As both plaintiffs and defendants get more sophisticated, the problem of how to litigate mass torts grows more complicated. In particular, both litigants and courts struggle with the question of when a verdict should have preclusive effect in mass tort litigation, and when it should not. Before he passed away last year, Vanderbilt law professor Richard Nagareda made some progress on this question in Embedded Aggregation in Civil Litigation, an article for the Cornell Law Review. As Nagareda put it:

Each instance involves what this Article labels as a situation of “embedded aggregation.” In each, a doctrinal feature of what is ostensibly individual litigation—the scope of the right of action asserted, the nature of the remedy sought, or the character of the alleged wrong—gives rise to demands for the suit to bind nonparties in some fashion, above and beyond the ordinary stare decisis effect that any case might exert. An aggregate dimension, in short, is “embedded” doctrinally within what appears to be an individual lawsuit. That aggregate dimension, in turn, gives rise to demands for binding effect of a commensurately aggregate scope.

(Emphasis added.)  Nagareda looked at three types of litigation in particular. First, he examined the uses of offensive collateral estoppel in FOIA litigation. (Several courts have declined to apply one information-seeker’s victory against a government agency to collaterally estop the agency from opposing anyone else seeking the same information.) Second, he examined the policy arguments over punitive damages. (Lawyers often argue for punitive damages based on company policies or histories of bad behavior, which necessarily imports actions that would give rise to other litigation.) Finally, he looked at the controversial Vioxx settlement. (Vioxx settled a large number of personal-injury claims with "inventory settlements," where plaintiffs’ counsel had to agree to settle cases on behalf of all their clients to qualify.)

Based on these three examples, Nagareda concluded that:

Contrary to some voices in the literature, this Article contends that the constraints on class certification elaborated over decades of real-world experience are not hypertechnical bugaboos. Rather, they stem ultimately from a well-taken notion of “preclusive symmetry”—an insistence that the plaintiff class ought not to be positioned to wield the bargaining leverage of a class-wide trial without, at the same time, affording to the defendant the assurance of a commensurately binding victory were the defendant, rather than the plaintiff class, to prevail on the merits.

This is not to say that aggregation of some kind is never the solution to these problems of embedded aggregation. However, Nagareda identified three factors that might influence courts to allow some kind of aggregate preclusive effect in litigation. Those are:

  • "Standing." Standing here does not mean constitutional standing, just whether the party suing the defendant was the party actually harmed. (So, for example, a plaintiffs that seeks punitive damages for acts that didn’t harm her is probably not entitled to them.)
  • Divisibility of remedy.  Nagareda’s analysis here seems similar to the one used for Rule 23(b)(1). He asked whether "the court could, as a practical matter, afford [the proposed remedy] to the plaintiff at hand without affecting the application or availability of the same remedy to other persons who are non-parties to the plaintiff’s lawsuit."
  • Is the wrong widespread? In other words, is it something that would apply to a large number of people, like a design defect or a failure to warn?

Nagareda ultimately argues that these kinds of "embedded aggregation" cases call for some "hybridized" form of aggregation. Unfortunately, Nagareda’s description of "hybridized" aggregation is somewhat vague. But it does identify several lines of thought that defendants should be aware of: either because they may yield some interesting settlements proposals (like in the Vioxx cases) or because they foreshadow arguments that plaintiffs’ counsel will use in future mass torts.