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Class Action Defense Cases—In re Novartis: Judicial Panel On Multidistrict Litigation (MDL) Grants Defense Motion To Centralize Two Employment Law Class Action Lawsuits In The Southern District Of New York

Judicial Panel Grants Unopposed Defense Request for Pretrial Coordination of Two Class Action Complaints Pursuant to 28 U.S.C. § 1407

Plaintiffs filed two class action lawsuits in federal court against Novartis Pharmaceuticals Corp. (NPC), Novartis Corp., Novartis Finance Corp., and Novartis Services, Inc., alleging violations of state and federal labor laws concerning compensation for overtime; specifically, the complaints alleged that defendants had misclassified NPC sales representatives as exempt from overtime pay. In re Novartis Wage & Hour Litig., 460 F.Supp.2d 1382 (Jud.Pan.Mult.Lit. 2006). Pursuant to 28 U.S.C. § 1407, defense attorneys moved the Judicial Panel on Multidistrict Litigation (MDL) to centralize the lawsuits for pretrial purposes in the Southern District of New York, where one of the lawsuits was pending. Id. The motion was unopposed. The Panel agreed with defense attorneys that centralization was warranted even though only two class action lawsuits had been filed, and agreed further – in accord with the agreement of the parties – that the Southern District of New York was the appropriate transferee court. Id.

NOTE: This transfer order illustrates (1) that Section 1407 does not require a minimum number of lawsuits be on file in order to warrant transfer, and (2) that the Judicial Panel independently determines whether centralization is warranted and, if so, the appropriate transferee court. Despite the agreement of the parties, the Judicial Panel explained that it selected the Southern District of New York based on its independent evaluation:

The action pending in the Southern District of New York potentially encompasses a broader group of employees, because plaintiffs in that action seek certification as a collective action on behalf of NPC sales representatives nationwide. Also, all defendants have a presence in this district, and NPC has its headquarters in nearby New Jersey. Accordingly, relevant witnesses and documents will likely be found in or around this district.