Campbell-Ewald Co. v. Gomez

2016-01-20

Headline: Court ruled that an unaccepted settlement offer cannot moot a plaintiff’s claim and that a private government contractor cannot claim the Government’s blanket immunity, keeping class-action TCPA suits alive.

Holding: An unaccepted Rule 68 or settlement offer does not moot a plaintiff's individual claim; a private contractor does not receive the Government's blanket "derivative sovereign immunity."

Real World Impact:

Unaccepted settlement offers cannot by themselves end individual claims.
Private contractors can be sued for violating federal law despite government contracts.
Class-action litigation can continue while courts decide certification and damages.

Topics: unsolicited text messages, settlement offers and mootness, government contractors, class actions

Summary

Background

Jose Gomez, a recipient of a Navy recruiting text, sued an advertising firm that helped send the message, claiming he never consented and seeking damages and class relief under the Telephone Consumer Protection Act (TCPA). The company, Campbell-Ewald, offered Gomez complete relief for his individual claim under Rule 68 and a freestanding settlement but denied liability; Gomez did not accept the offers. The company then moved to dismiss, and lower courts reached different results on mootness and on whether Campbell, as a government contractor, shared the Government’s immunity.

Reasoning

The Court addressed two main questions: whether an unaccepted settlement offer extinguishes a plaintiff’s individual claim, and whether a private contractor gains the Government’s blanket "derivative sovereign immunity." Relying on contract principles and Rule 68 that treat an unaccepted offer as withdrawn, the Court held that an unaccepted offer has no operative effect and therefore does not moot the plaintiff’s claim. The Court also held that performing work for the Government does not automatically give a private company the Government’s broad immunity from suit.

Real world impact

The decision means defendants cannot end suits simply by making offers the plaintiff refuses; courts retain the power to decide class certification and other issues. Private companies doing Government work remain subject to suits when they allegedly break federal law. The Court left open narrow questions about deposited payments and preserved further proceedings on the merits.

Dissents or concurrances

A dissent argued that complete offers of relief should moot claims even if unaccepted; a separate justice concurred in the judgment but favored a different historical basis.