Proposed Hybrid Rule 23 / FLSA Wage-Hour Class Settlement Denied

We have written a few posts about the challenges inherent in obtaining judicial approval of proposed class settlements here at the Missouri and Kansas Class Action Law Blog, and this latest order issued by Judge Kays denying a proposed hybrid wage-and-hour settlement outlines many of those concerns that counsel should be mindful of when negotiating and finalizing a proposed class settlement that will pass judicial scrutiny. (HT to our former colleague Eric Dirks who tipped us off about this order earlier this week – look for a guest post from him in the coming weeks).

In Stewart v. USA Tank Sales and Erection Co., No. 12-05136-CV-SW-DGK, 2014 WL 836212 (W.D. Mo. March 4, 2014), the plaintiffs brought a seemingly straight-forward wage-and-hour claim, alleging that their employer failed to pay them overtime; the wrinkle being that it was a “hybrid” class where plaintiffs bring a claim under both the federal Fair Labor Standards Act (FLSA) and under the state minimum wage law (here, the Missouri Minimum Wage and Maximum Hour Law, or MMWMHL).  As all of you savvy readers know, the class certification standards for these statutes are different, which ultimately became a problem down the road.

According to the order, the proposed settlement was negotiated with the assistance of a mediator within six months of the filing of the complain; informal discovery was exchanged, but there was no substantive motion practice.  While this sounds admirable and efficient, Judge Kays ultimately rejected the proposed agreement for a number of reasons:

  • Allowing Defendant to Serve as Claims Administrator with reversion provision “problematic” and “conflict of interest”

The  proposed settlement contained a reversion provision under which all settlement money not claimed by class members reverted back to an employer.  While these are not uncommon, they have been criticized because it could be evidence of potential collusion resulting in significant fees to plaintiffs’ counsel, especially if claim rates are low, resulting in limited benefits to the class. Id. at *6. While not objectionable in and of itself, the court found that the defendant’s role as claims administrator was a “patent conflict of interest” because the defendant “will have a financial incentive to deny class members’ claims.”  Id.  at *9.

  • Settlement Claim Form did not allow class members who wished to participate in FLSA settlement the opportunity to opt-out of Rule 23 state law settlement
This is where the hybrid Rule 23 / FLSA class became a potential landmine – the proposed claim form allowed class members to opt-out of both settlements, or “do nothing” to participate in the Rule 23 state law settlement, but not “opt-in” to the FLSA class.  The court found it problematic that the proposed settlement did not make any provision for a class member who wanted to participate in the FLSA settlement, but chose to opt-out of the state law settlement.  Id. at *7.  While the problem was likely academic, the court did not think it was fair that for a class member to receive a full share of the state law settlement, the class member also had to opt-in to the FLSA settlement as well.
  • Claim Provision for Rule 23 state law settlement unnecessary

Because all class members were current or former employees, and given relatively small class (~260) the court questioned whether “claims” needed to be made at all for the Rule 23 state law class, because the defendant could ensure “maximum participation” by mailing a settlement check directly to each class member.  Id.

  • Proposed class representative awards not supported by record

The parties proposed class representative incentive awards of $17,000 and $25,000, or approximately 4-6 times the average class member benefit.  The court found that a typical enhancment payment was between “$500 and $10,000″ depending on the work performed.  The court concluded that there was nothing in the record to support such an award.

  • Attorney’s Fee award problematic 

As a final matter, the court was concerned about the attorney fee award, where counsel was guaranteed its proposed fee “regardless of how many class claims are paid or how much the individual class members receive.”  Id. at *8.  The court was also concerned that plaintiff’s counsel proposed fee award had a “clear sailing” provision, which it called “prima facie evidence of simultaneous negotiations of merit relief and fees, which is a practice fraught with serious ethical concerns” justifying additional judicial scrutiny.  Id. (citation omitted).

While none of these factors individually would probably torpedo a proposed class settlement, the court noted that their “collective presence is a red-flag for potential collusion” which ultimately prevented judicial approval.

    Guest Post: Use of Rule 68 Offers of Judgment in the Eighth Circuit

    We’re very fortunate  to work with some supremely talented lawyers here at Shook, Hardy & Bacon.  One such lawyer is Rebecca Schwartz, who has recently obtained some superb results for her clients in the data security and privacy context.  We leapt at the opportunity for her to provide this guest post about the current state of the law in using Rule 68 Offers of Judgment in the Eighth Circuit:

    Mechanics of Rule 68.  The mechanics of Rule 68 are straightforward.  Under Rule 68, “a party defending against a claim may serve on an opposing party an offer to allow judgment on specified terms, with the costs then accrued.”  Fed. R. Civ. P. 68.  If the offer is accepted by written notice within 14 days, proof is to be filed with the court and the clerk must enter judgment.  Id.  If an offer is not accepted within 14 days, it is considered withdrawn.  Id.  In the latter event, if the judgment obtained is not more favorable than the offer, then the offeree must pay the offeror’s costs incurred after making the offer.  Id.

     

    Mootness and the Potential Class Representative  “Pick Off.”  Defense counsel in class action litigation have occasionally employed Rule 68 in an attempt to moot the named plaintiff’s claim before a class is certified, thereby “beheading” the putative class.  This is ostensibly done by offering the plaintiff the entirety of his alleged individual damages.  When plaintiff fails to accept such an offer, the defendant then moves to dismiss under Rule 12(b)(1) for lack of subject matter jurisdiction on the grounds that there is no continuing case or controversy.  This move has the best chance of success where the damages are readily calculable (i.e., cases with statutory or defined damages).  It is trickier (and probably impossible) in cases with many variables because complete relief is not knowable.

     

    Circuits Split.  The Circuit Courts of Appeal are split regarding the effectiveness and scope of this “pick-off” maneuver  Case law from outside the Eighth Circuit supports both sides of the “mootness” argument.  For example, the Seventh Circuit has permitted the practice: “[o]nce the defendant offers to satisfy the plaintiffs entire demand, there is no dispute over which to litigate . . . and a plaintiff who refuses to acknowledge this loses outright, under [Rule] 12(b)(1) because he has no remaining stake.”  Rand v. Monsanto Co., 926 F.2d 596, 598 (7th Cir. 1991).  The Ninth Circuit in Diaz v. First American Home Buyers Protection Corp., 732 F.3d 948 (9th Cir. 2013), however, reached the opposite conclusion, relying on a dissenting opinion by Justice Kagen in Genesis Healthcare Corp. v. Symczek, 133 S. Ct. 1523 (2013), wherein the Justice explained that an unaccepted offer of judgment cannot moot a case.  Justice Kagen reasoned that unaccepted settlement offer is a legal nullity and nothing in FRCP 68 authorizes a court to terminate a lawsuit without the plaintiff’s consent.  Other federal courts that have rejected the use of Rule 68 in class actions have found that it to be in direct contravention of Rule 23.

    Eighth Circuit and Missouri District Courts.  Until very recently, neither the Eighth Circuit nor the Western District of Missouri decisions offered much information to defendants contemplating such a move – although the Eighth Circuit had not expressly rejected the possibility altogether.  Since 2010, the issue has come into a little clearer focus, but more recently has resulted in a split of authority in Missouri’s federal district courts.

     

    In 2012, the Eighth Circuit issued a decision in Hartis v. Chicago Title Insurance Co., 694 F.3d 935 (8th Cir. 2012).  In Hartis, the plaintiffs brought claims on behalf of themselves and a putative class alleging that they were overcharged by the defendant title company.  The district court granted the defendant’s motion to dismiss following an unaccepted offer of judgment – but only after it had denied plaintiff’s motion for class certification.  In affirming the dismissal, the court of appeals emphasized that “[j]udgment should be entered against a putative class representative on a defendant’s offer of payment . . . where class certification has been properly denied and the offer satisfies the representative’s entire demand for injuries and costs of the suit.  Id. at 949 (quoting Alpern v. UtiliCorp, Inc., 84 F.3d 1525, 1539 (8th Cir. 1996)).  Of course, in Hartis there was no possibility that any putative class members would be disenfranchised by the “pick off;” it’s not clear how the issue would play out in a case where the offer was made prior to the motion for class certification.

     

    Even more recently, Western District of Missouri Magistrate Judge John Maughmer issued an order in Goans Acquisition, Inc. v. Merchant Solutions, LLC, No. 12–00539–CV–S–JTM, 2013 WL 5408460 (Sept. 26, 2013) in which he endorsed the Seventh Circuit’s acceptance of mootness derived from rejected Rule 68 offers to class representatives where there is a possibility of class certification (i.e., before plaintiff has moved for class certification) (Ed: we covered it here last year).  One case from the Eastern District of Missouri, however, reached an opposition conclusion “to prevent an improper conflict of interest between a putative class representative and the putative class,” but counseled that “in future cases, putative class action plaintiffs would be wise to immediately file such [class certification] motions to protect the class from similar motions to dismiss based on offers of judgment.”  See March v. Medicredit, 2013 WL 6265070 at *3-4 (E.D. Mo. Dec. 4, 2013); see also Mertz v. Lindell Bank & Trust Co., 2012 WL 1080824 (E.D. Mo Mar. 30, 2012).

      SCOTUS: AG suit on behalf of consumers not removable as “mass action” under CAFA

      Happy belated New Year everyone.  We had a great first year here at the Missouri Kansas Class Action Blog and look to continue the trend into 2014.  Let’s start off the new year with a look at a recent Supreme Court opinion involving the Class Action Fairness Act of 2005 (CAFA).  Although the 2012-13 term produced some important class action jurisprudence from the nation’s highest court (which we wrote about here and here), the Supreme Court’s decision in Mississippi ex rel. Hood v. AU Optronics Corp., No. 12-1036 (U.S. Jan. 14, 2014) will probably not affect most practitioners; it is, however, blog-worthy because the Court resolved a circuit split on the issue and arguably narrows the reach of the statute based on the its plain meaning.

      In the case, the Mississippi attorney general filed a parens patriae action in state court against several liquid crystal display (LCD) manufacturers for violating state antitrust and consumer protection laws for allegedly restricting competition and raising prices (is that why my flat panel TV costs so much?).

      The defendants removed the case to federal court under CAFA on the basis that the state represented a class of LCD screen purchasers. The District Court for the Southern District of Mississippi granted the state’s motion to remand, but the Fifth Circuit reversed, holding that the state’s parens patriae action qualified as a “mass action” under CAFA, because it involved claims of “100 or more persons” and in the Mississippi AG’s suit the “real parties in interest”  are the hundreds of consumers in the state, and not the State itself.

      SCOTUS subsequently granted certiorari to resolve a circuit split between the Fifth Circuit and previous conflicting decisions by the Fourth, Seventh, and Ninth Circuits. In a unanimous decision, the Court reversed the Fifth Circuit and held that a suit filed by a state as the sole plaintiff does not constitute a “mass action” under CAFA.  Justice Sotomayor, writing for the Court, explained that its decision was mandated by the plain language of the statute: “[a]ccording to CAFA’s plain text, a ‘mass action’ must involve monetary claims brought by 100 or more persons who propose to try those claims jointly as named plaintiffs. Because the State of Mississippi is the only named plaintiff in the instant action, the case must be remanded to state court.”

      The Court further noted that this interpretation is consistent with CAFA’s statutory language as a whole, as the statute also refers to the “100 or more persons” in a removable  mass action as “plaintiffs” – a term which does not include unnamed parties such as the AG suit at issue.

      While readers of this blog may not encounter parens patriae actions in their daily practice, state attorney generals continue to aggressively enforce their state’s consumer protection laws.  The Hood decision means that these actions will definitively be contested in state court.

        Twombly chews up dog-food class action

        Plaintiff fed his dog Beneful Healthy Weight dog food, and within two weeks, his dog was lethargic, incontinent, and hematuric (blood in urine).  The vet recommended a medicated dog food, and the symptoms disappeared.

        Plaintiff filed a putative class action under the Missouri Merchandising Practices Act (MMPA), alleging that Purina misrepresented its Beneful brand dog food as “healthy,” “wholesome,” “nutritious,” and “100% Complete Nutrition,” and failed to disclose that the dog food caused, or carried the risk of, illness and death in a significant number of dogs.

        Defendant moved to dismiss the complaint, based on Twombly and Rule (9b).  The Court granted the motion (with leave to amend).

        On Twombly grounds, the Court found that the Complaint failed to set for a plausible claim — specifically there was no causation alleged:

        Nothing in the Complaint alleges that the veterinarian diagnosed the bladder stones because of the certain type of dog food the dog ate, nor does the fact that the veterinarian suggested a medicated food for urinary health set out a fact which demonstrates Plaintiff is entitled to relief. So many other factors could have played a role in the dog’s problems that merely stating she ate the food, got sick, got better after eating medicated food for urinary health that Plaintiff’s Complaint fails to set forth a plausible claim showing he is entitled to relief from Defendant.

        And on Rule 9(b) grounds, the Complaint lacked any specific allegations regarding the alleged misrepresentations:

        [T]he allegations fall woefully below Rule 9′s requirements. Plaintiff fails to detail what misrepresentations were made, where the statements were made, to whom, they were made and why they were misleading, and how the alleged misrepresentations were made to Plaintiff. As such, Plaintiff’s claims of misrepresentation are insufficient to state a claim.

        The Court gave Plaintiff a chance to amend his Complaint.  We’ll report back with any meaningful developments.

        The case is Miller v. Nestle Purina Petcare Co., 2014 WL 307271 (E.D. Mo. Jan. 28, 2014).

          Sometimes “Better” Is Not Good Enough: Lessons For Proposed Class Settlements in the D. Kansas

          Here’s an interesting order from the District of Kansas that was published right before the Thanksgiving holiday that demonstrates how a proposed class settlement can get denied not once, but twice, if counsel does not adequately represent all members of the putative absent class.

          In Better v. YRC Worldwide, No. 11-2072-KHV, 2013 WL 6060952 (D. Kan. Nov. 18, 2013), the parties were before the court for a second time for preliminary approval of a securities class action settlement. While the court initially denied approval because plaintiffs failed to satisfy the Rule 23 requirements of typicality and adequacy, it appears the parties did not sufficiently address these deficiencies the second time around. Specifically, the court identified three areas where the parties failed to protect the interests of the putative class:

          First, approval was denied because the Court found that the proposed settlement failed to provide any benefit to certain class members while requiring them to sign a release of their claims.  While the named plaintiffs asserted that Dura Pharms, Inc. v. Broudo, 544 U.S. 336 (2005) mandated this result because the class members would be unable to demonstrate a causal loss connection, the court was unconvinced.  Second, the court found that the named plaintiffs did not adequately represent the entire putative class as there were several subclasses that were unrepresented by the purported class representatives; unsurprisingly, some of these subclasses were provided less relief (or none at all) than the ones represented by the named plaintiffs. As the court noted “plaintiffs have not shown that [the proposed settlement] is fair, reasonable and adequate” to the unrepresented subgroups.

          And as a final matter, the court denied the amended proposed settlement because the parties failed to adequately explain why cy pres distribution was even necessary.  (For more about the controversy over use cy pres class settlements, read this timely post at the Drug & Device Law Blog).  Looking to the American Law Institutes Principles on Aggregate Litigation Section 3.07, the court denied the initial proposed settlement because the parties failed to identify a proposed recipient of any excess funds; this time, the court found fault with the parties’ failure to provide sufficient information why the settlement funds could not be distributed further to class members, or why the named recipient, the FINRA Investor Education Foundation, was an appropriate beneficiary.

          While class settlements can often help parties avoid protracted litigation, they do have to provide some tangible benefit to the putative class.  Perhaps the third time will be the charm for the Better class?

            Guest Post: Fifth Circuit Overrules NLRB’s Prohibition on Class Arbitration Waivers

            Although not arising in either the Eighth or Tenth Circuits, the Fifth Circuit’s opinion in D.R. Horton v. NLRB, No. 12-60031 (5th Cir. Dec. 3, 2013) was widely anticipated because of the underlying decision’s apparent incongruity with the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion.  Our awesome colleagues Bill Martucci and Ashley Schawang from SHB’s National Employment Litigation & Policy Practice have provided us with a great snapshot of the decision:

            The Fifth Circuit Court of Appeals has overruled the National Labor Relations Board’s (NLRB’s) determination that class-arbitration waivers violated the National Labor Relations Act (NLRA). D.R. Horton v. NLRB, No. 12-60031 (5th Cir. Dec. 3, 2013). In upholding the class waiver in D.R. Horton’s arbitration agreement, the Fifth Circuit joined its sister circuits.

            The issue arose in the context of an employee’s claim that the arbitration agreement’s class-action waiver was an unfair labor practice under the NLRA. The employee and a nationwide class had sought to arbitrate claims that their employer, D.R. Horton, misclassified them as exempt from statutory overtime protections, and the company raised the agreement’s bar on collective claims.

            In its 2012 In re D.R. Horton decision, the NLRB held that employers violate the NLRA by requiring employees to sign arbitration agreements prohibiting employees from pursuing claims in a collective or class action. Section 7 of the NLRA mandates that employees have the right to engage in concerted activities for the purpose of mutual aid or protection. The NLRB determined that the class waivers contained within the arbitration agreements violated Section 7, concluding that filing a class action regarding wages, hours or working conditions is protected conduct.

            Rejecting the NLRB’s ruling, the Fifth Circuit found that the NLRB did not give proper weight to the Federal Arbitration Act (FAA) and ruled that the use of class-action procedures “is not a substantive right.” Section 2 of the FAA requires courts to enforce arbitration agreements according to their terms, and courts require the party challenging an arbitration agreement to establish that Congress intended for another statute to override the FAA’s mandate. Finding that the NLRA contains no congressional command to override the FAA, the Fifth Circuit ruled that the NLRB failed to abide by the FAA when it determined that the FAA must yield to the NLRA. Therefore, the arbitration agreements were to be enforced according to their terms, including the class-waiver provisions. The Fifth Circuit noted that it was “loath to create a circuit split” and that every other circuit that had considered the issue had refused to defer to the NLRB’s reasoning.

            The NLRB also held that the class waivers violated Section 8(a)(1) of the NLRA because (1) employees would reasonably interpret the class waiver to preclude or restrict their right to file charges with the NLRB, and (2) the class-waiver provisions required employees to waive their right to maintain joint, class or collective employment-related actions in any forum. The NLRB ordered D.R. Horton to rescind or revise its arbitration agreements to clarify that employees were not prohibited from filing charges with the NLRB or from resolving employment-related claims collectively or as a class. The Fifth Circuit agreed that the arbitration agreement could be misconstrued as waiving employees’ trial and administrative rights and thus upheld the NLRB’s order requiring D.R. Horton to clarify its agreement.

            Judge James Graves concurred in part and dissented in part. He agreed with the NLRB’s finding that the class waiver interfered with the exercise of employees’ Section 7 rights and noted that the NLRB’s specific finding that the agreement violated the NLRA did not conflict with the FAA because the FAA does not require an agreement that violates the NLRA to be enforceable. Judge Graves would have affirmed the NLRB’s decision in toto.

              Time to Give Thanks to the Eighth Circuit for its Decision in Atwell v. Boston Scientific Corp.!

              Last week, the Eighth Circuit published its decision in Atwell v. Boston Scientific Corp., Nos. 13-8031, 13-8032, 13-8033, 2013 WL 6050762 (8th Cir. Nov. 18, 2013), where it held that three multiple-plaintiff actions alleging injury from transvaginal mesh collectively constituted a “mass action” under CAFA (the Class Action Fairness Act of 2005).

              Because of our firm’s involvement in the case, we are going to direct you to the fine synopsis put together by the Drug & Device Law Blog.  Another comprehensive summary was published by Law360.

              We would also like to thank everyone who has read the blog during our first year of publication.  Have a great Thanksgiving!

                Throwing a DART at CAFA Removal – When To Prove Amount In Controversy?

                In the notice of removal, apparently, because it may be too late if you simply plead satisfaction of the amount in controversy and wait until the amount is challenged to prove the underlying calculations.  In Dart Cherokee Basin Operating Co., LLC v. Owens, 730 F.3d 1234 (10th Cir,. September 17, 2013), Judge Hartz, joined by Judges Kelly, Tymkovich and Phillips, dissented from the Court’s denial of en banc review of this issue by an equally divided vote.    In this case, the Petitioner/Defendant had removed the case pursuant to CAFA, and pleaded facts supporting satisfaction of the $5 million amount in controversy, but had waited until the Respondent/Plaintiff challenged the notice of removal to submit a declaration setting forth a calculation of potential liability.  The District Court remanded the case, holding that the declaration was untimely.

                Judge Hartz would have granted review, and argued that the Tenth Circuit owed a duty to the bench and bar to clarify the standard of removal in CAFA cases, and should reject the standard imposed by the District Court as imposing an “excessive” and “unprecedented” burden beyond that contemplated by federal pleading standards under Fed. R. Civ. P. 8(a)(1).  And while the District Court had relied on the Tenth Circuit’s decision in McPhail v. Deere & Co., 529 F.3d 947 (10th Cir. 2008) for the proposition that the party seeking removal has the burden of establishing the amount in controversy by a preponderance of the evidence, Judge Hartz was quick to observe that that case says nothing about what supporting information need be included in the notice of removal, and under what circumstances a removing party may rely on supporting evidence not submitted with the notice of removal.

                In closing, Judge Hartz lamented a lost opportunity to provide much-needed clarity on an unclear issue:

                In short, I think it is important that this court inform the district courts and the bar of this circuit that a defendant seeking removal under CAFA need only allege the jurisdictional amount in its notice of removal and must prove that amount only if the plaintiff challenges the allegation.

                So until further notice, counsel would be well-advised to include proof of the amount in controversy in their notice of removal.  Just to be safe.

                 

                  MMPA claim foreclosed where the alleged unfair practice occurs years after the initial sale or advertisement

                  Hutsler stands for the proposition that a significant lapse of time between (1) advertising and sale of merchandise and (2) an alleged unfair practice will make it difficult for a plaintiff to satisfy the statutory requirement that latter be “in connection with” the former.

                  In 2001, plaintiffs refinanced their home with Wells Fargo.

                  Eleven years passed.

                  In 2012, due to financial difficulty, plaintiffs couldn’t make their payments.  Well Fargo foreclosed on plaintiffs’ home.

                  Plaintiffs sued, claiming that Wells Fargo violated the MMPA “in connection with the sale of the property and/or mortgage loan” based on the way Wells Fargo handled the 2012 foreclosure (e.g., failing to provide plaintiffs with loss mitigation opportunities, foreclosing on plaintiffs’ home without explanation as to why they did not qualify for mortgage assistance; and making plaintiffs wait before answering their telephone calls, and transferring plaintiffs’ calls).

                  Wells Fargo moved to dismiss the MMPA claim, arguing that actions occurring years after the initial sales transaction (i.e. the 2012 foreclosure) cannot be considered “in connection with” the initial sale (i.e. the 2001 refinancing).

                  The Court agreed and found that any actionable conduct during the foreclosure process in 2012 was not “in connection with” the sale or advertisement of the refinancing of plaintiffs’ loan in 2001.  The Court highlighted the statutory requirement that an unfair trade practice must be made “in connection with the sale or advertisement of any merchandise” to violate the MMPA, and that in prior cases, the Court has been “unwilling to stretch the ‘in connection with’ language of the MMPA to include events occurring years after the initial sale.”  Hutsler v. Wells Fargo Home Mortgage, Inc., 2013 WL 5442559, at *3 (E.D. Mo. Sept. 30, 2013).

                  So, if the alleged unfair practice occurs long after the initial sale or advertisement, an MMPA claim probably won’t fly . . .

                    Rule 68: applications to other federal statutory class actions following Genesis

                    Last week, Magistrate Judge Maughmer issued an order in Goans Acquisition, Inc. v. Merchant Solutions, LLC, No. 12-00539, 2013 WL 5408460 (W.D. Mo. Sept. 26, 2013) tackling a popular class action topic these days: To what extent does an unaccepted Rule 68 Offer of Judgment moot a putative class action claim? Although the Supreme Court dodged this ultimate question under the FLSA context in Genesis (read about our previous posts about that case its aftermath here, here, and here), in Goans, Judge Maughmer held that Goans’ claim under the Telephone Consumer Protection Act (“TCPA”), both on an individual and class basis, was mooted by the unaccepted offer.  Slip op. at  *3 ( ”Most federal circuits have found that an offer of judgment that would provide all the relief a plaintiff requests (or is entitled to) has the effect of mooting the action even if the offer is not accepted.”)  The court did, however, find that plaintiff’s conversion claim was not addressed by the defendant’s Rule 68 offer and therefore survived a motion to dismiss.

                    There are a couple of interesting aspects to this decision worth discussing.  First, while the court did not cite the Supreme Court’s recent decision in Genesis, it is the first post-Genesis case in the 8th Circuit which holds that an unaccepted Rule 68 offer can moot a putative class claim prior to class certification.  Here, the court relied upon the Seventh Circuit’s decision in Damasco v. Clearwater Corp., 662 F.3d 891, 896 (7th Cir. 2011) and found that a finding of mootness was appropriate and not prejudicial to a putative class because the case had been pending for over two and half years before the offer of judgment was tendered, which in the court’s view was “more than enough time [for plaintiff] to have compiled a record to support class certification.”  Slip op. at *7.

                    Further, with respect to the operation of Rule 68 offers and particular relief sought, the plaintiff argued that their TCPA claim was not moot because the offer did not address the injunctive relief requested; specifically, a preliminary and permanent injunction from all unsolicited fax transmissions.  The court noted that “while the argument has some superficial appeal,” because the injunctive relief requested was outside the court’s jurisdiction (the statute did not authorize such “an unlimited prophylactic prohibition”) the failure of the offer of judgment to specifically address the claim was meaningless.  Slip op at *4-5, citing Jones v. CBE Group, Inc., 215 F.R.D. 558 (D.Minn.2003).