The district court had a basis to conclude that claims for injunctive and declaratory relief predominated over monetary claims, even though many class members were no longer employed by the company--and despite the plaintiffs' demand for not only back pay but classwide punitive damages.

The 9th Circuit rejected arguments that the trial would be unmanageable because of the class's huge size, and unconstitutional because the company would be deprived of its constitutional right to defend individual pay and promotion decisions.

It determined that if the company were found liable of discrimination at the merits stage, the district court could employ a formula to determine the amount of back pay and punitive damages owed to the class members.

It also might use "test cases" to give the company a chance to defend some personnel decisions on the merits, with the results being subject to statistical analysis in order to support a classwide formula.

Finally, the 9th Circuit ruled in favor of Wal-Mart in upholding the district court's decision not to certify promotion claims brought by class members for whom there was no objective evidence of qualifications for and interest in promotions.

While achieving the same substantive outcome of the Feb. 6 decision, the new ruling reflects various changes.

o The 9th Circuit indicates that plaintiffs no longer employed when the suit was filed should not be part of the class for purposes of injunctive relief.

The district court had approved a class of all current and former female employees starting 300 days before the first EEOC charge was filed in 1999.

The 9th Circuit, however, ruled that the class should be all women still employed when the complaint was filed in June 2001.

The 9th Circuit remained "confident that the primary relief sought by these plaintiffs remains declaratory and injunctive in nature, notwithstanding their request to also be 'made whole' in a monetary sense to the full extent provided under Title VII."

o The 9th Circuit expanded upon its reasoning in response to concerns about manageability and due process.

Relying on Hilao vs. Estate of Ferdinand Marcos, 103 F.3d 767 (9th Cir. 1996), the 9th Circuit determined that although the district court's proposal to use a formula to compensate class members was "somewhat imperfect," it was not a reason to find that due process protections were violated, especially now at the pre-merits stage.

o The new decision contains numerous analytical refinements that make the decision superficially more compatible with U.S. Supreme Court law, and the trend in other circuits toward meaningful rigorous analysis of Rule 23 requirements.

In footnote 2 of the opinion, for example, the 9th Circuit acknowledged that district courts must (and not merely may) resolve facts needed for Rule 23 analysis, even if those facts go to the merits. Similar adjustments occur at other places.

Even with the removal of inaccurate pro-certification rhetoric, however, the 9th Circuit still accepted the opinion of the plaintiffs' expert, who used a "social framework analysis" to examine employment policies.

The 9th Circuit held that the expert's opinion satisfied the standard in Daubert vs. Merrell Dow Pharmaceuticals Inc., 509 U.S. 579 (1993), and that in a class-action context, disagreements with the experts' inferences did not mean the testimony could not be admitted as expert evidence to bolster plaintiffs' arguments on commonality.

Like the old ruling, the new decision contains a vigorous dissent, with the dissenting judge arguing that the changes to the majority's decision did not alter his belief that the class-certification order was unworkable, and that the class should not have been certified.

The dissent was especially critical of the contention that injunctive and declaratory relief predominated over monetary relief, calling the suggestion "risible."

The dissent argued that except for the wealthiest people, "billions of dollars are going predominately over words and solemn commands and promises about how to behave in the future."

The dissent also questioned the district court's management plan approved by the majority that would permit a bifurcated process and the use of a formula to determine punitive damages.

The dissent, however, asserted that both "phases of this plan are constitutionally defective because they are inadequately individualized," arguing there would never be an adjudication made by an Article III judge and jury because "Wal-Mart will never get a chance, for example, to prove to a jury that [Betty] Dukes was tried as a manager and did not perform well, or that [Edith] Arana did indeed steal time or at least that after a good-faith investigation Wal-Mart fired her for that nonpretextual reason."

Wal-Mart had filed a petition for rehearing en banc as to the Feb. 6 opinion before the full 9th Circuit. However, the Dec. 11 ruling renders that petition moot. The company likely will renew its petition.

The Dukes ruling is a plaintiff-friendly interpretation of Rule 23 that deepens the divisions in the federal circuits on the ability of employers to defeat nationwide class actions where plaintiffs seek far-ranging injunctive relief, coupled with requests for classwide punitive damages.