Hunton Retail Law Resource

We previously reported on the United States Supreme Court’s decision in Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663 (2016), wherein a 6-3 majority held that “an unaccepted settlement offer or offer of judgment does not moot a plaintiff’s case.” As part of its decision, however, the Supreme Court expressly left open one critical question: whether a defendant can moot a case by tendering—as opposed to simply offering—complete relief to the plaintiff. The Ninth Circuit has now weighed in on that issue and has answered that question in the negative.

In Chen v. Allstate, No. 13-16816 (9th Cir.), a three-judge panel specifically addressed whether a class action would be rendered moot “if a defendant deposits the full amount of the plaintiff’s individual claim in an account payable to the plaintiff, and the court then enters judgment for the plaintiff in that amount” – i.e., the very question left open by the Supreme Court in Campbell-Ewald. The Ninth Circuit answered no:

• The panel acknowledged that the judgment to which the defendant, Allstate, had consented would have afforded the plaintiff complete relief on his individual claims for damages and injunctive relief.
• However, the panel held that the plaintiff did not “actually receive” complete relief on his claims; thus, according to the panel, the plaintiff’s individual claims were not moot. Stated differently, a mere offer or tender of complete relief would not do.
• The panel further refused to direct the district court to enter judgment on the plaintiff’s individual claims before he had a “fair opportunity to move for class certification.”
• The panel similarly held that, even if the plaintiff’s individual claims otherwise were fully satisfied, he nonetheless could continue to seek class certification under prior Ninth Circuit precedent, Pitts v. Terrible Herbst, Inc., 653 F.3d 1081 (9th Cir. 2011), which, according to the panel, remains good law.

In the end, the panel seemingly moved the goalpost even further for defendants on this issue. A plaintiff’s individual claim cannot be mooted unless he or she actually receives complete relief on the claim; even a tender of complete relief will not do. Moreover, even if a plaintiff’s individual claim could be mooted over his or her objections, he or she would be entitled to a “fair opportunity” to seek class certification nonetheless.