Labor & Employment Law

Gigantic Wal-Mart class action goes to en banc rehearing

The 9th Circuit yesterday granted a rehearing en banc in Dukes v. Wal-Mart (02/13/2008).

When this case was decided by a three-judge panel two years ago, this is what we said about it:

The 9th Circuit has approved a 1.5 million member class action in a Title VII case brought by current and former employees. Let the litigation begin.

The case: Dukes v. Wal-Mart (9th Cir 02/06/2007)

The capsule: Dukes and others sued claiming sex discrimination as to pay and managerial promotions in violation of Title VII. The trial court certified a class 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 class concerns approximately 1.5 million women who worked at any of Wal-Mart's 3,400 stores, including part-time, full-time, entry-level, hourly, salaried, managerial. The 9th Circuit affirmed (2-1), using a highly deferential "abuse of discretion" standard of review.

The class was certified under Rule 23(a) and (b)(2).

Rule 23(a): There was no dispute as to the numerosity requirement. As to common questions of fact and law, the court found that there was significant evidence of corporate-wide practices and policies of excessive subjectivity in personnel decision and sexual stereotyping, statistical evidence of gender disparities, and anecdotal evidence of gender bias. The court found the claims to be typical even though the only class representative for managers holds a low level position. The court found adequate representation even though there are in-store managers who are both class members and decision-making agents of the employer.

Rule 23(b)(2): In order to qualify under Rule 23(b)(2), plaintiffs' claims for injunctive and declaratory relief must predominate over their claims for monetary relief. The court rejected the employer's argument that monetary claims predominate, saying that this issue turned on "plaintiffs' intent in bringing the suit."

Individualized hearings: The employer argued that it was entitled to an individualized hearing for each member's claim, based on case law, Title VII, the Civil Rights Act of 1991, 42 USC Section 1991a, and the due process clause. The court rejected these arguments, noting that some of them can be raised at the merits stage.

The DISSENT argued that the class lacks commonality and typicality. In addition, if the named plaintiffs were zealously represented, then their interests would diverge and require separate counsel. Finally, the dissent argued that both the Civil Rights Act of 1991 and the due process clause "require more individual justice than Wal-Mart will receive."

Thanks to Shaw Valenza's What's New in Employment Law? for pointing this out.

Full post as published by Ross' Employment Law Blog on February 14, 2009 (boomark / email).