Order Denying Transfer
- Issuer
- U.S. Judicial Panel on Multidistrict Litigation
- Document type
- Order Denying Transfer
- Date
- 2020-08-05
- Case
- In re: Wells Fargo Paycheck Protection Program Litigation
Summary
An Order Denying Transfer issued by the United States Judicial Panel on Multidistrict Litigation in In re: Wells Fargo Paycheck Protection Program Litigation, MDL No. 2954, filed August 5, 2020 as Document 55. The actions involve allegations that Wells Fargo failed to properly process PPP loan applications; a plaintiff in DNM Contracting moved under 28 U.S.C. § 1407 to centralize them. The Panel, after oral argument by videoconference on July 30, 2020, denies the motion, finding that individualized issues about each loan application would diminish efficiencies, that the Ma securities class action raises distinct issues, and that the number of actions is limited. It encourages voluntary coordination among the parties and judges instead. Schedule A lists five actions pending in the Northern and Southern Districts of California, the District of Colorado and the Southern District of Texas.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
Full text
Case MDL No. 2954 Document 55 Filed 08/05/20 Page 1 of 4
UNITED STATES JUDICIAL PANEL
on
MULTIDISTRICT LITIGATION
IN RE: WELLS FARGO PAYCHECK PROTECTION PROGRAM MDL No. 2954
LITIGATION
ORDER DENYING TRANSFER
Before the Panel:* The actions before the Panel involve allegations that Wells Fargo Bank,
N.A. and Wells Fargo & Co. (together, “Wells Fargo”) failed to properly process applications for
loans under the Paycheck Protection Program (“PPP”), a federal loan program established under the
Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) to help small businesses
suffering economic damage from COVID-19 related shutdowns.1 The litigation consists of five
actions pending in four districts, as listed on Schedule A.2 Plaintiff in one Southern District of Texas
action (DNM Contracting) filed a motion under 28 U.S.C. § 1407 to centralize this litigation in the
Southern District of Texas. After responses were filed, plaintiff took the position that one action –
the Ma securities class action involving Wells Fargo’s PPP implementation – was not appropriate
for inclusion because it raised distinct factual and legal issues. At oral argument, movant proposed
the Southern District of California as an alternative transferee district.
Plaintiff in one action (Marselian) supports centralization of all actions in the Northern
District of California. Plaintiff in another action (Karen’s Custom Grooming) opposes centralization
and, alternatively, proposes excluding the Ma securities class action and centralizing the applicant
class actions in the Southern District of California. Plaintiff in Ma opposes centralization of Ma.
Defendant Wells Fargo opposes centralization and, alternatively, proposes the District of Colorado
as the transferee district.
*
Judge Nathaniel M. Gorton and Judge David C. Norton took no part in the decision
of this matter.
1
This docket was heard at the July 30, 2020 hearing session with two other dockets
involving the alleged mishandling of PPP loan applications. See MDL No. 2944, In re: JPMorgan
Chase Paycheck Protection Program Litigation; MDL No. 2952, In re: Bank of America Paycheck
Protection Program Litigation.
2
The motion for centralization listed eight actions for centralization. Subsequently,
one action involving an unrelated agent fees class complaint was removed from the motion for
centralization at the request of movant. See Minute Order, ECF No. 16 (J.P.M.L. June 24, 2020).
Additionally, two actions (Scherer and BSJA, Inc.) were voluntarily dismissed, leaving only five
actions at issue.
Case MDL No. 2954 Document 55 Filed 08/05/20 Page 2 of 4
-2-
On the basis of the papers filed and the hearing session held,3 we will deny plaintiffs’ motion.
Although these actions share factual questions arising out of allegations that Wells Fargo failed to
implement and follow federal regulations requiring that PPP loan applications be processed on a
“first-come, first-served” basis, we conclude that centralization will not serve the convenience of
the parties and witnesses or further the just and efficient conduct of the litigation. In the four PPP
applicant actions on the motion, it appears that individualized factual issues concerning the
circumstances of each loan application will significantly diminish the potential efficiencies from
centralization.4 The Ma securities class action involves further distinct factual and legal issues
particular to investors, as movant concedes in withdrawing its requests for inclusion of Ma.
Additionally, the number of actions is limited and appears unlikely to grow. Two actions (Scherer
and BSJA) have been voluntarily dismissed since the filing of the motion for centralization, and there
are only three potential tag-along actions.
In the present circumstances, voluntary coordination among the parties and the involved
judges is preferable to centralization. We encourage the parties to employ various alternatives to
transfer which may minimize the potential for duplicative discovery and inconsistent pretrial rulings.
Such coordination appears practicable in this litigation, considering the limited number of actions
and districts involved. Additionally, common defendant Wells Fargo is represented by the same
counsel in all actions, and represents in the Panel briefing that it will support informal coordination
of any overlapping discovery and other pretrial activities.
IT IS THEREFORE ORDERED that the motion for centralization of the actions listed on
Schedule A is denied.
3
In light of the concerns about the spread of COVID-19 virus (coronavirus), the Panel
heard oral argument by videoconference at its hearing session of July 30, 2020. See Suppl. Notice
of Hearing Session, MDL No. 2954 (J.P.M.L. July 14, 2020), ECF No. 48.
4
Plaintiffs allege different obstacles to submitting applications, and the record indicates
that some plaintiffs have received PPP loans through Wells Fargo, and other applications have been
withdrawn, approved pending further documentation, or are still pending. These differences will
result in substantial case-specific factual issues, motions, and discovery. See In re Mortgage Lender
Force-Placed Ins. Litig., 895 F. Supp. 2d 1352, 1353 (J.P.M.L. 2012) (denying centralization where
“individualized discovery and legal issues are likely to be numerous and substantial”).
Case MDL No. 2954 Document 55 Filed 08/05/20 Page 3 of 4
-3-
PANEL ON MULTIDISTRICT LITIGATION
Karen K. Caldwell
Chair
Ellen Segal Huvelle R. David Proctor
Catherine D. Perry Matthew F. Kennelly
Case MDL No. 2954 Document 55 Filed 08/05/20 Page 4 of 4
IN RE: WELLS FARGO PAYCHECK PROTECTION PROGRAM MDL No. 2954
LITIGATION
SCHEDULE A
Northern District of California
MA v. WELLS FARGO & COMPANY, ET AL., C.A. No. 3:20-03697
MARSELIAN v. WELLS FARGO & COMPANY, ET AL., C.A. No. 4:20-03166
Southern District of California
KAREN'S CUSTOM GROOMING LLC v. WELLS FARGO & COMPANY, ET AL.,
C.A. No. 3:20-00956
District of Colorado
PHYSICAL THERAPY SPECIALISTS, P.C. v. WELLS FARGO BANK, N.A.,
C.A. No. 1:20-01190
Southern District of Texas
DNM CONTRACTING, INC. v. WELLS FARGO BANK, N.A., C.A. No. 4:20-01790
File and source
- File
- gov.uscourts.jpml.1161957.55.0.pdf
- Size
- 90,348 bytes
- SHA-256
- 25ce92e38eb9e56070d13a38123fac711e70cfc348924b2a61cd2fe5cab7c369
- Original
- storage.courtlistener.com