District Court (Tex.) Finds Rule 68 Offer — Later Revised in a Motion to Dismiss to Accommodate for Additional Calls — Mooted Plaintiff’s Individual TCPA Claim, Requiring Dismissal of Class Action under Genesis; Finds TCPA Does Not Allow Dual Recover Under Both TCPA and Texas Statute

In Masters v. Wells Fargo, 2013 WL 3713492 (W.D. Tex. 2013), here, Judge Sparks found that a Rule 68 Offer in a TCPA Class Action – that was amended in a reply brief to accommodate additional calls alleged by the named Plaintiff – mooted a Plaintiff’s individual claim and requiring dismissal of the Plaintiff’s class action.

Masters’s Response makes much of the idea Wells Fargo’s Rule 68 offer was insufficient to cover its maximum damages under the statute. The parties have some dispute over how many calls are properly pleaded. Nevertheless, Wells Fargo has stipulated it is willing to increase its offer to match the maximum number of calls Masters believes he can plead, which is nine. Wells Fargo’s offer of $13,500 thus fully satisfies Masters’s damages claim.’ Wells Fargo has also stipulated to an injunction, though doing so was probably unnecessary.   See Scott v. Westlake Servs., LLC, No. 12 C 9289, 2013 WL 2468253, at *19 (N.D. Ill. June 6, 2013) (offer to enter injunction and pay the maximum statutory award for each TCPA violation “effectively makes [the plaintiff] whole”). Masters also contends Wells Fargo’s offer is insufficient because it only compensates him for his federal TCPA claim, not his Texas Business and Commerce Code claim. Texas has prohibited the autodialing of cell phones since at least 1989. See Act of June 15,1989, 71st Leg., R.S., ch. 783, § 1, 1989 Tex. Sess. Law. Serv. 783 (amended 1999) (formerly codified at TEx. Bus. & C0M. CODE § 35.47). In 1999, however, the relevant statute was amended and received its first individual cause of action, allowing for private enforcement of the TCPA. Act of June 18, 1999, 76th Leg., R.S., ch. 635, § 1, 1999 Tex. Sess. Law. Serv. 635 (amended 2007) (current version at TEx. Bus. & C0M. CODE § 305.053). The statute has since migrated to TEX. Bus. & COM. CODE § 305.053, but remains substantively the same. There is no indication in either the TCPA or in Texas’s analogue that either legislative body intended to allow double recovery under both state and federal law for the same TCPA violations. The Court’s conclusion is reinforced by Mims, in which the United States Supreme Court held federal and state courts enjoy concurrent jurisdiction over TCPA claims. 132 S. Ct. at 747. Prior to Mims, the law in the Fifth Circuit held state courts had “exclusive jurisdiction over private actions filed under the TCPA.” See Chair King, Inc. v. Hous. Cellular Corp., 131 F.3d 507, 514 (5th Cir. 1997), overruled by Mims, 132 S. Ct. at 747. It thus makes sense for Texas to have adopted a statute implementing the TCPA’s private right of action, lest Texas citizens be left without a forum. These authorities suggest plaintiffs have a choice of forum rather than two separate avenues for recovery. . . . There is no question Masters did not accept Wells Fargo’s initial Rule 68 offer, and apparently he has no intention of accepting Wells Fargo’s amended offer.4 Masters argues his refusal to accept the offer prevents his TCPA claim from becoming moot. The Court disagrees. In Genesis, the United States Supreme Court recognized a circuit split on the question “whether an unaccepted offer that fully satisfies a plaintiff’s claim is sufficient to render the claim moot.” 133 S. Ct. at 1528. The Court expressly reserved judgment on the question: “we do not reach this question, or resolve the split, because the issue is not properly before us.”  Id. at 1528-29; see also id. at 1537 (Kagan, J., dissenting) (chiding the majority for failing to resolve the circuit split). Masters’s TCPA claim is moot because he has been offered the maximum award he can possibly receive under the statute; his TDCA claim is not moot because he has not received such an offer with respect to that claim. Wells Fargo has moved only to dismiss the TCPA claim. The motion is well taken, and the Court will GRANT the motion and dismiss Masters’s individual TCPA claim (and, by extension, his state law analogue claim) as moot.

The District Court then held that Plaintiff’s class action could not survive the satisfaction of Plaintiff’s individual claim:

Masters argues his putative class action claim survives even if his individual TCPA claim has been mooted by Wells Fargo’s offer, and therefore Masters continues to have a stake in the outcome of his TCPA claim. Masters’s argument, however, is foreclosed by Genesis. In Genesis, the United States Supreme Court held “the mere presence of collective-action allegations in the complaint cannot save [a Fair Labor Standards Act] suit from mootness once the individual claim is satisfied.” 133 S. Ct. at 1529.

Eric Troutman of the Firm’s Orange County Office briefed and argued the matter.  Eric can be reached at ejt@severson.com