From Hrivnak v. NCO Portfolio Mgmt., Inc., 723 F. Supp. 2d 1020 (N.D. Ohio 2010):
The question posed by Javitch's Motion for Reconsideration is whether a defendant in a putative class-action may moot that action by presenting an offer of judgment under Rule 68 two days after the suit is removed to federal court. *** At issue is "[t]he interplay between Rule 68 and Rule 23 of the Federal Rules of Civil Procedure." Carroll v. United Compucred Collections, Inc., 399 F.3d 620, 624 (6th Cir. 2005). ***
It is normally said that "an offer of judgment that satisfies a plaintiff's entire demand moots the case." O'Brien v. Ed Donnelly Enters., 575 F.3d 567, 574 (6th Cir. 2009); Greisz v. Household Bank, N.A., 176 F.3d 1012, 1015 (7th Cir. 1999) (Posner, J.) ("You cannot persist in suing after you've won."). Rule 68 operates differently in the class action context, however, and "special mootness rules exist . . . ." Brunet v. City of Columbus, 1 F.3d 390, 399 (6th Cir. 1993). For example, "a Rule 68 offer of judgment in a case where class certification is pending but has not yet been granted" will not moot the putative class action. Carroll, 399 F.3d at 624; see also Weiss v. Regal Collections, 385 F.3d 337, 347 (3d Cir. 2004) ("[I]n certain circumstances, to give effect to the purposes of Rule 23, it is necessary to conceive of the named plaintiff as a part of an indivisible class and not merely a single adverse party even before the class certification question has been decided."). ***
As a threshold matter, Javitch claims that a Rule 68 offer of judgment divests a district court of subject matter jurisdiction any time that offer is made prior to the district court's grant of class certification. *** It cites, in particular, a case from the District of New Mexico as setting forth the proper standard within the Sixth Circuit and claims that "a district court 'does not have jurisdiction over a case where no class has been certified but the defendant has satisfied the plaintiff's demand for relief.'" *** This is not the rule, however.
The Sixth Circuit has made it clear that there are circumstances in which a Rule 68 offer of judgment cannot moot a putative class action. *** Once a motion for class certification is pending, for example, a defendant may not subsequently divest a court of subject matter jurisdiction through a Rule 68 offer of judgment. Carroll, 399 F.3d at 625 ("If a tender made to the individual plaintiff while the motion for certification is pending could prevent the courts from ever reaching the class action issues, that opportunity is at the mercy of a defendant, even in cases where a class action would be most clearly appropriate." (quoting Brunet, 1 F.3d at 400)). While the Sixth Circuit has not yet considered whether the principle announced in Carroll extends to the period prior to the filing of a motion for class certification, it is clear that there are at least some circumstances under which it is appropriate to "conceive of the named plaintiff as a part of an indivisible class and not merely a single adverse party even before the class certification question has been decided." ***
Only one circuit has considered whether the named plaintiff can be considered part of "an indivisible class" prior to the filing of a motion for class certification, concluding that he or she can. See Weiss, 385 F.3d at 347. It appears that the majority of district courts are in accord with Weiss, moreover.***
In light of the foregoing, the Court remains persuaded by those courts that treat the plaintiff in a putative class action as part of an indivisible class for purposes of jurisdiction and standing, so long as the plaintiff does not delay in moving for class certification. ***
[T]he likely alternative to this Court's holding is an invitation to procedural gamesmanship. If Carroll means that a Rule 68 offer does not moot claims once a motion for class certification is filed, but not before, every class counsel will be motivated to do as Hrivnak now has done here — file a motion requesting class certification, but asking that the Court to stay briefing on that motion pending discovery. This is the procedure favored by many district courts in the Seventh Circuit. *** While such an approach is not without its appeal, the Court believes the rule of Stewart and Weiss to be preferable to the extent that it discourages premature motion practice and allows the court to set reasonable time frames for the filing of motions for class certification without fear that it has provided a substantial litigation advantage to the defendant by having done so.
Share this article: