176 F. Supp. 3d 725
E.D. Mich.2016Background
- Plaintiffs Bridging Communities and Gamble sued Top Flite under the TCPA, alleging Top Flite caused Business to Business Solutions (B2B) to send unsolicited fax advertisements to 4,271 unique fax numbers, including the plaintiffs, in March 2006.
- B2B purchased a list from InfoUSA and broadcast fax ads without obtaining prior consent from listed businesses; Top Flite hired B2B for the campaign.
- The district court denied class certification (Rule 23) after concluding individualized issues predominated; plaintiffs appealed that denial to the Sixth Circuit.
- Top Flite served Rule 68 offers of judgment to each plaintiff for $1,550; plaintiffs did not accept within 14 days, but later the district court entered separate $1,550 judgments and dismissed the case based on Top Flite’s Rule 68 offers; plaintiffs appealed those orders as well.
- While the appeals were pending, Top Flite tendered $1,550 checks to each plaintiff (which were not cashed) and sought leave under Rule 67 and 28 U.S.C. §§ 2041–2042 to deposit the funds with the court and have the clerk note satisfaction of the judgments.
- The district court granted immediate consideration of the motion but denied Top Flite’s request to deposit the funds, finding the motion impermissibly aimed at mooting or circumventing the pending appeal and class-certification review.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the district court had jurisdiction to accept Top Flite’s proposed deposit while appeals were pending | Plaintiffs argue the appeal challenges both denial of class certification and the Rule 68 judgments; deposit would moot class issues and thwart appellate review | Top Flite argues the appeal concerns only class certification and the district court can accept funds to avoid accruing interest and collection risks | Denied: Court held the appeal implicates both issues and Rule 67 cannot be used to moot or shortcut appellate review; deposit was improper |
| Whether Rule 67 may be used to effectuate payment and satisfy judgments while an appeal is pending | Plaintiffs: Rule 67 is only a safe-keeping device for disputed funds, not a mechanism to transfer property or extinguish class claims | Top Flite: Depositing funds protects against interest and collection exposure and should be allowed despite the appeal | Held for Plaintiffs: Rule 67 cannot be used to effect a legal transfer or to deprive plaintiffs of the opportunity to pursue class certification on appeal |
| Whether Top Flite’s attempt to deposit funds would moot plaintiffs’ standing to continue class-certification appeal | Plaintiffs: Deposit would moot the plaintiffs’ individual claims and thus eliminate the class representative’s stake before class issues are resolved | Top Flite: Deposit merely satisfies judgments and is unrelated to class-certification issues | Held for Plaintiffs: Court found deposit would improperly interfere with the appeals process and plaintiffs’ ability to seek class certification |
| Whether the district court should permit immediate consideration of the motion to deposit funds | Plaintiffs: Motion should be denied and is procedurally improper | Top Flite: Urgent relief needed to avoid prejudice from outstanding judgments | Held: Court granted immediate consideration but denied the substantive motion to deposit funds |
Key Cases Cited
- Charvat v. EchoStar Satellite, LLC, 630 F.3d 459 (6th Cir. 2010) (establishes federal jurisdiction over TCPA claims in Sixth Circuit)
- Mims v. Arrow Fin. Servs., LLC, 132 S. Ct. 740 (U.S. 2012) (confirms federal-question jurisdiction for TCPA claims)
- N.L.R.B. v. Cincinnati Bronze, 829 F.2d 585 (6th Cir. 1987) (a notice of appeal divests the district court of jurisdiction over matters on appeal)
- Marrese v. American Academy of Orthopaedic Surgeons, 470 U.S. 373 (U.S. 1985) (discusses limits on district-court action after notice of appeal divests jurisdiction)
- Prudential Ins. Co. of Am. v. BMC Indus., Inc., 630 F. Supp. 1298 (S.D.N.Y. 1986) (Rule 67 is for safe-keeping disputed funds and not for effectuating transfers between litigants)
- Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663 (U.S. 2016) (a defendant’s settlement offer does not automatically moot a plaintiff’s claim while class-certification issues remain)