by Greg Beck
As Brian Wolfman previously noted on this blog, the Supreme Court's holding in Genesis HealthCare v. Symczyk—that a defendant's settlement offer to a named plaintiff defeated certification of a collective action—was based on an highly questionable assumption: that a rejected offer of judgment under Federal Rule of Civil Procedure 68 mooted the named plaintiff's individual claim. Though noting a circuit split on that question, the Court declined to resolve it because the plaintiff had conceded the point below. Now, the Supreme Court is poised to announce whether it will grant certiorari in Convergent Outsourcing v. Zinni, a case involving only a non-class claim that the petitioner debt collector argues presents the question left open in Genesis. As our firm and Public Citizen argue (here and here), petitioners are wrong about that. But the Court has already twice held the case, and that gives at least some reason for concern. Absent another hold, we should learn the Court’s decision on Monday.
Unlike Genesis, the sole question in Zinni is whether the defendant's rejected settlement offer mooted the plaintiff's individual claim. The debt collector successfully argued in the district court that sending an email to the plaintiff's counsel offering $1,001 in statutory damages ($1 more than the maximum statutory damages under the plaintiff’s Fair Debt Collection Practices Act claim) plus "reasonable" attorneys' fees mooted the case. In an appeal consolidated with two similar FDCPA decisions, the Eleventh Circuit reversed, holding that in the absence of an offer of an enforceable judgment, the defendant's offer—even if accepted—would not have provided the plaintiff with complete relief. As the court explained, Zinni’s acceptance of the offer would have left him with nothing more than the defendant's “promise to pay,” which at most would have entitled him to pursue a breach of contract suit in state court. (In fact, Zinni's counsel has repeatedly been forced to bring such suits against debt collectors who reneged on similar settlement agreements.)
The defendant filed a petition for certiorari, which, in a coincidence of timing, was originally set to be conferenced just days after Genesis was decided. Seizing on the decision, the defendant in a last-minute supplemental brief argued that Zinni presents the perfect opportunity to answer the question left unresolved in Genesis: whether "an unaccepted offer that fully satisfies a plaintiff's claim is sufficient to render the claim moot." But, as we explain in our response, the Eleventh Circuit's decision in Zinni never decided that question. On the contrary, the decision was based on the court’s conclusion that, in the absence of an offer of judgment, the defendant's offer would not have fully satisfied the plaintiff's claim.
The defendant's position that an informal offer of less than full relief is sufficient to moot a case is therefore far more extreme even than the position vehemently rejected by the four dissenters in Genesis. If accepted, it would give defendants the power to unilaterally deprive federal courts of jurisdiction merely by sending an email. Even if the plaintiff accepted the offer, the district court would lack jurisdiction to enforce the settlement or even to determine the "reasonable" attorneys' fees provided by its terms. And a plaintiff who, like Zinni, rejected the offer would be left in an even worse position, with neither a settlement agreement nor enforceable judgment and thus without any means to obtain relief on his claims.
Although its decision to twice hold the petition is worrisome, the Court is unlikely to endorse such a result.