As we have previously noted, federal appellate courts have been split on whether a defendant can moot a class action by making a Rule 68 offer of judgment, agreeing to pay all of the damages to which the named plaintiff seeks on his individual claim. The split has been narrowing of late, as several courts have decided to follow Justice Kagan's dissenting opinion in the 2013 case, Genesis HealthCare Corp. v. Symczyk.  There, Justice Kagan posited that, under basic contract principles and the language of Rule 68, an unaccepted offer of judgment does not moot the plaintiff's claim.

Today, in Campbell-Ewald Co. v. Gomez, the Supreme Court finally resolved the issue.  In an opinion authored by Justice Ginsburg, a majority of the Court adopted Justice Kagan's reasoning, holding, "in accord with Rule 68 of the Federal Rules of Civil Procedure, that an unaccepted settlement offer has no force," and does not negate the existence of a case and controversy for purposes of Article III jurisdiction. 

Surprisingly, Justice Thomas filed a concurring opinion, in which he disagreed with the majority's reasoning but reached the same result based on "the common-law history of tenders."  He faulted the majority not only for failing to consider this common-law doctrine, but also for "looking only to contract law and one recent Rule 68 opinion," rather than focusing on traditional Article III "case or controversy" jurisprudence. 

In a dissenting opinion, Chief Justice Roberts also criticized the majority for relying on contract law.  "The question . . . is not whether there is a contract; it is whether there is a case or controversy under Article III.  If the defendant is willing to give the plaintiff everything he asks for, there is no case or controversy to adjudicate, and the lawsuit is moot." 

Although defendants may no longer resort to Rule 68 offers of judgment to "pick off" plaintiffs in an effort to moot class actions, the Court did not completely close the door on possible pick off moves.  The majority held:  "We need not, and do not, now decide whether the result would be different if a defendant deposits the full amount of the plaintiff's individual claim in an account payable to the plaintiff, and the court then enters judgment for the plaintiff in that amount.  That question is appropriately reserved for a case in which it is not hypothetical."  Both Chief Justice Roberts and Justice Alito (in a separate dissent) seized on this small opening.  Chief Justice Roberts extolled "the good news . . . that this case is limited to its facts."  He explained: "the majority's analysis may have come out differently if Campbell had deposited the offered funds with the District Court."  Similarly, Justice Alito was "heartened" by this limitation, observing that "[t]oday's decision thus does not prevent a defendant who actually pays complete relief--either directly to the plaintiff or to a trusted intermediary--from seeking dismissal on mootness grounds."  Now that Rule 68 offers are a dead end, some defendants and their counsel who wish to moot class claims will no doubt consider these alternative approaches that seem supported by at least some of the conservative Justices.

The decision also avoided another issue that has vexed the courts - whether mooting the claim of a putative class representative also moots the putative class action, or whether instead the plaintiff may continue to represent the putative class.  Because the Court found that the individual claims were not mooted by the offer of judgment, it did not need to address this question.  Thus, even if a later court accepts the alternative approach that seems to have garnered favor with at least two of the Justices, the successful defendant may still have to persuade the court that the mootness of the named plaintiffs' claim ends the class action.   

At bottom, this case was about power: the power of the federal courts, and the power of the litigants.  Under the majority's analysis, the plaintiff has the power to decide whether his claim is moot (by accepting or rejecting the defendant's offer).  Chief Justice Roberts would give the power to determine mootness to the defendant ("the agreement of the plaintiff is not required to moot a case").  Putting aside Justice Thomas' concurrence with the more liberal majority, the decision reflects yet another split among those Justices who appear to favor class actions and those who don't.  How a majority might resolve the undecided issues is anybody's guess.