Wal-Mart Stores, Inc. v. Dukes

(United States Supreme Court)

• Opposing Certification of a Class Based on Potentially Unreliable Expert Testimony

This is a class-action sex-discrimination lawsuit brought against Wal-Mart alleging discriminatory employment practices by Wal-Mart with respect to its female employees.  At issue in this Supreme Court appeal is Wal-Mart’s challenge to the California federal district court’s certification of a plaintiff class consisting of approximately 1.5 million women employed by Wal-Mart at the 3,400 stores operated by Wal-Mart throughout the United States. Despite the fact that most of the decision-making called into question by the plaintiffs takes place at the store level and involves the discretion of local managers and supervisors acting largely on the basis of local, individualized factors, the Ninth Circuit, in a sharply divided en banc decision, upheld the district court’s certification order, although it reduced the size of the class to approximately 500,000.   The Supreme Court granted Wal-Mart’s petition for certiorari to determine two questions: whether the certification is consistent the requirements of Fed. R. Civ. P. 23(a) (i.e., whether the California courts erred in finding sufficient commonality amongst the putative class members to warrant certification under Fed.R.Civ.P. 23(a)(2)) and whether the monetary awards sought by the plaintiffs preclude the action from being brought under Fed. R. Civ. P. 23(b)(2), which explicitly provides only for declaratory and injunctive relief.  In support of Wal-Mart, NELF has filed jointly with co-amicus Atlantic Legal Foundation (“ALF”) an amicus brief that addresses the first question, focusing on the district court’s refusal to entertain Wal-Mart’s Daubert objection to the testimony of an expert that plaintiffs proffered to show commonality.  The district court, which relied on the contested testimony in issuing its certification order, ruled that because a Daubert inquiry might impinge on the merits and involve the court in a “battle of the experts,” it was not the proper standard for the reliability of expert testimony at the certification stage.  The Ninth Circuit failed to correct the district court’s ruling, viewing Wal-Mart’s motion as seeking the court’s evaluation of the ultimate persuasiveness of the expert’s testimony.  In their brief, NELF and ALF argue that Federal Rule of Evidence 702 and the Court’s holding in Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579 (1993) create a single standard for evaluating the reliability of expert testimony in federal courts and that use of the standard at the certification stage is no less important than at the trial stage—indeed, it would seem to be required by the Supreme Court’s mandate that, before certifying a class, courts must conduct a “rigorous analysis” of how plaintiffs propose to satisfy Rule 23(a)’s requirements.   In support of its argument, NELF and ALF cite decisions of numerous circuit courts holding that, for the purpose of this “rigorous analysis,” a trial court’s Rule 23 inquiry may permissibly, and sometimes must, overlap merits issues.  The amici emphasize that failure to apply rigorous standards, like that provided by Daubert, to Rule 23(a) determinations means that more classes will likely be certified erroneously, increasing the likelihood that defendants will be confronted with meritless class actions.  In such situations business defendants would be unfairly faced with a harsh choice between hazarding trial, with the attendant risk of huge money judgments, or settling for large sums despite the weakness of the class claims.