Florida District Court Dismisses Class Action Complaint Against Tampa Bay Buccaneers Due Rule 68 Offer Of Judgment

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Jeffrey M. Stein, D.D.S., M.S.D., P.A., et al. v. Buccaneers Limited Partnership, No. 8:13-cv-02136-SDM-AEP (Oct. 24, 2013).

Three dentists, a pest control service and two other alleged recipients of unsolicited faxes selling football tickets filed a class action Complaint against the Tampa Buccaneers for allegedly violating the TCPA. Within three days of removing the case to federal court, Defendant made an offer of judgment under Rule 68 to each Plaintiff. Two days later, Defendant moved to dismiss the Complaint, advocating the absence of an Article III “case or controversy” due to the Rule 68 offer of judgment. The next day, Plaintiffs moved for class certification, contending that Defendant “sent facsimile advertisements to at least 100,000 different facsimile numbers.”

Addressing Defendant’s Motion to Dismiss, the Court noted that a:

“‘prudential question appears: Why should an action continue to consume scarce resources of the United States merely to permit a plaintiff to pursue a remedy that is available immediately, unconditionally, and without further cost to anyone?’ Of course, a person of ordinary prudence would doubt the veracity of the report that a typical plaintiff had declined an immediate offer of complete relief, and upon receiving confirmation of the report the person undoubtedly would say, ‘Well, something else must be going on here.’ The ‘something else’ is plainly seen by anyone who looks. Assuming the truth of the allegation that 100,000 telephone numbers received a facsimile from the defendant and assuming that each recipient is a member of the class and each is entitled to the statutory $500, the potential penalty for the defendant balloons to $50 Million. If the plaintiffs sustain the allegation that the defendant ‘willfully or knowingly’ violated the statute, the penalty trebles to $150 Million. Either penalty is a formidable recovery for a class of persons whose sole injury is receipt of a facsimile advertising football tickets. And in either instance the attorney’s fees (payable from the “common fund”) undoubtedly will soar astronomically, notwithstanding that each plaintiff receives $500 or $1,500 (minus the attorney’s fees).”

Recognizing that on the one hand, the “case or controversy” requirement is not “negotiable or subject to casual ‘exception,’ is not subordinate to the economic aspirations of either the plaintiffs or the plaintiffs’ lawyers, and is not subject to circumnavigation by legislation or rule, either an agency’s rule or a court’s rule,” and on the other hand, a defendant’s “picking off” a class representative by means of a targeted settlement offer — a practice that, if ungoverned, subverts the interests protected by Rule 23, the court held that there was a simple, neutral, conclusive, balanced and reliably administered rule that distinguishes between a bona file and dispositive offer of judgment, which is protected as an encouraged form of settlement, and the unseemly tactic of “picking off” a class representative, which is prohibited as predatory – if the offer of judgment precedes a Motion for Class Certification, it is not a prohibited “pick-off.”

Because the offer of judgment was made before the Motion for Class Certification, there was no case or controversy, and the case was dismissed.