On May 18, 2015, the United States Supreme Court granted a petition for a writ of certiorari to address (1) whether a case becomes moot when the plaintiff receives an offer of complete relief on his claim and (2) whether the answer to the first question is any different when the plaintiff has asserted a class claim under Federal Rule of Civil Procedure 23, but receives an offer of complete relief before any class is certified.   The Court will also address the applicability of the doctrine of derivative sovereign immunity.

The case, Campbell-Ewald Co. v. Gomez, No. 14-857, comes before the Court on the petition of Campbell-Ewald after the Ninth Circuit ruled on September 9, 2014, that Campbell-Ewald could be held liable under the Telephone Consumer Protection Act (TCPA) for text messages it sent to approximately 100,000 individuals in connection with Navy recruitment.

In the underlying case, Campbell-Ewald offered the plaintiff, Jose Gomez, $1503 per violation of the TCPA.  The TCPA permits statutory damages ranging from $500 to $1500 per violation.  Accordingly, Campbell-Ewald’s offer would have afforded Gomez his full measure of damages available.  Gomez subsequently rejected the offer by allowing it to lapse in accordance with its terms.  Campbell-Ewald then moved to dismiss the case under Rule 12(b)(1), arguing that Gomez’s rejection of the offer mooted the personal and putative class claims.  In denying Campbell-Ewald’s motion, the Ninth Circuit held that the plaintiff’s individual claim was not mooted by the plaintiff’s refusal to accept a settlement offer under Federal Rule of Civil Procedure 68 – commonly known as the Offer of Judgment Rule.  Additionally, the Ninth Circuit held the putative class claims are not moot because an unaccepted offer of judgment – for the full amount of the named plaintiff’s individual claim and made before the named plaintiff files a motion for class certification – does not moot a class action.  In support of its motion, Campbell-Ewald argued that the Supreme Court’s holding in Genesis Healthcare Corp. v. Symczyk was controlling.  The Ninth Circuit rejected Campbell-Ewald’s assertion finding that the Genesis holding, which involved a collection action brought pursuant to the Fair Labor Standards Act, does not apply to class actions brought under Rule 23 – such as claims for violations of the TCPA.

It is expected that the Supreme Court’s decision in this case will clarify a split among the Circuit Courts as to whether a full offer of relief to the named plaintiff ends the case or not.  As we previously discussed, the Eleventh Circuit, similar to the Ninth Circuit, has held that an unaccepted offer of judgment to a named plaintiff did not moot the named plaintiff’s claims.  In contrast, the Seventh Circuit, has held that an offer of judgment to the named plaintiff, made prior to the filing of a motion for class certification, can moot the class action.  As a plaintiff’s damages under the TCPA are specified by the statute and thus easily ascertainable, this split has likely affected the defense and prosecution of TCPA claims.  In particular, the plaintiffs’ bar may prefer to bring TCPA claims in a Circuit where an offer of judgment cannot render a class action moot; while the defense bar may seek to utilize the offer of judgment to eliminate potential class claims where a limited number of plaintiffs are actually named in the suit.

The Supreme Court’s decision in this case will likely have a significant impact on TCPA claims, as well as class actions brought pursuant to Rule 23.    Should the Court agree with Campbell-Ewald, a TCPA defendant will be permitted to address a specific plaintiff’s damages without concern for a theoretical class of plaintiffs.  By contract, should the court disagree with Campbell-Ewald, defendants will need to reconsider how they defend, and seek to resolve, class action complaints brought under the TCPA.

For additional insight, please see the related post from our Class and Collective Action group.

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Photo of Jason C. Gavejian Jason C. Gavejian

Jason C. Gavejian is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and co-leader of the firm’s Privacy, Data and Cybersecurity practice group. Jason is also a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy…

Jason C. Gavejian is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. and co-leader of the firm’s Privacy, Data and Cybersecurity practice group. Jason is also a Certified Information Privacy Professional (CIPP/US) with the International Association of Privacy Professionals.

As a Certified Information Privacy Professional (CIPP/US), Jason focuses on the matrix of laws governing privacy, security, and management of data. Jason is co-editor of, and a regular contributor to, the firm’s Workplace Privacy, Data Management & Security Report blog.

Jason’s work in the area of privacy and data security includes counseling international, national, and regional companies on the vast array of privacy and security mandates, preventive measures, policies, procedures, and best practices. This includes, but is not limited to, the privacy and security requirements under state, federal, and international law (e.g., HIPAA/HITECH, GDPR, California Consumer Privacy Act (CCPA), FTC Act, ECPA, SCA, GLBA etc.). Jason helps companies in all industries to assess information risk and security as part of the development and implementation of comprehensive data security safeguards including written information security programs (WISP). Additionally, Jason assists companies in analyzing issues related to: electronic communications, social media, electronic signatures (ESIGN/UETA), monitoring and recording (GPS, video, audio, etc.), biometrics, and bring your own device (BYOD) and company owned personally enabled device (COPE) programs, including policies and procedures to address same. He regularly advises clients on compliance issues under the Telephone Consumer Protection Act (TCPA) and has represented clients in suits, including class actions, brought in various jurisdictions throughout the country under the TCPA.

Jason represents companies with respect to inquiries from the HHS/OCR, state attorneys general, and other agencies alleging wrongful disclosure of personal/protected information. He negotiates vendor agreements and other data privacy and security agreements, including business associate agreements. His work in the area of privacy and data security includes counseling and coaching clients through the process of investigating and responding to breaches of the personally identifiable information (PII) or protected health information (PHI) they maintain about consumers, customers, employees, patients, and others, while also assisting clients in implementing policies, practices, and procedures to prevent future data incidents.

Jason represents management exclusively in all aspects of employment litigation, including restrictive covenants, class-actions, harassment, retaliation, discrimination, and wage and hour claims in both federal and state courts. He regularly appears before administrative agencies, including the Equal Employment Opportunity Commission (EEOC), the Office for Civil Rights (OCR), the New Jersey Division of Civil Rights, and the New Jersey Department of Labor. Jason’s practice also focuses on advising/counseling employers regarding daily workplace issues.

Jason’s litigation experience, coupled with his privacy practice, provides him with a unique view of many workplace issues and the impact privacy, data security, and social media may play in actual or threatened lawsuits.

Jason regularly provides training to both executives and employees and regularly speaks on current privacy, data security, monitoring, recording, BYOD/COPE, biometrics (BIPA), social media, TCPA, and information management issues. His views on these topics have been discussed in multiple publications, including the Washington Post, Chicago Tribune, San Francisco Chronicle (SFGATE), National Law Review, Bloomberg BNA, Inc.com, @Law Magazine, Risk and Insurance Magazine, LXBN TV, Business Insurance Magazine, and HR.BLR.com.

Jason is the co-leader of Jackson Lewis’ Hispanic Attorney resource group, a group committed to increasing the firm’s visibility among Hispanic-American and other minority attorneys, as well as mentoring the firm’s attorneys to assist in their training and development. He also previously served on the National Leadership Committee of the Hispanic National Bar Association (HNBA) and regularly volunteers his time for pro bono matters.

Prior to joining Jackson Lewis, Jason served as a judicial law clerk for the Honorable Richard J. Donohue on the Superior Court of New Jersey, Bergen County.