It took only a few minutes of argument Wednesday by a lawyer who sued discount retailer Wal-Mart over the way it allegedly treats its women workers for a potentially fatal flaw in that case to stand out boldly.  It was what Justice Anthony M. Kennedy called, simply, an “inconsistency,” but it clearly could scuttle the entire idea that some 500,000 female employees can combine their challenge to the company into one massive case.

A basic claim of the case — absolutely vital to it, it seems — is that Wal-Mart has a policy of maintaining a common “culture” (the “Wal-Mart Way”) that ensures uniformity throughout its thousands of stores, yet company headquarters gives its local store managers unlimited discretion to decide workers’ pay and promotions, and the two together result company-wide in lower pay and fewer promotions for female employees.  As a logical proposition, that may seem somewhat self-contradictory, and that was exactly Kennedy’s point.  And his vote would seem to be a crucial one, given how other Justices reacted.

In order for the case that has come to be known widely as Dukes v. Wal-Mart to continue in a federal court as a class-action lawsuit, the legal and factual issues must share commonality; that is one of the minimum characteristics it must have under a federal court rule (Rule 23[a]).  And much of Wednesday’s argument focused on whether the class of women workers (past and present) can satisfy that requirement, and the key uncertainty seemed to be just what Wal-Mart’s employment policy is.

The hearing had something of a meandering quality while Wal-Mart’s lawyer, Theodore J. Boutrous, Jr., of Los Angeles, was at the lectern, as the Justices searched for an understanding of how the policy might actually lead to discrimination in wages and advancement.  Coincidentally, the three women Justices tended to dominate that part of the discussion, with questions and comments that exhibited some skepticism about Boutrous’s presentation.

But when the female employees’ lawyer, Joseph M. Sellers of Washington, started his side of the argument, it did not take long for Justice Kennedy to say that “it’s not clear to me: what is the unlawful policy that Wal-Mart has adopted, under your theory of the case.”  Store managers, the attorney replied, have been given “unchecked discretion,” and they use it to discriminate.

But, Kennedy said, “It’s hard for me to see…Your complaint faces in two directions.  Number one, you said this is a culture where Arkansas knows, the headquarters knows, everything that’s going on.  Then in the next breath, you say, well, now these supervisors have too much discretion.  It seems to me there’s an inconsistency there, and I’m just not sure what the unlawful policy is.”

Sellers chose in reply to dwell on the breadth of the store managers’ discretion, saying “There’s no guidance whatsoever about how to make those decisions.”   The discretion, he added,  is then used within “a very strong corporate culture” that leads managers to be “informed by the values the company provides.”   The response itself seemed contradictory: if there was “no guidance whatsoever,” how were the managers led to apply company “values”?

Justice Antonin Scalia picked up on that.  “I’m getting whipsawed here.  On the one hand, you say the problem is that they were utterly subjective, and on the other hand you say there is a strong corporate culture that guides all of this.  Well, which is it?  It’s either the individual supervisors are left on their own, or else there is a strong corporate culture that tells them what to do.”

Sellers sought to reconcile the two assertions by noting that, when would-be store managers are trained at the company’s “Sam Walton Institute,” they are told to take sex into account as a stereotype about gender characteristics, that women get more promotions when they are “aggressive,” like men who get promotions.  Scalia, perhaps half in derisive jest, suggested that the message could be “If you have an aggressive woman, promote her!”   Sellers tried to end the exchange by saying that the questions were ones that Wal-Mart could address when the case went to trial.

Justice Stephen G. Breyer tried to lend a hand to Sellers, suggesting that every woman in the class of Wal-Mart workers suing could share something in common, if headquarters knew that store managers were using their discretion to accomplish discrimination, then perhaps the company had a legal obligation to withdraw some of that discretion “in order to stop these results.”  Sellers said mildly that was “a fair way to put it.”

Though Sellers’ most persistent questioners were Kennedy, Scalia, Chief Justice John G. Roberts, Jr., and Justice Samuel A. Alito, Jr., he did not escape entirely from some tough questioning from Justices Ruth Bader Ginsburg, Elena Kagan and Sonia Sotomayor.  Ginsburg was a bit worried about how, if the class action did proceed, a federal judge could handle the issue of sorting out who among them received an award of back pay, and Kagan and Sotomayor appeared troubled about how the judge would handle individual hearings into the job harms allegedly done to specific women employees.

Several of the Justices, of varying ideological cast, appeared troubled about the heavy use that the women’s lawyers have made of statistical models to show that discrimination is actually widespread within the ranks of Wal-Mart’s nearly 1 million workers.   Wal-Mart’s legal strategy very heavily targets the use of those models, saying that it relieves the suing women of actually proving they suffered biased treatment, and it takes away the company’s legal right to defend itself against the claim of bias.

 

 

 

Posted in Wal-Mart v. Dukes, Featured, Merits Cases

Recommended Citation: Lyle Denniston, Argument recap: A fatal flaw detected?, SCOTUSblog (Mar. 29, 2011, 12:12 PM), http://www.scotusblog.com/2011/03/argument-recap-a-fatal-flaw-detected/