Roberts Court Shields Another Corporation From Collective Suit

On Tuesday, another group of plaintiffs suing together lost their case against a corporation. This time, it was workers. Two weeks ago, it was consumers. In both decisions, the same five-justice majority supported their decisions to whittle away corporate accountability mechanisms with procedural rationales that were so results-oriented as to seem nonsensical to the four dissenting justices and other court-watchers.

The latest case, Genesis HealthCare Corp. v. Symczyk, involved health care workers who claimed they were being docked pay for a 30-minute lunch break even when they worked. In what is known as a “collective action” (similar to a class action), one worker files a claim under the Fair Labor Standards Act, and others who are similarly situated later join on to seek a complete resolution to the issue.

So here’s what Genesis did. It offered the first representative plaintiff $7,500 to settle her claim and gave her ten days to respond. Laura Symczyk never responded, presuming the case would continue on. But that’s not what happened. Instead, Genesis successfully argued that Symczyk’s case became moot when she rejected the offer, because the sum of money would have resolved her case in its entirety and she no longer had any claim before the court.

Of course, as Justice Elena Kagan so pointedly makes clear in her dissent, it isn’t true that an unaccepted settlement offer ends a case. “As every first-year law student learns, the recipient’s rejection of an offer ‘leaves the matter as if no offer had ever been made,’” she writes. But somehow, several lower courts accepted the defendants’ argument that the offer mooted Symczyk’s individual case, and plaintiffs conceded the point. And because plaintiffs didn’t appeal on that issue, the majority accepts a conclusion that, as Justice Kagan writes, “the facts will show to be ridiculous” and “ensures it will reach the wrong decision.” In fact, according to Kagan and her fellow dissenters, not only is the majority wrong in this case; there is no way that a settlement offer could ever moot a case. So that’s that. This case would have no applicability to any other case, leading Justice Kagan to advise, ”Feel free to relegate the majority’s decision to the furthest reaches of your mind: The situation it addresses should never again arise.”

But let’s assume for a moment that a situation could arise, since that’s the basis of a new U.S. Supreme Court precedent (and dissents, while useful, are not binding precedent). Assume that, instead of Symczyk rejecting the settlement, she had accepted a settlement at the paltry price of $7,500, intending to resolve her own claim but not the claims of others. Or perhaps more likely, assume that another court, guided by the majority opinion’s silence and not the dissent, disagrees with Justice Kagan and decides that a rejected offer can moot an entire collective case. If courts interpret this to mean that all other workers no longer have a claim, corporations can dispense with every collective action against them simply by buying off just one worker at an astronomically lower price than litigating or settling with all the workers. And it’s possible courts could also apply this to the other mechanism that enables plaintiffs to band together, the class action.

The irony here is that collective and class action mechanisms exist because it costs too much and is too inefficient for any one consumer or worker to challenge a company-wide policy. So individuals can’t challenge a policy alone, but corporations can dispense with their collective lawsuit, by resolving the claim with just one person. Another example of the Roberts Court’s brand of access to justice.