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RESPONSE IN OPPOSITION -- (re: pldg. ( 1 in MDL No. 2950) ) Filed by Defendants BOK… — Agent Fee Litigation (Dkt. 167)
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A joint memorandum filed June 17, 2020 by BOKF, NA and BOK Financial Corporation with the United States Judicial Panel on Multidistrict Litigation in In re: Paycheck Protection Program (PPP) Agent Fee Litigation, MDL No. 2950, as Document 167. It opposes the motion to transfer as to the only case against the BOK defendants, ImpAcct v. JPMorgan Chase & Co., et al., 20-1344 (D. Colo.). The memorandum gives four reasons: the MDL would be unmanageable, relevant common factual issues do not exist, the only common issues are legal, and any transfer should include only defendants facing multiple actions. It cites In re Credit Union Checking Account Overdraft Litigation among other Panel decisions. The seven-page filing is signed by counsel of Frederic Dorwart, Lawyers PLLC.
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Case MDL No. 2950 Document 167 Filed 06/17/20 Page 1 of 7
BEFORE THE UNITED STATES JUDICIAL PANEL
ON MULTIDISTRICT LITIGATION
IN RE: Paycheck Protection Program (PPP)
Agent Fee Litigation MDL No. 2950
JOINT MEMORANDUM OF BOKF, NA AND BOK FINANCIAL CORPORATION
IN OPPOSITION TO MOTION TO TRANSFER FILED BY ALLIANT GROUP LLC
BOKF, NA and BOK Financial Corporation (collectively “the BOK defendants”) file
their response in opposition to Alliant’s Motion to Transfer the sole case filed against
them, ImpAcct v. JPMorgan Chase & Co., et al., 20-1344 (D. Colo.) (Doc. No. 1-12). The
Transfer Motion does not satisfy the requirements of 28 U.S.C. §1407, and ImpAcct’s suit
against the BOK defendants should remain in the District of Colorado to be determined
on its own merits as to federal and Colorado law.
The Transfer Motion should be denied as to the BOK defendants for 4 separate
reasons: (i) the MDL, if constituted as requested, would be enormous and unmanageable;
(ii) relevant common factual issues do not exist; (iii) the only truly common issues are
those of law; and (iv) transfer to MDL 2950, if any, should include only those defendants
that are facing multiple actions, and not the BOK defendants.
First, an unmanageably gargantuan MDL awaits: The memorandum supporting
transfer notes that “[a]s of May 19, 2020, the SBA has approved over 1.6 million PPP
loans for small businesses through almost 5,000 lenders.” Doc. No. 1-1, Memorandum,
at p. 3. It claims that so far the government has paid nearly $20 billion dollars in lenders
fees, “a substantial portion of which is owed by the PPP lenders to the plaintiffs as PPP
Agents.” Id. Alliant speculates that the number of PPP lender defendants could “increase
into the thousands.” Memorandum, p. 7 (emphasis added).
Case MDL No. 2950 Document 167 Filed 06/17/20 Page 2 of 7
The Transfer Motion nevertheless seeks to have all future related and “tag-a-long”
cases centralized. Doc. No. 1.
The Panel has been here before. In 2009, the Panel established a multidistrict
litigation docket and centralized all federal suits against banks’ checking account
overdraft practices. See, In re: Checking Account Overdraft Litigation, 626 F.Supp.2d
1333, 1335 (J.P.M.L. 2009) [MDL No. 2036]. Seven years later, a similar request was
made to centralize all credit union checking account overdraft litigation. In In re Credit
Union Checking Account Overdraft Litigation, 158 F.Supp.3d 1363 (J.P.M.L. 2016), the
Panel rejected centralization. Reflecting on the earlier bank overdraft MDL, the Panel
cautioned:
A review of the briefs submitted in connection with [the motion to
transfer the bank MDL] indicates that no party raised serious concerns
regarding the potential scope of the MDL or the logistical and other
difficulties that might arise if the litigation expanded, as it did, to
include numerous other unrelated financial institutions. And, although
the MDL has proceeded successfully under the able supervision of the
Honorable James Lawrence King, we note that the Panel, after consulting
with Judge King, ceased transferring tag-alongs to it in September 2011. In
doing so, the Panel concluded that the continued inflow of new actions
“threaten[ed] to significantly hinder the resolution of the already-
centralized actions.”
Here, even if other grounds did not already strongly weigh against
centralization, the possibility that this litigation could expand substantially
counsels caution. According to the Towner plaintiff, there are
approximately 6,000 credit unions across the country. Because it is unclear
how many of them utilize an overdraft program like those allegedly used by
the eleven defendants named in these actions, the possibility that the scope
and complexity of this proposed MDL could expand beyond the bounds of
manageability also influences our decision against centralization.
Id., 158 F.Supp.3d at 1365 (internal references omitted; emphasis added). Indeed, the
flood of related cases has already begun to swamp this proposed MDL. In less than a
month, there have been 8 requests to join 21 additional cases to the 12 cases identified
2
Case MDL No. 2950 Document 167 Filed 06/17/20 Page 3 of 7
in the Transfer Motion. 1 The Panel should heed the lessons of MDL No. 2036 and deny
centralization. 2
Second, no true common issues of fact exist: There are no true relevant common
issues of fact among the cases sought to be centralized. There are 13 unique plaintiffs
and 83 unique defendants in the 12 cases for which the Transfer Motion seeks
consolidation. Memorandum, p. 4. The alleged factual questions listed on pp. 8-9 of the
Transfer Motion are nothing more than abstract generalizations distilled from the plaintiffs’
common legal claims. There are no allegations of conspiracy or concerted action by the
defendant banks, nor even any allegations that the banks all adopted the same policy or
practices. As the Sixth Circuit Court of Appeals observed (discussing common questions
of fact for class action certification): “[i]t is not every common question that will suffice,
however; at a sufficiently abstract level of generalization, almost any set of claims can be
said to display commonality. What we are asking for is a common issue the resolution of
which will advance the litigation.” Sprague v. GM Corp., 1323 F.3d 388, 399 (6th Cir.
1998).
The Panel’s reasoning in support of its decision to deny centralization of insurance
claims due to hurricane flood-caused damages, applies equally here:
These actions possess only a superficial factual commonality—all plaintiffs
allege that they suffered property damage as a result of one or another of
several hurricanes, and that their respective insurance companies
breached the terms of plaintiffs’ policies by settling plaintiffs’ claims for
1See, Doc. No. 25 (one related action); No. 88 (two related actions); No. 98 (seven related
actions); No. 111 (two related actions), No. 134 (two related cases); No. 135 (four related
cases); No. 143 (two related cases); Doc. 157 (1 related action).
2“A broad factor that is rarely discussed by the Panel, but undoubtedly weighs into the
analysis of whether to order transfer, is the general track record in similar cases. . .” Herr,
Multidistrict Litigation Manual, §5:31.
3
Case MDL No. 2950 Document 167 Filed 06/17/20 Page 4 of 7
amounts lower than the losses actually sustained. Each case necessarily
involves a different property, different insureds, different witnesses, different
proofs of loss, and different damages. The very nature of the cases ensures
that unique issues concerning each plaintiff’s loss, claim, investigation, and
claim handling will predominate, and will overwhelm any efficiencies that
centralization might achieve.
In re: Florida, Puerto Rico, and U.S. Virgin Islands 2016 Hurricane Seasons Flood Claims
Litigation, 325 F. Supp.3d 1367, 1368-69 (J.P.M.L. 2018). 3
The ImpAcct action itself joins multiple defendants in one complaint and in one
common set of generic allegations; however, the claims against the BOK defendants are
completely unconnected factually to the claims made against the other ImpAcct
defendants. As in the other cases, no allegations of conspiracy or combination are made,
which militates against consolidation. See, In re Pharmacy Benefit Plan Administrators
Pricing Litigation, 206 F. Supp.2d 1362, 1363 (J.P.M.L. 2002) (absence of any claim of
conspiracy among defendants noted as factor supporting denial of centralization).
3See also, In re Provident Securities Litigation, 2010 Westlaw 2244367 (J.P.M.L., June 3,
2010) (“common factual backdrop” among claims that various brokers had facilitated a
Ponzi scheme by offering and selling oil and gas interests to the plaintiffs and wasted the
proceeds was insufficient to justify centralization, because discovery would be different
due to the differing conduct of the defendants); In re Asbestos and Asbestos Insulation
Material Products Liability Litigation, 431 F. Supp. 906, 909-11 (J.P.M.L. 1977) (the Panel
refused to transfer 103 separate cases brought by workers alleging injury resulting from
exposure to asbestos dust in the course of their employment. The Panel explained that
notwithstanding “a common thread” in the cases - exposure to asbestos in one form or
another – and common questions of fact as to the scientific and medical knowledge of the
defendants, “[t]he liability of each defendant in each action is predominantly an individual
question,” and transfer “would not further the purposes of Section 1407.”); In re Eli Lilly
and Company (Cephalexin Monohydrate) Patent Litigation, 446 F.Supp. 242, 243-44
(J.P.M.L. 1978) (common questions of fact in related patent infringement actions were
insufficient to permit transfer under §1407); In re Repetitive Stress Injury Products Liability
Litigation, 1992 Westlaw 403023, *1 (J.P.M.L. Nov. 27, 1992) (where “degree of common
questions of fact among” 159 actions did not “rise[ ] to the level that transfer under Section
1407 would best serve the overall convenience of the parties and witnesses and promote
the just and efficient conduct of this entire litigation,” transfer denied).
4
Case MDL No. 2950 Document 167 Filed 06/17/20 Page 5 of 7
Plaintiff will have to present evidence unique to the BOK defendants. Indeed, most of the
factual evidence will be unique to the BOK defendants. “[W]hile these . . . actions clearly
share common legal questions and, perhaps, a few factual questions, unique questions
of fact predominate over any common questions of fact.” Id. The claims against the BOK
defendants would have to be severed in any event from the factually unrelated claims
brought against the other ImpAcct defendants. 4
Further, ImpAcct brings its complaint against the BOK defendants as a putative
class action. The class allegations of ImpAcct’s Complaint that the BOK defendants had
a practice of not paying agents’ fees, see, e.g., ImpAcct Complaint, Doc. 1, ¶¶ 51, 66-69
and 80-81, are patently false as can easily be and are properly resolved by the District
Court of Colorado.
There are no common issues of fact, which is the lynchpin of the MDL Docket.
Third, the only common issues are issues of law. The only truly common issues
are issues of the construction and application of the PPP provisions of the CARES Act,
e.g., whether a private cause of action even exists. This Panel recently confirmed that
“common legal questions are insufficient to satisfy Section 1407’s requirement of
‘common factual questions.’” In re Hotel Industry Sex Trafficking Litigation, 2020 Westlaw
4Rule 21 provides that “[t]he court may also sever any claim against a party.” See, e.g.,
U.S. v. Taconic Hills Central School District, 8 F.Supp.3d 339, 344 (S.D.N.Y. 2014)
(relators only asserted that each defendant submitted its own Medicaid bills for services
provided to its own students; “[j]oinder is improper where, as here, the plaintiff does no
more than assert that the defendants merely committed the same type of violation in the
same way.”) (internal citation omitted); DIRECTV, Inc. v. Armellino, 216 F.R.D. 240,
240-41 (E.D.N.Y. 2003) (plaintiff filed action against multiple defendants alleging that
defendants intercepted plaintiff’s cable programing services; each defendant was
involved in a separate and discrete incident; the alleged actions were not related; joinder
improper).
5
Case MDL No. 2950 Document 167 Filed 06/17/20 Page 6 of 7
581882, *2 (J.P.M.L., Feb. 5, 2020). 5
Fourth, at most the Panel should engage in partial transfer. If the Panel chooses
to consolidate some of the cases identified in the Motion to Transfer, it should select only
banks that have multiple suits against them, and allow single suit banks to remain in their
original venues. As Alliant observes “[s]ome of the defendants are named in up to six of
the Related Actions, while others are named in only one.” Memorandum, at p. 5. The
Panel is not constrained to either grant the Transfer Motion in toto, or deny it completely.
As the Multidistrict Litigation Manual notes, “[p]artial transfer is an important tool available
to the Panel to refine the somewhat blunt ‘transfer/no transfer’ decision it must otherwise
make. Where transfer is appropriate for some claims but not others, the Panel can
separate the actions and treat them differently.” Herr, supra, at §5:57. 6
CONCLUSION
The Transfer Motion should be denied as to the BOK defendants. The BOK
defendants have been sued only once concerning their agent fee practice; centralization
will benefit neither the BOK defendants nor the judicial system.
5See also, In Re Veroblue Farms USA, Inc. Litigation, *2 (J.P.M.L., Feb. 5, 2020).
6Section 1407(a) clearly grants the Panel this authority. Herr, supra, at §5:58.
6
Case MDL No. 2950 Document 167 Filed 06/17/20 Page 7 of 7
RESPECTFULLY SUBMITTED,
s/ Frederic Dorwart
Frederic Dorwart, OBA #2436
J. Michael Medina, OBA #6113
Sarah W. Poston, OBA #22925
Frederic Dorwart, Lawyers PLLC
124 East Fourth Street
Tulsa, Oklahoma 74103-5010
Telephone: (918) 583-9922
Facsimile: (918) 583-8251
E-mail: fdorwart@fdlaw.com
mmedina@fdlaw.com
sposton@fdlaw.com
Counsel for Defendants BOK Financial
Corporation and BOKF, NA f/k/a Bank of
Oklahoma
7
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