II

Calendar No. 341

106TH CONGRESS

1ST SESSION H. R. 2112

IN THE SENATE OF THE UNITED STATES

SEPTEMBER 14, 1999

Received; read twice and referred to the Committee on the Judiciary

OCTOBER 21, 1999

Reported by Mr. HATCH, with an amendment

[Strike out all after the enacting clause and insert the part printed in italic]

AN ACT

To amend title 28, United States Code, to allow a judge

to whom a case is transferred to retain jurisdiction over

certain multidistrict litigation cases for trial, and to provide for Federal jurisdiction of certain multiparty,

multiforum civil actions.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Multidistrict,

5 Multiparty, Multiforum Trial Jurisdiction Act of 1999’’.
2

HR 2112 RS

1 SEC. 2. MULTIDISTRICT LITIGATION.

2 Section 1407 of title 28, United States Code, is

3 amended—

4 (1) in the third sentence of subsection (a), by

5 inserting ‘‘or ordered transferred to the transferee

6 or other district under subsection (i)’’ after ‘‘termi7 nated’’; and

8 (2) by adding at the end the following new sub9 section:

10 ‘‘(i)(1) Subject to paragraph (2) and except as pro11 vided in subsection (j), any action transferred under this

12 section by the panel may be transferred for trial purposes,

13 by the judge or judges of the transferee district to whom

14 the action was assigned, to the transferee or other district

15 in the interest of justice and for the convenience of the

16 parties and witnesses.

17 ‘‘(2) Any action transferred for trial purposes under

18 paragraph (1) shall be remanded by the panel for the de19 termination of compensatory damages to the district court

20 from which it was transferred, unless the court to which

21 the action has been transferred for trial purposes also

22 finds, for the convenience of the parties and witnesses and

23 in the interests of justice, that the action should be re24 tained for the determination of compensatory damages.’’.
3

HR 2112 RS

1 SEC. 3. MULTIPARTY, MULTIFORUM JURISDICTION OF DIS2 TRICT COURTS.

3 (a) BASIS OF JURISDICTION.—

4 (1) IN GENERAL.—Chapter 85 of title 28,

5 United States Code, is amended by adding at the

6 end the following new section:

7 ‘‘§ 1369. Multiparty, multiforum jurisdiction

8 ‘‘(a) IN GENERAL.—The district courts shall have

9 original jurisdiction of any civil action involving minimal

10 diversity between adverse parties that arises from a single

11 accident, where at least 25 natural persons have either

12 died or incurred injury in the accident at a discrete loca13 tion and, in the case of injury, the injury has resulted in

14 damages which exceed $75,000 per person, exclusive of in15 terest and costs, if—

16 ‘‘(1) a defendant resides in a State and a sub17 stantial part of the accident took place in another

18 State or other location, regardless of whether that

19 defendant is also a resident of the State where a

20 substantial part of the accident took place;

21 ‘‘(2) any two defendants reside in different

22 States, regardless of whether such defendants are

23 also residents of the same State or States; or

24 ‘‘(3) substantial parts of the accident took place

25 in different States.
4

HR 2112 RS

1 ‘‘(b) SPECIAL RULES AND DEFINITIONS.—For pur2 poses of this section—

3 ‘‘(1) minimal diversity exists between adverse

4 parties if any party is a citizen of a State and any

5 adverse party is a citizen of another State, a citizen

6 or subject of a foreign state, or a foreign state as

7 defined in section 1603(a) of this title;

8 ‘‘(2) a corporation is deemed to be a citizen of

9 any State, and a citizen or subject of any foreign

10 state, in which it is incorporated or has its principal

11 place of business, and is deemed to be a resident of

12 any State in which it is incorporated or licensed to

13 do business or is doing business;

14 ‘‘(3) the term ‘injury’ means—

15 ‘‘(A) physical harm to a natural person;

16 and

17 ‘‘(B) physical damage to or destruction of

18 tangible property, but only if physical harm de19 scribed in subparagraph (A) exists;

20 ‘‘(4) the term ‘accident’ means a sudden acci21 dent, or a natural event culminating in an accident,

22 that results in death or injury incurred at a discrete

23 location by at least 25 natural persons; and
5

HR 2112 RS

1 ‘‘(5) the term ‘State’ includes the District of

2 Columbia, the Commonwealth of Puerto Rico, and

3 any territory or possession of the United States.

4 ‘‘(c) INTERVENING PARTIES.—In any action in a dis5 trict court which is or could have been brought, in whole

6 or in part, under this section, any person with a claim

7 arising from the accident described in subsection (a) shall

8 be permitted to intervene as a party plaintiff in the action,

9 even if that person could not have brought an action in

10 a district court as an original matter.

11 ‘‘(d) NOTIFICATION OF JUDICIAL PANEL ON MULTI12 DISTRICT LITIGATION.—A district court in which an ac13 tion under this section is pending shall promptly notify

14 the judicial panel on multidistrict litigation of the pend15 ency of the action.’’.

16 (2) CONFORMING AMENDMENT.—The table of

17 sections at the beginning of chapter 85 of title 28,

18 United States Code, is amended by adding at the

19 end the following new item:

‘‘1369. Multiparty, multiforum jurisdiction.’’.

20 (b) VENUE.—Section 1391 of title 28, United States

21 Code, is amended by adding at the end the following:

22 ‘‘(g) A civil action in which jurisdiction of the district

23 court is based upon section 1369 of this title may be

24 brought in any district in which any defendant resides or
6

HR 2112 RS

1 in which a substantial part of the accident giving rise to

2 the action took place.’’.

3 (c) MULTIDISTRICT LITIGATION.—Section 1407 of

4 title 28, United States Code, as amended by section 2 of

5 this Act, is further amended by adding at the end the fol6 lowing:

7 ‘‘(j)(1) In actions transferred under this section when

8 jurisdiction is or could have been based, in whole or in

9 part, on section 1369 of this title, the transferee district

10 court may, notwithstanding any other provision of this

11 section, retain actions so transferred for the determination

12 of liability and punitive damages. An action retained for

13 the determination of liability shall be remanded to the dis14 trict court from which the action was transferred, or to

15 the State court from which the action was removed, for

16 the determination of damages, other than punitive dam17 ages, unless the court finds, for the convenience of parties

18 and witnesses and in the interest of justice, that the action

19 should be retained for the determination of damages.

20 ‘‘(2) Any remand under paragraph (1) shall not be

21 effective until 60 days after the transferee court has

22 issued an order determining liability and has certified its

23 intention to remand some or all of the transferred actions

24 for the determination of damages. An appeal with respect

25 to the liability determination and the choice of law deter-
7

HR 2112 RS

1 mination of the transferee court may be taken during that

2 60-day period to the court of appeals with appellate juris3 diction over the transferee court. In the event a party files

4 such an appeal, the remand shall not be effective until the

5 appeal has been finally disposed of. Once the remand has

6 become effective, the liability determination and the choice

7 of law determination shall not be subject to further review

8 by appeal or otherwise.

9 ‘‘(3) An appeal with respect to determination of puni10 tive damages by the transferee court may be taken, during

11 the 60-day period beginning on the date the order making

12 the determination is issued, to the court of appeals with

13 jurisdiction over the transferee court.

14 ‘‘(4) Any decision under this subsection concerning

15 remand for the determination of damages shall not be re16 viewable by appeal or otherwise.

17 ‘‘(5) Nothing in this subsection shall restrict the au18 thority of the transferee court to transfer or dismiss an

19 action on the ground of inconvenient forum.’’.

20 (d) REMOVAL OF ACTIONS.—Section 1441 of title 28,

21 United States Code, is amended—

22 (1) in subsection (e) by striking ‘‘(e) The court

23 to which such civil action is removed’’ and inserting

24 ‘‘(f) The court to which a civil action is removed

25 under this section’’; and
8

HR 2112 RS

1 (2) by inserting after subsection (d) the fol2 lowing new subsection:

3 ‘‘(e)(1) Notwithstanding the provisions of subsection

4 (b) of this section, a defendant in a civil action in a State

5 court may remove the action to the district court of the

6 United States for the district and division embracing the

7 place where the action is pending if—

8 ‘‘(A) the action could have been brought in a

9 United States district court under section 1369 of

10 this title; or

11 ‘‘(B) the defendant is a party to an action

12 which is or could have been brought, in whole or in

13 part, under section 1369 in a United States district

14 court and arises from the same accident as the ac15 tion in State court, even if the action to be removed

16 could not have been brought in a district court as

17 an original matter.

18 The removal of an action under this subsection shall be

19 made in accordance with section 1446 of this title, except

20 that a notice of removal may also be filed before trial of

21 the action in State court within 30 days after the date

22 on which the defendant first becomes a party to an action

23 under section 1369 in a United States district court that

24 arises from the same accident as the action in State court,

25 or at a later time with leave of the district court.
9

HR 2112 RS

1 ‘‘(2) Whenever an action is removed under this sub2 section and the district court to which it is removed or

3 transferred under section 1407(j) has made a liability de4 termination requiring further proceedings as to damages,

5 the district court shall remand the action to the State

6 court from which it had been removed for the determina7 tion of damages, unless the court finds that, for the con8 venience of parties and witnesses and in the interest of

9 justice, the action should be retained for the determination

10 of damages.

11 ‘‘(3) Any remand under paragraph (2) shall not be

12 effective until 60 days after the district court has issued

13 an order determining liability and has certified its inten14 tion to remand the removed action for the determination

15 of damages. An appeal with respect to the liability deter16 mination and the choice of law determination of the dis17 trict court may be taken during that 60-day period to the

18 court of appeals with appellate jurisdiction over the dis19 trict court. In the event a party files such an appeal, the

20 remand shall not be effective until the appeal has been

21 finally disposed of. Once the remand has become effective,

22 the liability determination and the choice of law deter23 mination shall not be subject to further review by appeal

24 or otherwise.
10

HR 2112 RS

1 ‘‘(4) Any decision under this subsection concerning

2 remand for the determination of damages shall not be re3 viewable by appeal or otherwise.

4 ‘‘(5) An action removed under this subsection shall

5 be deemed to be an action under section 1369 and an ac6 tion in which jurisdiction is based on section 1368 of this

7 title for purposes of this section and sections 1407, 1660,

8 1697, and 1785 of this title.

9 ‘‘(6) Nothing in this subsection shall restrict the au10 thority of the district court to transfer or dismiss an ac11 tion on the ground of inconvenient forum.’’.

12 (e) CHOICE OF LAW.—

13 (1) DETERMINATION BY THE COURT.—Chapter

14 111 of title 28, United States Code, is amended by

15 adding at the end the following new section:

16 ‘‘§ 1660. Choice of law in multiparty, multiforum ac17 tions

18 ‘‘(a) FACTORS.—In an action which is or could have

19 been brought, in whole or in part, under section 1369 of

20 this title, the district court in which the action is brought

21 or to which it is removed shall determine the source of

22 the applicable substantive law, except that if an action is

23 transferred to another district court, the transferee court

24 shall determine the source of the applicable substantive

25 law. In making this determination, a district court shall
11

HR 2112 RS

1 not be bound by the choice of law rules of any State, and

2 the factors that the court may consider in choosing the

3 applicable law include—

4 ‘‘(1) the place of the injury;

5 ‘‘(2) the place of the conduct causing the in6 jury;

7 ‘‘(3) the principal places of business or

8 domiciles of the parties;

9 ‘‘(4) the danger of creating unnecessary incen10 tives for forum shopping; and

11 ‘‘(5) whether the choice of law would be reason12 ably foreseeable to the parties.

13 The factors set forth in paragraphs (1) through (5) shall

14 be evaluated according to their relative importance with

15 respect to the particular action. If good cause is shown

16 in exceptional cases, including constitutional reasons, the

17 court may allow the law of more than one State to be ap18 plied with respect to a party, claim, or other element of

19 an action.

20 ‘‘(b) ORDER DESIGNATING CHOICE OF LAW.—The

21 district court making the determination under subsection

22 (a) shall enter an order designating the single jurisdiction

23 whose substantive law is to be applied in all other actions

24 under section 1369 arising from the same accident as that

25 giving rise to the action in which the determination is
12

HR 2112 RS

1 made. The substantive law of the designated jurisdiction

2 shall be applied to the parties and claims in all such ac3 tions before the court, and to all other elements of each

4 action, except where Federal law applies or the order spe5 cifically provides for the application of the law of another

6 jurisdiction with respect to a party, claim, or other ele7 ment of an action.

8 ‘‘(c) CONTINUATION OF CHOICE OF LAW AFTER RE9 MAND.—In an action remanded to another district court

10 or a State court under section 1407(j)(1) or 1441(e)(2)

11 of this title, the district court’s choice of law under sub12 section (b) shall continue to apply.’’.

13 (2) CONFORMING AMENDMENT.—The table of

14 sections at the beginning of chapter 111 of title 28,

15 United States Code, is amended by adding at the

16 end the following new item:

‘‘1660. Choice of law in multiparty, multiforum actions.’’.

17 (f) SERVICE OF PROCESS.—

18 (1) OTHER THAN SUBPOENAS.—(A) Chapter

19 113 of title 28, United States Code, is amended by

20 adding at the end the following new section:

21 ‘‘§ 1697. Service in multiparty, multiforum actions

22 ‘‘When the jurisdiction of the district court is based

23 in whole or in part upon section 1369 of this title, process,

24 other than subpoenas, may be served at any place within
13

HR 2112 RS

1 the United States, or anywhere outside the United States

2 if otherwise permitted by law.’’.

3 (B) The table of sections at the beginning of

4 chapter 113 of title 28, United States Code, is

5 amended by adding at the end the following new

6 item:

‘‘1697. Service in multiparty, multiforum actions.’’.

7 (2) SERVICE OF SUBPOENAS.—(A) Chapter 117

8 of title 28, United States Code, is amended by add9 ing at the end the following new section:

10 ‘‘§ 1785. Subpoenas in multiparty, multiforum actions

11 ‘‘When the jurisdiction of the district court is based

12 in whole or in part upon section 1369 of this title, a sub13 poena for attendance at a hearing or trial may, if author14 ized by the court upon motion for good cause shown, and

15 upon such terms and conditions as the court may impose,

16 be served at any place within the United States, or any17 where outside the United States if otherwise permitted by

18 law.’’.

19 (B) The table of sections at the beginning of

20 chapter 117 of title 28, United States Code, is

21 amended by adding at the end the following new

22 item:

‘‘1785. Subpoenas in multiparty, multiforum actions.’’.
14

HR 2112 RS

1 SEC. 4. EFFECTIVE DATE.

2 (a) SECTION 2.—The amendments made by section

3 2 shall apply to any civil action pending on or brought

4 on or after the date of the enactment of this Act.

5 (b) SECTION 3.—The amendments made by section

6 3 shall apply to a civil action if the accident giving rise

7 to the cause of action occurred on or after the 90th day

8 after the date of the enactment of this Act.

Passed the House of Representatives September 13,

1999.

Attest: JEFF TRANDAHL,

Clerk.

9 SECTION 1. SHORT TITLE.

10 This Act may be cited as the ‘‘Multidistrict Jurisdic11 tion Act of 1999’’.

12 SEC. 2. MULTIDISTRICT LITIGATION.

13 Section 1407 of title 28, United States Code, is

14 amended—

15 (1) in the third sentence of subsection (a), by in16 serting ‘‘or ordered transferred to the transferee or

17 other district under subsection (i)’’ after ‘‘termi18 nated’’; and

19 (2) by adding at the end the following new sub20 section:

21 ‘‘(i)(1) Subject to paragraph (2), any action trans22 ferred under this section by the panel may be transferred,
15

HR 2112 RS

1 for trial purposes, by the judge or judges of the transferee

2 district to whom the action was assigned to the transferee

3 or other district in the interest of justice and for the conven4 ience of the parties and witnesses.

5 ‘‘(2) Any action transferred for trial purposes under

6 paragraph (1) shall be remanded by the panel for the deter7 mination of compensatory damages to the district court

8 from which it was transferred, unless the court to which

9 the action has been transferred for trial purposes also finds,

10 for the convenience of the parties and witnesses and in the

11 interests of justice, that the action should be retained for

12 the determination of compensatory damages.’’.

13 SEC. 3. EFFECTIVE DATE.

14 The amendments made by this Act shall apply to any

15 civil action pending on or brought on or after the date of

16 the enactment of this Act.
Calendar No. 341

106TH CONGRESS

1ST SESSION H. R. 2112

AN ACT

To amend title 28, United States Code, to allow a

judge to whom a case is transferred to retain jurisdiction over certain multidistrict litigationcases for trial, and to provide for Federal jurisdiction of certain multiparty, multiforum civil actions.

OCTOBER 21, 1999

Reported with an amendment