This is yet another post reacting to one of the relatively minor cases the SCOTUS decided last Term. Last week, I discussed two Takings cases (here and here) because I'm scheduled to make a presentation on those cases at the Practicing Law Institute Supreme Court Review session next week. I'm also giving a presentation on class actions. Most of that presentation will focus on the cases I discussed in a column in April, but in the interest of thoroughness, I've read all of the cases that relate to class actions. One such pretty minor case is Genesis Healthcare Corp. v. Symczyk, which is not directly about class actions but about a similar mechanism for representative litigation under a provision of the Fair Labor Standards Act. That provision allows an individual with a FLSA claim to sue on behalf of herself as well as "similarly situated" individuals. The question in the case was whether, if the individual plaintiff's claims have been mooted, she can continue on behalf of the absent similarly situated parties. The majority, in an opinion by Justice Thomas, said no.
Perhaps not surprisingly, the Court divided 5-4 ideologically, with the conservatives joining Justice Thomas and the liberals joining a dissent by Justice Kagan. That's not surprising because, as I noted in the column linked above, the Court frequently divides ideologically about class actions--with liberals frequently regarding them as a means by which persons who could not otherwise afford to litigate can get some measure of justice, and conservatives frequently regarding them as a means by which opportunistic plaintiffs' lawyers extort money from businesses.
What was at least a little surprising was Justice Kagan's tone in dissent, which was extremely snarky. I'm not surprised that Justice Kagan was snarky. As I've noted before, she can be Scalia-esque in going after her colleagues. But in Genesis Healthcare, much of the snark is targeted at the lower federal courts. To see why this is odd--and arguably unfair--requires a bit of context for the case.
The district court and the appeals court in Genesis Healthcare found that the plaintiff's individual claim was moot because she rejected--by failing to accept before the expiration of--an offer of judgment by the defendant that, by its terms, would have given her all of the individual relief she could have gotten by litigating. The hard question for the courts was whether that mooting of the individual claim should be deemed to disqualify the individual plaintiff from representing similarly situated others. If so, the plaintiff argued, that would permit defendants to "pick off" individual litigants, thus frustrating the group representation policy of the FLSA. Nonetheless, the majority found that the mootness problem was insurmountable.
Justice Kagan and the dissenters did not reach the "picking off" problem because she argued in her dissent that the assumption of mootness was simply wrong. And not just wrong but crazy, stupid wrong. So wrong that its wrongness would be obvious to "every first-year law student." The-appeals-courts-should-be-ashamed-of-themselves wrong. Or as Justice Kagan put it:
So a friendly suggestion to the Third Circuit: Rethink your mootness-by-unaccepted-offer theory. And a note to all other courts of appeals: Don’t try this at home.Justice Kagan's core problem with what the Third Circuit did is this: Federal Rule of Civil Procedure 68 authorizes a defendant to make an "offer of judgment"--essentially a formal settlement offer--and if the plaintiff refuses to accept the R. 68 offer but ends up achieving less at trial than the offer of judgment, then the plaintiff bears costs for the intervening period. But, Justice Kagan points out, part (b) of R. 68 permits a plaintiff to reject an offer of settlement and part (d) makes clear that the case then goes forward, with the penalty of costs, not dismissal on mootness grounds. And so, Justice Kagan says, Rule 68 "provides no appropriate mechanism for a court to terminate a lawsuit without the plaintiff’s consent."
I read that and thought to myself: Can the Third Circuit judges and the judges in the other circuits that apply the same approach really be the idiots that Justice Kagan and the other dissenters think they are? So I read the lower court opinion and some of the cases cited therein, and lo and behold, I discovered that the appeals court judges are not idiots. None of the cases says that Rule 68 authorizes a judge to dismiss a case as moot based on a rejected settlement offer. What they say is that general principles authorize a judge to dismiss a case when the defendant offers the plaintiff everything to which the plaintiff is entitled.
Indeed, even Justice Kagan seems to acknowledge as much. After mocking the circuit courts for reading Rule 68 in a way that none of them read it, she considers the possibility that courts have "inherent authority" to dismiss a case as moot based on an offer of full settlement. She seems to say no, but almost immediately, there is a crucial admission. Justice Kagan writes:
To be sure, a court has discretion to halt a lawsuit by entering judgment for the plaintiff when the defendant unconditionally surrenders and only the plaintiff’s obstinacy or madness prevents her from accepting total victory.Why isn't that this very case? Justice Kagan goes on:
But the court may not take that tack when the supposed capitulation in fact fails to give the plaintiff all the law authorizes and she has sought. And a judgment satisfying an individual claim does not give a plaintiff ... exercising her right to sue on behalf of other employees all that she has requested in the complaint (i.e., relief for the class).(Citations and internal quotation marks omitted.)
Right, but now it's not at all clear that Justice Kagan is making anything but a semantic point. The majority asks whether a claim that is moot with respect to the individual claims is nonetheless still live with respect to the representative claims. Justice Kagan says that so long as there are representative claims, the individual claims aren't moot. But isn't that just another way of answering the same question that the majority answers? The majority thinks that settlement of the individual claims renders the plaintiff an improper representative of the similarly situated absentees. The dissent thinks that the individual can still represent the absent similarly situated parties. Fair enough. Yet it's hard to see why that substantive difference of opinion warrants the mocking tone from Justice Kagan.
Justice Kagan does point to one legitimate oddity in the lower court case law: If a settlement offer for everything the plaintiff could get through litigation moots a case, it should only do so if the defendant in fact makes good on the offer--i.e., if the court tells the plaintiff that she must accept the defendant's offer. The mere making of the offer should not be enough to moot the case. Note, though, that nearly all of the circuit court cases I found that recite the rule at issue are in fact cases in which the plaintiff did accept the offer but then argued that ongoing issues made the case not moot. It does appear that the district court in Genesis itself ordered dismissal without ordering the defendant to pay up on its offer, but if that's the core of Justice Kagan's complaint, then she and the other dissenters should have said that a mootness dismissal must come with payment, not that a mootness dismissal is absurd.
Bottom Line: Justice Kagan comes across as a bit of a bully in this dissent. The entertainment value of such bullying is dubious in general but doubly dubious where, as here, it appears largely unjustified as a substantive matter.