Cheryl Phipps v. Wal-Mart Stores, Inc.

792 F.3d 637, 2015 FED App. 0140P, 2015 U.S. App. LEXIS 11616, 127 Fair Empl. Prac. Cas. (BNA) 945, 2015 WL 4079441
CourtCourt of Appeals for the Sixth Circuit
DecidedJuly 7, 2015
Docket13-6194
StatusPublished
Cited by17 cases

This text of 792 F.3d 637 (Cheryl Phipps v. Wal-Mart Stores, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cheryl Phipps v. Wal-Mart Stores, Inc., 792 F.3d 637, 2015 FED App. 0140P, 2015 U.S. App. LEXIS 11616, 127 Fair Empl. Prac. Cas. (BNA) 945, 2015 WL 4079441 (6th Cir. 2015).

Opinions

[640]*640STRANCH, J., delivered the opinion of the court which MERRITT, J., joined, and COOK J., joined in part. COOK, J. (pg. 653-54), delivered a separate opinion concurring in part and dissenting in part.

OPINION

STRANCH, Circuit Judge.

This putative class action lawsuit began after the Supreme Court’s decision in Wal-Mart Stores, Inc. v. Dukes, — U.S. -, 131 S.Ct. 2541, 180 L.Ed.2d 374 (2011). There the Supreme Court rejected certification, under Federal Rule of Civil Procedure 23(b)(2), of a nationwide class of current female employees of Wal-Mart Stores, Inc., who alleged that Wal-Mart discriminated against them in pay and promotions based on their gender. Plaintiffs Cheryl Phipps, Bobbi Millner, and Shawn Gibbons, unnamed class members in Dukes, thereafter filed suit against Wal-Mart in federal district court in Tennessee alleging individual and putative class claims under Rule 23(b)(2) and Rule 23(b)(3) on behalf of current and former female employees in Wal-Mart Region 43. Plaintiffs claim gender discrimination in pay and promotions as the result of regional Wal-Mart management policies and decisions.

Before us for review is the district court’s order granting Wal-Mart’s motion to dismiss the class claims as time-barred under the tolling principles of American Pipe & Construction Co. v. Utah, 414 U.S. 538, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974), and Crown, Cork & Seal Co. v. Parker, 462 U.S. 345, 354, 103 S.Ct. 2392, 76 L.Ed.2d 628 (1983). This interlocutory appeal concerns only whether the plaintiffs may initiate this suit. Whether the proposed classes are appropriate for certification is not at issue here.

We hold that the putative class claims are not barred by American Pipe or Crown, Cork & Seal Co. and that the case before the district court may proceed. Accordingly, we REVERSE the district court’s order dismissing the class claims under Federal Rule of Civil Procedure 12(b)(6) and we REMAND the case to the district court for further proceedings.

I. PROCEDURAL HISTORY

Wal-Mart is the country’s largest private employer, operating approximately 3,400 stores and employing more than one million people. Dukes, 131 S.Ct. at 2547. Wal-Mart divides its stores into nationwide divisions and subdivides the divisions into regions. Id.

On June 8, 2001, six named plaintiffs filed suit under Title VII of the Civil Rights Act of female employees of Wal-Mart. Id. The suit alleged a company-wide pattern or practice of gender discrimination in pay and promotions since December 26, 1998.1 Id. at 2548. The plaintiffs also claimed that management decisions concerning pay and promotions disproportionately favored men, leading to unlawful disparate impact on female employees. Id. The plaintiffs further claimed that, because Wal-Mart knew of this discriminatory effect, its refusal to modify the corporate culture amounted to unlawful disparate treatment. Id. The plaintiffs [641]*641sought certification of a nationwide class of current and former female employees under Rule 23(b)(2), or alternatively, under Rule 23(b)(3), and requested injunctive and declaratory relief, backpay, and punitive damages. Id. at 2548, 2561 n. 1 (Ginsburg, J., concurring in part and dissenting in part).

In 2004, following extensive discovery, the district court certified a nationwide class under Rule 23(b)(2) for purposes of liability, injunctive and declaratory relief, back pay, and punitive damages. Dukes v. Wal-Mart Stores, Inc., 222 F.R.D. 137, 187-88 (N.D.Cal.2004). In 2007, the Ninth Circuit affirmed, Dukes v. Wal-Mart, Inc., 509 F.3d 1168, 1193 (9th Cir.2007), but on rehearing en banc, the Ninth Circuit affirmed in part and remanded in part. Dukes v. Wal-Mart Stores, Inc., 603 F.3d 571, 628 (9th Cir.2010). The court affirmed the district court’s certification of a nationwide class under Rule 23(b)(2) only for current Wal-Mart employees — defined as those employed on the date the complaint was filed — with respect to their claims for declaratory and injunctive relief and back pay. Id. at 624. The court remanded the case to the district court to consider whether certification under Rule 23(b)(2) or Rule 23(b)(3) was appropriate for the punitive damages claims of current employees and whether an additional class or classes should be certified under Rule 23(b)(3) for former employees — defined as those no longer employed on the date the complaint was filed. Id. The court reasoned that “putative class members who were no longer Wal-Mart employees at the time Plaintiffs’ complaint was filed do not have standing to pursue injunctive or declaratory relief,” and it was “difficult to say that monetary relief does not predominate with respect to claims by plaintiffs who lack standing to seek injunctive or declaratory relief.” Id. at 623.

The California district court did not have an immediate opportunity to consider the issues remanded by the Ninth Circuit. The Supreme Court granted certiorari, and in June 2011 reversed the certification of the nationwide class of current Wal-Mart employees under Rule 23(b)(2). Dukes, 131 S.Ct. at 2561. The Court held that the plaintiffs did not demonstrate questions of law or fact common to the class as required by Rule 23(a)(2) to warrant certification of a nationwide class of current employees. Id. at 2252-57. The Court reasoned that, because the plaintiffs had not provided “significant proof’ of a nationwide policy or other “specific employment practice” that discriminated against all 1.5 million class members in the same way, the case was not suitable for nationwide class treatment. Id.

The Court further concluded that the plaintiffs’ requests for backpay were improperly certified under Rule 23(b)(2) because such relief was not incidental to injunctive or declaratory relief, and “individualized monetary claims belong in Rule 23(b)(3).” Id. at 2557-58. The Court outlined the differences between classes certified under Rule 23(b)(2) and Rule 23(b)(3), noting that (b)(3) requires notice to class members and a chance to opt out, while (b)(2) does not. Id. at 2558. Accordingly, the Supreme Court reversed the Ninth Circuit’s certification of a nationwide class of current Wal-Mart employees under Rule 23(b)(2). Id. at 2561.

After Dukes, the plaintiffs promptly filed a motion in the California district court to extend tolling of the statute of limitations under American Pipe & Constr. Co., 414 U.S. at 553-54, 94 S.Ct. 756. The district court granted the motion in part, providing that all class members who possessed right-to-sue letters from the Equal Employment Opportunity Commission (EEOC) could file suit on or be[642]*642fore October 28, 2011. Dukes v. Wal-Mart Stores, Inc., No. C 01-02252 CRB, Order at *1-2 (N.D.Cal. Aug. 19, 2011).

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792 F.3d 637, 2015 FED App. 0140P, 2015 U.S. App. LEXIS 11616, 127 Fair Empl. Prac. Cas. (BNA) 945, 2015 WL 4079441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cheryl-phipps-v-wal-mart-stores-inc-ca6-2015.