Ifa plaintiff loses his personal stake in the outcome of a case at any point during litigation, the action must be dismissed as moot.
In January 2016, the Supreme Court in Campbell-Ewald held that a case does not become moot when the plaintiff denies a settlement offer made by the defendant, even when the offer would have satisfied the plaintiff’s claims in a class action suit. The Court stated that although the offer proposed relief for the plaintiff (Gomez), it did not admit the defendant’s liability nor provide relief for the others similarly situated. When Gomez did not accept the offer, the offer was considered to be withdrawn. The Court adopted Justice Kagan’s analysis from her dissent in Genesis Healthcare in 2013, holding that because Gomez gained no entitlement to relief and because the parties remained adverse with the same stakes in the litigation, that the unaccepted offer did not make the case moot.
InApril 2016, a U.S. District Court in Massachusetts applied the Campbell-Ewald holding ina subsequent case, South Orange Chiropractic Center, LLC v. Cayan LLC. In South Orange, facts similar to those in Campbell-Ewald unfolded when an unsolicited fax was sent to the plaintiff (South Orange) in violation of the TCPA. When South Orange filed a proposed class action with itself as class representative, the defendant (Cayan) responded with an offer of judgment under Rule 68 along with a stand-alone settlement offer for South Orange, which included a bank check for $7,500 (an amount in excess of the TCPA’s statutory maximum for unsolicited faxes). Cayan moved to dismiss and to strike the class allegations when South Orange rejected the offers.
In determining whether South Orange’s individual claim was mooted by the unaccepted offer of judgment and settlement offer, the District Court stated that “while the Supreme Court did hold that a plaintiff ‘with a live claim…’ must be given the opportunity to make its case for class certification, it did not determine the legal effect of providing a plaintiff with the fullamount of statutory damages and the fullscope of equitable relief.” Therefore, because Cayan provided the check to the Court, which would satisfy more than all of South Orange’s individual claims and because Cayan’s offer of judgment and settlement offer also enjoined Cayan from sending unsolicited faxes in violation of the TCPA to Plaintiff or any other entity, Cayan not only satisfied all of South Orange’s claims, but it effectively satisfied the claims of those “similarly situated,” unlike the unaccepted settlement offer in Campbell-Ewald. Ultimately, South Orange’s individual claim was correctly held to be moot because of the check provided and additional factors in the Cayan settlement offer that satisfied all of Plaintiff’s claims and more.
In the second half of the South Orangeopinion, the Court determined that the class action still “outlived” the mooted individual claims under the “inherently transitory” exception,because the class issues were likely to evade review and were therefore necessary to adjudicate.