On April 16, 2013, with Justice Clarence Thomas writing for a 5-4 majority, the U.S. Supreme Court ruled that a collective action brought by a worker under the Fair Labor Standards Act (FLSA) was properly dismissed because the worker’s suit was moot and no longer justiciable when she failed to accept an offer of judgment from her employer. According to the Court, “the worker had no personal interest in representing putative, unnamed claimants, nor any other continuing interest that would preserve her suit from mootness.” Thus, the Court ruled that “the mere presence of collective-action allegations in the complaint cannot save the suit from mootness once the individual claim is satisfied.” Genesis Healthcare Corp. et al. v. Symczyk, No. 11–1059, U.S. Supreme Court (April 16, 2013).

Factual Background

In 2009, Laura Symczyk filed a lawsuit on behalf of herself and “all other persons similarly situated” arguing that her employer violated the FLSA. Symczyk’s employer made an offer of judgment under Federal Rule of Civil Procedure 68, including a payment for alleged unpaid wages, attorneys’ fees, costs, and expenses and stipulating that if Symczyk did not accept the offer within 10 days, it would be deemed withdrawn. Symczyk failed to respond to the offer. Her employer then filed a motion to dismiss arguing that because it offered her complete relief on her individual damages claim, she no longer possessed a personal stake in the outcome of the suit, rendering her action moot.

The trial judge dismissed the suit after concluding that no other individuals had joined the suit and that the Rule 68 offer of judgment fully satisfied Symczyk’s individual claim. While the Third Circuit Court of Appeals agreed that the Rule 68 offer mooted Symczyk’s claim, it reversed the lower court’s finding that the collective action is not moot. The court explained that “strategic” use of Rule 68 offers before certification could “short-circuit the class action process” and “prevent a putative representative from reaching the certification stage.”

Legal Analysis

Justice Thomas started by noting that to invoke federal court jurisdiction, a plaintiff must show that he or she has a legally cognizable interest or personal stake in the outcome of the action. A corollary to this requirement is that an actual controversy must exist at all stages of review and not merely when the complaint is filed–otherwise the action must be dismissed as moot. The Court assumed without deciding that Symczyk’s individual claim is moot (Symczyk conceded this in the lower court and did not raise it before the Supreme Court) and instead turned to whether her action was justiciable based on the collective action allegations in her complaint.

According to Justice Thomas, “straightforward application of well-settled mootness principles compels” the conclusion in this case. Since no other claimants opted in, Thomas concluded, Symczyk’s suit “became moot when her individual claim became moot, because she lacked any personal interest in representing others in this action.” Thus, Symczyk’s case was appropriately dismissed as moot.

Additionally, distinguishing Symczyk’s FLSA action from other collective actions, Thomas noted that under the FLSA conditional certification of a class does not produce a class with an independent legal status. Thus, even a conditional certification ruling on remand would not preserve Symczyk’s suit from mootness.

Practical Impact

According to Patrick F. Hulla, co-chair of the firm’s Class Action Practice Group and a shareholder in Ogletree Deakins’ Kansas City office: “There are several trends that will likely emerge from this decision. First, for collective actions in their infancy, we should expect more plaintiffs to move for conditional collective action certification to be filed shortly after complaints are filed. To avoid the court’s ruling, more and more of these cases are likely to be pled as hybrid class and collective actions. Likewise, to avoid the Rule 68 bar, plaintiffs will likely begin filing more cases in state court under state law. Now, it would be ideal if the U.S. Supreme Court would consider the incompatibility of hybrid cases, which may be more attractive if substantially more wage and hour claims that are filed in federal court include an analogous state law claim. Perhaps the court was hinting at this eventuality by stating ‘Rule 23 actions are fundamentally different from collective actions under the FLSA.’”

According to A. Craig Cleland, co-chair of the firm’s Class Action Practice Group and a shareholder in Ogletree Deakins’ Atlanta office: “Several times the majority contrasts Rule 23 class actions and FLSA collective actions as ‘fundamentally different’ creatures. For example, the Court notes that collective actions are about ‘joining co-plaintiffs’ (and, by implication, not about representing absent class members), that conditional certification’s ‘sole’ significance is sending court-approved notice, and that, whatever it means, conditional certification is ‘not tantamount to’ class certification. Plaintiffs may use this dicta to argue not only that lower courts should not apply Dukes in collective actions but also that the conditional-certification standard is not rigorous (as Rule 23’s requirements are) and that lower courts addressing conditional certification should defer the similarly–situatedness analysis to decertification and focus instead on notice.”

According to Michael W. Fox, a shareholder in Ogletree Deakins’ Austin office: “I had hoped that when the U.S. Supreme Court dealt with a collective action case this term that they might somehow wander into what seems to be an issue never subject to review, namely the standard for conditional certification of a collective action under 29 U.S.C. 216(b). Instead, what we got, at least according to Justice Kagan’s dissent, was a decision that can be ‘relegated…to the furthest reaches of your mind: The situation it addresses should never again arise.’ The majority holding was assuming, as it said the employee had conceded, that the offer made her by the company did moot her claim and that she had no right to proceed with her collective action on the part of others. According to Justice Kagan, that concession was a mistake made by both the plaintiff and the Third Circuit and was in fact a situation that should never happen again. But ultimately, we really are talking about a relatively small number of cases, when the big question that needs to be addressed is the standard to apply in conditional certification: Is the lenient standard really the correct one?”


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