Supreme Court Docket Report - May 18, 2015

Today, the Supreme Court granted certiorari in one case of interest to the business community:

Justiciability—Mootness—Effect of Offer of Judgment Prior To Class Certification

Article III of the Constitution limits the jurisdiction of the federal courts to "cases" and "controversies." The Supreme Court has held that "'an actual controversy ... be extant at all stages of review, not merely at the time the complaint is filed.'" Arizonans for Official English v. Arizona, 520 U.S. 43, 67 (1997). Accordingly, "[i]f an intervening circumstance deprives the plaintiff of a 'personal stake in the outcome of the lawsuit,' at any point during litigation, the action can no longer proceed and must be dismissed as moot." Genesis HealthCare Corp. v. Symczyk, 133 S. Ct. 1523, 1528 (2013). In Genesis, the Court recognized that one "intervening circumstance" may arise under Rule 68 of the Federal Rules of Civil Procedure, which permits a party to offer to allow judgment in favor of its adversary on specified terms. A party who rejects a Rule 68 offer, but obtains a judgment "not more favorable than the unaccepted offer," must pay the costs accrued by the offering party between the offer and judgment.

Today, the Court granted certiorari in Campbell-Ewald Company v. Gomez, No. 14-857, to determine whether a defendant's unaccepted offer of judgment, made before a class is certified, that would fully satisfy the claim of a would-be class representative renders the plaintiff's individual and class claims moot. The Court also granted certiorari to decide whether the derivative sovereign immunity doctrine recognized in Yearsley v. W.A. Ross Construction Co., 309 U.S. 18 (1940), applies only to claims for property damage caused by public works projects.

In this case, respondent Gomez filed a class action alleging that he and other individuals had received unsolicited text messages recruiting for the U.S. Navy without their consent, in violation of the Telephone Consumer Protection Act (TCPA). The Navy had hired petitioner Campbell-Ewald Company to develop a mobile marketing campaign to attract new recruits; the text message Gomez received was part of that campaign. Before a class had been certified, Campbell-Ewald tendered a Rule 68 offer to Gomez, offering to pay him $1503 per violation (slightly more than the full statutory damages available under the TCPA) in addition to certain costs, and to stipulate to an injunction. When Gomez rejected the offer...