On June 5, the Judicial Panel on Multidistrict Litigation (JPML) in Texas v. Google, LLC ruled that the State Antitrust Enforcement Act of 2021 applies to pending state antitrust enforcement actions, including to actions the JPML previously centralized. Specifically, the JPML ordered that a 16-state multistate attorneys’ general antitrust litigation against Google should be remanded to federal court in Texas.
The JPML’s order is significant because it could lead to remand in several other mammoth multidistrict litigations (MDLs) where state AG litigation remains pending. The order also raises several procedural questions, chief among them the issue of how the states’ unified, amended complaints will be remanded, and whether the plaintiffs waive the right to litigate in their preferred venue. In addition, questions remain as to whether the ruling will withstand appellate scrutiny.
In Texas v. Google, the Texas AG sued Google in the Eastern District of Texas, alleging that Google built an online display advertising monopoly. In 2021, the JPML centralized the Texas-led enforcement action with some 20 similar lawsuits in a multidistrict litigation in the Southern District of New York. Subsequently, in December 2022, Congress passed the Consolidated Appropriations Act, which amended 28 U.S.C. § 1407(g) to exempt state antitrust enforcement actions arising under federal antitrust law from multidistrict litigation.
Based on Congress’ enactment of the Consolidated Appropriations Act, a Texas-led coalition of 16 states moved to remand Texas v. Google to the Eastern District of Texas, arguing that the amendment applied to all pending state antitrust enforcement actions, including previously centralized actions.
The JPML ruled in Texas’s favor, determining the statute applied to pending cases. It noted that the Supreme Court’s decision in Landgraf v. USI Film Prods. established a presumption against retroactive legislation, but it highlighted the Landgraf court’s statement that “[c]hanges in procedural rules may often be applied in suits arising before their enactment without raising concerns about retroactivity.”
The JPML then engaged in a two-part test to determine the proper temporal reach of the new statute. First, it considered whether the statute expressly addresses retroactivity. Because the statute contains no express command, the JPML looked to whether it would have a “retroactive effect” by (1) impairing the rights a party possessed when it acted, (2) increasing a party’s liability for past conduct, or (3) imposing new duties. The JPML concluded the amendment was a “plainly procedural rule” that did not regulate primary conduct and could apply to previously centralized suits without raising concerns about retroactivity. Accordingly, the JPML remanded the case to the Eastern District of Texas.
However, whether the order will be upheld remains to be seen. On June 12, Google filed an emergency motion for stay pending appeal by writ of mandamus. In its motion, Google argued that the panel erred in its Landgraf analysis by relying on the Venue Act’s silence, with respect to its temporal reach, to proceed to the second step of the Landgraf analysis. In doing so, Google argued that the panel ignored Supreme Court precedent rejecting the notion that the only two rules to determine a statute’s temporal reach are either an express command or step two of Landgraf.
Google also argued that Landgraf step-two analysis is erroneous because the “relevant activity,” i.e., transfer, already occurred two years ago when the panel transferred the plaintiffs’ case for coordinated proceedings in the Southern District of New York.
Why It Matters
The JPML’s ruling is significant because it provides state AGs with an opportunity to expedite their pending claims, which often are delayed during the MDL process. Indeed, the explicit purpose of the Venue Act is to give state AGs a “home-field advantage” by preserving their ability to litigate in their preferred venue. On the other hand, the ruling prevents enforcement targets from avoiding duplication of discovery, receiving inconsistent rulings during the pre-trial phase, and conserving judicial resources.
The JPML’s ruling is also noteworthy because it may cause other state enforcement actions to be remanded. In this case, the states requested the JPML to remand the suit to the Eastern District of Texas (known for its expedited trial schedule), but it is unclear how the states’ consolidated claims will be remanded in the future. Moreover, the JPML’s order left open the possibility that a state could waive its venue rights. How a plaintiff might waive such a right is yet to be seen.
The final question is whether this case will withstand appeal. As previously mentioned, Google moved to stay the JPML’s decision pending appeal, and the parties are currently briefing the issue. Given the effect of the JPML’s decision on other pending antitrust enforcement cases, we will likely monitor the decision closely.
Troutman Pepper State Attorneys General Team
|Ashley Taylor – Co-leader and Firm Vice Chair
Ashley is a partner in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group and co-leader of the State Attorneys General practice. He focuses primarily on federal and state government regulatory and enforcement matters involving state attorneys general, the Consumer Financial Protection Bureau (CFPB), and the Federal Trade Commission (FTC). Drawing upon his experience as a deputy attorney general, Ashley has developed an extensive consumer practice with regard to the consumer financial services industry.
|Clay Friedman – Co-leader
Clay is a partner in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group and co-leader of the State Attorneys General practice. Informed by nearly a decade in a state attorneys general office, and more than 25 years in private practice, Clay spends much of his time representing clients in singular or multistate regulatory actions. Clay has repeatedly led teams before all 50 state attorneys general and also handles matters with the Federal Trade Commission, the Consumer Financial Protection Bureau, and other local, state and federal agencies.
Judy is a partner in the firm’s Regulatory Investigations, Strategy and Enforcement (RISE) practice, based in the Richmond office. She brings experience serving as chair and commissioner of the Virginia State Corporate Commission (VSCC) from 2006 through 2022, which includes regulating the utilities, insurance, banking, and securities industries. She also served as Virginia’s attorney general from 2005-2006.
Stephen represents clients interacting with, and being investigated by, state attorneys general and other enforcement bodies, including the CFPB and FTC, as well as clients involved with litigation, particularly in heavily regulated industries.
A former deputy attorney general of New York, Avi applies his experience in bet-the-company matters, representing clients in criminal and civil investigations and enforcement actions before state and federal regulators, prosecutors and enforcement agencies.
Michael handles high-profile state attorneys general, FTC, and CFPB investigations by advising clients through these complex government inquiries. He assists clients through the entire life cycle of investigations, from regulatory enforcement through formal litigation.
As a former government official at the state and federal level, Ketan leverages extensive experience in the public and private sectors to skillfully represent client interests.
Tim is an attorney in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group, with a primary focus on financial services litigation.
Chris represents clients in regulatory, civil and criminal investigations and litigation. In his practice, Chris regularly employs his prior regulatory experience to benefit clients who are interacting with and being investigated by state attorneys general.
Natalia is an associate in the firm’s business litigation practice. She recently received her J.D from the University of California, Davis School of Law.
Namrata is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group, based in the Washington, D.C. office. Her work includes advising clients in regulatory investigations and compliance matters, in addition to representing clients in civil litigation matters.
Michael is an associate in the firm’s Regulatory Investigations, Strategy, and Enforcement Practice Group. Based out of the firm’s Boston office, Mike has deep experience in litigation, investigations, and other regulatory matters involving state-level regulators and state attorneys general.
Susan is an associate in the firm’s Consumer Financial Services Practice Group, and focuses her practice on consumer financial services matters. She has defended several of the nation’s largest and most influential financial institutions in individual and class action litigation involving the Telephone Consumer Protection Act (TCPA), Fair Credit Reporting Act (FCRA), Fair Debt Collection Practices Act (FDCPA), and other consumer privacy statutes. Susan also represents banks, fintechs, and financial services companies in connection with regulatory examinations and investigations brought by the CFPB, state attorneys general, and the California Department of Financial Protection and Innovation.
John represents clients in a wide variety of general and complex litigation matters, shareholder disputes, products liability, and privacy claims.
Whitney is an attorney in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group. She represents clients facing state and federal regulatory investigations and enforcement actions, as well as related civil litigation.
Trey is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement practice. His experience includes serving as a summer associate at the firm in 2021.
An experienced litigator, Daniel advises and represents regional, national and international companies, financial institutions and insurers in all facets of business, complex commercial and insurance coverage litigation. He is committed to working with his clients to find creative solutions to meet their needs.
Stephanie is Troutman Pepper’s senior government relations manager in the state attorneys general department.