Sixth Circuit Interprets Campbell-Ewald

The Sixth Circuit Court of Appeals recently became the latest circuit court to interpret the Supreme Court’s Campbell-Ewald opinion.  Campbell-Ewald, as most practitioners know by now, dealt with a defendant’s attempt to moot a proposed class action by making a Rule 68 offer of judgment to the class representative.

In Wilson v. Gordon, the Sixth Circuit reexamined its “picking off” exception to the mootness doctrine.  The court recounted how, dating back to even before the Supreme Court’s 1980 decision in Deposit Guaranty National Bank v. Roper, it has recognized that “the concern that the defendant … might strategically seek to avoid” class certification by offering to pay off the named plaintiff justifies an exception to the mootness doctrine.

Since Roper, we have recognized this line of reasoning under analogous circumstances. In Carroll v. United Compucred Collections, Inc., we held that a class action was not moot even though the named plaintiffs had been tendered a Rule 68 offer of judgment because a motion for class certification was then pending.

Turning to Campbell-Ewald, the court noted that while the “Supreme Court recently had the opportunity to address the ‘picking off’ exception … [t]he Supreme Court … grounded its holding in ‘basic principles of contract law’ instead.”  The court nevertheless noted that

Though Campbell–Ewald sheds little light on the “picking off” exception, the Court did observe that allowing an unaccepted offer to moot a case would place defendants like Campbell–Ewald “in the driver’s seat,” enabling them to avoid significant class-based liability.  As the Court explained, “Campbell sought to avoid a potential adverse decision, one that could expose it to damages a thousand-fold larger than the bid Gomez declined to accept.”

Based on that reading of Campbell-Ewald, along with other points discussed in the opinion, the Sixth Circuit concluded that the “picking off” exception remains viable.