Supreme Court Grants Certiorari In TCPA Case That May Determine Whether An Offer Of Complete Relief Moots A Class Action

On May 18, 2015, the United States Supreme Court granted certiorari in a matter that may decide a fundamental question in class actions in general and class actions under the Telephone Consumer Protection Act ("TCPA") in particular: whether a case becomes moot, and thus beyond the judicial power of Article III, when the plaintiff receives an offer of complete relief on his or her claim. See Campbell-Ewald Co. v. Gomez, No. 14-857 (U.S.), cert. granted, 5/18/15.

The Circuit Split on Rule 68 Offers of Judgment

In TCPA class actions (and class actions involving other consumer claims), defendants have often offered the plaintiff a judgment pursuant to Rule 68 that is equal to or greater than the plaintiff's maximum statutory damages under the applicable statute. Those efforts have met with mixed results, resulting in a significant circuit split.

The Third, Fourth, Fifth, Sixth, and Seventh Circuits have held that when a Rule 68 offer fully satisfies a plaintiff's claim, the individual claim is mooted. See, e.g., Weiss v. Regal Collections, 385 F.3d 337, 340 (3d Cir. 2004); Warren v. Sessions & Rogers, P.A., 676 F.3d 365, 371 (4th Cir. 2012); Krim v. pcOrder.com, Inc., 402 F.3d 489, 502 (5th Cir. 2005); O'Brien v. Ed Donnelly Enters., Inc., 575 F.3d 567, 574-75 (6th Cir. 2009). In addition, the Third and Seventh Circuits have held that an offer of complete relief to the plaintiff before it moves for class certification "will generally moot the plaintiff's [individual] claim, as at that point the plaintiff retains no personal interest in the outcome of the litigation." Weiss, 385 F.3d at 340; Damasco v. Clearwire Corp., 662 F.3d 891, 895 (7th Cir. 2011).

In contrast, several circuits (including the Ninth and Eleventh) have held that a rejected Rule 68 offer of judgment does not moot the controversy. See McCauley v. Trans Union, L.L.C., 402 F.3d 340, 342 (2d Cir. 2005) (while case is not moot, the court should enter judgment in the amount of the offer); Diaz v. First Am. Home Buyers Prot. Corp., 732 F.3d 948, 954 (9th Cir. 2013); Lucero v. Bureau of Collection Recovery, Inc., 639 F.3d 1239, 1249 (10th Cir. 2011) ("[A] nascent interest attaches to the proposed class upon the filing of a class complaint such that a rejected offer of judgment ... does not render the case moot under Article III".); Stein v. Buccaneers Ltd. P'ship, 772 F.3d 698, 709 (11th Cir. 2014).

Campbell-Ewald and the Mootness Issue

Campbell-Ewald thus presents a familiar fact...