A recent 9th Circuit decision demonstrates the power of the landmark 2011 Supreme Court case Wal-Mart Stores Inc. v. Dukes in employment class actions.
In Wang v. Chinese Daily News, the 9th Circuit overturned the class certification of a wage and hour dispute. In its opinion, the court cited Dukes, in which the high court ruled that a lower court had improperly certified a class of 1.5 million female Wal-Mart employees who claimed the retailer’s policies and practices were discriminatory toward women.
Labor and employment experts say the most important aspect of the 9th Circuit’s decision is the part in which it addresses “trial by formula,” or using inferential statistics to determine classwide damages. The court wrote that employers defending against wage and hour class actions are “entitled to individualized determinations of each employee’s eligibility for monetary relief.”
In Dukes, “the Supreme Court said this whole notion of taking a random sample and extrapolating out violates due process,” explains Thomas Kaufman, a partner at Sheppard Mullin. “But the way they wrote that was not the clearest thing in the world. Some plaintiffs lawyers argued that the court was talking about it only in the context of the way that Title VII [of the Civil Rights Act of 1964] discrimination cases are tried.”