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Supreme Court Divided on Moot Case Criteria

A case that has been resolved by a court of law is called a "moot case." Cases can be resolved several ways, one of which includes two parties reaching an agreement through a settlement. The standards for a moot case sound simple enough, but a recent issue brought to the U.S. Supreme Court questions whether a settlement offer that would fulfill all of the plaintiff's demands should also constitute as making the case moot.

The Ninth Circuit's appellate panel revived a proposed Telephone Consumer Protection Act ("TCPA") class action over allegedly unsolicited text messages in Campbell-Ewald Co. v. Gomez, No. 13-55486 (9th Cir. 2014). The previous decision granted the U.S. Navy advertising partner, Campbell-Ewald Co. ("Campbell-Ewald"), summary judgment and dismissed the putative class action because it found the company's affiliation with the Navy conferred immunity from the TCPA, which could not be used against the government. However, the Ninth Circuit's decision held that the ad agency was not immune because there was no authority that exempted a marketing consultant from federal tort liability. Campbell-Ewald challenged the court's remand by bringing the case to the high court, but focused on a different issue of law.

Campbell-Ewald also argued that the case of Plaintiff, Jose Gomez ("Gomez"), was moot and required guidance from the high court because it offered Gomez a $1,500 deal that satisfied the maximum penalty per violation under the TCPA. However, Gomez also sought attorneys' fees, which were not addressed or provided for in the settlement offer. If the case was considered moot, then the question of whether the Plaintiff was entitled to attorneys' fees, and similar claims that were not addressed in the offer, would be disregarded as not being justiciable.

At oral argument before the U.S. Supreme Court, Justice Elena Kagan insisted that, if there was a dispute about what the plaintiff was entitled to receive, then those questions still needed to be adjudicated. Thus, the case could not be considered resolved at the stage of an offer, and the plaintiff had the right to get a judgment before the case closed.

Justice Antonin Scalia was skeptical of Justice Kagan's argument, and analogized that a plaintiff could then get away with asking for the key to Fort Knox in order to save a lawsuit from being mooted.

The perceived tie-breaker on the issue, Justice Anthony Kennedy, questioned how a settlement could be enforced without a court order.

Ironically, the questions posed at the oral argument before the Supreme Court did not squarely address what this case really is about. The critical issue underlying this case is the question of whether a defendant can moot a class action plaintiff's case by simply offering the individual plaintiff "full" relief and thereby mooting the case as to the individual plaintiff and the entire, proposed class. If the Supreme Court holds that a settlement offer is sufficient to make a case moot, then it would also be sufficient to eliminate potential class actions. In that case, many believe that companies and other defendants would be incentivized to effectively shut down class actions by making an early offer to the individual plaintiff in a case. Somewhat surprisingly and disappointingly, the issue was not addressed by the Supreme Court at oral argument. SFMS will follow the proceedings in the case closely as it has critical implications for many clients.

The legal team at SFMS has significant experience litigating consumer protection matters. If you have any questions regarding this subject or this posting, please contact Chiharu Sekino ([email protected]) or Alec Berin ([email protected]). We can also be reached toll-free at (866) 540-5505.

Shepherd, Finkelman, Miller & Shah, LLP is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, Pennsylvania and Wisconsin. SFMS also maintains affiliate offices in London, England and Milan, Italy, and is an active member of Integrated Advisory Group (www.iaginternational.org), which provides our firm with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please visit us at www.sfmslaw.com.

Sources:

Campbell-Ewald Co. v. Gomez, case number 14-857, in the Supreme Court of the United States.

Weinberger, Evan. "High Court Split Forms On Whether Offers Moot Cases." Law360. Last modified on October 14, 2015.

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