WAL-MART ESCAPES MASSIVE CLASS ACTION SEX DISCRIMINATION CASE

On June 20, 2011 the United States Supreme Court ruled in favor of Wal-Mart in one of the biggest class action lawsuits ever.  In Wal-Mart Stores, Inc. v. Dukes[1], the Supreme Court was faced with a class of about one and a half million plaintiffs, all current and former female employees of Wal-Mart who alleged the company discriminated against them on the basis of their sex by denying them equal pay or promotions, in violation of Title VII of the Civil Rights Act.

            The Ninth Circuit Court of Appeals had approved the certification of a plaintiff class consisting of “all women employed at any Wal-Mart domestic retail store at any time since December 26, 1998, who have been or may be subjected to Wal-Mart’s challenged pay and  management track promotions policies and practices.”  The Supreme Court ruling reversed this decision.  The crux of the case was commonality.  The plaintiff had to show that “questions of law or fact common to class members predominate over any questions affecting only individual members.”  It was plaintiff’s theory that Wal-Mart had a corporate culture that permitted bias against women.

            The Supreme Court found that there was not sufficient evidence that Wal-Mart operated under a general policy of discrimination. There was not sufficient commonality amongst the women in the class to warrant class action certification.  The women in the class held different jobs, for variable lengths of time, in 3,400 stores, in numerous states, with different supervisors.  “They have little in common but their sex and this lawsuit.”

            While any woman in the class is free to pursue an individual lawsuit, the absence of a class action lowers the stakes tremendously for Wal-Mart and reduces the pressure on them to settle.  Business leaders were also concerned that a decision against Wal-Mart would lead to a flood of these types of class action discrimination lawsuits.

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