A Federal Tête-à-Tête? The Multiparty, Multiforum Trial Jurisdiction Act and Hurricane Katrina: Past, Present, and Future Considerations

• Author: Joshua A. DeCuir
• Pages: 681-714

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The author wishes to express a word of gratitude to Mr. Alston Johnson who graciously advised the writing of this paper. A lawyer's lawyer and a consummate scholar--he is a teacher in every way.

TÍte-à-TÍte:

1. Together without the presence of a third person; face to face. Or

2. A private conversation between two persons.¹

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I Introduction

The story of Hurricane Katrina is well-immersed in the collective experience of most Americans, especially citizens in the states directly affected by the storm's rampage. Almost every aspect of this story has been analyzed and re-analyzed. The short- and long-term consequences of the storm have been the subject of seemingly endless prognostication. The failure of government at all levels to prepare for and to respond to the storm's tragedy has been replayed by analysts for over two years. The response of the judicial branch, however, has been a neglected aspect of this story. The courts are today bearing the brunt of the storm's lasting impact, and their response is of enormous consequence not only for the parties to pending suits, but for wider efforts at rebuilding. The judicial response also provides a bellwether for recent congressional efforts to use federal court jurisdiction as a remedy for long-standing problems with so-called "complex litigation" involving multiple lawsuits filed in multiple courts following an event.

A host of lawsuits were filed in various courts across Louisiana following the storm. Defendants, mostly insurance companies, began to invoke federal jurisdiction under a statute Congress passed in 2002 called the Multiparty, Multiforum Trial Jurisdiction Act ("MMTJA").² The statute was the fruition of almost three decades of attempts to remedy a particular set of problems with situations like that of the multitude of suits filed after Hurricane Katrina, an increasing phenomenon called "complex litigation." This term is a shorthand reference for multiple lawsuits being filed after the same event in various state and federal courts.³ The application of the statute in the context of Katrina litigation appears commonsensical since the MMTJA was passed with the purpose of remedying situations like that following Hurricane Katrina. Yet, counterintuitively, the Eastern District of Louisiana, Page 683 the federal district court in which most of the suits involving the MMTJA are pending, has uniformly remanded most of the removed cases back to state court, in effect blunting the application of the MMTJA.⁴

This Comment summarizes and analyzes the jurisprudential trend emerging from the Eastern District's remand decisions in an effort to forecast its impact on the hurricane litigation and on the MMTJA itself. The Comment provides a detailed examination of the provisions of the MMTJA in Part II, and discusses the problematic scenario that led to the enactment of the MMTJA. In Part III, the Comment analyzes the impact of the MMTJA in the litigation resulting from Hurricane Katrina, summarizing the Eastern District jurisprudence. Part III also focuses on the policy goals of the MMTJA, which provide a measuring stick with which to assess that jurisprudence. This assessment leads to the conclusion that the federal court's interpretation has blunted the MMTJA's effectiveness.

The Eastern District has narrowly interpreted the essential term in the MMTJA, "accident," to conclude that Hurricane Katrina itself is not an accident.⁵ This ruling serves to limit the exercise of jurisdiction over most of the cases filed as a result of the storm. The court has also developed an analysis of the particular nature of the case and the number of parties to the suit in order to trim back what the court sees as over-expansive removal provisions in the statute.⁶ This jurisprudential trend has been shaped by the Eastern District's justified fear that, should it read the MMTJA in an expansive manner, a flood of cases will swamp its already crowded docket.⁷ The Eastern District's fear may be enhanced by the U.S. Fifth Circuit's holding that effectively prevented the only statutory limitation on jurisdiction in the MMTJA from being applied to most of the Katrina litigation.⁸ This suggests that the Fifth Circuit's reading of the MMTJA is considerably more expansive Page 684 than the Eastern District's. Nonetheless, the Eastern District's interpretation may make the MMTJA another of Katrina's many victims.

II Background: Setting the Stage

The Eastern District's interpretation of the MMTJA statute results in part from the novelty of the statute's provisions, which are unlike any other jurisdictional statute ever passed. Part II of the Comment summarizes those provisions of the statute which have been at issue in the Katrina litigation.⁹ This part also discusses the particular problems with complex litigation and the frustration with the previous inadequate remedies. It concludes by discussing the proposed solution to these frustrations: a procedural mechanism for consolidating these actions into one forum.

A What Is the MMTJA? What Does It Do?

The MMTJA gives federal jurisdiction over a certain species of cases arising from a common accident. The statute creates both original jurisdiction¹⁰ and a kind of supplemental jurisdiction in order to facilitate efficient management of the large number of suits filed following an event.¹¹ The supplemental jurisdiction empowers defendants named in actions in federal court under ß 1369(a) to remove to federal court another action to which they are a party, related to the same accident, brought in state court.¹² Page 685

These main procedural provisions intend to facilitate the aggregation in a federal forum of multiple suits filed in multiple courts following the same event.¹³

1. ß 1369(a): The Basic Provision

The MMTJA is codified, in part, at 28 U.S.C. ß 1369. Subsection (a) contains the basic statement of jurisdiction. The statute gives the federal district courts "original jurisdiction" over "civil action[s] involving minimal diversity between adverse parties that arise[] from a single accident, where at least 75 natural persons have died in the accident . . . ."¹⁴ Minimal diversity exists when "any party is a citizen of a State and any adverse party is a citizen of another State, a citizen or subject of a foreign state, or a foreign state as defined in section 1603(a) of this title . . . ."¹⁵ This first provision manifests the MMTJA's novelty.

a Minimal Diversity

In the MMTJA, it is clear that Congress intentionally departed from the "complete diversity" rule, first enunciated in Strawbridge v. Curtis.¹⁶ This rule requires that all adverse parties be citizens of different states for there to be diversity jurisdiction under 28 U.S.C. ß 1332.¹⁷ The Strawbridge rule has been criticized in recent years because it has frustrated efforts to streamline Page 686 adjudicating in a single forum the multitude of suits filed following accidents or disasters.¹⁸ By adopting minimal diversity, Congress intends to remove the Strawbridge rule as an obstacle. It would also seem that Congress has attempted to tailor the application of the MMTJA to certain kinds of parties, such as corporate defendants, who were previously prevented from removing cases in which they were named to a single forum for efficient adjudication. Oftentimes the complete diversity rule induced parties to employ various strategies in order to prevent federal diversity jurisdiction from being invoked.¹⁹ As will be seen in the later provisions, the move to expand jurisdiction, yet narrowly tailor the application of the statute's provisions to particular cases or parties, is a prominent feature in the MMTJA.²⁰

b Single Accident

Federal jurisdiction under the MMTJA is premised on "a single accident, where at least 75 natural persons have died in the accident at a discrete location."²¹ This is a curious foundation for federal jurisdiction, which has traditionally turned on the nature of Page 687 the cause of action (federal question) or the citizenship of the parties to the lawsuit (diversity), coupled in some instances with a specific monetary amount in dispute.²² Why is jurisdiction under the MMTJA premised on the occurrence of an event with certain characteristics? Again, Congress is attempting to address a particular set of cases that often arise after an accident or disaster and cause significant judicial inefficiency. The progenitors of the current MMTJA pointed out that the problems associated with complex litigation result from situations where there is one cause of injury, but the damages occur in a variety of places.²³ The requirement that cases result from a single accident intends to tailor the scope of this jurisdiction and at the same time provide a forum to aggregate cases that would otherwise be filed in various locations.

As with the shift to minimal diversity, the MMTJA at once expands federal jurisdiction but targets that expansion to particular situations. By attempting to limit this jurisdiction to very particular circumstances, Congress remains true to the basic intent of the founders that the federal courts be of "limited"...