California Labor and Employment Defense Blog

In Granting Class Certification District Courts "Must" Consider the Merits of the Claims -- Ellis v. Costco Wholesale Corp.

In Ellis v. Costco Wholesale Corp., the district court certified a nation-wide class of female Costco employees in what amounted to a carbon copy of the Dukes case against Wal-Mart.  The Ninth Circuit was therefore required to re-evaluate the certification decision in light of the Supreme Court's ruling in Dukes.

The result was a mixed bag that affirmed as to some certification findings but vacated and remanded as to others.  The most significant (in my opinion) aspect of the ruling is the Ninth Circuit's express directive to weigh the merits of the class-wide discrimination claims on remand as part of the certification decision:

[T]he merits of the class members’ substantive claims are often highly relevant when determining whether to certify a class. More importantly, it is not correct to say a district court may consider the merits to the extent that they overlap with class certification issues; rather, a district court must consider the merits if they overlap with the Rule 23(a) requirements.

This seems to be the culmination of long terms trend to break down the distinction between the procedural certification decision and the assessment of the merits of the case.  This emphasis on the merits may make certification more difficult in some cases.  However, it further reinforces the certification decision as the "big event" that not only decides whether the case may proceed as a class action but also suggests that the court is favorably disposed toward the merits.

  

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