Decisions That Consider Scope of Walmart v. Dukes

A recent decision from the  Third Circuit Court of Appeals has given class-action plaintiffs some helpful guidance in addressing the Supreme Court’s  decision in Walmart Stores Inc. v. Dukes.

In  Dukes, the Supreme Court held that female Walmart employees could not bring a nationwide class-action suit against the retailer for alleged gender discrimination because they could not show that their claims arose from a single discriminatory policy or action.

On December 20, the Third Circuit Court of Appeals interpreted Dukes as permitting certification of two classes in a case against diamond producer De Beers, in Sullivan v. DB Investments. Plaintiffs, who included both direct and indirect purchasers of diamonds, alleged that De Beers engaged in anticompetitive practices in violation of both state and federal laws.

In a lengthy dissent, Judge Jordan argued that Dukes prevented certification of the class of indirect purchasers because some of its members came from states whose laws would preclude their claims. Jordan argued that because “some class members lack a claim” as a matter of law, the class could not be certified under Rule 23 of the Federal Rules of Civil Procedure and the federal Rules Enabling Act. In Jordan’s view, Dukes should be read to require a showing that class members had a common, cognizable claim, in addition to a showing that defendants’ conduct applied to all members.

The Sullivan majority rejected this argument, stating that Dukes did not hold “that an inquiry into the existence or validity of each class member’s claim is required at the class certification stage.” Rather, the inquiry should be limited to whether the plaintiffs’ claims arose from the same conduct or policy. The majority stated that “Dukes actually bolsters our position, making clear that the focus is on whether the defendant’s conduct was common as to all of the class members, not on whether each plaintiff has a ‘colorable’ claim.”

A similar outcome was reached in Espinoza v. 953 Associates, which this blog reported on in December. There, the District Court for the Southern District of New York found that Dukes did not preclude class-action certification for restaurant employees seeking the return of withheld wages. Judge Scheindlin noted that plaintiffs had successfully alleged a common injury caused by the same policies and practices. Moreover, questions about individual claims spoke to differences in damages—not defendants’ liability—an issue that went beyond the scope of the Dukes holding.

The Dukes decision has made it more difficult for plaintiffs to receive certification for some class-action claims. However, as cases such as Sullivan and Espinoza show, plaintiffs may prevail at the certification stage by showing that defendants’ conduct and policies were common to all of the class members.

Nicholas Turner is a third year law student at New York Law School.  He is a Notes & Comments editor of Law Review and a John Marshall Harlan Scholar.  Mr. Turner came in second in the 2011 ABA Torts, Insurance, and Compensation Law Section Writing contest.  He was a 2011 Review Editor of the school’s Global Human Rights Bulletin.  Mr. Turner is proficient in French.

Abbey Spanier, LLP, located in New York City, is a well-recognized national class action and complex litigation law firm.