ECONOMY

Wal-Mart Makes Case to Supreme Court to Derail Women's Suit

The biggest U.S. retailer takes issue with size of class action in sex-discrimination case; during questioning, some justices seem to agree.

Tuesday, March 29, 2011 | 3:19 p.m.
Alex Wong/Getty Images

Betty Dukes, one of the lead plaintiffs in a gender-discrimination suit against Wal-Mart, spoke to reporters after the Supreme Court heard Wal-Mart's case to deny certification of the class action.

It would be a neat story line if the Supreme Court justices aligned by gender when considering a case dealing with gender discrimination. The questions from the nine justices during Tuesday’s arguments suggested that just might be the case.

On Tuesday, the Supreme Court heard arguments in Wal-Mart Stores Inc. v. Dukes. At issue wasn't whether the nation's largest retailer was guilty of sex discrimination per se, but whether female employees will be allowed to sue Wal-Mart en masse in a giant class action that could encompass millions of plaintiffs. While one can never predict Supreme Court rulings, the likely answer is no.

Justices Ruth Bader Ginsberg, Elena Kagan, and Sonia Sotomayor -- all appointed by Democratic presidents -- led the questioning of Wal-Mart attorney Theodore Boutrous on Tuesday, picking at his argument that the women attempting to sue the largest private employer in the country lacked the cohesion necessary for a class action.

“It’s not fair to anyone to put this all into one big class,” Boutrous said. He argued that Wal-Mart would not be able to adequately defend itself against charges of discrimination because the nature of each case is so different. Some plaintiffs, he argued, were either not promoted or were demoted because of disciplinary action taken against them.

Justice Antonin Scalia seemed to agree. “Is this really due process?” he asked in a skeptical tone.

When it came time to question Joseph Sellers, the Washington attorney arguing on behalf of the women, Scalia and Justice Anthony Kennedy laid into his argument that Wal-Mart promulgated a culture of discrimination.

As an example of the corporate culture, Sellers cited the fact that the company told managers who were in training that women were not promoted as often as men because men were more aggressive. The managers would hear that answer and “apply a stereotype” in their decision-making, Sellers argued.

“To me, that’s just an assessment of why the percentage [of male and female mangers] is different,” Scalia said.

“I’m just not sure what the unlawful policy is,” Kennedy echoed.

Kennedy also said that Sellers was trying to argue “in two directions.”

“You said this is a culture where [headquarters] knows everything that’s going on. Then in the next breath you say, well, now these supervisors have too much discretion,” said Kennedy.

The heart of the case -- and the soundest legal argument the Court has for overturning it -- lies in Wal-Mart’s argument that the 9th Circuit Court of Appeals, which ruled against the retailer, modified the definitions used in determining what type of class the women would bring, said Northwestern University Law Professor Martin Redish, who has written extensively on class-action suits.

The appellate court made the unusual decision of tweaking the definition of so-called 23(b)(2) class to allow the women to proceed with their suit, a break with precedent that the Supreme Court, at least for the moment, seems unlikely to uphold.

“The 9th Circuit does get reversed a fair bit,” Redish noted of previous Supreme Court rulings.

The list of amicus briefs filed with The Court made the high stakes of the decision clear: Costco Wholesale Corp., the Altria Group, Intel, and the U.S. Chamber of Commerce all lined up in support of Wal-Mart; civil-liberties and employment-law associations backed the workers.

“This Supreme Court is known as being a very pro-business court,” Redish said. “I think in a lot of those decisions, the legal arguments happen to favor the business. I would be shocked if they uphold this class.”

While workers-rights groups have argued that throwing out the class will be a huge blow to their cause, Redish argues that allowing it to proceed would be bad for the future of due process.

Big Business agrees with him, arguing that allowing the class to move forward despite – in their view – the questions of coherence among the members, it could unleash scores of expensive lawsuits across the country.

The Court is expected to rule in June. 

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