An alternative approach: multi-district litigation in the U.S.
There is a misconception that class actions are available for nearly any legal claim involving thousands of potential claimants. That is not the case. In the United States, there remain many claims that are not readily certified as class actions, primarily because there are unique individual issues, like bodily injury claims, that make the class action device ill-suited as a procedural mechanism. In these cases, plaintiffs pursue thousands or tens of thousands of individuals claims as “mass torts”. In order to better manage these cases, mass torts are often consolidated in Multi-District Litigation (“MDL”): a process by which multiple federal cases are consolidated by the Judicial Panel on Multi-District Litigation, and then tried as an aggregate.
Like the class action mechanism in the United States, MDL has the potential to more efficiently address claims in a consolidated proceeding before a single court. While MDL litigation has been the subject of intense academic criticism for fostering the filing of frivolous claims without a mechanism to evaluate and/or dismiss weak claims, MDL litigation does provide another mechanism to achieve settlement of thousands of mass tort claims. Unlike with class action mechanisms, court settlement approval is not required. However—or perhaps as a result—parties often file a motion to request court enforcement of the settlement to which the parties agreed.
In this regard the settlement of mass tort claims in the US is similar to schemes of redress in the UK.
Several high-profile cases in the US have resolved via settlement after having commenced the MDL process. For example: the Deepwater Horizon Settlement, and the Volkswagen “Clean Diesel” Settlement. In both instances, claimants were scattered across many jurisdictions, and individual proceedings would have overwhelmed the federal courts.
While not universally embraced across the United States, some courts have embraced the Bellwether trial to expedite multi-district proceedings. Akin to “test claims” in the UK, parties (with the assistance of the courts) will select a sample case–or a set of sample cases—to try before a court. The results of these trials then operate as a basis by which to settle or otherwise resolve the remaining controversies. While controversial, the Bellwether trial offers counsel a sort of “experimental lab” in which to test multiple theories of their case in front of several different juries. What’s more, the information gained from a Bellwether trial may inform parties as to the appropriate settlement amount (or whether the parties wish to settle at all). Test cases have the primary benefit of helping the parties “value” the claims for purposes of arriving at a fair settlement. Court approval of a settlement in a Bellwether trial is not required.