The Eleventh Circuit recently held that a defendant may not moot a class action through an unaccepted Federal Rule of Civil Procedure 68 offer of complete relief to the named plaintiffs—but not to class members—before the named plaintiffs move to certify the class.  In doing so, the Eleventh Circuit joined the majority of circuits that have addressed the same issue.

Named plaintiffs filed a class action in state court against Buccaneers Limited Partnership (“BLP”) alleging BLP sent them and more than 100,000 others unsolicited faxes that advertised tickets to National Football League (“NFL”) games involving the Tampa Bay Buccaneers, and that sending the unsolicited faxes violated the Telephone Consumer Protection Act (“TCPA”).  BLP removed the action to federal court, served each named plaintiff with a Rule 68 offer of judgment in the amount of the maximum damages each could receive under the TCPA, and then, two days later, moved to dismiss for lack of jurisdiction, asserting that the unaccepted Rule 68 offers rendered the case moot.

Named plaintiffs then filed a motion for class certification, which the District Court denied, noting the motion was “terse” and “admittedly (in fact, purposefully) premature.”  Named plaintiffs did not accept the Rule 68 offers, and the deadline to do so passed.  The District Court subsequently entered an order concluding that the action was moot and granting BLP’s motion to dismiss.  Named plaintiffs, who received no money, injunction, or judgment, appealed.

The Eleventh Circuit held that dismissal based on an unaccepted offer is inconsistent with Rule 68, reasoning that when the deadline for accepting the offers passed, the offers were considered withdrawn such that the named plaintiffs still had their claims and BLP still had its defenses.  BLP had not paid the named plaintiffs, was not obligated to do so, and had not been enjoined from sending more faxes.  Thus, the named plaintiffs’ claims were not moot.

The Eleventh Circuit noted that four justices of the United States Supreme Court – the only four who have weighed in on the issue – adopted the same analysis in Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1523 (2013) (Kagan, J., dissenting), and that the Ninth Circuit did as well in Diaz v. First Am. Home Buyers Prot. Corp., 732 F.3d 948, 954055 (9th Cir. 2013).

In addition, the Eleventh Circuit held that even if the individual claims had somehow been deemed mooted by the unaccepted Rule 68 offers, the class claims would remain live, and the named plaintiffs would retain the ability to pursue them, even though the offers were made before the named plaintiff had moved for class certification, so long as the named plaintiffs had not failed to diligently pursue class certification.  The case would still present a live controversy, and the necessary personal stake in a live class action controversy sometimes is present even when the named plaintiff’s own individual claim has become moot.

Stein v. Buccaneers Ltd. P’ship, No. 13–15417, 2014 WL 6734819 (11th Cir. Dec. 1, 2014).