Wal-Mart Settles Sex Bias Claims, but Class Action Refiled

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By Kevin McGowan

July 18 — Five female Wal-Mart Stores Inc. employees who filed the sex discrimination class action that led to a landmark U.S. Supreme Court ruling formally dismissed their individual bias claims after reaching private settlements with the retail giant, the parties said in a document filed in federal district court in California ( Dukes v. Wal-Mart Stores, Inc., N.D. Cal., No. 01-2252, voluntary dismissal filed 7/15/16 ).

The named plaintiffs in the original Wal-Mart class action, filed in 2001, reached confidential settlements with the company and stipulated to dismissal of their claims, the parties said in a July 15 court filing.

But six other former Wal-Mart employees July 14 filed a new class complaint alleging the company discriminated against women in pay and promotions in three corporate regions based in California. Those women, also members of the original class in Dukes v. Wal-Mart Stores Inc., are asking the U.S. District Court for the Northern District of California to certify a class of female employees who worked in those regions anytime from Dec. 26, 1998, until at least June 2004.

If the district court grants their motion to intervene, the new named plaintiffs would appeal the court's earlier denial of class certification to the U.S. Court of Appeals for the Ninth Circuit, said Joseph Sellers, an attorney representing the former employees.

The district court in August 2013 denied certification of a proposed regional class of about 150,000 female former and current employees in about 200 Wal-Mart and Sam's Club locations in California (964 F.Supp. 2d 1115, 119 FEP Cases 730 (N.D. Cal. 2013)).

“This matter has been determined and we don't believe jurisdiction exists to hear the intervenors' claims,” Wal-Mart spokesman Randy Hargrove told Bloomberg BNA July 18.

Regional Suits Followed High Court Ruling

The Supreme Court in 2011 vacated a nationwide class action against Wal-Mart that would have covered more than 1 million female current and former employees challenging hundreds of thousands of employment decisions (564 U.S. 338, 112 FEP Cases 769 (2011)).

The Dukes plaintiffs couldn't show a common question of law or fact uniting their claims under Rule 23(a) of the Federal Rules of Civil Procedure, the Supreme Court said in what quickly became a leading precedent in class action jurisprudence.

The Dukes plaintiffs after the Supreme Court ruling filed a new class complaint, alleging Wal-Mart managers in the retailer's California regions systematically discriminated against female employees.

Four other class actions were filed in federal district courts across the country, alleging systemic sex discrimination by Wal-Mart managers and supervisors in other corporate regions.

No district court yet has certified class treatment of a regional sex discrimination lawsuit filed against Wal-Mart after Dukes.

Ninth Circuit Review Desired

The intervenors' complaint provides a potential path for the Ninth Circuit to review Judge Charles Breyer's 2013 denial of class certification in the California regional lawsuit, Sellers told Bloomberg BNA July 18.

Breyer had denied Wal-Mart's earlier motion to dismiss the regional class complaint, meaning he found the complaint legally sufficient, said Sellers, a partner with Cohen Milstein Sellers & Toll in Washington.

But Breyer in denying class certification misinterpreted some aspects of the Supreme Court's ruling in Dukes, Sellers said.

The regional complaints address the shortcomings enumerated by the Supreme Court by identifying specific Wal-Mart practices implemented by named managers causing discriminatory effects at the regional, district and store levels, he said.

The U.S. Court of Appeals for the Sixth Circuit in 2015 reversed a district court's dismissal of regional class claims on procedural grounds in Phipps v. Wal-Mart Stores, Inc., 792 F.3d 637, 127 FEP Cases 945 (6th Cir. 2015). That case now is pending in a federal district in Tennessee, which currently is considering Wal-Mart's motion to dismiss on the merits, Sellers said.

The U.S. Court of Appeals for the Fifth Circuit reversed a district court's dismissal of named Wal-Mart plaintiff Stephanie Odle's individual sex bias claims Odle v. Wal-Mart Stores, Inc., 747 F.3d 532, 122 FEP Cases 532 (5th Cir. 2014). Odle and some other women in that regional lawsuit subsequently settled their individual claims with Wal-Mart, Sellers said.

A lawsuit in the U.S. District Court for the Southern District of Florida resulted in settlements between Wal-Mart and about 10 former employees on their individual bias claims, Sellers said. A separate group of women in that court has intervened to appeal the court's denial of class treatment, he said.

“Our hope is that Wal-Mart would show some interest in bringing all these cases to a close,” Sellers said.

In addition to Cohen Milstein, the Impact Fund, Hadsell Stormer & Renick LLP, Equal Rights Advocates, the Law Offices of Elizabeth A. Lawrence and the Law Office of Sheila Thomas represent the intervenor-plaintiffs in California. Gibson Dunn & Crutcher LLP represents Wal-Mart.

To contact the reporter on this story: Kevin McGowan in Washington at kmcgowan@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

For More Information

Text of the parties' joint settlement document is at http://www.bloomberglaw.com/public/document/Dukes_et_al_v_WalMart_Stores_Inc_Docket_No_301cv02252_ND_Cal_Jun_/2 and the plaintiff-intervenors' class complaint is at http://src.bna.com/gRB.

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