Chen v. Allstate Insurance Co.

Case Updates

The Ninth Circuit rejected the defendant’s attempt to moot the class action by tendering payment of full relief. The panel held both that the individual claims were not moot because the plaintiff had not “actually receive[d]” relief and that, regardless whether the named plaintiff’s claims were mooted, plaintiff could nonetheless seek class certification under Pitts v. Terrible Herbst, Inc., 653 F.3d 1081 (9th Cir. 2011).

In light of the Supreme Court’s decision in Campbell-Ewald, the U.S. Chamber and the Consumer Data Industry Association filed a supplemental amicus brief urging the Ninth Circuit to recognize that a defendant’s tender of payment of full relief mooted a plaintiff’s claims. After previously staying the case pending decision in Campbell-Ewald, the Ninth Circuit asked the parties to file supplemental briefs addressing the impact of the Supreme Court’s ruling on the case before it. The Court in Campbell-Ewald left the door open to an argument that a tender payment of full relief could moot the claims. Thus, the Chamber’s brief argued that, because Allstate tendered the full amount in an escrow account necessary to settle the plaintiff’s individual claims, the case was over—only the plaintiff’s stubbornness kept him from realizing a complete victory.

Gregory G. Garre of Latham & Watkins LLP served as co-counsel for the amici.

The U.S. Chamber and the Consumer Data Industry Association filed an amicus brief urging the Ninth Circuit to hold that when a putative class representative’s claims become moot before a class is certified under Federal Rule of Civil Procedure 23, the entire case—class claims and all—must be dismissed for lack of jurisdiction.

This outcome follows from the Supreme Court’s holding in Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1532 (2013), that in the context of a collective action under the Fair Labor Standards Act, the mooting of an individual plaintiff’s claims before conditional certification under the FLSA moots the entire collective action. The Court’s reasoning in Genesis Healthcare applies equally to putative class actions under Rule 23: A putative class representative has no personal interest in representing unnamed class members before a court decision on certification. And damages claims under Rule 23 are no more inherently transitory than damages claims brought under the FLSA. Accordingly, putative class claims—like uncertified FLSA collective action claims—cannot be saved by the relation back doctrine.

Theodore J. Boutrous Jr. and Robert E. Dunn of Gibson, Dunn & Crutcher LLP represented the U.S. Chamber as co-counsel to the National Chamber Litigation Center.