Many commentators correctly that the decision in Wal-Mart Stores, Inc. v. Dukes would be favorable to business interests. However, unlike the Court’s earlier decision in AT&T Mobility v. Concepcion, the decision does not necessarily threaten to sound a death knell for class actions or even a particular category of class actions. Instead, the decision merely clarifies the standards on which future class actions are to be evaluated in the federal courts, but it does so in a way that is likely to impact class actions in many areas of the law outside of the employment law context. Here are some of the key issues on which the opinion will undoubtedly be cited in the future, and some thoughts on the potential impact of the decision on each issue.
1) Standard of review – The majority’s decision clarifies a long-standing misconception about the ability of a federal court to consider questions relating to the merits of a case in the class certification phase. For more than 30 years, plaintiffs’ counsel and many courts have cited the Court’s opinion in Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974) as prohibiting any examination of the plaintiffs’ claims on the merits at the class certification phase. Consistent with the majority trend in the lower federal courts, the Supreme Court’s decision in Wal-Mart Stores, Inc. confirms that a court should consider and resolve any issues of fact that are necessary to determine whether one or more elements of Rule 23 are satisfied, regardless of whether those issues may overlap or be identical to one or more issues to be decided in ruling on the merits of the plaintiff’s claims.
2) Evaluation of Expert Testimony – The majority decision makes clear that it is appropriate for a federal court to conduct a Daubert analysis to consider the reliability and helpfulness of expert witness opinions at the class certification phase. It is no longer sufficient for a plaintiff to present expert testimony and then argue that the Court may find that testimony reliable at some later point in the proceedings. Again, in keeping with te trend among the federal circuit courts, the Court’s analysis in Wal-mart Stores, Inc. makes clear that the reliability and relevance of expert testimony proposed as “common proof” should be evaluated before granting class certification.
3) Use of Statistical Evidence in Support of Class Certification – The majority’s decision leaves open the possibility that statistical evidence might be used in establishing the existence of common proof in certain cases, but it sets a high standard for when proffered statistical evidence can be considered as adequate proof of the existence of “common issue.” Significantly, Part III of Justice Scalia’s opinion, which was joined by all 9 justices, disapproves of the “Trial by Formula” approach to class actions, in which a sample of claims is tried on the merits, and the results of that sample are then applied proportionally to the claims of the entire class.
4) Certification of Claims Seeking Monetary Relief Under FRCP 23(b)(2) – This is perhaps the most uncontroversial aspect of the opinion in that part of the unanimous holding of the Court. The Court’s holding is also straightforward, at least conceptually: claims for monetary relief may not be certified under FRCP 23(b)(2) unless they are merely incidental to injunctive or declaratory relief being requested on behalf of the class as a whole. However, the devil may be in the details, as future courts (especially outside the employment law context) will be left with the task of defining what monetary relief is “incidental” to injunctive or declaratory relief and what is not.
[…] Some consideration of merits okay at certification stage. Paul Karlsgodt: For more than 30 years, plaintiffs’ counsel and many courts have cited the Court’s opinion in […]
I thought the lower courts already found that all the requirements were met for Rule 23.
Yes, the Court’s decision will impact a lot of cases in the future for sure. Read more on the opinion: http://blog.wexlerwallace.com/?p=990
I am a small time college student but while reading the opinion of the court it was very clear the plaintiff did not show enough proof of 1. commonality and 2. company-wide discrimination. When taking a case to the Supreme Court against one of the US’s largest employers you would “assume” the plaintiff would have a bullet in every chamber. Over and over they were firing blanks.To my untrained eye I believe the court was right to reverse the district courts ruling. Burden of proof is in chapter one of my book. Maybe the lawyers need to go back to basics….
[…] since the U.S. Supreme Court issued its decisions in Smith v. Bayer and Wal-Mart Stores, Inc. v. Dukes, I have wondered aloud whether we would start to see a significant divergence between the standards […]
[…] context. First, it offers an analysis of the potential application of various aspects of the Wal-mart Stores Inc. v. Dukes decision outside of the employment discrimination context, including the arguably heightened […]
[…] According to Pete Kasperowicz at The Hill’s Floor Action Blog, Senator Al Franken (D-Minn.) and Representative Rosa DeLauro (D-Conn.) have introduced legislation in Congress intended to reverse limitations on employment discrimination class actions recognized in the Supreme Court’s 2011 decision in Wal-Mart Stores, Inc. v. Dukes. […]
[…] for plaintiffs arising from the “death of Eisen” (the rejection in decisions like Wal-Mart and Comcast of the idea that merits questions were off-limits at the class certification phase) is […]
[…] the Court to continue its trend clarifying the boundaries of class certification in cases like Wal-Mart Stores, Inc. v. Dukes, Amgen Inc. v. Connecticut Retirement Plans and Trust Funds, and Comcast Corp. v. Behrend. The […]
[…] for the Court to continue its trend clarifying the boundaries of class certification in cases like Wal-Mart Stores, Inc. v. Dukes, Amgen Inc. v. Connecticut Retirement Plans and Trust Funds, and Comcast Corp. v. Behrend. The […]