HR 2112 RFS

September 14, 1999

Received; read twice and referred to the Committee on the Judiciary

To amend title 28, United States Code, to allow a judge to whom a case is transferred to retain jurisdiction over certain multidistrict litigation cases for trial, and to provide for Federal jurisdiction of certain multiparty, multiforum civil actions.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Multidistrict, Multiparty, Multiforum Trial Jurisdiction Act of 1999'.

SEC. 2. MULTIDISTRICT LITIGATION.

Section 1407 of title 28, United States Code, is amended--

(1) in the third sentence of subsection (a), by inserting `or ordered transferred to the transferee or other district under subsection (i)' after `terminated'; and

(2) by adding at the end the following new subsection:

`(i)(1) Subject to paragraph (2) and except as provided in subsection (j), any action transferred under this section by the panel may be transferred for trial purposes, by the judge or judges of the transferee district to whom the action was assigned, to the transferee or other district in the interest of justice and for the convenience of the parties and witnesses.

`(2) Any action transferred for trial purposes under paragraph (1) shall be remanded by the panel for the determination of compensatory damages to the district court from which it was transferred, unless the court to which the action has been transferred for trial purposes also finds, for the convenience of the parties and witnesses and in the interests of justice, that the action should be retained for the determination of compensatory damages.'.

SEC. 3. MULTIPARTY, MULTIFORUM JURISDICTION OF DISTRICT COURTS.

(a) BASIS OF JURISDICTION-

(1) IN GENERAL- Chapter 85 of title 28, United States Code, is amended by adding at the end the following new section:

`Sec. 1369. Multiparty, multiforum jurisdiction

`(a) IN GENERAL- The district courts shall have original jurisdiction of any civil action involving minimal diversity between adverse parties that arises from a single accident, where at least 25 natural persons have either died or incurred injury in the accident at a discrete location and, in the case of injury, the injury has resulted in damages which exceed $75,000 per person, exclusive of interest and costs, if--

`(1) a defendant resides in a State and a substantial part of the accident took place in another State or other location, regardless of whether that defendant is also a resident of the State where a substantial part of the accident took place;

`(2) any two defendants reside in different States, regardless of whether such defendants are also residents of the same State or States; or

`(3) substantial parts of the accident took place in different States.

`(b) SPECIAL RULES AND DEFINITIONS- For purposes of this section--

`(1) minimal diversity exists between adverse parties if 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;

`(2) a corporation is deemed to be a citizen of any State, and a citizen or subject of any foreign state, in which it is incorporated or has its principal place of business, and is deemed to be a resident of any State in which it is incorporated or licensed to do business or is doing business;

`(3) the term `injury' means--

`(A) physical harm to a natural person; and

`(B) physical damage to or destruction of tangible property, but only if physical harm described in subparagraph (A) exists;

`(4) the term `accident' means a sudden accident, or a natural event culminating in an accident, that results in death or injury incurred at a discrete location by at least 25 natural persons; and

`(5) the term `State' includes the District of Columbia, the Commonwealth of Puerto Rico, and any territory or possession of the United States.

`(c) INTERVENING PARTIES- In any action in a district court which is or could have been brought, in whole or in part, under this section, any person with a claim arising from the accident described in subsection (a) shall be permitted to intervene as a party plaintiff in the action,

even if that person could not have brought an action in a district court as an original matter.

`(d) NOTIFICATION OF JUDICIAL PANEL ON MULTIDISTRICT LITIGATION- A district court in which an action under this section is pending shall promptly notify the judicial panel on multidistrict litigation of the pendency of the action.'.

(2) CONFORMING AMENDMENT- The table of sections at the beginning of chapter 85 of title 28, United States Code, is amended by adding at the end the following new item:

`1369. Multiparty, multiforum jurisdiction.'.

(b) VENUE- Section 1391 of title 28, United States Code, is amended by adding at the end the following:

`(g) A civil action in which jurisdiction of the district court is based upon section 1369 of this title may be brought in any district in which any defendant resides or in which a substantial part of the accident giving rise to the action took place.'.

(c) MULTIDISTRICT LITIGATION- Section 1407 of title 28, United States Code, as amended by section 2 of this Act, is further amended by adding at the end the following:

`(j)(1) In actions transferred under this section when jurisdiction is or could have been based, in whole or in part, on section 1369 of this title, the transferee district court may, notwithstanding any other provision of this section, retain actions so transferred for the determination of liability and punitive damages. An action retained for the determination of liability shall be remanded to the district court from which the action was transferred, or to the State court from which the action was removed, for the determination of damages, other than punitive damages, unless the court finds, for the convenience of parties and witnesses and in the interest of justice, that the action should be retained for the determination of damages.

`(2) Any remand under paragraph (1) shall not be effective until 60 days after the transferee court has issued an order determining liability and has certified its intention to remand some or all of the transferred actions for the determination of damages. An appeal with respect to the liability determination and the choice of law determination of the transferee court may be taken during that 60-day period to the court of appeals with appellate jurisdiction over the transferee court. In the event a party files such an appeal, the remand shall not be effective until the appeal has been finally disposed of. Once the remand has become effective, the liability determination and the choice of law determination shall not be subject to further review by appeal or otherwise.

`(3) An appeal with respect to determination of punitive damages by the transferee court may be taken, during the 60-day period beginning on the date the order making the determination is issued, to the court of appeals with jurisdiction over the transferee court.

`(4) Any decision under this subsection concerning remand for the determination of damages shall not be reviewable by appeal or otherwise.

`(5) Nothing in this subsection shall restrict the authority of the transferee court to transfer or dismiss an action on the ground of inconvenient forum.'.

(d) REMOVAL OF ACTIONS- Section 1441 of title 28, United States Code, is amended--

(1) in subsection (e) by striking `(e) The court to which such civil action is removed' and inserting `(f) The court to which a civil action is removed under this section'; and

(2) by inserting after subsection (d) the following new subsection:

`(e)(1) Notwithstanding the provisions of subsection (b) of this section, a defendant in a civil action in a State court may remove the action to the district court of the United States for the district and division embracing the place where the action is pending if--

`(A) the action could have been brought in a United States district court under section 1369 of this title; or

`(B) the defendant is a party to an action which is or could have been brought, in whole or in part, under section 1369 in a United States district court and arises from the same accident as the action in State court, even if the action to be removed could not have been brought in a district court as an original matter.

The removal of an action under this subsection shall be made in accordance with section 1446 of this title, except that a notice of removal may also be filed before trial of the action in State court within 30 days after the date on which the defendant first becomes a party to an action under section 1369 in a United States district court that arises from the same accident as the action in State court, or at a later time with leave of the district court.

`(2) Whenever an action is removed under this subsection and the district court to which it is removed or transferred under section 1407(j) has made a liability determination requiring further proceedings as to damages, the district court shall remand the action to the State court from which it had been removed for the determination of damages, unless the court finds that, for the convenience of parties and witnesses and in the interest of justice, the action should be retained for the determination of damages.

`(3) Any remand under paragraph (2) shall not be effective until 60 days after the district court has issued an order determining liability and has certified its intention to remand the removed action for the determination of damages. An appeal with respect to the liability determination and the choice of law determination of the district court may be taken during that 60-day period to the court of appeals with appellate jurisdiction over the district court. In the event a party files such an appeal, the remand shall not be effective until the appeal has been finally disposed of. Once the remand has become effective, the liability determination and the choice of law determination shall not be subject to further review by appeal or otherwise.

`(4) Any decision under this subsection concerning remand for the determination of damages shall not be reviewable by appeal or otherwise.

`(5) An action removed under this subsection shall be deemed to be an action under section 1369 and an action in which jurisdiction is based on section 1368 of this title for purposes of this section and sections 1407, 1660, 1697, and 1785 of this title.

`(6) Nothing in this subsection shall restrict the authority of the district court to transfer or dismiss an action on the ground of inconvenient forum.'.

(e) CHOICE OF LAW-

(1) DETERMINATION BY THE COURT- Chapter 111 of title 28, United States Code, is amended by adding at the end the following new section:

`Sec. 1660. Choice of law in multiparty, multiforum actions

`(a) FACTORS- In an action which is or could have been brought, in whole or in part, under section 1369 of this title, the district court in which the action is brought or to which it is removed shall determine the source of the applicable substantive law, except that if an action is transferred to another district court, the transferee court shall determine the source of the applicable substantive law. In making this determination, a district court shall not be bound by the choice of law rules of any State, and the factors that the court may consider in choosing the applicable law include--

`(1) the place of the injury;

`(2) the place of the conduct causing the injury;

`(3) the principal places of business or domiciles of the parties;

`(4) the danger of creating unnecessary incentives for forum shopping; and

`(5) whether the choice of law would be reasonably foreseeable to the parties.

The factors set forth in paragraphs (1) through (5) shall be evaluated according to their relative importance with respect to the particular action. If good cause is shown in exceptional cases, including constitutional reasons, the court may allow the law of more than one State to be applied with respect to a party, claim, or other element of an action.

`(b) ORDER DESIGNATING CHOICE OF LAW- The district court making the determination under subsection (a) shall enter an order designating the single jurisdiction whose substantive law is to be applied in all other actions under section 1369 arising from the same accident as that giving rise to the action in which the determination is made. The substantive law of the designated jurisdiction shall be applied to the parties and claims in all such actions before the court, and to all other elements of each action, except where Federal law applies or the order specifically provides for the application of the law of another jurisdiction with respect to a party, claim, or other element of an action.

`(c) CONTINUATION OF CHOICE OF LAW AFTER REMAND- In an action remanded to another district court or a State court under section 1407(j)(1) or 1441(e)(2) of this title, the district court's choice of law under subsection (b) shall continue to apply.'.

(2) CONFORMING AMENDMENT- The table of sections at the beginning of chapter 111 of title 28, United States Code, is amended by adding at the end the following new item:

`1660. Choice of law in multiparty, multiforum actions.'.

(f) SERVICE OF PROCESS-

(1) OTHER THAN SUBPOENAS- (A) Chapter 113 of title 28, United States Code, is amended by adding at the end the following new section:

`Sec. 1697. Service in multiparty, multiforum actions

`When the jurisdiction of the district court is based in whole or in part upon section 1369 of this title, process, other than subpoenas, may be served at any place within the United States, or anywhere outside the United States if otherwise permitted by law.'.

(B) The table of sections at the beginning of chapter 113 of title 28, United States Code, is amended by adding at the end the following new item:

`1697. Service in multiparty, multiforum actions.'.

(2) SERVICE OF SUBPOENAS- (A) Chapter 117 of title 28, United States Code, is amended by adding at the end the following new section:

`Sec. 1785. Subpoenas in multiparty, multiforum actions

`When the jurisdiction of the district court is based in whole or in part upon section 1369 of this title, a subpoena for attendance at a hearing or trial may, if authorized by the court upon motion for good cause shown, and upon such terms and conditions as the court may impose, be served at any place within the United States, or anywhere outside the United States if otherwise permitted by law.'.

(B) The table of sections at the beginning of chapter 117 of title 28, United States Code, is amended by adding at the end the following new item:

`1785. Subpoenas in multiparty, multiforum actions.'.

SEC. 4. EFFECTIVE DATE.

(a) SECTION 2- The amendments made by section 2 shall apply to any civil action pending on or brought on or after the date of the enactment of this Act.

(b) SECTION 3- The amendments made by section 3 shall apply to a civil action if the accident giving rise to the cause of action occurred on or after the 90th day after the date of the enactment of this Act.

Passed the House of Representatives September 13, 1999.

Attest:

JEFF TRANDAHL,

Clerk.

END