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In public, Wal-Mart Stores has aggressively defended itself from the biggest discrimination class action in U.S. history. In fact, it’s appealing certification of the class before the Ninth Circuit U.S. Court of Appeals. But behind the scenes, the company is engaged in settlement negotiations with lawyers for a class estimated to contain 1.6 million female employees, say attorneys familiar with the talks. Dukes v. Wal-Mart Stores alleges that the nation’s largest retailer paid women less and promoted them less frequently than men. The settlement talks, which began some months ago, are gaining momentum, say the sources. Lawyers for both sides reportedly met in mid-February to discuss settling. None of the lawyers involved in the litigation would comment on settlement talks. But other members of the class action bar say Wal-Mart’s willingness to settle is signaled by its choice of counsel for the discussions and by the mediator facilitating the talks. Reportedly, the parties have hired Hunter Hughes III — a famously effective class action mediator — to handle the negotiations. And sources say Wal-Mart has hired Meyer Koplow — engineer of a nationwide $200 billion tobacco settlement in 1998 — to represent it at the table. Koplow, a partner at Wachtell, Lipton, Rosen & Katz, is known for settling difficult claims for high-profile clients. In recent years, he has represented CNA Financial Corp. in an attempt to create an asbestos settlement fund and has worked with Herbert Wachtell to help World Trade Center leaseholder Larry Silverstein in his effort to collect $3.5 billion from insurers. Reached by phone last week, Koplow would not say whether he is involved in the gender discrimination suit. “There are a bunch of things I do for Wal-Mart,” he said. Speaking generally, Koplow said his practice focuses on resolving seemingly untenable situations. “I settle very complicated disputes,” he said. “Whether it’s asbestos or tobacco or whatever the subject matter may be, that’s what I do.” Koplow’s hiring makes Wachtell, Lipton the latest in an ever-changing cadre of prominent firms employed by Wal-Mart since the suit was filed. After initially using Seyfarth Shaw, Wal-Mart brought in Jones Day. Both firms eventually withdrew. Wal-Mart hired Paul, Hastings, Janofsky & Walker to take over the case. Paul, Hastings is working with Gibson, Dunn & Crutcher’s Theodore Boutrous Jr., who is leading the appeal of the certification, which was granted by U.S. District Judge Martin Jenkins in June. On the plaintiff side, Impact Fund’s director, Brad Seligman, is leading a band of private firms and nonprofit groups. Seligman has been involved in a series of large settlements, including State Farm Insurance Co. and Lucky Stores. Hughes wins high marks as a peacemaker. The partner in Atlanta’s Rogers & Hardin built a reputation defending employers against class actions before he gained greater renown for facilitating major settlements in such suits. In November, he mediated a $50 million proposed settlement in a class action against clothier Abercrombie & Fitch in federal court in San Francisco. Other notable resolutions include an $81.5 million settlement between female employees and Publix stores, an $87.5 million agreement to settle gender discrimination claims against Home Depot, and a $192.5 million deal between Coca-Cola and employees claiming race discrimination. “There are other good mediators, but no one has as many big cases on a nationwide basis,” said Bill Lann Lee, a partner at Lieff Cabraser Heimann & Bernstein who represented plaintiffs in the Abercrombie suit. “I believe that when parties call upon someone with Hunter Hughes’ reputation, there’s a substantial degree of interest” in settling. Hughes declined last week to talk about Wal-Mart. Lee and other lawyers said Hughes is particularly effective in cases like Wal-Mart where plaintiffs are seeking substantial injunctive relief — in addition to financial damages — as a condition of settling. His opinions hold weight, they said, because of his combination of defense-side side credentials and openness to plaintiff arguments. “Hunter Hughes can explain the weaknesses of your case to you, and he can explain the strengths of both sides,” said Lee. Paul, Hastings’ lawyers representing Wal-Mart say they are not permitted to speak about the case, and Boutrous said he is familiar only with the appeal. A Wal-Mart spokeswoman also declined to comment on settlement talks. “We never have, and never would, discuss publicly the existence, non-existence or any other aspect of settlement discussions concerning a pending lawsuit,” wrote the spokeswoman, Sarah Clark, in an e-mail Thursday. “In connection with this case, Wal-Mart is looking forward to pursuing its pending appeal to the Ninth Circuit regarding the district court’s class certification order.” Plaintiff lawyers were similarly reserved. Seligman would neither confirm nor deny the talks and said that in past class actions that he’s settled, public silence is necessary in pushing forward a settlement. “My practice is that these things have to be completely off the record and quiet,” he said.

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