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Supreme Court case involving Wal-Mart could help determine how big one lawsuit can get

The U.S. Supreme Court will decide if a single job-bias lawsuit against Wal-Mart can proceed as a nationwide class-action claim.

March 23, 2011|By David G. Savage, Los Angeles Times
  • A Wal-Mart store in Eagan, Minn. The Supreme Court will decide whether a single lawsuit against Wal-Mart that accuses the company of gender bias can be turned into a nationwide class-action claim, which potentially could be the largest job discrimination case in U.S. history.
A Wal-Mart store in Eagan, Minn. The Supreme Court will decide whether a… (Glen Stubbe / Minneapolis…)

Reporting from Berkeley — Brad Seligman is a determined civil rights lawyer with a small office and a powerful idea for turning a single lawsuit into a nationwide class action claim against America's largest employer.

Armed with stories from several women who said they were passed over for promotions at Wal-Mart Stores Inc., Seligman is at the helm of what could be the largest job-discrimination case in U.S. history, affecting as many as two million women and putting at risk tens of billions of dollars of the company's money.

This U.S. Supreme Court case, a decade in the making, has been described as the battle of Berkeley versus Bentonville, in which crusading liberal lawyers take on the conservative, male-dominated culture of the Arkansas-based retail giant.

The court's ruling could be the most far-reaching decision on job bias in more than a decade, according to experts on both sides. A win for Seligman's clients could open the door for the broader use of statistics to prove job discrimination — and not just on behalf of women, but also for minorities or persons with disabilities.

However, a win for Wal-Mart could deal a death blow to nationwide job-bias suits by ruling that employees who work in different stores and hold different jobs do not have enough in common to be a class.

U.S. 9th Circuit Court of Appeals Chief Judge Alex Kozinski, in a dissent to a ruling for the workers last year, said the million-plus women who have worked at Wal-Mart "have little in common but their sex and this lawsuit."

But proving a single worker was a victim of illegal discrimination is slow, hard and costly. In its defense, the employer can often point to good reasons for promoting one person over another.

In a class action, by contrast, the numbers can speak for themselves — and they do so loudly. Given a computer and a court order, a statistician can paint a damning portrait of a company.

"To prove these cases, you rely on statistics. And now all the records are electronic. It's all there at a keystroke," said Seligman, who works in a tiny office in the Berkeley marina with one other senior lawyer.

A statistician hired by Seligman found that at Wal-Mart, women make up about two-thirds of the hourly employees but fewer than 14% of store managers. And in nearly every job category, women earned less than men, even though they had, on average, more seniority.

"Women are treated as second-class employees at Wal-Marts from Florida to Alaska," Seligman said.

But Wal-Mart's lawyers sharply dispute the statistics cited by Seligman. They said there is no pay difference between men and women at 90% of stores. And decisions about who is hired or promoted are made locally, they said, not because of a companywide policy.

Los Angeles lawyer Theodore J. Boutrous Jr., who represents Wal-Mart, said Seligman is trying to create a new theory of class actions based on "structural discrimination."

He said Seligman cannot prove that the female plaintiffs suffered true discrimination, but he nonetheless hopes to win back pay for a million women by claiming that Wal-Mart's "corporate culture" fostered companywide discrimination.

"They went way too far," Boutrous said.

Rather than rebut the statistics before a jury, the company has fought fiercely to defeat class action status for the suit before the case can go to trial. So far, Seligman has been winning — but only before judges in San Francisco.

In 2004, a federal district judge there ruled the suit could proceed as a class action. The often liberal-leaning 9th Circuit agreed by a 2-1 vote in 2007 and again in a 6-5 decision last April.

But the more conservative U.S. Supreme Court, which has mostly frowned upon sprawling lawsuits against companies, will hear Wal-Mart's appeal Tuesday. And legal experts said the home-court advantage has shifted in the company's favor.

"The court's majority has been hostile to class actions," Stanford Law Professor Deborah Hensler said.

For the first time in its history, however, the high court will have three women on the bench for a major sex discrimination case. They include Justice Ruth Bader Ginsburg, who began her career as a women's rights advocate.

In 1966, just two years after the Civil Rights Act outlawed job discrimination, the federal rules of civil procedure were changed to permit one person to sue on behalf of a class of persons with the same basic claim.

The 1970s saw a series of class-action suits brought on behalf of blacks and Latinos who were largely shut out of higher-paying jobs.

But in the 1980s, the Supreme Court tightened the rules. It said judges should conduct a "rigorous analysis" before approving a class-based claim of job discrimination. The opinion cast doubt on the idea that the experience of one employee can be truly typical of the experience of hundreds or thousands of others.

The case of Wal-Mart vs. Dukes could be said to have begun in 1994 when Betty Dukes began work as a cashier at a store in Pittsburg, Calif., where she clashed with a female supervisor. After several years, she complained she had been denied opportunities to advance, despite good performance reviews.

When Seligman launched his suit in 2001, he named Dukes as the lead plaintiff. As such, she became a representative for all of the women who worked for the retailer since then. In recent years, she has worked as a "greeter" at the Pittsburg store while the suit slowly worked its way up through the courts.

The company's lawyers point out the suit now speaks for more women than the combined total of active-duty personnel in the U.S. Army, Air Force, Marines, Navy and Coast Guard.

david.savage@latimes.com

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