On September 9, 2014, in Campbell Ewald Co. v. Gomez, 768 F.3d 871 (9th Cir. 2014), the Supreme Court held that Campbell Ewald could be held liable under the Telephone Consumer Protection Act (TCPA) for text messages it sent to individuals concerning Navy recruitment. The Court found that the plaintiff’s individual claim was not moot, although the plaintiff refused to accept a settlement offer under the Offer of Judgment Rule (Federal Rule of Civil Procedure, FRCP, 68).
Campbell Ewald offered the plaintiff the full measure of damages available – totaling $1,503 per violation. Conversely, the plaintiff rejected this offer. Campbell Ewald moved to dismiss the case under FRCP 12(b)(1), arguing that by the plaintiff rejecting the offer, the personal and punitive class claims were moot.
The plaintiff supported this motion by relying on the Supreme Court holding in Genesis Healthcare Corp. v. Synczyk. However, the Ninth Circuit rejected the use of Genesis as a controlling case because the Genesis holding involved a collection action brought pursuant to the Fair Labor Standards Act – which does not apply to class actions brought under FRCP 23.
On May 18, 2015, the Court granted a writ of certiorari to address the following:
- Whether a case becomes moot when the plaintiff receives an offer of complete relief on his claim;
- Whether the answer to question 1 changes when the plaintiff has asserted a class claim under FRCP 23, but receives an offer of complete relief before any class is certified; and
- The applicability of the doctrine of derivative sovereign immunity.
As of now, a plaintiff’s damages under the TCPA are specified by statute and easily ascertainable. If the Court agrees with Campbell Ewald, a TCPA defendant will be allowed to address a plaintiff’s specific damages without having to worry about a potential class of plaintiffs. However, if the Court disagrees with Campbell Ewald, a TCPA defendant will need to reconsider its defense against class action complaints.
To read more about the impact of the offer of judgment in TCPA class actions, created by the National Law Review, click here.