This case is a class action under the Telephone Consumer Protection Act against a marketing company that caused thousands of texts with recruiting messages for the Navy to be sent to cell phones of people who had not consented to receive them. The defendant attempted to derail the case by making an offer of judgment to the named plaintiff. The plaintiff refused, but the defendant argued that the case was mooted by the offer. The district court rejected that argument, but ultimately granted summary judgment for the defendant on the ground that the company had “derivative sovereign immunity” because it was working under a contract with the Navy. The U.S. Court of Appeals for the Ninth Circuit vacated the district court’s decision. The court of appeals held that the defendant was not immune, and also rejected the defendant’s argument that the case was moot. With regard to mootness, the court held that an offer of judgment that a plaintiff rejects cannot moot his individual claims, and also that even if the individual claims were moot, the class claims would remain justiciable. The defendant filed a petition for certiorari. PCLG assisted in drafting the plaintiff’s brief in opposition to the petition. The Supreme Court granted review.
On January 20, 2016, the Supreme Court affirmed the court of appeals. The Court held that an offer of judgment does not moot a plaintiff’s individual claim even if it would grant complete relief on that claim, and therefore does not bar the plaintiff from seeking to certify a class. The Court’s ruling rested on the fact that an offer (which loses any legal effect once it is rejected) does not disable the court from granting relief to the plaintiff, because the plaintiff has in fact received nothing for his claims. Thus, there remains a dispute in which the court could grant effectual relief. The Court also held that the defendant was not entitled to “derivative sovereign immunity.” A government contractor, the Court held, does not acquire the government’s expansive sovereign immunity. The contractor may be entitled to a defense if it operated entirely within the government’s directions in the contract, but here the contract required the contractor to comply with all federal laws, and government contracting officers made clear that they wanted the contractor to send messages only to people who had consented to receive them.