Class Action Certification Procedure Scrutinized


In Wal-Mart Stores v. Dukes, No. 10-277, Atlantic Legal partnered with New England Legal Foundation in filing a brief in support of petitioners at the merits stage of what promises to be an important case establishing the test for certification of class actions in federal court. Our brief addressed one of the two questions the Supreme Court certified: Whether the class certification ordered under Federal Rule of Civil Procedure 23(b)(2) was consistent with Rule 23(a)?

The U.S. District Court for the Northern District of California certified a class of approximately 1.5 million female current and former employees of Wal-Mart, who worked in thousands of different Wal-Mart stores throughout the United States in different job titles and at different times and who claimed that they were discriminated against on the basis of sex in job promotions and job assignments, notwithstanding the fact that Wal-Mart gives regional, district and store managers substantial autonomy in making job assignments and in promoting employees. The putative class representatives claim that Wal-Mart has a company-wide policy that is vulnerable to gender stereotyping and discrimination, based largely on the testimony of their sociologist expert witness.

The district court dismissed defendants challenge to the admissibility of the experts testimony, ruling that a Daubert inquiry would intrude on merits issues in a manner supposedly prohibited at the class certification stage by Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974). The Ninth Circuit, although acknowledging that Eisen was no longer appropriate law in light of Gen. Tel. Co. of the Southwest v. Falcon (Falcon), 457 U.S. 147 (1982), nevertheless affirmed and modified the district court class certification, holding that Rule 23’s requirements were satisfied by applying a less demanding standard to evaluate the reliability, and hence admissibility, of the sociology experts testimony.

In our brief we argue that the experts testimony was not adequately scrutinized for reliability by the district court, despite Wal-Marts motion challenging the testimony under Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579 (1993), and that both the district court and the Ninth Circuit erred in failing to acknowledge that the Daubert standard applies to expert testimony proffered by plaintiffs to satisfy Rule 23’s class certification requirements. We further argued that Federal Rule of Evidence 702 and the Courts holding in Daubert create a single standard for evaluating the reliability of expert testimony, whether at trial or at the certification stage of a class action. Scrutiny of proffered expert testimony is no less important at the certification stage than at any other part of the litigation process. The failure to apply sufficiently rigorous standards in Rule 23(a) determinations conflicts with the Supreme Courts own jurisprudence, Gen. Tel. Co. of the Southwest v. Falcon, 457 U.S. 147 (1982), and increases the likelihood that classes will be certified improperly, increasing the likelihood that defendants will be required to litigate meritless class actions. In such situations, business defendants are faced with the choice between hazarding trial and possible liability for huge money judgments or settling for large sums despite the weakness of the plaintiffs class claims.

To view our brief, please click here.