Use of Statistics to Wrest Control Over the Trial of

Mass Damage Claims, 7 Inside Litig. (Mar. 1993) at 16.

218. 109 F.3d 1016 (5th Cir. 1997). For a thorough discussion of the context and arguments in that case,

written by an attorney for the defendant, see Richard O. Faulk et al., Building a Better Mousetrap? A New

Approach to Trying Mass Tort Cases, 29 Tex. Tech L. Rev. 779 (1998).

219. Chevron, 109 F.3d at 1017.
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permit a court to draw sufficiently reliable inferences about the whole that could, in turn,

form the basis for a judgment affecting cases other than the selected thirty.”220

 Judge Edith Jones concurred in Chevron on “the narrow basis that the court’s adoption of nonbellwether methods for conducting a bellwether trial is uniquely harmful and

unauthorized.”221 She expressly declined to endorse the use of statistical sampling, asserting that “the technique may deprive nonparties of their Seventh Amendment jury trial

right.”222

Statistical sampling was also used in the case of Hilao v. Estate of Marcos,

223 a class

action composed of individuals with claims against the former president of the Philippines for damages resulting from official torture, summary execution, and disappearance. This is a unique mass tort, one that might be considered both immature and somewhat elastic, but contained in time and place, with cases identifiable enough to be aggregated. More than 10,000 claims were submitted.

A random sample of 137 claims was selected and those claimants were deposed. Their

claims and depositions were reviewed by a special master who found 6 (about 4%) to be

invalid. He issued a report setting damage levels for the 131 sample claims, calculating the

average awards for torture, execution, and disappearance categories and extrapolating

those averages to the class as a whole, recommending a total award of $767,491,493. A

jury that had found liability and a punitive damages multiplier in previous trials reconvened to hear testimony from the 137 sample claimants and from a statistical expert. The

jury was instructed that it could accept, modify, or reject the special master’s award. After

five days of deliberations, the jury “generally adopted the [special] master’s recommendations, although it did not follow his recommendation in 46 instances.”224

Defendant’s appeal was limited to the method used to determine the number of invalid claims, not the method of finding total compensation. The court of appeals, in a 2-

1 ruling, held that the “unorthodox” methodology “can be justified by the extraordinarily

unusual nature of this case.”225 The court applied the Mathews v. Eldridge226 three-part

220. Id. at 1020.

221. Id. at 1023.

222. Id. But see Paul D. Rheingold, Ethical Constraints on Aggregated Settlements of Mass-Tort Cases, 31

Loy. L.A. L. Rev. 395, 401 (1998) (indicating that the Chevron plan is “unlikely to ever pass muster”). This

judgment, of course, does not apply to stipulated use of statistical sampling based on bellwether cases.

223. 103 F.3d 767 (9th Cir. 1996). For further background on the case, see Sol Schreiber & Laura D.

Weissbach, In re Estate of Ferdinand E. Marcos Human Rights Litigation: A Personal Account of the Role of the

Special Master, 31 Loy. L.A. L. Rev. 475 (1998).

224. Hilao, 103 F.3d at 784.

225. Id. at 786.

226. 424 U.S. 319 (1976).
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balancing test, examining (1) the private interests affected, (2) the risk of erroneous deprivation and the probable value of additional safeguards, and (3) the interests of the party

seeking the procedure as well as any ancillary government interests. While the court found

that statistical sampling of valid claims “obviously presents a greater risk of error in comparison to an adversarial adjudication of each claim,” it found that, on balance, the procedure did not violate due process.227 Unlike Cimino, the Hilao case did not include a Seventh Amendment challenge or an issue of state law, and the Cimino court distinguished it

on those grounds.228 Dissenting in Hilao, Judge Rymer focused on the compensatory

damage awards and argued that “even in the context of a class action, individual causation and individual damages must still be proved individually.”229

In Cimino, Judge Parker set out to create a solution to an overload of asbestos cases on

his docket. In the course of addressing that problem, he necessarily dealt with another

problem, that of variability of case outcomes arising from differences in decision making

by juries. Social scientists, lawyers, and law professors have studied the use of sampling

and extrapolation in Cimino and arrived at mixed evaluations, with assessments that suggest the limits of the techniques employed as well as ways of improving the process. While

the tone of these assessments varies, there is considerable, indeed comforting, consensus

on some basic points. The appraisals were conducted by scholars with varied backgrounds,

including law, philosophy, social psychology, and statistics. We now summarize their assessments.

Michael Saks and Peter Blanck are most optimistic in their appraisal of the potential

of the Cimino process. They conclude that “aggregation adds an important layer of process which, when done well, can produce more precise and reliable outcomes.”230 Starting

from the premise that jury verdicts in individual litigation are highly variable,231 Saks and

Blanck argue that under some conditions, sampling can reduce variation in damage awards.

“The aggregation process refines the decision by averaging out of existence the undesirable variations and bringing the systematic and legally relevant relationships into sharper

227. Hilao, 103 F.3d at 786–87.

228. Cimino, 151 F.3d at 319. The district court in Hilao rejected a Seventh Amendment claim on the

grounds that “the jury did determine the facts of the case,” that there “would be no benefit to either side in

having the entire class testify given the repetition in the claims,” and that “Rule 23 of the Federal Rule of Civil

Procedure does not mandate the presence of each member of the class.” In re Estate of Marcos, 910 F. Supp.

1460, 1468–69 (D. Haw. 1995). Apparently, the defendant did not appeal from that decision.

229. Hilao, 103 F.3d at 788.

230. Michael J. Saks & Peter David Blanck, Justice Improved: The Unrecognized Benefits of Aggregation and

Sampling in the Trial of Mass Torts, 44 Stan. L. Rev. 815 (1992).

231. This premise is supported by experimental research: see Bordens & Horowitz, supra note 208, at 59.
48

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relief.”232 They indicate, however, that the more the cases within a disease category or

other grouping “vary from each other in legally relevant ways, the more we move away

from aggregation’s accuracy-producing benefits and move toward its error-producing

harms.”233

Examining participatory values underlying due process, such as having control of the

presentation of one’s own case and the opportunity for a “day in court,” Saks and Blanck

emphasize that these values have to be compared to the reality of the current system of

deciding individual mass torts cases. They cite findings from Deborah Hensler’s study of

mass torts to the effect that

tort lawyers and their clients in mass tort cases communicate remarkably little about

their cases and that clients have little control over the course of the litigation. Even in

the absence of formal aggregative procedures, lawyers informally aggregate cases by

representing hundreds or thousands of clients and meeting with them in large groups.234

In their judgment, “[s]uch informal aggregation is dangerous because it lacks the procedural safeguards of formal aggregation.”235

Saks and Blanck suggest several ways of improving the sampling process, such as attending to changes in the mix of cases (e.g., by settlements or dismissals), that might

convert a representative sample into an unrepresentative one;236 grouping like cases together (e.g., by type or severity of injury);237 using larger samples for heterogeneous categories of cases;238 and using more juries, assigned randomly to the subgroups, for the

purpose of reducing the risk that single juries will alter their decision making in the course

of hearing a host of cases as well as the risk that a single jury may itself be an outlier.239

Kenneth Bordens and Irwin Horowitz are both social psychologists who have done

extensive experimental research on the effects of procedural differences on jury decision

232. Saks & Blanck, supra note 230, at 836.

233. Id.

234. Id. at 840 (citing Deborah Hensler, Resolving Mass Toxic Torts: Myths and Realities, 1989 U. Ill. L. Rev.

89, 92–97).

235. Id. at 840.

236. Id. at 841–42.

237. Id. at 844–45 (citing Francis E. McGovern, The Cycle of Mass Tort Litigation 15 (Yale Program in

Civil Litigation Working Paper No. 122 (1990)), for the proposition that in Jenkins v. Raymark “fewer than

ten variables . . . can explain approximately 90% of the variation among case values”).

238. Id. at 845.

239. Id. at 849.
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making.240 They examined the court’s approach in Cimino v. Raymark, using data from

the jury decisions in Cimino and comparing those data with results from their experiments. In general, Bordens and Horowitz express sympathy with the Saks and Blanck

analysis, but their bottom line appears to be that their reservations about the procedure

used in Cimino “may vitiate the force of the Saks and Blanck logic.”241

In their review of the Cimino data, Bordens and Horowitz found that one of the “other

cancer” cases presented to one of the jury groups was an “outlier,” a case in which the

injuries were considerably more severe than other “other cancer” cases (plaintiff had his

jaw removed because of the cancer and was awarded $1.5 million, substantially more

than others in the group), possibly contaminating the decision making of that jury in

relation to other members of that group and subsequent groups.242 Bordens and Horowitz

also were critical of the structure of the juries’ consideration of groups of cases, observing

that the juries started with the mesothelioma cases and proceeded from the more severe

to the less severe injury groups. Knowledge of the serious injuries experienced by some

may have influenced the juries’ judgments about the merits of the later groups.243 Finally,

Bordens and Horowitz criticized the procedure because it averaged the outcomes of the

two juries’ decisions. Such a procedure raised questions for them about the underlying

validity of the process because the two juries exhibited two different verdict patterns. One

jury generally gave higher monetary awards than the other. Bordens and Horowitz conclude that “[s]eparate juries, comprised of different individuals, cannot be expected to

produce verdict patterns uniform enough for any reasonable combination of their

awards.”244

To address these problems, Horowitz and Bordens suggest remedies quite similar to

those proposed by Saks and Blanck. For example, Bordens and Horowitz recommend

that a court “have the plaintiffs in each sample [subgroup] judged by a separate jury” and

make the groups “as homogeneous as possible” by looking at multiple variables (such as

240. In the interest of full disclosure, I should mention that I have collaborated with Professors Horowitz

and Bordens on a number of projects over the past twenty years and that the three of us are coauthors of

Irwin A. Horowitz, Thomas E. Willging & Kenneth S. Bordens, The Psychology of Law (1998).

241. Bordens & Horowitz, supra note 208, at 44.

242. Id. at 61. This concern is based on experimental findings in which Horowitz and Bordens examined

the effect a high-damages outlier’s inclusion in a consolidation had on jury awards in other consolidated

cases and found (1) that the outlier received a lower award in a consolidated trial than would have been

received in a separate trial and (2) that the presence of an outlier in a consolidated trial increased the awards

for other plaintiffs. See generally Horowitz & Bordens, supra note 40.

243. See Bordens & Horowitz, supra note 208, at 60–61.

244. Id. at 65.
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severity of injury or strength of the evidence) as opposed to simply the category of the

disease.

If the disparity in verdicts between multiple juries, as happened in Cimino, is indeed a

problem,245 a remedy seems readily available: use only one jury for each subgroup. The

problem, however, does not seem that straightforward. Variability could arise from variations in the facts of the cases in the two groups or from variability in the decision-making

styles of the different juries. If we take as a given the variability of jury verdicts that Horowitz

and Bordens have shown in the laboratory and which the Cimino experience seems to

confirm, one could argue that averaging two or more juries’ verdicts in cases from each

subgroup would reduce the variability that otherwise exists in resolving ordinary civil

litigation.

Social scientists posit other remedies for dealing with the variability of jury verdicts.

In a thorough review of the social science literature on jury variability, Professor Neil

Vidmar of Duke Law School found that several studies linked variability of verdicts to the

seriousness of the underlying injuries.246 Other studies found, however, a wide range of

jury damages verdicts within categories of injury severity, albeit not wider than lawyers’

estimates of damages.247 Vidmar suggests several approaches to dealing with variability

in assessing damages, including: (1) providing jurors with a matrix of values that would

fix damages according to the seriousness of the injury and the age of the plaintiff; (2)

giving jurors a set of scenarios with associated dollar values that would serve as nonbinding benchmarks for the jury; and (3) employing a series of flexible floors and ceilings

that vary with severity of injury and plaintiff age rather than setting a single statutory

cap.248

In reviewing the Cimino experience and the Saks and Blanck hypotheses, law professor Robert Bone combines his knowledge of philosophy and statistics. Philosophically, a

case for sampling can be made rather easily on utilitarian grounds, while it is more difficult, but not impossible, to make a case on rights-based grounds.249 Statistically, like Saks

245. Saks and Blanck did not identify the use of two juries as a problem, but this may be because they did

not have the data that were available to Bordens & Horowitz. They may have assumed that there was little or

no disparity between the two juries—or that any disparity was not relevant to their presentation.

246. Vidmar, supra note 58, at 895–96.

247. See id. at 896.

248. Id. at 881–82.

249. See Bone, supra note 88, at 595–617. He finds sampling “is especially troubling from a rights-based

perspective because of its tendency to produce biased error,” especially if sample averaging rather than regression is used. Id. at 599.

Like Horowitz & Bordens’s experimental finding described supra note 242, Bone asserts that in many

situations, “sampling virtually guarantees that at least some high damage plaintiffs will receive verdicts substantially lower than the verdicts they would receive from an individual trial.” Id. at 600.
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and Blanck and Horowitz and Bordens, Professor Bone stresses that attempting to reduce

heterogeneity of the groups or subgroups of cases is essential in seeking an acceptable

level of accuracy of outcomes. Under those rationales, he concludes that the following

conditions should be met:

• “verdicts should be calculated in the same way for all plaintiffs, including those in

the sample group;”250

• “costs should be spread equally over the entire plaintiff population;”251 and

• a regression model should be used, determining damages by looking at factors

such as age, previous health history, future lost earnings, and medical expenses.252

Analysis from a process-oriented perspective, however, is a different matter. The “strongest objections” to sampling, he asserts, “have nothing to do with outcome accuracy;”

rather, they derive from “a process-oriented view of adjudication that values participation for its own sake, not just for its impact on outcome quality.”253 Nevertheless, after a

lengthy jurisprudential analysis, he concludes that there are conditions under which sampling can be justified even though it diminishes individual rights to control litigation and

participate in decisions that determine the outcome of individual cases.

Because litigants have equal rights to participate in litigation, courts should only limit

process-oriented claims in ways that are consistent with the equality of such rights. A trial

judge should “create as large an aggregation as possible,” allow the widest ranges of participation possible, perhaps by appointing litigation committees, and distribute participation rights either by auction or by random lottery if an auction is not feasible.254

Plaintiffs’ attorneys Joseph Rice and Nancy Davis reviewed the Cimino approach, which

they called the “virtual verdict.” They noted that the Cimino approach has been hailed as

efficient and statistically accurate, yet criticized as placing limitations on the opportunity

for an individual trial and as using a small number of sample cases.255

250. Id. at 650–51. Saks & Blanck, supra note 230, at 849 make the same point, based on a different

reasoning process. (“The best protection [from error based on the order in which cases were heard] would

actually come from giving even tried cases the mean aggregate award rather than the one arrived at for it by

the jury that heard the particular case.”).

251. Bone, supra note 88, at 651.

252. See id. at 584–87, 651. This recommendation seems comparable to Saks & Blanck’s recommendation

that multivariate analysis be used to define the sample as well as to Bordens & Horowitz’s recommendation

that multivariate analysis be used. Both regression and cluster analyses are multivariate statistical analyses.

253. Id. at 617, 619.

254. See id. at 651. An auction might not be feasible, for example, because it would interfere with the

randomness of the selection of a sample of cases from which to extrapolate damages and, as a result, skew the

accuracy of the outcomes. See id.

255. Rice & Davis, supra note 151, at 134–35.
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In sum, statistical, socio-psychological, philosophical, and legal reviews of Judge Parker’s

process in Cimino converge in finding both that the procedure is problematic and that

problems can be addressed. The primary guidance from these analyses is that:

• outliers, such as cases with extraordinarily serious injuries, create problems and

should be treated specially;

• judges should seek to stratify samples into groups that are as homogenous as possible;

• multivariate analyses should be used to assist judges in both identifying the sample

group and in applying the verdicts to the rest of the cases; and

• separate juries should be used to consider each subgroup of cases.

In addition, apparently inspired by Judge Parker’s Cimino trial plan, two University of

Virginia law professors, Glen Robinson and Kenneth Abraham, propose an even widerreaching application of aggregation approaches in tort law.256 Their proposal would extend to all damage calculations in personal injury cases, not just mass torts. Their approach contemplates using statistical claim profiles to establish the value of tort claims.

Profiles, resembling schedules for workers’ compensation plans, would be built from data

obtained from previous verdicts or settlements, incorporating all legally relevant information, such as the duration and severity of an injury, plaintiff’s knowledge of a product’s

dangers, and the like.257 Their proposal is designed to address the distortions that result

from focusing on the idiosyncratic features of individual claims or on factors that should

be irrelevant, like race, gender, and economic status. It would seem to do to damage calculations what sentencing guidelines have done to criminal sentencing, shifting from an

individualized to a collective approach.

The above is not to imply that all of the commentators have been as positive as those

summarized above. A sample of the critiques of aggregation give a sense of the centrality

of the principles and values at stake. For example, Professor Martin Redish asserts that

“even a casual examination of the aggregation devices employed by courts or suggested

by commentators reveals that most of them threaten core elements of due process

theory.”258 Contrary to the above commentators, he contends that aggregative devices

256. Glen O. Robinson & Kenneth H. Abraham, Collective Justice in Tort Law, 78 Va. L. Rev. 1481 (1992);

see also Kenneth S. Abraham & Glen O. Robinson, Aggregative Valuation of Mass Tort Claim, 53 L. & Contemp.

Probs. 137 (1990); Kenneth S. Abraham, Individual Action and Collective Responsibility: The Dilemma of Mass

Tort Reform, 73 Va. L. Rev. 845 (1987).

257. See Robinson & Abraham, supra note 256, at 1490–92.

258. Martin H. Redish, Procedural Due Process And Aggregation Devices in Mass Tort Litigation, 63 Def.

Couns. J. 18–19 (1996).
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(including mass consolidation, issue consolidation, statistical sampling, and settlement

class actions) “undermine both the goals of achieving an accurate decision and of legitimizing the adjudicatory process in the eyes of the litigants.”259

In Redish’s analysis, discussing the Mathews v. Eldridge test applied in Hilao260 (and

disagreeing with its utilitarian focus), “[t]he connecting link between accuracy and due

process is the belief that the adjudicator is more likely to find the facts correctly if the

parties possessing both the strongest interest in the outcome and the greatest access to the

relevant information are provided a meaningful opportunity to present their cases to the

fact finder.”261 He also finds “non-instrumental” values to be implicated by aggregation.

Values such as the appearance of fairness, equality, predictability, transparency, rationality, participation, and revelation are all “central to the maintenance of individual dignity

or necessary to the legitimacy of the judicial process in the eyes of litigants.”262

As to statistical sampling, Professor Redish finds it “the most controversial of all aggregation devices,” and that “[r]easonable people may differ concerning on which side of

the constitutional line sampling falls.”263 At least to a certain extent, “the constitutionality

of sampling may turn on the statistical accuracy of the samples chosen as predictors of

the absent plaintiffs’ actual damages . . . an issue over which scholars have differed.”264 He

concludes, however, that incorporating statistical sampling into mass torts adjudication

may require substantive law changes, along the lines of a workers’ compensation program. Finally, sampling procedure “does deprive defendants of the opportunity to challenge the actual damage claims of each plaintiff,” undermining significant interests served

by the procedural due process guarantee.”265

Along similar lines, Professor Roger Trangsrud states the case against aggregation of

mass torts claims. Though written before the Cimino case, his arguments are certainly

relevant to the debate about statistical sampling. Trangsrud starts from the proposition

that our common-law tradition has continuously supported individual autonomy for

259. Id. at 19.

260. See discussion supra notes 225–229.

261. Redish, supra note 258, at 20.

262. Id. at 21 (citing Martin H. Redish & Lawrence C. Marshall, Adjudicatory Independence and the Values

of Procedural Due Process, 95 Yale L.J. 455, 483–91 (1986)).

263. Id. at 23 (citing and applying Mathews v. Eldridge, 424 U.S. 319 (1976), which emphasizes the risk of

erroneous deprivation of property as a major element of due process).

264. Id. at 25 (citing Saks & Blanck, supra note 230, and Bone, supra note 88).

265. Id. at 25.
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Appendix C: Mass Torts Problems & Proposals

cases involving substantial personal injury and wrongful death.266 Justifications for individual autonomy draw both from natural law values and from the “assumption that economic decisions are best made by the true owner of property.”267 Trangsrud also critiques

the rationales used to support aggregation—largely efficiencies in costs to the parties as

well as consistency of results—as being dubious in the context of mass torts. Tort law has

never held that all participants in the same accident should be treated the same. Nor are

the savings clear. Savings are calculated as if all cases would be tried, whereas generally

early trials will lead to settlement of similar cases.268

Finally, Professor Trangsrud asserts that mass trials are unfair because they impair the

ordinary function of the jury by using procedures like trifurcation and special verdict

forms.269 They also distort the attorney-client relationship, causing tension between a

lawyer’s substantial investment in the litigation and the client’s interests.270 Finally, aggregation creates incentives for improper behavior by trial judges, such as questionable rulings on the underlying claims and incentives to press the parties to settle.271

Trangsrud proposes that the “better course is to coordinate and consolidate pretrial

discovery and motions practice but then individually try the tort cases in an appropriate

venue. After a number of cases have been tried substantial incentives will operate to encourage the private settlement of many of the remaining claims.”272

In summary, statistical sampling has generated controversy in case law as well as academic writing. It pits polar values of individual and collective justice against each other.

Whether some reconciliation is possible remains to be seen. If parties find sampling to be

a viable approach to establishing settlement values, that alone would justify its careful

consideration. Whether courts can fashion forms of statistical sampling that are sufficiently intertwined with jury decision making to satisfy Seventh Amendment concerns

appears to be the central legal issue. The procedure used by the Hilao court had elements

of jury activity that differed from Cimino, but those elements of Hilao have not been

266. See Roger H. Trangsrud, Mass Trials in Mass Tort Cases: A Dissent, 1989 U. Ill. L. Rev. 69, 70–71

[hereinafter Trangsrud, Mass Trials](citing S. Yeazell, From Medieval Group Litigation to the Modern Class

Action 211 (1987)). See also Trangsrud, Joinder Alternatives, supra note 76, at 782 (“balancing of efficiency

versus fairness leads to the conclusion that the substantial damage claims of mass tort victims deserve an

uncompromised due process . . . joint discovery on common issues is desirable in most mass tort cases”).

267. Trangsrud, Mass Torts, supra note 266, at 75.

268. See id. at 78–79.

269. See id. at 80–82.

270. See id. at 82–84.

271. See id. at 85–86.

272. Id. at 69.
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reviewed by courts faced with a Seventh Amendment challenge or evaluated by commentators. Statistical sampling may be a concept in search of a means of integrating it with

traditional legal values of due process of law and trial by jury.

2. Use of court-appointed experts

Federal Rule of Evidence 706 provides a mechanism for courts to appoint experts to address issues of scientific uncertainty. Inherent judicial power also allows a judge to appoint a technical advisor to assist the judge in understanding complex technical information.273 Both powers have been used occasionally in mass torts contexts.

Extensive use of court-appointed experts and technical advisers has been made in the

breast implant litigation. Two federal judges have used court experts in two distinctly

different ways. In May 1996 in the MDL consolidated litigation, Judge Sam C. Pointer,

Jr.(N.D. Ala.), acting pursuant to Fed. R. Evid. 706, appointed a national panel of neutral

experts to provide evidence on scientific questions relating to the reliability of evidence

linking systemic diseases with silicone gel breast implants.274 The panel issued its report

on November 30, 1998, finding that there was no strong scientific evidence that silicone

gel breast implants are statistically associated with immune system or rheumatological

diseases. Now that the report has been issued, the court plans to preside over videotaped

depositions of the experts, which will be made available to all litigants. Given that a substantial amount of the breast implant litigation has been adjudicated or settled, questions

have been raised about the timeliness of the process.

Also in 1996, Judge Robert E. Jones (D. Ore.) appointed four technical advisors in

various scientific disciplines to assist him in his district’s breast implant litigation (Hall v.

Baxter Healthcare Corp.).

275 In a case-specific process that was quite distinct from Judge

Pointer’s multidistrict process, Judge Jones used the four expert-advisors to furnish him

273. See Reilly v. United States, 863 F.2d 149, 158 (1st Cir. 1988). See also Ex parte Peterson, 253 U.S. 300

(1920) (“[c]ourts have (at least in the absence of legislation to the contrary) inherent power to provide

themselves with appropriate instruments required for the performance of their duties”) Id. at 312. See, e.g.,

the Fed. R. Evid. 706 Advisory Committee Note (noting that “[t]he inherent power of a trial judge to appoint

an expert of his own choosing [was] virtually unquestioned” as the rules were adopted). See generally Joe S.

Cecil & Thomas E. Willging, Accepting Daubert’s Invitation, Defining a Role for Court-Appointed Experts in

Assessing Scientific Validity, 43 Emory L.J. 997 (1994).

274. See In re Silicone Gel Breast Implants Prod. Liab. Litig. (MDL-926) (No. CV 92-P-10000-S) (Order

No. 31E) (Oct. 31, 1996).

275. 947 F. Supp. 1387 (D. Or. 1996).
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with reports and consultations on the reliability and admissibility of complex scientific

evidence under Fed. R. Evid. 104(a) in a Daubert hearing. Based in part on the experts’

reports, Judge Jones decided to exclude plaintiff’s proffered expert testimony.276 While

some critics of the use of court experts decry the influence of the experts on judges,277 in

Hall the court was criticized for not following the experts’ reports closely enough.278

Court-appointed experts have also been used in asbestos litigation. Judge Jack Weinstein

appointed a panel of experts to assist him in estimating future claims as a central part of

his effort to restructure the original Manville Personal Injury Settlement Trust.279 The

panel estimated that 450,000 future claims could be expected between 1990 and 2049, but

their estimate was accompanied by a 50% margin of error.280

Judge Carl Rubin appointed a standing panel of experts to review asbestos cases and

give an opinion as to the presence or absence of asbestos-related disease. In approximately 80% of the cases, the experts found no asbestos disease, and in thirteen of sixteen

cases in which the expert testified, the jury agreed with the expert.281

A Federal Judicial Center study examined cases in which judges had appointed experts and identified beneficial uses and limits in the use of court-appointed experts. Judges

who used experts considered them to be helpful in extraordinary cases in which the

adversarial system, for one reason or another, failed to generate sufficient information for

the judge or jury—more often the judge—to render a reasoned decision.282 Judges have

used experts infrequently primarily out of respect for the adversarial system, but also

because of difficulties in identifying the need for an expert in a timely manner, in locating

a suitable expert, and in obtaining funding to compensate the expert.

Just as Rubin and Ringenbach found a strong relationship between the court-appointed

experts’ conclusions and jury verdicts, the FJC study concluded that “judges and juries

276. Id. Judge Jones deferred the effective date of his decision “pending the reports of the national Rule

706 Panel” in the MDL litigation. Id. at 1415.

277. See discussion infra notes 278–280.

278. See Joseph Sanders & D.H. Kaye, Expert Advice on Silicone Implants: Hall v. Baxter Healthcare Corp.,

37 Jurimetrics J. 113, 120–23 (1997).

279. See In re Joint E. & S. Dist. Asbestos Litig. 151 F.R.D. 540 (S.D.N.Y. 1993).

280. See Coffee, supra note 69, at 1361 n.59. Several years after the expert panel’s report, Judge Weinstein

estimated that between 300,000 and 600,000 claims could be expected by the year 2050. See Weinstein, Ethical

Dilemmas, supra note 30, at 510 n.164.

281. See Carl B. Rubin & Laura Ringenbach, The Use of Court Experts in Asbestos Litigation, 137 F.R.D. 35

(1991). In their words: “The conclusion is inescapable: A Court’s expert will be a persuasive witness and will

have a significant effect upon a jury.” Id. at 41.

282. Cecil & Willging, supra note 273, at 1069–70.
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alike tend to decide cases consistent with the advice and testimony of court-appointed

experts.”283 Given that a major reason for appointing experts is the absence of a clear

basis for decision, it was not surprising that decision makers relied on the appointed

experts to supply such a rationale.284

The FJC report outlines a pretrial procedure that judges may find helpful in addressing scientific issues in mass torts litigation. The suggested procedure, which will not necessarily lead to appointment of an expert, focuses on (1) early identification of issues

likely to require expert testimony, (2) specification of disputed issues of science and technology, and (3) screening expected testimony by parties’ experts to determine admissibility.285 In this post-Daubert era, those recommendations now seem commonplace.

Two programs—one established by the American Academy for the Advancement of

Science (AAAS) and the other by the Private Adjudication Center (PAC) at Duke Law

School—have as their goals identifying candidates for appointment as experts. The AAAS

program will concentrate on matching experts with a judge’s needs in a given case while

the PAC will focus on creating a roster of suitable experts for use in any number of cases.

These programs address a major issue identified in the FJC report, the difficulty for a

judge to identify neutral experts.

3. State-federal cooperation

Most mass torts claims are based on state law; state and federal courts have concurrent

jurisdiction. The well-known result of sharing jurisdiction is that many mass torts lead to

filings in both federal and state courts. In the next section, we review proposals to address

the problem of multiple state-federal forums by expanding federal jurisdiction, creating

federal substantive law for mass torts, or adding new opportunities to aggregate cases in

the federal courts.286 In this section we look first at innovative ways in which courts have

dealt with cases filed in both federal and state courts, and then look at a closely related

legislative proposal to alter the structure of federal-state relationships in mass torts cases.

283. See id. at 1041.

284. See id. at 1044–45.

285. See id. at 1058–65.

286. See discussion infra sections II.B.1 through II.B.7 (comprehensive proposals) and II.B.9.a (“Federal

substantive law”).
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a. Voluntary innovations

Judge Schwarzer and co-authors from the Federal Judicial Center documented a host

of innovative state-federal cooperative practices, most in the mass torts area.287 Statefederal cooperation has occurred in

• discovery, in the form of joint scheduling, planning, using special master in common, using common discovery output, ruling jointly on disputes, and creating

joint document depositories;288

• settlement, in the form of joint alternative dispute resolution (discussed more

fully in the next subsection), joint settlement conferences, delegation of power to

one judge or settlement master to supervise settlement discussion, and coordination of settlement approaches;289

• pretrial management, by establishing joint pretrial orders or joint management

plans, conducting joint pretrial hearings, and resolving conflicts between federal

and state procedural rules;290 and

• joint trial planning.291

In general, the state and federal judges who coordinated their activities found the

experience to have promoted “economy, efficiency, and consistency.”292 Conditions for

effective coordination include appropriate, usually early, timing of the initial contact,

often by the federal judge; maintaining continuous contact throughout the pretrial process; establishing a personal working relationship with the other judges; and enlisting the

aid of the attorneys in identifying related cases and cooperating with each other.293 Judges

found some settings more conducive to effective coordination than others: where the

courts are in close physical proximity, have aggregated their cases within each system, and

have created a supportive judicial and legal community.294

287. William W Schwarzer et al., Judicial Federalism in Action: Coordination of Litigation in State and

Federal Courts, 78 Va. L. Rev. 1689 (1992) [hereinafter Schwarzer, Federalism in Action].

288. See id. at 1707–14.

289. See id. at 1714–21.

290. See id. at 1721–26.

291. See id. at 1727–32. While no joint trials were held in the cases studied, one judge who planned to

have a joint trial said that “I’m sure if we had had the trial, we wouldn’t have had any problems.” Id. at 1728.

292. Id. at 1732.

293. See id. at 1733–40.

294. See id. at 1740–42.
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In a cooperative effort at the national level, the Federal Judicial Center, the National

Center for State Courts, and the State Justice Institute have published a manual to guide

state and federal judges in their relations with each other in a variety of cases.295 The

manual discusses the issues described above in our summary of the FJC case studies296

and includes sample pretrial case-management orders and a sample order for a joint trial.297

The state-federal manual also includes a brief history of the Mass Tort Litigation Committee [MTLC], a standing committee of the Conference of Chief Justices.298 MTLC,

funded at one time by the State Justice Institute, brought together a dozen or more state

judges to discuss and coordinate mass torts cases in their respective jurisdictions. Generally, one or more federal judge would attend as liaison. Judge Sandra Mazer Moss, MTLC

chair, has documented a number of cooperative activities undertaken in the asbestos,

breast implant, orthopedic bone screw, Norplant, and L-Tryptophan litigations.299MTLC’s

funding expired in March 1998, and the group now has no funding for face-to-face meetings.

b. State-federal legislative proposal

Judge Schwarzer formulated a proposal to empower federal judges to consolidate state

and federal discovery as part of the multidistrict litigation process. His proposal adds

these elements to the MDL procedures: (1) limited removal of related state court cases in

which there is at least minimal diversity of citizenship (i.e., between two parties); (2)

retaining merits decisions, including choice-of-law, in the state courts for state cases; (3)

making the results of the coordinated discovery process binding in all subsequent proceedings; and (4) remanding the case to state court when it is ready for trial or summary

judgment.300 In Judge Schwarzer’s words, “The purpose of the instant proposal is to pro295. James G. Apple et al., Manual for Cooperation Between State and Federal Courts (Federal Judicial

Center 1997).

296. Id. at 15–30.

297. Id. at 119–49.

298. Id. at 31–34.

299. Sandra Mazer Moss, Response to Judicial Federalism: A Proposal to Amend the Multidistrict Litigation Statute from a State Judge’s Perspective, 73 Tex. L. Rev. 1573, 1573–76 (1995). For a discussion of the

advantages and disadvantages of state–federal judicial cooperation, see generally Francis E. McGovern, Rethinking Cooperation Among Judges in Mass Tort Litigation, 44 UCLA L. Rev. 1851 (1997); Mark C. Weber,

Complex Litigation and the State Courts: Constitutional and Practical Advantages of the State Forum Over the

Federal Forum in Mass Tort Cases, 21 Hastings Const. L.Q. 215 (1994).

300. William W Schwarzer et al., Judicial Federalism: A Proposal To Amend the Multidistrict Litigation

Statute To Permit Discovery Coordination of Large-Scale Litigation Pending in State and Federal Courts, 73 Tex.

L. Rev. 1529, 1533 (1995).
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vide a procedure for coordination of discovery in cases dispersed in state and federal

courts without implicating substantive law choices or delaying trials in state court.”301

Judge Pointer raises concerns about whether the proposal will be as innocuous a first

step as its proponents claim and whether “the benefits achieved through such legislation

justify the risk that it might divert and dissipate support for more effective solutions to

the problems of large-scale multiforum litigation.”302 Judge Pointer also expressed concern that the operation of the proposal would deprive federal courts of valuable resources

that state judges have provided under a voluntary system.303

4. Alternative dispute resolution

a. Background

In this discussion, we use the term alternative dispute resolution [ADR] to refer to

activities and programs that afford litigants alternatives to traditional dispute resolution,

such as trials or judge-hosted settlement conferences. Common examples of ADR include arbitration, mediation, early neutral evaluation, and summary jury trials, but the

list is limited only by the imagination of ADR sponsors. Some would define ADR narrowly to include only those programs that “compared with the traditional litigation process of adversarial negotiation and trial, enhance parties’ control over litigation outcomes

or processes.”304 Others define ADR to include judicial settlement efforts.305 We use our

definition—which excludes traditional judge-hosted settlement conferences and does not

require that the alternative enhance litigant control—for clarity, not to resolve the differences noted above.

A key feature of mass torts is that they have a “high degree of commonality,” which

means that “the outcome of any one case within the litigation . . . highly [influences] the

outcome of other cases.”306 Determining the value of individual cases—whether by trial

or alternative means—opens the door to resolving large numbers of other cases. For that

reason, ADR has found an integral place in federal courts’ management of mass torts

litigation, often as a means of applying known values to the mass of the litigation. In

301. Id. at 1532.

302. Sam C. Pointer, Jr., Reflections by a Federal Judge: A Comment on Judicial Federalism: A Proposal to

Amend the Multidistrict Litigation Statute, 73 Tex. L. Rev. 1569, 1570 (1995).

303. Id. at 1571.

304. Hensler, A Glass Half Full, supra note 63, at 1619.

305. See Judith Resnik, Procedural Innovations, Sloshing Over: A Comment on Deborah Hensler, A Glass

Half Full, a Glass Half Empty: The Use of Alternative Dispute Resolution in Mass Personal Injury Litigation,

73 Tex. L. Rev. 1627, 1627–29 (1995).

306. Hensler, A Glass Half Full, supra note 63, at 1596.
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some jurisdictions, ADR has also been used to determine case values in the first instance.

This seem especially apt when a mass tort arises from a single incident.

Early ADR mass torts efforts concentrated on gathering information to support evaluation of individual asbestos cases. For example, in 1982 Judge Thomas Lambros appointed

Professors Francis McGovern and Eric Green as special masters to help address a backlog

of asbestos litigation in the Northern District of Ohio. McGovern and Green devised a

plan to streamline discovery to yield settlement-related information, and they devised a

computer model containing hundreds of variables that could be used to compare the

values of settled and pending cases.307 Called the Ohio Asbestos Litigation (OAL), this

system pioneered a method for identifying variables that could be used to evaluate mass

torts cases. After extracting a range of individual case values from a computer, the parties

and lawyers participated in a settlement conferences. Using computer-generated data for

similar cases, lawyers would argue briefly, in the presence of the plaintiff, about the similarities and differences between the previous settlements and the plaintiff ’s case. Plaintiffs were reported to have been satisfied that the settlement conference provided them a

“day in court.”308 In an environment in which trials were increasingly unlikely, alternatives to trials became the most that litigants could expect.

As asbestos caseloads grew, ADR programs expanded to meet the demand for alternative approaches that could be applied more globally in mass aggregations, bankruptcy

reorganizations, and even so-called global settlements. For example, McGovern organized a database to support jury decision making in a class action trial.309 McGovern and

other ADR professionals devised plans for administering claims resolution facilities.310

With the consent of the parties, Judge Parker created an arbitration-based ADR program

307. See Francis E. McGovern, Toward a Functional Approach for Managing Complex Litigation, 53 U. Chi.

L. Rev. 440, 478–91 (1986) (describing the Ohio Asbestos Litigation).

308. See Trends, supra note 49, at 67.

309. See Jenkins v. Raymark, 782 F.2d 468 (5th Cir. 1986). In Jenkins, the court used aggregate computerbased data about class claims to aid the jury in deciding a ratio of punitive damages to compensatory damages. Trends, supra note 49, at 63 n.148.

310. See generally, Francis E. McGovern (ed.), Symposium, Claims Resolution Facilities and the Mass Settlement of Mass Torts, 53 Law & Contemp. Probs. 1 (1990); Francis E. McGovern, The Alabama DDT Settlement

Fund, 53 Law & Contemp. Probs. 61 (1990) [hereinafter McGovern, DDT Settlement ]; Kenneth R. Feinberg,

The Dalkon Shield Claims Trust, 53 Law & Contemp. Probs. 79 (1990). For more recent descriptions of the

operation of the Dalkon Shield Claimants Trust, discussed infra at notes 334 to 346, see Georgene M. Vairo,

Georgine, the Dalkon Shield Claimants Trust, and the Rhetoric of Mass Tort Claims Resolution, 31 Loy. L.A. L.

Rev. 79, 153–56 (1997) [hereinafter Vairo, Georgine]; Georgene M. Vairo, The Dalkon Shield Claimants Trust:

Paradigm Lost (Or Found)?, 61 Fordham L. Rev. 617 (1992) [hereinafter Vairo, The Dalkon Shield].
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to handle the backlog of case remaining in the Eastern District of Texas after a class action

trial in Jenkins v. Raymark.311 Judge Lambros and others adapted summary jury trials to a

mass torts context.312 In the L’Ambiance Plaza building collapse, a federal and state judge

jointly interviewed witnesses and plaintiffs, evaluated each case, and recommended settlement amounts that came to be incorporated in a global settlement.313 Before L’Ambiance,

Judge Louis Bechtle in the MGM Grand Hotel fire litigation had established the foundation for a global settlement by meeting individually with plaintiffs to assess the value of

their cases.314 ADR was clearly an integral part of the creative response of federal and

state judges to the flood of mass torts litigation that suddenly appeared on their dockets.

b. Proposals and critiques

A number of proposals are directed at managing the volume of cases involved in mass

torts litigation. Other proposals focus on enhancing the quality of mass torts dispute

resolution, and, not surprisingly, a number of proposals address both aspects of ADR. We

concentrate on ADR approaches to resolving individual claims. We do not discuss other

possible applications of ADR techniques, which extend to the full range of litigation management, including pre-litigation mediation, insurance coverage disputes, alternative approaches to discovery and science issues, appointment of special masters, and other alternative judicial case-management techniques.315

Deborah Hensler challenges policy makers to “shape aggregative procedures to enhance litigant control and participation within the bounds of what is financially and

logistically possible.”316 She suggests appointing plaintiffs’ panels to represent diverse interests, including future claimants, in a given litigation. Such panels would monitor the

311. See Linda S. Mullenix, Beyond Consolidation: Postaggregative Procedure in Asbestos Mass Tort Litigation, 32 Wm. & Mary L. Rev. 475, 490–92 (1991) (describing ADR program); see also Trends, supra note 49, at

79–81.

312. See Trends, supra note 49, at 76–79 (reviewing summary jury trials in asbestos litigation and discussing concerns about unpredictability and efficiency).

313. See Schwarzer et al, Federalism in Action, supra note 287, at 1715–18.

314. See id. at 1719–20.

315. See generally Feature, ADR Recommendations for Mass Torts, 52 Disp. Resol. J. 78 (1997) (reporting

twelve recommendations of an American Arbitration Association task force chaired by Kenneth Feinberg);

see also Kenneth R. Feinberg, Response to Deborah Hensler, A Glass Half Full, a Glass Half Empty: The Use of

Alternative Dispute Resolution in Mass Personal Injury Litigation, 73 Tex. L. Rev. 1647 (1995) (“What I do is

not really ADR. It is CJM—creative judicial management . . . .”).

316. Hensler, A Glass Half Full, supra note 63, at 1624.
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litigation and negotiation process, “offer suggestions, and report back to the plaintiffs

whom they represent.”317 Hensler suggests that courts “could also use electronic bulletin

boards and similar technologies to provide up-to-date information on the progress of a

settlement negotiation.”318 These suggestions would provide a way to begin to address

the question of what claimants want from the civil justice system, particularly “how claimants would assess the justice of alternative compensation schemes . . . [or] what they

might be willing to give up in order to provide more equitable compensation to others

who share their injuries and experiences.”319

Social psychologist Tom Tyler echoes Hensler’s premise that mass torts claimants want

to have procedures that call for their participation and give them an element of control

over the type of procedure that will be used to resolve their case.320 He finds that the

design of mass torts claims resolution facilities “has not been based on an understanding

of what claimants want from legal procedures” and concludes that “[m]ore careful attention to existing psychological research on claimants’ reactions to legal procedures could

lead to substantial gains in both satisfaction with the disposition of mass torts cases and

the acceptance of decisions resolving mass torts claims.”321

Attorneys Barry McNeil and Beth Fancsali have found that “valuation of claims is

perhaps particularly suitable for mediation and arbitration” because “a facilitator can

commit time and attention to reviewing considerable data and understanding the basis

of each claim, in a manner and on a schedule simply unavailable to the court.”322 They

caution, however, that “the process should not be allowed to get ahead of itself” by being

used before there is a “history of jury verdicts yielding a range of outcomes.”323

McNeil and Facsali’s caution has broad support and may represent a consensus on the

use of ADR, at least for immature, elastic mass torts. John McGoldrick, an attorney, argues that “ADR can make a mass tort out of no tort” and that it can play a role in “creating, sometimes just stirring, but even creating the feeding frenzy that is often the begin317. Id.

318. Id. at 1624. Some forms of group communication have been employed in the Agent Orange and

breast implant litigations. Id. at 1625.

319. Id. at 1626.

320. See Tom R. Tyler, A Psychological Perspective on the Settlement of Mass Tort Claims, 53 Law & Contemp.

Probs. 199, 200–04 (1990) (citing empirical studies of litigant satisfaction in general civil litigation and a

comparative study of asbestos victims in England and the United States).

321. Id. at 204–05.

322. McNeil & Fancsali, supra note 7, at 506.

323. Id.
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ning of mass tort.”324 Such comments lead commentators to conclude that ADR has its

best application as a means of resolving the tail of mature mass torts litigation.

Another ADR model—called into question because of experiences with elasticity of

some mass torts325—concentrates on class-wide litigation of common issues, such as liability and product defect, followed by ADR approaches to individual issues, such as specific causation and damages. Professor Carrie Menkel-Meadow recommends using “fasttrack ADR procedures” like those used in the Dalkon Shield settlement trust to provide

an opportunity for mass torts claimants to have individual hearings that are less than

full-scale adjudications.326 She would offer litigants a choice of such a hearing, on the

rationale that “some claimants will want personal contact with some third party” and

that other claimants “will simply want their money.”327

Similarly, Judge Weinstein sees a place for ADR in resolving the “residual disputes”

that remain after an aggregated settlement, such as allocating shares of responsibility among

defendants or arbitrating individual damage claims against a settlement fund.328 And

Professor John Coffee calls for “combining the class action with arbitration (and/or other

alternative dispute resolution techniques) on the limited issues of damages and individual

causation.”329 He concludes that even though this approach would leave the final price

tag for damages open-ended, the cost savings would give defendants a “substantial incentive” to accept such a process.330

As noted above, some commentators urge caution in using aggregation prematurely

to achieve a comprehensive settlement.331 McGovern, for example, advocates “letting the

marketplace of litigation play out in the early stages and using more comprehensive casemanagement techniques as the mass tort matures.”332 Whatever the mechanism for resolving the common issues, both sides of this debate concur that ADR is appropriate in

addressing individual issues at the tail of the litigation.

324. Kenneth R. Feinberg (Moderator), Debate: The Role of ADR in Mass Torts, 53 Disp. Resol. J. 19, 21

(1998).

325. See generally McGovern, Mass Torts for Judges, supra note 15.

326. See Menkel-Meadow, supra note 184, at 1204–05.

327. Id. at 1216.

328. Jack B. Weinstein, Privatization of Justice, supra note 192, at 288.

329. Coffee, supra note 69, at 1439.

330. Id. at 1441.

331. See McGovern, Mass Torts for Judges, supra note 15, at 1841–45 (discussing stages in maturation

process); McNeil & Fancsali, supra note 7, at 506 (call for a history of jury verdicts before using ADR).

332. McGovern, Mass Torts for Judges, supra note 15, at 1844.
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In fact, ADR has been used extensively in building claims facilities to process mass

torts claims, especially in the context of a bankruptcy or a class action settlement.333 An

experienced consultant, B. Thomas Florence, Ph.D., has identified a set of standards that

have emerged from establishing and operating a host of claims facilities. He summarizes

these standards under the heading of affording equality of treatment, developing confidence among constituents, promoting settlement over litigation, and enhancing efficiency

of operations.334 We discuss the first three standards.

“Equality of treatment among claimants is the cornerstone of success in any mass tort

facility,” says Florence.335 He notes that methods of achieving equality “are contrary to the

methods employed in normal tort settlement” in which “adversarial relationships . . .

position each side to obtain the most favorable outcome in a single case.”336 In the claims

facility, the goal is to develop procedures “to guarantee that a claim receives the same

settlement offer regardless of when the claim is filed, who receives it, or when it is reviewed.” Professor Georgene Vairo, Chairperson of the Dalkon Shield Trust Fund, documented efforts to implement equality of treatment, noting its corollaries that claimants

without lawyers would be assisted in filing claims, that lawyers’ claims would be treated

the same as those of unrepresented claimants, and that there would be no negotiation of

the trust’s best final offer.337

Critics have charged that the approach leaves little room for meaningful participation

by claimants because the arbitration offered had a relatively low cap and “the procedure

may offer the mere appearance of ADR without much substantive reward.”338 That view,

as noted above, is based on a definition of ADR that contemplates an increase in client

control.339 Goals of equal treatment and consistency of outcomes, however, appear to be

in conflict with client control in this instance. One wonders whether claimants in a mass

torts setting expect to be treated individually and whether participation by representatives (e.g., consumer groups and attorneys) and neutrals (judges and special masters) in

establishing a fair system would satisfy expectations for procedural justice. The bottom

line is that there is no empirical research on these points.

333. See generally McGovern, DDT Settlement, supra note 310.

334. B. Thomas Florence, Mass Tort Claims Processing Facilities: Keys to Success, 31 Loy. L.A. L. Rev. 503

(1998); see also Vairo, supra note 310, at 130–31 (stating similar principles of fairness, efficiency, and settlement).

335. Florence, supra note 334, at 505.

336. Id.

337. Vairo, supra note 310, at 130–32.

338. Hensler, A Glass Half Full, supra note 63, at 1622.

339. See discussion supra, at notes 304–05.
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Dr. Florence’s second standard is that the facility develop confidence among claimants

and other constituents that settlements are fair and equitable. In addition to the equal

treatment goal, this requires “frequent and open communication with claimants and counsel, and . . . user friendliness.”340 Meeting this goal entails regular newsletters, correspondence with claimant and counsel, telephone banks with staff who can give prompt answers, and procedures that simplify the claims process.341 Again, we do not know at this

time whether such communications satisfy claimants’ desires for procedural justice, but

evaluation of the Dalkon Shield trust might generate useful information.

As to the third standard, according to Florence “[v]irtually all facilities are designed to

promote settlement over litigation.”342 Devices to accomplish that goal include “court

orders channeling all claims to the claims facility; alternative dispute resolution mechanisms which the claimant must utilize prior to filings for litigation; and disincentives to

litigate, such as award caps, elimination of punitive damages, court certification prior to

entering a complaint in the tort system, and staggered payment of litigation awards.”343

Whether these devices are successful in achieving the stated goal of promoting settlement

needs to be evaluated empirically.

In describing the Dalkon Shield Claimants Trust, Professor Vairo underscores the importance and difficulty in arriving at an accurate estimation of the amount and value of

the claims to be expected.344 After a notice process generated about 200,000 timely active

claims, court appointed experts “sent a detailed questionnaire to a scientific sample of

claimants”345 and used that information to extrapolate to the claimant population. The

resulting estimate created a fund that has proved to be more than sufficient to pay the

claimants at the projected levels.346

In summary, there appears to be a consensus that ADR would be most useful in resolving individual claims for damages after the liability and general causation issues have

been resolved. Architects of claims resolution facilities have articulated standards that are

designed to achieve fairness and consistency in compensating individuals for their injuries. Whether they satisfy claimants’ needs and interests in having a “day in court” remains in doubt. Claims of success in meeting these standards should be rigorously evaluated.

340. Florence, supra note 334, at 508.

341. Id. at 508-09; for a discussion of how the Dalkon Shield Claimants Fund implemented this standard,

see Vairo, The Dalkon Shield, supra note 310, at 640–41.

342. Florence, supra note 334, at 509.

343. Id.

344. Vairo, Georgine, supra note 310, at 124–26.

345. Id. at 126.

346. Id.
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Appendix C: Mass Torts Problems & Proposals

5. Bankruptcy 347

a. Introduction

The bankruptcy process has certain unique advantages in resolving mass torts liability

for a single defendant. Bankruptcy’s advantages flow from, to name a few, the nationwide

jurisdiction of the court and from a statutory structure that is designed to establish fair,

equitable, and reasonably clear priorities among competing classes of interested parties

(e.g., of creditors over equity holders; secured creditors over unsecured creditors; unsecured priority creditors over unsecured non-priority creditors) and to treat classes of

claimants equally, vis-à-vis other members of the same class (e.g., present tort claimants

and future tort claimants).

Despite these favorable features, the Bankruptcy Code obviously was not drafted with

the resolution of mass torts liability in mind. Like other aggregative procedures, including the class action, treatment of future claimants in bankruptcy cases is a distinct, but

not unsolvable, problem. In this section we will address the current treatment of future

claims in bankruptcy as well as statutory proposals to improve bankruptcy’s approach to

future claims. Examining future claims necessarily involves looking at procedures for estimating the number and value of such claims.

b. The bankruptcy process

First, we present some background on the procedures prescribed for Chapter 11 reorganization plans. The Bankruptcy Code explicitly requires that a Chapter 11 reorganization

plan identify and designate separate classes of creditors’ claims and equity holders’ interests, specify the treatment to be afforded each class of claims or interests affected by the

plan, provide equal treatment for each claim or interest within a particular class, and

avoid benefiting directors, officers, and trustees at the expense of creditors and interest

holders.348 The latter rule, known as the principle of absolute priority, assures tort claimants of having their claims satisfied before equity claimants receive any value for their

interest in the company. Another rule, known as the best interests of the creditor principle,

guarantees that a Chapter 11 plan cannot be confirmed over the objection of a single

347. Brian Lang, a third-year law student at Ohio State University Law School, provided substantial research and drafting assistance for the bankruptcy section of the report, and Chief United States Bankruptcy

Judge David S. Kennedy (W.D. Tenn.) provided insightful and invaluable comments on an earlier draft of this

section.

348. See 11 U.S.C. §§ 1123(a)(1)–(7) and 1122(a)–(b). For a discussion of the policy underlying the

absolute priority rule, see Elizabeth Warren, Business Bankruptcy 134–36 (Federal Judicial Center 1993).
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creditor (i.e., a dissenting member of a class) who would receive a better return in a

chapter 7 liquidation case than in the proposed Chapter 11 reorganization.349

The Bankruptcy Code requires the court to conduct a confirmation hearing and determine whether a plan satisfies thirteen statutory requirements, including that the plan

is feasible and that it satisfies the best interests of creditors test described above.350 Judicial review of the plan must take place even if every impaired class of claims or interests

has affirmatively accepted the plan.351

Even if an impaired class of claims or interests votes not to accept a proposed plan, the

court nevertheless may confirm the plan (cram down is the term of art) if the court finds

that the plan does not discriminate unfairly, and is fair and equitable.352 For example, a

Chapter 11 plan will be considered fair and equitable if dissenting unsecured creditors

either receive the full value of their claims, as of the effective date of the plan, or if no

claims that are junior to their own (generally equity claims) receive or retain any property.353

c. Defining future claims under current law

Defining when a “claim” arises serves as the linchpin of the bankruptcy system, especially in the mass torts arena. Unless future claims are included, they cannot, of course, be

treated equally nor can the debtor achieve final resolution of liability for such claims.

Congress clearly expressed an intent that the term “claim”354 be given “the broadest definition possible . . . [contemplating that] all legal obligations of the debtor, no matter how

remote or contingent, will be able to be dealt with in the bankruptcy case.”355

349. See 11 U.S.C. § 1129(a)(7). For a discussion of the policy underlying the best-interests test, see

Warren, supra note 348, at 139–40 (“If a Chapter 11 plan will reduce the payout to creditors then it cannot be

confirmed without the consent of those injured. The best-interest test reinforces the goal of using reorganization to enhance value, not to diminish it.”).

350. See 11 U.S.C. §§ 1128(a) and 1129; see also Warren, supra note 348, at 30.

351. See Gerald F. Munitz & Karen M. Gebbia, The Chapter 11 Plan, Confirmation and Cramdown, in

Basics of Bankruptcy and Reorganization 339, 355 (1992).

352. See 11 U.S.C. § 1129(b)(1)–(2); see also Warren, supra note 348, at 134–36.

353. See 11 U.S.C. § 1129(b)(2)(B)(i)–(ii), cited in Munitz, supra note 351, at 375.

354. 11 U.S.C. § 101(5) defines claim as a:

(A) right to payment, whether or not such right is reduced to judgment, liquidated or unliquidated,

fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured; or

(B) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment,

whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured, or unsecured.

355. H.R. Rep. No. 595, 95th Cong., 2d Sess. 309 (1997), cited in Barbara J. Houser et al., Mass Torts and

Other Future Claims, Chapter 11 Business Reorganizations 99 (1997) (brackets in original).
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Two prominent mass torts cases—Johns-Manville and A.H. Robins (Dalkon Shield)—

employed a conduct test to determine when claims arose.356 “Under the ‘conduct test,’ a

right to payment, and thus a bankruptcy ‘claim,’ arises when the debtor’s conduct giving

rise to the alleged liability occurred.”357 However, the conduct test defines “claim” so broadly

that it would be possible for individuals who have had no contact with a debtor—for

example, purchasers of a defective product that was manufactured before the bankruptcy

filing, but purchased after a reorganization plan had been confirmed—to have their rights

determined under the plan.358 When a creditor’s claims are proposed for discharge before

the creditor comes into contact with the debtor, constitutional due process concerns are

magnified. How can such future claimants be notified and heard? Can a future claims

representative adequately represent them? Some courts have formulated a prepetition relationship test to avoid such conundrums.

The prepetition relationship test requires that the “tortious conduct still must occur

prepetition, but the future claimant must also have some relationship with the debtor.”359

The classic prepetition relationship test was articulated in the Piper Aircraft case.

360 In

Piper, the debtor attempted to define claimants to include unknown—and even unborn—

persons who might, after Piper’s Chapter 11 reorganization plan was confirmed, assert a

claim relating to aircraft or parts manufactured and sold by Piper before the plan was

confirmed.361 After objection, the bankruptcy court held that the definition of future

claims was too broad. The district court affirmed, holding that a claim can arise only

when there has been some sort of pre-petition relationship between the parties—“some

way to connect the future claims to the debtor today.”362

Applying the prepetition relationship test would not have precluded recovery in asbestos or Dalkon Shield cases because even future claimants had been exposed to poten356. See Grady v. A.H. Robins Co., 839 F.2d 198 (4th Cir.), cert denied sub nom. Joynes v. A.H. Robins Co.,

487 U.S. 1260 (1988); In re Johns-Manville Corp., 36 B.R. 743 Bankr. (S.D.N.Y. 1984). See also Richard B.

Sobol, Bending The Law: The Story of the Dalkon Shield Bankruptcy 108 (1991).

357. Sobol, supra note 356, at 100.

358. See id. at 101.

359. Houser, supra note 355, at 101.

360. See In re Piper Aircraft 162 B.R. 619, 627 (Bankr. S.D. Fla.), aff’d sub nom. Epstein v. Official Committee of Unsecured Creditors of Estate of Piper Aircraft Corp., 168 B.R. 434 (S.D. Fla. 1994), aff’d, 58 F.3d 1573

(11th Cir. 1995).

361. See In re Piper Aircraft, 162 B.R. at 627 n.1.

362. Piper, 168 B.R. at 439. “The bankruptcy court provided four examples of a prepetition relationship,

namely ‘contact, exposure, impact, or privity between the debtor’s prepetition conduct and the claimant.’ ” Id.
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tially dangerous products before Chapter 11 petitions were filed. In dealing with harmful

chemical, drugs, material, or intrauterine devices, courts would presume that some injury occurred at the time of initial contact.363

After Piper there remain serious gaps and uncertainties in the Bankruptcy Code’s treatment of mass torts claims. Piper, after all, is a single case and it did not arise in a mass torts

context. Several different approaches have been recommended.

d. Defining future claims: NBRC and NBC proposals

In an attempt to resolve disputes over what constitutes a future claim, the National

Bankruptcy Review Commission (NBRC) proposed in October 1997 the following statutory definition of “mass future claim:”

[a] claim arising out of a right to payment, or equitable relief that gives rise to a right to

payment that has or has not accrued under nonbankruptcy law that is created by one or

more acts or omissions of the debtor if: (1) the act(s) or omission(s) occurred before or

at the time of the order for relief; (2) the act(s) or omission(s) may be sufficient to

establish liability when injuries are ultimately manifested; (3) at the time of the petition, the debtor has been subject to numerous demands for payment for injuries or

damages arising from such acts or omissions and is likely to be subject to substantial

future demands for payment on similar grounds; (4) the holders of such rights to payments are known or, if unknown, can be identified or described with reasonable certainty; and (5) the amount of such liability is reasonably capable of estimation.364

There has been little published commentary to date on the NBRC proposal. Judge

Edith H. Jones (5th Cir.), a member of the NBRC, published an incisive critique of the

mass torts proposals. Summaries of her comments will be interspersed throughout this

discussion.365

To illuminate the issues in defining future claims, we will examine a prior proposal

and some of the ensuing commentary. In 1994, the National Bankruptcy Conference (NBC)

proposed an amendment to the definition of “claim” in section 101(5) to “provide that

363. Piper, 168 B.R. at 438 n.5.

364. National Bankruptcy Review Commission, Final Report: Bankruptcy: The Next Twenty Years (October 20, 1997) [hereinafter NBRC Report]

365. Edith H. Jones, Rough Justice in Mass Future Claims: Should Bankruptcy Courts Direct Tort Reform?,

76 Tex. L. Rev. 1695 (1998). In addition to the commentary discussed in the text, the Business Bankruptcy

Committee of the American Bar Association has reviewed the NBRC proposals. G. Eric Brunstad, Jr. et al.,

Review of the Proposals of the National Bankruptcy Review Commission Pertaining to Business Bankruptcies:

Part One, 35 Bus. Law. 1381 (1998). In general, the committee’s comments are that the recommendations on

mass torts “constitute an improvement over the current law,” id. at 1450, and that “the essential details of the

proposals remain vague,” id at 1451 (referring to the mechanics of appointment of a future claims representative, the standards for issuing a channeling injunction, and the estimation procedures).
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the occurrence of one or more material acts or failures to act at the time of or before the

order for relief creates a claim, if the plan proponent identifies with reasonable certainty

the acts upon which the claim is based.”366 Note that the NBC proposal does not include

the NBRC requirements that there be numerous demands for payment, that future claimants be identifiable and that their claims be capable of estimation. Nor does the NBC

proposal appear to require a prepetition relationship between the claimant and the debtor.

It is also worth noting that in 1994 Congress adopted the “Manville Amendments” to

the Bankruptcy Code.367 These amendments authorized courts to issue a channeling injunction in an asbestos-related reorganization, steering all claims and “future demands”

to a trust that must meet statutory qualifications.368 Congress did not take the opportunity to define claims to include future claims, but instead used the concept of future

demands, a new statutory term that introduced new difficulties.369

Ralph Mabey and Peter Zisser are attorneys who advocate using bankruptcy extensively to deal with future claims.370 They define a “future claim” as “‘a claim against a

debtor for an injury or disease that has not yet become manifest at the time the debtor has

filed for bankruptcy, but is based upon the occurrence, prior to the bankruptcy, of one or

more material events, acts, or failures to act.’ ”371

With the above definition in mind, Mabey and Zisser compare the Manville Amendments to the proposed NBC amendments, illuminating the advantages of the NBC proposals. First, as noted above, the Manville Amendments view future claims as future “demands,” thereby denying them statutory rights, especially voting rights, that flow from

having a “claim” under the Bankruptcy Code.372 Further, a single dissenting holder of a

present claim may block the plan if recovery in liquidation would be greater than in the

Chapter 11 proposed plan under the best interests of the creditor test noted above, but the

holder of a future demand has no such right.373

366. National Bankruptcy Conference, Reforming the Bankruptcy Conference’s Code Review Project,

Final Report (1994) [hereinafter NBC].

367. Pub. L. No. 103-394, 108 Stat. 4106 (1994) (codified at various parts of 11 U.S.C.).

368. See generally Ralph R. Mabey & Peter A. Zisser, Improving Treatment of Future Claims: The Unfinished Business Left by the Manville Amendments, 69 Am. Bankr. L.J. 487, 498–99, 502–05 (1995) [hereinafter

Mabey & Zisser].

369. Id. at 502–03.

370. See generally id.

371. Id. at 477–78 (citing Mabey & Gavrin, supra note 70, at 749–50).

372. See id. at 502–03.

373. See id.
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Mabey and Zisser prefer the NBC proposed amendment because it would make clear

that future claims are statutorily recognized claims.374 Under both the NBC and the NBRC

definitions future claimants would have a right to share in the distribution of the property of the estate, the right to vote for or against the plan, and the rights to protection

under the best interests of the creditor test and the absolute priority rule.375 Further,

future claimants would be subject to due process considerations and protections, and

their claims also would be subject to discharge—thereby relieving the debtor of future

liability.376

When considering the value of the NBC proposed amendments, Mabey and Zisser

state that future claimants must be treated fairly with respect to present claimants and

that a limited funds value would be maximized by including in the plan as many future

claims (those arising from prepetition conduct although not yet manifested) as possible.

This approach limits the possibility that futures will assert claims later—so-called

“overhang[ing]” liabilities.377

Judge Jones finds the NBRC proposals a departure from precedent by “crafting a bankruptcy definition of a claim that is untethered to state law.”378 The proposal thus introduces additional uncertainty about claims. Unlike class action jurisprudence, the definition contains “[n]o requirement of commonality of legal or factual issues, typicality, or

predominance of common issues exists in this definition.”379 The only advantage over

class action approaches is that “the Commission proposal would arguably create enough

of a controversy to overcome justiciablity concerns” that have accompanied future claims

issues.380

Professor Kathryn Heidt thinks that the NBC proposed amendments do not go far

enough. Her critique would also apply to the NBRC proposal. While approving of the

bankruptcy court as a forum for resolving future claims, Heidt argues that the Bankruptcy Code should be amended “to make clear that obligations arising from culpable

374. See id. at 504–05.

375. Whether future claimants should be considered part of the present class of claimants or a separate

class remains open to debate. Traditionally, futures were treated as a separate class from present claimants

(e.g., the Manville Amendments specify that future participants possess demands but not claims). This was

not the case, however, in Robins. See id. at 496–97 (“In A.H. Robins, on the other hand, future claims were

accorded the same treatment as present claims”).

376. See id at 503–04.

377. See id.

378. Jones, supra note 365, at 1707.

379. Id. at 1708.

380. Id. at 1709.
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actions which are not yet manifested, and perhaps have not yet even occurred, are ‘claims’

that ‘arise’ at the time the debtor commits the act on which liability is based.”381 In effect,

this would codify the conduct test for determining when a claim arises.

Heidt believes that Mabey and Zisser’s definition of what constitutes a “future claim”

is unclear about whether that term would include persons who at the time of the filing

had not yet come into contact with the product (e.g., the future claimants in Piper who

had no pre-bankruptcy relationship with the debtor or its product).382 Heidt argues that

if these persons are not included then both principles of fairness and maximizing a fund

for claimants by eliminating future demands on the debtor outside the fund—principles

upon which Mabey and Zisser rely—will be violated.383

The NBC Report states that “the difficulty underlying . . . bankruptcy cases is the

expectation of future claims based upon injury which arises out of this debtor’s earlier

conduct, but has not yet manifested itself.”384 This indicates that those who have not yet

come into contact with the product would not be covered by the NBC amended definition of “claim.”

While agreeing with Mabey and Zisser that the approach in the NBC proposed amendments is far superior to the Manville Amendments, Heidt expressed concern that the

NBC’s definition of future claimant would exclude Piper-like claimants who had not yet

come into contact with the product at the time of reorganization but are later injured.385

Further, Heidt disagrees with the NBC proposal that the plan proponent may decide

whether future claims should be in or out. “Future claims” should be clearly defined, and

future claimants should be free to participate in the bankruptcy—it should not be left up

to a plan proponent to decide whether future claims are in or out.386

Heidt suggests that the best manner in which to go about resolving the problem is to

focus first on bankruptcy principles.387 The first principle is that of treating similar creditors similarly (“equality is equity”), and the second is the principle of a fresh financial

start for the debtor.388 Under the first principle, future claimants injured by the same act,

381. Kathryn R. Heidt, Future Claims in Bankruptcy: The NBC Amendments Do Not Go Far Enough, 69

Am. Bankr. L.J. 515 (1995).

382. See id. at 518.

383. See id at 518–19

384. NBRC Report, at D, Introduction, at P1, cited in id. at 518.

385. See Heidt, supra note 381, at 518.

386. See id. at 519.

387. See id. at 520.

388. See id.
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defect, or omission as present claimants should be included in the bankruptcy process.

Presents and futures, she contends, are similarly situated and should be treated similarly.

To leave out futures not only treats them differently but devalues the going concern value

of the business by exposing it to future lawsuits. Heidt believes that the Piper distinction

of contact between the debtor and creditor unduly detracts from this policy of treating

similarly situated creditors similarly.389 It should be noted, however, that at least one commentator does not view present and future claimants as similarly situated.390 Under the

second principle, excluding future claimants exposes the going concern to liability. This

exposure plainly violates the congressional policy of giving a reorganized business a fresh

financial start.391

Heidt does not necessarily find fault with the present definition of a “claim” in the

Bankruptcy Code. She asserts that the real problem is not with whether or not there is a

“claim” (she argues that futures are included in the definition) but when a claim “arose.”392

Heidt believes the Bankruptcy Code ought to specify that claims “arise” “when the debtor

did the acts on which the obligation is based, usually when it manufactured the product.”393

The NBRC test is really a conduct test with added tests to limit its application to mass

torts claims in which claimants are knowable and the value of claims is capable of estimation. Its proposed definition of claim requires that the conduct that ultimately gives rise

389. See id. at 521.

390. See Jeffrey Davis, Cramming Down Future Claims in Bankruptcy: Fairness, Bankruptcy Policy, Due

Process, and the Lessons of the Piper Reorganization, 70 Am. Bankr. L.J. 329 (1996). Davis sees an important

difference in one who is presently living with an injury and aware of that injury as opposed to one who has

not yet manifested the injury and is not aware of the potential injury. Further, Davis argues that treating

present and future claims as equal would violate principles of maximizing the estate for distribution. See id.

at 332. Davis relies on Manville as an example to demonstrate that often the creation of a fund may be

unworkable—he further notes that many companies are simply too small to deal with the costs of paying a

representative to investigate potential future claims. Davis points out that future claims are rarely a serious

difficulty for a reorganizing business. See id.

However, Davis also argues that future claims should not simply be disregarded. Treating future claims as

unequal to present claims does not mean that they have to be treated unfairly. “Fair treatment of future

claims requires that they be protected from the diversion to present claimants of funds or value that could

meaningfully be distributed to future claimants.” See id. at 367. Davis believes that there are protections for

future claimants inherent in the cramdown process (e.g., market forces and legal representatives). See id. at

368–69.

391. See Heidt, supra note 381, at 521–22.

392. Id. at 522.

393. Id.
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to the injury have occurred before the bankruptcy petition is filed. The NBRC proposal

does not require a pre-petition relationship as such if there are mass claims involving

identifiable claimants. Requiring that the claimants be identifiable seems designed to serve

as a substitute for requiring a prior relationship between claimant and debtor.

However, the NBRC definition limits a bankruptcy court’s ability to channel liabilities

away from a reorganized entity that are “so unforeseeable or speculative that they are not

reasonably capable of approximation.”394 The NBRC further points out that it has purposely not required a showing of insolvency so as to encourage the settlement of mass

torts liability through the bankruptcy process. The requirement that future claimants be

identifiable should ameliorate the due process concerns raised by a pure conduct test.

The requirement that the liability be estimable is intended to act to filter out debtors

dealing with highly speculative liabilities. 395

e. Estimating claims

Once future claims have been defined, it becomes essential in a mass tort case to estimate the size and number of all present and future claims, and the code provides authority to do so.396 This figure will determine how large a trust will need to be to pay such

claims fully or to provide a pro rata share. Estimations of classes of claims also allow

reorganization proponents to provide fairly and equitably for creditors in different classes

(e.g., by providing for the same pro rata share to be given personal injury creditors and

trade creditors).

Estimation of claims is not to be confused with liquidation—liquidation requires a

conclusive finding of a specific sum while estimation is a device used to keep the case

moving forward. Estimation’s goals are to “provide greater certainty of recovery and resolution of contingent and unliquidated claims during the bankruptcy process.”397 A bankruptcy court is prohibited from estimating “contingent or unliquidated personal injury

tort or wrongful death claims against the estate for purposes of distribution in a case under

title 11.”398 A jury trial may be requested to determine the actual amount of a claim for

394. NBRC Report, supra note 364, at 327.

395. Id. at 327–28.

396. 11 U.S.C. § 502(c) provides:

“There shall be estimated for purposes of allowance under this section— (1) any contingent or unliquidated claim, the fixing or liquidation of which, as the case may be, would unduly delay the administration of

the case; or (2) any right to payment arising from a right to an equitable remedy for breach of performance.”

397. Harvey R. Miller et al., Formulation and Confirmation of Chapter 11 Plans Under the Bankruptcy

Code, Chapter 11 Business Reorganizations 173, 285 (1988), referring to In re Baldwin-United Corp., 55 B.R.

885, 898 (Bankr. S.D. Ohio 1985).

398. 28 U.S.C. § 157(b)(2)(B) (1994) (emphasis added).
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distribution purposes.399 Courts have estimated potential personal injury liability in the

mass torts context.400

The estimation process may be particularly useful if future claimants are included in

the bankruptcy process.401 We will look at a mass torts estimation to examine further

how the process works.

 f. Estimation of claims in the A.H. Robins reorganization case

The A.H. Robins case was one instance in which an estimation process played a central

role. Richard Sobol, an attorney, has written a book called Bending the Law that is devoted

exclusively to the Robins reorganization case and is the primary source for this discussion.

Robins, the equity committee, Aetna, and the Dalkon Shield claimants’ committee all

employed processes of (1) identifying the women in the sample deemed to be entitled to

compensation at historic levels; (2) determining the values of their claims, generally by

reference to databases containing information taken from resolved cases; and (3) projecting these values to the universe of eligible claims.402 Sobol points out some serious methodological concerns with regard to how these accepted methodologies were implemented.

Sobol’s main critique is that the experts made non-scientific assumptions about precisely how many women would file claims and about the criteria to be used in the evaluating a claim.403 Sobol notes:

A serious shortcoming with the methodology concerned the identification of the

claims in the sample to which historic value would be accorded. Ideally, in statistical

sampling the pertinent information is determined concerning the sample and the assumption is made that the same factual pattern will be replicated in the universe. If 25

percent of the homes in a statistically valid sample are tuned to the “Cosby Show,” it is

assumed that 25 percent of all the homes in the universe from which the sample was

drawn are tuned to the “Cosby Show.” The comparable methodology for estimating the

399. See 11 U.S.C. § 1141(a), cited in Miller, supra note 397, at 294.

400. See A.H. Robins v. Piccinin, 788 F.2d 994, 1012–13 (4th Cir. 1986).

401. See Houser, supra note 355, at 115 (“The claims estimation process is particularly well-suited to

future claims, which by their very nature could delay the administration of a bankruptcy case.”). Houser also

finds that the estimation process will be of more value if it can be used to set a limit on the amount to be

distributed to future claimants than if it used solely to decide whether a proposed plan is feasible. Id.

402. Sobol, supra note 356, at 181. Added to the estimation was the cost of nuisance payments for claimants that were excluded, future claimant costs, costs to nonuser claims, and administration costs. See id.

403. See id.
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value of the universe of Dalkon Shield claims would be actually to liquidate the claims

in a sample, using the procedures that would be used to liquidate claims under the plan

of reorganization, and to project the liquidated value of the sample to the universe.

That was not done. Rather, the parties’ experts made assumptions concerning the

number of women in the sample who would present their claims for payment, and

concerning the criteria by which the claims that were presented would be evaluated and

paid. The differences among the estimates depended almost entirely on the differences

in these assumptions. The witnesses had no expertise relative to these matters, and no

evidence or even opinion was offered in support of the assumptions that were made.

The witnesses simply made the assumptions that would support the result favored by

their employer.404

As an example, Sobol points to a witness who assumed that every member of the

sample who did not return a questionnaire and health records would not file a claim for

damages. This number was nearly 50%. Another expert assumed that every woman in the

sample would participate in the trust. Sobol asserts that there are many reasons that more

women would participate in the claims resolution process than would participate in the

estimation questionnaire process. For example, the questionnaire asked numerous questions about a woman’s sexual history. Further, the sample procedure discounted responses

if they were deficient in any way. Finally, participating in the sample did not lead to financial compensation while participating in the claims resolution process would.405

Plaintiffs’ attorneys attempted to introduce several victims’ testimony in order to give

the judge a sample of “the actual impact on women’s lives.” District Judge Robert R.

Merhige, Jr. ruled that such evidence was irrelevant to the estimation process because it

related only to one individual’s claim.406 Ultimately Judge Merhige only allowed counsel

from the official claimants’ committee to participate in the estimation proceeding.407

The parties testimony resulted in estimates ranging from $1.215 billion (Robins) to

$2.5 billion (Aetna) to $7.167 billion (claimants’ committee).408 After the parties’ experts

testified, Judge Merhige encouraged the parties to agree on an estimation of the claims.

After settlement negotiations bogged down, Judge Merhige, reportedly “[f]rustrated and

angry,” announced his estimate of the claims to be $2.475 billion. He did not offer reasons

for this figure, but its proximity to Robins’ insurer’s estimate suggests a rationale. After

404. Id. at 181.

405. See id. at 182.

406. While plaintiffs’ counsel actually called one of these witnesses at trial arguing the testimony was

applicable to every claim, their efforts were once again rebuffed by Judge Merhige. See id. at 179–80.

407. See id. at 179.

408. See id. at 183–96, esp. Table 13.1.
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the judge rebuffed efforts to get an explanation of the above figure, the court of appeals

affirmed his estimate and rejected claimants’ argument that they were entitled to an explanation of the figure.409

g. NBRC claims estimation proposal

The NBRC has also proposed an amendment to the Bankruptcy Code that specifically

recognizes a bankruptcy court’s authority to estimate mass future claims for purposes of

allowance, voting, and distribution.410 The NBRC deliberately avoided proscribing any

particular method of estimation in order to maintain flexibility in the process. Courts

would retain discretion in articulating the purposes for which they estimate future

claims.411

This recommendation would not interfere with the right to a jury trial for personal

injury or wrongful death claims, which the Seventh Amendment and the Bankruptcy

Code preserves. The estimate would be used only to decide how large the trust must be to

compensate those making claims against it. The reorganization plan will generally specify

the manner in which jury awards become obligations of a claimants’ trust.

Judge Jones finds it an “extraordinary proposition . . . that a bankruptcy court—hardly

a forum that routinely decides injury cases—could fix and liquidate perhaps thousands

of tort or contract claims without conducting a single jury trial.”412 On the other hand if

there is to be an estimation process, she would mandate its use in every case so that it

“would perform the same role as a class action fairness hearing on settlement.”413

h. Channeling injunctions

The NBRC also recommended that section 524 of the Bankruptcy Code authorize a

bankruptcy court to issue a channeling injunction, which “steers claimants toward a trust

or pool of assets to compensate claimants as it simultaneously steers those claimants

away from the reorganized entity.”414 The NBRC notes that channeling claims reinforces

the effect of discharge in that the debtor does not have to deal with individual creditors.

The NBRC further notes that it has not explicitly set out a precise form for channeling

injunctions because a court should be free to fashion a channeling injunction that best

fits the situation at hand. For example, alternative ways of assuring adequate funding of a

trust or of distributing excess funds can be explored under the broad authority the NBRC

409. See In re A.H. Robins Co., 880 F.2d 694, 697 (4th Cir.), cert. denied, 493 U.S. 959 (1989).

410. NBRC Report, supra note 364, at 341–44.

411. Id. at 343.

412. Jones, supra note 365, at 1714.

413. Id. at 1715.

414. NBRC Report, supra note 364, at 345.
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proposes.415 Judge Jones warns that the NBRC channeling injunction, “by definition, would

prevent future claimants from suing not only the debtor, but whatever third parties to the

debtor’s liability the court thought it equitable to protect.”416

i. Due process and future claims

In discussing class actions, Professor Richard Marcus addresses problems related to

notice of future claimants.417 Marcus argues that while class actions have involved serious

efforts to notify class members, there must be a more serious effort to notify those who

have been exposed to a dangerous product but have not yet manifested injury. In his

words:

Unless claimants with unmanifested claims are absolutely protected against having

to decide now whether to exclude themselves from a class action, the ultimate question

for mass tort class actions is whether they can adequately identify and inform absent

class members of their rights. Given the underlying Erie issues and the nature of these

claims, intense scrutiny of both the efforts and their results is warranted. Given the

immense amounts at stake in the current settlements, even the multi-million dollar

efforts mounted by their proponents may not suffice. Moreover, where there are requirements (such as those in Silicone Gel) that claimants take affirmative action by

registering to protect their rights, the attention to notice should be even more exacting.

There are certainly indications that even the million-dollar notice efforts in the recent

cases may be found inadequate.418

Such concerns might be even greater in the bankruptcy context where the statutory

framework grants more specific rights to claimants, including the right to vote on a proposed plan and to invoke the absolute priority rule and the best interests of creditors

rule.419 Approaching due process issues from their bankruptcy experiences, Bankruptcy

Judge Russell Eisenberg and attorney Frances Gecker suggest using the class action standard to evaluate the fairness of notice in the bankruptcy context because of the similarities between limited fund class actions and bankruptcies with regard to due process concerns.420

415. See id. at 347.

416. Jones, supra note 365, at 1717.

417. See Marcus, supra note 70, at 894–95.

418. Id. at 894–95.

419. See discussion supra notes 348–349. The Business Bankruptcy Committee of the ABA expressed

concern that the NBRC proposals invite analysis of “difficult and complex issues,” especially “the due process

rights of holders of mass future claims.” Brunstad et al., supra note 365, at 1451.

420. See Russell A. Eisenberg & Frances Gecker, Due Process and Bankruptcy: A Contradiction in Terms?,

10 Bankr. Dev. J. 47 (1993).
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 Obviously, both limited funds and bankruptcies deal with classes or groups of individuals, and in bankruptcy individuals tend to act “in homogeneous groups, establish

official and unofficial committees, and take many actions as a group of people.”421 Judge

Eisenberg and Ms. Gecker point out that Fed. R. Bank. P. 7023 incorporates Rule 23 which

states, “[i]n any class action maintained under subdivision (b)(3), the court shall direct to

the members of the class the best notice practicable under the circumstances, including

individual notice to all members who can be identified through reasonable effort.”422

Rule 23(c) is designed to alert parties of pending class actions and to give parties in interest an opportunity to decide whether or not to participate.423 Judge Eisenberg and Ms.

Gecker assert that this standard should be used in bankruptcy matters. Failure to provide

notice to future asbestos claimants, for example, has been held to invalidate a proposed

discharge of their claims.424 A party in bankruptcy who is on notice and does nothing

should lose his or her rights just as a party in a limited fund class action would.425 If there

are known but not identifiable future claimants, a representative should be appointed to

act on their behalf; notice by publication will not suffice in such circumstances.426

To provide due process for future claimants, the NBRC proposal calls for appointment of a representative for future claimants. According to Judge Jones, the future claims

representative would have “extraordinary exclusive power . . . to file and compromise

class claims,” would operate “without the supervision or control of real clients,” and possess only “inherently weak” bargaining powers.427 The NBRC proposal stipulates that the

future claims representative not hold any interest adverse to the class,428 but Judge Jones

questions whether this would satisfy the adequacy of representation standard in Rule

23(a)(4) which the Supreme Court applied in Amchem.

429

In summary, constitutional due process applies with full force in bankruptcy cases

and proceedings. The importance of the interests of future claimants and the need for

prompt action on those interests demands special efforts to provide actual notice or fiduciary representation.

421. Id. at 96.

422. Fed. R. Civ. P. 23(c).

423. See Eisenberg & Gecker, supra note 420, at 97.

424. See id. at 105–06, citing Waterman Steamship Corp. v. Aguiar, 141 B.R. 552 (Bankr. S.D.N.Y. 1992).

425. See id.

426. See id. at 107.

427. Jones, supra note 365, at 1713.

428. NBRC Report, supra note 364, at 332.

429. Jones, supra note 365, at 1713.
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j. Bankruptcy and limited fund class actions compared

When balancing the relative strengths and weaknesses of resolving mass torts through

the bankruptcy process or through class actions, the most obvious strength of the bankruptcy court is its jurisdictional reach. Mabey and Zisser point out that in a Rule 23 class

action the court “(i) lacks personal jurisdiction over unwilling plaintiffs, (ii) is arguably

unable to enjoin proceedings pending in other courts, and (iii) does not now have removal jurisdiction from state to federal courts absent complete diversity.”430 A bankruptcy

court does not have to deal with any of these obstacles. All personal injury and wrongful

death tort actions must be removed to the district court (in which the bankruptcy case is

pending), and the bankruptcy court has personal nationwide jurisdiction over every creditor of the debtor.431 Further, Mabey and Zisser comment, the bankruptcy court has the

power to enjoin all actions that may impact the estate.432 Finally, Mabey and Zisser point

out that the bankruptcy courts’ treatment of future claims emanates from the Bankruptcy

Clause of the Constitution and the Bankruptcy Code itself.433

John Coffee has argued that the Chapter 11 reorganization process has both substantive and procedural advantages over class actions in reaching a fair resolution for tort

creditors.434 As noted above, bankruptcy reorganization cases follow the absolute priority

rule. Bankruptcy principles also follow a norm of temporal equality, the equitable principle that requires all claimants or interests in the same class be treated equally even if

their claims did not mature at the same time.435

Coffee goes on to point out that class actions settlements violate these two principles.436

A Rule 23(b)(1)(B) limited fund class action is essentially a bankruptcy in thin disguise.

In a bankruptcy, tort creditors would receive full payment before stockholders would

receive any compensation (except to the extent they agree to a different treatment). However, in the limited fund class action that settles, which it is very likely to do given the

430. Mabey & Zisser, supra note 368, at 489 (footnotes omitted).

431. See Mabey & Zisser, supra note 368, at 489–90. Cases are to be tried in the district court in which the

bankruptcy case is pending or in the district court in the district in which the claim arose. For a discussion of

the possible reach of bankruptcy jurisdiction to codefendants of the debtor, see Note, Why Bankruptcy “Related to” Jurisdiction Should Not Reach Mass Tort Nondebtor Codefendants, 73 N.Y.U. L. Rev. 1627 (1998).

432. Id. at 489 n.7.

433. Id. at 490. Mabey and Zisser state, “Thus, in applying procedural due process balancing tests, because

the governmental interest is greater, the bankruptcy court’s treatment of future claims is more likely to pass

constitutional muster than is similar treatment by a class action court.” Id. at 490–91 (footnotes omitted).

434. See Coffee, supra note 69, at 1458.

435. See id.

436. See id. at 1459.
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attorney incentives, tort claimants often get a percentage of the value of their claims while

stock value soars because of the release from the liability.437 Further, mass torts settlements often violate temporal equality. Future claimants suffer at the hands of present

claimants if more present claimants come forward than expected and deplete the trust

fund.438

All is not necessarily fair in all mass torts bankruptcies either. Thomas Smith comments that mass torts bankruptcies suffer keenly from distributional problems.439 While

Smith recognizes that the bankruptcy process does recognize principles such as absolute

priority and temporal equality, he notes that “[s]trong forces militate against equal treatment of present and future claimants.”440 Smith examines three factors affecting allocation decisions.441 The first category he calls psychological factors which he capsulizes in

the phrase “vividness effect.”442 Present claimants have psychological advantages over futures because they have visible and often urgent needs for compensation to pay medical

debts or personal expenses after being incapacitated. On the other hand, futures are “statistical probabilities.”443 In Smith’s view, it is inherently difficult as a representative of

future claimants to persuade a judge to forgo compensating present plaintiffs in favor of

unknown future claimants.

Second, Smith points out that there is some evidence that judges overvalue reorganized firms and tend to feel that any reorganization gives debtors adequate compensation.444 Overvaluing reorganization may lead to a result that encourages judges to see

437. See id.

438. See id. at 1459–60.

439. Thomas A. Smith, A Capital Markets Approach to Mass Tort Bankruptcy, 104 Yale L.J. 367, 371 (1994).

440. Id. at 372.

441. See id. at 383–91.

442. Id. at 383.

443. Id.

444. Id. at 384, citing J. Ronald Trost, Corporate Bankruptcy Reorganizations: For the Benefit of Creditors or

Stockholders?, 21 UCLA L. Rev. 540, 544–46 (1973) (discussed below); Walter J. Blum, The Law and Language

of Corporate Reorganization, 17 U Chi. L. Rev. 565, 577–78 (1950) (discussing the differences between reorganization value and market value).

Trost states that the most basic question in the valuation of a corporation is how much the reorganized

corporation is likely to earn. First, one must estimate average annual future earnings. Second, one must

estimate the length of life the reorganized business will have. Finally, one must decide the appropriate rate of

return on earnings. Trost goes on to state that “[s]ome courts and commentators are more candid than others

about the difficulties inherent in the valuation problem.” Particularly, the choice of capitalization rate is

difficult to estimate with any certainty. “By a slight change of the capitalization rate, an insolvent company in

which shareholders are denied participation becomes a solvent company in which shareholders are entitled

to some kind of interest.” See Trost at 546.
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treatment of futures in a rosy light. Whether future claimants are being treated fairly or

not, the judge may just want to get rid of the problem to push the plan through the

confirmation hearing. Further, juries in a mass tort case are only deciding the value of the

present value claims. Bankruptcy requires that a conscious decision be made to deprive

present claimants of certain compensation in favor of the probability that future claimants might benefit.445 Smith also points out that attorneys representing present claimants

in a Chapter 11 case often benefit more financially from a plan than the representative of

future claimants. Representatives of futures are typically paid from the estate itself, and a

judge eager to push a plan through is more likely to appoint a representative that the

judge believes may be more accommodating to a plan that does not treat futures fairly. 446

Finally, Smith points out that strategic behavior in bankruptcy clearly advantages

present claimants over future claimants. The only safeguard for future claimants is the

court itself whose role, Smith believes, “is less to ensure that future claimants receive the

maximum possible or even a fair share, than it is to ensure that the parties reach some

agreement.”447 Smith points out the advantages to equity in delaying the bankruptcy’s

completion and the pressure this creates for present claimants who often need a quick

resolution. Present claimants may choose to participate in a compromise with equity

holders that disadvantages future claimants.448

Smith’s solution to what he sees as structural disadvantages for future claimants is to

create a new structure—a “capital markets approach” to the estimation of liability to future claimants and the distribution of value to all claimants. Under such an approach,

claimants would be paid in shares of a trust fund or bonds issued by a solvent company.

Market forces would establish the value of the shares or bonds, creating financial incentives for the accurate assessment of future liability.449 Evaluation of Smith’s proposals,

which call for a total restructuring of Chapter 11,450 is beyond the scope of this review.

445. See Smith, supra note 439, at 384.

446. See id. at 384.

447. Id. at 385.

448. See id. John Coffee has suggested that many of these problems of lack of fairness with regard to

future claimants may be resolved by (1) requiring courts to find that future claimants interests will be fairly

protected in a class action as a part of the superiority requirement, (2) certifying limited fund class actions for

purposes of liability only, and (3) giving future claimants the deferred right to opt-out in a class action (e.g.,

even after a settlement has been approved). See Coffee, supra note 69, at 1433.

449. Smith, supra note 439, at 394–433.

450. See id. at 429–31, 439. For a succinct summary of the vibrant and extensive literature supporting and

criticizing the current Chapter 11 reorganization approach, see id. at 430 n.188. For a creative proposal to

improve protection for future claimants through a system of pro rata distribution of funds to compensate

mass tort claimants, see Note, Is There a Future for Future Claimants After Amchem Products, Inc. v. Windsor?,

107 Yale L.J. 2545 (1998).
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Along the same lines as Smith and contrary to Coffee and Mabey and Zisser, Judge

Jones is skeptical of the advantages asserted for bankruptcy courts vis-à-vis class actions.

The absolute priority rule, voting rights, and protections against cram downs, she asserts,

are “overrated as applied to the unique status of a class of mass future claims.” Because

“most plans are ultimately consensual, a mass future claims class, like other senior creditor classes, will eventually compromise its interests with those of equity holders.”451 Overall

Judge Jones raise a rhetorical, but key question: “whether the mass future claims proposals have anything to do with bankruptcy, or whether they are a contrivance to shoehorn

mass torts litigation into a coercive, collective settlement that preserves management control and shareholder equity.”452

We have no intention of attempting to resolve the debate about the relative advantages and disadvantages of bankruptcy and limited fund class actions. The Supreme Court

may clarify some of the due process issues for us in the near future. Suffice it to say at this

point that bankruptcy and class actions each face challenges in dealing with due process

and the fair and equitable treatment of future claimants.

k. Delays and emergency medical procedures

Finally, a major criticism of the bankruptcy process arises out of the long delays experienced in the Manville453 and Robins454 reorganization cases. One consequence of such

delays is that tort victims without insurance or other resources may not be able to obtain

emergency medical procedures. For example, in Robins, some of the infertility caused by

the Dalkon Shield could have been reversed surgically if action had been taken before the

women reached the age of forty.455 Claimants’ counsel put together a plan to fund emergency surgery that achieved the consent of all but the shareholders’ committee. Judge

Merhige’s order implementing the plan was reversed by the court of appeals.456

451. Jones, supra note 365, at 1719–20.

452. Id. at 1722.

453. See, e.g., Frank J. Macchiarola, The Manville Personal Injury Settlement Trust: Lessons for the Future,

17 Cardozo L. Rev. 583, 627 (1996) (“It is a shame that it took fourteen years for these lessons to be learned.”).

454. In Robins, the Chapter 11 petition was filed in August 1985. The claimants’ trust received full funding in December 1989. See Vairo, Georgine, supra note 310, at 155. Administration of the trust “is likely to

effectively complete its mission by the end of 1998.” Id.

455. See Sobol, supra note 356, at 129–30.

456. See Official Committee of Equity Security Holders v. Mabey, 832 F.2d 299 (4th Cir. 1987). For commentary of how the order was developed and critiques of the ruling in Mabey, see Sobol, supra note 356, at

129–35; Jason A. Rosenthal, Courts of Inequity: The Bankruptcy Laws’ Failure To Adequately Protect the Dalkon

Shield Victims, 45 Fla. L. Rev. 223, 226–32 (1993).
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In ordinary litigation a court can schedule a civil lawsuit for trial promptly or otherwise take action under its equitable powers to address such emergencies. The bankruptcy

process currently does not provide an express mechanism for tort victims to be immediately compensated for emergency medical procedures. Rosenthal argues that tort creditors may suffer irreparable harm while waiting for plan confirmation.457 He points out

that there are some general powers that bankruptcy courts might invoke to protect tort

victims,458 but finds these tools to be inherently “weak.” Rosenthal argues that Congress

should amend the Bankruptcy Code to explicitly grant the court the ability to require

entities seeking reorganization under Chapter 11 to make preconfirmation payments for

the express purpose of paying tort victims emergency medical expenses.459 Sobol calls for

a similar amendment.460

6. Summary and conclusions

The disparate approaches discussed in this section are similar in that they all depend on

existing law and procedural rules, although some, such as statistical sampling, require an

evolutionary extension of current laws and rules. Another common feature of all of the

above approaches is that they all have major deficiencies that inhibit a comprehensive

resolution of a single mass tort.

Some options, such as opt-out settlement class actions and Chapter 11 reorganization

cases, depend on cooperation or consent of the parties in interest for effective use. Of

course, there are involuntary remedies in bankruptcy cases and in limited fund class actions, but for the most part these remedies are not invoked unless the parties in interest

have exhausted all opportunities to resolve these matters through negotiations. Judicial

consideration of mandatory remedies seems unlikely in the absence of defendants’ agreement with a critical mass of plaintiffs and their attorneys.

Even the sweeping remedies involved in the aggregation of risk-based claims and in

the use of statistical sampling thus far have found some of their most successful uses in

designing settlements that are advantageous to all sides in the litigation. At the least, acquiescence and cooperation enhance the success of those remedies. Resistance, as Cimino

457. See Rosenthal, supra note 456, at 226–27.

458. These tools include a bankruptcy court using its equitable powers under section 105 of the bankruptcy code to “respond flexibly to the extraordinary problems which may arise in a bankruptcy case,” using

the common-law doctrine of necessity, or using section 363 of the code to permit preconfirmation payments

as justified by a “business purpose.” Id. at 232.

459. See id. at 248.

460. Sobol, supra note 356, at 338.
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illustrates so clearly, can convert a potentially cost-cutting innovation into a source of

drawn-out appeals and additional transaction costs.

On the whole, case-management approaches to mass torts have severe limits. The most

comprehensive approaches discussed above involve extensions, even bending, of existing

law. As we have seen, sometimes those innovations cannot survive appellate review. Accordingly, comprehensive remedies to mass torts problems depend on legislative action.

Whether focusing on a single mass tort like asbestos or tobacco or attempting to create

procedures or establish agencies that can adapt to the wide-ranging variations in mass

torts, many commentators and others believe that only Congress can pull together the

many threads needed to weave a fabric that can support a comprehensive resolution of

mass torts. We address some of those proposals in the next section.

B. Legislative proposals

1. Introduction

To address the full range of problems identified in Part I, legislative proposals need to

have a broad sweep. There appears to be no shortage of proposals to address mass torts

problems, some much less comprehensive than others. The breadth of the proposals seems

directly related to the controversy they spawn. In this section we present and discuss

some of the major proposals and critiques of them. The scope of this review does not

include legislative proposals to create administrative structures to compensate mass torts

victims.461

We begin by addressing the few proposals that have attempted a comprehensive approach: Professor Cooper’s, the American Law Institute’s (ALI) and the American Bar

Association’s (ABA). We first present, without comment, all of the major elements of

these three comprehensive proposals and identify their common features. We then discuss some published critiques and apparent limits of the proposals. Finally, we examine

proposals that focus on single elements, such as federalization of mass torts substantive

law, choice of law alternatives, punitive damages proposals, and other miscellaneous approaches. Because of their close relationship with current bankruptcy approaches, bankruptcy proposals requiring legislation were discussed in Part II.A.5.

461. See, e.g., Lester Brickman, The Asbestos Claims Management Act of 1991: A Proposal to the United

States Congress, 13 Cardozo L. Rev. 1891 (1992); Deborah R. Hensler, Fashioning a National Resolution of

Asbestos Personal Injury Litigation: A Reply to Professor Brickman, 13 Cardozo L. Rev. 1967 (1992).
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2. Professor Cooper’s “bold approach”

As with our discussion of mass torts problems, it seems useful to begin examining legislative proposals by looking at what an all-encompassing proposal looks like. Professor

Edward Cooper has done so in a crisp, footnote-free conception of a “bold approach” to

the issues.462 This seems like a good place to start.

Cooper posits a deceptively simple set of goals: “to achieve a single, uniform, fair, and

efficient resolution of all claims growing out of a set of events so related as to be a ‘mass

tort.’ ”463 It is worth noting that these goals and Cooper’s proposal address most, but not

all, of the idealized criteria identified by Judges Weinstein and Schwarzer in the first part

of this review.464 Missing criteria, like setting priorities for severely disabled claimants

and addressing punitive damages, could be incorporated into Cooper’s approach.

To achieve the goals he specifies, Cooper calls for the following changes in the current

framework of jurisdictional, procedural, and substantive laws and rules:

1. empowering a single court to control all litigation events, select cases for mass

torts treatment, and enjoin litigation in other courts;

2. assigning sufficient judges to handle all claims and to afford appellate review;

3. defining by statute the elements of mass torts claims and administrative processes to determine those claims (in other words, creating a complete compensation system without individual jury trial rights);

4. creating nationwide personal jurisdiction for the entire mass tort;

5. providing for joinder of all who might be liable for a claim or who might have

claims for indemnification;

6. establishing a procedure to identify a single source of applicable law, whether

federal law or a state’s law (to be selected by a mass torts panel of judges);

7. controlling the selection of counsel, but without controlling who the adversaries will be;

8. sending notice “as good as can be managed” to claimholders who can be identified, or appointing representatives for those who do not receive notice;

9. allowing time and procedural opportunities for claims to mature and achieve

any benefits from evolving scientific study;

10. addressing aggregate settlement issues like representation of disparate groups,

participation by claimants, impartial judicial review, and facilitating information and support for objectors.

462. Edward H. Cooper, The (Cloudy) Future of Class Actions, 40 Ariz L. Rev. 923, 946–51 (1998).

463. Id. at 947.

464. See discussion supra notes 18–19.
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Most proposals are not as comprehensive as Cooper’s. Accordingly, they may need to

be supplemented in one or more central areas of concern. For example, the ALI and ABA

proposals summarized below do not deal directly with questions of notice to future claimants, representation of future claimants, or selection of counsel.

3. American Law Institute Complex Litigation Project

In May 1993, the American Law Institute approved a set of proposals emanating from its

Complex Litigation Project. The project spanned seven years of deliberation and drafting, and concentrated on consolidation, choice of law, and transfer of multiforum, multiparty cases among and between federal and state systems. Professor Arthur Miller and

Dean Mary Kay Kane were the reporters.

The project deliberately eschewed addressing matters of substantive law, case-management procedures and related rule-making issues, proposals to limit diversity jurisdiction, and the right to trial by jury.465 On the other hand, as its title implies, the scope of

the project extends well beyond the mass torts field to quite different forms of complex

litigation, such as antitrust or patent actions, that arise under federal law and might involve few individual cases.

The main elements of the ALI project consist of:

1. creating a statutory Complex Litigation Panel that would replace the existing

multidistrict litigation procedure;466

2. setting standards for the panel to apply in deciding whether or not to consolidate cases within the federal system. When cases have been filed in two or more

districts, the panel could consolidate them if they involve common questions of

fact. The primary standard would be that transfer and consolidation “will promote the just, efficient, and fair conduct” of the litigation. Factors to be considered relate to whether transfer or consolidation will result in reducing costs,

duplicative litigation, the likelihood of inconsistent adjudications, and burdens

on the judiciary. The panel would be directed to take into account factors like

the number of parties, the geographic dispersion of the cases, and the stages of

the litigation.467

3. granting broad discretionary power in the transferee court to organize the litigation, identify issues for common treatment, certify classes for the entire litiga465. American Law Institute, supra note 66, at 3–6.

466. Id. at 78.

467. Id. at 36–38.
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tion or particular issues, “prepare a preliminary plan for the disposition of the

litigation,” sever issues for remand or for trial, and transfer damages issues for

consolidated trial either before or after the liability trial;468

4. providing for discretionary judicial review by the Complex Litigation Panel of a

transferee court’s decisions about whether to transfer parts of the litigation and

providing for discretionary interlocutory review of liability decisions, in the court

of appeals of the circuit in which the transferee court is located;469

5. giving the transferee court personal jurisdiction over parties, including later

joined parties, to the full extent permitted by the Constitution and permitting

nationwide and extraterritorial service of subpoenas when authorized by the

transferee court;470

6. authorizing the Complex Litigation Panel to transfer and consolidate actions in

a state court under limited conditions, such as when the litigation is centered in

a single state—the state court would have many of the powers of a federal transferee court, but appellate review of substantive law matters would be in the state’s

appellate courts;471

7. expanding removal jurisdiction to allow the Complex Litigation Panel to remove state court actions that “arise from the same transaction, occurrence, or

series of transactions or occurrences as an action pending in the federal court,

and share a common question of fact with that action,” and specifying seven

factors for the panel to consider in deciding about removal;472

8. conferring discretionary supplemental jurisdiction on a transferee court for

claims that arise out of the same transactions or occurrences or that involve

indemnification related to such transactions or occurrences;473

468. Id. at 106–07. In the comments, the reporters discuss a variety of approaches to damages, including

special master or magistrate judge allocation of individual damages, lump sum assessments based on illegal

profits, or using test cases and encouraging the parties to settle. All options remain subject to jury trial rights.

Id. at 126–27.

469. Id. at 129–30.

470. Id. at 147.

471. Id. at 177–78.

472. Id. at 220–21.

473. Id. at 256–57.
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9. authorizing the transferee court to “enjoin transactionally related proceedings

. . . pending in any state or federal court” that might interfere with the consolidated action;474

10. formulating a federal standard for choosing the state law or laws applicable to

mass torts, establishing explicit rules for choosing among the laws of states with

interests in the transactions because that state is where the injury occurred, where

the conduct causing the injury occurred, or where plaintiffs and defendants habitually reside or do business. If the choice of a single state’s law would be inappropriate, the transferee court is authorized to divide the actions into “subgroups

of claims, issues, or parties to foster consolidated treatment.”475

11. formulating, in a fashion similar to item 10, choice of law standards in cases

involving punitive damages, to determine a single law to apply;476 and

12. providing that the transferee court set forth its choice of applicable law in its

disposition plan and allowing the transferee court to certify the choice of law

issue for immediate appeal.477

4. American Bar Association Commission on Mass Torts

In 1989, the American Bar Association Commission on Mass Torts reported its findings

and recommendations. The Commission consisted of twelve members, including federal

and state judges, experienced plaintiffs’ and defendants’ attorneys, the general counsel for

a pharmaceutical company, the general counsel for a large insurance carrier, and a law

professor.

As noted in Part I, above, the Commission defines “mass tort litigation” to include a

set of “at least 100 civil tort actions arising from a single accident or use of or exposure to

the same product or substance, each of which involves a claim in excess of $50,000 for

wrongful death, personal injury or physical damage to or destruction of tangible property.”478 The Commission calls for federal legislation to establish a federal judicial panel

to identify mass torts litigation that fits the above definition and to direct that “some or

all individual actions . . . be consolidated before a federal court empowered to resolve all

issues including liability and damages.”479

Federal original and removal jurisdiction would be created for all cases in a mass tort

litigation without regard to diversity of citizenship and federal courts would be empow474. Id. at 263.

475. Id. at 321–22.

476. Id. at 405–07.

477. Id. at 425–26.

478. ABA Commission Report, supra note 20, at 26.

479. Id.
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ered to select applicable state law “by choice of law standards developed by the federal

courts in light of reason and experience.”480 Punitive damages claims against the same

defendant arising from “the same or substantially similar conduct” should be consolidated before one court that would award a single judgment to be allocated among plaintiffs and public purposes. Standards for awarding punitive damages would be restricted

in various ways, both procedurally and substantively.481

Legislation would also provide that, in appropriate cases, a court could convene a

panel of two or more impartial experts and invite findings that would be submitted to the

trier of fact; depositions of these court experts could be used at trial.482 Courts would also

be permitted to use alternative dispute resolution techniques that did not impair or deny

the right to trial by jury.483 A court would be empowered to enforce a settlement that bars

“additional claims of those who have not sued or those who may not yet be able to sue.”484

Bench and bar are encouraged to develop guidelines to determine reasonable fees and

expenses in mass torts litigation. Courts handling mass torts litigation would be empowered to regulate attorneys’ fees and expenses according to such published guidelines.485

The House of Delegates of the ABA did not approve the Commission’s report. It was

withdrawn without a vote after a “‘barrage of last-minute criticism.’ ” At the same meeting, delegates opposed proposed federal multiparty, multiforum legislation, apparently

because delegates saw it as intruding on state law sovereignty.486 Despite its fate within

the ABA, the main proposal as well as the dissenting proposal, discussed below, warrant

attention because they represent thoughtful efforts to craft comprehensive measures to

deal with various types of mass torts litigation.

5. Rheingold dissent and proposal

Commissioner Paul Rheingold, an experienced plaintiffs’ mass torts lawyer, dissented vigorously from the ABA Commission report and presented the outlines of his own pro480. Id. at 40.

481. Id. at 46.

482. Id. at 58–59.

483. Id. at 59.

484. Id.

485. Id. at 62–63.

486. See Thomas D. Rowe, Jr., Jurisdictional and Transfer Proposals for Complex Litigation, 10 Rev. Litig.

325, 353 (1991), citing ABA Backs Abortion Rights, Right to Die, and Job Protection, 58 U.S.L.W. 2474, 2477

(Feb. 20, 1990).
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posal to address mass torts. Rheingold starts with the observation that only “a few very

rare types of litigation [asbestos, Agent Orange, and Dalkon Shield] . . . need . . . a radical

revision of the laws. . .”487 He asserts that the Commission’s remedy is “both too weak for

true mass torts and unnecessarily intrusive for routine mass torts.”488 In the true mass

torts, there have been more than 200,000 claims whereas in the other sets of litigation,

such as Bendectin and DES, there have generally been around 2,000 cases.489 The same

remedies do not fit both types of litigation, and the ABA proposal is the product of a

“compromise” that “fits no known example of litigation to date.”490

To deal with the true mass tort, Rheingold proposes a definition that would require

thousands of cases to have been filed in federal and state courts across the country with a

foreseeable expectation that thousands more will be filed plus a risk that there will not be

sufficient assets, including insurance and net worth, to satisfy present and future claims.491

In those instances, he proposes:

1. assigning all cases to one federal judge, using a federal selection panel as recommended in the main ABA proposal;

2. assigning cases for all purposes;

3. declaring the consolidation to be “a mandatory, no opt-out suit;”492

4. appointing a representative of the future class (as in Manville and Dalkon Shield

bankruptcies);

5. including all possible defendants and insurers;

6. conducting comprehensive, one-time discovery;

7. when causation is controverted, giving the judge “extraordinary powers to call

in the scientists and review the literature in order to determine the degree of

certainty on causation” and the power to “supplant the fact-finders with his own

findings;”493

487. ABA Commission Report, supra note 20, at 1e.

488. Id.

489. Our estimates of the number of claims in mass tort litigations confirm Rheingold’s. Thomas E.

Willging, Individual Characteristics of Mass Tort Case Congregations: A Report to the Mass Torts Working

Group Table 1 (Federal Judicial Center 1999). We estimated that three mass torts (asbestos, Dalkon Shield,

and silicone gel breast implants) had more than 100,000 claims. We estimated a much smaller number than

Rheingold for Agent Orange claims, but between 600,000 and 2.4 million individuals were exposed to those

chemical agents. Other mass torts tended to have claims in the 100 to 20,000 claim range. Id.

490. ABA Commission Report, supra note 20, at 7e.

491. Id.

492. Id. at 8e.

493. Id. at 9e.
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8. giving the judge the power to award proportionate damages, calibrated to “the

percentage of chance that he or she was injured by the exposure;”494

9. authorizing the judge to select applicable law in the form of “one rule per issue,”

which might be the “best” or the “average” or “consensus” law;495

10. freely allowing and expediting interlocutory appeals;

11. deciding punitive damages in a single trial, after evidence has had time to evolve,

and distributing any award to claimants after compensatory damages are fully

funded;

12. granting the judge full power to divide the issues for trial and to use separate

juries for different issues

13. allowing “mass techniques” to deal with the “most monumental task” of allocating individual damages, e.g., by trying representative cases, using ADR techniques, and developing schedules based on jury awards;

14. creating funds for future claimants, as in the Manville and Dalkon Shield cases;

and

15. creating a fund for compensatory damages to presently injured claimants, either

in the form of medical monitoring, payment for enhanced risk of future injury,

or a reserve against which damages would be paid to claimant who develop further diseases.

In a number of aspects—particularly in dealing with the problem of future claimants

and in dealing with joinder of other parties who might be liable—Rheingold’s proposal is

more comprehensive that the main ABA report. Rheingold also differs in calling for

aggregative techniques to assign individual damages rather than relying on individual

jury trials.

6. Comprehensive plans compared

In referring to comprehensive plans, we include the Cooper, American Law Institute,

American Bar Association, and Rheingold plans.496 All four comprehensive plans provide

for a single court or panel to make initial decisions as to what cases should be included in

the mass torts process. Because all four proposals define thresholds based on numbers of

494. Id.

495. Id. at 10e.

496. Professor Rowe has reviewed and compared three of these proposals, but the ALI proposal reviewed

was an earlier draft that has been amended considerably. See Rowe, supra note 486, at 325. The ALI proposal

is discussed extensively in Symposium, American Law Institute Complex Litigation Project, 54 La. L. Rev. 833

(1994).
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cases filed, under any of them immature litigations could be treated as mass torts. Each

plan provides a different approach to defining mass torts. The ABA has a broad definition, setting objective standards that many litigations could satisfy. Rheingold sets a narrower threshold, limiting entree to the handful of massive cases like asbestos and Dalkon

Shield. The ALI would set broad general standards for a specialized panel to apply to all

potentially complex litigation.

Each proposal envisions some system of specialized tribunals to handle the cases. The

ALI delegates power to a single transferee judge, and the ABA looks toward a single court.

Cooper and Rheingold address more directly the need to assign sufficient judges to handle

the pretrial, trial, and appeals of claims.

All four proposals envision nationwide personal jurisdiction. All but the ABA proposal contain provisions for joinder of related defendants and insurers.

Only Cooper calls for a single federal statutory law to apply to claims that qualify.

Other proposals express a need to attempt to find a single applicable law by recommending changes in the choice of law rules. The ALI proposal would establish federal standards

and a rather complex hierarchy of objective rules for determining which state’s laws should

apply. The ABA proposal would authorize federal courts to develop and apply federal

common law choice-of-law rules. Rheingold’s variations would direct a court to choose

one rule of law per issue, leaving considerable room for disagreement as to what that rule

should be.

Only the Cooper proposal seems to grapple with questions relating to future claims,

including appointment of counsel and a future claims representative and giving notice to

future claimants. Rheingold provides for the court to create a fund to compensate future

claimants. The ABA would allow handling future claims in a settlement and issuing a bar

order against later assertion of such claims against a defendant directly.

Regarding settlement, only the Cooper proposal addresses procedural aspects of judicial review of settlements, including participation by claimants and objectors in the review process. The ALI and ABA proposals expressly provide for enforcing aggregate settlement by authorizing injunctions against related litigation in other courts.

On punitive damages, Cooper does not address the issues directly, but presumably his

call for federal substantive law would include federal statutory standards for awarding

punitive damages. Again, the ALI proposal looks primarily to setting choice of law standards and having a single law govern. The ABA proposal would establish federal standards for punitive damages that are more restrictive than the laws of many states and

limit punitive awards to a single judgment. Rheingold advocates a similar approach with

the single award to be distributed only after compensatory awards have been paid.
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7. Critiques of the comprehensive proposals

As a practical matter, the most telling critique of the ABA proposal is that it was not able

to achieve an endorsement by the ABA’s own House of Delegates. Despite the many compromises—juxtaposed against Paul Rheingold’s uncompromising dissent—the

commission’s proposals were withdrawn and have not been reintroduced. Critiques appear to have been aimed at the federalization of mass torts and the “intrusion on state

sovereignty” embodied in proposals that would permit consolidation of mass torts cases

in federal courts.497 Although the critiques apparently focused on legislation introduced

in Congress, the targeted bill—though it addressed only single incident mass torts—had

features similar to the ABA Commission proposal.

Academic critiques of the ABA Commission proposals paralleled and perhaps gave

voice to the concerns raised by the ABA delegates. Professors Robert Sedler and Aaron

Twerski argued that the commission’s quest for litigation efficiency “cannot be achieved

in our federal system . . . without doing serious violence to long-standing principles of

state sovereignty and progressive trends in choice of law.”498 While acknowledging that

Congress has the power under the commerce clause to adopt federal rules governing mass

torts,499 they maintain that the proposals would sacrifice state sovereignty over mass torts

law in exchange for removing so-called inefficiencies and inconsistencies. Those inconsistencies exist, in their view, “because different states, in the exercise of their traditional

sovereignty, have adopted different substantive rules in the products liability area.”500 Proponents of consolidation “should bear a heavy burden of showing that these ‘inefficiencies’ are so serious and place such a severe strain on judicial resources as to justify removing these cases from the state courts and consolidating them in a single federal action.”501

In a broad critique of an earlier, but not materially different, draft of the ALI proposal,

Professor Richard Epstein attacks the core of the proposal, raising issues about whether

497. Supra note 486.

498. Robert A. Sedler & Aaron D. Twerski, The Case Against All Encompassing Federal Mass Tort Legislation: Sacrifice Without Gain, 73 Marq. L. Rev. 76, 76–77 (1989). The authors indicate that the article was

supported in part by a grant from Lawyers for Civil Justice, which is a defense-oriented interest group.

499. See id. at 82–87. Indeed, one of the authors supports federal products liability legislation that imposes federal solutions “specifically targeted to resolve certain problems.” Id. at 86 (citing Twerski, A Moderate

and Restrained Federal Product Liability Bill, Targeting the Crisis Areas for Resolution, 18 U. Mich. J.L. Ref. 575

(1985)). In this proposed federal legislation, selected elements of tort law would be federalized, but state law

would govern all other issues. The mix of federal and state law elements would not advance the search for a

single products liability standard in mass tort contexts.

500. Sedler & Twerski, supra note 498, at 96–97.

501. Id. at 95. In a later article, Professor Sedler voiced similar criticisms of the ALI proposals. See section

II.B.8.
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the proposals would increase fairness, efficiency, or consistency.502 He asserts that the ALI

proposal overstates savings through efficiency and understates the cost of administering

a complex consolidation.503 The search for consistency ignores the real differences among

cases and individuals as well as the differences related to our longstanding commitment

to state experimentation and federalism.504 Mostly, though, Epstein focuses on the perceived unfairness of taking away control of cases from individual litigants and amassing

claims to the point that defendants become risk-averse.505

Professor Mullenix has labeled the ALI proposals an “unfinished symphony.”506 She

critiqued the proposal related to federal jurisdiction for mass torts because it does not

directly grant federal jurisdiction to mass torts claims, but does so only indirectly through

the removal process.507 She contends that the proposal “fails to address whether a statebased case must also initially satisfy traditional federal subject matter jurisdictional requirements before the case may be removed.”508 Much of Mullenix’s critique of the ALI

proposal centers on the choice-of-law questions.

8. Choice-of-law issues

At the core of the comprehensive proposals is the quest for a single source of applicable

law. Unless one adopts the federal substantive law approach, which Professor Cooper

posits as the “neatest solution,” the burden of finding a single legal standard rests on

choice-of-law rules. The issue emerges from the tension between the desire to have a

single law and the stark differences among state laws. Having a single law promotes consistent results in cases that arise out of a defendant’s single course of conduct in designing

and distributing a mass product. Yet, various states have adopted dramatically different

and often conflicting products liability laws.509 For example, five states do not recognize a

cause of action for strict products liability.510 Other states apply a diverse set of rules to

govern jury determinations of whether a product is defective or unreasonably dangerous,

502. Richard A. Epstein, The Consolidation of Complex Litigation: A Critical Evaluation of the ALI Proposal, 10 J.L. & Com. 1 (1990).

503. Id. at 14–20.

504. See id. at 20–23.

505. Id. at 5–14.

506. Linda S. Mullenix, Unfinished Symphony: The Complex Litigation Project Rests, 54 La. L. Rev. 977

(1994).

507. Id. at 981–82.

508. Id. at 983.

509. See generally Zabel & Eyres, supra note 50.

510. See id. at 436.
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including different rules relating to admissibility of evidence, burden of proof, and underlying tests of defectiveness or unreasonable danger. Most, if not all, states have different jury instructions.511

Choosing a single law in litigation dispersed among all or most of the states could

easily result in imposing liability that the state courts or legislature have chosen not to

impose, or avoiding liability that the state has chosen to impose. Professor Larry Kramer

argues that choice-of-law issues are not procedural, but substantive. In his words, choice

of law is “as substantive as it gets.”512 “Choice of law defines the parties’ rights. States differ

about what those rights should be. . . . It follows that there is nothing ‘unfair’ if victims of

the same mass tort are compensated differently.”513 Other means of consolidating can be

found, Kramer asserts, without altering the parties’ substantive rights.

Professors Sedler and Twerski argue that constitutional barriers forbid the choice of a

single law as the basis for resolving consolidated cases in which the state whose law is

chosen does not have a direct policy interest in the dispute or “sufficient factual contacts

with the underlying transaction.”514 Case law narrows the constitutional limits within

which a court can adopt a single state’s law.515 To comply with those limits, “[a]s a practical matter, in the vast majority of cases, the court will be forced to choose either the

totally discredited ‘law of the place of the wrong’ rule or an equally rigid rule of ‘law of the

place of conduct.’”516

In mass torts settings, the only jurisdiction with an interest that could be recognized

as applicable to a group of plaintiffs from multiple states will be the law of the place of

conduct, generally the home state of the manufacturer.517 The effect will be to disadvantage plaintiffs from states with more favorable rules, or, possibly, to advantage plaintiffs

from states with less favorable rules. A long-term effect might be for manufacturers of

mass products to locate in states with products liability rules favorable to them.

More specifically, Professor Sedler maintains that the ALI proposals are not likely to

lead to the application of a single state’s law in dispersed mass torts cases involving multiple defendants. Even in cases involving a single defendant, ALI’s proposed rules of thumb

511. See id. at 436–47.

512. Kramer, supra note 152, at 569.

513. Id. at 579.

514. Sedler & Twerski, supra note 498, at 100.

515. Id. at 99-100, citing Philips Petroleum v. Shutts, 472 U.S. 797 (1985), and Allstate Ins. Co. v. Hague,

449 U.S. 302 (1981).

516. Id. at 99.

517. See Robert A. Sedler, The Complex Litigation Project’s Proposal for Federally-Mandated Choice of Law

in Mass Torts Cases: Another Assault on State Sovereignty, 54 La. L. Rev. 1085, 1100–02 (1994).
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(“tie-breakers”) would not yield a single applicable law because all plaintiffs and defendants are not likely to reside in the same state. Nor is it likely that all plaintiffs will reside

in the same state, that all injuries will take place in the same state, or that possible state

laws will not be in conflict.518

In the mass torts scenario, the ALI rules are likely to point to the law of the place where

the conduct leading to the injuries occurred. Typically, the only constitutional possibility

is the law of the place of manufacture (assuming that there is a single place of manufacture or other relevant conduct that can be identified). Most plaintiffs will lose the benefit

of the law of their home state or of the place of injury.519 Other commentators analyze the

ALI choice-of-law proposal in similar terms.520

Sedler concludes that “the transferee court should be required to apply the conflicts

law of the state from which the case has been transferred.”521 He cites the current MDL

practice in support of his position.

Professor Mullenix engages in a similar choice-of-law analysis and also concludes that

the ALI proposal is unlikely to lead to a satisfactory application of the law of a single

jurisdiction. Her recommendation, however, is at the opposite end of the state-federal

spectrum.

Professor Mullenix asserts that “the intricate interrelationship of state tort law enmeshed in mass tort cases beckons for comprehensive treatment.”522 That comprehensive

518. See id. at 1104–05.

519. See id. at 1107–08.

520. See, e.g., Fred I. Williams, The Complex Litigation Project’s Choice of Law Rules for Mass Torts and How

to Escape Them, 1995 B.Y.U. L. Rev. 1081 (mechanical uniformity in the ALI rules has the potential for causing unfair results but the escape hatch of allowing for subgroups of claims with similar state laws may ameliorate potential unfairness); Epstein, supra note 502, at 23–29. Professor Epstein points out the difficulty in

apply a conduct test because “each individual’s conduct could take place in multiple jurisdictions” and because “there is no self-defining and self-identifying conduct that caused the injury.” Id. at 26–27. Thus, courts

would have to conduct a trial to determine the conduct that caused the injury before deciding the choice of

law issue. Similar analyses would be required to determine the place of injury. Id. at 27.

521. Sedler, supra note 517, at 1110.

522. Mullenix, supra note 506, at 989. Professor Mullenix has elaborated her view on the need for substantive mass tort law revisions in several articles. Linda S. Mullenix, Class Resolution of the Mass-Tort Case: A

Proposed Federal Procedure Act, 64 Tex. L. Rev. 1039, 1077–79 (1986) [hereinafter Mullenix, Class Resolution]

(calling for authorization for federal courts to create a federal common law for mass torts or for enactment of

federal statutory provisions on mass tort liability and damages). See also Pamela M. Madas, Note, To Settlement Classes and Beyond: A Primer on Proposed Methods for Federalizing Mass Tort Litigation, 28 Seton Hall L.

Rev. 540, 562 (1997) (Enactment of a federal choice of law rule is a “back door” method for creating federal

mass tort law; the better approach might be to create federal mass tort law by statute).
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523. See Linda S. Mullenix, Federalizing Choice of Law for Mass Tort Litigation, 70 Tex. L. Rev. 1623, 1640–

45 (1992).

524. See id. at 1644–45.

525. Discussing various proposals for federal changes in substantive products liability or other tort laws

will be limited to the proposals addressed in the next section. Epstein observes that “there are plenty of areas

in which the development of a uniform federal rule would be quite welcome,” citing the issue of the effect of

compliance with federal standards. Epstein, supra note 502, at 31–32. For an example of a call for federal

substantive law to govern mass torts, including adoption of federal products liability statutes and federal

products standards, see Alvin B. Rubin, Mass Torts and Litigation Disasters, 20 Ga. L. Rev. 429, 444–45 (1986).

526. Linda S. Mullenix, Mass Tort Litigation and the Dilemma of Federalization, 44 DePaul L. Rev. 755

(1995) [hereinafter Mullenix, Federalization]; see also Mullenix, Class Resolution, supra note 522, at 1089–90;

Mullenix, Unfinished Symphony, supra note 506, at 999–1000.

treatment would entail enacting federal substantive mass torts law or at least authorizing

the development of federal common law. Her critique of the ALI choice-of-law proposals

leads inexorably to this conclusion. In her view, the principles embodied in the ALI choiceof-law schema would not lead to the choice of any single law that could be applied to

dispersed mass torts because the conduct, place of injury, and state law interests are spread

across multiple state borders.523

The ALI reporters recognize this problem and call for subgroups of claims, issues, or

parties, or for remanding cases to the transferor courts for individual treatment under

the laws normally applicable in those courts.524 Clearly, the ALI proposal does not resolve

the choice-of-law problems for cases like asbestos, DES, and silicone gel breast implants.

Professor Mullenix’s point seems well taken. The only possible source of a single law

would seem to be federal substantive law.

In sum, the most detailed choice-of-law proposals seem likely to fail to find a single

applicable law for dispersed mass torts. Commentators—and the ALI reporters—seem to

agree on that much. Proposed remedies differ immensely: to create and consolidate subgroups of case with similar laws or to enact a system of federal statutory or common law

rules governing mass torts.525 Choosing among these polar opposite proposals depends

on the values one places on state sovereignty in the mass torts field as compared to the

values one places on efficiency and consistency of results.

9. Other legislative proposals

a. Federal substantive law

As Professor Cooper has noted, changing federal substantive law provides the “neatest

solution” to the need for a single applicable law. Professor Mullenix has advocated consistently, in a number of contexts, for adoption of federal legislation to govern mass torts.526
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Her core rationale is that the parties have chosen to bring most of their mass torts to

federal courts, there are defects in all of the federal procedural tools for addressing mass

torts, and federalization of the substantive law governing mass torts is the only practical

way to address the problems comprehensively.527

In the course of her analysis, Professor Mullenix addresses what she considers to be

strong counterarguments against federalization, especially those presented by Professor

Mark Weber.528 In the course of presenting Weber’s rationale for favoring state adjudication of mass torts, Mullenix observes that he frequently calls for federal legislation to

enhance the ability of the states to handle mass torts, including creating uniform choice

of law rules, nationwide service of process, and approving proposed interstate compacts.529

This selective federalization mirrors current legislative efforts to federalize selected aspects of products liability standards while leaving other aspects to the states. This approach is discussed in the next section. For handling mass torts litigation, such approaches

seem to aggravate a preexisting problem.

Mullenix and Cooper do not set forth specific proposals for federal substantive law.

Either federal products liability statutes or federal authorization for courts to develop

federal common law would be needed. Other commentators have called for federal statutes to deal with specific aspects of mass torts liability, including altering the standards

for proving general causation and punitive damages, which we discuss below.

b. Federal substantive law: products liability reform

Generally, the substance of the law to be applied by the federal judiciary would not be

a matter of concern to a judicial policy-making body like the Mass Torts Working Group.

In the mass torts area, however, concerns may be different. The case for a single federal

law governing mass torts has been made in discussing the almost-intractable morass that

applying state choice-of-law rules poses for the judiciary. In this section and the next, we

outline two current proposals that could provide the content of federal law, one that

would federalize products liability law and one that would alter the causation component

of mass torts liability.

We address the first approach because there has been a persistent effort for more almost two decades to federalize products liability law in ways that have not been attentive

to resolving mass torts problems. The judiciary’s interest may be in not missing an op527. See Mullenix, Federalization, supra note 526, at 786–91.

528. See Mark C. Weber, Complex Litigation and the State Courts: Constitutional and Practical Advantages

of the State Forum Over the Federal Forum in Mass Tort Cases, 21 Hastings Const. L.Q. 215 (1994).

529. See Mullenix, Federalization, supra note 526, at 778–79.
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portunity to create a single federal law and improve the ability of courts to manage mass

torts litigation—or at least avoid the possibility of making mass torts case management

even more complex.

We address the second approach in the next section. Despite its substantive content,

we discuss it because its premise is that by changing the incentives for testing the safety of

products, substantive law can prevent mass torts and can simplify standards of proof for

those mass torts that pass through the safety-testing net. Clearly the federal judiciary has

a policy interest in substantive laws that promise such a direct impact on the federal civil

caseload.

In March 1996, Congress passed the Common Sense Product Liability Legal Reform

Act of 1996, which President Clinton vetoed.530 In 1998, a modified form of the bill that

was reportedly acceptable to the President failed to survive a motion to limit debate and

amendments.531 Given that proposals to enact federal products liability legislation have

been presented regularly since 1979, continuing activity can be expected.532

For our purposes, the most important fact about recent efforts to enact federal products liability legislation is that they have not attempted to create a single federal law that

would govern all elements of products liability causes of action. Proponents of federal

legislation “do not advocate a complete federal ‘takeover’ of product liability law.”533 Instead, they focus on “a few core areas”534 such as the liability of wholesale and retail product sellers,535 creating defenses when a claimant’s use of drugs or alcohol or gross misuse

of a product was the principal cause of an accident,536 establishing a preemptive two-year

statute of limitation that would run from the time the claimant discovered or should have

discovered the cause of injury,537 establishing a non-preemptive fifteen year statute of

repose (with an exception for latent injuries),538 and establishing evidentiary and liability

standards, bifurcation procedures, proportionality limits, and monetary caps on punitive

damages liability.539

530. See Victor E. Schwartz & Mark A. Behrens, Federal Product Liability Reform in 1997: History and

Public Policy, 64 Tenn. L. Rev. 595, 600–01 (1997).

531. See Philip Buchan, Products Liability Bill Killed in Senate, Trial, Sept. 1998, at 11.

532. See Schwartz & Behrens, supra note 530, at 599–601.

533. Id. at 604.

534. Id.

535. Id. at 607–08.

536. Id. at 609–10.

537. Id. at 610–11.

538. Id. at 611–12.

539. Id. at 613–19.
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We have not found a published analysis of the likely impact of the proposed federal

products liability litigation on mass torts. My own impressions follow. Aggregation and

choice of law seem to be the two main areas that are implicated. To a limited extent,

aggregation would be simplified under the proposed legislation because some of the targeted issues would become common issues in a proposed class action or MDL proceeding. For example, uniform federal statutes of limitations and uniform standards for punitive damages would simplify aggregated management of some dispersed mass torts. On

the other hand, areas that were omitted or not preempted, such as standards of dangerousness and statutes of repose, would continue to be resolved under various laws in various states. The federal statute of repose would add another law and further complicate

the choice of law determination. Along similar lines, choice of law problems might be

somewhat simplified in regard to statute of limitations and punitive damages issues, but

in all other areas the quest for a single applicable law would remain muddled.

Federal product liability reform efforts may present an opportunity to clarify national

products liability standards. Reforming standards nationally would fit the rationale of

proponents of reform who argue that uniform standards are needed because 70% of

products manufactured in a given state are sold elsewhere, because products liability insurance rates are set on a national level, and because competitors operate under uniform

products liability laws.540

c. Federal substantive law: wrongful creation of risk

Professors Margaret Berger and Wendy Wagner each propose changing the standards

for defining causation in mass torts settings. They start from the premise that current tort

rules do not serve the public well because they discourage long-term research on the

safety of products.

Professor Wagner reports that in “its comprehensive 1984 study, which still remains

largely up-to-date, the NRC [National Research Council of the National Academy of Sciences] found that for approximately eighty percent of the estimated 48,523 unregulated

chemicals in commerce, no toxicity information existed.”541 A RAND study found that the

organization of the corporate design and production processes often leads to failure to

research products. In the words of the RAND researchers, “in developing the design for

new or modified products, safety is everybody’s business—and, therefore, may turn out

in practice to be nobody’s business.”542

540. See id. at 601–04.

541. Wagner, supra note 27, at 782 (citing Steering Comm. on Identification of Toxic and Potentially

Toxic Chemicals for Consideration by the Nat’l Toxicology Program, National Research Council, Toxicology

Testing: Strategies to Determine Needs and Priorities 12 at figure 2, 84 at table 7, 94 at table 10, 117 at table 20

(1984)).

542. Eads & Reuter, supra note 60, at 57.
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Professor Berger reviewed published case studies of Agent Orange, asbestos, Bendectin,

breast implants, the Dalkon Shield, thalidomide, tobacco, and other substances and concluded that “a common thread runs through all these accounts. All report that the corporation in question did not test its product adequately initially, failed to impart information when potential problems emerged, and did not undertake further research in response to adverse information.”543

Under tort law, the manufacturer who has not conducted safety testing or other research commands a formidable advantage. Plaintiff has the burden of showing that it was

more probable than not that a particular product or substance caused plaintiff’s injuries.

“‘In mass tort cases, the importance of the science cannot be overemphasized. Without in

vitro [tests on single cells], in vivo [tests on animals] and epidemiological findings, and

experts prepared to present them, the plaintiff has no case.’”544

Legal rules not only offer manufacturers “practical immunity for remaining ignorant

about the latent hazards of their products and byproducts, [but] the courts provide, at

best, unreliable rewards [in the form of a “state-of-the-art” defense recognized in some

jurisdictions] for manufacturers who institute comprehensive safety testing programs.”545

Empirical evidence from case studies of Bendectin and benzene shows that “a single positive or inconclusive epidemiology study appeared to lead to plaintiffs’ verdicts and increased filings.”546

Professor Wagner proposes changes in the tort law that would reverse the incentive

structure in two ways: by creating a cause of action against a manufacturer for negligent

failure to test a product’s safety and by creating a defense for the manufacture who has

tested a product before marketing it.

The new cause of action would work this way: “The plaintiff thus establishes a prima

facie case with proof of the following: (1) inadequate minimal testing of a product, (2)

normal or foreseeable exposure to the product, and (3) serious harm that might be causally linked to exposure to the product . . . The defendant then bears the burden of rebutting this presumption of causation.”547 The manufacturer could use post-marketing testing to meet this burden.

543. Berger, supra note 27, at 2135.

544. Wagner, supra note 27, at 793 (citing Joseph Sanders, The Bendectin Litigation: A Case Study in the

Life Cycle of Mass Torts, 43 Hastings L.J. 301, 331 (1992)).

545. Id. at 794.

546. Id. at 817–18.

547. Id. at 834–36.
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The second prong of the proposed reform is designed to reward testing. “Successful

completion of a battery of tests sufficient to fully assess the health hazards a chemical

poses would provide the manufacturer with a state-of-the-art defense.”548 A rationale for

that prong is that “corporations that do their best in light of the uncertainties that abound

in a technological society on the verge of the twenty-first century deserve to be relieved of

liability.”549

In short, the Wagner-Berger proposals would penalize manufacturers who fail to test

products that might cause injuries and would reward manufacturers who conduct minimal safety testing. Their proposals seem to warrant serious consideration as measures

that might prevent the proliferation of mass torts litigation.

Professor David Bernstein, a critic of how the tort system handles scientific issues,

agrees that the “absence of a remedy for behavior that puts thousands of people at risk is

particularly troubling . . . because the current tort regime, in requiring proof of causation,

not only fails to provide sufficient incentives for manufacturers to test the safety of their

products, [it] may even discourage them from doing so.”550 He concludes, however, that

the Wagner-Berger proposal is “not an appropriate response to the problem of corporate

misbehavior” because “a single state class-action verdict could easily bankrupt any defendant in a mass tort case, as the defendant would be potentially responsible for every claimed

injury suffered by any plaintiff who was exposed to the relevant toxic substance.”551

Bernstein addresses the problem of lack of incentives to test products by proposing

“federal legislation, akin to whistle-blower statutes and qui tam provisions, that would

permit individuals to bring an action in a federal tribunal against a company that is negligently putting the health of the public at risk.”552 Such a system would “give thousands

of individuals with dispersed knowledge a financial incentive to monitor and challenge

corporate misbehavior as it is occurring.”553

The Wagner-Berger and Bernstein proposals are fascinating in that analysts with very

different perspectives on the civil justice system agree that it fails to address major public

safety concerns. Whether one proposal or another—or even a third—takes hold, there

548. Id. at 838.

549. Berger, supra note 27, at 2148.

550. David E. Bernstein, The Breast Implant Fiasco, Calif. L. Rev. (forthcoming) at 63 (available on the

Internet at www.ssrn.com/papers/9807/98071302.pdf).

551. Id. at 64.

552. Id. at 66.

553. Id. at 67.
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554. See generally Nagareda, supra note 28 (analyzing the phenomenon of corporate misconduct that

puts the public at risk but, through no vigilance of the perpetrator, fortunately does not cause serious harm).

555. See discussion supra notes 530–39.

556. Kimberly A. Pace, Recalibrating the Scales of Justice Through Rational Punitive Damage Reform, 46

Am. U. L. Rev. 1573, 1613–14 (1997).

557. Stephan Landsman et al., Be Careful What You Wish For: The Paradoxical Effects of Bifurcating Claims

for Punitive Damages, 1998 Wisc. L. Rev. 297, 329.

558. Id.

559. Id. at 330.

may be common ground for concluding that the problem of safety research is at the core

of mass torts problems.554

d. Federal substantive law: punitive damages

As we have seen, the proposed Common Sense Product Liability Legal Reform Act

[“Federal Reform Act”] and its progeny included punitive damages provisions that would

have altered the standards for punitive damage awards, impose caps, set proportionality

limits, and required bifurcated proceedings for assessing punitive damages.555 Specifically, the Act would have required that a defendant’s conduct exhibit “a conscious, flagrant indifference to the rights or safety of others,” raised the burden of proof to “clear

and convincing evidence,” imposed a monetary cap of $250,000 or twice the compensatory damages awarded, and permit either party to have a trial on punitive damages bifurcated from the trial on liability and compensatory damages.556

Recent empirical evidence on separating (“bifurcating”) punitive damages issues from

decisions on liability and compensatory damages suggests that the effects may not be as

straightforward as proponents expect. Using experimental social science methods, researchers found, not surprisingly, that “a bifurcated trial affords the defendant a better

chance of prevailing on the issue of compensatory liability than a unitary trial does (a

60% probability of winning versus a 43% probability [in the simulated trial used in the

experiment].”557 For those defendants who lose the liability issue and have to face a hearing on punitive damages, they are more likely to lose on punitive damages (90% versus

76%) and to face higher awards when they lose. Taking into account all possible outcomes (win/loss on liability, win/loss on punitive damages, and size of awards), researchers calculated that overall “a defendant’s expected loss is greater in a bifurcated trial

($641,487 versus $569,677).”558 On the other hand, bifurcating trials improved jurors’

ability to identify the considerations appropriate for an award of punitive damages, but

had no effect on comprehension of evidence or other instructions.559 These data raise

questions about whether the bifurcation aspect of proposed reforms is worth the candle.
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The premises for federal punitive damages reform are that it is “necessary to safeguard

against undeserved and excessive awards and to protect the defendant, the public, and the

integrity of the judicial process.”560 Empirical evidence, however, gathered in nine separate studies by entities such as the American Bar Foundation, RAND’s Institute for Civil

Justice, the United States General Accounting Office, and a number of academic researchers

cast doubt on the factual basis for the underlying rationale. A summary of those studies

concludes: “The convergence of research findings is that overall [the] rate and level of

punitive damages awards is low.”561

Rates of punitive damages awards are considerably lower in products liability cases

than in contracts and business tort cases. A Department of Justice study found rates of

2% for products liability cases, 6% for toxic tort cases, 12% for all contract cases, and 21%

for fraud cases; other studies uncovered similar results.562 Amounts of punitive damages

awards are closely correlated with severity of injury and amounts of compensatory damages awarded.563 Indeed, proponents of the proposed federal reform cite one of the studies for the proposition that “awards in product liability punitive damages cases, after all

appeals were exhausted, have almost always been within the two times compensatory

[damages] limit proposed in the Conference Report.”564 Researchers also found that there

is “extensive judicial oversight over the remedy of punitive damages.”565

One empirical conclusion does, however, provide a basis for considering federal punitive damages legislation: “Every empirical study on trends of punitive damages finds substantial variation within and between jurisdictions.”566 One study found that fifty of ninetyfive asbestos punitive verdicts were assessed by southern juries and that southern juries

accounted for more that 50% of all punitive awards.567 The six states with the highest

number of awards were, in descending order of magnitude, Texas, California, Florida,

Illinois, Missouri, and Alabama.568

560. Pace, supra note 556, at 1615.

561. Michael L. Rustad, Unraveling Punitive Damages: Current Data and Further Inquiry, 1998 Wisc. L.

Rev. 15, 20.

562. Id. at 24–28.

563. Id. at 31.

564. Schwartz & Behrens, supra note 530, at 618.

565. Rustad, supra note 561, at 40–44.

566. Id. at 33.

567. Id. at 34 (citing Michael Rustad, Demystifying Punitive Damages in Products Liability Cases: A

Survey of a Quarter Century of Trial Verdicts 25 (Lee Hays Romano ed., 1991)). To get an exact idea of how

disproportionate those figures are, one would want to know the proportion of asbestos litigation civil litigation that takes places in southern courts.

568. Id.
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One area of uncertainty clouds the question of whether punitive damages reform is

necessary. Proponents of punitive damages reform argue that despite the low incidence,

punitive damages have a wide impact because concerns about the possibility of a huge

award affect settlements. Empirical data on point are sketchy and better data have been

very difficult to uncover.569 One commentator, after reviewing existing studies, concludes

that “[m]ass torts provide the clearest example of settlement leverage produced by punitive damages.”570 This same author also concludes that the “rarity and predictability of

punitive damages verdicts and the difficulty of collecting them post-trial suggest that the

fears of the business community are exaggerated. Ironically, the leverage produced by a

potential punitive damages award is increased by the belief that the remedy is out of

control.”571 Even if punitive damages are shown to cast a long shadow in mass torts cases,

the same features of a case that might make punitive damages likely—reckless or otherwise outrageous misconduct by a defendant—might also drive high compensatory awards

and settlements even if punitive damages were to be capped or reduced to a single judgment.

A key element of the Federal Reform Act is its cap on punitive damages. Proponents of

the cap argue that it is necessary to make the punishment proportional to the harm.572

Opponents stress that a cap may result in inadequate deterrence of wrongdoers “who

have been found, by clear and convincing evidence, to have intentionally sacrificed public

safety for corporate profits.”573 Moreover, opponents assert that a cap tied to compensatory damages discriminates against women and minorities who are more likely than males

or majorities to receive lower awards because their incomes are generally lower.574 Such

limits have no relation to factors such as the severity of injury inflicted by defendant’s

conduct; a defendant may benefit from what has been called the “outrageous fortune” of

unintentionally doing less harm than the conduct might have been expected to cause.575

One critic of economic caps on punitive damages calls instead for adopting the Model

Punitive Damages Act [Model Act] provisions. The Model Act would direct juries to limit

569. See Herbert M. Kritzer & Frances Kahn Zemans, The Shadow of Punitives: An Unsuccessful Effort To

Bring It Into View, 1998 Wisc. L. Rev. 157.

570. Thomas Koenig, The Shadow Effect of Punitive Damages on Settlements, 1997 Wisc. L. Rev. 169, 208.

571. Id.

572. See Schwartz & Behrens, supra note 530, at 617–18.

573. Pace, supra note 556, at 1638.

574. See id. at 1630–31.

575. See Nagareda, supra note 28, at 1121.
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their consideration of punitive damages to enumerated factors such as the nature and

effects of defendant’s conduct, profits, present and future financial condition, and any

penalties, damages, or restitution paid arising from the same conduct.576 The Model Act

would also authorize courts to reduce awards that duplicate prior awards.577

Other proposed reforms address the possibility that courts will award multiple punitive damages for the same or similar conduct in a mass torts setting. Some contend that a

single proceeding in the nature of a class action or interpleader could define a res and

authorize an injunction against overlapping proceedings in state courts on the theory

that such an injunction would be necessary to protect the court’s jurisdiction.578 Appellate cases in the mass torts context have expressly rejected that theory.579

Given these precedents, legislation would appear to be needed to accomplish any change

in the practice of permitting multiple awards. Some states have enacted legislation to

limit the number of punitive damages awards, but such statutes have been judged ineffective because states cannot control what courts in other states might do.580

Judge William Schwarzer, in testimony to Congress, emphasized that the availability

of multiple punitive damage awards affects the settlement dynamics in all asbestos cases

and that early awards of punitive damages diminish funds that might otherwise be available for later claimants.581 He outlined four alternative statutory approaches that could

be taken under the commerce power to address the problem: (1) establish federal stan576. See Pace, supra note 556, at 1632–34.

577. See id. at 1633.

578. See Bryan J. Schillinger, Preventing Duplicative Mass Tort Litigation Through the Limited Resources

Doctrine, 14 Rev. Litig. 465, 476–81 (1995).

579. See Richard A. Seltzer, Punitive Damages in Mass Tort Litigation: Addressing the Problems of Fairness,

Efficiency and Control, 52 Fordham L. Rev. 37, 41–42 (1983) (citing In re Federal Skywalk Cases, 93 F.R.D. 415,

419 (W.D. Mo.), vacated, 680 F.2d 1175 (8th Cir.), cert. denied, 103 S. Ct. 342 (1982), and In re Northern Dist.

of Cal. “Dalkon Shield” IUD Prods. Liab. Litig., 526 F. Supp. 887, 897 (N.D. Cal. 1981), vacated, 693 F.2d 847

(9th Cir. 1982), cert. denied, 103 S. Ct. 817 (1983)).

580. See Jerry J. Phillips, Multiple Punitive Damage Awards, 39 Vill. L. Rev. 433, 442–43 (1994). Along

similar lines, a majority of the en banc U.S. Court of Appeals for the Third Circuit concluded that serious

problems with multiple punitive damage awards in asbestos litigation were beyond the power of any single

jurisdiction to cure. Dunn v. Hovic, 1 Fed. 3d 1371 (3d Cir.), modified in part, 13 F.3d 58 (3d Cir.), cert. denied

sub nom. Owens-Corning Fiberglas Corp. v. Dunn, 111 S. Ct. 650 (1993); see generally Gary T. Schwartz, Mass

Torts and Punitive Damages: A Comment, 39 Vill. L. Rev. 415 (1994) (discussing multiple punitive damages in

relation to deterrence policies and addressing limitations on approaches for courts to control multiple awards).

581. Schwarzer, Asbestos Testimony, supra note 19, at 137–38, 140.
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dards for punitive damages, bar any state awards, provide for a single court proceeding to

determine the single award, and permit intervention by plaintiffs with pending cases;582

(2) a statutory amendment of Rule 23 to provide for a nationwide mandatory class action, to designate the court to hear the proceeding, and to specify either the federal substantive law or a federal choice of law rule to be applied;583 (3) a variation of the federal

interpleader statute in which one court would have jurisdiction to resolve all punitive

damages claims in federal and state courts and to enjoin enforcement of any other punitive damage awards;584 and (4) aggregating all federal cases under an amended multidistrict

litigation statute, authorizing trials in the transferee court, and providing for removal of

cases pending in state courts.585 All of the options would require creating either a substantive federal law of punitive damages or a federal rule for choosing a single law.

e. Federal jurisdictional statutes

At least two commentators have noted that the ALI proposal does not include changes

in federal subject matter jurisdiction to support consolidation of cases.586 That appears

to have been a conscious decision. The ABA and Cooper proposals, of course, include

changes in federal subject matter jurisdiction that would allow all mass torts cases to be

consolidated in a single federal court.

Before we examine specific jurisdictional proposals, we should consider the relationship between jurisdictional changes and other procedural and substantive rules. Jurisdictional changes, of course, do not and probably should not occur in a vacuum. In enacting

the federal interpleader statute, for example, Congress also addressed companion issues

to creating that joinder device. Those issues included establishing subject matter jurisdiction (changing federal question, diversity, supplemental, and removal jurisdiction are the

existing options), appellate jurisdiction, venue, personal jurisdiction (providing for nationwide service of process), and authorizing injunctions against state proceedings.587

Substance-specific matters relating to mass torts jurisprudence, such as standards for liability and punitive damages, would naturally arise,588 as would issues relating to

582. Id. at 144–46.

583. Id. at 146–49.

584. Id. at 149–51.

585. Id. at 151–52.

586. See Mullenix, Unfinished Symphony, supra note 506, at 981–84; Epstein, supra note 502, at 33–49;

Rowe, supra note 486, at 345–47.

587. Thomas D. Rowe, Jr., Beyond the Class Action Rule: An Inventory of Statutory Possibilities to Improve

the Federal Class Action, 71 N.Y.U. L. Rev. 186 (1996).

588. Cf. id. at 205–06.
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multidistrict litigation, choice of law, and relationships with current procedural rules

(e.g., class actions) and current case-management practices (e.g., consolidation, extrapolation).589 Detailed analysis of these relationships is beyond the scope of this review, but

hopefully this brief summary will serve as a checklist of areas in which changes may be

needed in legislation extending federal jurisdiction over mass torts. Without considering

whether to include provisions relating to such issues, unintended consequences might

result from attempts to alter subject matter jurisdiction.

More than a decade ago, Professor Thomas Rowe and Kenneth Sibley set forth a proposal to establish federal jurisdiction for mass torts and other multiparty, multiforum

cases.590 Rowe and Sibley focused their attention on “scattered” or dispersed litigation,

that is “situations in which the multistate nature of the federal union prevents the states

from responding adequately to the problem of scattered litigation.”591 While one of their

primary examples was the Hyatt Skywalk litigation, their proposal encompasses most

mass torts litigation and seems especially applicable to the current fen/Phen/redux litigation now proceeding in state and federal courts.

Rowe and Sibley’s proposal would extend federal jurisdiction to multiparty, multiforum

cases, using the mechanism of minimal diversity of citizenship once certain conditions

were met. Their unique key to invoking this jurisdiction would be “whether any defendant has a residence in a state other than the one in which a substantial part of the acts or

omissions giving rise to the action occurred.”592 This unique factor distinguishes cases

that might benefit from consolidation from all others.

Recognizing that changing federal jurisdiction would not, by itself, resolve problems

with dispersed mass torts, Rowe and Sibley’s proposal includes features dealing with choice

of law, removal jurisdiction, multidistrict transfers, personal jurisdiction, service of process, venue, and joinder. The proposed Multiparty, Multiforum Jurisdiction Act of 1990,593

589. See generally Mullenix, Unfinished Symphony, supra note 506.

590. See Thomas D. Rowe, Jr. & Kenneth D. Sibley, Beyond Diversity: Federal Multiparty, Multiforum

Jurisdiction, 135 U. Pa. L. Rev. 7 (1986).

591. Id. at 23. Rowe and Sibley underscore the limits of current jurisdictional devices. The complete

diversity rule operates as a major barrier to multiparty cases, often limiting federal jurisdiction to single

plaintiff, single defendant cases. See id. at 19–20. Requiring each class member to satisfy the jurisdictional

amount in controversy also limits the availability of class actions to draw together dispersed cases. Id. at 20–

21. Statutory interpleader has been “confined to the exigencies of the stakeholder situation, involving the

threat of multiple and inconsistent liability, for which it was framed.” Id. at 22.

592. Id. at 26.

593. H.R. 3406, 101st Cong., 2d Sess. (1990). For a discussion of the bill, see Rowe, supra note 486, at 337–

41.
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which was being debated at the time of the ALI proposals, would have created new federal

subject matter jurisdiction, based on minimal diversity of citizenship, for a defined group

of single-event accidents with multistate implications (at least twenty-five deaths or injuries in which damages exceeded $50,000). The bill passed in the House of Representatives, but did not reach a vote in the Senate.594

The considerable efforts of supporters to marshal a consensus in support of that legislation are documented by Charles Geyh, who was then counsel to the subcommittee in

which the bill originated.595 Professor Geyh concluded that “proceeding by consensus

and compromise may be pivotal to the success of mass-torts legislation in both the House

and Senate, but achieving consensus and compromise in legislation passed by one body

of Congress provides no guarantee that the other body will process the legislation.”596

Professor Mullenix argues that attempts to alter federal subject matter jurisdiction by

using the minimal diversity approach or by expanding removal jurisdiction are of doubtful constitutional validity.597 While she concludes that expanding diversity jurisdiction is

constitutionally defensible, she predicts that those who pursue the diversity track “are

heading for a choice-of-law disaster” and that only federalizing substantive law, which is

“politically unacceptable,” is the only appropriate federal solution.598

f. Creating jurisdiction to issue a bill of peace

Historically, equity jurisdiction recognized an action by a defendant faced with a multiplicity of litigation about single events such as mine disasters, water rights issues, and

noxious omissions.599 A defendant could take the initiative in seeking a binding resolution of common issues, and, if certain conceptual hurdles were surmounted, the court

could enjoin relitigation of those issues.600

594. See Rowe, supra note 486, at 329. An earlier version had a similar outcome. Id.

595. See generally Charles Gardner Geyh, Complex Litigation Reform and the Legislative Process, 10 Rev.

Litig. 401 (1991).

596. Id. at 416.

597. See Linda S. Mullenix, Complex Litigation Reform and Article III Jurisdiction, 59 Fordham L Rev. 169,

196–211 (1990).

598. Id. at 224.

599. See Thomas D. Rowe, Jr., A Distant Mirror: The Bill of Peace in Early American Mass Torts and Its

Implications for Modern Class Actions, 39 Ariz. L. Rev. 711, 712–13 (1997); see also Stephen C. Yeazell, The Past

and Future of Defendant and Settlement Classes in Collective Litigation, 39 Ariz L. Rev. 687 (1997) (tracing the

history of defendant-initiated class action litigation).

600. See Rowe, supra note 599, at 718.
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Professors Paul Carrington, Roger Cramton, and Jeffrey O’Connell have resurrected

the concept of an equitable bill of peace and proposed the outline of a statute to implement their concept.601 Their proposal centers on creating a mechanism that any party to

multiple litigation can use to obtain a definitive ruling on a recurring scientific or technical issue. Venue would be in the United States Court of Appeals for the Federal Circuit,

which could appoint a district judge to receive evidence. Apparently, a panel of the court

of appeals would then determine the issue and be expected to explain the scientific or

technical basis for its determination.602 The court could appoint technical experts to assist it. Review would be by the Federal Circuit en banc or by certiorari to the Supreme

Court, but not to reconsider the scientific or technical merits of a determination. The

panel could enjoin relitigation of claims in any court.603

Because the proposal is new and creative, there is no direct commentary in the literature about it. The proposal’s approach, which is to bar relitigation of similar claims, uses

issue preclusion as its core mechanism. Issue preclusion has been attempted in asbestos

litigation with little or no success.604 Professor Michael Green carefully studied the attempts to apply collateral estoppel to asbestos litigation and concluded that “collateral

estoppel has little potential to make a significant contribution in resolving judicial administration difficulties engendered by asbestos litigation.”605

One of the reasons for this harsh judgment is that collateral estoppel—like the bill of

peace—operates only on a single issue in mass torts litigation, typically whether a product has the general capacity to cause the type of injury alleged. If the answer is positive, as

in asbestos litigation, only one of many issues is covered and its application to any individual plaintiff can be disputed. If the answer is negative, general causation may be a

dispositive issue, but its application still might generate case-by-case litigation. For example, individuals with different injuries or different levels of exposure may argue for an

opportunity to present their own scientific experts to testify as to what caused their specific injuries. Even if some attempts to relitigate are unsuccessful, the attempts themselves

consume judicial and party resources.

601. Paul D. Carrington et al., A Proceeding in the Nature of a Bill of Peace to Determine Scientific or

Technical Issues Recurring in Civil Litigation (1998) (unpublished manuscript on file with the Information

Services Office of the Federal Judicial Center).

602. See id. at 8.

603. See id. at 7.

604. See Trends, supra note 49, at 101.

605. Michael Green, The Inability of Offensive Collateral Estoppel to Fulfill Its Promise: An Examination of

Estoppel in Asbestos Litigation, 70 Iowa L. Rev. 141, 224 (1984); see also James F. Flanagan, Offensive Collateral

Estoppel: Inefficiency and Foolish Consistency, 1982 Ariz. St. L.J. 45, 52–53.
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Given its novelty in relation to mass torts litigation, experimental testing of the bill of

peace approach may be needed. Practical questions remain, such as how to define the

scientific issues, when to allow a decision to be reexamined, and whether the anticipated

effects on future litigation will be achieved. Without more experience, it is difficult to

predict whether or not this proposed device has the capacity to produce the peace its

proponents seek.

g. Vaccine compensation-type program

Proposals to handle mass torts cases through administrative processes, as black lung

cases are currently handled, are beyond the scope of this report. The National Vaccine

Injury Compensation Program (NVICP), however, deserves attention because it is an

administrative remedy that operates within the judiciary. The Federal Judicial Center recently published a description and evaluation of the operation of that program.606

Congress created the NVICP to address the risk that childhood vaccines might disappear from the market because of litigation arising from adverse reactions to vaccines.607

Located in the United States Court of Federal Claims, an Article I court, the program uses

special masters to hear claims for compensation. Awards issued by special masters can be

rejected and claims pursued in federal or state courts, subject to several special statutory

defenses.608 Awards are financed by the proceeds of an excise tax on vaccine sales, while

administrative costs are paid through federal appropriations.

Innovative case-management practices facilitate individual determinations by special

masters. Such practices include “front-end loading,” a requirement that documentation

supporting claims or defenses accompany the first pleadings; exchange of written experts

early in the process; informal status conferences; bifurcation of causation and damages;

telephonic hearings; hearings focused on expert testimony; and direct examination of

expert witnesses by the special master.609

606. Molly Treadway Johnson et al., Use of Expert Testimony, Specialized Decision Makers, and CaseManagement Innovations in the National Vaccine Injury Compensation Program (Federal Judicial Center

1998).

607. See id. at 7–8.

608. See id. at 9–10. Manufacturers are not liable for the unavoidable side effects of vaccines that were

properly prepared and labeled with appropriate warnings. The statute also applies the learned intermediary

defense and creates a presumption that warnings that comply with FDA standards are adequate. See id. at 10–

11.

609. See id. at 25–39.
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A majority of attorneys found that the program was less expensive than traditional

litigation, but that it takes at least as long.610 While most attorneys were generally satisfied

with the program, a substantial minority of petitioners’ attorneys did not find the procedures to be fair,611 and a number complained specifically about procedures for handling

attorneys’ fees.612

Special masters and government lawyers thought the program could be applied to

other mass torts, such as asbestos, breast implants, and medical devices.613 While it may

be unlikely that this type of program would be adopted wholesale for mass torts, specific

innovations show more promise. Front-end loading, early exchange of expert reports,

and use of specialized decision makers are approaches that warrant consideration in mass

torts litigation.

h. Amending class action rules

Several commentators have suggested modifying the class action rules in ways that

appear to be so substantive that they are beyond the power of the Advisory Committee

under the Rules Enabling Act. Professor David Shapiro borrows a term and concept from

Professor Cooper and argues for legislation that would treat a class of mass torts claimants as an entity rather than an aggregation of individuals.614

Shapiro finds justification for such an approach in the collective aspects of mass torts

litigation. For example, proof of exposure of any given individual to a toxic substance

may be lacking, but proof of exposure of the class as a whole may present a better picture

of the alleged wrongdoing.615 Similarly, proof of individual causation may be lacking in a

situation in which it is clear that exposure to a toxic substance raised the occurrence rate

of a specific disease for the class as a whole.616 These illustrations suggest that “a mass tort

is, and should be treated as, substantively different from a one-on-one tort from the perspective of both major objectives of the tort system [compensation and deterrence], and

that such treatment would (or at least should) be recognized as desirable by the members

of the affected class.”617 In other words, treatment of the class as an entity for purposes of

610. See id. at 46–47. The authors found that “[d]elays appear to be attributable to a backlog of pre-Act

cases that is steadily being reduced.” Id. at 4.

611. See id. at 47–49.

612. See id. at 44–45.

613. See id. at 49–51.

614. Shapiro, supra note 133, at 913; see also Edward H. Cooper, Rule 23: Challenges to the Rulemaking

Process, 71 N.Y.U. L. Rev. 13, 26–32 (1996).

615. See Shapiro, supra note 133, at 930–31.

616. See id. at 931.

617. Id. at 932–33.
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the litigation produces substantive gains not attainable through individual litigation; the

collective approach is more than the sum of the individual cases.

These substantive gains are superimposed on procedural gains in terms of prompt

and less costly resolution of multiple claims, to the benefit of all parties and the courts.

Moreover, viewing the class as an entity would modify the need for notice to each individual before the entity’s claims are adjudicated; small claims certainly would need less

notice than currently required. Most importantly, it would require modifying current

rights of individuals to opt out of a class entity618—and perhaps changing the incentives

for claimants and their attorneys to do so.619

Professor John Coffee posits some specific limits that might be imposed legislatively

on attorneys representing opt-out claimants. One proposal is to limit attorneys fees in

opt-out situations to the amount by which the opt-out award exceeds the class settlement.620 Another method would be to “tax some portion of the defendants’ costs to a

plaintiffs’ attorney who failed to exceed the class action recovery.”621

To implement his proposals, Shapiro advocates legislative action that would focus on

the adequacy of representation of the class, with precise standards of accountability and

specific prohibition of defined conflicts of interest. He also advocates “[d]eveloping explicit techniques to explore both the fairness of settlements in overall terms and in terms

of distributions to be made among class members.”622 Arguably, some of his concepts

could be enacted as procedural rules under the Rules Enabling Act.

618. Another commentator approaches opt-out rights from a totally different perspective and arrives at

conclusions similar to Shapiro’s. Michael Perino uses game theory concepts to analyze the effects of opt-out

provisions on the class action mechanism. He concludes that “recognition of opt-out rights in cases where it

is feasible for litigants to exercise them [cases that can support individual litigation] can . . . destroy the

effectiveness of the class mechanism. . . . Individual autonomy may thus be fundamentally incompatible with

obtaining global resolution in mass tort and other kinds of class actions.” Michael A. Perino, Class Action

Chaos? The Theory of the Core and an Analysis of Opt-out Rights in Mass Tort Class Actions, 46 Emory L. J. 85

(1997). Discussion of Perino’s specific proposals to address this dilemma is beyond the scope of this report.

619. See Shapiro, supra note 133, at 937–38, 957–58. Shapiro suggests a modification of opt-out rights by

limiting attorneys’ fees for parties who opt out and requiring that opt-out parties contribute to common

costs of the litigation (citing David Rosenberg, Class Actions for Mass Torts: Doing Individual Justice by Collective Means, 62 Ind. L. J. 561, 594 (1987)).

620. Coffee, supra note 69, at 1452.

621. Id. at 1452–53.

622. Shapiro, supra note 133, at 959.
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Professor Coffee also proposes reforms relating to settlement class actions. He would

require that the court select counsel to negotiate for the class, perhaps requiring selection

of a broad-based representative steering committee of counsel that would have to ratify a

proposed settlement.623 In later testimony, Professor Coffee proposed that additional

democratic controls be imposed on class counsel, such as selection by a steering committee composed of class members or having class members vote on whether or not to ratify

a negotiated settlement.624 The latter suggestion seems particularly relevant to dealing

with opt-out rights in mass torts litigation, as a compromise between full autonomy and

unbridled collectivization.

Coffee also proposes that courts refuse to certify a “futures only” class and refuse to

certify a settlement class when a litigation class could not be certified.625 Alternatively,

future claims could be handled by permitting delayed opting out, only after injuries have

become manifest. Claimants would be allowed the option of accepting a scheduled amount

for their injuries or pursuing a claim in the tort system. Defendants would thus have

incentives to provide reasonable schedules.626 Again, some of these proposals might be

addressed through rule changes under the Rules Enabling Act.

Finally, Professor Mullenix has proposed that Congress adopt legislation that would

create a presumption that class actions are the superior method of dealing with mass

torts cases. She defines “mass tort” as “a single act or series of closely related acts for which

a defendant may be liable in common-law tort to a minimum of one thousand claimants

for injuries either to the person or to property.”627 Her proposal also includes class action

provisions relating to notice, opting-in, and opting-out.628 Those proposals are relevant

to possible rule revisions, which is the subject of the next part of this report.

C. Rule-making proposals

1. Class actions

a. Settlement classes and Rules Enabling Act limits

Stimulated by the Advisory Committee on Civil Rules’s proposals to amend Rule 23, the

class action rule, there has been notable discussion in the legal literature concerning class

623. Coffee, supra note 69, at 1454–55.

624. Class Action Lawsuits: Examining Victim Compensation and Attorneys’ Fees: Hearings before the

Subcomm. on Administrative Oversight and the Courts of the Senate Comm. on the Judiciary, 105th Cong.

43 (1997) (statement of Professor John C. Coffee, Jr.).

625. Coffee, supra note 69, at 1455–56.

626. Id. at 1448–52.

627. Mullenix, Class Resolution, supra note 522, at 1091.

628. Id. at 1093–94.
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action proposals, and commentators have generated alternative proposals. We discussed

some of those proposals as legislative matters, in Part II.B.9.h (Amending class action

rules), because the proponents maintained that they exceeded the judiciary’s rule-making authority. Before we discuss rule-making proposals, let us examine what commentators say about the authority of judicial branch committees to alter the class action rules.

Congress enacted the Rules Enabling Act (REA) and amended it in 1988 to cede a

limited rule-making power to the judicial branch.629 The statutory limitation is that a

rule of procedure “shall not abridge, enlarge or modify any substantive right.”630 Over the

years, the Supreme Court has interpreted the “substantive right” language to apply only

to rights that are clearly substantive. If a right affected by a rule is arguably procedural,

the Court has found the rule to be constitutional.631 Indeed, “the Court has never applied

the REA to invalidate a Federal Rule.”632

In Amchem Products, Inc. v. Windsor,633 the Court referred to the REA and its “substantive right” language in discussing the application of Rule 23 to the settlement class

action involved in that case.634 As we discussed extensively above in Part II.A.1.c. (Aggregation—settlement classes after Amchem), the Court ruled that the fact of settlement has

relevance in determining whether certifying a class would pose insurmountable management problems under Rule 23 (b)(3)(D).635 Because Amchem involved interpreting Rule

23 in the face of an REA challenge, the ruling implies—but certainly does not clearly

hold—that drafting a rule permitting settlement classes would have passed REA muster.

A Harvard Law Review note argues that the right at issue in Amchem was a substantive

right. The argument is that

when a settlement, and not the pre-existing legal claims, creates the basis for treating a

class of individuals as a single juridical group, binding absent class members alters their

substantive right not to be so bound in a manner not encompassed by the existing

exception for class actions.636

629. See 28 U.S.C. § 2072 (1998). For a discussion of the background and legislative history of the Rules

Enabling Act, see generally Stephen B. Burbank, The Rules Enabling Act of 1934, 130 U. Pa. L. Rev. 1015 (1982).

630. 28 U.S.C. § 2072 (b) (1998).

631. See Note, The Rules Enabling Act and the Limits of Rule 23, 111 Harv. L. Rev. 2294, 2295–99 (1998)

[hereinafter Harvard Note].

632. Id. at 2294.

633. 117 S. Ct. 2231 (1997).

634. Id. at 2244.

635. Id. at 2248.

636. Harvard Note, supra note 631, at 2310.
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Because the “existing exception for class actions” is found in Rule 23, the argument has

some circularity, especially given the Court’s Amchem ruling that Rule 23 permits settlement to be taken into account in assessing manageability. To be consistent with its prior

REA cases, the Court’s ruling in Amchem may have meant that any impairment of substantive rights to litigate was seen as incidental.637 Stated conservatively, the Court’s ruling means that it did not reject the “arguably procedural” test that preceded the 1988

amendments to the REA; otherwise, “it is likely that any rule-created distinction between

the certification standard for litigation classes and settlement classes would not satisfy the

REA.”638

Other commentators read the judiciary’s authority under the REA much more restrictively. Writing without the benefit of the Amchem decision, Professor Paul Carrington

and Derek Apanovitch assert that the Advisory Committee on Civil Rules’ proposal to

recognize settlement classes in a new Rule 23(b)(4) clearly exceeds the judiciary’s authority under Article III of the United States Constitution and the REA.639 The authors argue

that the proposed rule “has nothing to do with the Article III mission of deciding cases or

controversies, but is instead a means of promoting and endorsing putative private dispositions by lending them the imprimatur of the court, thus garbing contracts in the dress

of judgments.”640 Carrington and Apanovitch detail their views of “at least ten substantive consequences confronted by the architects of global peace in mass torts.”641 They

recommend that the rules committee direct its settlement class proposal to Congress rather

than the Court, closing with the chilling comment that “If it is tempted to disregard this

advice, the analogy to the French aristocracy’s doom is worthy of the Committee’s attention.”642

637. See id.

638. Id. at 2311. After explicating a plausible argument that Amchem supports an expansive view of

Congress’s delegation of rule-making authority of the courts, the note calls for the Court or Congress to

“provide much needed clarity on this murky issue.” Id.

639. Paul D. Carrington & Derek P. Apanovitch, The Constitutional Limits of Judicial Rulemaking: The

Illegitimacy of Mass-Tort Settlements Negotiated Under Federal Rule 23, 39 Ariz. L. Rev. 461 (1997).

640. Id. at 463.

641. Id. at 464. Those consequences range from the rights of state governments to enact and enforce their

own tort laws and standards and conflicts of law rules, id. at 464–65, to the effects of recognizing a settlement

class on attorney-client relationships, id. at 466–68, to the relative value of individual settlement amounts, id.

at 469–71, and the right of an individual to control a legal claim, id. at 472.

642. Id. at 495, citing Stephen P. Burbank, Proposals to Amend Rule 68—Time to Abandon Ship, 19 U.

Mich. J.L. Reform 425, 432 (1986).
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Professor Linda Mullenix articulates an opposing viewpoint on the application of

Article III and the REA to settlement classes under either existing Rule 23 or the Advisory

Committee’s proposed Rule 23(b)(4). She asserts that the rule and its proposed cousin

pass muster under both constitutional and REA standards.643 In her view, the proposed

(b)(4) class is no more than “a descriptive functional category” like other components of

Rule 23.644 She notes that the collection of arguments about the impact on state substantive law prove too much in that they would also invalidate rules expressly empowering

courts to deal with settlements, such as Rules 23(e) and 16(c)(19).645 She addresses directly the ten substantive effects posed by Carrington and Apanovitch as well as a few that

they did not raise.646 While we leave it to the reader to assess the merits of these arguments, as we noted above, the Court’s ruling in Amchem implies that the current rule

passes REA muster and that it permits settlement classes under limited circumstances.

b. Settlement class proposals

Aside from REA considerations, commentators have expressed opinions for and against

Advisory Committee proposals to authorize settlement classes. Considerable opposition

to the Committee’s proposal came from the academic community in the form of a letter

signed by 129 law professors.647 This group objected specifically to Rule 23(b)(4) because

“it contains no limiting principles, standards or other guidelines . . . to help trial judges

decide when a settlement is desirable and what form the class should take” and because

“it raises serious constitutional and statutory questions that have not been adequately

addressed by the Advisory Committee.”648 The group also expressed concern that the

proposed rule “lends official approval to an extremely controversial practice, one plagued

by serious agency problems and risks of collusion.”649 A number of the signers also expressed their opposition to settlement classes in a 1995 Cornell Law Review symposium

with the punchy title Mass Tortes: Serving Up Just Desserts.

650

643. Linda S. Mullenix, The Constitutionality of the Proposed Rule 23 Class Action Amendments, 39 Ariz. L.

Rev. 615 (1997).

644. Id. at 626 (emphasis in original).

645. Id. at 627.

646. Id. at 624–35.

647. Letter from Steering Committee to Oppose Proposed Rule 23 to Honorable Alicemarie H. Stotler,

May 28, 1996 in Administrative Office of the United States Courts, 2 Working Papers of the Advisory Committee on Civil Rules on Proposed Amendments to Civil Rule 23, at 1 (1997).

648. Id.

649. Id.

650. See, e.g., Cramton, supra note 153; Susan P. Koniak, supra note 170.
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In one of the few post-Amchem articles to date, attorneys John Aldock and Richard

Wyner, counsel for the Center for Claims Resolution in Amchem, think a rule change is

unnecessary. In their estimation, the class certification issues that were fatal to the Amchem

settlement likely can be resolved by using more narrowly-defined classes or subclasses

and by appointing separate counsel and named representatives for each of those classes

or subclasses.651 They also conclude that other criticisms directed at mass torts settlement

class actions in Amchem—such as the alleged lack of a case or controversy and the difficulty of providing notice to future claimants—should not prove to be an insurmountable

obstacle to such settlements.652

Lest we begin to think Amchem settled the issue, Professor Eric Green, also in a postAmchem article, laments that the Court “apparently sounded the death knell for nationwide mass torts class actions (whether settled or litigated) under the current version of

Rule 23.”653 To remedy that situation, Green, an alternative dispute resolution (ADR)

practitioner, urges the Advisory Committee to adopt the proposed Rule 23(b)(4). In his

view, the

ultimate effect of the proposed amendment would be to clarify uncertainty about the

legitimacy of settlement classes, increase fairness and efficiency in class action litigation, reduce transaction costs, increase compensation to deserving plaintiffs, decrease

ruinous exposures and bankruptcy to defendants, and provide a reasonable and fair

tool in appropriate cases for federal courts to reduce the enormous drain on resources

caused by multiple harms—including mass products liability litigation (notwithstanding Amchem Products).654

Professor Judith Resnik provides a third post-Amchem opinion. In her judgment, the

ruling shows that “settlement has a strong appeal: none of the justices in Amchem wanted

to disown its function,” but “the quality of settlements is always a worry.”655 She concludes with the observation that the remedy lies with the judicial branch because “solutions have not yet come from Congress.”656 The Advisory Committee then has “an impor651. See Aldock & Wyner, supra note 144, at 941.

652. See id. at 917–20.

653. Eric D. Green, What Will We Do When Adjudication Ends? We’ll Settle in Bunches: Bringing Rule 23

into the Twenty-First Century, 44 UCLA L. Rev. 1773, 1775 (1997).

654. Id. at 1798–99.

655. Judith Resnik, Postscript: The Import of Amchem Products, Inc. v. Windsor, 30 U.C. Davis L. Rev. 881,

885 (1997).

656. Id. at 886.
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tant occasion in which to offer structure, to face the diversity of interests and individuals

within an aggregate, and to insist on judicial oversight of interests of absentees, even at

the expense of some settlements.”657

Before Amchem, a number of academic commentators supported the idea of permitting settlement class actions under some circumstances, suggesting alternatives to the

Advisory Committee’s (b)(4) proposal. For example, Professor Judith Resnik and Professor John Coffee collaborated on a proposal that would establish standards for informing

the class about a proposed settlement and detailing aspects of certification, notice, hearing, and settlement approval.658

The Resnik-Coffee proposal differentiates among class certification according to the

stage of the litigation, with different provisions for settlement and for pretrial litigation,

reserving full certification for trial. At whatever stages settlement is proposed, class action

rules must address a series of common issues, such as “the extent of the information

provided participants in a settlement about the remedy to be provided, whether claimants within a class are treated equally or distinguished by criteria that are appropriate, the

relationship between compensation to claimants and to attorneys, the cost of administering the remedy and how it is financed, the degree to which opting out is either legally or

practically feasible, and the timing of the processes of informing the class and permitting

opt outs.”659 Resnik and Coffee’s specific suggestions seem designed to provide information to class members and structure for the judge in reviewing certification or settlement

proposals.

Judge William Schwarzer also proposes a rule designed to provide structure to a district judge’s review of a proposed class settlement. Judge Schwarzer observed that “[i]n

the mass tort settlement context, . . . the class action is becoming a creature that resembles

a cross between an equity receivership and a bill of peace.”660 To counter the amorphous

growth of the settlement class, Judge Schwarzer proposed specifying in Rule 23(e) a set of

issues for a district judge to address when evaluating the procedural and substantive fair657. Id. at 887.

658. See Resnik, Litigating and Settling, supra note 189, at 865–71.

659. Id. at 848.

660. Schwarzer, supra note 29, at 841. See also discussion at notes 180–84.
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ness of proposed settlements. Those issues are detailed in the note.661 In Judge Schwarzer’s

view, guidelines should not be prescriptive but should give discretion that would lead the

court to give the settlement the consideration necessary to bring to light any serious defect and ensure that it is truly fair and equitable.662 Some of Judith Resnik’s suggestions

echo Judge Schwarzer proposal,663 and ALI-ABA commentators Charles Schwartz and

Lewis Sutherland endorse wholesale adoption of the Schwarzer proposal.664

c. Class action trial structure proposals

Several class action trial structure proposals warrant attention because of their innovative approaches. Professor John Coffee attacks the joint problems of the need for individual damage determinations and the dilemma of providing fair treatment to future

claimants in mass torts aggregations.665 In applying the prerequisites to class certification, a court would be required to develop standards responsive to the particular needs of

mass torts. For example, separate representation for future claimants would be expressly

required,666 and creating an adequately funded reserve for payment of future claims would

661. The issues are: (1) whether the prerequisites set forth in subdivisions (a) and (b) have been met; (2)

whether the class definition is appropriate and fair, taking into account among other things whether it is

consistent with the purpose for which the class is certified, whether it may be overinclusive or underinclusive,

and whether division into subclasses may be necessary or advisable; (3) whether persons with similar claims

will receive similar treatment, taking into account any differences in treatment between present and future

claimants; (4) whether notice to members of the class is adequate, taking into account the ability of persons

to understand the notice and its significance to them; (5) whether the representation of members of the class

is adequate, taking into account the possibility of conflicts of interest in the representation of persons whose

claims differ in material respects from those of other claimants; (6) whether opt-out rights are adequate to

fairly protect interests of class members; (7) whether the provisions for attorneys’ fees are reasonable, taking

into account the value and amount of services rendered and the risks assumed; (8) whether the settlement

will have significant effects on parties in other actions pending in state or federal courts; (9) whether the

settlement will have significant effects on potential claims of class members for injury or loss arising out of

the same or related occurrences but excluded from the settlement; (10) whether the compensation for loss

and damage provided by the settlement is within the range of reason, taking into account the balance of costs

to defendant and benefits to class members; and (11) whether the claims process under the settlement is

likely to be fair and equitable in its operation. Id. at 843–44.

662. See id. at 842–43.

663. See Resnik, Litigating and Settling, supra note 189, at 858, n. 86,

664. Charles W. Schwartz & Lewis C. Sutherland, Class Certification for Environmental and Toxic Tort

Claims, SA88 ALI-ABA 119 (1996).

665. Coffee, supra note 69, at 1433–42.

666. See id. at 1436.
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be part of the “superiority” requirement.667 Within that framework, Coffee proposes a

trial structure in which “the class action would resolve only the issues of liability and

generic causation.”668 Future claims could not be settled and would have to be resolved

individually, either by trial or another agreed method, such as an arbitration panel.669

Coffee presents his plan as “a compromise [that] makes political sense,”670 an attempt to

accommodate the sometimes disparate interests of plaintiffs, defendants, and courts.

Another approach to the trial structure of mass torts claims addresses present claims

only. This model relies on statistical sampling, extrapolation of damages from a sample

of cases in each injury category, and administrative distribution of the fund to individual

class members. If this sounds familiar, the proposal was used in the Cimino and Hilao

cases and found by one court of appeals to be unconstitutional as applied and by another

court of appeals to be constitutionally adequate in the face of a limited challenge.671 Professor Samuel Issacharoff, a member of Judge Parker’s team of consultants in Cimino,

presented the case for allowing a court to “determine a formula for the pro rata share of

damages among plaintiffs, relying on a damages matrix that assesses such factors as age,

length of exposure, disease pathology, and actuarial projections of lost income.”672 While

the details of his proposal seem substantive and beyond the Advisory Committee’s authority under the REA, formulation of required elements of a trial structure may be within

that authority.

d. Adequacy of class representation

Two suggestions for proposed changes in the adequacy of representation standard in

Rule 23 are worth discussing. Professor David Shapiro starts with the proposition that

“the constitutional propriety of class action treatment, and the binding effect of a judgment on the members of the class, turns on the issue of adequate representation.”673 He

recommends that this point “become the heart of a recrafted rule.”674 Specifically, Shapiro

calls for

667. See id. at 1437.

668. Id. at 1440.

669. See id. at 1440–41.

670. Id. at 1442.

671. See discussion infra notes 199–229.

672. Samuel Issacharoff, Administering Damage Awards in Mass-Tort Litigation, 10 Rev. Litig. 463, 467

(1991).

673. Shapiro, supra note 133, at 958–59.

674. Id. at 959.
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• “Focusing on the adequacy of counsel (rather than worrying about the named

representative);

• “Recognizing that adequacy requires consideration not only of counsel’s experience and ability but also of the potential existence of conflicts either within the

represented group or between that group and outsiders also represented by the

same counsel;

• “Making sure that counsel remains responsible to the class as a whole by establishing channels of communication with a sufficiently representative group of class

members and by allowing that group to be heard at critical stages of the process in

order to be sure that the class is not being manipulated either by counsel or by the

adversary; [and]

• “Developing explicit techniques to explore both the fairness of settlements in overall

terms and in terms of distributions to be made among class members, as well as

techniques to insure against disproportionate counsel fees.”675

Professor Coffee has developed an explicit suggestion for addressing the conflict of

interest problem. He would suggest that rule makers “adopt a mildly prophylactic rule

that disqualifies any attorney from serving as a lead counsel (for the class or any subclass)

if the attorney has negotiated an inventory settlement with the same defendants.”676 Another alternative would be to disqualify an attorney only if the inventory settlement provided more favorable terms than the proposed class settlement, but that would put a

court in the position of choosing between enforcing the ban and approving a settlement.677

The prophylactic rule would prevent the dilemma from arising. A more direct way of

achieving the same result might be to bar a settlement that provides less favorable terms

for the class than provided by a previous inventory settlement, but that approach appears

to be primarily, if not totally, substantive and outside the rule-making authority.

2. Ethics of mass torts lawyering and judging

The issue of drafting ethical rules for lawyers on subjects of special federal interest has

been raised by the Standing Committee on Rules of Practice. Though at the borderline of

the historic subject matter of the Advisory Committees, drafting rules to govern lawyers

representing plaintiffs and defendants in mass torts contexts might be considered in the

context of a general reexamination of federal ethics rules. As with most of the issues

discussed in this report, we have neither the time nor the space to give this topic the

675. Id.

676. Coffee, supra note 69, at 1445.

677. See id. at 1444–45.
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attention it deserves. Mentioning a few of the major works on the subject, however, may

serve to call attention to the needs and opportunities for mass torts rule making.

Professor Carrie Menkel-Meadow summarizes her analysis of the state of the art of

ethics and mass torts in what she calls “a simple argument: The current ethical rules on

conflicts of interests, limitation of practice, and ethics in negotiation and litigation . . . were

not drafted with the special issues of mass tort class action settlements in mind, and do not, in

my view, provide adequate guidance for how those issues should be resolved.”678 Her conclusion: “Our legal system, and ethical rules, must confront the tensions between our ideals of

individual justice and the reality of a need for ‘aggregate’ justice.”679Menkel-Meadow describes clearly the varied interests involved in mass torts litigation, the conflicts of interests, collusion, and restrictions on practice that arise in mass torts litigation, and documents her case for new ethical rules. Along similar lines, Judith Resnik calls for new procedural and ethical rules that would “specify the respective roles of lawyers and clients

and the roles of different lawyers—those on the inside, sitting at the table, and those who

never appear in court.”680 Such rules need to “go hand in hand” with fee award allocations.681

Looking at one specific ethical issue, aggregate settlements, Paul Rheingold, an experienced mass torts plaintiffs’ attorney, observes that “any lawyer who handles mass tort

litigation is faced constantly with offers by a defendant to settle an inventory of cases at

one time” and that “there is no ready solution” to the problems posed by such offers.682

Law professors Charles Silver and Lynn Baker analyze in depth the current rule on aggregate settlements, Model Rule of Professional Conduct 1.8 (g), and conclude that “there

are identifiable reasons for thinking that alternative disclosure and consent rules may

work better for clients in some mass tort cases and that the option of using them should

be available.”683 Both the practitioners’ and the academics’ views converge in identifying

the tension created by the attempt to apply to mass torts a rule designed for a single case

or a small number of cases.

678. Menkel-Meadow, supra note 184, at 1172 (emphasis in original).

679. Id.

680. Resnik, Procedural Innovations, supra note 305, at 1644–45.

681. Id. at 1645. See generally, Resnik et al., supra note 64.

682. Rheingold, supra note 222, at 395.

683. Charles Silver & Lynn A. Baker, Mass Lawsuits and the Aggregate Settlement Rule, 32 Wake Forest L.

Rev. 733, 736 (1997).
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Finally, in a magnum opus that helped define the field of ethics and mass torts, Judge

Jack Weinstein presents a sweeping portrayal of the major ethical dilemmas that confront

lawyers and judges in the mass torts field.684 Judge Weinstein, however, does not see ethical rules as a panacea, or even a palliative, for those problems. In his view, “[t]oo rigid an

adherence to formal ethical-legal rules constitutes a violation of the basic rule of ethics

itself, requiring a practicable regime in which the needs of the public, the parties, and the

law are in reasonable balance.”685

The above comments are presented as a starting point for considering the ethical issues for lawyers raised by the demands of mass torts litigation. Because of its interstate

nature and the unique demands that such litigation imposes on federal courts, the time

may be right for federal rule-making bodies to exercise leadership in this area.

3. Conclusion

After starting with an examination of whether mass torts present problems for the legal

system and finding a nonunanimous consensus that they do, we discussed a host of problems identified by a wide variety of commentators. The breadth of proposals to address

those problems—spanning a full spectrum of case-management, legislative, and rulemaking innovations—suggests there is a broad consensus that mass torts problems warrant prompt action. That consensus shows signs of fragility, and outright rupture, when

specific proposals are considered. Molding that fragile consensus into meaningful action

is the challenge that faces the Mass Torts Working Group and any successor group that

may be appointed.

684. Weinstein, Ethical Dilemmas, supra note 30; but cf. Linda S. Mullenix, Mass Tort As Public Law Litigation: Paradigm Misplaced, 88 Nw. U. L. Rev. 579 (1994); see also Weinstein, Individual Justice, supra note 18.

685. Weinstein, Ethical Dilemmas, supra note 30, at 492.