Judicial Intervention in Class Action or Mass Tort Claims

Recently, a judge in the 9-11 Mass Tort litigation case involving 10,000 lawsuits by firefighters, police, and other rescue workers against the City of New York rejected a $657 million settlement negotiated by their attorneys, because it did not provide sufficient compensation to the victims. Later, the judge accepted a new settlement of $712 million.

Although the increased settlement sounds much higher, when you consider that there are 10,000 Plaintiffs involved, the increased amount, after deducting attorney fees, amounts to less than $5,000 per Plaintiff. The question becomes, how should a judge in a class action intervene with a settlement agreed by the parties? If judges are to interpose their beliefs in a Mass Tort action for either side, what effect will it have on future cases?

While judges are given wide latitude to act in Mass Tort claims, they rarely take interest in the settlement itself. Class action law does give the court has authority to supervise settlements, but the question is not whether the judge has authority to do so; it is whether the judge should unilaterally impose authority on voluntarily agreements between the parties.

In the case mentioned above, the Plaintiffs did get an increased settlement, a small amount on a per capita basis. But lawsuits are not sure things, as any attorney, whether a Plaintiff or Defendant’s attorney can attest. Settlements are a voluntary compromise. If for example, the judge throws out a settlement agreed by the parties, and one side refuses to move from their position, the case would necessarily have to go to trial. In that case, there is generally a winner and a loser, rather than a compromise. The Plaintiffs, who had a settlement agreed by the parties, may end up getting nothing at trial. Conversely, a Defendant may end up paying substantially more than agreed.

Would an intervening judge cause a chilling effect of filing Mass Tort actions? Would it have a chilling effect of voluntary agreements between the parties? If there is a judge with a history of intervening, it is likely to diminish each side’s willingness to enter into negotiations, knowing that a judge may throw out an agreement after the cards are on the table.

Judges play a vital role in our legal system, obviously, and wield a great deal of authority. But the authority of the judiciary must be used with caution, especially when it affects the willingness of parties to resolve their disputes voluntarily. The judiciary must consider the affect its intervention will have on future parties before it. That is not to say the judge erred in his decision. The parties did come to settlement agreement. The concern is that this move may lead to more complex and lengthy litigation in future Mass Tort claims.

The law firm of Childers, Schlueter & Smith has extensive experience in Mass Tort and other individual litigation cases. The firm has recovered more than $150,000,000 in verdicts and settlements for its clients. If you were seriously injured and believe you may have a claim, contact our office for a free consultation.