Twitter to Channel Walmart Legal Victory in Discrimination Suit

(Bloomberg) -- Twitter Inc. wants to be seen as just another Walmart Inc. In court, at least.

The social-media company, seeking to block female software engineers from banding together to sue it for gender bias, is aiming to sail in the wake of a 2011 U.S. Supreme Court decision that handed Walmart a victory against a group of women suing for the same reason.

Despite corporate lawyers’ success in wielding the landmark Walmart decision to their advantage, some employment experts say the Twitter case is different enough that there’s a good chance a California judge will certify it as a class action -- in what would be the first group case of its kind in the technology sector. Either way, the ruling will signal whether a movement that has revealed widespread bias at technology companies can gain traction in courts, and give women tools under the law to do something about it.

‘Disparate Impact’

In the Walmart case, 1.5 million female workers claimed company policies led to unfair pay and promotion outcomes compared with their male peers. The nation’s highest court decided that employment practices at the world’s largest retailer were so decentralized -- and the company so big -- that they couldn’t be the result of systemwide discriminatory intent, even if they resulted in a “disparate impact” on women.

In Twitter’s case, 135 current and former female engineers want to sue as a group, claiming the company thwarts their advancement. The lawsuit was filed in 2015 by Tina Huang, who has gathered data on advancement and compensation for her peers to illustrate systemic discrimination rather than detail individual treatment.

California Superior Court Judge Mary E. Wiss in San Francisco will hear arguments Wednesday.

Awareness of Silicon Valley’s attitudes toward women has grown just as the #MeToo movement calling out sexual harassment in Hollywood and elsewhere has ballooned. A cluster of recent events in the tech world sums up the landscape: Uber Technologies Inc. was pilloried over its toxic culture last year after former engineer Susan Fowler described it in a blog post, a Google engineer authored a memo explaining women’s biological inferiority to men and Microsoft Corp. faces its own gender discrimination suit.

Silicon Valley

Those developments have focused public attention on whether tech is generally hostile to women, said Charlotte Garden, a law professor at Seattle University. She thinks Huang will probably win certification.

“Even though certification is just the first step, a victory for the plaintiff at that step could ripple through Silicon Valley,” she said. Such a decision “could have a galvanizing effect” for those who look around their workplaces and see that some groups are underrepresented in the ranks of management, she said.

Twitter said in an emailed statement that it “disputes the meritless claims made in this case, and in the motion for class certification.”

“We are deeply committed to an inclusive and diverse workplace, and to the fair and equitable treatment of all our employees,” the company said.

Dueling Data

Huang is relying on a December 2017 report she commissioned by an economist and statistician at San Francisco State University that shows female engineers at Twitter are promoted at a lower rate, remain stuck in lower positions longer and are almost absent from senior ranks.

The proportions are “extremely unlikely to occur due to chance,” Huang said in a court filing, citing the report.

Twitter is asking Judge Wiss to pay special attention to the Walmart case, brought by women claiming they were victimized by the company’s practice of letting local managers make subjective decisions about pay and promotions. The high court set a new, higher standard for certifying class actions by concluding the plaintiffs failed to prove the retailer had a nationwide policy that led to gender discrimination.

The social media company gives wide discretion to “hundreds of managers and promotion committee members to make promotion decisions,” much like Walmart, the company said in a court filing.

Twitter argues it has more than 3,500 employees, about 850 of them software engineers, in 35 offices worldwide. Under such varied decision-making, Twitter says, the group Huang wants to represent can’t prove a common experience of discrimination required to make it a class action. By way of comparison, Walmart has more than 2 million employees.

“The discretion Twitter affords to managers in the promotion process forecloses any finding of commonality,” according to the filing.

Twitter also argues Huang’s expert report is “chock full of errors.” Its own expert, a labor economist at Resolution Economics in Washington, found “no statistically significant disparity existed between the time to promotion between men and women.”

Tristin Green, a professor at University of San Francisco School of Law who specializes in employment discrimination, said Judge Wiss is “likely to see through” Twitter’s Walmart argument and certify Huang’s suit. The proposed class in Twitter would amount to a small fraction of the group who sued Walmart, she said, and the engineer plaintiffs are more focused in their jobs on specific processes.

The legal theory Huang is relying on -- showing systemic discrimination -- is a smart tactic to win certification but may also make the case more difficult to win if it doesn’t settle, Green said.

After certification, the burden of the case would shift to Twitter, which will probably argue that the way it goes about promotions is important to how it does business, Green said. At that stage, she said, research shows courts tend to defer to employers because they’re reluctant to interfere in business decisions.

“If Twitter can show its decision-making system is important to its business, it might avoid liability,” Green said.

Huang’s lawyer, Jason Lohr, said he thinks that standard may have changed.

“If you had told me two years ago that Charlie Rose or Travis Kalanick would lose their jobs because of the #MeToo movement, I would’ve thought that unlikely,” he said. “While that may be the case historically,” he said, referring to courts’ deference to corporate decision-making, “the law changes with the times.”

Bloomberg LP produces TicToc, a global breaking news network for the Twitter service.

The case is Huang v. Twitter Inc., CGC-15-544813, California Superior Court (San Francisco).

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net.

To contact the editors responsible for this story: Elizabeth Wollman at ewollman@bloomberg.net, Peter Blumberg

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