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August 15, 2001
Employees, Shoppers Target Wal-Mart
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Wal-Mart may be America' department store of choice, but lately it's also the defendant of choice, according to the Arizona Republic.

By its own count, Wal-Mart was sued 4,851 times last year, or nearly once every two hours, every day of the year. Juries decide a case in which Wal-Mart is a defendant about six times every business day; Wal-Mart lawyers list about 9,400 open cases.

Many of those lawsuits come from the Arkansas-based retailer's own employees. Naturally, there is no shortage of lawyers to assist them; dozens across the United States now specialize in suing Wal-Mart, with many sharing documents and other information via the Internet.

One lawsuit comes from female employees who claim they were discriminated against when it came to promotions. This week, other employees filed a suit alleging that supervisors forced them to work off the clock.

Yet as popular as it may be to sue Wal-Mart, winning is no easy thing.

The Republic reports that Wal-Mart, which promotes itself as a down-home friendly business, is helping change the nature of corporate litigation by aggressively fighting many cases, even when it would be cheaper for the company to settle.

That runs counter to the strategy companies have used for generations: Settle quickly and cut your losses. Yet it appears to be paying dividends for Wal-Mart, which in the past five years has seen the pace of its lawsuits stabilize as potential plaintiffs and their lawyers opt not to sue after weighing the costs of fighting the retailer.

Insurance companies, drug makers and other frequently sued businesses have kept an eye on the retailer's legal tactics - and adopted some of them.

Wal-Mart says it settles claims for which it is liable and fights only the cases that lack merit.

"If we haven't done anything wrong, we owe our (employees) the strongest defense possible," says Robert Rhoads, head of the company's legal department.

Tom Harrison, publisher of Lawyers Weekly USA, a legal industry newspaper, says Wal-Mart's approach is risky because it could "alienate plaintiffs' lawyers, juries, judges and ultimately customers." But "the rewards are potentially great, too. Many eyes in the (legal) profession are watching Wal-Mart, and not just to see what's on sale."

For instance, plaintiffs' lawyers frequently complain that Wal-Mart makes it difficult for them to examine company papers that they are entitled to see. In 1999, a judge in Beaumont, Texas, threatened to fine Wal-Mart $18 million for withholding an internal study of parking-lot security sought by a woman who was abducted from a Wal-Mart lot and raped.

And yet, there are signs the retailer is adjusting its litigation policy. Analysts say that Wal-Mart recently has seemed to make it a point to appear reasonable, appealing fewer cases and publicizing examples of disputes it resolved.

To view the Arizona Republic story, click here.
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