Why the Wal-Mart Litigation Makes Our Legal System Look Bad

Susan Beck

The Litigation Daily

10-19-2012

It's cases like Wal-Mart that make me throw up my hands over our civil legal system.

For 11 years, women who worked at the giant retailer have been trying to get somebody to hear their claims that they weren't treated fairly in promotions and hiring. Despite the decade-plus of litigation, they're barely past square one.

There's a lot of blame to go around for this unending slog through our federal courts, which has left these women and their lawyers still seeking class certification. As I pointed out in a column two years ago, the U.S. Court of Appeals for the Ninth Circuit unconscionably dragged its feet reviewing this case--taking six years to issue a final ruling. Plaintiffs lawyers arguably let their ambitions get in the way of a practical strategy by trying to represent such an enormous, far flung class. You could also blame the U.S. Supreme Court majority in Wal-Mart Stores Inc. v. Dukes, which threw out the Ninth Circuit's class certification last year because the class was too big and the women's claims didn't share sufficient commonality, but left the parties and public at large with a confusing, nebulous standard.

Now we've got a new twist, and it's one that defies common sense and basic notions of fairness. On Monday U.S. District Judge Reed O'Connor in Dallas dismissed a class action filed on behalf of current and former female Wal-Mart employees who worked in Texas. This case is one of four that have been filed so far as regional subsets of the original nationwide class in response to the Supreme Court's ruling. Judge O'Connor sided with Wal-Mart and its lawyers at Gibson, Dunn & Crutcher and found that the women's class claims are barred by the statute of limitations.

Think about it. These women waited more than a decade for their case to wind its way through our legal system, winning rulings on class certification the entire way until a divided Supreme Court reversed. Now, after being told by the highest court in the land to start over, the Texas women are told by the district court that they waited too long to bring this case. Gotcha!

Judge O'Connor rested his 19-page ruling on a 1985 decision by the U.S. Court of Appeals for the Fifth Circuit called Salazar-Calderon v. Presidio Valley Farmers Association. There, farm workers who were denied class certification in a case against growers refiled a modified case in a different district. Citing concern about plaintiffs abusing the system, the Fifth Circuit held that the statute of limitations wasn't tolled by the original case because it wouldn't be right to allow plaintiffs to "piggyback one class action onto another and thus toll the statute of limitations indefinitely." Even though the Supreme Court's held in American Pipe that the filing of a purported class action tolls the statute of limitations for the claims of all putative members until the court rules on certification, that case didn't apply, O'Connor ruled. That tolling principle only applies when a plaintiff files an individual case, not when she attempts to file a new class action, the judge held.

I understand concerns about litigants abusing the rules. But that's not the case with the Texas women. For years they were told by courts they could bring their claims as a class, until the Supreme Court reversed. They were following the rules, and then the rules changed.

A federal judge in San Francisco, by the way, came to the opposite conclusion about tolling in a different Wal-Mart follow-on case. In late September U.S. District Judge Charles Breyer noted in this ruling that the law on tolling is "unsettled" in cases like this, but concluded that the plaintiffs should be allowed to continue pressing their class claims. Allowing the case before him to move forward, Breyer wrote, is consistent with the purpose of a statute of limitations, which is to avoid prejudice to the defense and unfair surprise.

I'm not taking a position on whether the discrimination claims against Wal-Mart are valid, or on whether classes should be certified. But when the Texas women are bounced from court on statute of limitation grounds under these extraordinary circumstances, it makes our federal court system look less like a fair playing field and more like a boobytrap.

This article originally appeared in The AmLaw Litigation Daily.