WASHINGTON, D.C. - (Mealey's) Individual and collective claims by
the sole named plaintiff in a wage-and-hour collective action were rendered
moot once her employer offered judgment in an amount that represented alleged
unpaid wages plus attorney fees, costs and expenses under Federal Rule of Civil
Procedure 68, a split U.S. Supreme Court ruled on April 16 (Genesis
HealthCare Corp., et al. v. Laura Symczyk, No. 11-1059, U.S. Sup.; See
December 2012, Page 7) (lexis.com subscribers may access Supreme Court briefs and the opinion for this case).
"In the absence of any claimant's opting in, respondent's
suit became moot when her individual claim became moot, because she lacked any
personal interest in representing others in this action. While the FLSA
authorizes an aggrieved employee to bring an action on behalf of himself and
'other employees similarly situated,' 29 U.S.C. §216(b), the mere presence of
collective-action allegations in the complaint cannot save the suit from
mootness once the individual claim is satisfied. In order to avoid this
outcome, respondent relies almost entirely upon cases that arose in the context
of Federal Rule of Civil Procedure 23 class actions, particularly United
States Parole Comm'n v. Geraghty, 445 U.S. 388 (1980); Deposit Guaranty
Nat. Bank v. Roper, 445 U.S. 326 (1980); and Sosna v. Iowa, 419 U.S.
393 (1975). But these cases are inapposite, both because Rule 23 actions
are fundamentally different from collective actions under the FLSA [Fair Labor
Standards Act], see Hoffmann-La Roche Inc., 493 U.S.., at 177-178
(Scalia, J., dissenting), and because these cases are, by their own terms,
inapplicable to these facts. It follows that this action was
appropriately dismissed as moot," Justice Clarence Thomas wrote for the
Chief Justice John G. Roberts Jr. and Justices Antonin
Scalia, Anthony M. Kennedy and Samuel Anthony Alito Jr. joined in the majority
Laura Symczyk initiated the instant collective action in
December 2007 in the U.S. District Court for the Eastern District of
Pennsylvania against her employer, Genesis Healthcare Corp. and Eldercare
Resources Corp. (collectively, Genesis). In February 2010, Genesis filed
an answer to the complaint and served Symczyk with an offer of judgment under
Rule 68 in the amount of $7,500 in alleged unpaid wages plus attorney fees,
costs and expenses. Symczyk declined to respond.
The District Court, unaware of the offer of judgment,
held a scheduling conference on March 8, 2010. Two days later, it entered
an order providing a 90-day initial discovery period. Genesis moved to
dismiss for lack of subject matter jurisdiction.
The District Court "tentatively concluded" that the
defendants' Rule 68 offer mooted the collective action and that it should be
dismissed for lack of subject matter jurisdiction. The court ultimately
dismissed Symczyk's FLSA claim with prejudice and declined to exercise
supplemental jurisdiction over her state law claims. Symczyk appealed.
Reversing, the Third Circuit panel opined that "[a]bsent
undue delay, when an FLSA plaintiff moves for 'certification' of a collective
action, the appropriate course - particularly when a defendant makes a Rule 68
offer to the plaintiff that would have the possible effect of mooting the claim
for collective relief asserted under § 216(b) - is for the district court to
relate the motion back to the filing of the initial complaint."
The panel said that on remand, Symczyk should move for
conditional certification, and if the court finds that the motion was made
without undue delay, it shall relate the motion back to the date Symczyk filed
her initial complaint. Then, if the court permits the case to move
forward as a collective action and at least one other similarly situated
employee opts in, "then defendants' Rule 68 offer of judgment would no longer
fully satisfy the claims of everyone in the collective action, and the
proffered rationale behind dismissing the complaint on jurisdictional grounds
would no longer be applicable. If, however, the court finds Symczyk's
motion to certify would be untimely, or otherwise denies the motion on its
merits, then defendants' Rule 68 offer to Symczyk - in full satisfaction of her
individual claim - would moot the action."
Genesis petitioned the U.S. Supreme Court. Oral
arguments were held Dec. 3.
Justice Elena Kagan, author of the dissent in which
Justices Ruth Bader Ginsburg, Stephen G. Breyer and Sonia Sotomayor joined,
opined that the majority erred in resolving "an imaginary question, based on a
mistake the courts below made about this case and others like it."
The dissenting justices opined that it is an unfounded
assumption that Symczyk's individual claim became moot. "We made clear
earlier this Term that '[a]s long as the parties have a concrete interest,
however small, in the outcome of the litigation, the case is not moot.' Chafin
v. Chafin, 568 U.S. __, __ (2012) (slip op. at 6) (internal quotation marks
omitted). '[A] case becomes moot only when it is impossible for a court
to grant any effectual relief whatever to the prevailing party.' Ibid.
(internal quotation marks omitted). By those measures, an unaccepted
offer of judgment cannot moot a case. When a plaintiff rejects such an
offer-however good the terms-her interest in the lawsuit remains just what it
was before. And so too does the court's ability to grant her
relief. An unaccepted settlement offer-like any unaccepted contract
offer-is a legal nullity, with no operative effect. As every first-year
law student learns, the recipient's rejection of an offer 'leaves the matter as
if no offer had ever been made.' Minneapolis & St. Louis R. Co. v.
Columbus Rolling Mill, 119 U.S. 149, 151 (1886). Nothing in Rule 68
alters that basic principle; to the contrary, that rule specifies that '[a]n
unaccepted offer is considered withdrawn.' Fed. Rule Civ. Proc.
68(b). So assuming the case was live before-because the plaintiff had a
stake and the court could grant relief-the litigation carries on, unmooted,"
Ronald J. Mann of New York represent Genesis. Gary
F. Lynch of Carlson Lynch in New Castle, Pa., and Neal Katyal of Washington
Nicole G. Berner of Washington filed an amicus curiae
brief on behalf of the Service Employees International Union, National Women's
Law Center, Change to Win, National Partnership for Women and Families,
National Consumer League and National Consumer Voice for Long Term Care.
James B. Coppess of the American Federation of Labor and Congress of Industrial
Organizations in Washington filed an amicus brief on behalf of the
American Federation of Labor and Congress of Industrial Organizations.
Rebecca M. Hamburg of San Francisco filed an amicus brief on behalf of
the National Employment Lawyers Association, et al. Mark D. Harris
of Proskauer Rose in New York filed an amicus brief on behalf of the
U.S. Chamber of Commerce, the American Health Care Association, the National
Federation of Independent Business, the National Center for Assisted Living and
the Society for Human Resource Management.
Jocelyn Larkin of The Impact Fund in Berkeley, Calif.,
filed an amicus brief on behalf of The Impact Fund, Asian Law Caucus,
Asian Pacific American Legal Center of Southern California, Bet Tzedek, Disability
Rights California, the Lawyers' Committee for Civil Rights Under Law, the Legal
Aid Society - Employment Law Center, Public Advocates Inc., Public Counsel, the
Public Interest Law Project, Public Justice P.C. and the Western Center on Law
and Poverty. Jonathan S. Massey of Massey & Gail in Washington filed
an amicus brief on behalf of Scholars Stephen B. Burbank, John C. Coffee
Jr., Cynthia Estlund and David L. Shapiro. Danny E. Petrella of Norris,
Tysse, Lampley & Lakis in Washington filed an amicus brief on behalf
of the Equal Employment Advisory Council. Michael D. Slodov of Sessions,
Fishman, Nathan & Israel in Chagrin Falls, Ohio, filed an amicus
brief on behalf of ACA International. Henry M. Sneath of Chicago filed an
amicus brief on behalf of DRI - The Voice of the Defense Bar.
Solicitor General Donald B. Verrilli Jr. and Anthony A. Yang of the Office of
the Solicitor General in Washington filed an amicus brief on behalf of
the United States.
subscribers can access enhanced versions of the opinions cited in this article:
United States Parole Comm'n v. Geraghty, 445 U.S. 388 (1980)
Deposit Guaranty Nat. Bank v. Roper,
445 U.S. 326 (1980)
Sosna v. Iowa, 419 U.S. 393 (1975)
Hoffmann-La Roche Inc. v. Sperling, et al., 493 U.S. 165 (1989)
Chafin v. Chafin, 568 U.S. __, 2013 U.S.
LEXIS 1122 (2012)
Minneapolis & St. Louis R. Co. v. Columbus Rolling Mill,
119 U.S. 149 (1886)
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