[Congressional Record Volume 145, Number 118 (Monday, September 13, 1999)]
[House]
[Pages H8106-H8109]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  MULTIDISTRICT, MULTIPARTY, MULTIFORUM TRIAL JURISDICTION ACT OF 1999

  The SPEAKER pro tempore.
  Mr. COBLE. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 2112) 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, as 
amended.
  The Clerk read as follows:

                               H.R. 2112

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Multidistrict, Multiparty, 
     Multiforum Trial Jurisdiction Act of 1999''.

     SEC. 2. MULTIDISTRICT LITIGATION.

       Section 1407 of title 28, United States Code, is amended--
       (1) in the third sentence of subsection (a), by inserting 
     ``or ordered transferred to the transferee or other district 
     under subsection (i)'' after ``terminated''; and
       (2) by adding at the end the following new subsection:
       ``(i)(1) Subject to paragraph (2) and except as provided in 
     subsection (j), any action transferred under this section by 
     the panel may be transferred for trial purposes, by the judge 
     or judges of the transferee district to whom the action was 
     assigned, to the transferee or other district in the interest 
     of justice and for the convenience of the parties and 
     witnesses.
       ``(2) Any action transferred for trial purposes under 
     paragraph (1) shall be remanded by the panel for the 
     determination of compensatory damages to the district court 
     from which it was transferred, unless the court to which the 
     action has been transferred for trial purposes also finds, 
     for the convenience of the parties and witnesses and in the 
     interests of justice, that the action should be retained for 
     the determination of compensatory damages.''.

     SEC. 3. MULTIPARTY, MULTIFORUM JURISDICTION OF DISTRICT 
                   COURTS.

       (a) Basis of Jurisdiction.--
       (1) In general.--Chapter 85 of title 28, United States 
     Code, is amended by adding at the end the following new 
     section:

     ``Sec. 1369. Multiparty, multiforum jurisdiction

       ``(a) In General.--The district courts shall have original 
     jurisdiction of any civil action involving minimal diversity 
     between adverse parties that arises from a single accident, 
     where at least 25 natural persons have either died or 
     incurred injury in the accident at a discrete location and, 
     in the case of injury, the injury has resulted in damages 
     which exceed $75,000 per person, exclusive of interest and 
     costs, if--
       ``(1) a defendant resides in a State and a substantial part 
     of the accident took place in another State or other 
     location, regardless of whether that defendant is also a 
     resident of the State where a substantial part of the 
     accident took place;
       ``(2) any two defendants reside in different States, 
     regardless of whether such defendants are also residents of 
     the same State or States; or
       ``(3) substantial parts of the accident took place in 
     different States.
       ``(b) Special Rules and Definitions.--For purposes of this 
     section--
       ``(1) minimal diversity exists between adverse parties if 
     any party is a citizen of a State and any adverse party is a 
     citizen of another State, a citizen or subject of a foreign 
     state, or a foreign state as defined in section 1603(a) of 
     this title;

[[Page H8107]]

       ``(2) a corporation is deemed to be a citizen of any State, 
     and a citizen or subject of any foreign state, in which it is 
     incorporated or has its principal place of business, and is 
     deemed to be a resident of any State in which it is 
     incorporated or licensed to do business or is doing business;
       ``(3) the term `injury' means--
       ``(A) physical harm to a natural person; and
       ``(B) physical damage to or destruction of tangible 
     property, but only if physical harm described in subparagraph 
     (A) exists;
       ``(4) the term `accident' means a sudden accident, or a 
     natural event culminating in an accident, that results in 
     death or injury incurred at a discrete location by at least 
     25 natural persons; and
       ``(5) the term `State' includes the District of Columbia, 
     the Commonwealth of Puerto Rico, and any territory or 
     possession of the United States.
       ``(c) Intervening Parties.--In any action in a district 
     court which is or could have been brought, in whole or in 
     part, under this section, any person with a claim arising 
     from the accident described in subsection (a) shall be 
     permitted to intervene as a party plaintiff in the 
     action, even if that person could not have brought an 
     action in a district court as an original matter.
       ``(d) Notification of Judicial Panel on Multidistrict 
     Litigation.--A district court in which an action under this 
     section is pending shall promptly notify the judicial panel 
     on multidistrict litigation of the pendency of the action.''.
       (2) Conforming amendment.--The table of sections at the 
     beginning of chapter 85 of title 28, United States Code, is 
     amended by adding at the end the following new item:

``1369. Multiparty, multiforum jurisdiction.''.
       (b) Venue.--Section 1391 of title 28, United States Code, 
     is amended by adding at the end the following:
       ``(g) A civil action in which jurisdiction of the district 
     court is based upon section 1369 of this title may be brought 
     in any district in which any defendant resides or in which a 
     substantial part of the accident giving rise to the action 
     took place.''.
       (c) Multidistrict Litigation.--Section 1407 of title 28, 
     United States Code, as amended by section 2 of this Act, is 
     further amended by adding at the end the following:
       ``(j)(1) In actions transferred under this section when 
     jurisdiction is or could have been based, in whole or in 
     part, on section 1369 of this title, the transferee district 
     court may, notwithstanding any other provision of this 
     section, retain actions so transferred for the determination 
     of liability and punitive damages. An action retained for the 
     determination of liability shall be remanded to the district 
     court from which the action was transferred, or to the State 
     court from which the action was removed, for the 
     determination of damages, other than punitive damages, unless 
     the court finds, for the convenience of parties and witnesses 
     and in the interest of justice, that the action should be 
     retained for the determination of damages.
       ``(2) Any remand under paragraph (1) shall not be effective 
     until 60 days after the transferee court has issued an order 
     determining liability and has certified its intention to 
     remand some or all of the transferred actions for the 
     determination of damages. An appeal with respect to the 
     liability determination and the choice of law determination 
     of the transferee court may be taken during that 60-day 
     period to the court of appeals with appellate jurisdiction 
     over the transferee court. In the event a party files such an 
     appeal, the remand shall not be effective until the appeal 
     has been finally disposed of. Once the remand has become 
     effective, the liability determination and the choice of law 
     determination shall not be subject to further review by 
     appeal or otherwise.
       ``(3) An appeal with respect to determination of punitive 
     damages by the transferee court may be taken, during the 60-
     day period beginning on the date the order making the 
     determination is issued, to the court of appeals with 
     jurisdiction over the transferee court.
       ``(4) Any decision under this subsection concerning remand 
     for the determination of damages shall not be reviewable by 
     appeal or otherwise.
       ``(5) Nothing in this subsection shall restrict the 
     authority of the transferee court to transfer or dismiss an 
     action on the ground of inconvenient forum.''.
       (d) Removal of Actions.--Section 1441 of title 28, United 
     States Code, is amended--
       (1) in subsection (e) by striking ``(e) The court to which 
     such civil action is removed'' and inserting ``(f) The court 
     to which a civil action is removed under this section''; and
       (2) by inserting after subsection (d) the following new 
     subsection:
       ``(e)(1) Notwithstanding the provisions of subsection (b) 
     of this section, a defendant in a civil action in a State 
     court may remove the action to the district court of the 
     United States for the district and division embracing the 
     place where the action is pending if--
       ``(A) the action could have been brought in a United States 
     district court under section 1369 of this title, or
       ``(B) the defendant is a party to an action which is or 
     could have been brought, in whole or in part, under section 
     1369 in a United States district court and arises from the 
     same accident as the action in State court, even if the 
     action to be removed could not have been brought in a 
     district court as an original matter.
     The removal of an action under this subsection shall be made 
     in accordance with section 1446 of this title, except that a 
     notice of removal may also be filed before trial of the 
     action in State court within 30 days after the date on which 
     the defendant first becomes a party to an action under 
     section 1369 in a United States district court that arises 
     from the same accident as the action in State court, or at a 
     later time with leave of the district court.
       ``(2) Whenever an action is removed under this subsection 
     and the district court to which it is removed or transferred 
     under section 1407(j) has made a liability determination 
     requiring further proceedings as to damages, the district 
     court shall remand the action to the State court from which 
     it had been removed for the determination of damages, unless 
     the court finds that, for the convenience of parties and 
     witnesses and in the interest of justice, the action should 
     be retained for the determination of damages.
       ``(3) Any remand under paragraph (2) shall not be effective 
     until 60 days after the district court has issued an order 
     determining liability and has certified its intention to 
     remand the removed action for the determination of damages. 
     An appeal with respect to the liability determination and the 
     choice of law determination of the district court may be 
     taken during that 60-day period to the court of appeals with 
     appellate jurisdiction over the district court. In the event 
     a party files such an appeal, the remand shall not be 
     effective until the appeal has been finally disposed of. Once 
     the remand has become effective, the liability determination 
     and the choice of law determination shall not be subject to 
     further review by appeal or otherwise.
       ``(4) Any decision under this subsection concerning remand 
     for the determination of damages shall not be reviewable by 
     appeal or otherwise.
       ``(5) An action removed under this subsection shall be 
     deemed to be an action under section 1369 and an action in 
     which jurisdiction is based on section 1368 of this title for 
     purposes of this section and sections 1407, 1660, 1697, and 
     1785 of this title.
       ``(6) Nothing in this subsection shall restrict the 
     authority of the district court to transfer or dismiss an 
     action on the ground of inconvenient forum.''.
       (e) Choice of Law.--
       (1) Determination by the court.--Chapter 111 of title 28, 
     United States Code, is amended by adding at the end the 
     following new section:

     ``Sec. 1660. Choice of law in multiparty, multiforum actions

       ``(a) Factors.--In an action which is or could have been 
     brought, in whole or in part, under section 1369 of this 
     title, the district court in which the action is brought or 
     to which it is removed shall determine the source of the 
     applicable substantive law, except that if an action is 
     transferred to another district court, the transferee court 
     shall determine the source of the applicable substantive law. 
     In making this determination, a district court shall not be 
     bound by the choice of law rules of any State, and the 
     factors that the court may consider in choosing the 
     applicable law include--
       ``(1) the place of the injury;
       ``(2) the place of the conduct causing the injury;
       ``(3) the principal places of business or domiciles of the 
     parties;
       ``(4) the danger of creating unnecessary incentives for 
     forum shopping; and
       ``(5) whether the choice of law would be reasonably 
     foreseeable to the parties.
     The factors set forth in paragraphs (1) through (5) shall be 
     evaluated according to their relative importance with respect 
     to the particular action. If good cause is shown in 
     exceptional cases, including constitutional reasons, the 
     court may allow the law of more than one State to be applied 
     with respect to a party, claim, or other element of an 
     action.
       ``(b) Order Designating Choice of Law.--The district court 
     making the determination under subsection (a) shall enter an 
     order designating the single jurisdiction whose substantive 
     law is to be applied in all other actions under section 1369 
     arising from the same accident as that giving rise to the 
     action in which the determination is made. The substantive 
     law of the designated jurisdiction shall be applied to the 
     parties and claims in all such actions before the court, and 
     to all other elements of each action, except where Federal 
     law applies or the order specifically provides for the 
     application of the law of another jurisdiction with respect 
     to a party, claim, or other element of an action.
       ``(c) Continuation of Choice of Law After Remand.--In an 
     action remanded to another district court or a State court 
     under section 1407(j)(1) or 1441(e)(2) of this title, the 
     district court's choice of law under subsection (b) shall 
     continue to apply.''.
       (2) Conforming amendment.--The table of sections at the 
     beginning of chapter 111 of title 28, United States Code, is 
     amended by adding at the end the following new item:

``1660. Choice of law in multiparty, multiforum actions.''.
       (f) Service of Process.--
       (1) Other than subpoenas.--(A) Chapter 113 of title 28, 
     United States Code, is amended by adding at the end the 
     following new section:

     ``Sec. 1697. Service in multiparty, multiforum actions

       ``When the jurisdiction of the district court is based in 
     whole or in part upon section 1369 of this title, process, 
     other than subpoenas, may be served at any place within the 
     United States, or anywhere outside the

[[Page H8108]]

     United States if otherwise permitted by law.''.
       (B) The table of sections at the beginning of chapter 113 
     of title 28, United States Code, is amended by adding at the 
     end the following new item:

``1697. Service in multiparty, multiforum actions.''.
       (2) Service of subpoenas.--(A) Chapter 117 of title 28, 
     United States Code, is amended by adding at the end the 
     following new section:

     ``Sec. 1785. Subpoenas in multiparty, multiforum actions

       ``When the jurisdiction of the district court is based in 
     whole or in part upon section 1369 of this title, a subpoena 
     for attendance at a hearing or trial may, if authorized by 
     the court upon motion for good cause shown, and upon such 
     terms and conditions as the court may impose, be served at 
     any place within the United States, or anywhere outside the 
     United States if otherwise permitted by law.''.
       (B) The table of sections at the beginning of chapter 117 
     of title 28, United States Code, is amended by adding at the 
     end the following new item:

``1785. Subpoenas in multiparty, multiforum actions.''.

     SEC. 4. EFFECTIVE DATE.

       (a) Section 2.--The amendments made by section 2 shall 
     apply to any civil action pending on or brought on or after 
     the date of the enactment of this Act.
       (b) Section 3.--The amendments made by section 3 shall 
     apply to a civil action if the accident giving rise to the 
     cause of action occurred on or after the 90th day after the 
     date of the enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
North Carolina (Mr. Coble) and the gentleman from California (Mr. 
Martinez) each will control 20 minutes.
  The Chair recognizes the gentleman from North Carolina (Mr. Coble).


                             General Leave

  Mr. COBLE. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
on the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from North Carolina?
  There was no objection.
  Mr. COBLE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise today, in support of H.R. 2112, the 
Multidistrict, Multiparty, Multiforum Trial Jurisdiction Act of 1999 
and urge the House to adopt the measure. This bill is authored by the 
gentleman from Wisconsin (Mr. Sensenbrenner).
  Section 2 of H.R. 2112 responds to a 1998 Supreme Court decision 
pertaining to multidistrict litigation, the so-called ``Lexecon'' case.
  Section 2 of the bill would simply amend the multidistrict litigation 
statute by explicitly allowing the transferee court to retain 
jurisdiction over referred cases for trial or refer them to other 
districts as it sees fit.
  This change, it seems to me, Mr. Speaker, makes sense in light of 
past judicial practice under the multidistrict litigation statute.
  In addition, section 3 of H.R. 2112 offers what I believe are modest 
but necessary improvements to a specific type of multidistrict 
litigation, that involving disasters such as an airline or train 
accident, in which several individuals from different States are killed 
or injured.
  Finally, I note that there is a technical error in the committee 
report. Pursuant to a change advocated by the gentleman from Michigan 
(Mr. Conyers), which we accepted at full committee markup, the dollar 
threshold for cases brought under section 3 was raised from a previous 
draft of $50,000 to $75,000. $75,000 is the correct figure.
  This legislation obviously promotes judicial administrative 
efficiency without compromising the rights of litigants and their 
counsel to due process and appropriate compensation. It is strongly 
endorsed by the Administrative Office of the United States Courts, and 
I urge my colleagues to support it as well.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MARTINEZ. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of the Multidistrict, Multiparty, 
Multiforum Trial Jurisdiction Act of 1999. I would like to thank, on 
behalf of the ranking member, the gentleman from Michigan (Mr. 
Conyers), the gentleman from North Carolina (Chairman Coble), and the 
gentleman from Wisconsin (Mr. Sensenbrenner) of the Subcommittee on 
Courts and Intellectual Property for their hard work on this bill and 
for the bipartisan fashion in which they operated.
  Mr. Speaker, I reserve the balance of my time.
  Mr. COBLE. Mr. Speaker, I thank the gentleman from California (Mr. 
Martinez) for his generous remarks.
  Mr. Speaker, I yield such time as he may consume to the gentleman 
from Wisconsin (Mr. Sensenbrenner), the sponsor of the bill
  Mr. SENSENBRENNER. Mr. Speaker, H.R. 2112 is a combination of two 
other freestanding bills which I have introduced. Section 2 consists of 
the text of H.R. 1852, which would reverse the effects of the 1998 
Supreme Court decision in the so-called ``Lexecon'' case, that would 
simply amend the multidistrict litigation statute by explicitly 
allowing a transferee court to retain jurisdiction over referred cases 
for trial or to refer them to other districts as it sees fit.
  Section 3 is comprised of the language of H.R. 967, which beginning 
in the 101st Congress has been supported by the Department of Justice, 
the Administrative Office of the U.S. Courts, two previous Democratic 
Congresses, and one previous Republican Congress.
  Section 3 will help reduce litigation costs as well as the likelihood 
of forum shopping in single-accident mass tort cases. All plaintiffs in 
these cases would ordinarily be situated identically, making the case 
for consolidation of these actions especially compelling. These types 
of disasters, with their hundreds of thousands of plaintiffs and 
numerous defendants, have the potential to impair the orderly 
administration of justice in the Federal courts for an extended period 
of time.
  In brief, section 3 addresses these problems by conferring original 
jurisdiction upon a Federal District Court of any civil action which 
features four basic attributes. First, the action is one in which 
minimal diversity exists between adverse parties. Second, the action 
arises from a single accident. Third, at least 25 people have either 
died or incurred injury in the accident. Fourth, in the case of injury, 
the injury has resulted in damages which exceed $75,000 per person.
  Moreover, the relevant district court overseeing such a consolidated 
action is given wider authority to apply appropriate choice of law 
rules. This is a great improvement over the existing convoluted system 
in which a myriad of State laws ties the hands of a federal judge. The 
criteria the Court must invoke when making its decisions include 
examination of the place of the injury, the place of the conduct 
causing the injury, the principal place of business or domicile of the 
parties, the danger of creating unnecessary incentives for forum 
shopping and whether the choice of law would be reasonably foreseeable 
to the parties.
  In addition, Mr. Speaker, the gentleman from California (Mr. Berman) 
and I jointly amended the bill at full committee by making two basic 
and noncontroversial changes.
  First, the treatment of compensatory damages in Section 2 will be 
made consistent with that in section 3.
  Second, based upon a recommendation from the gentleman from Michigan 
(Mr. Conyers), we will raise the dollar threshold in section 3 actions 
from $50,000 to $75,000.
  Finally, Mr. Speaker, I wish to acknowledge the good faith efforts of 
the gentleman from California (Mr. Berman) in resolving the one 
outstanding issue governing compensatory damages prior to the full 
committee markup. His willingness to work with us has resulted in a 
truly bipartisan and noncontroversial measure. I want these sentiments 
on the record, especially in his absence today.
  So, Mr. Speaker, this 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 
join the gentleman from California (Mr. Berman) and myself in a 
bipartisan effort to support the Multidistrict, Multiparty, Multiforum 
Jurisdiction Act of 1999.
  Mr. CONYERS. Mr. Speaker, I rise today in support of the 
``Multidistrict, Multiparty, Multiforum Jurisdiction Act of 1999.'' I'd 
like to begin by expressing thanks to Chairman Coble and Representative 
Sensenbrenner of the Intellectual Property and Courts Subcommittee for 
their hard work and dedication to working out the concerns that we 
raised with respect to the original version of the bill in a truly 
bipartisan fashion.

[[Page H8109]]

  I. Section 2--Overturns Lexecon v. Milberg Weiss, 523 U.S. 26 (1998)

  Section 2 of the bill overturns the recent Supreme Court decision of 
Lexecon V. Milberg Weiss, where the Supreme Court held that a 
transferee court (a district court assigned to hear pretrial matters by 
a multidistrict litigation panel in multidistrict litigation cases) 
must remand all cases back for trial to the districts in which they 
were originally filed, regardless of the views of the parties.
  It is my understanding from the hearing that for some 30 year the 
transferee court often retained jurisdiction over all of the suits by 
invoking a venue provision of Title 28, allowing a district court to 
transfer a civil action to any other district where it may have been 
brought--in effect, the transferee court simply transferred all of the 
cases to itself. The Judicial Conference testified that this process 
has worked well, and as a matter of judicial expedience, I support 
overturning the Lexecon decision.
  There was a concern raised at the Subcommittee hearing, however, that 
Section 2, as originally drafted, would have gone far beyond simply 
permitting a multidistrict litigation transferee court to conduct a 
liability trial, and instead, would have allowed the court to also 
determine compensatory and punitive damages. The concern here is that 
trying the case in the transferee forum could be extremely inconvenient 
for plaintiffs who would need to testify at the damages phase of the 
trial.
  As a result of discussions between the minority and majority, 
Representative Berman successfully offered a bipartisan amendment 
addressing this concern at the Full Committee markup. Pursuant to this 
amendment, Section 2 now creates a presumption that the trial of 
compensatory damages will be remanded to the original district court.


  ii. section 3--minimal diversity for single accidents involving 25 
                                 people

  Section 3 of the bill expands federal court jurisdiction for single 
accidents involving at least 25 people having damages in excess of 
$75,000 per claim and establishes new federal procedures in these 
narrowly defined cases for selection of venue, service of process, 
issuance of subpoenas and choice of law. It is my understanding here 
that mass tort injuries that involve the same injury over and over 
again such as asbestos and breast implants, etc., would be excluded. 
And that the types of cases that would be included would be plane, 
train, bus, boat accidents, environment spills, etc.--many of which may 
already be brought in federal court.
  While I traditionally oppose having federal courts decide state tort 
issues, and disfavor the expansion of the jurisdiction of the already-
overloaded district courts, unlike the broader class action bill (H.R. 
1875), this bill would only expand federal court jurisdiction in a much 
narrower class of actions, with the objective of judicial expedience.
  Thus, I support this Section with the understanding that it would 
only apply to a very narrowly defined category of cases and does not in 
any way serve as a precedent for broader expansion of diversity 
jurisdiction.
  Mr. MARTINEZ. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  Mr. COBLE. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from North Carolina (Mr. Coble) that the House suspend the 
rules and pass the bill, H.R. 2112, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________