Fast Company

The Next Big (Legal) Thing?

Brad Seligman is spearheading a lawsuit against America's largest private employer, charging it with discrimination against its female workers. Wal-Mart never bargained for this.

It's the world's largest retailer and this country's largest private employer. And Wal-Mart tops another category as well: It faces more lawsuits than any other company in the United States -- some 5,000 in 2000, according to USA Today. Brad Seligman has only one suit against Wal-Mart, but it is by far the most significant. If he's successful, he could dramatically change the company that Sam Walton built. In fact, that's the plan.

Seligman is the lead attorney on a sex-discrimination class action against Wal-Mart. The suit alleges that Wal-Mart systematically mistreats its women in a variety of ways. It says that women at Wal-Mart often earn less than their male counterparts, even though women may have more experience or outrank men. It also says that Wal-Mart prevents women from advancing by denying them training, prohibiting them from working in departments that are traditionally staffed with men (which often pay more), and not posting all management openings, undermining women's ability to apply. The result, says Seligman, is a company in which women make up more than 70% of hourly sales employees but just 10% of store managers. Wal-Mart denies the allegations. "We have said from the beginning that we have a strict antidiscrimination policy, so it would be against company policy to discriminate against women or anybody else," says Bill Wertz, a spokesman at headquarters in Bentonville, Arkansas. "That's what is at issue: whether we're implementing our policy properly."

If Dukes v. Wal-Mart Stores wins class certification in July, the class action would consist of more than 700,000 current and former female employees -- that's roughly the population of San Francisco -- and would be the largest employment-discrimination case ever filed. For a civil-rights attorney, it's the case of a lifetime. And it's a case that Seligman has been preparing for his entire career. He's one of the most experienced attorneys in the country at putting together class actions. For years, they were his specialty at a private firm in Oakland, where he filed a series of suits against grocery-store chains. He negotiated multimillion-dollar settlements that improved working conditions for female and African-American employees at stores across the country.

Since then, he's been something of a legal entrepreneur. He runs the Impact Fund, a nonprofit group in Berkeley that supports litigation related to civil rights and human rights, the environment, and poverty. Federal class-action filings are down 90% from the mid-1970s, due to stricter legal requirements, escalating costs, and the fact that federally funded lawyers can no longer file them. Since its inception in 1992, the Impact Fund has given more than $3 million to private firms and public-interest groups. According to Seligman, it's still the only nonprofit that subsidizes class-action litigation through such grants.

PERSONNEL 101

The Wal-Mart suit is a chance for Seligman to make his biggest impact yet. "This is an opportunity to take the industry leader in discrimination and turn it into the leader in fairness," he says. In a study commissioned by Seligman, economist Marc Bendick argues that Wal-Mart is woefully behind the times in promoting women. At Wal-Mart's top 20 competitors, the study says, 56% of managers are women, compared with about a third of that percentage at Wal-Mart. "This is the sort of case I would have expected to see 20 years ago," says Seligman. "It's Personnel 101 stuff." For its part, Wal-Mart says that the comparison isn't valid. "It isn't necessarily comparing apples to apples," says Wertz. "There are many ways to cut those numbers."

One of the first skirmishes in the suit involved where the case would be tried. When Wal-Mart requested a change of venue from a California federal court to its home state of Arkansas, the judge refused.

The Wal-Mart suit could have a big effect on how other potentially unwieldy cases are handled. The plaintiff's team represents an unusually large coalition: three private law firms and three public-interest groups. Seligman acts as lead counsel. "In the traditional model, a private firm puts up most of the money and takes control of the case," he explains. "In the new model, it's more collaborative. The nonprofit that knows the issues and has grassroots connections maintains a larger role. Everyone has a seat at the table, but ultimately, I'm the tiebreaker."

Seligman is leading a team of 18 lawyers from six groups in five cities. Thanks to an intranet site, the partners operate much like a single firm, filing depositions and reviewing documents online. Part of Wal-Mart's strategy, says Jocelyn Larkin, the Impact Fund's other litigator, is to bury the opposition in paperwork. "We just got the millionth page of documents today," she says. "They're not close to being done. We'll probably have 2 million pages by the time they're done."

REVOLUTIONARY FERVOR

Back when Seligman was a teenager, becoming a lawyer seemed improbable, although his father had been a lawyer early in his career and worked on the Nuremberg trials as a junior prosecutor. "In many ways, I was raised to be a lawyer," says Seligman. "But I was very skeptical about the career path laid out for me."

He dropped in and out of college, preferring to enjoy the hippie life, play guitar, and attend protests. "I've always had a commitment to social change," says Seligman, whose Berkeley office features a 1960s student-protest poster near his desk. "In my youth, I thought it could happen through demonstrations. I still believe they can be useful. But you need more than that."

He learned to use the law -- class-action litigation, specifically -- as a tool for social change. His biggest victory was a discrimination suit in the early 1990s against Lucky Stores, a chain of supermarkets that has since been acquired by Albertson's. At the time, the $107 million settlement was the third-largest ever reached in a sex-discrimination class action. More important, as part of the settlement, the company had to stop pigeonholing women into low-paying jobs and start providing them with more opportunities to advance. Five years later, Seligman says, Lucky had doubled the percentage of women in store management. Says Steve Stemerman, an attorney at San Francisco firm Davis, Cowell & Bowe, who is on the Wal-Mart team: "Unlike a certain segment of plaintiffs' attorneys who are out to take the money and run, Brad is more interested in making change. With Lucky, he created a basic fairness that benefited not just the people represented in the class action but the entire workforce."

Seligman did, as it turns out, take his cut of the $12 million attorney's fees from the Lucky settlement and run, but he did so to start the Impact Fund. "It was embarrassing for an old revolutionary to have that much money," he admits.

For the time being, Seligman remains focused on Wal-Mart. Demonstrating that discrimination permeates the chain is a considerable challenge. But given what he says he has learned about Wal-Mart so far, Seligman is feeling confident. "Wal-Mart is a uniquely centralized company," he says. "It has a command-and-control system, which is important in class-action law. You need to show uniformity and common treatment of people, that what happens in Florida is similar to what happens in Oregon."

Another key is being ready to go to trial. It sounds obvious, but some lawyers assume that a company will cave from bad publicity. The majority do settle. But Wal-Mart has a reputation for aggressively fighting cases. Seligman says that suits him fine. "I imagine there will be settlement discussions," he says, "but Wal-Mart will know that we are prepared to go to trial. We are determined to take them someplace they don't want to go."

Chuck Salter is a Fast Company senior writer based in Baltimore. Contact Brad Seligman by email (bseligman@impactfund.org).

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