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Catalina Yachts v. Pierce1/14/2005
mpletely. Although it nominally affects only those Magnuson-Moss claimants who decline reasonable settlement offers, the opinion's actual effects will extend much farther. As the opinion interprets Rule 68, it will regularly expose prospective Magnuson-Moss claimants to a predictable and substantial risk of sizable new litigation costs for defendants' post-offer fees. In practical terms, this will send a mixed message to all potential claimants - those with strong and weak claims alike: it will tell them that the Magnuson-Moss Act lets them file their claims freely; but at the same time it will put them on notice that they should be prepared to accept the first offer of judgment advanced, or face new litigation costs that might make their claims far less than worthless. Faced with a near-certain prospect of early and low offers, most consumers with potentially meritorious small-damages-claims will simply give up without bothering to file, concluding that the potentially high costs of securing a reasonable judgment are simply not worth the prohibitive risk.
In my view, then, the opinion's reading of Rule 68 conflicts with the Magnuson-Moss Act's primary goal and so runs aground on federal preemption. The need to avoid this conflict with federal law provides another good reason for interpreting Rule 68(b)(1) as precluding defendants from recovering post-offer fees unless Rule 82(a) would allow them an award as prevailing parties.
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