Gender bias class action certified against Costco

October 10, 2012 by

Costco employees who sued the retailer for gender bias will be able to proceed with their claims as a group.  U.S. District Judge Edward Chen in San Francisco certified a class, or group, of plaintiffs, seeking monetary relief that includes several hundred women employed since 2002 who have been subject to the Issaquah, Washington-based company’s system for promotion to management positions. Costco “offers numerous competing explanations for the observed gender disparity in promotions,” Chen said in yesterday’s ruling. “None of these explanations undermine the companywide nature of the challenged policies and their disparate effects.” 

Costco, the largest U.S. warehouse-club chain, was sued in 2004 for allegedly limiting promotions of female employees to assistant general manager and general manager by failing to post job openings. The company denies the claims.

The ruling injects new life into the lawsuit after Costco won a ruling last year voiding another judge’s decision to expand the complaint, originally filed by three women, to include hundreds. 

A federal appeals court in San Francisco ruled last year that lawyers for the Costco workers had to follow standards set by the U.S. Supreme Court in a June 2011 decision throwing out a gender-bias lawsuit against Wal-Mart involving potential claims for more than 1 million women. That case is known as Dukes v Wal-Mart

Lawyers for Costco workers went back to the trial court with a new proposal to limit the proposed class of employees to two management level positions — assistant general manager and general manager, according to Chen’s ruling.

They also targeted specific employment practices implemented companywide under the influence and control of top management at Costco, including a “tap-on-the shoulder appointment process” without applications or interviews, and a mandated lack of posting for open positions, Chen said. 

Chen set a tentative trial schedule. In the first stage, a jury would decide whether Costco discriminated against women. Chen then would decide whether Costco’s practices had an adverse impact on the group and if he should issue an injunction against the company.  Depending on the outcome, individual hearings on back pay and compensatory damages would be held and punitive damages would be determined.

Steve Larson
An experienced trial lawyer who handles both hourly and contingent fee cases, Steve has expertise in class actions, consumer cases, antitrust litigation, securities litigation, corporate disputes, intellectual property disputes, unfair competition claims, employment matters, and disputes involving family wealth. Steve regularly represents individuals and businesses in federal and state court and has obtained class-wide recovery in multiple class actions. A veteran practitioner, Steve's clients value his creative approach to resolving complex litigation matters.

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