The reexamination clause: exploring bifurcation in mass tort litigation: analyzing the constitutional hurdle to bifurcated trials.

• Author: Taber, W. Russell

THE rise of mass tort cases has stretched judicial ingenuity and resources to their limits. Dockets across the country are flooded with claims against manufacturers of goods, like cigarettes and asbestos, that carry the capacity to cause mass injury. Resolving these cases individually could take decades, and prevailing plaintiffs often receive pennies for every dollar spent on litigation and transaction costs. In response, many district courts have separated a particular issue or issues for class treatment under Rule 23(c)(4)(A) of the Federal Rules of Civil Procedure, while leaving individual issues for individual trials before different juries. This procedure, known as bifurcation, (1) can streamline a case because resolution of a common issue (e.g., general causation) often eliminates the need for further proceedings. Accordingly, bifurcation has been described as "one of the sharpest instruments available to trial courts managing mass tort litigation" (2) and "one of the most necessary and natural in [trial judges'] arsenal of tools required for the shaping of these types of cases for efficient adjudication." (3)

In addition, plaintiffs often seek certification of an issue class to pressure defendants into an overall settlement of claims. Aggregation of claims exerts pressure on defendants to settle all of the plaintiffs' claims because of "the sheer magnitude of the risk" to which litigating an aggregated proceeding exposes defendants. (4) Aggregation can be difficult to achieve in a traditional class action due to "intractable management problems" and other hurdles identified by the Supreme Court in Amchem Products, Inc. v. Windsor, which has made judicial approval of class settlement--a device which avoids the management problems of a class action precisely because there is no trial--difficult to obtain for similar reasons. (5) Not surprisingly, plaintiffs have resorted to certification of issue classes to achieve the overall settlement pressures of aggregation while potentially avoiding pitfalls identified in Amchem due to the more limited nature of the issue class inquiry. (6)

Yet perhaps the most significant obstacle to bifurcation is the Constitution itself. The Reexamination Clause of the Seventh Amendment provides that "no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law. (7) Various courts have held that the Reexamination Clause prevents judges from bifurcating trials where "an overlapping common issue tried by a jury in an aggregate proceeding might thereafter be subjected to prohibited reexamination by juries in subsequent individual proceedings." (8) Other courts have largely reached the opposite conclusion--that the Clause "does not substantially inhibit" a trial judge's ability to bifurcate. (9)

1. The Relevance of the Reexamination Clause in Mass Tort Cases

   Courts have frequently allowed mass tort (10) cases to be brought as class actions "with respect to particular issues" under Rule 23(c)(4)(A) of the Federal Rules of Civil Procedure, (11) and have left individual issues for separate trials before different juries.

   A. Gasoline Products Co. v. Champlin Refining Co.

   Those courts that view the Reexamination Clause as a significant stumbling block to bifurcation have claimed support in Gasoline Products. (12) In this breach of contract case, a jury found liability and awarded damages, but did not specify its findings as to the terms of the contract or the date of its formation and breach. The First Circuit affirmed the liability determination, but set aside the jury's finding with respect to damages due to erroneous jury instructions. On appeal, the Supreme Court faced the question whether a partial new trial on damages before a different jury violated the Reexamination Clause. Although the Seventh Amendment "does not compel a new trial of [liability] even though another and separable issue must be tried again," the Court held that this partial new trial was impermissible:

   Where the practice permits a partial new trial, it may not properly be resorted to unless it clearly appears that the issue to be retried is so distinct and separable from the others that a trial of it alone may be had without injustice ... Here the question of damages on the counterclaim is so interwoven with that of liability that the former cannot be submitted to the jury independently of the latter without confusion and uncertainty, which would amount to a denial of a fair trial. (13) B. Bifurcation Plans Raising Reexamination Concerns

   There are many ways to separate one or more issues for class treatment from others to be tried individually. The means in which issues are divided can raise concerns under the Reexamination Clause.

   1. Liability Versus Damages

      The drafters of Rule 23(c)(4)(a) specifically envisioned certifying liability for class treatment, while leaving to individual trials the task of proving damages. (14) A federal district judge followed a "similar proposal" in a case entitled In re Copley Pharmacy, Inc. by bifurcating liability from damages in a national class action brought on behalf of persons injured by a contaminated pharmaceutical product manufactured by the defendant drug company. (15) Under the court's plan, "the class trial would establish [the defendant's] liability to the class certified by the Court, which includes 'all persons who suffered damages as a result of inhalation of [the product] manufactured, supplied, distributed or placed in commerce by [the defendant]." (16) The Copley court upheld the bifurcation plan despite a challenge under the Reexamination Clause by distinguishing the Seventh Circuit's decision in a case entitled, In the Matter of Rhone-Poulenc Rorer Inc., which invalidated a bifurcation plan that separated negligence from the overlapping issues of comparative negligence and proximate cause. The Copley court concluded that "comparative negligence is unlikely to be a defense in this case" and that the plan was consistent with Rule 23(c)(4)(A). (17)

      Similarly, the Sixth Circuit upheld a trial plan that separated liability from damages in an action brought on behalf of children with birth defects against a drug manufacturer in a case entitled In re Bendectin Litigation. (18) The trial court trifurcated the case--essentially bifurcating "the liability question into liability and causation" and left to individual trials the task of proving damages. (19) The plaintiffs' concern was not with separate factfinders adjudicating different issues, but with the ability of a court under Rule 42(b) to try separately in different phases before the same jury the issue of proximate causation and the issue of the defendant's tortuous conduct. The Sixth Circuit found no Seventh Amendment violation with this aspect of the plan in part because "the initial trial on the proximate causation issue was a separable issue" and upheld the entire trifurcated proceeding. (20) In doing so, the Bendectin court concluded that Gasoline Products did not preclude the plan and adopted what it called the "Gasoline Products standard," which considered 'the issue's ability to be tried separately, and without injustice" when "determining whether the Seventh Amendment has been violated by conducting a trial only on that one issue." (21)

   2. Particular Elements of Liability Versus Other Liability Elements and/or Affirmative Defenses

      Perhaps the most common means of separating a class with respect to particular issues is trying certain elements of liability in one phase and other liability elements and/or affirmative defenses in a subsequent phase or phases.

      1. Negligence Versus Comparative Negligence

         The Seventh Circuit's decision illustrates the potential for a Reexamination Clause problem when separating negligence from comparative negligence in the case In the Matter of Rhone-Poulenc Rorer Inc. (22) The plaintiffs, approximately four hundred hemophiliacs infected with the human immunodeficiency virus (HIV), sued drug companies that manufactured blood solids necessary for treating the plaintiffs' disease. Writing for the majority, Judge Posner concluded that the Reexamination Clause prevented the bifurcation of the issue of the defendants' negligence in one phase of the trial from all other issues. The Reexamination Clause, according to Judge Posner, required judges to "carve at the joint" so as to avoid dividing "issues between separate trials in such a way that the same issue is reexamined by different juries."(23) His concern with the certification plan was that the issue of the defendants' negligence overlapped the issue of comparative negligence, leading to potentially inconsistent jury verdicts.

         Following Judge Posner's approach, the Fifth Circuit in Castano v. American Tobacco Co., held that the Clause prohibited class certification of "core liability issues" in an action brought on behalf of smokers nationwide against tobacco companies. (24) The district court had certified an opt-out class with respect to issues of the defendants' liability under various theories like negligence and strict liability, but left to individual trials other issues such as injury-in-fact, proximate cause, reliance, affirmative defenses, and compensatory damages. According to the Fifth Circuit, the Reexamination Clause "allows bifurcation of issues that are so separable that the second jury will not be called upon to reconsider findings of fact by the first." (25) To support its interpretation, the Fifth Circuit relied on Gasoline Products' determination that a partial new trial may not be "properly resorted to unless it clearly appears that the issue to be retried is so distinct and separable from the others that a trial of it alone may be had without injustice." (26) The Castano court concluded that "[s]evering a defendant's conduct from comparative negligence" violated the Clause:

         There is a risk that in apportioning fault, the...