Federal Judiciary

Argument preview: Wal-Mart and workers? rights

By Lyle Denniston

On Tuesday, shortly after 10 a.m., the Supreme Court begins a one-hour oral argument on the biggest class-action lawsuit in decades, involving the job policies of the huge discount retailer, Wal-Mart Stores, Inc.  Arguing for the store chain in Wal-Mart Stores v. Dukes, et al.(10-277) will be Theodore J. Boutrous, Jr., of the Los Angeles office of Gibson, Dunn & Crutcher.  Arguing for the six women who work or did work for the company will be Joseph M. Sellers of the Washington, D.C., office of Cohen Milstein Hausfeld & Toll.

Background

It is a fact of life in a complex industrial society that lawsuits can grow very complex, very expensive, and wearying in their length.  It takes a particularly hardy, or well-heeled, individual who wants to sue in that environment to go it alone.  And, often, what one person can gain by suing is not enough to make it worthwhile  — for that person, or for the lawyers.  The answer that Congress, and the states, have provided: the “class-actionm” lawsuit, combining a group of indiiduals who share the same complaint, pursuing it en masse.

Like many legal process inventions, the class-action lawsuit has developed problems, especially the difficulty in figuring out who is in the group, whether what they claim is the same for all of them, whether there is a common remedy that would fit for each, and how to manage them when the facts may vary, persn by person.

But corporate America has a special complaint about the way it believes the class-action lawsuit has developed.  Such lawsuits, it is said, can be so threatening in their cost and potential consequences that companies will be driven to settle, even if they believe the claims lack merit and could not succeed, if only one individual had brought the case.

The complications of such a case, actual or potential, are such that it may race serious constitutional questions.  Justice Antonin Scalia, in an opinion he wrote on issuing a temporary order in a case last year, commented that “the extent to which class treatment may constitutionally reduce the normal requirements of due process is an important question.”  He suggested that there was “national concern over abuse of the class-action device.”

It almost goes without saying that the case is the most important test of the class-action device in the 44 years since Congress approved the modern version of the court rule governing such lawsuits in the national courts: Rule 23 of the Federal Rules of Civil Procedure.

The critics of the device thus have a huge stake in what may be the biggest class-action case ever; it almost certainly is the biggest such lawsuit ever in a civil rights case, and without question is the largest ever in a case over workplace rights.

Indeed, it involves the largest private employer in America — Wal-Mart Stores, the nation’s, and maybe the world’s, dominant retailer.  The chain is a colossus, no matter what measure is used: 3,400 stores, 41 separate regions, 53 retail departments, 170 job classifications — and 1 million workers.  It is a company with such market clout that it can actually dictate the kind of consumer goods that manufacturers produce for the entire American retail industry.

The class-action lawsuit it now faces (it hasn’t been tried yet) at one point involved perhaps 1.5 million women who previously worked for the company, or still do.  The total number, after an appeals court ruling modified the dimensions of the class, is in some dispute, but it probably is at least 500,000.

It almost goes without saying that it is the most important class-action case to reach the Justices in the 44 years since Congress approved the modern version of the court rule governing such lawsuits: Rule 43 of the Federal Rules of Civil Procedure.   The case very likely will produce interpretations of the two key sections of Rule 23 that will have impact beyond the Wal-Mart case itself.

Full post as published by SCOTUSBLOG on March 26, 2011 (boomark / email).