The Judicial Panel on Multidistrict Litigation lives mainly to decide whether to group cases from around the country into big mega-cases for pretrial work — motions to dismiss, discovery, summary judgment motions — and, if so, which district judge to send each of the mega-cases to.

But what happens when the "transferee" judge finishes the pretrial work? Does she make rulings (partial final judgments under Rule 54(b)) that would allow all the cases to go up on appeal to the same court of appeals at the same time? Or does she simply send the cases that survived summary judgment back to the "transferor" courts in other court of appeals circuits and let the appeals from the ones that died a pretrial death go to a different court of appeals?

The Seventh Circuit held that the issue could've gone either way and that, because the transferee judge and the MDL Panel therefore had discretion on which way to go, Their Honors wouldn't second-guess their decision to remand. FedEx Ground Package Sys., Inc. v. U.S. Judicial Panel on Multidistrict Litig., No. 11-2438 (7th Cir. Nov. 17, 2011).

The case, by the way, concerned claims by FedEx delivery people that FedEx wrongfully failed to treat them as employees instead of independent contractors under applicable state law.

Suppose you took out loans to help pay the costs of running your business. You later suffer some setbacks. Bad ones. The market price of the loans, and their value on your lenders' books, take a tumble. In a fair world, those who made the loans would gladly let you pay off the debt at a discount, right?

But you don't live in that world. You abide in one where lenders make bad choices, do things out of spite, or just don't care. Your world also has in it lenders — your lenders — who think that, if they join in a boycott against your offer to pay off your debt for cheap, they can squeeze more out of you. And they try that very thing.

You don't like it one bit. Your lawyer thinks you could sue the lenders under section 1 of the Sherman Act on a theory of group boycott, and you do.

Do you win? No. CompuCredit Holding Corp. v. Akanthos Capital Mgmt. LLC, No. 11-13254 (11th Cir. Nov. 10, 2011) (holding that existing relationship between borrower and lenders precluded antitrust claim).

The panel noted that the two Supreme Court cases that CompuCredit cited didn't involve lenders' butting heads with their borrower over repaying the loan and that the Second and Seventh Circuit had rejected claims just like CompuCredit's.

The Ninth Circuit today upheld an order that granted class status to a federal securities fraud case against Amgen. Connecticut Retirement Plans and Trust Funds v. Amgen Inc., No. 09-56965 (9th Cir. Oct. 8, 2011).

The panel gave the back of its hand to Amgen's jutting chin of a point — that the class couldn't prove the materiality element of a claim under Rule 10b-5. Their honors ruled that simply pleading (a la Twombly) a plausible basis for the materiality of Amgen's false statements and omissions suffices at the class cert. stage. Proof of materiality need not come until later (at summary judgment and trial).

Blawgletter finds the panel's views quite sound. We hope to see more courts approach the question of which elements class plaintiffs must present proof of under Rule 23 with a like clearness.

As our oil-and-gas trial prepares to drill into day eight, Blawgletter pauses to reflect on events outside DeRidder, Louisiana, the charming and friendly seat of Beauregard Parish.

The news that most caught our eye involves the case that took our breath away in law school more than any other — Wickard v. Filburn, 317 U.S. 111 (1942).

Today, a panel of the D.C. Circuit voted 2-1 to uphold the Patient Protection and Affordable Care Act against a constitutional attack, one that argued that the Commerce Clause in the U.S. Constitution could not and did not empower the federal government to fine citizens for not doing something (in this case, buying health insurance).

The majority relied a lot on Wickard, which concerned a wheat farmer who contested a New Deal era law that forbade him from growing wheat — even if he didn't sell any of it and instead consumed it all right there on his very own farm. The ruling took our breath away because it seemed to leave almost nothing outside the power of Congress to legislate on.

We invite you to read the opinion, which bears the firm imprint of its clever author, Senior Circuit Judge Silberman. Seven-Sky v. Holder, No. 11-5047 (D.C. Cir. Nov. 8, 2011).

What do you do if you paid a bunch of money to settle a class action but some of the class members who didn't opt out demand that you arbitrate a dispute relating, at least in part, to the subject matter of the claims you settled?

You start by asking the arbitrators to stay their hand, but when they refuse you run to a court — the Southern District of New York, in this case. What do you ask for? An injunction, of course.

Can you get one? Yes, the Second Circuit ruled a day ago in Ameriprise Financial Services, Inc. v. Beland, No. 10-3399, slip op. at 53-58 (2d Cir. Nov. 3, 2011).

The panel also dealt with questions about the scope of the release in the class settlement papers. It held that the Belands had lost most of their claims because they fell within the class release but that the couple didn't forfeit a "suitability" claim, which (in the panel's view) didn't relate to the "common course of conduct" — the key words in the release — at issue in the class case.

Blawgletter notes something the court did not do — it did not speak to the issue of whether making someone arbitrate a claim she didn't agree to arbitrate causes her "irreparable harm", a key element of a request for an injunction pending trial on the merits. Did Their Honors think the question obvious?

A case that we've handled over the last few months suggests that the answer, while not obvious, does seem fairly clear. As the Delaware Court of Chancery ruled (in our clients' favor):

The parties negotiated and agreed to a broad forum selection clause that anticipated that any litigation arising from the Agreements would occur exclusively in Delaware. If Plaintiffs are forced to prosecute an claims falling within that clause in a different forum, they will be deprivated irreparably of the benefit of that bargain, regardless of whether they later prevail on the merits of that action. This Court has consistently held that the processio of a claim in an unwarranted forum poses a threat of irreparable harm warranting a preliminary injunction. To hold otherwise in the cirumstances of this case would render the broad language of the forum selection clause meaningless and deprive Plaintiffs of the benefit of their bargain.

ASDC Holdings, Inc. v. Richard J. Malouf 2008 All Smiles Grantor Retained Annuity Trust, 2011 WL 4552508, at *8 (Del. Ch. Sept. 14, 2011).

As Blawgletter gets ready for a trial that starts Monday, with a glad and grateful heart we welcome our friend, former team-mate, and world class i-banker (at BDO Capital) Jeffrey R. Manning as guest poster.

Jeff always has something well worth hearing to say. He also has, in the realm of humor, what the French call "I don't know what".

Today, Jeff regales us with his take on Stern v. Marshall (post here) and wonders What It All Means. Here you go:

Disclosure:  While not an attorney, twice in 30 years as an investment banker I received the “I’m not an attorney BUT… Award” at the closing dinner, and it is my distinct pleasure to regularly spend many waking hours around members of the bankruptcy bar.

For decades, bankruptcy judges have steadily labored on in relative obscurity pulling and pushing debtors through the process of the U.S. Bankruptcy Code, and these men and women deserve much credit for enhancing capital markets with a relatively efficient process to deal with default and disappointment; especially compared to “debtor’s prison” approaches around the globe.  I have witnessed “final” sale orders resolving troubling environmental and product liability issues, complicated tax matters, and labor strife with the power of the judge’s signature, as assets were released “free and clear of liens, claims and encumbrances” to a good faith buyer.  Despite the relative obscurity, in this court of equity bankruptcy judges wielded enormous power.

Perhaps no longer, after the U.S. Supreme Court’s groundbreaker in Stern v. Marshall, Case No. 10-179 2011 WL 2472792 (June 23, 2011). In a 5-4 opinion written by Chief Justice John Roberts, the court affirmed the 2010 ruling by the U.S. Court of Appeals for the Ninth Circuit and held that the bankruptcy court did not have constitutional authority to decide a state law claim brought by a debtor against a creditor, even though the matter was part of the “core” statutory jurisdiction of the bankruptcy court.

The case was highly visible, so to speak, as Ms. Vickie Lynn Marshall is best known as the 1993 Playmate of the Year, Anna Nicole Smith, and she brought suit against her late husband’s son, Pierce Marshall – salacious stuff, this. 

However unknown, the impact on the daily grinding work of the bankruptcy bar has been jolted by this Constitutional challenge.  As an adjunct of the U.S. District Court, can a bankruptcy court issue such a thing as a “final” order?  Since Stern was decided, courts have issued more than 70 published and unpublished rulings that cite to it.  Where do we go from here, as judges evaluate this new challenge to their authority?  It will take many billable hours to sort out.

Blawgletter likes choice of forum clauses in contracts. We think parties to pacts will do themselves a favor if they provide in advance for where they'll sort out any fights over what they agreed to. And, while we admire those who make the effort, we wonder why they so often do a poor better job of it.

Take the case of Global Seafood Inc. v. Bantry Bay Mussels Ltd., No. 08-1358-cv (2d Cir. Oct. 20, 2011). Global claimed Bantry Bay (which seems to take its name from a lovely place in County Cork) broke its promise to sell mussels in the U.S. only through Global. Bantry Bay said the "Heads of Agreement" counted for naught under the laws of Ireland, BB's home country. But the HOA did say that "[t]his Agreement is governed by Irish Law and the Irish Courts".

The district court threw out Global's case on the ground that "governed by . . . the Irish Courts" meant that non-Irish courts couldn't hear a dispute that dealt with the HOA. The Second Circuit said no to that.

We do not . . . share the district court’s view that the term “govern”—standing alone—imparts a clear and unambiguous intent by the parties to confer exclusive jurisdiction on Irish Courts or to select Ireland as the obligatory venue.  While “govern” indicates an intent to confer upon the Irish Courts the power and authority to hear disputes arising out of the Heads of Agreement, it does not, without more, purport to do so to the exclusion of other courts where jurisdiction may also lie.  Unlike the mandatory clause in Phillips, “governed” is not accompanied by a phrase analogous to “are to be brought,” i.e., specific language that actively channels the suit to a particular court, which would indicate an intent to make the Irish Courts the only courts that can govern disputes arising out of the Heads of Agreement.

Id. at 8-9 (emphasis in original).

 

It turns out, for example, that men with low-pitched voices have more than the usual amount of testosterone, which makes them unusually assertive.  No surprise that trial lawyers, who make their living by locking verbal horns in front of spectators, have 30 percent more testosterone than other lawyers.

John L. Locke,"Why Do Men and Women Talk Differently?", WSJ Speakeasy, Oct. 19, 2011.