Wal-Mart wins Supreme Court appeal in class-action lawsuit (Updated)

The U.S. Supreme Court was unanimous in rejecting a bid to further the sex discrimination lawsuit against Wal-Mart Stores Inc.

The decision, issued Monday, is a setback for a class-action process that would have been the largest of its kind.

The gender discrimination claim alleges Wal-Mart failed to promote and pay women as equally as men. Initial estimates had the per claim payout ranging between $500,000 and $1 million, meaning a possible monetary claim could reach the hundreds of billions.

On April 26, the Ninth Circuit of Appeals (California) voted 6-5 to allow the Dukes case to move forward that originally included more than 1.5 million current and former female employees. However, the decision by the Ninth Circuit potentially reduced the class size by up to two-thirds, and it also set aside the ruling on punitive damages.

Writing for the unanimous court, Justice Antonin Scalia essentially noted that the format of the filing was not in keeping with civil procedures and reversed the ruling of the Ninth Circuit Court of Appeals.

However, the judges were split 5-4 on the ability of such a large class to be considered for the purpose of discrimination.

“Other than the bare existence of delegated discretion, respondents have identified no ‘specific employment practice’ — much less one that ties all their 1.5 million claims together,” Scalia wrote in the majority opinion. “Merely showing that Wal-Mart’s policy of discretion has produced an overall sex-based disparity does not suffice.”

Wal-Mart provided this statement following the ruling: “We are pleased with today’s ruling and believe the Court made the right decision. Walmart has had strong policies against discrimination for many years. The Court today unanimously rejected class certification and, as the majority made clear, the plaintiffs’ claims were worlds away from showing a companywide discriminatory pay and promotion policy.”

Writing for the minority opinion, Justice Ruth Bader Ginsburg said a uniform policy may create cause for uniform discrimination.

“Wal-Mart’s delegation of discretion over pay and promotions is a policy uniform throughout all stores. The very nature of discretion is that people will exercise it in various ways. A system of delegated discretion, Watson held, is a practice actionable under Title VII when it produces discriminatory outcomes,” Ginsburg noted.

Link here for the Court ruling (PDF).