Wal-Mart Asks Supreme Court to Hear Bias Suit

Wal-Mart Asks Supreme Court to Hear Bias Suit
By STEVEN GREENHOUSE
Copyright by The New York Times
Published: August 25, 2010
http://www.nytimes.com/2010/08/26/business/26walmart.html?th=&adxnnl=1&emc=th&adxnnlx=1282834847-i7p99sbksEw5CuyGA5nQhw


Wal-Mart Stores asked the Supreme Court on Wednesday to review the largest employment discrimination lawsuit in American history, involving more than a million female workers, current and former, at Wal-Mart and Sam’s Club stores.

Nine years after the suit was filed, the central issue before the Supreme Court will not be whether any discrimination occurred, but whether more than a million people can even make this joint claim through a class-action lawsuit, as opposed to filing claims individually or in smaller groups.

In April, the United States Court of Appeals for the Ninth Circuit in San Francisco ruled 6-5 that the lawsuit could proceed as a jumbo class action — the fourth judicial decision upholding a class action.

The stakes are huge. If the Supreme Court allows the suit to proceed as a class action, that could easily cost Wal-Mart $1 billion or more in damages, legal experts say.

More significant, the court’s ruling could set guidelines for other types of class-action suits. “This is the big one that will set the standards for all other class actions,” said Robin S. Conrad, executive vice president of the National Chamber Litigation Center, an arm of the United States Chamber of Commerce, which has filed several amicus briefs backing Wal-Mart.

Meanwhile, the women at the core of the original lawsuit, known as Dukes v. Wal-Mart, have tried to move on with their lives. Some still work at Wal-Mart and have been promoted or received raises. One still works as a greeter there. Others have left Wal-Mart.

The case began nearly a decade ago with one woman, Stephanie Odle, who was upset to discover that the top manager at the Sam’s Club where she worked as an assistant store manager had been administering a promotion test to the three male assistant store managers but not to her.

That came after Ms. Odle discovered that a male assistant manager at a previous Sam’s Club where she worked had been earning $23,000 more a year than she was. When she complained, she said, the district manager responded, “Stephanie, that assistant manager has a family and two children to support.”

“I told him, ‘I’m a single mother, and I have a 6-month-old child to support,’ ” she recalled in an interview.

Lawyers representing the plaintiffs recruited Ms. Odle after obtaining a data showing that just a third of Wal-Mart’s managers were women even though two-thirds of its employees were. The lawyers wanted to enlist a Wal-Mart employee whose complaints about pay and promotions would be a base from which to build a broader sex discrimination case.

Ms. Odle’s story, along with those of six other women, became the seed of the 2001 lawsuit that accused Wal-Mart of systematic discrimination against women in pay and promotions. No one expected it to become such a drawn-out battle.

In its appeal, Wal-Mart said the Ninth Circuit’s decision had contradicted earlier decisions of the Supreme Court and other appeals courts and had wrongly relieved the plaintiffs of the burden of proving individual injury.

“This conflict and confusion in class-action law is harmful for everyone — employers, employees, businesses of all types and sizes, and the civil justice system,” said Theodore Boutrous, a lawyer for Wal-Mart.

In its filing, Wal-Mart argued that while a class action might be appropriate for plaintiffs seeking changes to the retailer’s behavior, the status was improper for seeking monetary damages.

The company said the complaints of the seven women were not typical of the more than one million women who have worked at Wal-Mart in the last decade. In a statement Wednesday, Wal-Mart said that it “has been recognized as a leader in fostering the advancement and success of women in the workplace.”

Brad Seligman, a lawyer for the women, disputed Wal-Mart’s legal analysis. “The ruling upholding the class in this case is well within the mainstream that courts at all levels have recognized for decades,” he said in an e-mail Wednesday. “Only the size of the case is unusual, and that is a product of Wal-Mart’s size and the breadth of the discrimination we documented. There is no ‘too big to be liable’ exception in civil rights laws.”

The slow grind of the legal process has taken its toll on the plaintiffs.

Patricia Surgeson said she had quit Wal-Mart in frustration after being repeatedly denied a promotion and discovering that male employees at her store were typically paid more than women. She is now at home raising three children.

Cleo Page resigned from the Wal-Mart store in Union City, Calif., and became a teacher for disabled students. She said she had grown angry because she was never promoted to management trainee and because the store manager had only considered men to head the sporting goods department.

Ms. Odle, who said Sam’s Club had fired her because she kept speaking out against discrimination, moved to Old Navy and then to Aéropostale. At both, she said, managers threatened to fire her after discovering that she had appeared on television criticizing Wal-Mart.

Tired of worrying about dismissal, she went into business for herself. For the last five years, she has been selling country pecan pork chops and chicken and dumplings at Dishing It Up, her take-out meals shop in Norman, Okla.

“This way it’s better, because now no one can fire me,” Ms. Odle said.

Still, her customers frequently comment on her role in the lawsuit. “You have people who say, ‘You go, girl,’ and you have other people saying, ‘Oh, you’re that girl,’ ” she said. (Ms. Odle is no longer one of the named plaintiffs; that group is limited to California residents.)

David Tovar, a Wal-Mart spokesman, denied that there was any companywide discrimination, saying that conditions had steadily improved for female employees. He said 46 percent of Wal-Mart’s assistant store managers were women, a position that is a pipeline to higher positions.

Mr. Tovar pointed to a company-sponsored expert study indicating that in 90 percent of its stores, there were no statistically significant pay disparities between men and women. But the plaintiffs’ experts said they found sex discrimination in all 46 Wal-Mart regions.

Mr. Boutrous said that even if the seven lead plaintiffs had suffered discrimination, that did not mean there was across-the-board bias at thousands of stores nationwide. He said the women’s claims should be tried individually, or if a manager discriminated against a store’s 200 women employees, then perhaps as a 200-member class action for those women.

Joseph Sellers, a lawyer for the plaintiffs, said the case should be a class action because Wal-Mart had and still has a common set of personnel policies at all of its stores. “We regard them as cookie-cutter operations that are similar to each other,” he said.

The seven lead plaintiffs disagree on one important matter: whether Wal-Mart has improved its policies toward women.

Betty Dukes, the woman for whom the case is named, is not convinced that conditions are any better. She began working for Wal-Mart in Pittsburg, Calif., in 1994 and is still a greeter there. She said she had stayed because it was hard to find another job while in the spotlight.

Ms. Dukes originally complained that she had been repeatedly passed over for promotions and that management had not even posted openings. Moreover, she said, women were paid less than men for the same job. When the lawsuit was filed, she was earning $8.44 an hour, despite nine years of service.

When the news media began covering the lawsuit and writing about her, she said, Wal-Mart grew embarrassed and raised her pay by nearly 50 percent within a year. After 16 years at Wal-Mart, Ms. Dukes said she earns about $31,000 a year. “I’m still struggling to get by,” she said.

Another plaintiff, Deborah Gunter, grew upset that she had not been promoted to photo lab or pet department manager even though she said she had considerable experience with photography and pets.

She was later denied promotions to become a tire and lube manager, she said, adding that several men she had trained were promoted over her. Her boss then cut her hours back, reducing her pay, and when she complained about that, she was fired, she said.

Edith Arana is still fuming at Wal-Mart. During her six years there, she said, she had been repeatedly passed over for promotions even though she often worked grueling hours to impress management, frequently shortchanging her children.

“There are some women who are afraid to speak up,” said Ms. Arana, who now works at the Los Angeles Public Library. “Someone needs to speak up for them. I’m willing to take on the fight.”

Christine Kwapnoski sees signs that the suit has had an impact.

She complained that while working at the freezer department at a Sam’s Club in Concord, Calif., several men she had trained were promoted over her. Soon after the suit was filed, though, Sam’s promoted her to assistant store manager — she believes to make the company look better in court.

“The influx of women into management after the lawsuit was brought was phenomenal,” Ms. Kwapnoski said.

Ms. Odle also said opportunities for women had improved, even though the broader legal questions remained unresolved.

“We’ve already won because they already had to change their policies toward women because of us,” Ms. Odle said.