The Wal-Mart discrimination class action, involving allegations that the mega-corporation systematically discriminates against female employees, is drawing attention from advocates for laborers and corporations alike.
The Ninth Circuit Court of Appeals certified the case as a class action in August, rejecting Wal-Mart's argument that the massive number of people involved -- the class could potentially encompass over one million employees -- renders the case unmanageable.
Late last month, Wal-Mart asked the Supreme Court to hear the case, contending that the appeals court's decision contradicts numerous decisions of other appellate courts and even the Supreme Court itself.
Because of its potential precedential value -- the case is the largest employment class action ever certified, and could open the proverbial floodgates for similar actions -- the suit is drawing attention from both sides of the aisle.
The U.S. Chamber of Commerce, the nation's primary lobbying group for businesses, is the latest to take sides. It has filed an amicus brief on Wal-Mart's behalf, urging the high court to hear the case.
This is the most important class action case facing the Court in over a decade, Robin Conrad, executive vice president of the Chamber's Litigation Center, said in a statement. The Ninth Circuit radically lowered the standards for certifying blockbuster class actions. Unless the Court steps in to undo the mess created by the Ninth Circuit, the West Coast will become a haven for bet-the-business class actions.
The brief, the sixth filed by the Chamber since the case was first certified in 2004, says the narrowly divided Ninth Circuit's contentious 6-5 ruling essentially sanctions a loose approach to class certification that effectively [bars] Wal-Mart from presenting individualized evidence to prove it [has] complied with the law.
Corporations at risk
Conrad warned that the suit threatens the very existence of every corporation.
The Ninth Circuit has opened the door to nothing less than court-sanctioned shakedowns, Conrad said. By denying businesses their fundamental right to defend themselves in court, the Ninth Circuit leaves them with a harsh choice: either settle meritless lawsuits, or potentially face financial ruin.
Meanwhile, labor advocates contend that the suit is a crucial tool in their fight to provide fair working conditions.
Richard Seymour, an attorney who focuses on employment class action lawsuits, told USA Today that the situation is a no-win proposition for employers. According to Seymour, no matter what the outcome of the appeal, plaintiffs will have a better idea of how to get similar actions certified in the future.
Wal-Mart also has a friend in Judge Sandra Ikuta, who dissented from the Ninth Circuit's decision.
Never before has such a low bar been set for certifying such a gargantuan class, Ikuta wrote in her opinion. She said the plaintiffs' case was built on general and conclusory allegations, a handful of anecdotes and statistical disparities that bear little relation to the alleged discriminatory decisions. Ikuta's approach and precedent could provide a path for the Supreme Court if it decides to take the case and overturn the Ninth Circuit's opinion.
