Opinion ID: 8414545
Heading Depth: 2
Heading Rank: 3

Heading: Campbell-Ewald

Text: Geismann ’ argues that the district court erred in dismissing its complaint for lack of subject matter jurisdiction because ZocDoc’s proffered monetary damages did not provide complete relief as to Geis-mann’s individual claims; the individual and putative class claims were therefore not moot. Alternatively, Geismann asks us to conclude, as a matter of first impression in this Circuit, that even if the offer was complete as to its individual claims, an individual judgment does not render moot a putative class claim, at least when a class-certification motion is pending. Cf. Tanasi v. New Alliance Bank, 786 F.3d 195, 198 (2d Cir. 2015), as amended (May 21, 2015), cert. denied, — U.S.—, 136 5.Ct. 979, 194 L.Ed.2d 3 (2016) (declining to address this question). While this appeal was pending before us, the Supreme Court decided Campbell-Ewald. Its decision made clear that an unaccepted Rule 68 offer of judgment does not render an action moot. Campbell-Ewald, 136 S.Ct. at 670-71. Because that decision controls our review and is dispositive of the case at bar, we need not, and decline to, reach the issues raised by Geismann in its pre- Campbell-Ewald submissions. In Campbellr-Ewald, the plaintiff sought individual and class-wide relief under the TCPA, alleging that he and members of the putative class received unsolicited text messages sent by the defendant in violation of the statute. Id. at 667. The defendant, like ZocDoc, “proposed to settle [the plaintiffs] individual claim and filed an offer of judgment pursuant to Federal Rule of Civil Procedure 68,” including an offer to pay “costs, excluding attorney’s fees, and $1,503 per message,” as well as “a stipulated injunction in which [the defendant] agreed to be barred from sending text messages in violation of the TCPA.” Id. at 667-68. The plaintiff, like Geismann, declined the offer. Id. at 668. The Supreme Court concluded that an Article III “case” or “controversy” remained, Rule 68 offer notwithstanding, 6 because “[a]n unaccepted settlement offer — like any unaccepted contract offer — is a legal nullity, with no operative effect.” Id. at 670 (quoting Genesis Healthcare Corp. v. Symczyk, — U.S. —, 133 S.Ct. 1523, 1533, 185 L.Ed.2d 636 (2013) (Kagan, J., dissenting)). “[W]ith no settlement offer still operative, the parties remained adverse; both retained the same stake in the litigation they had at the outset.” Id. at 670-71. In light of Campbell-Ewald, the district court’s conclusion in this ease that Geismann’s claim was “mooted by the amount and content of the Rule 68 offer made by ZocDoc,” Geismann, 60 F.Supp.3d at 407, is incorrect. Rule 68 provides that, “[a]t least 14 days before the date set for trial, a party defending against a claim may serve on an opposing party an offer to allow judgment on specified terms, with the costs then accrued.” Fed. R. Civ. P. 68(a). “The plain purpose of Rule 68 is to encourage settlement and avoid litigation.” Marek v. Chesny, 473 U.S. 1, 5, 105 S.Ct. 3012, 87 L.Ed.2d 1 (1985). Should the offeree decline the offer, however, it “is considered withdrawn.” Fed. R. Civ. P. 68(b). Campbell-Ewald makes clear that such a “withdrawn” offer “ha[s] no continuing efficacy.” 136 S.Ct. at 670. The district court’s entry of judgment, therefore, imbued ZocDoc’s offer with a power it did not possess. The district court’s conclusion in the case now before us is, of course, understandable, it having been reached before Campbell-Eiuald, was decided. And, as we have noted, “our prior case law has not always been entirely clear on this subject.” Tanasi, 786 F.3d at 199. The district court also followed the “typically proper” procedure by “entering] judgment agajnst the defendant for the proffered amount and [ ] directing] payment to the plaintiff consistent with the offer.” Cabala v. Crowley, 736 F.3d 226, 228 (2d Cir. 2013) (per cu-riam). But the basis upon which the district court entered judgment did not exist: An unaccepted Rule 68 offer of judgment does not render an action moot. ZocDoc attempts to distinguish Campbell-Ewald on two grounds. First, unlike Campbell-Ewald, the district court entered judgment in this case, giving effect to the unaccepted offer. We do not find this distinction meaningful because the judgment should not have been entered in the first place. See Campbell-Ewald, 136 S.Ct. at 672 (“[A]n unaccepted settlement offer or offer of judgment does not moot a plaintiffs case, so the District Court retained jurisdiction to adjudicate [the plaintiffs] complaint.”). “Under basic principles of contract law,” id. at 670, “the recipient’s rejection of an offer leaves the matter as if no offer had ever been made.... So assuming the case was live before — because the plaintiff had a stake and the court could grant relief — the litigation carries on, unmooted,” id. (quoting Genesis Healthcare, 133 S.Ct. at 1533 (Kagan, J., dissenting) (internal quotation marks omitted)). The result in Campbell-Ewald cannot be avoided simply by entering a judgment effectuating an otherwise precluded dismissal. ZocDoc notes that the district court did not act reflexively, having carefully considered the content of the rejected offer. Be that as it may, the offer that the district court carefully reviewed was null and void at the time. It is of no moment whether the offer “more than satisfie[d] any recovery Geismann could make under the applicable statute.” Geismann, 60 F.Supp.3d at 406. “When a plaintiff rejects [a Rule 68] offer — however good the terms — her interest in the lawsuit remains just what it was before. And so too does the court’s ability to grant her relief.” Campbell-Ewald, 136 S.Ct. at 670 (quoting Genesis Healthcare, 133 S.Ct. at 1533 (Kagan, J., dissenting)). Geismann also contests whether the offer in fact “more than satisfie[d] any recovery [it] could make under the applicable statute.” Geismann, 60 F.Supp.3d at 406. Indeed, Geismann insisted in its opposition to the motion to dismiss that the amount proffered by ZocDoc did not “provide! ] full satisfaction of [Geismann’s] claim,” in part because the parties had divergent legal theories regarding the amount of damages available under the TCPA. 7 Pl.’s Opp’n to Def.’s Mot. to Dismiss at 14 n.4, Geismann v. ZocDoc, Inc., No. 14-cv-7009, 2014 WL 10752128 (S.D.N.Y. Sept. 25, 2014), ECF No. 53. That constitutes a live controversy precluding dismissal on the basis of mootness. “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, 567 U.S. 298, 132 S.Ct. 2277, 2287, 183 L.Ed.2d 281 (2012) (internal quotation marks omitted). While we recognized prior to Campbell-Ewald that a judgment entered pursuant to an offer can render an action moot where “the parties agree that a judgment should be entered against the defendant,” Tanasi, 786 F.3d at 200 (emphasis added), the offer of judgment alone does not have the same or a similar effect, see, e.g., Hepler v. Abercrombie & Fitch Co., 607 Fed.Appx. 91, 92-93 (2d Cir. 2015) (summary order); Franco v. Allied Interstate LLC, 602 Fed.Appx. 40, 41 (2d Cir. 2015) (summary order). This was neither a case in which the parties agreed to the entry of a particular judgment, see Tanasi, 786 F.3d at 200, nor one in which an accepted offer rendered the plaintiffs claim moot, see Bank v. Alliance Health Networks, LLC, 669 Fed.Appx. 584, 2016 WL 6128043, at , 2016 U.S. App. LEXIS 18849, at  (2d Cir. 2016) (summary order) (stating that although the “Supreme Court has held that an unaccepted Rule 68 offer of judgment, on its own, will not moot a plaintiffs claims,” that rule does not control where, unlike here, the plaintiff “negotiated the check” proffered by the defendants). ZocDoc also argues that Campbell-Ewald is distinguishable because Geis-mann was not left “emptyhanded.” 136 S.Ct. at 672. We disagree. ZocDoc’s unsuccessful attempt to tender judgment notwithstanding, Geismann has not been compensated in satisfaction of its claim, which would require, at a minimum, its acceptance of a valid offer. See id. (“[W]hen the settlement offer ... expired, [the plaintiff] remained emptyhanded; [the plaintiffs] TCPA complaint, which [the defendant] opposed on the merits, stood wholly unsatisfied.”). Geismann thus remains empty-handed, distinguishing this case from the trio of 19th-century tax cases that ZocDoc cites for the proposition that Geismann’s claim is “extinguished”; in each of those cases, the claimant accepted tender. See California v. San Pablo & Tulare R.R. Co., 149 U.S. 308, 314, 13 S.Ct. 876, 37 L.Ed. 747 (1893) (finding that the dispute was resolved by “the offer to pay all [] sums, and the deposit of money in a bank, which by a statute of the state have the same effect as actual payment and receipt of the money” (emphases added)); Little v. Bowers, 134 U.S. 547, 552, 10 S.Ct. 620, 33 L.Ed. 1016 (1890) (observing that there was “no denial of the fact that the taxes in dispute ha[d] been paid” and therefore, implicitly, accepted); San Mateo Cnty. v. S. Pac. R.R. Co., 116 U.S. 138, 141, 6 S.Ct. 317, 29 L.Ed. 589 (1885) (noting that there was no dispute that the “debt for which the suit was brought ha[d] been unconditionally paid and satisfied”). ZocDoc’s post-judgment actions move it no closer to its goal. The order granting leave' to deposit a check in the amount of $6,100.00 with the clerk of the district court in satisfaction of judgment was made pursuant to and in furtherance of a judgment that should not have been entered in the first place. And even if that deposit had satisfied Geismann’s demand for monetary relief, it alone does nothing to satisfy the demand for injunctive relief. Cf. Mey v. N. Am. Bancard, LLC, 655 Fed.Appx. 332, 336 (6th Cir. 2016) (summary order) (observing that “a tender” of monetary damages alone “does nothing to satisfy [the plaintiffs] request for injunctive relief’). This is also not a case that matches the hypothetical posed by Campbell-Ewald, where the Supreme Court declined to consider whether the outcome would be different had the “defendant deposited] the full amount of the plaintiffs individual claim in an account payable to the plaintiff, and the court then enter[ed] judgment for the plaintiff in that amount.” 136 S.Ct. at 672 (emphasis added). Here the district court entered a judgment that should not have been entered in the first place, and ZocDoc then more than one year later deposited an amount in satisfaction of that errant judgment in an account payable to Geis-mann. Accordingly, we need not, and do not, decide whether a different outcome would result if the facts here matched the Campbell-Ewald hypothetical. 8