Divided 9th Circuit Court of Appeals Approves Largest Class Action in History

On April 26, 2010, in Dukes v. Wal-Mart Stores, Inc., a divided Ninth Circuit Court of Appeals decided 6-5 en banc to affirm the decision of the trial court to grant class certification in a discrimination lawsuit alleging Wal-Mart Stores discriminates against its women employees. The nationwide class is reputed by the Los Angeles Daily Journal to number upward of 1.6 million women employees, which would make the class the largest class in United States history.

In 2001, the Impact Fund, a Berkley, California based organization many plaintiff's attorneys donate money to, filed on behalf of Betty Dukes and other current or former employees of Wal-Mart a lawsuit alleging Wal-Mart discriminates against its women employees regarding promotions and pay practices in violation of Title VII of the Civil Rights Act of 1964.

The trial court later certified a class consisting of "all women employed by Wal-Mart at any time after December 26, 1998."

On Appeal, the Ninth Circuit Court of Appeals affirmed the trial court's grant of class certification but remanded to the trial court for further consideration the issue of whether to certify for class treatment the plaintiffs' claims for punitive damages and the issue of whether to certify an additional class or classes consisting of women who were no longer employed by Wal-Mart when the lawsuit was filed.

One of the key issues in any motion for class certification is whether common issues of law and fact predominate over individualized issues of law or fact. Based on our initial review of the decision, we think the following succinct dissent by Chief Judge Alex Kozinski is apt:

Maybe there'd be no difference between 500 employees and 500,000 employees if they all had similar jobs, worked at the same half-billion square foot store and were supervised by the same managers. But the half-million members of the majority's approved class held a multitude of jobs, at different levels of Wal-Mart's hierarchy, for variable lengths of time, in 3,400 stores, sprinkled across 50 states, with a kaleidoscope of supervisors (male and female), subject to a variety of regional policies that all differed depending on each class member's job, location and period of employment. Some thrived while others did poorly. They have little in common but their sex and this lawsuit.

We are continuing to analyze the lengthy 139 page opinion and will update this blog once we have completed our analysis.

In the meantime, given the stakes involved and the issues involved, we think it is a virtual certainty that Wal-Mart Stores will petition the United States Supreme Court for review of the 9th Circuit's decision. Although review by the Supreme Court is discretionary, we think the Supreme Court would very likely be interested in this case given the importance of the issues not only to Wal-Mart Stores and its employees but to numerous other large employers and their employees. Further, the 9th Circuit Court of Appeals is not only the largest of the Circuit Courts of Appeal; it also the most frequently reversed Circuit Court of Appeals.

Click here to download and to read the opinion.

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