The Supreme Court on Monday blocked a massive sex discrimination lawsuit against Wal-Mart on behalf of women who work there.
The court ruled unanimously that the lawsuit against Wal-Mart Stores Inc. cannot proceed as a class action, reversing a decision by the 9th U.S. Circuit Court of Appeals in San Francisco. The lawsuit could have involved up to 1.6 million women, with Wal-Mart facing potentially billions of dollars in damages.
Now, the handful of women who brought the lawsuit may pursue their claims on their own, with much less money at stake and less pressure on Wal-Mart to settle.
The justices divided 5-4 on another aspect of the ruling that could make it much harder to mount similar class-action discrimination lawsuits against large employers.
Justice Antonin Scalia's opinion for the court's conservative majority said there needs to be common elements tying together "literally millions of employment decisions at once."
But Scalia said that in the lawsuit against the nation's largest private employer, "That is entirely absent here."
Justice Ruth Bader Ginsburg, writing for the court's four liberal justices, said there was more than enough uniting the claims. "Wal-Mart's delegation of discretion over pay and promotions is a policy uniform throughout all stores," Ginsburg said.
Business interests lined up with Wal-Mart while civil rights, women's and consumer groups have sided with the women plaintiffs.
Both sides have painted the case as extremely consequential. The business community has said that a ruling for the women would lead to a flood of class-action lawsuits based on vague evidence. Supporters of the women feared that a decision in favor of Wal-Mart could remove a valuable weapon for fighting all sorts of discrimination.