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Federal Government Weighs In On Dukes Class Action

THE Wal-Mart lawsuit - Dukes v. Wal-Mart, the largest discrimination class action in U.S. history - now has a new advocate. And let’s just say, it’s kind of a big one.

The federal government (through the EEOC, or Equal Employment Opportunity Commission) had to this point elected not to get involved in the Dukes lawsuit. Yesterday, however, despite retaining many holdovers from the Bush Administration, the Commission finally threw it’s opinion into the ring. The EEOC filed an Amicus Brief with the U.S. Court of Appeals for the Ninth Circuit, saying it was filing the brief because “this court’s resolution of issues relating to punitive damages and back pay in class cases may directly affect the commission’s enforcement of Title VII” of the 1964 Civil Rights Act, “particularly its systemic litigation.” The staff in charge of deciding whether to intervene in the Dukes case is currently made up of two Democrats and two Republicans.

“If Wal-Mart’s arguments were accepted, it could effectively preclude a claim for punitive damages in most if not all Title VII pattern-or-practice cases including those brought by the Commission,” the EEOC wrote.

The EEOC isn’t actually taking a stand on the merits of the case itself - the Commission is only supporting the class action moving forward, deeming the issue important enough to its functions to intervene and assert its voice.

“If Wal-Mart’s arguments were accepted, it could effectively preclude a claim for punitive damages in most if not all Title VII pattern-or-practice cases including those brought by the Commission,” EEOC Attorney Barbara Sloan wrote. “It would be ‘nonsensical’ to prevent victims of particularly egregious discrimination from proceeding collectively.”

Needless to say, attorneys for plaintiffs welcomed the news, while Wal-Mart’s legal team and the U.S. Chamber of Commerce were less than pleased. The EEOC news comes about a month after the Ninth Circuit announced it would re-hear the class action certification decision en banc - when one party requests an hearing en banc, it means they are requesting a hearing where all judges of a court will hear the case, rather than a panel of them. That hearing is currently scheduled for March 24.

Obama Administration Sides With Wal-Mart Workers [Bloomberg]

By Karen Gullo and Margaret Cronin Fisk

March 19 (Bloomberg)—The Obama administration sided with women suing Wal-Mart Stores Inc. for discrimination, urging a federal appeals court to let the current and former workers sue as a group and proceed with the biggest sex-bias case in U.S. history.

The U.S. Equal Employment Opportunity Commission, weighing in on the lawsuit for the first time since it was filed in 2001, rejected Wal-Mart’s argument that as many as 2 million workers shouldn’t be allowed to seek back pay and punitive damages as a group because that would violate the company’s right to defend itself against each worker’s claims before a jury.

That position would prevent the government from ever seeking punitive damages from companies with a pattern of discrimination and interfere with the EEOC’s ability to obtain redress for violations of Title VII, the federal law that prohibits discrimination, said Barbara Sloan, an EEOC attorney, in a filing with a federal appeals court in San Francisco.

“If Wal-Mart’s arguments were accepted, it could effectively preclude a claim for punitive damages in most if not all Title VII pattern-or-practice cases including those brought by the Commission,” Sloan wrote. “It would be ‘nonsensical’ to prevent victims of particularly egregious discrimination from proceeding collectively.”

Wal-Mart, the largest U.S. private employer, is accused of paying women less than men and giving them fewer promotions. The 2001 lawsuit was originally filed in San Francisco by six women seeking to represent other employees.

Appeals Court

A federal appeals court on March 24 will hear arguments in Wal-Mart’s appeal of a judge’s ruling that allowed workers to sue as a group and seek back pay and punitive damages. Wal-Mart, based in Bentonville, Arkansas, denied discriminating and said it should be allowed to defend the women’s claims on a case-by- case basis.

“We believe the EEOC’s positions are fundamentally incorrect and look forward to presenting our argument to the court of appeals on Tuesday,” Theodore Boutrous, Wal-Mart’s attorney, said today in an e-mail message.

The EEOC’s support of the Wal-Mart class action “can’t simply be attributed to the change in administrations,” said attorney Joseph Sellers, who represents the women. “These are the views of the people who were the holdovers at the commission,” he said.

“Wal-Mart’s position, if adopted by the court, would lead to the elimination of employment class actions larger than a couple of hundred people,” he said.

The EEOC didn’t address the merits of the case. The agency said it was filing the brief because “this court’s resolution of issues relating to punitive damages and backpay in class cases may directly affect the commission’s enforcement of Title VII” of the 1964 Civil Rights Act, “particularly its systemic litigation.”

The U.S. Chamber of Commerce earlier filed an amicus brief supporting Wal-Mart’s efforts to reverse the class-action decision. “If the district court’s decision stands, it will have a potentially destructive effect on the Chamber’s members, who will likely face billions of dollars in new class-action claims,” the organization’s lawyers argued in a March 6 filing.

The EEOC’s support of class certification “would be given considerable weight” by the appeals court considering the decision, law professor Carl Tobias of the University of Richmond said today. “That’s the agency’s area of expertise.”

The case is Dukes v. Wal-Mart Stores Inc., 04-16688, U.S. Court of Appeals for the Ninth Circuit (San Francisco).

Posted by Corey Himrod on Friday, March 20, 2009

Click Here for a Printer-Friendly Version

COMMENTS

This is great news!! It’s about time Dukes vs Wal-Mart moved forward!!

Jane in N.Y. in
Saturday, March 21 at 11:40 AM

I certainly hope that this will make it easier for the case against WalMart and Merrill Lynch to obtain class action certification.

The case is Braden vs. WalMart and alleges that WalMart and Merrill Lynch failed in their fiduciary duties to properly conduct the WalMart employees’ retirement account,resulting in millions of dollars in losses through buying overpriced and underperforming investment instruments.

It also alleges a kickback to Merrill Lynch on some of these fees,and in some instances, for being paid for performing no services at all , according to my understanding. I will repost the info.I have it posted downthread,already,elsewhere.

For those who want more info,type Braden vs. WalMart in the search engine here(upper right corner of page).

ddrb in
Saturday, March 21 at 11:57 AM

The Braden v. Wal-Mart Stores, Inc. et al. ERISA complaint was filed in the United States District Court Western District of Missouri on behalf of Plaintiff and a class (the “Class”) of all persons who were participants in or beneficiaries of the Wal-Mart Profit Sharing and 401(k) Plan (the “Plan”), between January 31, 2002 and the present (the “Class Period”).

Defendant: Wal-Mart Stores Inc, Stanley Gault, Betsy Sanders, Don Soderquist, Jose Villareal, Stephen R. Hunter, Debbie Davis Campbell, John Doe and Jane Doe

Amount Demanded: $75,000,000.00

“The complaint goes further, in alleging that Plan trustee Merrill Lynch & Co. Inc. received revenue-sharing and other, unspecified kickback payments via Plan investment options, without actually providing any services to the Plan, the suit alleges.”

http://www.lawyersandsettlements.com/articles/10446/mutual-fund-erisa-wal-mart.html

The trustee function of the Plan is performed by Merrill Lynch Investment Managers LLC (Trustee). The Trustee receives and holds contributions made to the Plan in trust and invests those contributions as directed by participants and according to the policies established by the Retirement Plans Committee.
The Trustee makes payments from the Plan in accordance with the Plan document. The Trustee is affiliated with Merrill Lynch, Pierce, Fenner & Smith, Inc., the parent corporation of the Trustee and manager of the Merrill Lynch Equity Index Fund and the Merrill Lynch Retirement Preservation Fund, which are investment options offered under the Plan to participants.
The Trustee is also the recordkeeper for the Plan.

According to U.S. District Judge Gary A. Fenner of the U.S. District Court for the Western District of Missouri , who cited Department of Labor reports, the Wal-Mart plan had 1,062,033 participants with net assets of $9.89 billion as of January 31, 2007.
During the time addressed in Braden’s suit, the plan has featured 10 mutual funds, a common/collective trust, Wal-Mart common stock, and a stable value fund as investment options.
Fenner said the mutual funds are all offered through retail class shares and most are actively managed, both of which, the court noted, typically involve HIGHER expenses/fees.

Seven of the 10 mutual funds charge 12b-1 fees, collecting over $26 million in 12b-1 fees over the period involved in the suit, Fenner said, noting that comparable OPTIONS were available that did NOT charge 12b-1 fees. The 10 funds’ fee structure ALSO includes a revenue-sharing CHARGE.

The opinion listed the 10 available funds as:

* PIMCO Total Return Fund (Administrative Class)
* Davis New York Venture Fund (Class A)
* Merrill Lynch Equity Index Trust (Tier 1)
* Massachusetts Investors Growth Stock Fund (Class A)
* Ariel Fund
* Franklin Small-Mid Cap Growth Fund (Class A)
* Merrill Lynch Small Cap Index Trust (Tier 1)
* AIM International Growth Fund (Class A)
* American EuroPacific Growth Fund (Class R4)
* Allianz RCM Technology Fund (Class A).

Although Braden received a temporary setback in the latest ruling 11/21/2008, think Merrill Lynch and Orange County California ruination for billions.

SanDiegoView in WalMart: Your advanced payday loan retirement
Wednesday, December 10(2008) at 03:32 PM

Note: Thanks,SDV for the research.

ddrb in
Saturday, March 21 at 12:16 PM

Why aren’t AIG’s counterparties taking haircuts on their exposure?

And who were AIG’s trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes.

So now we know for sure what we already surmised: The AIG bailout has been a way to HIDE an enormous SECOND ROUND of cash to the SAME group that had received TARP money already."~~~~~~~~~~ [Excerpt] Clusterstock

Recently, Merrill Lych was absorbed by Bank of America,but BONUSES are to be given to Merrill execs.

Congress is demanding transpaencey.

I wonder if any of the recipients are involved in the WalMart ERISA Braden case?

AIG sold WalMArt a LOT of those dubious dead janitor policies years ago ,primarily as tax avoidance instruments.

WalMart later sued AIG about the policies legalityand lost $1.5 billion .

ddrb in
Saturday, March 21 at 12:30 PM

oh shut up crybaby jane who whines about everything wm is accused of and foolishly buys it all and when janes favorite stores get sued and do worse things than walmart has ever done its funny we never hear crap from jane on that.proving my point about all wm haters on here being hypocrites.

MATT IN in gresham,oregon
Monday, March 23 at 10:02 AM

...when janes favorite stores get sued and do worse things than walmart..

Enlighten us, MATT, with some examples of “worse things”.

“There are a lot of issues here, but what they add up to is the end of the age of Wal-Mart,” contends Richard Hastings, a senior analyst for the retail rating agency Bernard Sands. “The glory days are over.”

Ken V in Texas
Tuesday, March 24 at 06:52 AM

costco getting sued numerous times ken for discrimination.ufcw union grocery stores and the ufcw unions telling workers to accept shitty contracts with no raises.ufcw union grocery stores and the union dumping workers on food stamps and state welfare doles by cutting hrs and screwing them out of enough hrs to qualify for benefits.k-mart throwing workers on the sales floor with no training and expecting them to run departments without proper training and then firing them without good cause.remember kenbo i have retail and ufcw union grocery exp unlike you and this crap still goes on in retail and grocery.k-mart never letting people out on time at nite.i still know people in ufcw union grocery and retail ken.

MATT IN in gresham,oregon
Tuesday, March 24 at 10:30 AM

Ken V,

“a senior analyst for the retail rating agency”

And we know how accurate those ‘rating agencies’ are, now don’t we? Remember those rating agencies that rated companies AAA, the same companies that are now failing and helped to create the financial crisis we are facing today?

RDS in
Tuesday, March 24 at 11:37 AM

In 2000 WMT sold over $60. Nine years later WMT is still unable to recapture that ‘glory’, growth has slowed, China Wal-Mart is unionized, Germany Wal-Mart and South Korea Wal-Mart no longer exist. Ten years ago the Waltons held five of the top ten richest people and now they hold none...so, yeah, I’d say the glory days are over.

Live Better In Cheap Underwear

Ken V in Texas
Tuesday, March 24 at 12:23 PM

Ken V,

“Nine years later WMT is still unable to recapture that ‘glory’, growth”

That is just because of a thing called the ‘law of diminished returns’!! You once owned a restaurant, if you had opened a second restaurant, would you have doubled your earnings and a third would have tripled your earnings? If a customer drives to another town to shop at Wal-Mart, building a store in their town, may be more convenient for the customer, but, won’t increase income from that customer!! All it does, is provide for the people who were unable to drive to that other town!! Also, 2 stores will double the overhead and therefore cut down profits!!

It’s no wonder you are a FORMER restaurant owner!!

RDS in
Tuesday, March 24 at 01:17 PM

Nine years later WMT is still unable to recapture that ‘glory’, growth

How sure are you about your “factoid hemorrhoids”, Kenneth?

Seems to me like the masses finally stopped drinking that union Kool-Aid and checked things out for themselves (good thing WM had the foresight to spiff-up a chunk of their stores, making them more “Target-esque”, huh?).

In 2000 WMT sold over $60

A few months ago, WMT sold over $60—even with the current mess, WM is firmly leading the retail pack in comnparison with TGT, SHLD, COST, and the rest.

China Wal-Mart is unionized

Chinese unions are modern-day American unions are two different animals.

That’s almost as ridiculous as the post floating around here comparing “Big Union” to the Chamber of Commerce.

Germany Wal-Mart and South Korea Wal-Mart no longer exist.

Which happened 3 years ago, not last month or last year, as your post might imply. Ancient history, bud.

Ten years ago the Waltons held five of the top ten richest people and now they hold none

Could it be because some of them may be deceased? Kind of hard to bring people back to life…

Tsk-tsk…

bbrd in
Tuesday, March 24 at 02:20 PM

WM is firmly leading the retail pack...

Business bunny Erin Burnet refers to Wal-Mart’s firm lead as “bottomfeeding. As I so often sig my posts, what’s good for Wal-Mart is BAD for America.

Chinese unions are modern-day American unions are two different animals.

Then why did the Chinese government have to insist on the unionization of Wal-Mart?

Ancient history, bud.

So are the glory days of Wal-Mart.

Live Better In Cheap Underwear

Ken V in Texas
Tuesday, March 24 at 09:32 PM

Ken V,

“Then why did the Chinese government have to insist on the unionization of Wal-Mart?”

Maybe because the Chinese government runs the unions!! In case you hadn’t heard, China is still a socialist country!!

RDS in
Tuesday, March 24 at 11:07 PM

Well it all finally worked out for Sam the China man. The dead bastard wanted his WalMart public relations image to avoid the ‘appearance’ of WalMart doing business with the CHINESE COMMUNIST after the Tienanmen Square massacre in 1989 . That is more SIFE capitalism hypocrisy at work in the WalMart business theology model for ‘love of money’ anti-Christian psychopaths.

From Frontline-

Following the brutal suppression of Chinese students in Tienanmen Square in 1989 by the Chinese Communist leadership, Walton feared a consumer backlash if Wal-Mart were seen as operating in China. He was also disturbed by charges of human rights abuses in his Asian suppliers’ factories.

To continue growing in Asia, Wal-Mart needed a buffer—a middleman or a buying agency that would purchase Asian products without showing Wal-Mart’s hand. According to the retired Hong Kong senior executive, Walton told Bill Fields, Wal-Mart’s head buyer, that he wanted to “get out” of direct involvement in Asia. “The decision was to go to an exclusive buying agency,” the buyer said. “The main reason for going into [the deal] was not to be exposed as going into Communist China.”

http://www.pbs.org/wgbh/pages/frontline/shows/walmart/secrets/wmchina.html

This was also Sam Walton’s real attitude against American labor and his ‘love of money’ psychopath anti-American anything for a buck attitude and why he went into China in the first place including the design of products…

“We are seeing an emerging shift in product development,” said Tom Travis, a trade lawyer at Miami’s Sandler, Travis & Rosenberg, who counts Wal-Mart among his clients. Chinese manufacturers “are assuming much more of the functions, creating and designing … the product.”

http://www.pbs.org/wgbh/pages/frontline/shows/walmart/secrets/wmchina.htm

Sam Walton again on exploitation of people especially labor-

Wal-Mart founder Sam Walton once said, “I pay low wages. I can take advantage of that. We’re going to be successful, but the basis is a very low-wage, low-benefit model of employment.”
http://en.wikipedia.org/wiki/Criticism_of_Wal-Mart#_note-
iswalmartgood

“Is Wal-Mart Good for America?” PBS. November 16, 2004. Retrieved on February 24, 2007.

WalMart/Waltons- We have supported Chinese communism for decades. It is also where we sent your good paying manufacturing jobs. Whether America likes it or not, the Walton billionaires and the communist Peoples Liberation Army want to thank you… the American suckers!

“Profits, like sausages… are esteemed most by those who know least about what goes into them.” - Alvin Toffler

SanDiegoView in WalMart is American economic suicide
Wednesday, March 25 at 07:00 AM

China is still a socialist country!!

Um, China is a communist country. The USA is a socialist county.

“The free market for all intents and purposes is dead in America.” Senator Jim Bunning, (R) Kentucky

Ken V in Texas
Thursday, March 26 at 09:38 AM

Ken V,

“The USA is a socialist county.”

Socialism (noun) 1 A theory of political and economic organization advocating public collective ownership of the means of production, public management of all industries, and production for need and use instead of profit!! ~ Websters

I know that that is what you want, but, we are not quite there yet!! The USA is still a Captilistic Republic!!

RDS in
Thursday, March 26 at 01:11 PM

...public collective ownership...

As taxpayers we collectively own the post office, the military, AIG, Bank of America, Chyrsler and General Motors. Call it whatever you like, but what we have is not ‘Captilistic’ (sic) anything!

Capitalism tries for a delicate balance: It attempts to work things out so that everyone gets just enough stuff to keep them from getting violent and trying to take other people’s stuff. ~ George Carlin

Ken V in Texas
Thursday, March 26 at 02:05 PM

Ken V,

“As taxpayers we collectively own the post office, the military, AIG, Bank of America, Chyrsler and General Motors. Call it whatever you like, but what we have is not ‘Captilistic’ (sic) anything!”

Sounds like a good start towards Socialism, doesn’t it, and if we keep it up, we could go to full blown Communism!! All we have to do, is back the unions, which could eventually be controlled by the government, similar to what China is doing with their unions!!

America, on a race towards Communism, thanks to Liberalism!!

RDS in
Friday, March 27 at 02:29 AM

Why should the Investor Class prosper at the expense of the Working Class? We just came off of a decade or so where wages have been stagnant. Everything else went up but not Working Class wages.

You can deny where we are right now but the greedy, dishonest, unpatriotic Investor Class, representing 1/3 of the U.S. economy threatens to drag the other 2/3 (Working Class) down with it.

Wal-Mart’s core business model and value proposition requires perpetual cost reductions for lower prices, higher volume and increased velocity to achieve profitable growth.
Problem #1: for Wal-Mart: over time, they cannot keep cost squeezing their vendors’ margins to death; and, problem #2: the percentage of their total business in groceries keeps increasing faster than their other categories, and groceries yield razor thin operating margins of 1-2% vs. their current overall margin of about 5%.

Ken V in Texas
Friday, March 27 at 02:33 PM

Ken V,

“Why should the Investor Class prosper at the expense of the Working Class?”

It has worked for the last 50+ years!! But, somehow you think the government can do a better job of it, right?

RDS in
Saturday, March 28 at 01:39 AM

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