Wyatt Employment Law Report


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Supreme Court Concludes Offer of Judgment Cannot Moot Class Actions

By Douglas L. McSwain and Michael D. Hornback

Every business would like to avoid class actions. Even if an individual class plaintiff’s damages are small, aggregated damages across a sizable class can be staggering.  Of late, businesses have utilized a defense strategy to offer the individually named class plaintiff(s) all of the relief requested (via an “offer of judgment”), prior to the class being certified by the court.  Several courts within the Third, Fourth, and Sixth Circuit Courts of Appeals have held offers of judgment for the full relief sought by the individual class plaintiff, even if not accepted, moots the entire class action, and deprives the court of further jurisdiction to hear the case.  By offering all the relief requested by the class plaintiff, the business could avoid the class action entirely.  The First, Second, Fifth, Seventh, and Eleventh Circuit Courts of Appeals have not bought this defense, and so the United States Supreme Court took up the case of Campbell-Ewald Co. v. Gomez, 577 U.S. ___ (2016), this term to resolve the conflict between the circuits.

On January 20, 2016, the Supreme Court rendered its decision in Campbell-Ewald, holding that an unaccepted offer of judgment has no force and effect, and does not Continue reading