Picking Off Class Representatives with Rule 68 Settlement Offers
The United States District Court for the Southern District of Florida recently joined other courts in holding that a settlement offer to a putative class representative before class certification is sought for all the relief to which the plaintiff is entitled warrants dismissal of the case. In Barr v. Harvard Drug Group, LLC, Case No.: 13-62019, 2014 WL 2612072 (S.D. Fla. June 11, 2014) ( Barr v Harvard Drug), the plaintiff filed a class action complaint alleging violations of the Telephone Consumer Protection Act. On November 27, 2013, at 11:12 a.m., the defendant served a Rule 68 offer of judgment on the plaintiff’s attorney by email and UPS next day delivery for all of the relief that the plaintiff sought in the complaint. At 3:25 p.m. that same day, the plaintiff filed a motion for class certification.
The defendant moved to dismiss the complaint, arguing that the Court lacked subject matter jurisdiction because prior to the plaintiff seeking class certification, the defendant offered the plaintiff all the relief to which he was entitled and, therefore, no controversy between the parties remained. The Court explained that “an actual controversy must be extant at all stages of review, not merely at the time the complaint is filed. If an intervening circumstance deprives the plaintiff of a personal stake in the outcome of the lawsuit, at any point during litigation, the action can no longer proceed and must be dismissed as moot.” Id. at *2. “While the presence of class allegations in the complaint does not save a claim from mootness after named plaintiff’s claim is satisfied, a pending motion for class certification filed before the offer of full relief is tendered may do so.” Id.
Plaintiff, therefore, opposed the motion by arguing that the motion for class certification was filed first and, therefore, a controversy remained. Specifically, the plaintiff argued that service of a Rule 68 offer by email was not permitted by the Rules thereby rendering the 11:12 a.m. transmission of the offer ineffective. The Court, however, held that attorneys who enroll in the Court’s electronic filing system, as plaintiff’s counsel did in this case, consent to accepting electronic service of all documents in a case – whether that document is actually filed with the Court or just served on the parties. Therefore, because “Plaintiff filed his Motion for Class Certification only after the offer of full requested relief had been made, Defendant’s offer eliminated any case or controversy on the merits of Plaintiff’s claim.” Id. at *3.