Rule 68 offers of judgment have often been rendered almost meaningless in employment class and collective actions amidst criticism by some courts that they would permit employers to “pick off plaintiffs” and to avoid class litigation altogether. As we have noted previously, these courts express little or no sensitivity towards the cost of class or collective litigation on even the weakest of claims, and also presume that if one plaintiff has asserted a claim there must be others as well demanding class action treatment.
The Supreme Court addressed these contentions in the context of Rule 23 class actions in a pair of cases 22 years ago, Guaranty Nat’l Bank of Jackson v. Roper, 445 U.S. 326 (1980) (offer of full relief in consumer case), and U.S. Parole Comm’n v. Geraghty, 445 U.S. 388 (1980) (class action could be maintained after named plaintiff’s claim became moot), and concluded that the mootness of the named plaintiff’s claim would not moot a Rule 23 class. The Supreme Court has not yet addressed, however, whether Rule 68 will work in the context of an FLSA collective action, which is very different from Rule 23 due to its affirmative requirement that plaintiffs actually opt into the litigation.
On June 25, 2012, the United States Supreme Court accepted certiorari in the case of Genesis Health Care Corp., Case No. 11-1059, which concerned the use of offers of judgment in collective action cases. We blogged the original Third Circuit decision on September 8, 2011 and you can access the blog post (and the underlying decision) here.
If the court leaves the Third Circuit holding undisturbed, offers of judgment will remain of limited utility in the collective action context. On the other hand, if the court reverses, Rule 68 offers of judgment may become a viable tool to help stem the enormous cost of collective action litigation. Even better, were the Court to reconsider its 1980 holdings, such a tool will become useful in a wider array of controversies.
The bottom line: The Supreme Court has agreed to consider whether offers of judgment will apply in collective actions before a plaintiff has moved for certification.