Ouch! Supreme Court Wal-Mart Decision Is a Blow to Plaintiffs

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Class action litigation has taken one on the chin, as the U.S. Supreme Court issued its decision Monday in Wal-Mart v. Dukes, a much-watched sex discrimination case brought under Title VII of the Civil Rights Act of 1964. In essence, the Court affirmed that members of a putative class must have enough in common with each other that it makes sense to treat them as “one” for purposes of the litigation. The Court also said that individualized claims for relief, including monetary damages and injunctions, must proceed under rules that allow putative class members to “opt out” and that provide procedural safeguards for defendants.

In all, the decision appears to be a very good one for employers. It will henceforth be more difficult for plaintiffs to bring class claims, significantly reducing the “leverage” that they have traditionally been able to exert, often pressuring employers to agree to large settlements to avoid financial devastation.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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