Mass Torts in a World of Settlement.

• Author: Sebok, Anthony J.
• Position: Book review

MASS TORTS IN A WORLD OF SETTLEMENT. By Richard A. Nagareda. Chicago and London: University of Chicago Press. 2007. Pp. xx, 324. $49.

INTRODUCTION

Twenty years ago, Deborah Hensler and a team of scholars at the RAND Corporation's Institute for Civil Justice issued a report entitled Trends in Tort Litigation: The Story Behind the Statistics. (1) Pressure had been mounting both in the business community and the Republican Party to "reform" tort law throughout the 1980s. (2) There was concern that Americans "egged on by avaricious lawyers, sue[d] too readily, and irresponsible juries and activist judges wayla[id] blameless businesses at enormous cost to social and economic well-being." (3)

The RAND report argued that the real risk of a torts "explosion" came from the world of mass torts. (4) The report's authors presciently focused on asbestos and the Dalkon Shield litigation, citing these as examples of how mass latent injury suits represented a new challenge to the tort system. (5) The study concluded that "[m]ass latent injury torts are the most volatile world of tort litigation. Costs, dynamic legal environment, and the uncomfortable fit between these cases and the tort system conspire to make the number, outcome, and future costs of these suits highly uncertain." (6)

Since these words have been written, the world of mass torts has remained much the same. Asbestos suits continue to be filed, now numbering in the hundreds of thousands. Settlements in asbestos, Dalkon Shield, and silicone breast implants have led to the bankruptcy of many major corporations. Mass tort claims have been crafted to deal with a series of potentially damaging social phenomena, including cigarettes, handguns, and fast food. The class action bar is now seen as a powerful force in American politics. Federal tort reform designed specially against it, the Class Action Fairness Act of 2005, was passed by Congress just before the midterm elections of 2006. (7)

The "volatile world" of mass torts has also spawned a cottage industry of academic scholarship. Most scholarship approaches mass torts from one of three perspectives: procedure, substance, or ethics. Proceduralists look at mass torts as an artifact of a revolution in civil procedure effected through the evolution of Rule 23 of the Federal Rules of Civil Procedure, Rule 23's state law equivalents, and the emergence of certain practices such as multi-district litigation in the federal system and liberal rules of aggregation in state systems. (8) Others see mass torts as a reflection of changes in substantive tort law, such as the emergence of new claims for emotional distress without physical injury. (9) Finally, there are those who see the evolution of mass torts as a story of a change--if not a knowing abandonment--of the principles of legal ethics as well as, at its worst, a corruption of the bar's most basic commitment to honesty in its dealings with the courts and its clients' opponents. (10)

Richard Nagareda has tried to transcend these categories. Mass Torts in a World of Settlement is based, in part, on a series of articles he has published on specific topics in the field of mass torts. The book comprehensively presents Nagareda's argument for taking the problem of mass torts out of the familiar framework of procedure, substance, and ethics. Instead, Nagareda grounds mass torts in "administration"--a view that the private rights of clients can be unilaterally altered by someone else under the right conditions. Furthermore, administration is at the heart of Nagareda's proposal to harness the self-interest of lawyers to prevent mass torts from falling into dysfunctional settlement patterns that secure neither the legal rights of their clients nor society's larger shared interests. An administrative agency would monitor the fees earned by lawyers from their clients and redistribute some fees to non-clients. The proposal represents a natural but critical final step in Nagareda's academic journey since his earliest article on mass torts in 1996. (11)

Nagareda's project has always been normative, although he has also always been cautious never to oversell his ability to find a solution to a problem that some might consider insoluble. The book reveals Nagareda's normative drive and natural caution. In the Introduction, he states that "the evolving response of the legal system to mass torts has been to shift from tort to administration" (p. viii). The distinction between tort, which values client autonomy, and administration, which maximizes social welfare, sets up Nagareda's normative claim: the shift from tort to administration in mass torts reflects administration's ability to maximize recovery of the social goods that mass tort litigation is intended to provide. Nagareda argues that most commentators today assume that since "autonomy remains the norm and coercion the deviation," mass tort practices should endeavor to minimize coercion, and accept it as a regrettable shortcoming of the law--excusable, but never justified (p. 233). According to Nagareda, a close study of the real world of mass torts shows us that the truth is just the opposite: in mass torts, individual autonomy should be the exception and coercion the norm (p. 234). Understood as "peacemaking," coercion by administration is not to be regretted but perfected, so that it provides the social ends sought by mass torts with minimum dysfunction (p. 235).

Part I will review the structure and content of the book's argument. It will suggest that the structure adopted by Nagareda--in which he sets out a series of examples of the dysfunctions of mass torts, and only at the end of the book offers his solution to the problem illustrated by the examples--makes it hard for the reader to evaluate the book's overall theory. The solution is complex, with a number of moving parts, and it is not clear how it would make a difference in each of the dysfunctional episodes depicted. Part II will identify the strengths of the reform that forms the last two chapters of the book. It will argue that the chief virtue of Nagareda's proposal is that it "leverage[s] conflicts of interest" among plaintiffs' lawyers in class actions (p. 221). It would solve the problem of fairness in class settlement between present and future plaintiffs identified by the Supreme Court in Amchem Products, Inc. v. Windsor (12) and Ortiz v. Fibreboard Corp., (13) the two cases that made the fair resolution of conflicts between present and future plaintiffs in a mass tort the sine qua non of due process under Rule 23. Part III will argue that the problem with the solution proposed by Nagareda is that it only solves the problem identified by the Supreme Court in Amchem and Ortiz. The dysfunctions identified by Nagareda in Chapters Two through Ten are not all rooted in the problems identified by the Supreme Court in Amchem and Ortiz. Neither were tort-reform criticisms based on concern that one set of plaintiffs were being treated unfairly in settlement vis-a-vis another set. Nagareda's proposal must be judged not just by whether it solves the "local" problem in mass torts that it sets for itself, but by whether Nagareda has marginalized or ignored other issues that must be addressed if the institution of mass torts litigation is to enjoy widespread support among both American lawyers and American society.

1. THE STRUCTURE OF MASS TORTS IN A WORLD OF SETTLEMENT

   Nagareda's definition of a mass tort tracks the definition that RAND adopted in 1987. Like RAND, Nagareda focuses not only on the numerosity of a mass tort but also on the absence and presence of homogeneity along different axes within the class of affected persons. These axes include factual similarity, geography, and time. Mass torts are more homogeneous than masses of car accidents or medical misadventures because classes of victims share a common factual pattern--if nothing else, a common source of injury (pp. xii-xiii). Geography can play a more complex role in mass torts. As Nagareda notes, while some mass torts may still arise from a single, geographically bounded catastrophic event, many now arise as a result of the national distribution of products. This raises the question whether similar suits--with similar factual predicates and against one or few defendants--should be consolidated into a single forum, either for the sake of efficiency of adjudication or to promote settlement (p. xiv). Finally, unlike torts arising from single accidents, the temporal dispersal of the injuries--both in when they were suffered and when they manifest themselves--is a very important axis and one which will be discussed in much greater detail below.

   It must be noted that, however, that Nagareda's definition of "mass torts" includes only personal injury claims (pp. xii-xiii). Although he discusses securities fraud early in the book, it is only to develop the definition of mass tort by contrast (p. 2). Limiting the definition this way has upsides and downsides. But it should be noted what is lost and gained by this definitional maneuver. What is gained is the emphasis on the saliency of temporal dispersion. Once the set of mass torts under study excludes financial injury claims, the dysfunctions that are introduced by temporal dispersion--most notably the potential conflict between current and future injured parties-become clear. But the "physical-injury only" definition also means that Nagareda's solution may not address the problems associated with financial injury torts affecting highly numerous and geographically dispersed groups of victims. This lack of engagement with the problem of mass tort reform, as it is defined by others, limits the utility of Nagareda's work in influencing the debate over that reform. (14)

   1. Temporal Dispersal and Mass Torts

      With that caveat in mind, we can begin to examine the dysfunctions that Nagareda identifies in mass tort cases. The axis that seems most to separate mass...