Antitrust Law Daily Wrap Up, PRIVACY NEWS: Mootness of TCPA claims argued before High Court, (Oct 14, 2015)

By Greg Hammond, J.D.

The Supreme Court heard oral arguments today in which a marketing consulting company for the U.S. Navy seeks to overturn a decision by the U.S. Court of Appeals in San Francisco that found the company could be vicariously liable under the Telephone Consumer Protection Act (TCPA) by allowing a third-party vendor to send unsolicited text messages. The case is of interest to class action lawyers around the country because it questions a plaintiff’s ability to represent a putative class when that plaintiff is offered complete relief from a defendant (Campell-Ewald Co. v. Gomez, Dkt. 14-857).

The case arose after the U.S. Navy contracted with marketing consultant Campbell-Ewald Co. to create and implement a multimedia recruiting campaign, targeting young adults between the ages of 18 and 24. The Navy allowed Campbell-Ewald to send text messages to cell phone users that consented to such solicitation. However, the text messaging campaign was partially outsourced for the creation of a phone number list and for physically transmitting the messages. Jose Gomez received an allegedly unsolicited text message in 2006, when he was 40 years old. He filed a putative class action, alleging that Campbell-Ewald violated the TCPA by sending unsolicited text messages. The district court granted Campbell-Ewald summary judgment, finding that the company was “immune from liability under the doctrine of derivative sovereign immunity.” The appellate court reversed that decision, finding that a defendant may be vicariously liable under the TCPA and Campbell-Ewald was not entitled to derivative sovereign immunity.

In its petition for review, Campbell-Ewald Co. posed three questions: (1) whether a case becomes moot, and thus beyond judicial power of Article III, when the plaintiff receives an offer of complete relief on his claims; (2) whether the answer to the first question is any different when the plaintiff has asserted a class claim under Federal Rule of Civil Procedure 23, but receives an offer of complete relief before any class is certified; and (3) whether the doctrine of derivative sovereign immunity recognized in Yearsley v. W.A. Ross Construction Co., 309 U.S. 18 (1940), for government contractors is restricted to claims arising out of property damage caused by public works projects.

Most of the arguments focused on the first two questions. According to Campbell-Ewald, “when the offer of complete relief is made and when a court has determined that it is, indeed, for complete relief, then the case has come to an end. Now, whether you say it’s—it’s moot at that precise moment or whether you say it starts the ball rolling down the hill towards a dismissal or entry of judgment for the plaintiff based on the terms of the offer, the point is—is that when the defendant has offered everything, the courts can’t go ahead and expound on the law.”

Gomez disagreed, arguing that, “Campbell-Ewald’s mootness argument fails because an offer of complete relief cannot render a case moot. At most, the offer might justify a forced entry of judgment, but not a jurisdiction dismissal.” Anthony Alan Yang of the Department of Justice Office of the Solicitor General agreed, stating the United States’ belief that an unaccepted offer cannot moot a case.

Attorneys: Gregory G. Garre (Latham & Watkins, LLP) for Campbell-Ewald Co. Jonathan F. Mitchell for Respondent. Anthony Alan Yang, Department of Justice.

Companies: Campbell-Ewald Co.

News: Privacy