Summary
listing factors to be considered in exercising this discretion
Summary of this case from Scott ex rel. J.S. v. Ruston La. Hosp. Co.Opinion
CIVIL ACTION NO: 00-0779 SECTION: "D" (3).
April 19, 2000.
April 20, 2000.
Before the court are the following motions:
(1) " Motion to Remand" filed by Plaintiffs and opposed by Defendant Microsoft; and
(2) " Motion to Stay All proceedings Until the MDL Panel Rules on Motions to Transfer this and Other Actions Pursuant to 28 U.S.C. § 1407 " filed by Defendant and opposed by Plaintiffs.
The motions, set for hearing on April 19, 2000, are before the court on briefs without oral argument. Having considered the memoranda of counsel and the applicable law, the court now rules.
BACKGROUND
The instant action is one of many cases filed against Microsoft after findings of fact were issued in United States v. Microsoft on November 5, 1999. Currently, there are motions by several parties in these cases pending before the Judicial Panel on Multidistrict Litigation ("JPML") for consolidation of all cases against Microsoft.
The Defendant requests that this court exercise its discretion and stay pretrial proceedings, including determinations of jurisdictional issues, pending a determination by the JPML. Plaintiffs oppose the motion, and urge this court to deny the stay, determine that jurisdiction is lacking and remand the case to state court.
ANALYSIS
The JPML is established under 28 U.S.C. § 1407. The purpose of this statute is to permit the centralization in one district of all pretrial proceedings in civil actions involving one or more common questions of fact pending in different districts. Further, the statute seeks to eliminate potential conflicting rulings by coordinate district and appellate judges.
Matter of New York City Mun. Securities Litigation, 572 F.2d 49, 51-52 (2nd Cir. 1978).
In re Air Crash Disaster off Long Island, N.Y. on July 17, 1996, 965 F. Supp. 5, 7 (S.D.N.Y. 1997).
A pending motion before the JPML does not affect the jurisdiction of the transferor court. However, courts have inherent power to "control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants."
In re Air Crash Disaster at Paris, France on March 3, 1974, 376 F. Supp. 887, 888 (J.P.M.L. 1974).
Landis v. North American Co., 57 S.Ct. 163, 166 (1936).
Plaintiffs assert that this court lacks subject matter jurisdiction and that jurisdictional issues should be resolved prior to any other action. While generally true, cases such as this require special consideration.
As stated previously, the purpose of the JPML is to promote judicial economy and to prevent inconsistent rulings. This case presents questions of fact similar to the other actions pending before the JPML. Additionally, the same jurisdictional question raised in this case has been raised before this court in another case against Microsoft, and will likely be raised in many of the other cases pending against Microsoft in other districts.
In support of their opposition, plaintiffs have included a letter from the JPML to Judge Fallon regarding Tramonte v. Chrysler Corp. where a motion to transfer was pending before the JPML and a motion to remand was pending before Judge Fallon. Plaintiffs quote a sentence from the letter which states "In the Panel's experience, such motions to remand to state court often involve questions unique to an action that are well suited for decisions prior to the 1407 transfer." While in Tramonte there were unique questions to be considered regarding jurisdiction, this is not the case here. As previously stated, this exact issue was presented to this court in another action against Microsoft, and will surely be an issue in many of the other cases pending against Microsoft in other districts.
Civil Action No. 95-2109 (E.D, La. June 28, 1999).
Plaintiffs also cite Panama v. American Tobacco Co., in support of their position, and assert that "the facts of this case closely mirror those in Panama." Plaintiffs' reliance onPanama is misplaced. Procedurally, the two cases are similar in that defendants in both cases filed motions to stay pending a decision by the JPML, and plaintiffs in both cases filed motions to remand. However, the court in Panama noted that not all defendants joined in the motion to transfer and consolidate with the JPML and that there was the likelihood that the JPML "may not accept this case."
1999 WL 350030 (E.D. La. 1999).
Id. at n 2.
Plaintiffs assert that the JPML "does not have the power to consider the propriety of coordinated or consolidated pretrial proceedings in state court actions." However, once removed, federal courts have jurisdiction to determine jurisdiction, the JPML has the power to transfer cases with motions to remand pending, and the district courts have discretion to stay actions pending decisions of the JPML even where jurisdictional questions exist.
See Plaintiffs' Memorandum in Opposition at p. 5.
The Second Circuit determined that the JPML does have jurisdiction to transfer a case even where a jurisdictional objection is pending. In Weinke v. Microsoft, this same issue was presented to the district court. In that case, the court exercised its jurisdiction and stayed the action pending a decision by the JPML.
See In re Ivy, 901 F.2d 7, 9 (2d Cir. 1990).
2000 WL 220496 (E.D. Wis. 1999).
In Boudreaux v. Metropolitan Life Ins. Co., the court stated that "[t]he transferee judge `certainly has the power to determine the question of remand,' and if remand issues are common to many of [these cases], decisions by the transferee judge would avoid `duplicative discovery and conflicting pretrial rulings.'" Other cases have come to this same conclusion.
1995 WL 83788 at *2, (ED. La. 1995) (quoting In re Air Crash Disaster at Florida, 368 F. Supp. 812, 813 (J.P.M.L. 1973)).
In re Professional Hockey Antitrust Litigation, 369 F. Supp. 1117, 1118 (J.P.M.L. 1974); In re Air Crash Disaster at Juneau Alaska, 360 F. Supp. 1406 (J.P.M.L. 1973).
In all of these cases the courts determined that consistency and economy would be served by resolution of these issues by a single court after transfer by the JPML. The same is true in this case. In the event that the Panel determines that consolidation of these cases is not warranted, Plaintiff may re-urge the motion.
Courts consider the following factors in deciding whether a stay of the proceedings is appropriate: 1) hardship and inequity on the moving party without a stay; 2) prejudice the non-moving party will suffer if a stay is granted; and 3) judicial economy.
See Rivers v. Walt Disney Co., 980 F. Supp. 1358, 1360 (C.D. Cal. 1997); See generally Arthur-Magna, Inc. v. Del-Val Financial Corp., 1991 WL 13725 (D.N.J. 1991); Boudreaux v. Metropolitan Life Ins. Co., 1995 WL 83788 (E.D. La. 1995).
First, Microsoft would suffer a considerable hardship and inequity if forced to simultaneously litigate multiple suits in multiple courts. Further, they could potentially suffer conflicting rulings by different judges in these multiple suits. Second, plaintiffs have failed to show any significant prejudice they would suffer, beyond the slight delay pending the JPML decision. Finally, the interests of judicial economy would best be served by granting a stay.
Accordingly;
IT IS ORDERED that further proceedings in this case are STAYED pending the decision on consolidation and transfer by the JPML.
IT IS FURTHER ORDERED that Plaintiffs' Motion to Remand is DENIED at this time and may be re-urged if necessary after the decision of the JPML.