Tara Smith v. Greystone Alliance LLC
2014 U.S. App. LEXIS 21529
7th Cir.2014Background
- Smith sued Greystone for alleged FDCPA violations; district court certified then decertified class multiple times before Judge Durkin dismissed as moot in 2013; on appeal, the key issue is whether the case is truly moot and whether dismissal for lack of jurisdiction was proper after an offer that allegedly exceeded the plaintiff’s claims; the district court concluded Smith could not recover more than $500 in compensatory damages and dismissed for lack of jurisdiction; this court vacates and remands for merits-based decision; the opinion clarifies that a defendant cannot end a case by offering relief equal to or less than the plaintiff’s demand; mootness does not terminate federal jurisdiction when there is potential relief
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does a settlement offer exceeding the plaintiff’s demand destroy jurisdiction? | Smith argues the offer did not satisfy her entire demand. | Greystone contends the offer resolves the controversy. | No; jurisdiction survives unless offer satisfies the demand. |
| May a court decide merits to reduce the amount in controversy and then dismiss for lack of jurisdiction? | Partial merits ruling cannot foreclose jurisdiction. | Court can dismiss after reducing dispute if no jurisdiction remains. | Court cannot decide merits to forge jurisdiction and then dismiss. |
| Should the case be remanded for merits rather than entered as moot? | Remand appropriate to resolve FDCPA claims. | Dismissal appropriate if no jurisdiction remains. | Remand for merits; judgment vacated. |
Key Cases Cited
- Damasco v. Clearwire Corp., 662 F.3d 891 (7th Cir. 2011) (utilized to discuss merits vs. jurisdiction and relief sought)
- Rand v. Monsanto Co., 926 F.2d 596 (7th Cir. 1991) (no controversy when defendant offers to satisfy plaintiff’s demand)
- Gates v. Towery, 430 F.3d 429 (7th Cir. 2005) (jurisdictional dismissal only proper if defendant offers more than plaintiff’s demand)
- Johnson v. Wattenbarger, 361 F.3d 991 (7th Cir. 2004) (cannot decide merits of one claim to reduce amount in controversy for jurisdiction)
- Greisz v. Household Bank, N.A., 176 F.3d 1012 (7th Cir. 1999) (cannot persist in suit after obtaining what defendant claims plaintiff is entitled to)