Spice v. Blatt, Hasenmiller, Leibsker & Moore LLC
Filing
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OPINION AND ORDER denying 32 Plaintiffs MOTION to Strike Offer of Judgment. Signed by Chief Judge Theresa L Springmann on 9/19/17. (nal)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
GLORIA SPICE, on behalf of herself and
all others similarly situated,
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Plaintiff,
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v.
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BLATT, HASENMILLER, LEIBSKER & )
MOORE LLC,
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Defendant.
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CAUSE NO.: 1:16-CV-366-TLS
OPINION AND ORDER
Plaintiff Gloria Spice, on behalf of herself and all other similarly situated, has filed a
class action complaint alleging violations of the Fair Debt Collection Practice Act (FDCPA). On
May 26, 2017, she filed a motion to certify the class. This matter is before the Court on the
Plaintiff’s June 12, 2017, Motion to Strike Offer of Judgment [ECF No. 32] that the Defendant
submitted to the Plaintiff on June 9, 2017, pursuant to Federal Rule of Civil Procedure 68. The
Defendant offered to allow judgment in favor of the Plaintiff, individually, in the amount of
$1,100.00 in damages, plus costs and reasonable attorneys’ fees. The Plaintiff argues that the
offer should be deemed ineffective as an improper attempt to “pick off” the class representative
by putting her in the position to choose between accepting the offer and abandoning the class for
her own pecuniary benefit, or rejecting the offer and face the potential that she will bear the costs
the Defendant incurs after the offer date. The Defendant contends that it properly exercised its
right under Rule 68 by making a reasonable offer, and that the Rule contains no exception for
class actions.
ANALYSIS
Pursuant to Rule 68,
At least 14 days before the date set for trial, a party defending against a claim may
serve on an opposing party an offer to allow judgment on specified terms, with
the costs then accrued. If, within 14 days after being served, the opposing party
serves written notice accepting the offer, either party may then file the offer and
notice of acceptance, plus proof of service. The clerk must then enter judgment.
Fed. R. Civ. P. 68(a). The unaccepted offer is considered withdrawn. Fed. R. Civ. P. 68(b). If the
offer is not accepted, and the plaintiff obtains a judgment for less than the offered amount, the
defendant can file a motion pursuant to subsection (d), requiring the plaintiff to pay the costs
incurred after the offer was made. Fed. R. Civ. P. 68(d) (“If the judgment that the offeree finally
obtains is not more favorable than the unaccepted offer, the offeree must pay the costs incurred
after the offer was made.”). Rule 68(d) does not apply where judgment is entered in favor of the
Defendant. Delta Air Lines, Inc. v. August, 450 U.S. 346 (1981).
No party can be forced to accept an offer of judgment, but Rule 68 is a valid litigation
tool to encourage settlements. See, e.g., Conrad v. Boiron, Inc., — F.3d —, 2017 WL 3623960,
at * 4 (7th Cir. Aug. 24, 2017) (including Rule 68 in the list of tools available in federal court to
address abuses of the litigation process, but specifically excluding forced acceptance of a
proposed settlement offer); Marek v. Chesny, 473 U.S. 1, 5 (1985) (“The plain purpose of Rule
68 is to encourage settlement and avoid litigation. The Rule prompts both parties to a suit to
evaluate the risks and costs of litigation and to balance them against the likelihood of success
upon trial on the merits.” (citations omitted)). Additionally, in the context of class action
litigation, “an unaccepted settlement offer or offer of judgment does not moot a plaintiff’s case.”
Campbell–Ewald Co. v. Gomez, 136 S. Ct. 663, 672 (2016). Although the decision in Campbell-
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Ewald does not specifically address the Plaintiff’s concern that an offer of judgment creates
conflict between herself and the putative class, it nevertheless seems to foreclose the Plaintiff’s
argument.
If, as the Plaintiff argues, an offer of judgment made to a named plaintiff before a class is
certified is automatically ineffective (whether accepted or not), there would have been no need
for the Supreme Court to rule on the impact of an unaccepted Rule 68 offer of judgment for the
full amount of the named plaintiff’s individual claim. Rather, its ruling, that such an offer does
not efface a class action complaint, 136 S. Ct. at 670, would have no legal effect because no such
offer would ever be allowed to stand. Further, a review of the Campbell-Ewald decision reveals
that no Justice endorsed the idea that Rule 68 was inapplicable in class actions. The Supreme
Court’s decision did not eliminate the “built-in sanction” of Rule 68 in the class action context,
but rather, commented specifically on it. See id., 136 S. Ct. at 671 (noting that the “sole built-in
sanction” regarding costs did not support the defendant’s argument that an unaccepted settlement
offer can moot a complaint). On its face, Rule 68 contains no exclusions that forbid its
application to class actions or limits its application to only certain types of cases. Neither does
Rule 23, which governs class actions, purport to create any such exception. This, combined with
the Campbell-Ewald decision, and the absence of any binding Seventh Circuit decision applying
a class action exception to Rule 68, leaves the Plaintiff with only nonbinding, pre-CampbellEwald, district court cases in support of her Motion.
Accordingly, the Court finds no basis to strike the offer of judgment, or to otherwise rule
on its effect. The Court also declines to grant the alternative relief requested in a footnote in the
Plaintiff’s Motion. The Plaintiff asks that if the Court chooses not to deem the offer ineffective,
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that the Plaintiff be provided fourteen days after the date of the Court’s order to reconsider the
Rule 68 offer. Just as the Court cannot force the Plaintiff to accept an offer, neither can it force
the Defendant to keep the offer open for longer than the time set forth in Rule 68(a).
Finally, the Court notes that its decision is not a statement about whether the Plaintiff
would face the payment of costs under Rule 68(d) if a class is certified but the Plaintiff’s
individual award does not exceed the amount of the Defendant’s offer. That issue is not before
the Court, and it would be premature to offer any views at this point in the proceedings.
CONCLUSION
For the reasons stated above, the Court DENIES the Plaintiff’s Motion to Strike Offer of
Judgment [ECF No. 32].
SO ORDERED on September 19, 2017.
s/ Theresa L. Springmann
CHIEF JUDGE THERESA L. SPRINGMANN
UNITED STATES DISTRICT COURT
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