Blackmore v. Smitty's Supply, Inc.
| Citation | 451 F.Supp.3d 1003 |
| Decision Date | 31 March 2020 |
| Docket Number | No. 19-CV-4052-CJW-KEM,19-CV-4052-CJW-KEM |
| Parties | Terry BLACKMORE, Jason Klingenberg, and Wayne Rupe, Plaintiffs, v. SMITTY'S SUPPLY, INC.; Tractor Supply Company; and Cam2 International, LLC; Defendants. |
| Court | United States District Courts. 8th Circuit. Northern District of Iowa |
Paul D. Lundberg, Lundberg Law Firm, Sioux City, IA, Bryan T. White, Pro Hac Vice, Gene Graham, Pro Hac Vice, William L. Carr, Pro Hac Vice, White Graham Buckley & Carr LLC, Independence, MO, Dirk L. Hubbard, Pro Hac Vice, Thomas V. Bender, Pro Hac Vice, Horn Aylward & Bandy LLC, Kansas City, MO, for Plaintiffs.
Jacqueline Cook, Pro Hac Vice, Nikki Eckland Cannezzaro, Pro Hac Vice, Franke Schultz and Mullen, Kansas City, MO, John C. Gray, Heidman Law Firm LLP, Sioux City, IA, for Defendants.
Kelly K.E. Mahoney, United States Chief Magistrate Judge This putative class action involves claims that Defendants deceptively marketed and labeled their product, hydraulic fluid for tractors, to consumers in Iowa. Defendants are subject to similar lawsuits in federal court in six other states—Kansas, Kentucky, Arkansas, Texas, Minnesota, and California. The putative class in each case consists of consumers in the forum state, and the claims in each case are governed by the law of the forum state (e.g., the Texas action alleges Defendants deceptively marketed their products to Texas consumers, in violation of Texas law). The same attorneys as in this case represent plaintiffs and defendants in the other cases. In addition, the same attorneys were involved in a Missouri putative class action involving similar claims that has already settled.
On February 12, 2020, Defendants Smitty's Supply Inc. and Cam2 International LLC filed a motion with the Judicial Panel on Multidistrict Litigation (JPML or MDL Panel) seeking to consolidate and transfer all pending federal cases to the Eastern District of Louisiana, as well as any similar actions that may be filed in federal court in the future. See MDL No. 2936. Plaintiffs resist transfer. The MDL Panel has not yet ruled on the motion.
In their current motion, Defendants seek to stay proceedings in this court pending a ruling by the MDL Panel on the consolidation motion. Doc. 38. Plaintiffs filed a resistance (Doc. 44), Defendants filed a reply (Doc. 45), and plaintiffs filed a sup-reply (Doc. 48). I deny the motion to stay (Doc. 38).
Under JPML Rule of Procedure 2.1(d), the filing of a motion to transfer with the MDL Panel does not deprive the original court of jurisdiction while the motion is pending. "In other words, a district judge should not automatically stay discovery, postpone rulings on pending motions, or generally suspend further rulings upon a parties' motion to the MDL Panel for transfer and consolidation." Rivers v. Walt Disney Co. , 980 F. Supp. 1358, 1360 (C.D. Cal. 1997). Instead, the granting of a motion to stay pending a ruling on the transfer motion is a matter of the district court's discretion. Id. The parties agree that when considering a motion to stay, the court considers three factors: "(1) potential prejudice to the non-moving party; (2) hardship and inequity to the moving party if the action is not stayed; and (3) the judicial resources that would be saved by avoiding duplicative litigation if the cases are in fact consolidated." Id. ; see also Docs. 39, 44.
Plaintiffs argue that they would be prejudiced by a stay. The MDL Panel is not set to hear the transfer motion in this case at its upcoming argument session on March 26, 2020, and the next scheduled argument session is not until May 28, 2020. Plaintiffs argue that they would be prejudiced by a stay as the case would be delayed. The current upcoming deadlines are as follows:
Doc. 26. A stay would delay the parties' class-certification expert discovery and ultimately, the parties' briefing on class certification.
Plaintiffs argue that this delay would be especially prejudicial as the MDL Panel is unlikely to grant transfer. In support, Plaintiffs cite two recent MDL Panel cases denying motions to transfer: In re CP4 Fuel Pump Marketing, Sales Practices, & Products Liability Litigation , 412 F. Supp. 3d 1365 (J.P.M.L. 2019), and In re StockX Customer Data Security Breach Litigation , 412 F. Supp. 3d 1363 (J.P.M.L. 2019). In In re CP4 Fuel , the MDL Panel denied consolidation of ten putative class actions against three different car-manufacturer defendants that alleged the cars contained a defective fuel pump by the same supplier; five cases were brought against one defendant, four against a second defendant, and one against a third defendant. 412 F. Supp. 3d at 1366. The MDL Panel reasoned that although there were some common factual issues, there were numerous issues distinct to each defendant—e.g., each defendant's design and testing process, knowledge of the defect, and marketing to consumers. Id. at 1366-67. The MDL Panel also noted that the various plaintiffs' allegations indicated the defect did not manifest the same way from vehicle to vehicle, suggesting there would also be plaintiff-specific issues. Id. at 1367. The MDL Panel further noted that because the three defendants were all competitors, consolidating the actions might complicate case management due to the need to protect trade secrets and confidential information. Id. The MDL Panel denied the alternative request to create three multidistrict litigations (MDLs), one for each defendant, given the small number of actions (five, four, and one) and "the presence of the same plaintiffs' counsel in almost all the actions," which "suggest[ed] that cooperation and informal coordination by the involved courts and counsel are practicable, and should be effective in minimizing or eliminating duplicative pretrial proceedings." Id. Here, although plaintiffs are represented by the same counsel in all actions (as in In re CP4 Fuel ), there are a slightly greater number of actions involving the same defendant (seven) than in In re CP4 Fuel , and the complaints here contain the same damages allegations (that plaintiffs overpaid for the product, exposed their equipment to harm by using the product, and did not protect their equipment from increased wear and damage).
In In re StockX , the MDL Panel held that centralization was not necessary when the parties sought to consolidate only three putative class actions and two potential tag-along cases (five total) involving a data breach. 412 F. Supp. 3d at 1364 & n.1. The MDL Panel noted that the number of cases was not growing, as "the last of the five related cases was filed nearly three months ago." Id. at 1364. The MDL Panel held "[i]n these circumstances, cooperation among the few involved courts and counsel is a workable alternative to centralization." Id. at 1364-65. Again, here, there are slightly more actions at issue—seven.
I further note that although In re CP4 Fuel and In re StockX may suggest transfer will not be granted in this case, they do not address the propriety of a stay pending a ruling by the MDL Panel. In the underlying In re StockX cases, unresisted stays were granted pending the MDL Panel's ruling on the motion to transfer;1 and in the underlying In re CP4 Fuel cases, four courts granted stays pending the MDL Panel's ruling (one by consent,2 one over a resistance,3 and two without waiting for a response opposing or consenting to the stay4 ); and three courts denied requests for stays.5
Defendants respond by pointing to cases that they argue demonstrate the MDL Panel is likely to grant transfer. See In re Juul Labs, Inc., Mktg., Sales Practices, & Prods. Liab. Litig. , 396 F. Supp. 3d 1366, 1367 (J.P.M.L. 2019) (); In re Hill's Pet Nutrition, Inc., Dog Food Prods. Liab. Litig. , 382 F. Supp. 3d 1350, 1350-51 (J.P.M.L. 2019) (); In re Allura Fiber Cement Siding Prods. Liab. Litig. , 366 F. Supp. 3d 1365, 1365-66 (J.P.M.L. 2019) (); In re Wayne Farms LLC FLSA Litig. , 528 F. Supp. 2d 1355, 1356 (J.P.M.L. 2007) (); In re Rio Hair Naturalizer Prods. Liab. Litig. , 904 F. Supp. 1407, 1407-08 (J.P.M.L. 1995) (); In re Temporomandibular Joint (TMJ) Implants Prods. Liab. Litig. , 844 F. Supp. 1553, 1553-54 (J.P.M.L. 1994) (...
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