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FedEx Has a Long Road to Fight Drivers’ Appeals

CHICAGO (CN) - In a potential split among federal appeals courts, the 7th Circuit agreed that FedEx drivers should have separate proceedings to appeal a decision in multidistrict litigation about their employment status.

U.S. District Judge Robert Miller Jr. in Indiana was tasked in 2005 with overseeing pretrial proceedings for more than 70 class actions against FedEx consolidated for multidistrict litigation (MDL). The cases allege that the company improperly classifies delivery drivers as outside contractors instead of employees, in violation of various state laws.

Miller, described in the 7th Circuit opinion as a member of the U.S. Judicial Panel on Multidistrict Litigation and "a veteran district judge with long experience both as a transferee judge managing MDL cases," ruled that the FedEx drivers were independent contractors as a matter of law and granted summary judgment to FedEx on all but 12 of the claims.

But this decision led to the interesting question of how to proceed with an appeal.

"One option would be to have Judge Miller issue partial final judgments, so that plaintiffs would have to appeal immediately in those cases and the appeals would come to this circuit," Judge David Hamilton wrote. "The second option is to follow the usual course at the end of consolidated pretrial proceedings: transfer the cases with remaining claims back to the original transferee courts for further proceedings, including possible appeal after a final judgment."

FedEx wanted the first option, seeking to limit its time in court. The drivers wanted the cases remanded for separate proceedings.

Miller chose to remand the cases, and the Judicial Panel on Multidistrict Litigation (JPML) adopted his recommendation. FedEx appealed to the 7th Circuit, seeking to reverse the writ of mandamus to the JPML.

Finding "strong arguments for either preference," the federal appeals court declined to overturn the ruling, saying the panel had not abused its discretion.

"The choice between these two methods of case management is best left to the transferee court and JPML, without trying to impose a rigid rule for all cases and circumstances," Hamilton wrote. "The transferee court knows well the issues and dynamics of the particular cases. The JPML brings to bear decades of experience with more than a thousand MDL proceedings, which have included some of the most complex and challenging cases in the history of the federal courts."

At trial, FedEx pointed to a 4th Circuit ruling, In re Food Lion, Inc., Fair Labor Standards Act "Effective Scheduling" Litig., that unraveled orders in a similar case to remand cases back to their originating courts.

"We do not understand the Food Lion majority to have adopted a sweeping holding that all MDL cases must be managed to ensure that all related appeals go to only the circuit with jurisdiction over the transferee court," Hamilton wrote, noting that the claims in that litigation involved violations of federal law.

"What may have been the better way to manage the Food Lion litigation, which involved claims under federal law, is not necessarily the better way to manage these cases, in which the claims arise under similar but not identical state laws."

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