In re Plumbing Fixture Cases

• Decision Date: 27 December 1968
• Docket Number: No. 3.,3.
• Parties: In re PLUMBING FIXTURE CASES.
• Court: Judicial Panel on Multidistrict Litigation

298 F. Supp. 484

In re PLUMBING FIXTURE CASES.

No. 3.

Judicial Panel on Multidistrict Litigation.

December 27, 1968.

COPYRIGHT MATERIAL OMITTED

Before ALFRED P. MURRAH, Chairman, and JOHN MINOR WISDOM, EDWARD WEINFELD, EDWIN A. ROBSON, WILLIAM H. BECKER, JOSEPH S. LORD, III, and STANLEY A. WEIGEL, Judges of the Panel.

OPINION AND ORDER

WILLIAM H. BECKER, Judge of the Panel.

After a hearing on August 8, 1968, on September 13, 1968, the Judicial Panel on Multidistrict Litigation, under Section 1407, Title 28, U.S.C., ordered the transfer to the Eastern District of Pennsylvania of 37 related multidistrict civil treble damage antitrust actions, pending in seven other districts, and assigned them to the Honorable John W. Lord, Jr., District Judge, 295 F.Supp. 33.

The actions so transferred included actions originally filed in the Northern District of California, the Southern District of New York and the District of Columbia.

Later the Panel learned of nine additional similar actions pending in the Northern District of California, the Eastern District of Virginia, the Southern District of New York, the Eastern District of Wisconsin, the District of Kansas and the District of Columbia. These nine additional actions are listed in the appended Schedule B.

On October 8, 1968, in accordance with current practice the Panel, on its initiative, issued an order to show cause why the nine additional similar actions should not also be transferred under Section 1407 to the Eastern District of Pennsylvania and assigned to Judge John W. Lord, Jr., on the basis of the record of the hearing of August 8, 1968. This order further provided for a hearing on October 16, 1968, on all matters relating to (1) the proposed transfer and assignment of the additional actions to Judge Lord, (2) the transfer of the actions to another district or districts, and (3) defendants' motion to transfer the actions under Section 1407 to the Western District of Pennsylvania.

In the written responses to the order to show cause and notice of hearing, all parties except the City of New York agreed in substance to the proposed transfer and assignment of the nine additional actions to Judge John W. Lord, Jr., under Section 1407.

For the reasons hereinafter stated all actions listed in Schedule B will be transferred on the initiative of the Panel to the Eastern District of Pennsylvania and assigned to the Honorable John W. Lord, Jr., District Judge.

The Position of the City of New York

The City of New York and its related agencies (the "City") on behalf of themselves and of a class to consist of all City, twon and school district governmental units in the State of New York having a population in excess of 50,000 persons, and of all public housing authorities in the State of New York, filed a civil treble damage antitrust action in the Southern District of New York on August 2, 1968. By letter of the same date addressed to the Clerk of the Panel, counsel for the City requested that it be allowed to participate in the hearing of August 8, 1968, although its case was not among those listed in the defendants' motion to transfer or in the notice and order for the hearing of August 8.

At the hearing on August 8, counsel for the City voluntarily appeared and stated, "We agree wholeheartedly * * with coordination, and we agree wholeheartedly that the proper forum would be Philadelphia, Pennsylvania" in the Eastern District of Pennsylvania.

In its response to the order to show cause and notice of hearing of October 16, 1968, the City expressly adheres to its position that the proper forum for transfer under Section 1407 would be the Eastern District of Pennsylvania but requested that the Panel order transfer of its action subject to the following two requests:

"First, since the New York City action is brought as a class action, the court in New York has the following obligation under Rule 23(c) (1) of the Federal Rules of Civil Procedure: `As soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained * * *.' Upon such determination, the court is required to direct notice to the members of the class. We do not believe that under Section 1407(a) `pretrial proceedings' encompass a class action determination. Certainly if the entire file is transferred it would be impossible for the transferor court to discharge its obligations under Rule 23. Therefore, we request the Panel to order, as Mr. Margolis requested on August 8, that the City's action `be allowed to go forth in the Southern District of New York for a determination of the class and the validity of the class action by that Court at the same time that coordinated discovery * * * continues.' (Transcript, pp. 117-8).

"Second, extensive pretrial discovery is already underway in the City's case. The City requests that any transfer order by the Panel require completion of such discovery as the parties have agreed to or which has been ordered by the District Court for the Southern District of New York prior to the date of the Panel's order."

In summary the City requests that, in the civil action in which the City is plaintiff, the Panel order that action be transferred in part, that is for all pretrial purposes except determination of the class action questions which would be reserved by Panel order for determination after transfer by the transferor court.

In its response and in oral argument counsel for the City state that under Section 1407(a) "pretrial proceedings do not include a class action determination."

In oral argument the consequences of this contention were illuminated by the following colloquy with counsel for the City:

"JUDGE WEINFELD: Why do you call it a local action? Are you referring to the fact that you brought it within the Southern District and it involves municipalities within the State of New York and housing authorities within the State of New York?

"MR. MARGOLIS: What I meant was the court where we filed the suit should be the one to determine the class action.

"JUDGE WEINFELD: There are housing authorities right adjacent to New York State. You have them in New Jersey, you have them in Connecticut, you have them in Pennsylvania, and you have municipalities that come within the same categories. Why should you not go on a metropolitan or regional basis? In fact, that is the whole thrust of housing today, isn't it?

"MR. MARGOLIS: Yes. Well, the City chose to restrict, in bringing its class action, on the basis of various judicial opinions on class actions.

"JUDGE WISDOM: You recognize that there may be conflicts in the courts with respect to the scope of this class action, do you not?

"MR. MARGOLIS: Yes.

"JUDGE WISDOM: Now, isn't one of the purposes of this Act to avoid such pretrial conflicts?

"MR. MARGOLIS: Our position is that we don't believe that the class action is part of pretrial. That is our position.

"JUDGE WISDOM: I recognize that that is your position, but how do you justify it?"

The City apparently requests that the reservation of power of the transferor court to determine the class action issue be accomplished by dividing the papers in the file between the transferor court and the transferee court, that is, by not transferring "the entire file".

In substance the City contends that in a transfer under Section 1407 the transferee court lacks the power to determine the class action issue, and that that power remains in the transferor court after transfer.

Rulings on the City's Requests

We do not agree with this interpretation. On the contrary we hold that there should not be separation of the class action issues and a reservation to the transferor court of power to determine the class action issues because (1) the Panel lacks the power to order such a separation or reservation, and (2) the exercise of such a power, if possessed, would be unwise and indiscrete.

The second request, that the Panel in its order of transfer require completion of discovery agreed upon or which has been ordered by the transferor court, is denied for the same reasons.

Reasons for the Rulings

First, the nature of the questions to be determined by the Panel should be analyzed.

The contentions of the City raise questions of statutory construction. No question of the constitutionality of Section 1407 or of its application in these cases is raised. Only transfer under Section 1407 is under consideration. The City does not appeal to the discretion of the Panel or to forbearance by the Panel in the use of its statutory powers on principles of comity, but rather contends the Panel has no power to transfer the class action issue. In these circumstances, the questions presented are plainly questions of construction of the statute authorizing transfer. See Hoffman v. Blaski, 363 U.S. 335, 80 S.Ct. 1084, 4 L.Ed.2d 1254, 1. c. 1260, and Ex Parte Collett, 337 U.S. 55, 69 S.Ct. 944, 93 L.Ed. 1207, 10 A.L.R. 2d 921, 922, both of which involved analogous questions of construction of the related Section 1404(a) providing for inter-district transfer for all purposes (change of venue) of civil actions for the convenience of parties and witnesses in the interest of justice. See also annotations on constitutionality, construction and application of Federal Statutes providing for transfer of civil actions. 5 A.L.R.2d 1239; 10 A.L.R.2d 932.

Construction of the Clear Language of Section 1407

Under applicable principles of statutory construction, the language of the statute should be examined first. If the statutory language is clear, the words plain and the meaning clear, "there is no need to refer to the legislative history". Ex Parte Collett, supra, 337 U.S., l. c. 61, 69 S.Ct., l. c. 947, 93 L.Ed., l. c. 1211.

Paragraph (a) of Section 1407 is relied on by the City and contains some of the critical language. It reads as follows:

"(a) When civil actions involving one or more common questions of fact are pending

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