In a major win for consumers, the United States Supreme Court ruled last week that companies cannot moot a class action by offering a full settlement to an individual plaintiff.
In Campbell-Ewald v. Gomez, a consumer (Gomez) sued a U.S. Navy advertising partner (Campbell-Ewald) individually and on behalf of a class for violations of the Telephone Consumer Protection Act. Campbell-Ewald offered Gomez $1,503 for each unsolicited text message, more than three times the statutory amount of $500 per violation. Gomez rejected the offer. Campbell-Ewald argued that, because it had offered Gomez more than he could possibly recover on an individual basis, the case was moot.
In a 6-3 ruling by Justice Ruth Bader Ginsburg, the justices rejected Campbell-Ewald’s argument. “We hold today…that an unaccepted settlement offer has no force,” the opinion said. “Like other unaccepted contract offers, it creates no lasting right or obligation. With the offer off the table, and the defendant’s continuing denial of liability, adversity between the parties persists.”
“When the settlement offer Campbell extended to Gomez expired, Gomez remained empty handed,” Justice Ginsburg wrote. “In short, with no settlement offer still operative … both [parties] retained the same stake in the litigation they had at the outset.”
Justice Ruth Bader Ginsburg delivered the opinion of the court, which Justices Anthony Kennedy, Stephen Breyer, Sonia Sotomayor and Elena Kagan joined. Justice Clarence Thomas filed an opinion concurring in the judgment. Chief Justice John G. Roberts filed a dissenting opinion, in which Justices Antonin Scalia and Samuel Alito joined. Alito additionally filed a separate dissenting opinion.
If you have questions about consumer class actions (unsolicited texts, unlawful debt collection, or deceptive advertising), contact the attorneys at Ford & Diulio PC by email lawyers@forddiulio.com or by phone 714-384-5540.