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Supreme Court Says Sorry, But WalMart Is Too Big To Sue

The US Supreme Court released some decisions today about climate change and Wal-Mart. While the court ruled on whether certification was improper on the damages claim, there was still dissent among the justices as to whether the underlying issues

Wal-Mart-Debate19nov05.jpg
The US Supreme Court released some decisions today about climate change and Wal-Mart. While the court ruled on whether certification was improper on the damages claim, there was still dissent among the justices as to whether the underlying issues were valid.

WalMart Employees

WalMart employees wanted the right to sue as a class for gender discrimination in the workplace. In a unanimous decision, the court ruled that the class, as currently defined, was too broad to proceed as a class action lawsuit.

NPR reported back in March:

Standing on the steps of the Supreme Court, Betty Dukes, the lead plaintiff, said Wal-Mart's appeal is an attempt to "keep us out of court so the facts will not be presented to the public at large or before a sitting jury."

Those facts, say the plaintiffs, show that when the case was filed 10 years ago, women held two-thirds of the lowest-level hourly jobs and only one-third of the management jobs; and that women were paid on average $1.16 less per hour than men in the same jobs, despite having more seniority and higher performance ratings.

Wal-Mart, however, hotly disputes those statistics, contending that there is no pay difference between men and women at 90 percent of its stores. And the company points to what it repeatedly calls its "strong policy" against discrimination.

Jezebel:

But Antonin Scalia's majority opinion lost four justices — former civil rights attorney Ruth Bader Ginsburg, plus Elena Kagan, Sonia Sotomayor, and Stephen Breyer — when he argued that there could be no class that was discriminated against because there was no written policy covering them all:

[...]

This is a novel trap: Because clearly individuals don't discriminate against a class of people — say, women who they think are less likely to be competent or committed — and nothing is on the books, systemic discrimination must not exist. Case closed!

Of course, Ginsburg and her Democratic-appointed colleagues saw it differently. In arguing that they would have sent the plaintiffs to a lower court and try the case under different rules, Ginsburg pointed out, "Women fill 70 percent of the hourly jobs in the retailer's stores but make up only 33 percent of management employees," and that "the plaintiffs' 'largely uncontested descriptive statistics' also show that women working in the company's stores 'are paid less than men in every region' and 'that the salary gap widens over time even for men and women hired into the same jobs at the same time." Those are a lot of individual decisions that have nothing to do with each other.

The Hill:

Supreme Court Justice Antonin Scalia, writing the court's opinion, acknowledged that the case represented one of the "most expansive" class action suits in history. However, the suit was dismissed because the court said it failed to prove gender discrimination was a widespread common policy of Wal-Mart

Those words "widespread common policy" are key. WalMart had a written policy assigning store managers with responsibility for deciding who should be put on a track to promotion within the company. As a result, the class, which included female employees of WalMart reaching back to 1968, was deemed to be too broad and overreaching when the decision rested with individual managers at individual stores.

In other words, even if there was an overall culture of gender discrimination within the company, written policy assigning decisions on the store level protected the company from scrutiny.

This decision doesn't mean WalMart can't be sued for gender discrimination. They can, but it would have to be undertaken on a store-by-store basis, rather than nationwide. That might prove to be cost-prohibitive for anyone wanting to undertake such an action, since litigating issues like this is costly with no guarantee there will be a beneficial outcome.

The message to national corporate employers: Wherever possible, set policy on a local store/division level, do it in writing, and you'll be protected from whatever culture of discrimination may exist within your ranks.

There was dissent, however. Justice Ginsberg said the court properly ruled that the court should not allow the class under one part of the rule, but that the case should be remanded to the district court for consideration under another part. The five conservative justices disagreed with that.

Whether the class the plaintiffs describe meets the specific requirements of Rule 23(b)(3) is not before the Court, and I would reserve that matter for consideration and decision on remand.1

The Court, however, disqualifies the class at the starting gate, holding that the plaintiffs cannot cross the “commonality” line set by Rule 23(a)(2).

In so ruling, the Court imports into the Rule 23(a) determination concerns properly addressed in a Rule 23(b)(3) assessment.

In English, what this means is that while there's the possibility that the lawsuit could have gone forward as a class action under a different set of rules, the court struck down the entire class as one that doesn't have enough common ties to bind it together, which undoes any standing under other rules.

You can read the entire ruling here.

Climate Change

The Court also rejected a climate change lawsuit against power companies:

But the Supreme Court, in an opinion delivered by Justice Ruth Bader Ginsburg, rejected an appeals court decision that would have allowed federal judges to effectively put limits on greenhouse gas emissions.

That responsibility, the Supreme Court said, should be left in the hands of the EPA.

“The critical point is that Congress delegated to EPA the decision whether and how to regulate carbon-dioxide emissions from power plants; the delegation displaces federal common law,” the decision states.

The ruling builds on a 2007 decision in Massachusetts v. EPA in which the Supreme Court said that greenhouse-gas emissions could be regulated under the Clean Air Act if EPA found they endanger public health and welfare. EPA later made such a finding and has begun phasing in a series of rules aimed at ratcheting down the emissions.

Can you imagine how loaded the courts would be with paid-for judges if these cases were litigated in court? Of course, now it remains to be seen how the EPA will proceed with enforcement when Congress has defunded them, but still, it's probably a better decision to leave it in their hands.

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