The hot topic right now in the class action world is the oral argument in the Supreme Court in Wal-Mart v. Dukes (transcript; pdf).  This employment case — claiming that all female employees of Wal-mart suffered discrimination in pay and promotion — was certified as a class action and certification was affirmed by a 6-5 en banc opinion of the 9th Circuit.

Most commentators seem to be predicting a victory for Wal-Mart, including the ABA Journal, SCOTUS Blog, and HR Lawyer’s Blog.  That was also the consensus at a webcast I attended presented by Carter Phillips and Prof. Martin Redish, sponsored by the Defense Research Institute.  The New York Times, was somewhat more reserved, as one would expect, noting the Court “appeared closely divided” on the case.

My guess, assuming the justices comments were indicative of their viewpoints, is that Wal-Mart will win the issue of whether back pay can be awarded under Rule 23(b)(2), and seems likely to also win on commonality (that could well be 5-4).

What implications will this case have for insurance class actions?  My thoughts:

  • The decision should be authoritative on when a class for declaratory relief can be certified under 23(b)(2) when the class is seeking damages.  This issue often arises in insurance cases, see my recent post on the Seventh Circuit’s Kartman decision.  Even more liberal members of the Court, including Justices Ginsburg and Sotomayor, seemed unlikely to allow the Wal-Mart case to go forward based on the plaintiffs’ theory that damages could be awarded based on a formulaic calculation.  The following questions from Justice Sotomayor (for whom I worked as a law student intern years ago) got to the heart of this:

“You’re going to say through my statistical model, I will be able to identify those women in the class who are deserving of pay raises.  What that doesn’t answer is when in this process is the defendant going to be given an opportunity to defend against that finding?  . . . They will be precluded from attempting to show any particular evidence that a particular decision was not made?”  (Transcript at 46-47)

Some justices suggested that a class seeking declaratory/injunctive relief only might work.  In most insurance class actions a formulaic calculation of damages is not possible, so if the Court rules that is the only type of damages that can be awarded in 23(b)(2) cases (as most circuits have), that should make 23(b)(2) classes very difficult to bring in insurance cases.  Insurance lawyers also will need to look carefully at what the opinion says, if anything, about declaratory or injunctive relief that is really a request for damages in disguise.

  • A holding that the Wal-Mart case lacks commonality might reinvigorate the commonality requirement.  Some courts find commonality easy to satisfy if there is any potential common question of law or fact, and focus instead on predominance.  The Supreme Court majority may breathe new light into the commonality requirement.  Insurance class actions often hinge on predominance, and a reinvigoration of commonality could raise the bar for certification.
  • The Court might touch on the debate about the extent to which the merits can be addressed at class certification, as addressed in recent years by the Second and Third Circuits in the IPO and Hydrogen Peroxide cases.  Justice Alito asked about this (transcript at 10).  A favorable comment by the Court about a strong “rigorous analysis” standard will reinforce those decisions.
  • The Court might say something about the use of experts at class certification.  This is not a question presented by the briefs, but it is centrally at issue on the facts — at argument there was extensive discussion of both sides’ expert testimony about the what Wal-Mart women experienced, and whether back pay could be based on a expert’s formulaic calculation.  Justice Sotomayor asked a question (transcript at 8) about what the standard should be.  The Court might indirectly comment on whether Daubert-type challenges can be made at the class certification stage.

 

Tags: Rule 23(b)(2), Supreme Court, Wal-Mart v. Dukes
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Photo of Wystan Ackerman Wystan Ackerman

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you…

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you have something to say.  For those looking for my detailed law firm bio, click here.  If you want a more light-hearted and hopefully more interesting summary, read on:

People often ask about my unusual first name, Wystan.  It’s pronounced WISS-ten.  It’s not Winston.  There is no “n” in the middle.  It comes from my father’s favorite poet, W.H. (Wystan Hugh) Auden.  I’ve grown to like the fact that because my name is unusual people tend to remember it better, even if they don’t pronounce it right (and there is no need for anyone to use my last name because I’m always the only Wystan).

I grew up in Deep River, Connecticut, a small town on the west side of the Connecticut River in the south central part of the state.  I’ve always had strong interests in history, politics and baseball.  My heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox).  I think it was my early fascination with Lincoln that drove me to practice law.  I went to high school at The Williams School in New London, Connecticut, where I edited the school newspaper, played baseball, and was primarily responsible for the installation of a flag pole near the school entrance (it seemed like every other school had one but until my class raised the money and bought one at my urging, Williams had no flag pole).  As a high school senior, my interest in history and politics led me to score high enough on a test of those subjects to be chosen as one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified my interest in law and government.  One of my mentors at Williams was of the view that there were far too many lawyers and I should find something more useful to do, but if I really had to be a lawyer there was always room for one more.  I eventually decided to be that “one more.”  I went on to Bowdoin College, where I wrote for the Bowdoin Orient and majored in government, but took a lot of math classes because I found college math interesting and challenging.  I then went to Columbia Law School, where I was lucky enough to be selected as one of the minions who spent their time fastidiously cite-checking and Blue booking hundred-plus-page articles in the Columbia Law Review.  I also interned in the chambers of then-Judge Sonia Sotomayor when she was a relatively new judge on the Second Circuit, my only connection to someone who now has one-ninth of the last word on what constitutes the law of our land.  I graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole, one of the largest Connecticut-based law firms.  At the end of 2008, I was elected a partner at Robinson+Cole.

I’ve worked on class actions since the start of my career.  Being in the insurance capital of Hartford, we have a national insurance litigation practice and most of the class actions I’ve defended have been brought against insurance companies. I’ve also handled some involving products liability, managed care, health care, utilities, financial services, higher education and environmental issues.

My insurance class action practice usually takes me outside of Connecticut.  I’ve had the pleasure of working on cases in various federal and state courts and collaborating with great lawyers across the country.  While class actions are an increasingly large part of my practice, I don’t do exclusively class action work.  The rest of my practice involves litigating insurance coverage cases, often at the appellate level.  That also frequently takes me outside of Connecticut.  A highlight of my career thus far was working on Standard Fire Ins. Co. v. Knowles, the U.S. Supreme Court’s first Class Action Fairness Act case.  I was Counsel of Record for Standard Fire on the cert petition, and had the pleasure of working with Ted Boutrous on the merits briefing and oral argument.

I started this blog because writing is one of my favorite things to do and I enjoy following developments in class action law, writing about them and engaging in discussion with others who have an in interest in this area.  It’s a welcome break from day-to-day practice, keeps me current, broadens my network and results in some new business.

When I’m not at work, you might find me running lines or watching a musical with my teenage daughter who hopes to be a Broadway star (or taking her to voice or dance lessons) or reading a good book.

Read more about Wystan Ackerman
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