Document ID: ./input/supremecourt_opinions/opinions/10pdf/10-277.pdf
Page Number: 15

Cite as:  564 U. S. ____ (2011) 

11 

Opinion of the Court 

Nor  is  there  anything  unusual  about  that  consequence:
The necessity of touching aspects of the merits in order to 
resolve  preliminary  matters,  e.g.,  jurisdiction  and  venue,
is a familiar feature of litigation.  See Szabo v. Bridgeport 
Machines,  Inc.,  249  F. 3d  672,  676–677  (CA7  2001) 
(Easterbrook, J.).

In  this  case,  proof  of  commonality  necessarily  overlaps
with  respondents’  merits  contention  that  Wal-Mart  en-
gages in a pattern or practice of discrimination.7  That is so 
because,  in  resolving  an  individual’s  Title  VII  claim,  the 
crux of the inquiry is “the reason for a particular employ-
ment  decision,”  Cooper  v.  Federal  Reserve  Bank  of  Rich-
mond,  467  U. S.  867,  876  (1984).    Here  respondents  wish 

—————— 

Perhaps the  most common example of considering a merits question 
at  the  Rule  23  stage  arises  in  class-action  suits  for  securities  fraud.
Rule  23(b)(3)’s  requirement  that  “questions  of  law  or  fact  common  to
class  members  predominate  over  any  questions  affecting  only  individ-
ual  members”  would  often  be  an  insuperable  barrier  to  class  certifica-
tion, since each of the individual investors would have to prove reliance
on  the  alleged  misrepresentation.    But  the  problem  dissipates  if  the 
plaintiffs  can  establish  the  applicability  of  the  so-called  “fraud  on  the 
market”  presumption,  which  says  that  all  traders  who  purchase  stock
in an efficient market are presumed to have relied on the accuracy of a 
company’s  public  statements.    To  invoke  this  presumption,  the  plain-
tiffs  seeking  23(b)(3)  certification  must  prove  that  their  shares  were 
traded on an efficient market, Erica P. John Fund, Inc. v. Halliburton 
Co.,  563  U. S.  ___,  ___  (2011)  (slip  op.,  at  5),  an  issue  they  will  surely
have  to  prove  again  at  trial  in  order  to  make  out  their  case  on  the 
merits. 

7 In  a  pattern-or-practice  case,  the  plaintiff  tries  to  “establish  by  a 
preponderance  of  the  evidence  that  . . .  discrimination  was  the  com-
pany’s  standard  operating  procedure[,]  the  regular  rather  than  the 
unusual  practice.”    Teamsters  v.  United  States,  431  U. S.  324,  358 
(1977);  see  also  Franks  v.  Bowman  Transp.  Co.,  424  U. S.  747,  772 
(1976).  If he succeeds, that showing will support a rebuttable inference
that all class members were victims of the discriminatory practice, and
will justify “an award of prospective relief,” such as “an injunctive order 
against  the  continuation  of  the  discriminatory  practice.”    Teamsters, 
supra, at 361.