[Congressional Record Volume 145, Number 81 (Wednesday, June 9, 1999)]
[Extensions of Remarks]
[Pages E1182-E1183]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   THE MULTIDISTRICT, MULTIPARTY, MULTIFORUM JURISDICTION ACT OF 1999

                                 ______
                                 

                    HON. F. JAMES SENSENBRENNER, JR.

                              of wisconsin

                    in the house of representatives

                        Wednesday, June 9, 1999

  Mr. SENSENBRENNER. Mr. Speaker, I rise to introduce the 
``Multidistrict, Multiparty, Multiforum Jurisdiction Act of 1999.'' The 
bill synthesizes the contents of two other measures I have authored, 
H.R. 1852 and H.R. 967.
  Section 2 of my bill is identical to H.R. 1852, the ``Multidistrict 
Trial Jurisdiction Act of 1999,'' which I introduced on May 18 at the 
behest of the Administrative Office of the U.S. Courts, or the ``AO.'' 
The AO is concerned over a Supreme Court opinion, the so-called Lexecon 
case, pertaining to Section 1407 of Title 28 of the U.S. Code. This 
statute governs federal multidistrict litigation.
  Under Section 1407, a Multidistrict Litigation Panel--a select group 
of seven federal judges picked by the Chief Justice--helps to 
consolidate lawsuits which share common questions of fact filed in more 
than one judicial district nationwide. Typically, these suits involve 
mass torts--a plane crash, for example--in which the plaintiffs are 
from many different states. All things considered, the panel attempts 
to identify the one district court nationwide which is best adept at 
adjudicating pretrial matters. The panel then remands individual cases 
back to the district where they were originally filed for trial unless 
they have been previously terminated.
  For approximately 30 years, however, the district court selected by 
the panel to hear pretrial matters (the ``transferee court'') often 
invoked Section 1404(a) of Title 28 to retain jurisdiction for trial 
over all of the suits. This is a general venue statute that allows a 
district court to transfer a civil action to any other district or 
division where it may have been brought; in effect, the court selected 
by the panel simply transferred all of the cases to itself.
  According to the AO, this process has worked well, since the 
transferee court was versed in the facts and law of the consolidated 
litigation. This is also the one court which could compel all parties 
to settle when appropriate.
  The Lexecon decision alters the Section 1407 landscape. This was a 
1998 defamation case brought by a consulting entity (Lexecon) against a 
law firm that had represented a plaintiff class in the Lincoln Savings 
and Loan litigation in Arizona. Lexecon had been joined as a defendant 
to the class action, which the Multidistrict Litigation Panel 
transferred to the District of Arizona. Before the pretrial proceedings 
were concluded, Lexecon reached a ``resolution'' with the plaintiffs, 
and the claims against the consulting entity were dismissed.
  Lexecon then brought a defamation suit against the law firm in the 
Northern District for Illinois. The law firm moved under Section 1407 
that the Multidistrict Litigation Panel empower the Arizona court which 
adjudicated the original S&L litigation to preside over the defamation 
suit. The panel agreed, and the Arizona transferee court subsequently 
invoked its jurisdiction pursuant to Section 104 to preside over a 
trial that the law firm eventually won. Lexecon appealed, but the Ninth 
Circuit affirmed the lower court decision.
  The Supreme Court reversed, however, holding that Section 1407 
explicitly requires a transferee court to remand all cases for trial 
back to the respective jurisdictions from which they were originally 
referred. In his opinion, Justice Souter observed that ``the floor of 
Congress'' was the proper venue to determine whether the practice of 
self-assignment under these conditions should continue.
  Mr. Speaker, Section 2 of this legislation responds to Justice 
Souter's admonition. It would simply amend Section 1407 by explicitly 
allowing a transferee court to retain jurisdiction over referred cases 
for trial, or refer them to other districts, as it sees fit. This 
change makes sense in light of past judicial practice

[[Page E1183]]

under the Multidistrict Litigation statute. It obviously promotes 
judicial administrative efficiency.

  Section 3 of the bill consists of the text of H.R. 967, the 
``Multiparty, Multiforum Jurisdiction Act of 1999,'' which I introduced 
on March 3rd. This is a bill that the House of Representatives passed 
during the 101st and 102nd Congresses with Democratic majorities. The 
Committee on the Judiciary favorably reported this bill during the 
103rd Congress, also under a Democratic majority, and just last term 
the House approved the legislation as Section 10 of H.R. 1252, the 
``Judicial Reform Act.'' The Judicial Conference and the Department of 
Justice have supported this measure in the past.
  Section 3 of the bill would bestow original jurisdiction on federal 
district courts in civil actions involving minimal diversity 
jurisdiction among adverse parties based on a single accident--like a 
plane or train crash--where at least 25 persons have either died or 
sustained injuries exceeding $50,000 per person. The transferee court 
would retain those cases for determination of liability and punitive 
damages, and would also determine the substantive law that would apply 
for liability and punitive damages. If liability is established, the 
transferee court would then remand the appropriate cases back to the 
federal and state courts from which they were referred for a 
determination of compensatory and actual damages.
  Mr. Speaker, Section 3 will help to reduce litigation costs as well 
as the likelihood of forum shopping in mass tort cases. An effective 
one-time determination of punitive damages would eliminate multiple or 
inconsistent awards arising from multiforum litigation. At the same 
time, however, trial attorneys will have the opportunity to go before 
juries in their home states for compensatory and actual damages.
  Mr. Speaker, I look forward to a hearing on this measure which will 
take place before the Subcommittee on Courts and Intellectual Property.
  The legislation speaks to process, fairness, and judicial efficiency. 
It will not interfere with jury verdicts or compensation rates for 
litigators. I therefore urge my colleagues to support the 
Multidistrict, Mulitparty, Multiforum Jurisdiction Act of 1999 when it 
is reported to the House of Representatives for consideration.

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