Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-13-16816/USCOURTS-ca9-13-16816-0/pdf.json

Parties Involved:
Allstate Insurance Company
Appellant
California Retailers Association
Amicus Curiae
Chamber of Commerce of the United States
Amicus Curiae
Richard Chen
Appellee
Consumer Data Industry Association
Amicus Curiae
National Association of Consumer Advocates
Amicus Curiae
Pacific Legal Foundation
Amicus Curiae
Florencio Pacleb
Appellee
Public Citizen, Inc.
Amicus Curiae

Document Text:

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

RICHARD CHEN; FLORENCIO

PACLEB, on behalf of themselves and

all others similarly situated,

Plaintiffs-Appellees,

v.

ALLSTATE INSURANCE COMPANY,

Defendant-Appellant.

No. 13-16816

D.C. No.

4:13-cv-00685-

PJH

OPINION

Appeal from the United States District Court

for the Northern District of California

Phyllis J. Hamilton, Chief District Judge, Presiding

Argued and Submitted

March 22, 2016—San Francisco, California

Filed April 12, 2016

Before: Barry G. Silverman, Raymond C. Fisher

and Richard C. Tallman, Circuit Judges.

Opinion by Judge Fisher

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2 CHEN V. ALLSTATE INS. CO.

SUMMARY*

Mootness / Offers of Judgment

The panel affirmed the district court’s denial of a motion

to dismiss a putative class action under the Telephone

Consumer Protection Act as moot following defendant’s

unaccepted offer of judgment on a plaintiff’s individual

claims under Federal Rule of Civil Procedure 68.

The panel held that the case was not moot because first,

even if the district court entered judgment affording the

plaintiff complete relief on his individual claims for damages

and injunctive relief, mooting those claims, he would still be

able to seek class certification under Pitts v. Terrible Herbst,

Inc., 653 F.3d 1081 (9th Cir. 2011), which remains good law

pursuant to Gomez v. Campbell-Ewald Co., 768 F.3d 871 (9th

Cir. 2014), aff’d, 136 S. Ct. 663 (2016). Second, even if Pitts

were not binding, and the defendant could moot the entire

action by mooting the plaintiff’s individual claims, the

individual claims were not yet moot because the plaintiff had

not yet actually received relief. The panel held that it would

not direct the district court to enter judgment, over the

plaintiff’s objections, on his individual claims when he had

not yet had a fair opportunity to move for class certification.

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

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CHEN V. ALLSTATE INS. CO. 3

COUNSEL

Mark J. Levin (argued), Ballard Spahr LLP, Philadelphia,

Pennsylvania; Daniel M. Benjamin, Ballard Spahr LLP, San

Diego, California; and Scott M. Pearson, Ballard Spahr LLP,

Los Angeles, California, for Defendant-Appellant.

F. Paul Bland, Jr. (argued) and Claire Prestel, Public Justice,

P.C., Washington, D.C.; Abbas Kazerounian, Kazerouni Law

Group, APC, Costa Mesa, California; Joshua B. Swigart,

Hyde & Swigart, San Diego, California; Todd M. Friedman,

Law Offices of Todd Friedman, P.C., Beverly Hills,

California; and Spencer J. Wilson, Public Justice, P.C.,

Oakland, California, for Plaintiffs-Appellees.

Kate Comerford Todd and Tyler R. Green, Chamber of

Commerce of the U.S., Washington, D.C.; Eric J. Ellman,

Consumer Data Industry Association, Washington, D.C.;

Theodore J. Boutrous Jr., Gibson, Dunn & Crutcher LLP, Los

Angeles, California; Robert E. Dunn, Gibson, Dunn &

Crutcher LLP, Palo Alto, California; and Gregory G. Garre,

Latham &Watkins LLP, Washington, D.C., for Amici Curiae

Chamber of Commerce of the United States and Consumer

Data Industry Association.

Timothy Sandefur and Anastasia P. Boden, Pacific Legal

Foundation, Sacramento, California, for Amicus Curiae

Pacific Legal Foundation.

James M. Nelson, Greenberg Traurig, LLP, Sacramento,

California; James N. Boudreau, Greenberg Traurig, LLP,

Philadelphia, Pennsylvania; Thomas S. Knox, Knox Lemmon

& Anapolsky, LLP, Sacramento, California; and John F.

Farraher, Jr., Greenberg Traurig, LLP, Boston,

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4 CHEN V. ALLSTATE INS. CO.

Massachusetts, for Amicus Curiae California Retailers

Association.

James C. Sturdevant, The Sturdevant Law Firm, San

Francisco, California, for Amicus Curiae National

Association of Consumer Advocates.

Scott L. Nelson, Allison M. Zieve, and Adina H. Rosenbaum,

Public Citizen Litigation Group, Washington, D.C., for

Amicus Curiae Public Citizen, Inc.

OPINION

FISHER, Circuit Judge:

Florencio Pacleb filed a class action complaint against

Allstate Insurance Company, alleging he received unsolicited

automated telephone calls to his cellular telephone, in

violation of the Telephone Consumer Protection Act. Taking

a cue from a recent Supreme Court case, Campbell-Ewald

Co. v. Gomez, 136 S. Ct. 663 (2016) (“Campbell-Ewald”), on

appeal Allstate deposited $20,000 in full settlement of

Pacleb’s individual monetary claims in an escrow account

“pending entry of a final District Court order or judgment

directing the escrow agent to pay the tendered funds to

Pacleb, requiring Allstate to stop sending non-emergency

telephone calls and short message service messages to Pacleb

in the future and dismissing this action as moot.” On the

basis of these actions, Allstate argues we should “reverse the

denial of Allstate’s motion to dismiss for lack of subject

matter jurisdiction and remand to the District Court to order

disbursement of the tendered funds to Pacleb, the entry of

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CHEN V. ALLSTATE INS. CO. 5

judgment in favor of Pacleb and the dismissal of this action

as moot.” We disagree.

First, even if the district court entered judgment affording

Pacleb complete relief on his individual claims for damages

and injunctive relief, mooting those claims, Pacleb would still

be able to seek class certification under Pitts v. Terrible

Herbst, Inc., 653 F.3d 1081 (9th Cir. 2011). Although

Allstate argues Pitts is no longer good law after Genesis

Healthcare Corp. v. Symczyk, 133 S. Ct. 1523 (2013), we

rejected that very argument in Gomez v. Campbell-Ewald

Co., 768 F.3d 871 (9th Cir. 2014) (“Gomez”), aff’d, 136 S. Ct.

663 (2016). Pitts therefore remains the law of this circuit.1

Second, even if Pitts were not binding, and Allstate could

moot the entire action by mooting Pacleb’s individual claims

for damages and injunctive relief, those individual claims are

not now moot, and we will not direct the district court to

moot them by entering judgment on them before Pacleb has

had a fair opportunity to move for class certification. Under

Supreme Court and Ninth Circuit case law, a claim becomes

moot when a plaintiff actually receives complete relief on

that claim, not merely when that relief is offered or tendered. 

Where, as here, injunctive relief has been offered, and funds

have been deposited in an escrow account, relief has been

offered, but it has not been received. Pacleb’s individual

claims, therefore, are not now moot. Nor will we direct the

district court to moot them. Assuming arguendo a district

court could enter a judgment according complete relief on a

plaintiff’s individual claims over the plaintiff’s objections,

1

In Campbell-Ewald, 136 S. Ct. 663, the Supreme Court affirmed

Gomez, but did not address the continuing validity of Pitts. Gomez’s

holding on this issue, therefore, remains binding in this circuit.

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6 CHEN V. ALLSTATE INS. CO.

thereby mooting those claims, such action is not appropriate

here. As the Supreme Court said in Campbell-Ewald, 136 S.

Ct. at 672, “[w]hile a class lacks independent status until

certified, see Sosna v. Iowa, 419 U.S. 393, 399 (1975), a

would-be class representative with a live claim of her own

must be accorded a fair opportunity to show that certification

is warranted.” Because Pacleb has not yet had a fair

opportunity to move for class certification, we will not direct

the district court to enter judgment, over Pacleb’s objections,

on his individual claims.

For the above reasons, we affirm the order denying

Allstate’s motion to dismiss for lack of subject matter

jurisdiction.

BACKGROUND

In 2013, Richard Chen and Florencio Pacleb filed a class

action complaint against Allstate Insurance Company,

asserting violations of the Telephone Consumer Protection

Act (TCPA). The TCPA makes it unlawful, in part, “to make

any call (other than a call made for emergency purposes or

made with the prior express consent of the called party) using

any automatic telephone dialing system or an artificial or

prerecorded voice . . . to any telephone number assigned to a

. . . cellular telephone service, . . . unless such call is made

solely to collect a debt owed to or guaranteed by the United

States.” 47 U.S.C. § 227(b)(1)(A). An aggrieved person may

bring an action to enjoin a violation of this provision or to

seek actual or statutory damages. See id. § 227(b)(3). 

Statutory damages are $500 per violation. See id.

§ 227(b)(3)(B). If a violation is willful or knowing, a court

may treble the award. See id. § 227(b)(3).

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CHEN V. ALLSTATE INS. CO. 7

Chen alleged he received eight calls from Allstate in

violation of § 227(b)(1)(A). Pacleb alleged he received five

such calls. In Pacleb’s case, the automated calls asked for an

individual named Frank Arnold. Chen and Pacleb brought

their claims “on behalf of themselves and all others similarly

situated,” as members of a proposed class defined as:

All persons within the United States who

received any telephone calls from Defendant

to said person’s cellular telephone made

through the use of any automatic telephone

dialing system and such person had not

previously consented to receiving such calls

within the four years prior to the filing of this

Complaint.

In their first cause of action, for negligent violations of the

TCPA, Chen and Pacleb sought for themselves and the

members of the proposed class $500 in statutory damages for

each violation and injunctive relief prohibiting such conduct

in the future. In their second cause of action, for knowing or

willful violations of the TCPA, theysought $1500 in statutory

damages for each violation and similar injunctive relief. The

plaintiffs subsequently abandoned their claims for knowing

or willful violations of the TCPA.

In April 2013, before any motion for class certification

had been made, Allstate made an offer of judgment to Chen

and Pacleb under Rule 68 of the Federal Rules of Civil

Procedure. Allstate offered to allow judgment to be taken

against it by Chen and Pacleb “on their individual claims in

the amount of $15,000.00 and $10,000.00, respectively,

together with reasonable attorneys’ fees and costs that have

been accrued to date.” With respect to Chen and Pacleb’s

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8 CHEN V. ALLSTATE INS. CO.

demand for injunctive relief, Allstate agreed “to stop sending

non-emergency telephone calls and short message service

messages to [them] in the future.” The offer was made

“solely for the purposes specified in Rule 68” and provided

Chen and Pacleb 14 days to accept the offer in writing. The

offer also directed Chen’s and Pacleb’s “attention to the

provision of Rule 68 that provides that ‘[i]f the judgment

finally obtain[ed] [by Plaintiffs] is not more favorable than

[Allstate’s] offer, the [Plaintiffs] must pay the costs incurred

after the offer was made’” (alterations in original) (quoting

Fed. R. Civ. P. 68(d)).

When Chen and Pacleb did not accept the offer within 14

days, Allstate sent plaintiffs’ counsel a letter purporting to

extend the “offer of judgment until such time as it is accepted

by plaintiffs or Allstate withdraws the offer in writing” and,

the next day, moved to dismiss the complaint for lack of

subject matter jurisdiction. Allstate argued “Plaintiffs’ claims

are moot because Allstate (without admitting liability) made

an offer of judgment under Fed. R. Civ. P. 68 in an amount

that is more than sufficient to satisfy all of Plaintiffs’ alleged

individual damages and non-monetary requests for relief.” In

Allstate’s view, “[o]nce the defendant offers to satisfy the

plaintiff’s entire demand, there is no dispute to litigate, and a

plaintiff who refuses to acknowledge this loses outright,

under Fed. R. Civ. P. 12(b)(1), because he has no remaining

stake.” The plaintiffs’ class claims “should also be dismissed

as moot” because “no class certification motion has been

filed.” Allstate urged the court to enter judgment of dismissal

“in its favor and against Plaintiffs with prejudice.” While the

motion to dismiss was pending, Chen accepted Allstate’s

Rule 68 offer. Pacleb did not.

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CHEN V. ALLSTATE INS. CO. 9

The district court denied Allstate’s motion to dismiss. 

The court did not squarely address whether Allstate’s Rule 68

offer provided complete relief on Pacleb’s individual claims

for damages and injunctive relief. Nor did the court

determine whether such an offer, if unaccepted, would moot

Pacleb’s individual claims. Instead, the court relied on this

court’s decision in Pitts v. Terrible Herbst, Inc., 653 F.3d

1081 (9th Cir. 2011), to hold that, even if Pacleb’s individual

claims could be considered fully satisfied by the offer, the

action as a whole continued to present a justiciable

controversyaffording Pacleb an opportunity to move for class

certification. In doing so, the court rejected Allstate’s

argument that Pitts was no longer good law in light of the

Supreme Court’s intervening decision in Genesis Healthcare. 

The district court subsequently granted Allstate’s motion to

certify the order for interlocutory appeal under 28 U.S.C.

§ 1292(b), stating the court “would welcome the Ninth

Circuit’s view as to whether its Pitts decision remains good

law in light of Genesis Healthcare.” We granted permission

to appeal. While the appeal was pending, we decided Gomez,

768 F.3d at 875–76, holding Pitts remains the law of this

circuit after Genesis Healthcare.

Also while this appeal was pending, the Supreme Court

decided Campbell-Ewald. Campbell-Ewald confirmed that

“an unaccepted settlement offer has no force.” 136 S. Ct. at

666. “Like other unaccepted contract offers, it creates no

lasting right or obligation.” Id. “With the offer off the table,

and the defendant’s continuing denial of liability, adversity

between the parties persists.” Id.2 Thus, an unaccepted offer

2

In its initial briefing in this court, Allstate attempted to distinguish this

case from Diaz v. First American Home Buyers Protection Corp.,

732 F.3d 948 (9th Cir. 2013) (holding an unaccepted Rule 68 offer does

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10 CHEN V. ALLSTATE INS. CO.

to satisfy the named plaintiff’s individual claim is insufficient

“to render a case moot when the complaint seeks relief on

behalf of the plaintiff and a class of persons similarly

situated.” Id. The Court also declined to “decide whether the

result would be different 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.” Id. at 672. The Court expressly

reserved this question “for a case in which it is not

hypothetical.” Id.

Allstate seeks to take up that hypothetical here. Shortly

after the Supreme Court issued Campbell-Ewald, Allstate

deposited $20,000 in a bank escrow account “pending entry

of a final District Court order or judgment directing the

escrow agent to pay the tendered funds to Pacleb, requiring

Allstate to stop sending non-emergency telephone calls and

short message service messages to Pacleb in the future and

dismissing this action as moot.”3 Allstate argues this action

not moot a claim), on the ground that Diaz involved an expired offer of

judgment, whereas Allstate purported to hold its Rule 68 offer open. 

Following the Supreme Court’s decision in Campbell-Ewald, however,

Allstate has not continued to press that argument, and properly so. Under

Campbell-Ewald, the key question is whether an offer has been accepted,

regardless of whether it has lapsed or remains on the table. See CampbellEwald, 136 S. Ct. at 666 (“We hold today, in accord with Rule 68 of the

Federal Rules of Civil Procedure, that an unaccepted settlement offer has

no force.” (emphasis added)); id. at 672 (holding “an unaccepted

settlement offer or offer of judgment does not moot a plaintiff’s case”

(emphasis added)).

3 We grant Allstate’s motion to supplement the record on appeal to

include the escrow documents. See Johnson v. Rancho Santiago Cmty.

Coll. Dist., 623 F.3d 1011, 1020 n.3 (9th Cir. 2010) (“Because the new

facts that the defendants seek to establish bear on whether the controversy

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CHEN V. ALLSTATE INS. CO. 11

on the part of the district court would moot Pacleb’s

individual claims. It further contends that, because Pitts no

longer remains good law, the existence of Pacleb’s class

claims do not preserve a justiciable controversy. 

Accordingly, Allstate urges us to “reverse the denial of

Allstate’s motion to dismiss for lack of subject matter

jurisdiction and remand to the District Court to order

disbursement of the tendered funds to Pacleb, the entry of

judgment in favor of Pacleb and the dismissal of this action

as moot.”

STANDARD OF REVIEW

We review de novo the denial of a motion to dismiss for

lack of subject matter jurisdiction. See Botosan v. Paul

McNally Realty, 216 F.3d 827, 830 (9th Cir. 2000).

DISCUSSION

Allstate’s theory of mootness turns on three contentions:

(1) that the judgment it has consented to would afford Pacleb

complete relief on his individual claims for damages and

injunctive relief; (2) that the district court should be required

to enter judgment on these terms, and that, once the court

does so, Pacleb’s individual claims will become moot; and

(3) assuming Pacleb’s individual claims become moot, the

existence of his class allegations will be insufficient to

preserve a live controversy. As explained below, we agree

with Allstate’s first contention, but reject its second and third

arguments.

before us is moot, we exercise our discretion to supplement the record on

appeal so that we may determine whether we have jurisdiction . . . .”).

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12 CHEN V. ALLSTATE INS. CO.

A. Complete Relief

Pacleb argues the judgment Allstate has consented to

would not afford him complete relief on his individual claims

for damages and injunctive relief, because Allstate has neither

admitted liability nor offered sufficiently broad injunctive

relief. We disagree.

1. Admission of Liability

Pacleb contends Allstate has not agreed to complete relief

because the judgment it has consented to would not include

an admission of liability. Because his complaint alleges

Allstate violated the TCPA, he maintains he “has an interest

in a finding of liability by a court, or an admission of liability

from Allstate, on those legal allegations.”

Pacleb, however, has not explained why, under the

circumstances of this case, an admission of liability is

necessary to afford him complete relief on his non-class

claims. Pacleb’s complaint sought only statutory damages

and injunctive relief, not an admission of liability or a

declaration that Allstate violated his rights. When a plaintiff

has received “all the relief [he] could win on the merits,” an

adjudication would have no “consequences on remaining

related disputes between the parties” and “nothing further

would be ordered by the court, there is no point in proceeding

to decide the merits.” 13B Charles Alan Wright & Arthur R.

Miller, Federal Practice and Procedure § 3533.2 (3d ed.

2015). See Already, LLC v. Nike, Inc., 133 S. Ct. 721,

726–33 (2013) (holding a covenant not to sue mooted a

counterclaim of trademark invalidity, notwithstanding the

lack of an admission or finding of liability); McCauley v.

Trans Union, LLC, 402 F.3d 340, 342 (2d Cir. 2005) (holding

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CHEN V. ALLSTATE INS. CO. 13

a plaintiff “is not entitled to keep litigating his claim simply

because [the defendant] has not admitted liability”).

2. Scope of Injunctive Relief

Pacleb alternatively contends Allstate has not agreed to

complete relief on his individual claims because the judgment

to which it has consented would not provide the full scope of

injunctive relief he seeks in his complaint. He argues,

“[g]iven the fact that [he] received calls from Allstate looking

for a ‘Mr. Arnold,’ errors in Allstate’s phone records leave

reason to doubt that a narrow injunction merely requiring

Allstate to refrain from calling [him] would be effective.” 

According to Pacleb, only a nationwide injunction enjoining

Allstate from all violations of § 227(b)(1)(A) will afford him

effective relief.

Pacleb is correct that he is not necessarily precluded from

obtaining nationwide injunctive relief:

While injunctive relief generally should be

limited to apply only to named plaintiffs

where there is no class certification, “an

injunction is not necessarily made overbroad

by extending benefit or protection to persons

other than prevailing parties in the lawsuit –

even if it is not a class action – if such breadth

is necessary to give prevailing parties the

relief to which they are entitled.”

Easyriders Freedom F.I.G.H.T. v. Hannigan, 92 F.3d 1486,

1501–02 (9th Cir. 1996) (citation omitted) (quoting Bresgal

v. Brock, 843 F.2d 1163, 1170–71 (9th Cir. 1987)). Here,

however, Pacleb has given us no reason to believe the

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14 CHEN V. ALLSTATE INS. CO.

injunctive relief to which Allstate has consented would be

inadequate, or that he could obtain broader relief after a trial

on the merits. Allstate, therefore, has consented to all the

injunctive relief to which Pacleb individually is entitled.

B. Continuing Validity of Pitts

In Allstate’s view, if it is able to fully satisfy Pacleb’s

individual claims, the action as a whole will also be moot. 

We disagree. Even if, as Allstate proposes, the district court

were to enter judgment providing complete relief on Pacleb’s

individual claims for damages and injunctive relief before

class certification, fully satisfying those individual claims,

Pacleb still would be entitled to seek certification. In Pitts,

653 F.3d at 1091, we observed that a named plaintiff’s claim

is “transitory in nature and may otherwise evade review” in

light of a defendant’s tactic of “picking off” lead plaintiffs to

avoid a class action. As a leading treatise explains, “[t]o the

extent that defendants may avoid a class action by ‘picking

off’ the named plaintiffs, the class claims are ‘inherently

transitory’ and evade review, making an exception to the

mootness rule appropriate.” 5 James Wm. Moore, Moore’s

Federal Practice § 23.64[1][b] (3d ed. 2016). Accordingly,

we held

an unaccepted Rule 68 offer of judgment – for

the full amount of the named plaintiff’s

individual claim and made before the named

plaintiff files a motion for class certification –

does not moot a class action. If the named

plaintiff can still file a timely motion for class

certification, the named plaintiff maycontinue

to represent the class until the district court

decides the class certification issue. Then, if

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CHEN V. ALLSTATE INS. CO. 15

the district court certifies the class,

certification relates back to the filing of the

complaint. Once the class has been certified,

the case may continue despite full satisfaction

of the named plaintiff’s individual claim

because an offer of judgment to the named

plaintiff fails to satisfy the demands of the

class. See Sosna, 419 U.S. at 402–03. 

Conversely, if the district court denies class

certification, under [Deposit Guaranty

National Bank v. Roper, 445 U.S. 326

(1980),] and [U.S. Parole Commission v.

Geraghty, 445 U.S. 388 (1980)], the plaintiff

may still pursue a limited appeal of the class

certification issue. Only once the denial of

class certification is final does the defendant’s

offer – if still available – moot the merits of

the case because the plaintiff has been offered

all that he can possibly recover through

litigation.

Pitts, 653 F.3d at 1091–92 (footnote omitted).4

Allstate argues Pitts is no longer good law in light of the

Supreme Court’s intervening decision in Genesis Healthcare,

which questioned the application of “the ‘inherently

transitory’ relation-back rationale” to circumstances in which

the transitory nature of the claim arises from “the defendant’s

4 Pitts assumed without deciding that a mere offer of complete relief on

a named plaintiff’s individual claim was sufficient to moot that claim. 

Subsequent decisions make clear this is not the case. See CampbellEwald, 136 S. Ct. at 666; Gomez, 768 F.3d at 874–75; Diaz, 732 F.3d at

954–44.

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16 CHEN V. ALLSTATE INS. CO.

litigation strategy” rather than “the fleeting nature of the

challenged conduct giving rise to the claim.” 133 S. Ct. at

1531. In Gomez, 768 F.3d at 875–76, however, we squarely

rejected that very argument. Because Genesis Healthcare

concerned collective actions brought under the Fair Labor

Standards Act (FLSA) rather than class actions under Federal

Rule of Civil Procedure 23, Gomez held Pitts was not clearly

irreconcilable with Genesis Healthcare. See id. Although

Genesis Healthcare “undermined some of the reasoning

employed in Pitts . . . , courts have universally concluded that

the Genesis discussion does not apply to class actions.” Id.

at 875. “In fact, Genesis itself emphasizes that ‘Rule 23

[class] actions are fundamentally different from collective

actions under the FLSA.’” Id. at 875–76 (alteration in

original) (quoting Genesis Healthcare, 133 S. Ct. at 1529).

Because Gomez’s holding that Pitts is not clearly

irreconcilable with Genesis Healthcare is not itself clearly

irreconcilable with intervening Supreme Court authority, we

are bound by Gomez. See Miller v. Gammie, 335 F.3d 889,

892–93 (9th Cir. 2003) (en banc) (holding “a three-judge

panel may [not] reexamine normally controlling circuit

precedent in the face of an intervening United States Supreme

Court decision” unless “the reasoning or theory of our prior

circuit authority is clearly irreconcilable with the reasoning or

theory of intervening higher authority”). Accordingly, Pitts

remains the law of this circuit. Under Pitts, even assuming

Allstate could fully satisfy Pacleb’s individual claims, Pacleb

still would be able to seek class certification.

C. Effect of Allstate’s Actions

Furthermore, even if Pitts were not controlling, we would

reject Allstate’s attempt to moot this action before Pacleb has

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CHEN V. ALLSTATE INS. CO. 17

had a fair opportunity to seek certification. That is, even if

Allstate could moot the entire action by getting the district

court to enter judgment in favor of Pacleb on his individual

claims before he has had a fair opportunity to move for

certification, we would decline Allstate’s invitation to direct

the district court to take that action.

As noted, Allstate recently deposited $20,000 in escrow

and proposed entry of judgment favorable to Pacleb on his

individual claims for damages and injunctive relief. Allstate

contends its actions invoke the hypothetical question reserved

in Campbell-Ewald – whether a case becomes moot when “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.” 

136 S. Ct. at 672. Allstate argues we must direct the district

court to enter judgment and dismiss both Pacleb’s individual

claims and the action as a whole as moot.

1. Allstate’s Actions to Date Do Not Afford Pacleb

Any Actual Relief and Thus Do Not Moot His

Individual Claims for Damages and Injunctive

Relief

As an initial matter, Allstate does not dispute that its

actions to date – depositing $20,000 in escrow on Pacleb’s

individual damages claim and agreeing to an injunction on his

individual injunctive relief claim – do not afford Pacleb any

actual relief, and thus do not moot his individual claims for

damages and injunctive relief.

As 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

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18 CHEN V. ALLSTATE INS. CO.

further litigation. Campbell-Ewald cited a trio of railroad

cases that reenforce this view. In San Mateo County v.

Southern Pacific Railroad Co., 116 U.S. 138, 141 (1885), the

county sued the railroad for unpaid taxes and the railroad paid

the county a sum exceeding the taxes, penalties, attorney’s

fees and interest sought in the lawsuit. Noting the “debt for

which the suit was brought has been unconditionally paid and

satisfied,” the Supreme Court dismissed the appeal, holding

“there is no longer an existing cause of action in favor of the

county against the railroad company.” Id. at 141–42. In

Little v. Bowers, 134 U.S. 547 (1890), the taxes in dispute

again were fully paid while the appeal was pending. Relying

on San Mateo County, the Court dismissed the appeal due to

the absence of an “actual controversy, involving real and

substantial rights, between the parties.” Id. at 556–58. In

California v. San Pablo &Tulare Railroad Co., 149 U.S. 308

(1893), California sued the railroad to recover taxes. The

railroad tendered to the state a sum of money equal to the

taxes, penalties, interest and attorney’s fees at issue in the

litigation. See id. at 311–12. Although the state did not

accept the tender, the railroad deposited the funds in a bank

in accordance with a state law making such a deposit

equivalent to actual payment. See id. at 312.5 The Supreme

Court dismissed the appeal:

[T]here can be no doubt that this writ of error

must be dismissed, because the cause of

5 Under the statute, “[a]n obligation for the payment of money is

extinguished by a due offer of payment, if the amount is immediately

deposited in the name of the creditor, with some bank of deposit within

this State of good repute, and notice thereof is given to the creditor.” San

Pablo, 149 U.S. at 312 (quotingCal. Civ. Code § 1500) (internal quotation

marks omitted).

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CHEN V. ALLSTATE INS. CO. 19

action has ceased to exist. Any obligation of

the defendant to pay to the State the sums

sued for in this case, together with interest,

penalties and costs, has been extinguished by

the offer to pay all these sums, and the deposit

of the money in a bank, which by a statute of

the State have the same effect as actual

payment and receipt of the money. And the

State has obtained everything that it could

recover in this case by a judgment of this

court in its favor.

Id. at 313–14.

Our own decisions are consistent with this view: a claim

becomes moot once the plaintiff actually receives all of the

relief to which he or she is entitled on the claim. See, e.g.,

Back v. Sebelius, 684 F.3d 929, 933 (9th Cir. 2012) (“Because

the Secretary has already created the administrative appeals

process that Back seeks, ‘no present controversy exists as to

which [we] can grant effective relief.’” (alteration in original)

(quotingVegas Diamond Props., LLC v. FDIC, 669 F.3d 933,

936 (9th Cir. 2012)).6

6

See also S. Cal. Painters & Allied Trades, Dist. Council No. 36 v.

Rodin & Co., 558 F.3d 1028, 1035–36 (9th Cir. 2009) (a claim for

damages was moot where the back union dues sought in the action had

been fully paid); Ruvalcaba v. City of Los Angeles, 167 F.3d 514, 520–21

(9th Cir. 1999) (where claims against a police officer had been fully

satisfied, the plaintiff’s claims regarding whether the officer’s actions

were unconstitutional were moot); Sohappy v. Hodel, 911 F.2d 1312, 1321

(9th Cir. 1990) (a claim the government had broken agreements to replace

fishing lands destroyed by a dam was mooted by the acquisition of

replacement lands “satisfying the plaintiffs’ demands”); Carter v.

Veterans Admin., 780 F.2d 1479, 1481 (9th Cir. 1986) (where plaintiff’s

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20 CHEN V. ALLSTATE INS. CO.

Under this line of cases, Pacleb’s individual claims for

damages and injunctive relief are not now moot. “A case

becomes moot only when it is impossible for a court to grant

‘any effectual relief whatever to the prevailing party.’” Knox

v. Serv. Emps. Int’l Union, Local 1000, 132 S. Ct. 2277, 2287

(2012) (quoting Erie v. Pap’s A.M., 529 U.S. 277, 287

(2000)). Here, Pacleb has not yet received any relief on his

individual claims for damages or injunctive relief. His claims

are wholly unsatisfied, and it remains entirely possible for a

court to grant him effectual relief. See Campbell-Ewald,

136 S. Ct. at 672. At this moment, therefore, Allstate’s

actions plainly have not mooted Pacleb’s individual claims.

Under the common law doctrine of tender, there mayhave

been occasions when the deposit of money in court could be

“treated as the equivalent of an actual payment to and

acceptance by the plaintiff.” Robert G. Bone, “To Encourage

Settlement”: Rule 68, Offers of Judgment, and the History of

the Federal Rules of Civil Procedure, 102 Nw. U.L. Rev.

1561, 1585 (2008). At most, however, that principle applied

when the defendant unconditionally relinquished its entire

interest in the deposited funds. See id. at 1586 (“The money

became the plaintiff’s property as soon as it was deposited

and remained the plaintiff’s property even if the defendant

won at trial. As one commentator put it, ‘the defendant bids

his money an eternal farewell.’” (quoting H. Gerald Chapin,

Code Practice in New York 164 (1918))). That has not

occurred here. Allstate has neither deposited the $20,000 in

the court nor unconditionally relinquished its interest in the

complaint sought injunctive relief directing a government agency to

provide documents he requested under the Freedom of Information Act,

the claim was mooted when the agency voluntarily mailed copies of the

documents to the plaintiff).

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CHEN V. ALLSTATE INS. CO. 21

$20,000 to Pacleb. On the contrary, Allstate retains its

interest in the funds unless and until the district court

dismisses this entire action as moot. See Def.-Appellant

Allstate Ins. Co.’s Mot. Suppl. Appellate R. 4-5, ECF No. 80

(“The tendered funds have been deposited in an escrow

account at The Bank of New York Mellon (the ‘Bank’)

pending entry of a final District Court order or judgment

directing the escrow agent to pay the tendered funds to

Pacleb, requiring Allstate to stop sending non-emergency

telephone calls and short message service messages to Pacleb

in the future and dismissing this action as moot. If, and only

if, the District Court or any final appellate court declines to

issue such an order dismissing this action as moot, Allstate

will move the District Court to order the escrowed funds to be

returned to Allstate.”). Thus, even assuming this aspect of

common law tender would apply here, Pacleb has not actually

or constructively received the $20,000. Nor has he received

relief on his individual injunctive relief claim.7

In sum, Pacleb’s individual claims are not now moot,

because he has not actually received all of the relief to which

he is entitled on those claims.

7 Like Rule 68, common law tender exists principally as a means of

limiting damages or costs rather thanmooting claims. See Tender, Black’s

Law Dictionary (10th ed. 2014) (defining “tender” as “an unconditional

offer of money or performance to satisfy a debt or obligation” and

“judicial tender” as “[a] tender with actual delivery of money to a party

while in court. The object is to avoid further expense. If the pursuer is

awarded no higher sum than that tendered, the pursuer is then found liable

for the defender’s expenses from the date of the tender.”); Alva R. Hunt,

A Treatise on the Law of Tender, and Bringing Money Into Court § 5

(1903) (“[W]here the debtor or obligor has but to pay the money or

performthe duty to discharge himself ofthe obligation, in order to stop the

running of interest, or prevent the accruing of damages, or to save a

forfeiture, or a penalty, an actual tender is necessary.” (footnote omitted)).

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22 CHEN V. ALLSTATE INS. CO.

2. Allstate’s Suggestion That We Should Direct the

District Court to Enter Judgment on Pacleb’s

Individual Claims, as an Attempt to Moot the

Action, Is Contrary to Campbell-Ewald, Which

Affords a Would-be Class Representative with a

Live Claim a Fair Opportunity to Show

Certification Is Warranted

The question remains whether we should, as Allstate

urges, instruct the district court to order monetary and

injunctive relief on Pacleb’s individual claims, thereby

mooting them, before Pacleb has had an opportunity to move

for class certification. We assume, without deciding, a court

has authority in an appropriate case to enter judgment for

complete relief on a plaintiff’s individual claims over the

plaintiff’s objection. Cf. Diaz, 732 F.3d at 955 (recognizing

a court may have discretion to halt a lawsuit – or, as relevant

here, particular claims – byentering judgment for the plaintiff

when the defendant “unconditionally surrenders and only the

plaintiff’s obstinacy or madness prevents her from accepting

total victory” (quoting Genesis Healthcare, 133 S. Ct. at

1536) (Kagan, J., dissenting)) (internal quotation marks

omitted)).

Even if that is true, however, Campbell-Ewald clearly

suggests it would be inappropriate to enter judgment under

these circumstances. AsCampbell-Ewald explained, “[w]hile

a class lacks independent status until certified, a would-be

class representative with a live claim of her own must be

accorded a fair opportunity to show that certification is

warranted.” Campbell-Ewald, 136 S. Ct. at 672 (emphasis

added) (citation omitted) (citing Sosna, 419 U.S. at 399). 

Accordingly, when a defendant consents to judgment

affording complete relief on a named plaintiff’s individual

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CHEN V. ALLSTATE INS. CO. 23

claims before certification, but fails to offer complete relief

on the plaintiff’s class claims, a court should not enter

judgment on the individual claims, over the plaintiff’s

objection, before the plaintiff has had a fair opportunity to

move for class certification.

This conclusion is consistent not only with CampbellEwald but also with previous Supreme Court decisions noting

a named plaintiff’s “‘personal stake’ in obtaining class

certification,” Geraghty, 445 U.S. at 404, recognizing

“[s]ome claims are so inherently transitory that the trial court

will not have even enough time to rule on a motion for class

certification before the proposed representative’s individual

interest expires,” id. at 399, and disapproving of the “picking

off” of named plaintiffs to deny a would-be class

representative a fair opportunity to seek class relief, see

Roper, 445 U.S. at 339. As the Court said in Roper, 445 U.S.

at 339, “[r]equiring multiple plaintiffs to bring separate

actions, which effectively could be ‘picked off’ by a

defendant’s tender of judgment before an affirmative ruling

on class certification could be obtained, obviously would

frustrate the objectives of class actions.” But cf. Genesis

Healthcare, 133 S. Ct. at 1529–32 (applying these authorities

narrowly in the FLSA collective action context).

Contrary to Allstate’s argument, our conclusion is also

consistent with the proposition that “a court may have

‘discretion to halt a lawsuit by entering judgment for the

plaintiff when the defendant unconditionally surrenders and

only the plaintiff’s obstinacy or madness prevents her from

accepting total victory.’” Diaz, 732 F.3d at 955 (quoting

Genesis Healthcare, 133 S. Ct. at 1536 (Kagan, J.,

dissenting)). A named plaintiff exhibits neither obstinacy nor

madness by declining an offer of judgment on individual

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24 CHEN V. ALLSTATE INS. CO.

claims in order to pursue relief on behalf of members of a

class. As the Supreme Court has recognized, the class action

device is often the only effective means of pursuing relief on

behalf of injured persons. “Where it is not economically

feasible to obtain relief within the traditional framework of a

multiplicity of small individual suits for damages, aggrieved

persons may be without any effective redress unless theymay

employ the class-action device.” Roper, 445 U.S. at 339. A

named plaintiff acts sensibly by pursuing all of the relief

sought in the complaint, and “a judgment satisfying an

individual claim does not give a [named] plaintiff . . . ,

exercising her right to sue on behalf of other employees, ‘all

that [she] has . . . requested in the complaint (i.e., relief for

the class).’” Genesis Healthcare, 133 S. Ct. at 1536 (Kagan,

J., dissenting) (third and fourth alterations in original)

(quoting Roper, 445 U.S. at 341 (Rehnquist, J., concurring)).

Our approach is also consistent with leading treatises on

federal procedure. According to Wright & Miller, “[i]f the

defendant is willing to consent to judgment on terms that

embrace all the relief the plaintiff could win on the merits, the

action may be found moot.” 13B Charles Alan Wright &

Arthur R. Miller, Federal Practice and Procedure § 3533.2

(3d ed. 2015). But “offers to provide full relief to the

representative plaintiffs who wish to pursue a class action

must be treated specially, lest defendants find an easy way to

defeat class relief.” Id.; accord 13C id. § 3533.9.1. 

“[A]pplying both the flexibility of Article III’s requirements

and the need to protect the interests of class members prior to

certification, Article III mootness should not provide a

vehicle for ‘picking off’ named plaintiffs or eliminating class

treatment of claims until there has been a reasonable

opportunity to present the issue of class certification to the

court.” 5 Moore’s Federal Practice, supra, § 23.64[1][b]. 

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CHEN V. ALLSTATE INS. CO. 25

“[W]hen a named plaintiff has requested class certification

and class relief in its complaint, but has not yet had a

reasonable opportunity to file a motion seeking class

certification, an offer of individual relief should not be

considered to be a tender of all relief requested in the

complaint.” Id.

Finally, our conclusion is consistent with district court

decisions issued since Campbell-Ewald was decided. See

Bais Yaakov of Spring Valley v. Graduation Source, LLC, ___

F. Supp. 3d. ____, No. 14-cv-3232 (NSR), 2016 WL 872914,

at *1 (S.D.N.Y. Mar. 7, 2016) (“Although Defendants sought

to avail themselves of the hypothetical proposed in CampbellEwald by depositing the full amount of statutory damages

into the Court’s Finance Unit and assenting to the injunctive

relief requested by Plaintiff in its Complaint, . . . this Court is

bound by Campbell-Ewald to afford Plaintiff a fair

opportunity to show that class certification is warranted. . . . 

[If] after discovery Plaintiff fails to certify a class,

Defendants may renew their request to issue judgment in

favor of Plaintiff based upon a complete offer of relief.”);

Brady v. Basic Research, LLC, 312 F.R.D. 304, 306

(E.D.N.Y. 2016) (precluding a defendant from using Federal

Rule of Civil Procedure 67 to moot a case before a plaintiff

has had a fair opportunity to pursue class certification).8 We

approve of these decisions, which adhere to the requirements

 

8

See Fed. R. Civ. P. 67(a) (“If any part of the relief sought is a money

judgment or the disposition of a sum of money or some other deliverable

thing, a party – on notice to every other party and by leave of court – may

deposit with the court all or part of the money or thing, whether or not that

party claims any of it. The depositing party must deliver to the clerk a

copy of the order permitting deposit.”). For a brief history of Rule 67, see

John Quincey Somerville, Fed. R. Civ. P. 67: Is It More Than Meets the

Eye?, 42 Ala. L. Rev. 215 (1990).

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26 CHEN V. ALLSTATE INS. CO.

of Article III without depriving a named plaintiff of

Campbell-Ewald’s “fair opportunityto show that certification

is warranted.” 136 S. Ct. at 672.

In sum, a district court should decline to enter a judgment

affording complete relief on a named plaintiff’s individual

claims, over the plaintiff’s objection, before the plaintiff has

had a fair opportunity to move for class certification. See id.

In this way, even if Pitts were not controlling, a live

controversy would persist until the question of class

certification could be addressed.

CONCLUSION

We hold the judgment Allstate has consented to would

afford Pacleb complete relief on his individual claims for

damages and injunctive relief. To date, however, Pacleb has

not actually received complete relief on those claims. Those

claims, therefore, are not now moot. In addition, because “a

would-be class representative with a live claim of her own

must be accorded a fair opportunity to show that certification

is warranted,” id., we will not, as Allstate urges, direct the

district court to enter judgment on Pacleb’s individual claims

before Pacleb has had a fair opportunity to move for class

certification. Finally, even if Pacleb’s individual claims were

otherwise fully satisfied, he could continue to seek class

certification under Pitts. For these reasons, the district

court’s order denying Allstate’s motion to dismiss the

complaint for lack of subject matter jurisdiction is affirmed.

ORDER AFFIRMED.

* * *

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CHEN V. ALLSTATE INS. CO. 27

Allstate’s motion to supplement the record on appeal,

filed February 12, 2016, is GRANTED.

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