Antitrust Law Daily Wrap Up, PRIVACY—9th Cir.: Allstate’s unaccepted offer of judgment doesn’t moot TCPA claims, (Apr 13, 2016)

By Greg Hammond, J.D.

Allegations that Allstate Insurance Co. violated the Telephone Consumer Protection Act (TCPA) were not moot, despite Allstate’s offer of judgment, which purportedly would have afforded a consumer plaintiff complete relief on his individual claims. In affirming the district court’s denial of a motion to dismiss the class action, the U.S. Court of Appeals in San Francisco determined that Allstate’s actions did not afford the consumer any actual relief and that his individual claims for damages and injunctive relief were therefore not moot (Chen v. Allstate Insurance Co., April 12, 2016, Fisher, R.).

Two consumers filed a class action against Allstate, alleging violations of the TCPA. Allstate made an offer of judgment to the consumers, agreeing to pay them $15,000 and $10,000, respectively, along with reasonable attorney fees and costs. While one consumer eventually accepted the offer, the other did not. The district court denied Allstate’s motion to dismiss the remaining consumer’s TCPA claims.

Actual relief. The appellate court first noted that Allstate’s offer of judgment would have afforded the remaining consumer complete relief on his individual claims for damages and injunctive relief. Allstate’s actions, however, did not afford the consumer any “actual relief” and therefore did not moot his individual claims. In particular, the court noted that Allstate deposited $20,000 in escrow on the consumer’s individual damages claim and agreed to an injunction on his individual injunctive relief claim. However, because the offer of judgment was not accepted, the consumer has not yet received any relief on his individual claims for damages or injunctive relief, and his claims are wholly unsatisfied, according to the court.

Fair opportunity. Next, the court rejected Allstate’s argument that the court should instruct the lower court to order monetary and injunctive relief on the consumer’s individual claims, thereby mooting them. “[A] would-be class representative with a live claim of her own must be accorded a fair opportunity to show that certification is warranted,” the court noted, citing the Supreme Court’s recent decision in Campbell-Ewald. A live controversy therefore persists until the question of class certification can be addressed in this case, the court concluded.

The case is No. 13-16816.

Attorneys: Mark J. Levin (Ballard Spahr LLP) for Allstate Insurance Co. Abbas Kazerounian (Kazerouni Law Group, APC), Joshua B. Swigart (Hyde & Swigart), and Todd M. Friedman for Plaintiffs-Appellees.

Companies: Allstate Insurance Co.

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