Ninth Circuit Ruling Has Potentially Major TPCA Defense Implications

In an earlier blog post, I discussed a recent SCOTUS ruling that defendants facing Telephone Consumer Protection Act lawsuits cannot escape a class action by making a settlement offer to individual plaintiffs (Gomez v. Campbell-Ewald).

The decision continues to have significant ramifications.

While the ruling sets forth that an unaccepted offer of judgment does not moot a plaintiff’s individual claims, it seemingly left the door open on the issue of whether the result would be different if a defendant actually tendered full payment in a controlled account payable to the plaintiff by depositing the funds with the court.

Earlier this week, the Ninth Circuit affirmed the lower court’s ruling and rejected this approach following defendant’s extension of an unaccepted offer of complete relief to plaintiff (Richard Chen et al. v. Allstate Insurance Co.).

In a published opinion the three-judge appellate panel stated that “[a]s we read Campbell-Ewald, a lawsuit — or an individual claim — becomes moot when a plaintiff actually receives all of the relief he or she could receive on the claim through further litigation. “Here, Pacleb has not yet received any relief on his individual claims for damages or injunctive relief. His claims are wholly unsatisfied.”

Interestingly, the panel went further than the U.S. Supreme Court, noting that  deposit of money in court could be treated as the equivalent of an actual payment to the plaintiff if a defendant unconditionally relinquishes its entire interest in the deposited funds. In other words, according to the Ninth Circuit, it is insufficient for a defendant to retain an interest in the funds pending dismissal.

Also noteworthy here is that the Ninth Circuit upheld the lower court’s determination based on the 2011 decision in Pitts v. Terrible Herbst Inc. (class claims cannot be mooted by an attempt by a defendant to “pick off” a lead plaintiff to avoid a class action).  As such, according to the court, the plaintiff in the instant matter would still be able to seek class certification even if his individual claims were nullified.

The recent “plaintiff friendly” opinions, coupled with the proliferation of TCPA class action litigation, clearly illustrate the need for stringent TCPA compliance protocols for companies and their vendors.

Contact the author at rnewman@hinchnewman.com for more information on this subject or to discuss the design and implementation of compliant telemarketing practices.

Information conveyed in this article is provided for informational purposes only and does not constitute, nor should it be relied upon, as legal advice. No person should act or rely on any information in this article without seeking the advice of an attorney.

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