US Supreme Court Unanimously Throws Out Class Action Suit Against WalMart

The AP reports on the unanimous ruling:

The U.S. Supreme Court sided with Walmart today, ruling that female employees can't sue the retail giant in a class action alleging wage discrimination.

The Ninth U.S. Circuit Court of Appeals ruled in April 2010 that the employees could sue, which left Walmart open to $1.6 billion in damages, the AP reports. The Supreme Court said lawyers failed to identify a corporate policy that resulted in thousands of women at Sam's Club and Walmart stores being paid less than their male peers.

A narrow 5-4 ruling on a companion issue is critically important to such class actions now coming to an end:

The justices divided 5-4 on another aspect of the ruling that could make it much harder to mount similar class-action discrimination lawsuits against large employers.

Justice Antonin Scalia’s opinion for the court’s conservative majority said there needs to be common elements tying together “literally millions of employment decisions at once.”

But Scalia said that in the lawsuit against the nation’s largest private employer, “That is entirely absent here.”

Justice Ruth Bader Ginsburg, writing for the court’s four liberal justices, said there was more than enough uniting the claims. “Wal-Mart’s delegation of discretion over pay and promotions is a policy uniform throughout all stores,” Ginsburg said.

• Justice Antonin Scalia wrote for the majority of the Supreme Court:
  

First, if the employer “used a biased testing procedure to evaluate both applicants for employment and incumbent employees, a class action on behalf of every applicant or employee who might have been prejudiced by the test clearly would satisfy the commonality and typicality requirements of Rule 23(a).” Id., at 159, n. 15. Second, “[s]ignificant proof that an employer operated under a general policy of discrimination conceivably could justify a class of both applicants and employees if the discrimination manifested itself in hiring and promotion practices in the same general fashion, such as through entirely subjective decision making processes.” Ibid. We think that statement precisely describes respondents’ burden in this case. The first manner of bridging the gap obviously has no application here; Wal-Mart has no testing procedure or other company wide evaluation method that can be charged with bias. The whole point of permitting discretionary decisionmaking is to avoid evaluating employees under a common standard...

Even if it established (as it does not) a pay or promotion pattern that differs from the nationwide figures or the regional figures in all of Wal-Mart’s 3,400 stores, that would still not demonstrate that commonality of issue exists. Some managers will claim that the availability of women, or qualified women, or interested women, in their stores’ area does not mirror the national or regional statistics. And almost all of them will claim to have been applying some sex-neutral, performance-based criteria—whose nature and effectswill differ from store to store. In the landmark case of ours which held that giving discretion to lower-level supervisors can be the basis of Title VII liability under a disparate-impact theory, the plurality opinion conditioned that holding on the corollary that merely proving that the discretionary system has produced a racial or sexual disparity is not enough. “[T]he plaintiff must begin by identifying the specific employment practice that is chal-lenged.” Watson, 487 U. S., at 994; accord, Wards Cove Packing Co. v. Atonio, 490 U. S. 642, 656 (1989) (approving that statement), superseded by statute on other grounds, 42 U. S. C. §2000e–2(k). That is all the more necessary when a class of plaintiffs is sought to be certified. Other than the bare existence of delegated discretion, respondents have identified no “specific employment practice”—much less one that ties all their 1.5 million claims together. Merely showing that Wal-Mart’s policy of discretion has produced an overall sex-based disparity does not suffice.

Respondents’ anecdotal evidence suffers from the same defects, and in addition is too weak to raise any inference that all the individual, discretionary personnel decisions are discriminatory.

Tweet