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Supreme Court to decide Wal-Mart and power plant cases

The justices will hear the retailer's appeal that one sex bias claim should not be able to represent 1.5 million women and will consider halting an environmental suit against coal-fired power plants.

December 07, 2010|By David G. Savage, Tribune Washington Bureau

Reporting from Washington — The Supreme Court announced Monday it would hear two major appeals from corporate America that seek to block mass lawsuits, one involving a huge sex bias claim against Wal-Mart and the other a massive environmental suit that aims to hold coal-fired power plants responsible for contributing to global warming.

In both cases, the justices agreed to consider stopping the suits before they could move toward a trial.

The move is only the latest sign that the court under Chief Justice John G. Roberts Jr. is inclined to rein in big-money lawsuits against businesses. The conservative justices have been particularly skeptical of sprawling suits that could run on for years and lead to enormous verdicts.

In the global warming case, industry lawyers played up this theme. They cited the mass litigation over asbestos and tobacco and said the climate change suits, unless halted, could make those "look like peanuts."

In the Wal-Mart case, the justices will decide whether the retail giant can be sued for sexual discrimination in the largest workplace class-action suit in the nation's history. A federal judge and the U.S. 9th Circuit Court of Appeals in San Francisco cleared the suit to proceed as a class action on behalf of as many as 1.5 million women who were employed at Wal-Mart in the last decade. The suit contends women were regularly paid less than men and denied promotions.

The justices will not decide whether Wal-Mart is guilty of bias. Instead, they will rule on whether a retailer must defend itself against a single lawsuit that speaks for more than a million employees.

Since 1966, the federal rules of civil procedures have allowed individual plaintiffs to sue as "representative" of a class of persons, but "only if there are questions of law or fact common to the class." The lawyers who sued Wal-Mart said the company had a common corporate culture that reserved most management jobs for men. Wal-Mart disagrees and argues that because hiring and promotions decisions are made by individual managers in its 3,400 stores, the employees do not have a common complaint.

The issue of when a suit can proceed as a class action is of great interest to corporate lawyers and the trial bar. If a suit gets the go-ahead to proceed as a class action, companies feel pressure to offer a settlement rather than risk a potentially crippling jury verdict.

The global warming suit, if allowed to proceed, could be even more significant. It will determine whether judges can rule that pollution is a public nuisance and on that basis set limits on carbon emissions. The case to be heard by the court concerns power plants in the Midwest and South, but similar nuisance suits have been filed against the auto, oil, coal and chemical industries, asserting they should be held liable for contributing to climate change.

Environmentalists and lawyers for several states, including New York, California and Connecticut, have backed the suits. They are frustrated by the slow pace of progress in Washington and say the courts must act. David Doniger, policy director at the Natural Resources Defense Council's Climate Center, said the justices should "keep the courthouse door open until the executive branch actually protects the American people" by curbing carbon emissions.

But lawyers for the Obama administration urged the high court to stop the global warming suit. They say addressing climate change is a "political question," not a legal one, and it should be resolved by Congress and the Environmental Protection Agency, not through courts and lawsuits.

The high court gave environmentalists a big win in 2007 when it ruled that greenhouse gases, like carbon dioxide, were air pollutants under the Clean Air Act and subject to federal regulation. That decision cleared the way for the EPA to issue new rules limiting carbon emissions, including from vehicles. But the agency has not set new limits for old power plants, and Congress has been unwilling to adopt a broad climate change bill.

The power plant lawsuit was described as "opening a new frontier" in the climate change fight when it began in 2004. Eight states, New York City and several environmental groups filed suit against four private power companies and one federally run public utility, which they described as the "five largest emitters of carbon dioxide in the United States." They won a preliminary victory last year when the U.S. Court of Appeals in New York cleared the suit to proceed.

In their appeal, lawyers for the power industry called the suit "breathtaking in scope" and "staggering" in its implications. It would allow a single judge to set nationwide rules for carbon emissions, they said. Justice Sonia Sotomayor said she would step aside because she heard the case when it first came to the appeals court in Manhattan.

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