Massachusetts Federal Court Dismisses Putative Class Action Because Defendant’s Unconditional Checks for Named Plaintiff’s Maximum Damages, Even Though Uncashed, Mooted Suit -

In Demmler v. ACH Food Companies, Civil No. 15-13556-LTS (D. Mass June 9, 2016), plaintiff sued a food product manufacturer individually and on behalf of a putative class of Massachusetts purchasers, alleging defendant’s labeling of certain sauces as “all natural” in spite of their containing caramel color violated Mass. Gen. L. ch. 93A, the state’s unfair and deceptive practices statute. Defendant moved to dismiss, arguing the case was moot because on two occasions before suit defendant had mailed plaintiff a check (notwithstanding that he had returned it uncashed each time) for his maximum potential damages.

The court granted defendant’s motion, holding the checks indeed equaled or exceeded plaintiff’s maximum potential damages of $75, representing statutory damages of $25 trebled for willful or knowing misconduct, so that there was no longer a live controversy between plaintiff and defendant. The court rejected plaintiff’s argument the tendered check was a mere conditional offer of settlement, which the United States Supreme Court in Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663, 669 (2016) (see Foley Hoag Product Liability Update January 2016), held was the legal effect of an offer of judgment pursuant to Fed. R. Civ. P. 68 that went unaccepted by plaintiff and hence lapsed, so that a live controversy remained. Here defendant’s check provided funds that were unconditionally plaintiff’s and thus made him whole without his having to agree to or accept anything.