Radha Geismann, M.D. v. ZocDoc, Inc., 112718 FED2, 17-2692

Docket Nº:17-2692
Opinion Judge:SACK, CIRCUIT JUDGE.
Party Name:Radha Geismann, M.D., P.C., individually and on behalf of all others similarly situated, Plaintiff-Appellant, v. ZocDoc, Incorporated, Defendant-Appellee, John Does 1-10, Defendants.
Attorney:GLENN L. HARA (David M. Oppenheim, on the brief), Anderson + Wanca, Rolling Meadows, Illinois, for Plaintiff-Appellant. BLAINE C. KIMREY (Charles J. Nerko, Vedder Price P.C., New York, New York, Bryan K. Clark, on the brief), Vedder Price P.C., Chicago, Illinois, for Defendant-Appellee. Adina H. ...
Judge Panel:Before: Sack and Raggi, Circuit Judges, and Gardephe, District Judge.
Case Date:November 27, 2018
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

Radha Geismann, M.D., P.C., individually and on behalf of all others similarly situated, Plaintiff-Appellant,

v.

ZocDoc, Incorporated, Defendant-Appellee,

John Does 1-10, Defendants.

No. 17-2692

United States Court of Appeals, Second Circuit

November 27, 2018

Argued: May 14, 2018

Radha Geismann, M.D., P.C., appeals from a judgment of the United States District Court for the Southern District of New York (Louis L. Stanton, Judge) dismissing its putative class action suit against the defendant ZocDoc, Inc., alleging violations of the Telephone Consumer Protection Act. ZocDoc first attempted to render Geismann's action moot by submitting a settlement offer that would afford Geismann complete relief for its individual claims. Geismann rejected the offer. The district court subsequently entered judgment in Geismann's favor in the amount and under the terms of the unaccepted offer and dismissed the action for lack of subject matter jurisdiction on the ground that it had become moot. We vacated the district court's judgment and remanded the case to the district court for further proceedings. ZocDoc again attempted to moot Geismann's action by depositing $20, 000, in full settlement of Geismann's individual claims, in the district court's registry. The district court concluded that ZocDoc's action successfully mooted Geismann's individual claim and putative class action, and accordingly entered judgment in Geismann's favor and dismissed the action. We conclude that the district court should not have entered judgment based on ZocDoc's deposit, nor should it have dismissed Geismann's action on that basis. Accordingly, the district court's judgment is:

VACATED and REMANDED for further proceedings.

GLENN L. HARA (David M. Oppenheim, on the brief), Anderson + Wanca, Rolling Meadows, Illinois, for Plaintiff-Appellant.

BLAINE C. KIMREY (Charles J. Nerko, Vedder Price P.C., New York, New York, Bryan K. Clark, on the brief), Vedder Price P.C., Chicago, Illinois, for Defendant-Appellee.

Adina H. Rosenbaum, Scott L. Nelson, Public Citizen Litigation Group, Washington, D.C., for Amicus Curiae Public Citizen, Inc., in support of Plaintiff-Appellant.

Brian Melendez, Barnes & Thornburg LLP, Minneapolis, Minnesota, for Amicus Curiae ACA International, in support of Defendant- Appellee.

Before: Sack and Raggi, Circuit Judges, and Gardephe, District Judge. [*]

SACK, CIRCUIT JUDGE.

Radha Geismann, M.D., P.C. ("Geismann") filed a class action complaint against ZocDoc, Inc. ("ZocDoc") in the United States District Court for the Southern District of New York, alleging that it1 received unsolicited telecopies (colloquially and hereinafter "faxes") from ZocDoc in violation of the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227 et seq. After Geismann filed the complaint and moved for class certification, ZocDoc made a settlement offer to Geismann as to its individual claims pursuant to Federal Rule of Civil Procedure 68; Geismann rejected the offer. The district court (Louis L. Stanton, Judge) dismissed the action for lack of subject matter jurisdiction, Radha Geismann, M.D., P.C. v. ZocDoc, Inc., 60 F.Supp.3d 404 (S.D.N.Y 2014) ("Geismann I"), reasoning that the rejected offer rendered the entire action moot. The court therefore entered judgment in favor of Geismann. Geismann appealed. Relying in large part on the Supreme Court's decision in Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016), we vacated the judgment and remanded the matter to the district court for further proceedings. See Radha Geismann, M.D., P.C. v. ZocDoc, Inc., 850 F.3d 507 (2d Cir. 2017) ("Geismann II").

On remand, ZocDoc attempted to use another procedural rule to settle Geismann's individual claims: ZocDoc requested and obtained leave from the district court to deposit funds in the court's registry pursuant to Federal Rule of Civil Procedure 67. The funds that ZocDoc deposited with the court represented what ZocDoc regarded as the maximum possible damages Geismann could receive for its individual TCPA claims. The district court agreed with ZocDoc that its deposit mooted Geismann's individual claim, and accordingly entered judgment in favor of Geismann and dismissed what remained of the action. Radha Geismann, M.D., P.C. v. ZocDoc, Inc., 268 F.Supp.3d 599 (S.D.N.Y. 2017) ("Geismann III"). We conclude that this was error and return the case to the district court again for further proceedings.

BACKGROUND

The Complaint

Geismann, a Missouri professional corporation, alleges that it received from ZocDoc, a Delaware corporation, two unsolicited faxes advertising a "patient matching service" for doctors. See Corrected First Amended Class Action Complaint ¶¶ 8-9, at Joint Appendix ("J.A.") 3 & Exhibits A and B to the Corrected First Amended Class Action Complaint, at J.A. 17-18. Both faxes stated, in a legend at the bottom of the fax, that if the recipient wished to "stop receiving faxes," he or she could call the domestic telephone number provided. See Exhibits A and B to the Corrected First Amended Class Action Complaint, at J.A. 17-18.

In 2014, Geismann filed this putative class action against ZocDoc in Missouri state court, alleging that these faxes were unsolicited advertisements in violation of the TCPA, 47 U.S.C. § 227. The TCPA prohibits, inter alia, the use of "any telephone facsimile machine, computer, or other device to send, to a telephone facsimile machine, an unsolicited advertisement, unless" the sender and recipient have an "established business relationship," the recipient volunteered its fax number directly to the sender or through voluntary participation in a directory or other public source, or the fax meets specified notice requirements. Id. § 227(b)(1)(C). The TCPA defines "unsolicited advertisement" as "any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without that person's prior express invitation or permission, in writing or otherwise." Id. § 227(a)(5). Geismann sought between $500 and $1, 500 in statutory damages for each alleged TCPA violation, an injunction prohibiting ZocDoc from sending similar faxes in the future, and costs.2

On the same day that it filed its complaint in state court, Geismann filed a separate motion for class certification pursuant to Missouri law. Geismann defined the proposed class as "[a]ll persons who on or after four years prior to the filing of this action, were sent telephone facsimile messages of material advertising [a] patient matching service for doctors by or on behalf of Defendant." Radha Geismann, M.D., P.C. v. ZocDoc, Inc., No. 14-cv-7009 (S.D.N.Y.), ECF No. 5, at 2.

On March 13, 2014, ZocDoc removed the action to the United States District Court for the Eastern District of Missouri. Two weeks later, ZocDoc made an offer of judgment to Geismann pursuant to Federal Rule of Civil Procedure 68[3] for: (i) $6, 000, plus reasonable attorney's fees, in satisfaction of Geismann's individual claims, and (ii) an injunction prohibiting ZocDoc from engaging in the alleged statutory violations in the future. Geismann rejected ZocDoc's offer because it provided no relief to the other members of the class. ZocDoc subsequently moved to transfer the case to the United States District Court for the Southern District of New York. The district court granted ZocDoc's motion on August 26, 2014.

Geismann I Proceedings in the District Court

After the case was transferred to the Southern District of New York, ZocDoc moved to dismiss the complaint, primarily on the ground that its offer of judgment provided full satisfaction of Geismann's claim, so the action was moot. On September 26, 2014, the district court granted ZocDoc's motion to dismiss for lack of subject-matter jurisdiction, reasoning that, as to Geismann's individual claims, ZocDoc's Rule 68 offer "more than satisfies any recovery Geismann could make/ so "there remain[ed] no case or controversy." Geismann I, 60 F.Supp.3d at 406-07. The court denied Geismann's motion for class certification, reasoning that Geismann could not adequately represent the class without a claim of its own. Id. at 407. The court accordingly entered judgment in the amount and under the terms of the rejected settlement offer, and dismissed the action as moot. Id.

Geismann timely appealed.

Geismann II

On January 20, 2016, after we held oral argument but before we issued a decision, the Supreme Court handed down its decision in Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016). Campbell-Ewald's procedural posture was similar to the Geismann I appeal then before us: The plaintiff filed a putative TCPA class action and the defendant made a Rule 68 offer of judgment to satisfy the plaintiff's individual claims, which the plaintiff rejected. Id. at 667-68. The Supreme Court decided that the defendant's unaccepted Rule 68 offer did not render the action moot because "[a]n unaccepted settlement offer-like any unaccepted contract offer-is a legal nullity, with no operative effect" on the plaintiffs individual claim. Id. at 670 (internal quotation marks omitted). With no settlement offer still operative, the Supreme Court reasoned, "the parties remained adverse" and "both retained the same stake in the litigation they had at the outset." Id. at 670-71. The Supreme Court further noted that "[w]hile a class lacks independent status until certified, a would-be class representative with a live claim of her own must be accorded a fair opportunity to show that certification is warranted." Id. at 672 (internal citation omitted). However, the Supreme Court left open the possibility that "the result would be different if a defendant deposits the full amount of the plaintiffs...

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