Release Date: January 20, 2016
BUFFALO, N.Y. – A Supreme Court decision ruling a class action lawsuit can continue, even after a business offers to fully pay the first person who brought suit is a “big win for consumers,” says University at Buffalo Law School Professor Christine P. Bartholomew.
“Class actions are essential to private enforcement of laws, particular consumer protection laws,” says Bartholomew, associate professor of law at UB and an expert on civil procedures and class actions. “Had the court decided differently, companies could essentially pick-off plaintiffs, settling class actions for a fraction of the defendant’s actual wrongdoing.”
Today’s Supreme Court decision stemmed from a case involving text messages sent during a recruitment campaign the defendant, Campbell-Ewald Company, sent as part of an ad campaign for the Navy. The texts were unsolicited and thus a potential violation of the Telephone Consumer Protection Act. Under the act, Campbell-Ewald was liable for $1,500 per unsolicited text, up to the statutory cap.
Jose Gomez, a California resident, brought a class action against the company. Campbell-Ewald offered to settle with Gomez for $1,503, far less than the company would be liable for in a class action involving all the potential recipients of the unsolicited texts. Gomez turned down the settlement.
On appeal, the company argued the case should not have been able to go forward because the offer to settle made Gomez’ claim moot. The Ninth Circuit disagreed, affirming the trial court decision. The company appealed to the Supreme Court, who upheld the circuit court decision.
The ruling is somewhat of a surprise for the Supreme Court under Chief Justice John Roberts, according to Bartholomew. The court has repeatedly issues decisions that have disfavored class actions, siding on behalf of class action reform and business rather than consumers, Bartholomew says.
“While today’s decision does not go far enough to strengthen class action mechanisms, it is a step in the right direction,” she says.
Bartholomew is available for interviews, by request, on the Supreme Court decision, as well as issues on class action, anti-trust and consumer protection.