607 F. App'x 91
2d Cir.2015Background
- Plaintiffs (Hepler and others) sued Abercrombie & Fitch asserting federal and state claims; the case proceeded in the Eastern District of New York.
- Abercrombie made offers of judgment that purported to provide the plaintiffs with the relief they sought. Those offers were not accepted.
- The district court dismissed the case as moot and for lack of subject-matter jurisdiction, treating Abercrombie’s unaccepted offers as mooting the action.
- Plaintiffs appealed the dismissal to the Second Circuit.
- The Second Circuit reviewed legal conclusions de novo and factual findings for clear error and addressed the effect of unaccepted offers of judgment on jurisdiction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether unaccepted offers of judgment moot a case or divest jurisdiction | Unaccepted offers do not deprive the court of jurisdiction; plaintiffs relied on precedent that entry of judgment, not mere offer, is required | Offers of judgment that fully satisfy plaintiffs’ claims should be treated as mooting the case | Court held unaccepted offers do not moot the case; district court erred in dismissing for lack of jurisdiction |
| Proper effect of an offer of judgment that tenders complete relief | If defendant tenders complete relief, court should enter judgment under the offer (or otherwise resolve) | Same (defendant may end litigation by offering judgment for all relief) | Court reaffirmed that an offer can lead to entry of judgment but the offer alone does not bind the defendant or eliminate jurisdiction until judgment is entered |
| Whether the offer must be an offer of judgment (vs. settlement) | Plaintiffs emphasized the distinction; only an offer of judgment has this effect | Abercrombie contended its submissions had the effect of mooting | Court confirmed it must be an offer of judgment, not a mere settlement offer |
| Remedial direction on remand after lapsed offers | Plaintiffs sought reinstatement and further proceedings | Abercrombie argued other procedural defenses | Court vacated dismissal and remanded; instructed district court on how to proceed if offers are renewed and noted jurisdictional bases including CAFA |
Key Cases Cited
- Makarova v. United States, 201 F.3d 110 (2d Cir. 2000) (standard of appellate review for jurisdictional dismissal)
- McCauley v. Trans Union, L.L.C., 402 F.3d 340 (2d Cir. 2005) (defendant may end litigation by offering judgment for complete relief)
- Cabala v. Crowley, 736 F.3d 226 (2d Cir. 2013) (distinguishing offers of judgment from settlement offers)
- Abrams v. Interco Inc., 719 F.2d 23 (2d Cir. 1983) (defendant’s offer of judgment is analogous to allowing default judgment)
- ABN Amro Verzekeringen BV v. Geologistics Americas, Inc., 485 F.3d 85 (2d Cir. 2007) (procedures when court has ruled some relief unavailable and defendant later offers judgment for remaining relief)