Dive Brief:

• The Supreme Court ruled 6-3 Wednesday that companies cannot stop a lawsuit (including class-actions) by offering full compensation to the original plaintiff, USA Today reports.
• Ryan Mick, a partner at the international law firm Dorsey & Whitney who has been following the case, told HR Dive in an email that the decision will have “significant” impact on companies, especially those facing class-action lawsuits.
• Such a case means that companies need to “identify and eliminate” compliance issues, even minor ones and especially those that could result in penalties and fines for individual violations, Mick said.

Dive Insight:

The original case is based on an “unsolicited text message” sent by a Navy recruiter that was accused of being a “violation of the Telephone Consumer Protection Act,” which protects cellphones from robocalls or mass messages, USA Today reports.

The main issue at hand was whether or not a company offering a settlement ends arbitration completely. The Supreme Court, in an opinion written by Ruth Bader Ginsburg, ruled that such an action did not end the case unless actually accepted by the original plaintiff.

“Cases in the near future are likely to address the avenue potentially left open by the Court by which defendant companies actually deposit the full amount of damages in an account payable to the plaintiff(s), even if the plaintiff(s) attempt to reject the offer,” Mick said.

At any rate, employers may have lost a way to “head off” large class-action cases, he added.