A class-action lawsuit alleging sex-discrimination against Wal-Mart was dismissed by the Supreme Court today, with lawyers saying the ruling narrows substantively the grounds on which class action status can be sought, whatever the issue.
The ruling that the lawsuit was too broad to be classified as a class action was unanimous.
But, the court split, 5-4, along conservative-liberal lines, on the issue of whether the case could be narrowed to remain a class action for 1.5 million women employees of the company.
The case is Wal-Mart v. Dukes, No. 10-27.
It deals with the decision both by a lower court and the entire 9th Circuit Court of Appeals to certify as a class “all women employed by Wal-Mart at any time after Dec. 26, 1998.”
The suit alleges that Wal-Mart, as a policy pays women less, gives them fewer promotions and that these promotions take longer to obtain.
Lawyers for Seyfarth Shaw, a New York law firm, said after the decision, “In workplace law circles, today is “D-Day.”
“Today’s ruling confirms what we predicted: Dukes creates a new landscape for Rule 23 certification issues, and is apt to impact employment discrimination litigation for years to come,” Seyfarth Shaw lawyers Gerald Maatman Jr. and Laura Lamechtlen said.
They said that the opinion, authored by Justice Antonin Scalia, addresses two primary questions: (1) whether the order certifying a class conforms to the requirements of Federal Rule of Civil Procedure 23(a); and (2) whether claims for monetary relief can be certified under Federal Rule of Civil Procedure 23(b)(2) and, if so, under what circumstances.
In the opinion, Scalia said that, “The workers “provide no convincing proof of a companywide discriminatory pay and promotion policy.”
But Justice Ruth Bader Ginsburg, writing on behalf of the court’s liberal wing, said the court would have returned the case to a lower court and let the workers try to press ahead with a class action under a different legal theory.
Maatman and Lamechtlen, said the decision “is likely to spark a transformation of Rule 23 class certification law, and the workplace class action litigation is apt to change dramatically in the future.’
“In short, the Supreme Court’s opinion re-positions the goal posts on the playing fields of how workplace class actions are structured, defended, and litigated,” they said.
They said that in the majority ruling, the Supreme Court held that the plaintiffs failed to demonstrate commonality under Rule 23(a)(2), and unanimously held that the back pay claims could not be properly certified under Rule 23(b)(2).
“The impact of the ruling will be significant to employers for their approach to employment discrimination litigation,” Maatman and Lamechtlen said.
As such, Dukes determines how much, for purposes of Rule 23(a), class members must have in common for a class action to be certified and the extent to which claims for money damages can ever be certified under Rule 23(b)(2).
Robin Conrad, executive vice president of the U.S. Chamber of Commerce’s National Chamber Litigation Center, was equally emphatic.
“This is without a doubt the most important class action case in more than a decade,” she said.
“We applaud the Supreme Court for affirming that mega-class actions such as this one are completely inconsistent with federal law,” she said.
“Every single Supreme Court justice disagreed with the Ninth Circuit’s decision, which radically lowered the standard for certifying class actions, and opened the door to even more bet-the-business blockbuster class actions,” Conrad said.