[Congressional Record (Bound Edition), Volume 145 (1999), Part 7]
[Extensions of Remarks]
[Page 10015]
[From the U.S. Government Publishing Office, www.gpo.gov]



            THE MULTIDISTRICT TRIAL JURISDICTION ACT OF 1999

                                 ______
                                 

                    HON. F. JAMES SENSENBRENNER, JR.

                              of wisconsin

                    in the house of representatives

                         Tuesday, May 18, 1999

  Mr. SENSENBRENNER. Mr. Speaker, today I am introducing the 
Multidistrict Trial Jurisdiction Act of 1999 at the behest of the 
Administrative Office of the U.S. Courts (or ``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 districts 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 1404 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, this legislation responds to Justice Souter's 
admonition. My bill 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 under the 
Multidistrict Litigation statute. It obviously promotes judicial 
administrative efficiency. I therefore urge my colleagues to support 
the Multidistrict Trial Jurisdiction Act of 1999.

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