Tuesday, June 21, 2011

Court denies women class action against Wal-Mart

Washington – In a ruling that will affect class action suits of all types, the U.S. Supreme Court denied class action status in a sex discrimination suit against the nation's largest private employer, Wal-Mart.

The ruling holds that neither scientific, nor anecdotal evidence about a corporation's culture is a valid basis for admitting a type of plaintiff to the status of a class in federal suits seeking money damages, according to a 5 to 4 decision handed down on Monday.

The Court did not rule that gender bias alleged in the federal complaint does not exist, only that the plaintiffs could not seek money or other compensation for damages as a class based on their gender.

The lawsuit will be allowed to continue on the basis of individual complaints alleging gender bias.

Millions of women sought billions of dollars in damages based on a complaint in which sociology Professor William T. Bielby testified before a lower Court that the company's system of employment practices constituted an observable corporate culture of gender bias against females as a distinct class.

Relying upon corporate records discovered by attorneys for the plaintiff class and presenting through his testimony “scientific evidence about gender bias, stereotypes and the structure and dynamics of gender inequality in organizations,” the professor concluded that the corporation's culture is biased in a way which fosters disparate pay and promotion practices through subjective decisions made by local managers.

In the majority opinion of the 5 most conservative members of the Court, Justice Antonin Scalia held that Wal-Mart's system of making employment decisions is “a policy against having uniform employment practices.”

All 9 justices agreed unanimously that the plaintiffs had erred in seeking class action under a part of the federal rules of civil procedure that is not concerned primarily with monetary claims.

Justice Scalia observed that the corporation operates 3,400 stores, has a policy which forbids discrimination, and grants local managers substantial discretion.

“On its face, of course, that is just the opposite of a uniform employment practice that would provide the commonality needed for a class action...”

As a result, plaintiffs seeking to have federal civil suits admitted to class status will in the future be required to show more concrete evidence of bias against the class under the specific rule which applies directly to monetary discrimination.

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