Eastern District Refuses to Rely on Dukes to Kill Class Claims at Pleadings Stage of Sex Bias Lawsuit

Calibuso, et al. v. Bank of America Corp., et al., No. 10-CV-1413(JFB)(ETB) (E.D.N.Y. Sept. 27, 2012, Bianco, J.): The plaintiffs, on behalf of a Rule 23 putative class of financial advisors, claimed that Bank of America’s compensation and account distribution system had a disparate impact on women, in violation of the Equal Pay Act, Title VII of the Civil Rights Act, and various state laws. Bank of America moved to dismiss arguing primarily that the U.S. Supreme Court’s decision in Wal-Mart Stores, Inc. v. Dukes precluded the plaintiffs from challenging company policies that allegedly allow manager discretion to make discriminatory decisions. Judge Joseph F. Bianco denied the defendants’ motion to dismiss, and distinguished Dukes as a case where plaintiffs could not satisfy the commonality requirements under Rule 23(a) because the class claims in Dukes alleged that local managers exercised broad and subjective discretion absent a uniform policy. Contrarily, the plaintiffs in Calibuso alleged that specific employment practices—namely, the criteria of the compensation and account distribution systems—systematically favored male financial advisors. The court found that the plaintiffs’ allegations could satisfy the commonality requirement because, although there was some level of subjective decisionmaking involved, they alleged that the decisionmaking “operated under a general policy of discrimination.” Importantly, however, Judge Bianco emphasized that the court was not concluding that the case would ultimately satisfy the commonality requirements under Dukes; rather, the court was simply stating that the plaintiffs had pled a plausible claim and the defendants’ arguments were premature at that early stage in the litigation.

Thus, while Dukes still provides a favorable framework for defendants to defeat class certification in cases involving discretionary decisionmaking, it is not clear whether the Second Circuit will rely on Dukes to deny class certification in cases alleging a general policy of discrimination. In the interim, employers are cautioned against relying on Dukes in such cases at the pleadings stage, where plaintiffs need only plead that commonality is plausible.