The U.S. Supreme Court agreed on May 18 to hear an appeal from the U.S. Navy’s advertising partner challenging the Ninth Circuit’s remand of a potential class action over allegedly unsolicited text messages, potentially resolving the issue of whether a putative class claim is mooted by an offer of complete relief under Rule 68 of the Federal Rules of Civil Procedure. Advertising agency Campbell-Ewald Co. began sending text messages through its subcontractor, MindMatic LLC, in 2006 as part of a Navy-approved effort to tap new technologies in recruitment campaigns, the company says. Among the recipients of the message, which began with “Destined for something big? Do it in the Navy,” was the plaintiff who said he never consented to receive the messages. In March 2010 he filed a putative class action accusing Campbell-Ewald of violations of the Telephone Consumer Protection Act. The challenged text messages were sent out to more than 100,000 individuals. In an effort to moot the putative class action, the defendant offered to have judgment entered against it under Rule 68 by the named plaintiff in the amount of $1,503 for each unsolicited text message he received – more than three times the minimum statutory amount of $500 per violation – before the case was certified as a class action. The case was dismissed at the district court level, but it was remanded by the Ninth Circuit. The Supreme Court is now set to consider that reversal.
The questions certified by the Supreme Court are as follows:
- Whether a case becomes moot, and thus beyond the judicial power of Article III, when the plaintiff receives an offer of complete relief on his claim;
- Whether the answer to the first question is any different when the plaintiff has asserted a class claim under Rule 23 of the Federal Rules of Civil Procedure, but receives an offer of complete relief before any class is certified; and
- Whether the doctrine of derivative sovereign immunity recognized in Yearsley v. W.A. Ross Construction Co., for government contractors is restricted to claims arising out of property damage caused by public works projects.
In granting the petition, the Supreme Court is set to potentially resolve the growing split of authority as to whether complete Rule 68 offers of judgment can moot the claims of a putative class representative.
Troutman Sanders LLP will continue to monitor the developments in this important line of cases.