Jessica Karmasek Aug. 3, 2016, 4:05pm


CINCINNATI (Legal Newsline) - A federal appeals court, taking up an issue left open by a recent U.S. Supreme Court ruling, said in a decision last month that tendering funds to a class action plaintiff -- not just offering to tender -- still does not moot a case.

The U.S. Court of Appeals for the Sixth Circuit, in its July 6 opinion in Mey v. N. Am. Bancard LLC, was forced to take up a question the Supreme Court declined to answer in Campbell-Ewald Co. v. Gomez.

In its January decision, the Supreme Court ruled an unaccepted offer of complete relief to a named plaintiff in a class action lawsuit does not moot the plaintiff’s claim.

But the nation’s highest court said in Gomez it would not decide whether the result would be different if a defendant deposits the full amount of the plaintiff’s individual claim in an account payable to the plaintiff, and the court then enters judgment for the plaintiff in that amount.

“That question is appropriately reserved for a case in which it is not hypothetical,” Justice Ruth Bader Ginsburg wrote for the majority in the 6-3 ruling.

The defendant in Mey, credit-card processing company North American Bancard LLC, unlike the defendant in Gomez, mailed the plaintiff’s attorney a cashier’s check for $4,500 for three calls that NAB believes it made to Mey.

NAB argues that because the Supreme Court drew a distinction between offering funds -- which does not moot a plaintiff’s claim -- and tendering -- which does -- its sending Mey a cashier’s check is a tender that moots Mey’s claims.

But the Sixth Circuit rejected NAB’s argument, at least in light of the facts before it.

“Even if we assume that an unaccepted cashier’s check could moot a claim, NAB has not shown that its tender satisfies Mey’s demand for relief, which the tender must do if it is to moot Mey’s individual claims,” Circuit Judge Danny Boggs wrote for a three-judge panel including Circuit Judge Karen Moore and Judge Danny Reeves of the U.S. District Court for the Eastern District of Kentucky, sitting by designation.

The panel pointed out that NAB admits that it made three calls to Mey, not just the one call that it mentioned in its Rule 68 offer of judgment.

“But the district court never made any finding as to just how many calls NAB made, and NAB’s recent admission to making three suggests that there may be more that Mey and NAB are not aware of,” Boggs noted in the Sixth Circuit’s nine-page opinion.

“The upshot is that at this point, whether $4,500 provides Mey with all the relief she is entitled to remains unclear. That lack of clarity means that NAB cannot show that Mey has received all of the money damages she has claimed.”

The Sixth Circuit vacated the U.S. District Court for the Eastern District of Michigan’s order dismissing Mey’s class claims and remanded the case back to the court for further proceedings consistent with the appellate court’s opinion.

In January 2014, NAB used an automatic dialing system to make a marketing call to Diana Mey’s cell phone number, in violation of the Telephone Consumer Protection Act.

Mey then brought a federal action against NAB, individually and on behalf of a proposed nationwide class of persons whom NAB had also autodialed without permission.

The district court denied without prejudice Mey’s motion for class certification, citing the need to hold a scheduling conference. NAB then made an offer of judgment to Mey, in which it agreed to pay Mey’s statutory damages and consented to her demand for injunctive relief.

When Mey rejected the offer, NAB moved the court to enter judgment on her individual claims on the ground that the offer of judgment mooted Mey’s claims.

The Eastern District of Michigan agreed, entered judgment in favor of NAB on Mey’s individual claims, and dismissed the class claims. Mey appealed to the Sixth Circuit.

The TCPA restricts telephone solicitations, i.e. telemarketing, and the use of automated telephone equipment.

In particular, the law limits the use of automatic dialing systems, artificial or prerecorded voice messages, SMS text messages and fax machines. It also specifies several technical requirements for fax machines, autodialers and voice messaging systems -- principally with provisions requiring identification and contact information of the entity using the device to be contained in the message.

Generally, the act makes it unlawful “to initiate any telephone call to any residential telephone line using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party” except in emergencies or in circumstances exempted by the Federal Communications Commission.

The law permits any “person or entity” to bring an action to enjoin violations of the statute and/or recover actual damages or statutory damages ranging from $500 to $1,500 per violation.

From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.

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U.S. Court of Appeals for the Sixth Circuit
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