VW Litigation Spawns A Lawyer Brawl

Following the revelation that VW had fraudulently rigged its diesel automobiles to pass environmental tests, lawsuits were immediately filed against VW all across the country. It is estimated that 350 lawsuits have been filed. Some of these lawsuits are what are commonly known as “class action suits”. 

    A class action suit is a lawsuit filed in the name of one or more people who have been injured or economically damaged by the wrongful conduct of a defendant. The lawsuit seeks to recover damages for the named plaintiffs and “all those similarly situated”, even though those similarly situated persons are not specifically named in the lawsuit. For example, lawsuits have been filed for the benefit of all persons who bought VW diesel cars in a particular state. 

    With 350 or more lawsuits being filed all over the country, it makes sense to wonder how all of them can be managed efficiently and expeditiously through the legal system. 

    Within the federal legal system, there is a six-judge committee known as the Judicial Panel on Multidistrict Litigation. The panel will decide where all of the federal cases will be consolidated. Needless to say, lawyers from Texas want the cases in Texas; lawyers from California want the cases there; and so on and so on. These lawyers are vitally interested in the outcome of that decision because they all believe they have a better chance of being appointed to the “plaintiffs’ steering committee” if the cases are consolidated in their home state or in a court where they believe they have a good relationship based on prior experience with the judge in similar cases. Why is being on the plaintiffs’ steering committee important? There are basically two reasons: money and influence. 

    The lawyers on the steering committee receive a bigger share of the fees because, in theory, they do more work and incur more expenses and that work and those expenses benefit lawyers who are not on the committee and the clients of those lawyers. And, with billions of dollars likely to be paid in settlement, the stakes are high.  The second reason, influence, is also important. The lawyers on the steering committee will have almost total control over the critical decisions that will determine the course and outcome of the litigation. This influence will ultimately determine if the cases are settled, the amount of the settlement, and a method for determining who gets what out of the settlement. 

    Needless to say, the process is messy and ugly. You would be justified in having a mental picture of making sausage or buzzards circling.