Offer of Judgment Rejected by Plaintiff Does Not Render FDCPA Claim Moot and Deprive a Court of Jurisdiction: Sixth Circuit | Practical Law

Offer of Judgment Rejected by Plaintiff Does Not Render FDCPA Claim Moot and Deprive a Court of Jurisdiction: Sixth Circuit | Practical Law

In Conway v. Portfolio Recovery Associates, LLC, the US Court of Appeals for the Sixth Circuit held that, under the US Supreme Court's recent decision in Campbell-Ewald Co., the plaintiff's rejection of an offer of judgment did not moot his FDCPA claim and deprive the court of subject matter jurisdiction.

Offer of Judgment Rejected by Plaintiff Does Not Render FDCPA Claim Moot and Deprive a Court of Jurisdiction: Sixth Circuit

by Practical Law Litigation
Published on 31 Oct 2016 • USA (National/Federal)
In Conway v. Portfolio Recovery Associates, LLC, the US Court of Appeals for the Sixth Circuit held that, under the US Supreme Court's recent decision in Campbell-Ewald Co., the plaintiff's rejection of an offer of judgment did not moot his FDCPA claim and deprive the court of subject matter jurisdiction.
On October 27, 2016, in Conway v. Portfolio Recovery Associates, LLC, the US Court of Appeals for the Sixth Circuit held that under the US Supreme Court's recent decision in Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016), the plaintiff's rejection of an offer of judgment did not moot his Fair Debt Collection Practices Act (FDCPA) claim and deprive the court of subject matter jurisdiction ( (6th Cir. Oct. 27, 2016)).
Sean Conway filed a putative class action against Portfolio Recovery Associates, LLC (PRA) under the FDCPA. PRA moved to dismiss under Federal Rule of Civil Procedure (FRCP) 12(b)(6). After the district court denied PRA's motion, PRA offered Conway an offer of judgment that included all of the relief he sought. Conway declined PRA's offer.
PRA again moved to dismiss, arguing that because PRA had offered Conway all the relief he sought, there was no longer a live controversy before the court. Citing O'Brien v. Ed Donnelly Enterprises, Inc., 575 F.3d 567 (6th Cir. 2009), the district court agreed and:
  • Dismissed the case for lack of subject matter jurisdiction.
  • Entered judgment for Conway.
Conway appealed the district court orders and argued that, under Campbell-Ewald, the offer of judgment did not moot his claim and warrant dismissal for lack of subject matter jurisdiction. PRA disagreed, arguing that:
  • This case was dissimilar from Campbell-Ewald, in that the district court in Campbell-Ewald only dismissed the case, whereas the district court in this case both dismissed the case and granted judgment for Conway.
  • The Sixth Circuit had no jurisdiction over the appeal because the district court granted judgment for Conway, therefore ridding Conway of any further stake in the case.
The Sixth Circuit rejected PRA's arguments, noting that the district court explicitly stated that it only entered judgment for Conway because it believed O'Brien required it to do so. However, the Supreme Court overruled O'Brien in Campbell-Ewald by holding that an unaccepted offer of judgment does not moot a claim. Because the district court relied on overruled precedent, its judgment was erroneous, and Conway still had a stake in the litigation. The Sixth Circuit therefore vacated the district court's judgment and remanded the case.