Why Walmart Will Cringe at the $250M Novartis Sex Discrimination Case

Last Updated May 19, 2010 3:13 PM EDT

UPDATE: Who's Going to Get What in the $250M Novartis Sex Discrimination Verdict Management at Walmart (WMT) will groan in dismay at the $250 million punitive damages award won by female employees of Novartis (NVS) in a New York federal court today. Walmart is next on the docket of major corporate gender discrimination class action cases.

A jury found Novartis unfairly treated its female employees by not promoting them as much, discriminating against workers who got pregnant, and most infamously threatening a female drug sales rep after she reported to HR that was raped by one of her customers.

The key thing for Walmart is that the Novartis case was the first ever class action sex discrimination case to go to trial, according to a representative of the lawyers who won the suit. The previous big cases all settled before they reached a verdict. Those include Sanofi-Aventis (SNY) (a $15 million deal) and Home Depot (HD) (a $104 million deal.)

It wasn't at all clear prior to this case that juries would be so financially sympathetic to the women (although lying to the police during the rape investigation was clearly the killer blow for Novartis). As such, the price of settling was apparently at least a 50 percent discount on the price of losing at trial.

Unfortunately for Walmart, the plaintiffs there now know to ask for roughly double what they thought they could get before this morning. That sum could be enormous: Although the Novartis case affects 5,600 women, Walmart is the largest employer in the U.S. -- possibly the world -- and its case is the largest discrimination case ever: There are 1.6 million women in the class.


Gavel image via Flickr user Thomas Roche, CC 2.0.