Judicial Panel Rejects Opposition to Defense Request for Pretrial Coordination Pursuant to 28 U.S.C. § 1407 and Grants Defense Motion for Centralization of Three Class Action Lawsuits
On May 3, 2006, a laptop computer and external hard drive was stolen from the home of an employee of the Department of Veterans Affairs, resulting in the loss of “the names, dates of birth, and social security numbers of approximately 26 million veterans and active duty military personnel.” In re Dep’t of Veterans Affairs (VA) Data Theft Litig., 461 F.Supp.2d 1367 (Jud. Pan.Mult.Lit. November 3, 2006). Three putative class action lawsuits followed, and defense attorneys moved the Judicial Panel on Multidistrict Litigation (MDL) pursuant to 28 U.S.C. § 1407 to centralize the lawsuits for pretrial purposes in the District of the District of Columbia. Id. Plaintiffs in already in the D.C. federal court supported the motion; plaintiffs in actions pending in New York and Kentucky opposed the motion, or alternatively requested transfer to Kentucky. The Panel agreed with defense attorneys that centralization was warranted and that the District of the District of Columbia was the appropriate transferee court. In so holding, the Panel rejected opposition arguments that centralization was not warranted due to the “minimal number of actions involved” and that “transfer under the ‘first to file’ rule” would be superior to centralization under Section 1407. Id.
NOTE: The Panel’s holding highlights that Section 1407 does not require a minimum number of pending lawsuits be on file in order to warrant transfer. The purpose of centralization under Section 1407 is “to eliminate duplicative discovery, prevent inconsistent pretrial rulings, and conserve the resources of the parties, their counsel and the judiciary.” In re Dep’t of Veterans Affairs, at *1.