A divided Ninth Circuit Court of Appeals recently upheld the Northern District of California’s certification of a nationwide class of over 1.5 million current and former female employees who sued for alleged gender discrimination under Title VII of the Civil Rights Act of 1964. Dukes v. Wal-Mart Stores, Inc., 603 F. 3d 571 (9th. Cir. 2010) (en banc). The “commonality” factor of FRCP 23(a) was central to the case; that there are issues of law or fact common to all class members. The district court certified the class, finding that Plaintiffs exceeded the permissive and minimal burden of establishing ‘commonality’ by demonstrating: (1) significant evidence of company-wide corporate practices and policies, which included (a) excessive subjectivity in personnel decisions, (b) gender stereotyping, and (c) maintenance of a strong corporate culture; (2) statistical evidence of gender disparities caused by discrimination; and (3) anecdotal evidence of gender bias. The trial court dispensed with the substantive requirements of Title VII necessitating individualized proof of discrimination, solely to make the class manageable. Some have posited that the Dukes holding, if affirmed or simply left to stand by the U. S. Supreme Court by a denial of certiorari, denies Wal-Mart due process of law; essentially, the requirement that a plaintiff prove her individual case as required by the substantive law at issue, and the concomitant fundamental right to present a defense to it. (See DRI Today, Fahleson post 9-29-10.)
In Dukes, the trial court discarded Wal-Mart’s individual defenses to the plaintiffs’ claims, thereby allowing the class to proceed in the face of myriad individual proof of causation and injury questions that typically obviate class certification. For example, Wal-Mart should be entitled to show that it paid a particular plaintiff a lower wage because she was less willing to work weekends or rotating shifts, not because she was female. Instead, the court found “commonality” among the proposed class members based upon “company-wide corporate practices and policies” and held that Wal-Mart was not “entitled to circumvent or defeat the class nature of the proceeding by litigating whether every individual store discriminated against individual class members.” The lower court went on to propose a formula-based approach to determine individual plaintiffs’ relief without considering Wal-Mart’s defense to their claims.
If left to stand, the impact of the Ninth Circuit’s class certification decision will not be limited to employment discrimination suits. It will also affect plaintiffs’ bids to obtain class certification in many other contexts, notably in products liability and toxic tort cases. Particularly in these areas, a plaintiff’s case inherently requires proof that a defendant’s conduct in fact caused injury. Castano v. Am. Tobacco Co., 84 F.3d 734, 740 (5th Cir. 1996); Amchem Prods., Inc. v. Windsor, 521 U. S. 591, 620; FRCP 23(a). The defense necessarily relies upon its ability to dispute individual causation and injury, especially in contexts of “mature” torts where general causation may have been adjudicated, but specific causation proof requirements remain central to a defense. Dukes would eviscerate product liability and toxic tort defendants’ ability to defeat class certification by pointing to individual issues overwhelming common issues.
The Dukes majority concluded that due process was satisfied, even without individualized hearings, by limiting back pay awards to individuals whose back pay could be easily calculated from Wal-Mart’s extensive salary database. Such reasoning has the potential to turn class action law – in the context of product liability and toxic tort cases – on its head. If the approach of Dukes is left to stand, a defendant’s matrix of injuries and other elements of individual claims – often used for consolidating data and resolving claims in “mature” mass torts such as asbestos – could be sufficient evidence for damages, insofar as individualized proof of causation and injury would be unnecessary.
Although certification of a 1.5 million person class was in and of itself historic, the breadth of the court’s ruling has consequences far greater than a listing in the Guinness Book of World Records.