In re: Class Action Settlement Administration Litigation

Background

The Judicial Panel on Multidistrict Litigation considered a request under 28 U.S.C. § 1407 to centralize five lawsuits pending in four federal districts. The lawsuits concern allegations that three settlement claims administrators—Angeion, Epiq, and JND—diverted settlement deposits to Huntington and Western Alliance in exchange for financial benefits, including interest and investment earnings. The plaintiffs seek to represent substantially similar nationwide classes and assert claims under federal antitrust law, the Racketeer Influenced and Corrupt Organizations Act, and common law.

The lawsuits also include allegations about a separate digital-payment kickback scheme. According to the opinion, Tremendous, Blackhawk Network Holdings, and Digital Settlement Technologies allegedly induced claims administrators to use their digital-payment platforms by sharing revenue from unredeemed or unclaimed payment cards.

Arguments about centralization

The moving plaintiffs requested centralization in the Eastern District of Pennsylvania or, alternatively, the Southern District of New York. Other plaintiffs supported centralization but asked the Panel to separate and send back the digital-payment allegations in the Baker action, while requesting centralization in the Northern District of California. Six defendants supported centralization of all claims in the Southern District of New York. Kroll Settlement Administration took no position on centralization but opposed selecting the Southern District of Florida, which no party had proposed.

Panel’s analysis

The Panel found common factual questions among the actions. It concluded that centralization would eliminate duplicative discovery, reduce the risk of inconsistent pretrial rulings—especially on class certification—and conserve the resources of the parties, their attorneys, and the courts.

The Panel declined to separate the digital-payment allegations. It found that those allegations involved the same claims-administrator defendants and many of the same underlying settlements as the bank-kickback allegations. Keeping them together would avoid requiring defendants and witnesses to participate in proceedings in multiple districts. The Panel also stated that separating the allegations might not be practical because the claims were not directed solely at the digital-payment defendants and the applicable statute does not authorize transferring one issue within a claim while sending another issue back.

Ruling

The Panel ordered that the five actions listed on Schedule A be transferred to the District of Columbia and, with that court’s consent, assigned to the Honorable John D. Bates for coordinated or consolidated pretrial proceedings. The five actions were listed as pending in the Northern District of California, Southern District of Florida, Southern District of New York, and Eastern District of Pennsylvania.

The supplied case metadata identifies Jacquelyn Corley as the judge, but the opinion text is a Judicial Panel transfer order. It states that Judge John D. Bates would receive the coordinated or consolidated pretrial proceedings; it does not state that Judge Corley decided the transfer order.