Policing MDL Non-Class Settlements: Empowering Judges Through the All Writs Act

Abstract

Commentators have identified that one of the most significant problems in current MDL practice is the lack of judicial authority over non-class aggregate settlements. This paper explores the use of the All Writs Act to provide MDL judges with robust authority to manage, supervise, and ultimately review non-class aggregate deals that are the object of much recent criticism. It rejects the thesis that judicial supervision of non-class settlements is unwarranted because these deals are contractual, and that oversight therefore removes claimant autonomy and damages the adversarial system. Several MDL judges already have invoked the All Writs Act to police parallel class action settlements that might jeopardize pending MDL negotiations. This paper explores and endorses the argument that MDL judges may, with equal force, exercise power pursuant to the All Writs Act to police pending non-class settlements in their jurisdiction. As the MDL non-class settlement paradigm has evolved, some MDL judges have sought to intervene in settlement activities by invoking authority pursuant to three theories: (1) the quasi class action, (2) the inherent powers of the court, and (3) the All Writs Act. As critics note, the quasi class action and inherent judicial power have provided weak support for judicial intervention in non-class aggregate settlements. But to date, commentators have paid scant attention to judicial power under the All Writs Act or its use in MDL proceedings. The explosion of the MDL docket in the twenty-first century represents the most notable paradigm shift in the American legal landscape in several decades. Currently, the MDL panel assumes jurisdiction over almost all emerging aggregate mass tort and small claims consumer actions. With this marked proliferation of MDL proceedings, commentators have signaled various growing concerns with the MDL resolution of large-scale collective disputes. In particular, critics have focused on issues relating to non-class aggregate settlements accomplished under MDL auspices. The MDL statute provides judges with authority to supervise and manage coordinated pre-trial proceedings, but little else. Historically, MDL proceedings have proven effective vehicles for resolving mass disputes through class action settlements, subject to Rule 23 requirements and constraints. Currently, however, attorneys have pivoted to resolving aggregate disputes through non-class settlements that are negotiated and consummated outside class action procedures, which relieves parties of Rule 23 judicial supervision, oversight, and review. The MDL statute provides scant authority for judicial oversight of non-class aggregate settlements. This shift to non-class settlements has inspired concern regarding the substantive, procedural, and ethical dimensions of these deals. A major debate centers on the question of judicial authority in the non-class settlement arena and this paper seeks to provide that authority by focusing on judicial power under the All Writs Act.