Just days ago I wrote about a district court opinion rejecting a tender of complete relief to pick off a named class representative’s claim in a putative TCPA class action. Well today the Second Circuit Court of Appeal has weighed in on the issue and rejected the idea that a deposit of funds with the Court via Rule 67 offered a Plaintiff “complete relief”– he or she must be permitted to take a shot at certification before the individual claim can be effectively mooted. See Geismann v. Zocdoc, Inc., Case no. 17-2692, 2018 U.S. App. Lexis 33201 (Nov. 27, 2018 2nd. Cir).
I went through the background on mootness and pick off moves in my previous article, so I’ll keep this one brief.
In Geismann the Defendant had deposited $20k in the court’s coffers pursuant to Rule 67 and then begged the Court to enter judgment against it, including an injunction preventing future misconduct. The $20k was more than the Plaintiff could possibly have recovered on his individual claim for receipt of a couple of junk faxes, but far less than could have been recovered on the claims of unnamed class members who also allegedly received junk faxes.
The district court granted the Defendant’s request to deposit the $20k into the court’s registry and also entered judgment against the Defendant. Plaintiff appealed the judgment even though he had seemingly won all he could recover. His argument was that Defendant’s pick off move had not really mooted his claim because he still wanted to represent a class of individuals that had suffered similar “harms” at the hands of the Defendant.
On Appeal the Second Circuit panel first looked at the effect of a deposit via Rule 67. The Court found the deposit to be a mere “tender” of sums that is no different than an “offer” of sums made pursuant to Rule 68. In the Geismann’s court’s words:
we see no material difference between a plaintiff rejecting a tender of payment (pursuant to Rule 67) and an offer of payment (pursuant to Rule 68). Indeed, other than their labels, once rejected, the two do not differ in any meaningful way: In each case, ʺall that exists is an unaccepted contract offer, and as the Supreme Court recognized, an unaccepted offer is not binding on the offeree.
Geismann at *15-16.
While the Court’s doctrine is pleasantly definitive it doesn’t seem to be correct. While a mere offer of relief is, in fact, a nullity upon rejection, the tender of full relief does have some legal effect in most jurisdictions. Indeed, the Commercial Code stipulates that issuance of a check suspends the validity of an obligation just as if funds had actually been received. See Comm. Code Section 3-310. This seems to have been what Justice Thomas had in mind in his dissent in Cambepell Ewald when he discussed the effect of legal tender on an obligation.
No matter, the Second Circuit determined that the deposit of funds via Rule 67 is no different than the Court holding the money in escrow–it is not a real delivery of funds to the Plaintiff at all.
Transcending Rule 67, however, Geismann recognizes that a case is mooted when a defendant surrenders “complete relief” in satisfaction of a Plaintiff’s claims. Geismann at * 19. But:
a judgment satisfying an individual claim does not give a plaintiff . . . exercising [its] right to sue on behalf of other[s] . . . ‘all that [it] has . . . requested in the complaint (i.e., relief for the class.)
Geismann at *20-21.
So there’s a solid take away. In the Second Circuit an offer of relief to an individual Plaintiff does not afford complete relief because the Plaintiff is seeking recovery on behalf of others.
Wait a minute.
What individual right does a person have to seek recovery for someone else that affords standing?
There’s not much explanation in Geismann as to how a Plaintiff’s subjective desire to represent a class creates an ongoing controversy capable of judiciability–at best it seems the controversy is whether the Plaintiff has standing to represent the class after his claims are mooted, which is the very controversy resolved by the district court. How can that controversy give the Plaintiff the right to represent the class if the answer to the question is otherwise “no?” Seems like bootstrapping.
Nonetheless, the Second Circuit was moved by the immortal– if unsupported–words of the Campbell-Ewald decision that “a would-be class representative with a live claim of [its] own must be accorded a fair opportunity to show that certification is warranted.” Geismann at *21, citing Campbell-Ewald, 136 S., Ct. at 672. Thus it reversed the district court’s entry of judgment in the case and sent the matter back down for further proceedings.
Interestingly, the ruling in Geismann is unlikely to have any real world impact on the parties before the court. All that has to happen is the the district court must now consider Plaintiff’s certification bid before entering judgment. Considering that the Court felt that the case should go away it seems very unlikely that the district court is now going to turn around and certify the case. Instead it will likely deny certification and–given the very broad discretion courts have in assessing certification issues– such a denial of certification will almost certainly be upheld on appeal. So Plaintiff will not net much, if anything, from this adventure. Indeed we can expect the district court’s denial of certification to turn, in part, on the lack of adequacy of the Plaintiff to represent the class owing to the fact that his own claim has been fully satisfied. Fun stuff.
For the rest of in TCPAland, however, the Geismann ruling continues to chip away at the idea that TCPA class representatives can be picked off via tender of complete relief to an individual plaintiff. Even if the law is not doctrinally sound, it is clear in the Second Circuit–such claims cannot be mooted by deposit of funds with the court sufficient to satisfy a claim.