United States Judicial Panel On Multidistrict Litigation Panel Rules On Nationwide Class Action Lawsuits Filed Against DuPont

The United States Judicial Panel on Multidistrict Litigation, agreeing with the arguments of Starr Austen & Miller, LLP, ruled that the Eastern District of Pennsylvania will be the forum to hear all of the class action lawsuits against DuPont regarding their herbicide Imprelis.  DUPONT’S herbicide Imprelis is causing widespread death among trees and other non-targeted vegetation across the country. 

The panel's basis was due to the U.S. Environmental Protection Agency office, responsible for the investigation and handling of the Imprelis, was located in Philadelphia.  In addition, the federal courthouse in Philadelphia is in close proximity to DuPont's headquarters in Wilmington, Delaware.  The panel went on to state that the location is within the geographic concentration of Imprelis damage and is a venue with a willing and experienced transferee judge.  

Multidistrict litigation is a procedure utilized in the federal court system to transfer to one federal judge all pending civil cases of a similar type filed throughout the United States. The decision whether cases should be transferred is made by a panel of seven federal judges appointed by the Chief Justice of the United States Supreme Court. The purpose of multidistrict litigation is to prevent different rulings on the same issue.  If one judge is presiding over all pretrial motions and discovery issues, there will be only one decision. 

Additional details on the ruling can be found at:

 http://www.starrausten.com/multidistrict-litigation-panel-rules-on-nationwide-class-action-against-dupont/

Does a police officer owe a duty to warn citizens of a icy road?

In Putnam County Sheriff v. Pamela Price, No. 60S01-1012-CV-665, the high court concluded that the sheriff’s department didn’t owe a duty to alleviate or warn motorists of an icy or hazardous condition on a county roadway. Citing Benton v. City of Oakland City, 721 N.E.2d 224, 230 (Ind. 1999), on which Price relies to support her negligence claim, the justices noted implicit in that case was that the governmental entity maintained and controlled the property giving rise to the injury. Price doesn’t allege that the sheriff owned, operated or controlled any portion of the county road, and absent this ownership or control, the sheriff had no duty to warn of a hazardous condition, wrote Justice Robert Rucker.

Justice Steven David wrote a concurring opinion, in which Justice Brent Dickson joined, because he was concerned the majority’s decision could be interpreted too broadly. He wrote of a scenario where a sheriff may discover a bridge had been washed away and failed to do anything. In that scenario, a sheriff may have a duty to exercise ordinary and reasonable care by warning the highway department and remaining on the scene until assistance arrives.

“… I concur in the outcome of this particular case but am hesitant for the subsequent application of this holding that the sheriff can escape any liability on the basis of non-maintenance and control of the county roadway,” he wrote. 

Janus Capital Group Inc. v. First Derivative Traders, 131 S. Ct. 2296 (2011)

This year, the United States Supreme Court addressed the viability of securities fraud claims against secondary actors.  On June 14, 2011, the Supreme Court in Janus Capital Group Inc. v. First Derivative Traders, 131 S. Ct. 2296 (2011), brought much-needed predictability to the securities markets by articulating a “clean line” separating “those who are primarily liable (and thus may be pursued in a private [Rule 10b-5] suit) and those who are secondarily liable (and thus may not be pursued in private [Rule 10b-5] suit).”  Id. at 2302 n.6.

The Court, in a 5-4 opinion, concluded that Janus Capital Management (“JCM”), a registered investment adviser, could not be held liable in a private Rule 10b-5 suit for drafting allegedly misleading prospectuses issued by its mutual-fund client, the Janus Investment Fund.  Instead, the Court made clear that the only proper defendant in a private Rule 10b-5 suit is the “maker” of the statement—“the person or entity with ultimate authority over the statement, including its content and whether and how to communicate it.”  Id at 2302.  “Without control,” the Court explained, “a person or entity can merely suggest what to say, not ‘make’ a statement in its own right,” and therefore “[o]ne who prepares or publishes a statement on behalf of another is not its maker.”  Id (quoting 17 C.F.R. § 240.10b-5(b))...

Applying this test, the Court concluded that “JCM did not ‘make’ any of the statements in the [Janus Investment Fund's] prospectuses”--even if it may have participated in the writing and dissemination of the prospectuses--because JCM’s involvement was “subject to the ultimate control” of the Janus Investment Fund.  Id at 2305.  “There was no allegation that JCM in fact filed the prospectuses and falsely attributed them to Janus Investment Fund,” the Court noted, “[n]or did anything on the face of the prospectuses indicate that any statements therein came from JCM rather than from Janus Investment Fund--a legally independent entity with its own board of trustees.”  Id  Accordingly, the statements in the prospectuses were made by Janus Investment Fund--not by JCM.  Id at 2304-05....

Even though the opinion does not expressly address the liability of persons or entities other than investment advisers who provide services to public companies, those service providers--bankers, lawyers, accountants, financial advisers, and others--should be able to invoke the decision to defend private lawsuits based on their work behind the scenes in preparing offering documents for their issuer clients.  The issuer--not the service provider--has “ultimate authority over the statement[s]” in its offering documents, and it is therefore the only “maker of [those] statement[s]”" under the Court’s rationale.  Id at 2302..

The U.S. Supreme Court's decision in Janus Capital Group, Inc. v. First Derivative Traders has left many investment company directors wondering whether they should take additional measures either to protect their funds and themselves from liability for prospectus errors or to provide their funds' investment adviser with additional incentives to ensure the accuracy and completeness of fund prospectuses.