11th Circuit Rules Unaccepted Offers of Judgment Do Not Moot Action
With apologies to Tampa Bay Buccaneer fans, I write today about a recent 11th Circuit opinion involving the Buccaneers Limited Partnership (“BLP”) and the more than 100,000 unsolicited faxes sent by BLP, advertising tickets to Tampa Bay NFL games. As a caveat, to my knowledge, BLP is not actually affiliated with the Bucs.
On December 1, 2014, the 11th Circuit released its opinion in Stein v. Buccaneers Limited Partnership, 13-15417 (11th Cir. Dec. 1, 2014). In Stein, BLP was sued in a putative class action under the Telephone Consumer Protection Act (TCPA). In an interesting series of procedural gamesmanship, BLP removed the action; then, three days later, BLP served offers of judgment on each named plaintiff pursuant to Fed. R. Civ. Proc. 68 (which allows the plaintiffs 14 days to accept); and finally, two days later, BLP moved to dismiss the action for lack of jurisdiction, based on unaccepted Rule 68 offers rendering the case moot.
Plaintiffs responded with their own maneuver, moving for class certification the next day. The District Court denied the motion for class certification, but approximately two months later, granted BLP’s motion to dismiss, finding the action moot. As the 11th Circuit noted: “The named plaintiffs received no money, no injunction, and no judgment.” (Slip Op. at 4).
The 11th Circuit notes the appeal presents two issues of first impression in the circuit – “whether an individual plaintiff’s claim becomes moot when the plaintiff does not accept a Rule 68 offer of judgment that, if accepted, would provide all the relief the plaintiff seeks” and “whether, if the answer is yes and such offers are made to all the named plaintiffs in a proposed class action before they move to certify a class, the named plaintiffs may nonetheless go forward as class representatives.” (Slip Op. at 6).
I would have thought the answer to the first issue was a fairly obvious “no.” Much to my surprise, at least two circuits (and loosely the U.S. Supreme Court) have ruled otherwise. See Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1523 (2013); O’Brien v. Ed Donnelly Enters., Inc., 575 F.3d 567 (6th Cir. 2009); McCauley v. Trans Union LLC, 402 F.3d 340 (2d Cir. 2005).
However, the 11th Circuit opted to join the majority of circuits, finding as to issue one that “a plaintiff’s individual claim is not mooted by an unaccepted Rule 68 offer of judgment.” In so doing, the 11th Circuit relied heavily on Justice Kagan’s dissent in Symczyk, where she stated, “An unaccepted offer of judgment cannot moot a case. When a plaintiff rejects such an offer – however good the terms – her interest in the lawsuit remains just what it was before.” 133 S. Ct. at 1533-34 (Kagan, J., dissenting).
The 11th Circuit noted that even in the circuits where an unaccepted Rule 68 offer for full relief does moot an individual claim, it cannot lead to a straight dismissal, but instead, entry of judgment for the plaintiff in the amount of the unaccepted offer. (Stein Slip Op. at 9). Even that did not happen in Stein – the case was simply dismissed as moot, a dismissal the 11th Circuit found to be improper.
As to the second issue, the 11th Circuit ruled (in what can only be viewed as dicta given the ruling on issue one), “a proffer that moots a named plaintiff’s individual claim does not moot a class action in circumstances like those presented here, even if the proffer comes before the plaintiff has moved to certify a class.” (Slip Op. at 23). The 11th Circuit relied heavily on Zeidman v. J. Ray McDermott & Co., Inc., 651 F.2d 1030 (5th Cir. 1981) in so deciding. The Stein opinion actually devotes more discussion analyzing this second issue – a discussion that arguably has more implications for class action practitioners.
So, at least in the 11th Circuit, an unaccepted Rule 68 offer of judgment is simply that – an unaccepted offer – one that cannot be used to moot the plaintiff’s claim. More significantly, even if a named plaintiff’s claims are moot, that named plaintiff can still serve as a class representative going forward.
— A. David Fawal
