Can "Mooting" A Class Or Collective Action Be A Sound Defense Strategy?

Procedural rules that govern lawsuits in federal court permit defendants to make an "offer of judgment," which is a mechanism allowing a defendant to offer to settle a lawsuit. If a plaintiff is offered such a settlement and rejects it, and thereafter wins either the same or less than the amount contained in the offer of judgment, the plaintiff generally cannot recover for any costs incurred after rejection of the offer of judgment, such as attorneys' fees. This mechanism can provide settlement leverage and, interestingly, it may now provide a helpful defense strategy for managing class and collective actions.

In Genesis Healthcare Corp. v. Symczyk, the United States Supreme Court recently dismissed a collective action suit brought under the FLSA seeking allegedly unpaid wages on a class basis. In the case, the employee had sued her employer on her own behalf and on behalf of those "similarly situated" under the FLSA for back pay for time she and other employees