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(USPS 080 900) October 8, 2018 (ISSN 0007-7135) S Issue no. 4587 Published weekly, except one week in January, February, April, June, July, September, and December, by Bloomberg L.P. Periodicals
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Moussouris v.
Microsoft Corp.
Case #2:15-cv-01483
ThePayGap, Microsoft, and
The Limits of Class Actions
① THE ORIGIN
Katie Moussouris, a Microsoft engineer specializing in security
issues, claims she was told during her May 2012 performance review that she’d
had an outstanding year, and on a scale of 1 t
o 5 she’d earned the second-
highest rating, a 2—but because the number of employees who can get top
ranks is capped, she g
ot a 3 instead. The same thing hap
pened in 201
3. She left
in 201
4 and sued in 2015, alleging she was passed over for promotion in favor
of less qu
aliied men and was paid less than her male peers.
② THE LAWSUIT
Moussouris and her lawyers sought class-action status on
behalf of 8,000 women on the grounds that all were routinely discriminated
against at Microsoft
. The plaintifs got a boost when U.S. District Judge James
Robart ruled they could seek evidence fromMicrosoft. What the lawyers found
gave them high hopes—for instance, according to one of the plaintifs’ expert
witnesses, women at the company earn a “statistically signiicant”
8.
6 per-
cent less than men. Microsoft denies discriminating on pay and promotions.
③ THE ISSUE
The plaintifs had to overcome one important hurdle: a 2011
Supreme Court case,
Wal-Mart Stores Inc. v. Dukes
. In a
5-
4 decision written by
the late Antonin Scalia, the court ruled that because thousands of low-level man-
agers were making the pay and promotion decisions, there wasn’t enough “com-
monality” among the plaintifs to justify a class. The Microsoft plaintifs believed
that corporate policies such as the forced ranking system were a big part of
the problem, making it an issue of corporate culture, not individual decisions.
④ THE RESULT
Robart ruled for Microsoft in July, citing the
Dukes
precedent.
The plaintifs, he wrote, “have not identiied a common mode of exercising dis-
cretion that pervades the entire company.” However, in late September, the
Ninth Circuit Court of Appeals agreed to review the decision to deny certiica-
tion. If the appeals court certiies the class, Microsoft will have to decide whether
to take the case to trial—where its alleged discrimination will get a public airing—
or settle and move on.
—Nocera is a business columnist for Bloomberg Opinion
○ CLASS IS IN?
In the wake of the
Dukes
decision,
there was talk that
the Supreme Court
had gutted class
actions. But they’ve
seen a resurgence,
in large part because
appeals courts aren’t
interpreting
Dukes
as
narrowly as business
would like, says
Robert Klonof, a
professor at Lewis &
Clark Law School.
○ THEN AGAIN…
How long will the
reprieve last? With
judicial vacancies
being rapidly filled
by conservative
jurists, class actions
may soon be a relic.
That would be a
shame. While there
have certainly been
frivolous or abusive
class actions, the suits
are a powerful tool to
right real wrongs.
80
ILLUSTRATION BY GEORGE WYLESOL
LAST THING
With Bloomberg Opinion
By Joe Nocera