U.S. Supreme Court rules that unaccepted offer of settlement does not moot class action case

January 21, 2016 by

US Supreme CourtYesterday the U.S. Supreme Court ruled that an unaccepted settlement offer or offer of judgment does not moot a plaintiff’s case.

Campbell-Ewald Co. v Gomez, 577 U.S. ___ (January 20, 2016).  As a consequence the District Court retained jurisdiction to adjudicate Gomez’s complaint.

In a 5-4 decision written by Justice Ginsburg, the Court ruled that Article III’s “cases” and “controversies” limitation requires that “an actual controversy . . . be extant at all stages of review, not merely at the time the complaint is filed,” but a case does not become moot as “long as the parties have a concrete interest, however small,” in the litigation’s outcome.  The Court ruled that Gomez’s complaint was not effaced by Campbell’s unaccepted offer to satisfy his individual claim.

Under basic principles of contract law, Campbell’s settlement bid and Rule 68 offer of judgment, once rejected, had no continuing efficacy.  With no settlement offer operative, the parties remained adverse; both retained the same stake in the litigation they had at the outset.  Neither Federal Rule of Civil Procedure 68 nor the 19th-century railroad tax cases support the argument that an unaccepted settlement offer can moot a complaint.

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Keith Dubanevich
Keith is an accomplished trial, appellate, and healthcare lawyer with over 30 years of experience in more than a dozen different jurisdictions around the country. With a focus on complex dispute resolution, with particular emphasis in the healthcare industry, Keith is adept at handling multi-state and internal antitrust cases, consumer litigation, and securities disputes. In healthcare, he has handled peer review disputes, partnership and incorporation matters, and billing investigations. Keith has led internal investigations for public entities as well as for not-for-profit organizations. Keith's clients value his keen instincts in court and his ability to delve into complex legal issues while never losing sight of the overall strategy of a case. During his time at the Oregon Department of Justice as Associate Attorney General and Chief of Staff, Keith led the creation of a civil rights unit, managed securities litigation including multiple cases against financial services companies, and supervised antitrust investigations and prosecutions. He was also involved with the adoption of legislation that expanded the Unlawful Trade Practices Act and legislation that imposed a mediation requirement prior to non-judicial foreclosures.

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