Court Opinion

ID: 8411534
Source: CourtListenerOpinion
Date Created: 2022-11-02 19:01:32.194753+00
Date Added: 2024-06-11T16:47:51.990653
License: Public Domain

GRABER, Circuit Judge,
concurring:
The majority and the dissent have written scholarly and complete explanations of them positions. What the length of their opinions may mask is the simplicity of the majority’s unremarkable holding:
Current female employees may maintain a Rule 23(b)(2) class action against their employer, seeking injunctive and declaratory relief and back pay on behalf of all the current female employees, when they challenge as discriminatory the effects of their employer’s company-wide policies.
If the employer had 500 female employees, I doubt that any of my colleagues would question the certification of such a class. Certification does not become an abuse of discretion merely because the class has 500,000 members.
I therefore concur fully in the majority opinion.
IKUTA, Circuit Judge,
with whom Chief Judge KOZINSKI and Judges RYMER, SILVERMAN, and BEA join, dissenting:
No court has ever certified a class like this one, until now. And with good reason. In this case, six women who have worked in thirteen of Wal-Mart’s 3,400 stores seek to represent every woman who has worked in those stores over the course of the last decade — a class estimated in 2001 to include more than 1.5 million women. According to the plaintiffs’ theory, Wal-Mart has a corporate policy of discrimination which it implements through the discretionary decisions of store managers, resulting in class-wide injury in violation of Title VII of the Civil Rights Act of 1964.
But while the six plaintiffs allege they have suffered discrimination at the hands of a few individual store managers, they fail to present “[significant proof’ of a discriminatory policy or practice of WalMart that would make it possible to conclude that 1.5 million members of the proposed class suffered similar discrimination. See Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 159 n. 15, 102 S.Ct. 2364, 72 *629L.Ed.2d 740 (1982). Without evidence of a company-wide discriminatory policy implemented by managers through their discretionary decisions, or other evidence of a discriminatory company-wide practice, there is nothing to bind these purported 1.5 million claims together in a single action. See id. at 158-59, 102 S.Ct. 2364.
Then there is the problem of individual hearings. Under Title VII, Wal-Mart has the right to raise affirmative defenses as to each class member’s claim. This means the court must allow up to 1.5 million individual determinations of liability. On its face, a class action of this sort makes no sense.
In certifying the class despite these obstacles, the district court abused its discretion. In affirming most of the district court’s determinations, the majority compounds the error, and creates a precedent for class action suits that departs from the language and intent of Rule 23 of the Federal Rules of Civil Procedure, ignores Supreme Court mandates, and neglects the rights of defendants. I respectfully dissent.
I
A brief review of the facts highlights the obstacles to certifying this class. WalMart is the largest private employer in the world, Dukes v. Wal-Mart Stores, Inc. (Dukes I), 222 F.R.D. 137, 141 (N.D.Cal. 2004), and the largest retail chain in the United States. At year-end 2001, when this suit was filed, Wal-Mart employed over 930,000 retail employees in hundreds of different jobs at roughly 3,400 stores nationwide.
Wal-Mart’s corporate structure is complex. The company divides its retail operation into seven divisions, six for WalMart and one for Sam’s Club.1 Those divisions are split into 41 separate regions, each of which is overseen by a regional vice president. The regions are further divided into roughly 400 individual districts, which are headed by district managers. Each of Wal-Mart’s regions consists of 80 to 85 stores, with Wal-Mart employing anywhere from 80 to 500 people per store.
Individual stores are run by store managers who are responsible for hiring and promoting the hourly employees in their respective stores. At each store, assistant managers report to store managers; these management positions are salaried, and employees may be promoted to these positions after first working as entry-level, non-salaried management trainees. WalMart’s retail employees work hourly in 53 different departments and 170 different job classifications; these positions include cashiers, associates, team leads, and department managers.
Wal-Mart gives its managers substantial discretion in both pay and promotion decisions. Store managers make pay decisions for hourly employees, subject only to a general pay structure. Id. at 146. Store managers “are allowed to depart from the minimum start rates, within a two dollar per hour range, without being constrained by objective criteria and with limited oversight.” Id. at 146^17. Wal-Mart also allows store managers to increase pay for exceptional performance. Id. at 147. District managers set the pay for salaried employees. They have “discretion to set pay rates with little guidance and limited oversight.” Id.
Managers likewise have substantial discretion in making promotion decisions. Wal-Mart has corporate guidelines re*630garding entrance requirements for its management trainee program, but individual store managers may apply their own subjective criteria in selecting employees who will be invited to enter the program. Id. at 148. Decisions regarding advancement into the highest store-level managerial positions (assistant manager, co-manager, and store manager) are “similarly based on subjective assessments beyond adherence to corporate minimum guidelines.” Id. Discretion is “further compounded by the fact that the company does not monitor the promotion decisions being made or otherwise systematically review the grounds on which candidates are selected for promotion.” Id. at 149.
This action was brought by six women on behalf of all women who were employed in any retail store position throughout Wal-Mart. Two of these six women still work at Wal-Mart. Of the other four, one was terminated,2 and three left Wal-Mart before the complaint was even filed.3 In the aggregate, these six plaintiffs worked at ten stores in California, one store in Texas, one store in Oklahoma, and one store in Missouri. Three plaintiffs allege that they expressed interest in, or applied for, various promotions at the store in which they were then employed, but did not receive them. These three women allege that men were promoted instead. Only one of these plaintiffs, Christine Kwapnoski, has held a management position. Two plaintiffs allege that similarly situated men received higher pay. One plaintiff alleges that a less-qualified man received the same pay as she did.
Together, these six women assert that they are adequate class representatives of a class comprising “[a]ll women employed at any Wal-Mart domestic retail store at any time since December 26, 1998 who have been or may be subjected to WalMart’s challenged pay and management track promotions policies and practices.” Id. at 141-42. The class includes every woman working in Wal-Mart’s retail stores, which by definition encompasses salaried store managers who were responsible for the allegedly discriminatory hiring decisions,4 assistant managers and co-managers who were also responsible for much of the alleged discriminatory treatment, and hourly workers whose in-store positions range from personnel clerk to deli manager. At the time the suit was filed, the class was estimated to include 1.5 million women.5
*631II
Before it can certify a class, a court must ensure that the proposed class meets the standards set forth in Rule 23 of the Federal Rules of Civil Procedure. Rule 23 is a procedural rule that permits courts to aggregate the legal claims of multiple parties when it is efficient and fair to do so.6 It does not alter the substance of claims or the plaintiffs’ burden to prove their claims. See 28 U.S.C. § 2072(b).
We review the district court’s class certification decisions for abuse of discretion. Staton v. Boeing Co., 327 F.3d 938, 953 (9th Cir.2003). Abuse of discretion occurs when the district court commits a legal error, or when it “relies upon an improper factor, omits consideration of a factor entitled to substantial weight, or mulls the correct mix of factors but makes a clear error of judgment in assaying them.” Vinole v. Countrywide Home Loans, Inc., 571 F.3d 935, 939(9th Cir.2009) (citation and internal quotation marks omitted).
Here, the district court abused its discretion in two ways. First, it failed to follow the Supreme Court’s direction to “evaluate carefully the legitimacy of the named plaintiffs plea that he is a proper class representative under Rule 23(a),” Falcon, 457 U.S. at 160, 102 S.Ct. 2364, and to ensure “after a rigorous analysis” that the prerequisites of Rule 23(a) have been met, id. at 161, 102 S.Ct. 2364. Second, the district court erred in ignoring Wal-Mart’s statutory right to raise defenses to liability for back pay and punitive damages under Title VII, see 42 U.S.C. § 2000e-5(g)(2); Rules Enabling Act, 28 U.S.C. § 2072(b), and therefore abused its discretion in holding that the proposed class could be certified under Rule 23(b)(2). I would reverse and remand this action to the district court to correct these errors, which I address below in turn.
A
In Falcon, the Supreme Court held that when a small number of plaintiffs allege company-wide discrimination and attempt to certify a company-wide class, the district court must undertake a “rigorous analysis” to determine whether the Rule 23(a) commonality and typicality factors exist.7 Falcon, 457 U.S. at 157, 161, 102 S.Ct. 2364; see Staton, 327 F.3d at 953-54(calling a proposed class of 15,000 members throughout six facilities an “ambitious” claim for commonality that was “therefore especially worthy of scrutiny”). As Falcon explained, the plaintiffs own experience of discrimination does not allow the district court to infer that “discriminatory treatment is typical of [the employer’s employment] practices.” 457 U.S. at 158, 102 S.Ct. 2364; see E. Tex. Motor Freight *632Sys., Inc. v. Rodriguez, 131 U.S. 395, 403-04, 97 S.Ct. 1891, 52 L.Ed.2d 153 (1977). Indeed, the Court warned, “if one allegation of specific discriminatory treatment were sufficient to support an across-the-board attack, every Title VII case would be a potential company-wide class action. ” Falcon, 157 U.S. at 159, 102 S.Ct. 2361. Instead, to maintain a company-wide class action based on discrimination, the plaintiff must bridge the “wide gap” between: (1) the plaintiff’s own discriminatory treatment; and (2) the existence of a class that has suffered the same injury as the plaintiff as a result of a company-wide discriminatory policy. Id. at 157, 102 S.Ct. 2364.
This principle is simple common sense. A female employee in a store in California, for example, may have a valid claim that her supervisor discriminated against her when making decisions regarding promotion opportunities. But this individual claim would not by itself entitle the California employee to bring the alleged discrimination claims of female employees in a store in Wyoming. Absent evidence that the Wyoming employees had been subject to the same sort of discrimination and could bring the same sort of claims, such a proposed class would clearly fail the Rule 23(a) commonality and typicality requirements. A fortiori, a female employee in California could not represent a class of all female employees in Wal-Mart absent similar proof to bridge the gap between her claim and the existence of company-wide discrimination.
The Supreme Court has identified two situations in which a plaintiff could potentially bridge this gap. The first is where a plaintiff alleges that an employer “used a biased testing procedure” to evaluate all members of the proposed class. Id. at 159 n. 15. This makes sense because if the employer used a biased testing procedure throughout the company, then every employee subject to the test would have a similar claim.
The Court’s second example applies directly to this case: a plaintiff “conceivably” could bring a company-wide Title VII action if the plaintiff adduced “[significant proof that an employer operated under a general policy of discrimination” and the discriminatory policy was implemented through “entirely subjective decision making processes” in a manner that affected all members of the class. Id. This example also makes sense. As the majority acknowledges, Maj. Op. at 612, subjective decision making by itself is not a discriminatory practice. See Watson v. Fort Worth Bank & Trust, 487 U.S. 977, 988, 990, 108 S.Ct. 2777, 101 L.Ed.2d 827 (1988) (“It is true, to be sure, that an employer’s policy of leaving promotion decisions to the unchecked discretion of lower level supervisors should itself raise no inference of discriminatory conduct.”). But if an employer has a company-wide policy of discrimination against women, and the employer implements this policy through company-wide subjective decision making, then the plaintiff could reasonably claim that all female employees were subject to the same discriminatory employment practice. As in our prior example, if the female employee in the California store could offer proof of a company-wide policy of discrimination against women, she would be able to allege that female employees in stores throughout the country suffered a similar discriminatory injury as she did.
Although Falcon did not spell out what constitutes “significant proof’ of the existence of a general policy of discrimination, it did make one thing clear: Evidence of discrete instances of discrimination are insufficient to sustain an inference of an employer’s general policy and do not rise to the level of “significant proof.” See 457 *633U.S. at 158, 102 S.Ct. 2364(holding that evidence that the plaintiff “was passed over for promotion when several less deserving whites were advanced” may support a claim of individual discrimination, but “would not necessarily justify” a company-wide claim of discrimination). This is the standard that must be applied to the claims here.
B
The majority offers several reasons for concluding it is not bound by Falcon’s “significant proof’ requirement. First, the majority claims that this requirement has little weight because it was a “hypothetical in clear dicta.”8 Maj. Op. at 595 n.15. This contention has no merit. We are bound by the Supreme Court’s instructions whether they are stated in the first sentence of an opinion or in the final footnote. Falcon’s analysis of Rule 23(a) is controlling here, given that it is the sole Supreme Court case addressing Rule 23(a) in the Title VII discrimination context and is directly on point in this case. Moreover, the significant proof requirement is clearly a reasonable interpretation of Rule 23(a); a plaintiff cannot bring a company-wide discrimination class action unless there is sufficient evidence that the alleged discriminatory injury actually affected employees throughout the company.
Second, the majority attempts to cabin Falcon to its facts, asserting that the “significant proof’ requirement applies only when the plaintiff is an employee of the company and other members of the purported class are job applicants. In such a case, the majority asserts, the plaintiff and the purported members of the class have “distinct legal theories of recovery.” Maj. Op. at 595. The majority’s efforts to distinguish Falcon on this ground are unpersuasive. Falcon’s determination that the district court erred in certifying a class of existing employees and job applicants was based on the general principle that a plaintiffs claims must “fairly encompass” those of the class to meet the Rule 23(a) commonality and typicality requirements. See Falcon, 457 U.S. at 156, 102 S.Ct. 2364. In elaborating further on this principle, the Supreme Court explained that plaintiffs who seek to bridge the gap between their claims and those of the class members by alleging a general company-wide policy of discrimination must adduce “significant proof’ that such a policy exists. Id. at 159 n. 15, 102 S.Ct. 3014. The Supreme Court did not limit this principle to classes combining plaintiffs with hiring and promotion claims.
Finally, the majority claims that Falcon’s “significant proof’ requirement conflates the class certification and merits phases of the litigation. Maj. Op. at 596 n.17. This is incorrect. Falcon does not require plaintiffs to prove the merits of their claim; here, for example, plaintiffs need not establish a prima facie case of discrimination that can survive the employer’s rebuttal evidence, nor need they prove their claims for individual relief. See Int’l Bhd. of Teamsters v. United States, 431 U.S. 324, 360, 97 S.Ct. 1843, 52 L.Ed.2d 396 (1977). But Falcon does require the plaintiffs to put forth some significant proof, i.e., evidence beyond al*634legations, that a general policy of discrimination exists. Falcon, 457 U.S. at 159 n. 15, 102 S.Ct. 2364. More important, as Falcon states (and as the majority acknowledges), courts at the class certification stage must “probe behind the pleadings” to examine evidence which goes to the requirements of Rule 23, even if such evidence also relates to the underlying merits of the case. Id. at 160, 102 S.Ct. 2364. In this context, the degree of overlap between the merits determination and the determination that the class meets the Rule 23 requirements is largely irrelevant. Id. Rather, Falcon’s principle that a handful of individual incidents of discrimination are insufficient for class certification is applicable both at the merits stage and the class certification stage. See Cooper v. Fed. Reserve Bank, 467 U.S. 867, 876-77, 104 S.Ct. 2794, 81 L.Ed.2d 718 (1984). If plaintiffs cannot demonstrate that the proposed class was subject to a general policy of discrimination, then the class action is not an efficient mechanism for pursuing relief, and the district court may not certify the class.
C
We must consider plaintiffs’ motion for class certification under Rule 23(a) in light of Falcon’s requirements. In this case, the plaintiffs asked the district court to certify a class of 1.5 million women based on: (i) 120 anecdotes; (ii) statistical evidence; and (iii) expert testimony.9 In light of Falcon, the district court’s responsibility to conduct a rigorous scrutiny of this evidence was clear. As explained below, the evidence does not come close to meeting the Falcon requirements for demonstrating commonality and typicality.
1
On its face, 120 anecdotes, or one anecdote for every 12,500 class members, does not support plaintiffs’ claim that Wal-Mart had a company-wide policy of discrimination. The affidavits describe the affiants’ experiences in, at most, 235 of Wal-Mart’s 3,400 stores, meaning that the affidavits provide no information about working conditions in over 3,100 stores. A single affidavit from a single store in Michigan tells little about whether there is discrimination at each of the other 72 stores in Michigan, let alone the rest of the company. Cooper, 467 U.S. at 877-78, 104 S.Ct. 2794; see Cooper v. S. Co., 390 F.3d 695, 714-15 (11th Cir.2004) (holding that evidence of discrimination in one part of a company does not necessarily give rise to an inference of discrimination in a different part of the company), overruled on other grounds by Ash v. Tyson Foods, Inc., 546 U.S. 454, 457-58, 126 S.Ct. 1195, 163 L.Ed.2d 1053 (2006) (per curiam).
Nor are the 120 affidavits geographically representative of Wal-Mart as a whole. See Cooper, 390 F.3d at 719(upholding the district court’s determination that, “given the sheer size and geographically dispersed nature of the defendants’ workforce, the anecdotal evidence — disturbing as some of it may have been — was inadequate to establish discrimination class-wide”). Here, more than half of the 120 women who submitted affidavits are concentrated in only six states — Alabama, California, Florida, Missouri, Texas, and *635Wisconsin — -where less than a third of Wal-Mart stores are located. There are no more than one or two affidavits relating to Wal-Mart operations in half the states, and 14 states are not represented at all.10
The Supreme Court has held that a court may find a company-wide policy of discrimination where plaintiffs have offered a substantial number of affidavits compared to the size of the class, along with sufficient statistical evidence.11 Teamsters, 431 U.S. at 339, 97 S.Ct. 1843. In Teamsters, for example, 40 anecdotes of discrimination out of a class of some 334 employees (one out of every eight class members) were held probative of a pattern or practice of discrimination. See United States v. T.I.M.E.-D.C., Inc., 517 F.2d 299, 308 (5th Cir.1975), overruled by Teamsters, 431 U.S. 324, 97 S.Ct. 1843, 52 L.Ed.2d 396. These 40 anecdotes were from employees spread throughout the company and represented seven of the company’s ten largest operations. See id. at 315 & n. 30.
On the other hand, the Supreme Court has concluded that a handful of discriminatory incidents is insufficient evidence of a company-wide policy of discrimination to justify certification of a company-wide class. Falcon, 457 U.S. at 159, 102 S.Ct. 2364. A plaintiffs individual experience of discriminatory treatment does not itself raise the inference that such treatment is typical of the employer’s practices. Id. at 158, 102 S.Ct. 2364; see Cooper, 467 U.S. at 877-78, 104 S.Ct. 2794 (“[A] class plaintiffs attempt to prove the existence of a company-wide policy, or even a consistent practice within a given department, may fail even though discrimination against one or two individuals has been proved.”).
Here, 120 affidavits compared to 1.5 million members of the class amount to nothing more than evidence of “isolated or sporadic” incidents of discrimination, Cooper, 467 U.S. at 876, 104 S.Ct. 2794, which are insufficient to show a company-wide policy of discrimination. See Falcon, 457 U.S. at 159, 102 S.Ct. 2364. The affiants claim discrimination in different forms, at the hands of different people, in different stores, in different parts of the country, at different times, and under a constellation of facts unique to each individual. Whether or not these 120 employees have actionable discrimination claims against the store and management where they worked, their individual stories do not constitute significant proof that Wal-Mart has adopted a general policy of discrimination or that such a policy prevails in the remaining 3,100 stores. In relying on such scanty anecdotal evidence to support class certification, the district court failed to “probe behind the pleadings” to determine *636whether the six plaintiffs actually did “possess the same interest and suffer the same injury” as the proposed class members. Id. at 160, 102 S.Ct. 2364.
The majority makes the same mistake. Discarding Wal-Mart’s objection that the district court abused its discretion in considering the 120 affidavits to be an adequate basis for certifying the class, the majority states, “we find no authority requiring or even suggesting that a plaintiff class submit a specific number of declarations for such evidence to have any value.” Maj. Op. at 610. This is a strawman argument. The Supreme Court has not specified a threshold number of affidavits that a plaintiff alleging company-wide discrimination must have in hand. But if the plaintiffs affidavits do not raise the inference that the employer’s practices are “motivated by a policy of [gender] discrimination” pervading the employer’s company, they do not support class certification. Falcon, 457 U.S. at 158, 102 S.Ct. 2364. Here, the majority’s conclusion that one declaration for every 12,500 women, amounting to a handful of declarations scattered among 3,400 stores in fifty states, “raise[s] an inference of common discriminatory experiences,” Maj. Op. at 611, does not pass even the straight-faced test.
2
The plaintiffs’ statistical evidence is no better. Plaintiffs relied most heavily on the statistical study produced by Dr. Richard Drogin, a retired professor of statistics from California State University, Hayward. Drogin conducted a regional analysis comparing the percentage of women promoted into management positions at Wal-Mart with the percentage of women in the available pool of hourly workers, and concluded that women were underrepresented in management in almost every one of Wal-Mart’s 41 regions. Drogin also compared the earnings of women to the earnings of men at Wal-Mart and concluded that in each region, Wal-Mart pays women less than men in comparable hourly positions.
Wal-Mart objected to this evidence on the ground that data aggregated at the regional or national level did not demonstrate there was a general policy of discrimination throughout Wal-Mart’s 3,400 individual retail stores. The district court dismissed these objections. Rejecting what it characterized as Wal-Mart’s effort “to engage the Court in a merits evaluation of the expert opinions,” the district court stated it would “delve[] into the substance of the expert testimony only to the extent necessary to determine if it is sufficiently probative of an inference of discrimination to create a common question as to the existence of a pattern and practice of gender discrimination at WalMart.” Dukes I, 222 F.R.D. at 155. Applying this standard, the court held that Drogin’s regional analysis was not “lacking in probative value,” was “at least a reasonable means of conducting a statistical analysis,” id. at 159, and therefore was sufficient to “create an inference of discrimination” for class certification purposes, id. at 164.
The district court’s superficial examination of Drogin’s statistics constituted legal error. The plaintiffs’ class proposal hinged on its proof that Wal-Mart had a general policy of discrimination; absent convincing proof on that point, the plaintiffs could not bridge the gap between their discrimination claims and the purported claims of the class. Accordingly, the district court was obliged to scrutinize plaintiffs’ evidence and make a reasoned determination as to whether it constituted significant proof that Wal-Mart had a general policy of discrimination, and thus *637whether the requirements of Rule 23(a) had been met. See Falcon, 457 U.S. at 161, 102 S.Ct. 2364.
The district court expressly rejected this responsibility. Instead of rigorously analyzing whether the plaintiffs’ evidence was significant proof of a general policy of discrimination, the district court made it Wal-Mart’s burden to prove that Drogin’s statistics were no longer probative or were “fatally flawed.” See Dukes I, 222 F.R.D. at 161-62; see also id. at 159(coneluding that Wal-Mart failed to persuade the court “that Dr. Drogin’s regional analysis should be rejected ... because it is lacking in probative value”); id. at 160(coneluding that “[Wal-Mart] has not discredited or nullified Dr. Drogin’s results” with respect to Wal-Mart’s objection that Drogin’s methodology failed to account for a variety of relevant factors). The majority affirms this error by simply labeling the district court’s analysis as “rigorous” and insisting (without analysis) that the district court adequately probed behind the pleadings.
Had the district court properly analyzed the evidence, it could not have concluded that Drogin’s statistics constituted significant proof of plaintiffs’ theory. Information about disparities at the regional and national level does not establish the existence of disparities at individual stores, let alone raise the inference that a company-wide policy of discrimination is implemented by discretionary decisions at the store and district level. As Wal-Mart’s statistical expert, Dr. Joan Haworth, explained, the statistical disparities at the regional level could be due to decisions made at only a small percentage of Wal Mart stores.12 Indeed, Haworth concluded that, when data is considered at the store level, over 90 percent of Wal-Mart’s stores showed no statistical difference in the hourly pay rates between men and women associates with similar work-related characteristics. Although Drogin argued that it was proper to conduct an analysis on a regional level because “the subjective decision-making in compensation and promotions takes place within parameters and guidelines that are highly uniform, and within a strong corporate culture,” Dukes I, 222 F.R.D. at 157, this argument makes little sense. Among other things, this argument is contrary to the thrust of plaintiffs’ legal theory, namely, that the decisions of individual managers regarding pay and promotions are subjective and not subject to uniform “parameters and guidelines.” It is also contrary to the district court’s own determination that “in-store pay and promotion decisions are largely subjective and made within a substantial range of discretion by store or district level managers.” Id. at 152. More important, because statistical disparities may ex*638ist at the regional level even if the majority (or all) of the store managers made nondiscriminatory decisions at the store level, Drogin’s data is not sufficiently probative of conditions at the store level to constitute significant proof of the existence of a class subjected to a policy of company-wide discrimination.13
The majority disposes of Wal-Mart’s objection that regional data is not indicative of a general discriminatory policy at individual stores by criticizing Wal-Mart’s statistics, which aggregated data at the sub-store rather than the store level, an approach the district court had previously allowed.
Dukes I, 222 F.R.D. at 157 n. 25. But the quality of the defendant’s statistics is not the issue here; rather, it is the plaintiffs’ burden to produce significant proof of a policy of discrimination across Wal-Mart that manifested itself in similar ways throughout the company. See Falcon, 457 U.S. at 160, 102 S.Ct. 2364. Plaintiffs’ statistics lack probative value even without Wal-Mart’s opposing data.
If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education, may testify thereto in the form of an opinion or otherwise, if (1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case.
3
Finally, the district court committed legal error by failing to test the reliability of the expert opinion of William Bielby, Ph. D., as required by Federal Rule of Evidence 70214 and Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 589, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993). In brief, Bielby presented his theory that subjective decision making, such as that which occurs at Wal-Mart stores, is “susceptible to unconscious discriminatory impulses.” 15 Wal-Mart moved to strike Bielby’s testimony on the ground that his opinion was not reliable. According to *639Wal-Mart, Bielby failed to apply the same standards to his work in preparing his testimony that he applied to his work as a scientist. Wal-Mart alleged, inter alia, that Bielby had misrepresented aspects of the literature upon which he relied, made unsustainable extrapolations from that literature, failed to consider evidence that tended to undermine his theory, and failed to test his data.
Instead of evaluating the reliability of Bielby’s report in light of Wal-Mart’s arguments, the district court denied WalMart’s motion on the ground that “courts should not even apply the full Daubert ‘gatekeeper’ standard” at the class certification stage. Dukes II, 222 F.R.D. at 191. Rather, the district court held that “[t]he appropriate question at this stage of the litigation is not whether Dr. Bielby can make a conclusive determination, but whether [his opinion] could add probative value to the inference of discrimination that plaintiffs allege.” Dukes I, 222 F.R.D. at 154. Concluding that the report was not “so flawed that it lacks sufficient probative value to be considered in assessing commonality,” the district court relied on Bielby’s report in making its determination that plaintiffs met the Rule 23(a) requirements. Dukes II, 222 F.R.D. at 192.
In so ruling, the district court misunderstood Daubert and the level of inquiry required at the class certification stage. The purpose of conducting a Daubert inquiry is to ensure that proffered expert testimony is relevant and reliable. Kumho Tire Co. v. Carmichael, 526 U.S. 137, 152, 119 S.Ct. 1167, 143 L.Ed.2d 238 (1999). “It is to make certain that an expert, whether basing testimony upon professional studies or personal experience, employs in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field.” Id. To this end, a court must make “a preliminary assessment of whether the reasoning or methodology underlying the testimony is scientifically valid and of whether that reasoning or methodology properly can be applied to the facts in issue.” Daubert, 509 U.S. at 592-93, 113 S.Ct. 2786. Courts are obliged to address allegations that an expert’s opinion is not supported by the data, and may reject “opinion evidence that is connected to existing data only by the ipse dixit of the expert.” Gen. Elec. Co. v. Joiner, 522 U.S. 136, 146, 118 S.Ct. 512, 139 L.Ed.2d 508 (1997).
These principles are equally applicable in the class certification context. The district court must “assess all of the relevant evidence admitted at the class certification stage and determine whether each Rule 23 requirement has been met, just as the judge would resolve a dispute about any other threshold prerequisite for continuing a lawsuit.” In re Initial Pub. Offerings Sec. Litig., 471 F.3d 24, 42 (2d Cir.2006). Like any other evidence, expert evidence introduced to “establish a component of a Rule 23 requirement” must be reliable; it is not enough that the expert testimony is “not fatally flawed.” Id.; see also Am. Honda Motor Co. v. Allen, 600 F.3d 813, 815-16, (7th Cir.2010) (holding that the court must conduct a Daubert analysis on key expert testimony even at the class certification stage); In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305, 323 (3d Cir.2008) (“Expert opinion with respect to class certification, like any matter relevant to a Rule 23 requirement, calls for rigorous analysis.”). A court cannot reasonably certify a class based on evidence that is not “based upon sufficient facts or data, ... the product of reliable principles and methods,” and the product of reliable application of the methods to the facts. Fed.R.Evid. 702. Although a district court has considerable discretion under Daubert, there is no basis for the district court’s conclusion that it can forego a reliability *640inquiry altogether. The district court abused its discretion in doing so.16
The majority’s discussion of this claim misses the mark entirely. First, instead of engaging the question whether the district court properly tested the reliability of Bielby’s testimony, the majority simply concludes that “Dr. Bielby presented scientifically reliable evidence.” Maj. Op. at 603. This not only assumes the answer to the very question at issue, but is wrong on its face: The district court explicitly did not consider whether the evidence was “scientifically reliable,” holding instead that the evidence was not “so flawed that it lacks sufficient probative value to be considered in assessing” whether class certification was appropriate. Dukes II, 222 F.R.D. at 192.17
The majority focuses its discussion on what it characterizes as Wal-Mart’s objection to the persuasiveness of Bielby’s testimony. According to the majority, WalMart “did not (and does not) challenge Dr. Bielby’s methodology.” Maj. Op. at 602. In fact, Wal-Mart never challenged the persuasiveness of Bielby’s testimony, but rather challenged Bielby’s methodology, a challenge that is proper under Daubert. See Daubert, 509 U.S. at 592-93, 113 S.Ct. 2786; see also Joiner, 522 U.S. at 144, 118 S.Ct. 512. By missing this point, the majority erroneously approves the district court’s reliance on an arguably unreliable expert opinion.
D
When plaintiffs’ evidence is subjected to the rigorous inquiry required by Falcon, it is inadequate to bridge the gap between the six plaintiffs’ claims of individual discrimination and a class-wide claim of company-wide discrimination. None of plaintiffs’ evidence is probative of company-wide discrimination. Every piece of evidence merely purports to support another. While plaintiffs’ anecdotes do not show company-wide discrimination, plaintiffs argue they support the statistical evidence. The statistics are not probative of a company-wide policy of discrimination, but plaintiffs allege they may be “attributable” to such a policy when viewed in connection with Wal-Mart’s uniform corporate policies. Maj. Op. at 600-01. The uniform corporate policies are not themselves discriminatory but, according to plaintiffs, provide a potential “conduit” for discrimination. Maj. Op. at 600. The expert opinions do not point to discrimination on a company-wide basis, but merely “support ] the existence of company-wide policies and practices that likely include a culture of gender stereotyping.” Maj. Op. at 600 (emphasis added). And Wal-Mart’s corporate policy of subjective decision *641making is not discriminatory in itself but, plaintiffs urge, may be evidence of company-wide discrimination in light of the statistical evidence and anecdotes. Maj. Op. at 611. Like the proverbial shell game, the plaintiffs’ circular presentation cannot conceal the fact that they have failed to offer any significant proof of a company-wide policy of discrimination, no matter which shell is lifted.
By taking the district court’s determination at face value, the majority erroneously accepts a chain of weak inferences as sufficient to carry plaintiffs’ burden of adducing significant proof that Wal-Mart “operated under a general policy of discrimination” that affected all members of the class. Falcon, 457 U.S. at 159 n. 15, 102 S.Ct. 2364. Any reasonable scrutiny of the evidence in this case compels the conclusion that although the six plaintiffs here may have individualized claims of discrimination, they cannot represent a class of 1.5 million past and present employees. The district court abused its discretion in holding that the plaintiffs met the commonality and typicality requirements of Rule 23(a).
Ill
Even assuming the district court was correct in concluding that the proposed class satisfied the Rule 23(a)-standard, the district court made two crucial errors when it certified the class under Rule 23(b)(2). First, the district court failed to consider whether it could protect the parties’ substantive rights in the class action context. Although the plaintiffs were bringing Title VII claims, the district court erroneously concluded that it had no obligation to allow Wal-Mart to raise the statutory defenses provided by Title VII. This was an error: A court must ensure that its certification of a class does not affect the substantive rights of either party. See Rules Enabling Act, 28 U.S.C. § 2072(b);18 Ortiz v. Fibreboard Corp., 527 U.S. 815, 845, 119 S.Ct. 2295, 144 L.Ed.2d 715 (1999) (“[N]o reading of the Rule can ignore the Act’s mandate that rules of procedure shall not abridge, enlarge or modify any substantive right.” (internal quotation marks omitted) (quoting Am-chem Prods., Inc. v. Windsor, 521 U.S. 591, 613, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997))). This mistake led to a second legal error: Because the district court turned a blind eye to Wal-Mart’s right to individual hearings, the district court failed to realize that the class did not fit the historical model of Rule 23(b)(2), and therefore could not be certified under that section of the rule.
A
The parties’ substantive rights in this ease are defined by Title VII. The majority acknowledges that the legal and factual frameworks of different causes of action can impact the outcome of a court’s Rule 23 determination. Maj. Op. at 580, 591-92. Yet the majority fails to address the specific legal and factual framework of Title VII or consider how it impacts the certification of plaintiffs’ proposed class. It is therefore necessary to provide some background regarding the structure of claims and defenses under Title VII before discussing the majority and district court’s error in certifying the proposed class under Rule 23(b)(2).
1
Under Title VII, the plaintiff has the ultimate burden of establishing that the *642employer is engaged in an unlawful employment practice described in 42 U.S.C. § 2000e-2. If the plaintiff prevails in a Title VII action, the court “may enjoin the respondent from engaging in such unlawful employment practice, and order such affirmative action as may be appropriate, which may include, but is not limited to, reinstatement or hiring of employees, with or without back pay ..., or any other equitable relief as the court deems appropriate.” 42 U.S.C. § 2000e-5(g)(1). In cases where the plaintiff alleges that the employer engaged in intentional discrimination, the plaintiff may also seek compensatory and punitive damages. § 1981a(a)(l). Punitive damages are available only if the plaintiff can show the employer acted “with malice or with reckless indifference to the federally protected rights of an aggrieved individual.” § 1981a(b)(1); e.g., Landgraf v. USI Film Prods., 511 U.S. 244, 254, 114 S.Ct. 1483 (1994).
Title VII affords defendant-employers certain affirmative defenses. If the employer can prove that an adverse employment action against an individual employee was “for any reason other than discrimination on account of race, color, religion, sex, or national origin or in violation of section 2000e-3(a) of this title,” a court shall not order the “hiring, reinstatement, or promotion of an individual as an employee, or the payment to him of any back pay.” § 2000e-5(g)(2)(A). Even if the employee proves that the adverse employment action was motivated in part by a discriminatory motive, see § 2000e-2(m), a court cannot award damages or back pay if the employer can prove that it “would have taken the same action in the absence of the impermissible motivating factor,” § 2000e-5(g)(2)(B)(ii). See Costa v. Desert Palace, Inc., 299 F.3d 838, 848 (9th Cir.2002) (explaining that in a mixed motive case, an employer “may assert an affirmative defense to bar certain types of relief by showing the absence of ‘but for’ causation”), aff'd, 539 U.S. 90, 123 S.Ct. 2148, 156 L.Ed.2d 84. If the employer is successful in proving an affirmative defense, Title VII limits the court to granting declaratory or injunctive relief, as well as certain attorneys’ fees and costs. 42 U.S.C. § 2000e-5(g)(2)(B)(ii).
These defenses are available to a defendant regardless of whether the plaintiffs allege discrimination against a single individual or against a class. See 28 U.S.C. § 2072(b); Teamsters, 431 U.S. at 360, 97 S.Ct. 1843(citing Franks v. Bowman Trans. Co., 424 U.S. 747, 96 S.Ct. 1251, 47 L.Ed.2d 444 (1976)). An employer cannot be deprived of its statutory right to raise individualized defenses to claims for monetary relief merely because plaintiffs characterize their claim as a pattern or practice of discrimination and bring the suit on behalf of a class. Instead, the Supreme Court has created a framework for litigating pattern-or-practice claims that provides employers the opportunity to put forth individual defenses. See Teamsters, 431 U.S. at 360-62, 97 S.Ct. 1843.19
*643The first phase of a Title VII pattern-or-practice lawsuit focuses on company-wide practices. The party bringing the suit must first attempt “to establish by a preponderance of the evidence that ... discrimination was the company’s standard operating procedure[,] the regular rather than the unusual practice.” Id. at 336, 97 S.Ct. 1843. In this phase, the plaintiff need not show that each member of the class “was a victim of the employer’s discriminatory policy.” Id. at 360, 97 S.Ct. 1843. If the plaintiff “establish[es] a prima facie case that such a policy existed[,]” the burden shifts to the employer to show there was no such pattern of discrimination at a company-wide level. Id. If the employer fails to rebut the inference of discrimination arising from the plaintiffs’ prima facie case, the district court may “conclude that a violation has occurred” and order prospective relief. Id. at 361, 97 S.Ct. 1843.
But if plaintiffs seek individual relief such as reinstatement or back pay, the district court must conduct additional proceedings in the second phase of the trial “to determine the scope of individual relief.” Id. In this second phase, “[t]he proof of the pattern or practice supports an inference that any particular employment decision, during the period in which the discriminatory policy was in force, was made in pursuit of that policy.” Id. at 362, 97 S.Ct. 1843. Therefore, individual class members may establish a prima facie case merely by showing that an individual “unsuccessfully applied for a job and therefore was a potential victim of the proved discrimination.” Id. (footnote omitted). The burden then shifts to the employer to raise its affirmative defenses and to “demonstrate that the individual applicant was denied an employment opportunity for lawful reasons.” Id. Teamsters acknowledged that the district court’s task of determining individual relief would “not be a simple one,” because “the court will have to make a substantial number of individual determinations in deciding which of the minority employees were actual victims of the company’s discriminatory practices.”20 Id. at 371-72, 97 S.Ct. 1843.
As should be clear, claims for monetary relief cannot be resolved until this second *644phase. See, e.g., Reeb v. Ohio Dep’t of Rehab. & Corr., 435 F.3d 639, 651 (6th Cir.2006); Lemon v. Int’l Union of Operating Eng’rs, Local No. 139, 216 F.3d 577, 581 (7th Cir.2000); Allison, 151 F.3d at 417. This applies equally to punitive damages. Because the Supreme Court has indicated that punitive damages must bear a “reasonable relationship to compensatory damages,” BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 580, 116 S.Ct. 1589, 134 L.Ed.2d 809 (1996) (internal quotation marks omitted), “punitive damages must be determined after proof of liability to individual plaintiffs at the second stage of a pattern or practice case, not upon the mere finding of general liability to the class at the first stage,” Allison, 151 F.3d at 418; see also 42 U.S.C. § 1981a(b)(1)(an employer may avoid punitive damages by showing lack of requisite mens rea as to each aggrieved individual); Kolstad v. Am. Dental Ass’n, 527 U.S. 526, 545-46, 119 S.Ct. 2118,144 L.Ed.2d 494 (1999) (holding that an employer may avoid punitive damages under § 1981a if it has made good-faith efforts to prevent discrimination in the workplace); Rodriguez-Torres v. Caribbean Forms Mfr., Inc., 399 F.3d 52, 64 (1st Cir.2005) (holding that an employer’s good faith efforts to implement an anti-discrimination policy in the workplace is an affirmative defense to an award of punitive damages under § 1981a).
In sum, a determination that an employer has engaged in a pattern or practice of discrimination in violation of Title VII entitles the class to prospective relief and creates a presumption of liability for individual relief. The employer then has a statutory right, recognized by the Supreme Court, to prove that its actions against individual employees were not discriminatory. The Rules Enabling Act prohibits a district court from depriving an employer of this right simply to facilitate the certification of a class action.21 See 28 U.S.C. § 2072(b).
2
In this case, notwithstanding the requirements of Title VII, the district court rejected Wal-Mart’s arguments that it was entitled to raise a defense with respect to each class member’s claim for back pay and punitive damages. Dukes I, 222 F.R.D. at 173-74. The district court did not provide any reason for this decision, stating only that “holding individual hearings for the number of women potentially entitled to backpay in this case is impractical on its face, and thus the traditional Teamsters mini-hearing approach is not feasible here.” Id. at 176.
It seems obvious that the district court’s determination that it could not certify the class in compliance with Teamsters compels the conclusion that it could not certify the class at all. Nevertheless, the district court determined it could bypass Supreme Court precedent. Relying on cases the court characterized as allowing back pay awards to be calculated on a class-wide basis, see Dukes I, 222 F.R.D. at 176-78, 180, 184, the district court held that once plaintiffs proved that Wal-Mart engaged *645in a pattern or practice of discrimination, liability as to individual class members could be determined by means of a formula for employees denied promotions, id. at 176-78, or by analyzing Wal-Mart’s personnel data to identify employees entitled to back pay, id. at 184-86. Further, the district court rejected Wal-Mart’s argument that punitive damages could not be awarded on a class-wide basis, holding that it could “limit recovery of any punitive damages to those class members who actually recover an award of lost pay,” as determined by a formula. Id. at 172.
In adopting the approach described above, the district court deprived WalMart of its statutory right to raise its defenses and violated the mandate of the Rules Enabling Act. If Wal-Mart can prove that it took an adverse employment action with respect to a particular plaintiff for non-discriminatory reasons, or that it “would have taken the same action in the absence of the impermissible motivating factor,” 42 U.S.C. § 2000e-5(g)(2)(A), (B), it cannot be held liable for back pay or punitive damages as to those individual class members. See Teamsters, 431 U.S. at 361, 97 S.Ct. 1843.
The cases relied on by the district court, see Dukes I, 222 F.R.D. at 176-78, 180, 184, do not justify its refusal to provide individual hearings, but rather provide that defendants are entitled to raise statutory defenses to liability. See Domingo, 727 F.2d at 1445; see also McKenzie v. Sawyer, 684 F.2d 62, 77-78 (D.C.Cir.1982), abrogated on other grounds by Berger v. Iron Workers Reinforced Rodmen, Local 201, 170 F.3d 1111 (D.C.Cir.1999); Hameed v. Int’l Ass’n of Bridge, Structural & Ornamental Iron Workers Local Union No. 396, 637 F.2d 506, 520 (8th Cir.1980) (“If a black applicant was rejected for a nondiscriminatory reason, that applicant would not be a member of the class of potential discriminatees.”). The district court could not properly rely on cases that preceded Teamsters, see, e.g., Stewart v. Gen. Motors Corp., 542 F.2d 445, 452-53 (7th Cir.1976), nor those from other circuits that are contrary to Teamsters, see, e.g., EEOC v. O & G Spring & Wire Forms Specialty Co., 38 F.3d 872, 879-80 & n. 9 (7th Cir.1994); Segar v. Smith, 738 F.2d 1249, 1291-92 (D.C.Cir.1984).
B
The district court’s crucial misunderstanding of Title YII and Teamsters led to a second mistake: it failed to undertake a proper analysis of whether the proposed class should be certified under Rule 23(b)(2) or Rule 23(b)(3). The majority makes the same error, with nary an acknowledgment that the Supreme Court has provided general guidelines for making this determination. See, e.g., Ortiz, 527 U.S. at 845-46, 119 S.Ct. 2295; Amchem, 521 U.S. at 625, 117 S.Ct. 2231. Again, to understand how the district court and majority went astray, it is first necessary to describe the basic analytical structure for categorizing classes under Rule 23(b).
1
Rule 23(b) establishes three different types of classes. In certifying a proposed class, courts must determine whether a proposed class fits into the historical models on which Rule 23(b)(1) or (2) were based, or is a more “adventuresome” class action, Amchem, 521 U.S. at 614, 117 S.Ct. 2231, that must be certified under Rule 23(b)(3). See Ortiz, 527 U.S. at 832-37, 119 S.Ct. 2295.
Courts considering whether to certify a class under Rule 23(b)(1) or (2) must take the “prudent course” of staying “close to the historical model” and “traditional paradigm” as understood by the Advisory Committee in drafting the rule. OHiz, 527 *646U.S. at 842, 864, 119 S.Ct. 2295. The Advisory Committee intended Rule 23(b)(1) classes to be “limited fund” actions, a type of action where multiple plaintiffs seek to divide a limited fund among claimants. Id. at 838-41, 119 S.Ct. 2295. Rule 23(b)(2) allows a court to certify a class action when “the party opposing the class has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.” Fed. R.Civ.P. 23(b)(2). A review of the historical sources relied upon by Ortiz reveals that the Advisory Committee based Rule 23(b)(2) on “various actions in the civil-rights field where a party is charged with discriminating unlawfully against a class, usually one whose members are incapable of Specific enumeration.” Fed.R.Civ.P. 23(b)(2) advisory committee’s note (1966). Specifically, the Committee cited, as the historical predicate of the Rule 23(b)(2) action, cases where plaintiffs endeavored to desegregate public accommodations through prospective declaratory and injunctive relief applicable to the class as a whole. Notably, these historical actions sought the correction of a specific discriminatory policy affecting all members of the class in the same way. See, e.g., Bailey v. Patterson, 323 F.2d 201, 206 (5th Cir. 1963).
None of the cases cited by the Advisory Committee included claims for monetary relief or individual relief of any kind. Fed. R.Civ.P. 23(b)(2) advisory committee’s note.22
The Advisory Committee Notes explain that, “[t]he subdivision does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages.” Id. In other words, Rule 23(b)(2) was designed for classes seeking class-wide injunctive relief to remedy a common injury to the class as a whole, not for classes seeking individual damages, back pay, or other individual relief.
While Rule 23(b)(1) and (2) are linked to well-understood historical models, Rule 23(b)(3) was designed for those cases in which “class-action treatment is not as clearly called for.” Amchem, 521 U.S. at 615, 117 S.Ct. 2231 (internal quotation marks omitted); see also Ortiz, 527 U.S. at 842, 119 S.Ct. 2295(explaining that the “Advisory Committee looked cautiously at the potential for creativity” under Rule 23(b)(1) and (2) and was “not forward looking as it was in anticipating innovations under Rule 23(b)(3)”); Fed.R.Civ.P. 23(b)(3) advisory committee’s note. Spe*647cifically, Rule 23(b)(3) provides for class actions that potentially allow plaintiffs to seek monetary relief on a class-wide basis. Fed.R.Civ.P. 23(b)(3) advisory committee’s note; Benjamin Kaplan, Continuing Work of the Civil Committee: 1966 Amendments of the Federal Rules of Civil Procedure (I), 81 Harv. L.Rev. 356, 393 (1967).
Because these more “adventuresome” class actions, Amchem, 521 U.S. at 614, 117 S.Ct. 2231, raise due process concerns, the Advisory Committee imposed two safeguards on courts certifying such a class. First, a district court must “find[ ] that the questions of law or fact common to class members predominate over any questions affecting only individual members.” Fed. R.Civ.P. 23(b)(3). This inquiry ensures that deviation from “the usual rule that litigation is conducted by and on behalf of the individual named parties only” is justified. Califano v. Yamasaki, 442 U.S. 682, 700-01, 99 S.Ct. 2545, 61 L.Ed.2d 176 (1979). Second, a district court must give prospective class members the opportunity to be excluded from the class, which is commonly known as the right to “opt out.” Fed.R.Civ.P. 23(c)(2)(B)(v). This option protects “the interests of the individuals in pursuing their own litigations[, which] may be so strong here as to warrant denial of a class action altogether.” Fed. R. Civ. Pro. 23(c)(2) advisory committee’s note. The opt-out option also ensures that the class is binding on those members of the class who choose not to opt out. Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 176, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1974).
This right to opt out of a class action, however, is exclusive to classes certified under Rule 23(b)(3). On its face, Rule 23 does not provide absent class members the right to request exclusion in classes certified under Rule 23(b)(2), and it is clear from the Rule’s structure that the Advisory Committee did not intend for such a right to exist under Rule 23(b)(2).23 Moreover, the Supreme Court has interpreted Rule 23(b)(2) as precluding opt outs. Ticor Title Ins. Co. v. Brown, 511 U.S. 117, 121, 114 S.Ct. 1359, 128 L.Ed.2d 33 (1994). In Ticor, the Supreme Court dismissed its grant of certiorari on the question whether binding absent class members to a class-wide settlement would violate their constitutional due process rights, where the district court certified the class under Rules 23(b)(1)(A) and (b)(2), and the absent members had not had the chance to opt out of the class. Id. at 120-21, 114 S.Ct. 1359. The Court first noted that Rule 23(b)(3) permits opt outs, and Rules 23(b)(1) and (b)(2) do not. Id. at 121, 114 S.Ct. 1359. From this, the Court reasoned it could avoid the constitutional question raised in the petition for certiorari if it held that “in actions seeking monetary damages, classes can be certified only under Rule 23(b)(3),” not Rules 23(b)(1) and (b)(2). Id. The Court concluded that this interpretation of Rule 23 “is at least a substantial possibility.” Id.24
*6482
In certifying this class under Rule 23(b)(2), the district court failed to take the “prudent course” required by Ortiz, 527 U.S. at 842, 119 S.Ct. 2295, and consider the history and structure of Rule 23(b). Had the district court undertaken such a review, it would have been compelled to conclude that the proposed class does not fit the historical model for Rule 23(b)(2) classes, and cannot be certified in that category. First, the proposed class raises an enormous number of individual questions. Although the plaintiffs’ action is in civil rights, the plaintiffs do not ask merely for class-wide injunctive relief (as in the cases cited by the Advisory Committee); they also seek individualized relief in the form of back pay and punitive damages. As explained above, this may result in up to 1.5 million individual questions about Wal-Mart’s liability for individual relief. A class that raises so many individual questions also raises the concerns the Advisory Committee expressly considered in drafting Rule 23(b)(3), and requires the court to ask whether “the questions of law or fact common to class members predominate over any questions affecting only individual members.” Fed.R.Civ.P. 23(b)(3). Given the facts in this case, it is far from certain that the proposed class could be certified under the more flexible model provided by Rule 23(b)(3), let alone meet the narrower historical model for Rule 23(b)(2).
Second, the class’s claims for monetary relief raise the very due process concerns considered by the Advisory Committee in drafting Rule 23(b)(3). The district court acknowledged that due process required that absent class members in this case be given the right to opt out of the class. See Dukes I, 222 F.R.D. at 172-73. Because Rule 23(b)(2) does not permit opt-outs, such recognition should have led the district court to determine that certification under Rule 23(b)(2) was inappropriate, and to instead consider whether the class met the criteria for certification under Rule 23(b)(3).
Given the Supreme Court’s direction to adhere to the historical models in considering which classes can be certified under Rule 23(b)(1) and (2), see Ortiz, 527 U.S. 815, 119 S.Ct. 2295, 144 L.Ed.2d 715; Amchem, 521 U.S. 591, 117 S.Ct. 2231, 138 L.Ed.2d 689, there was no reason for the district court here to sidestep the procedural requirements of Rule 23(b)(3) to certify this class under Rule 23(b)(2). See Eubanks v. Billington, 110 F.3d 87, 93 n. 9 (D.C.Cir.1997) (noting that when notice and opt-outs are required by the district court, “the arguments supporting certification ... under subdivision (b)(2) [as opposed to (b)(3) ] are surprisingly weak”). This is particularly true given that the district court’s primary justification for certification under Rule 23(b)(2) was that the suit was similar to the historical model contemplated by the Advisory Committee. See Dukes, 222 F.R.D. at 170. In certifying this class under Rule 23(b)(2), the district court abused its discretion.
C
In holding that the district court did not err in certifying the class under Rule 23(b)(2), the majority focuses not on the text, structure, and history of this rule, but rather on a single sentence in the Advisory Committee Notes which states that Rule 23(b)(2) “does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages.” Maj. Op. at 616 (quoting Fed. *649R.Civ.P. 23(b)(2) advisory committee’s notes). The majority infers from this single sentence that Rule 23(b)(2) must therefore extend to cases in which the appropriate final relief does not relate “exclusively or predominantly to money damages.” Maj. Op. at 616. The majority then turns to a dictionary definition of the word “predominant” and derives a new test: “a class must seek only monetary damages that are not ‘superiorjjn] strength, influence, or authority’ to injunctive and declaratory relief.’ ” Maj. Op. at 616 (citing Merriam-Webster’s Collegiate Dictionary 978 (11th ed.2004)).25 In furtherance of this test, the majority directs district courts to consider “the objective 'effect of the relief sought’ on the litigation,” by recourse to “[f|actors such as [1] whether the monetary relief sought determines the key procedures that will be used, [2] whether it introduces new and significant legal and factual issues, [3] whether it requires individualized hearings, and [4] whether its size and nature ... raise particular due process and manageability concerns.” Maj. Op. at 617.26
But in upholding the district court’s certification with regard to back pay, the majority fails to apply these factors from its own test. Had it done so, it would have concluded that the district court erred in certifying the class under Rule 23(b)(2). First, the plaintiffs’ claim for back pay triggers the need for a key procedure (factor 1), namely the requirement for individualized hearings (factor 3). Second, the plaintiffs’ claims for individual relief introduced significant new legal and factual issues into the case (factor 2), including Wal-Mart’s defenses to liability, as well as due process concerns that necessitate opt-outs (factor 4). Third, the need for individualized hearings raises serious manageability concerns (factor 4).
The majority avoids these issues, however, and dismisses Wal-Mart’s arguments as mere objections to the district court’s “trial plan.” Maj. Op. at 624. The majority “express[es] no opinion regarding WalMart’s objections to the district court’s tentative trial plan” and concludes that there are many steps the district court could take “that would allow this class action to proceed in a manner that is both manageable and in accordance with due process,” Maj. Op. at 625 (citing Hilao v. Estate of Marcos, 103 F.3d 767, 782-87 (9th Cir.1996))27
*650The majority’s failure to address these objections runs contrary to the Supreme Court’s mandate, Ortiz, 527 U.S. at 861, 119 S.Ct. 2295, and the majority’s own rule, Maj. Op. at 6217(stating that courts must consider “whether [the proposed class action] requires individualized hearings” when it determines whether a class may be certified under Rule 23(b)(2)).
Presumably because the application of its own test would lead to the conclusion that the district court erred, the majority does not apply its test (or remand back to the district court to apply it, as it did with the punitive damages class). Instead, the majority determines that the back-pay remedy does not predominate over the claims for injunctive and declaratory relief for two reasons: (1) the calculation of back pay in Title VII cases “generally involves [relatively uncomplicated factual determinations and few[] individualized issues,” and (2) back pay is a “ ‘make whole’ remedial scheme, a scheme to which the drafters of the Federal Rules of Civil Procedure clearly intended Rule 23(b)(2) to apply.” Maj. Op. at 619 (alterations in original) (citations omitted). As noted above, neither of these rationales is correct. In this case, back pay cannot be calculated until after Wal-Mart has had an opportunity to raise its defenses, which will involve the litigation of a multitude of individual issues. Moreover, while' the drafters of Rule 23 intended that classes involving demands for injunctive relief be certified under Rule 23(b)(2), the majority provides no evidence that the Advisory Committee thought Rule 23(b)(2) was appropriate for classes seeking back pay.28
As to claims for punitive damages, the majority remands the case to the district court to determine under its new test whether the case could be certified under Rule 23(b)(2). Maj. Op at 622. Before *651doing so, however, it determines in a single sentence that punitive damages do not require individualized determinations because the plaintiffs allege that Wal-Mart’s policy “affects all class members in a similar way.” Maj. Op. at 622. This unprecedented holding, made with virtually no analysis, is wrong both as a matter of law and fact. As noted above, it conflicts with the statutory language of Title VII, see 42 U.S.C. § 2000e-5(g)(2)(B), and with the Supreme Court’s reasoning regarding punitive damages, see BMW, 517 U.S. at 581, 116 S.Ct. 1589. Moreover, it is factually wrong: even assuming there was significant proof of a company-wide policy of discrimination, plaintiffs do not allege that Wal-Mart’s alleged policy affected all class members in the same way for purposes of determining monetary relief. Plaintiffs acknowledge that Wal-Mart’s allegedly discriminatory practices have affected class members differently, stating that “different class members may have been under-compensated in different amounts; some employees may have been denied promotion to assistant manager while others may have been denied promotion to store manager.” The district court cannot reasonably determine whether an individual class member was injured, let alone the nature and amount of injury, until the second phase of individual hearings has been accomplished. Other circuits addressing the issue have agreed with this analysis. See, e.g., Reeb, 435 F.3d at 651; Lemon, 216 F.3d at 581; Allison, 151 F.3d at 417. By untethering punitive damage claims in a Title VII case from evidence regarding how the plaintiffs were actually injured, the majority opens the door to results that would be unfair to both claimants and defendants in future Title VII class actions.
IV
The class action device is a procedural mechanism to aggregate individual claims for purposes of judicial efficiency. Falcon, 457 U.S. at 159, 102 S.Ct. 2364. By allowing claims to go forward that ordinarily would not be litigated, the class action has proven to be an invaluable tool in litigating civil rights and other cases involving systemic discrimination. But, because Rule 23 creates a procedural device that constitutes “an exception to the usual rule that litigation is conducted by and on behalf of the individual named parties only,” Califano, 442 U.S. at 700-01, 99 S.Ct. 2545, courts must use it carefully, ensuring that the proposed class action complies with controlling law and does not jeopardize the parties’ substantive rights. See Gulf Oil Co. v. Bernard, 452 U.S. 89, 100, 101 S.Ct. 2193, 68 L.Ed.2d 693 (1981) (holding that, in considering a proposal to certify a class, the district court’s discretion is “bounded by the relevant provisions of the Federal Rules”). The “[m]ere invocation of the language of Rule 23 in Title VII suits is no mystical legal talisman guaranteeing class treatment.” Doninger v. Pac. Nw. Bell, Inc., 564 F.2d 1304, 1312 (9th Cir.1977).
The district court here failed in its duty to apply Rule 23 carefully and correctly. In its enthusiasm for allowing the class action to proceed, the district court sped forward, dodging substantive and procedural hurdles, and making an end-run around Title VII, the Rules Enabling Act, and Supreme Court precedent. It conducted no rigorous analysis to determine “the existence of a class of persons who have suffered the same injury” as the class representatives. Falcon, 457 U.S. at 157, 102 S.Ct. 2364. It certified the class even after determining that compliance with the Supreme Court’s framework in Teamsters was infeasible. Finally, the district court failed to consider the text, structure, and historical framework of Rule 23(b) that should have guided its analysis. The re*652sultant class certification runs directly contrary to controlling precedent.
Despite these flaws, the majority affirms those legal errors with even less analysis and inquiry than the district court. Never before has such a low bar been set for certifying such a gargantuan class. The majority’s ruling provides scant limits to the types of classes that can be certified. Put simply, the door is now open to Title VII lawsuits targeting national and international companies, regardless of size and diversity, based on nothing more than general and conclusory allegations, a handful of anecdotes, and statistical disparities that bear little relation to the alleged discriminatory decisions. The district court abused its discretion in certifying this class. The majority errs in concluding otherwise. While class actions have a vital role to play in the battle against discrimination, the majority’s decision to allow this case to go forward epitomizes the Supreme Court’s warning that “the rulemakers’ prescriptions for class actions may be endangered by those who embrace Rule 23 too enthusiastically just as they are by those who approach the Rule with distaste.” Amchem, 521 U.S. at 629, 117 S.Ct. 2231 (internal citations, quotation marks, and alterations omitted). I respectfully dissent.

. Sam’s Club is a separate corporate division within Wal-Mart, but operates in roughly the same manner and with a similar organizational structure as Wal-Mart.

. Edith Arana was terminated in October 2001 for falsifying her time sheets.

. The complaint was filed in June 2001. Patricia Surgeson left Wal-Mart in March 2001 to take another job, Cleo Page resigned in November 2000 after she received a written warning for performance issues, and Deborah Gunter resigned in August 1999 after WalMart reduced her hours.

. For example, proposed class representative Page alleges that she was passed over for promotion by her store manager, Monique Taylor. Proposed class representative Gunter complained about being passed over for a promotion by her store manager, Kathy Bishop, who Gunter also alleges brushed off allegations Gunter made about sexual harassment. Proposed class representative Kwapnoski discussed her interest in promotion with her assistant manager, Nancy Horn. Taylor, Bishop, and Horn are all members of the proposed class. This case features the unusual distinction of placing victims and their alleged victimizers on the same side of the counsel table.

. The majority criticizes the dissent for pointing out the large size of the class, reasoning that the class size may decrease by up to two-thirds if past employees are excluded. See Maj. Op. at 578 n. 3. In determining whether the district court abused its discretion, however, we must consider the class actually certified by the district court, which included past employees. Dukes I, 222 F.R.D. at 188. Moreover, as explained below, the reasons *631this class cannot be certified apply with equal force regardless of whether the class represents 1.5 million individuals or the class of 500,000 envisioned by the majority.

. Rule 23(a) of the Federal Rules of Civil Procedure provides that "[o]ne or more members of a class may sue or be sued as representative parties on behalf of all members only if” the class meets the prerequisites of numerosity, commonality, typicality, and adequacy of representation.

. The term "commonality” refers to the requirement in Rule 23(a) that "there are questions of law or fact common to the class”; "typicality” refers to the requirement that "the claims or defenses of the representative parties are typical of the claims or defenses of the class.” Fed.R.Civ.P. 23(a). Falcon noted that "[t]he commonality and typicality requirements of Rule 23(a) tend to merge. Both serve as guideposts for determining whether under the particular circumstances maintenance of a class action is economical and whether the named plaintiff's claim and the class claims are so interrelated that the interests of the class members will be fairly and adequately protected in their absence.” 457 U.S. at 158 n. 13, 102 S.Ct. 2364.

. To support this point, the majority cites to a dissent from the denial of rehearing en banc, Lopez-Rodriguez v. Holder, 560 F.3d 1098 (9th Cir.2009), which provides no support. See Maj. Op. 595 n. 15. Lopez-Rodriguez merely stated that the Supreme Court's language should not be applied "to create a new rule— one [the Court] never envisioned.” Maj. Op. at 595 n. 15 (quoting Lopez-Rodriguez, 560 F.3d at 1099). This truism does not support the majority's position that we have the option to ignore the Supreme Court's guidance on an issue directly before the Court, as in Falcon.

. As pointed out by the majority, the plaintiffs also produced "facts supporting the existence of company-wide policies and practices.” Maj. Op. at 600. Because it is undisputed that Wal-Mart maintains uniform company-wide policies, and because the mere existence of company-wide policies says nothing about whether such policies are discriminatory, there is no need to discuss such "facts” separately from plaintiffs’ other purported evidence.

. The number of Wal-Mart stores and managers set forth in this paragraph are based on information provided by plaintiffs' expert, Dr. Marc Bendick, and are current as of 1999.

. Until today, this circuit's largest stretch to uphold certification in an employment discrimination class action based on a small number of incidents of discrimination occurred in Staton, where 237 individuals sought to represent a class of 15,000 African American employees. 327 F.3d at 948 n. 4, 953. Cautioning that this was an "ambitious” claim for commonality that was "especially worthy of scrutiny,” id. at 954, we nevertheless upheld the district court's class certification. In doing so, we noted that plaintiffs' lawyers interviewed more than 1,300 employees from facilities across the country, filed detailed documentation of discrimination experienced by 200 of those employees, and produced a company-wide internal survey to support their claims of class-wide racial discrimination. Id. Accordingly, at a minimum, the plaintiffs presented anecdotal evidence from one out of every 75 class members. No court, however, has ever held that one anecdote could suffice to represent the experiences of as vast a number as 12,-500 class members.

. In fact, Haworth pointed out that the statistical disparities between men and women at the regional level could also be the result of the aggregation of the data itself. This problem is known as “Simpson's Paradox,” which refers to “illusory disparities in improperly aggregated data that disappear when the data are disaggregated.” Eng’g Contractors Ass'n of S. Fla. Inc. v. Met. Dade County, 122 F.3d 895, 919 n. 4 (11th Cir. 1997); see also P.J. Bickel, E.A. Hammel, & J.W. O’Connell, Sex Bias in Graduate Admissions: Data from Berkeley, 187 Science 398 (1975) (using Simpson's Paradox to explain how researchers found a statistically significant bias in favor of male applicants when analyzing admissions data from all 101 of Berkeley's graduate departments, despite the fact that only 4 departments had a statistically significant bias in favor of males and 6 departments had a statistically significant bias in favor of females). As the article cited by the majority shows, it is especially likely that Drogin's statistics would display illusory disparities, because Drogin based his study on pre-existing information that was collected from a large sample size. See Marios G. Pavlides & Michael D. Perlman, How Likely Is a Simpson’s Paradox, 63 Am. Statistician 226, 230 (2009).

. The district court also relied on a study prepared by Dr. Marc Bendick, Ph.D., an economist and consultant, which made a company-wide comparison of Wal-Mart with twenty purportedly similar (but much smaller) retail companies. The study concluded that on a company-wide basis WalMart promoted a smaller percentage of women than its competitors. Again, the district court applied the wrong legal standard. Instead of conducting a rigorous evaluation of the evidence as required by Falcon, it accepted Bendick’s study at face value because it held it was "sufficiently probative to assist the Court in evaluating the class certification requirements at issue in this case.” Dukes v. Wal-Mart, Inc. (Dukes II), 222 F.R.D. 189, 195 (N.D.Cal.2004). In fact, Bendick’s study did not provide support for plaintiffs' claim that the 1.5 million women in the class were subject to discriminatory treatment in promotions, because it too failed to provide information derived from the level at which promotion and pay decisions were actually made.

. Federal Rule of Evidence 702 states that:

. The majority cites to Melissa Hart & Paul M. Secunda, A Matter of Context: Social Framework Evidence in Employment Discrimination Class Actions, 78 Fordham L.Rev. 37 (2009), for a description of Bielby’s "social framework analysis.” Maj. Op. at 601 n. 21. In employment discrimination litigation, social framework experts purport to summarize social science research regarding the workplace to give the finder of fact a "context” in which to decide key legal issues. Hart & Secunda, supra, at 44. The article by Hart and Secunda discusses the dispute among social psychologists over whether it is appropriate for experts like Bielby to use social framework analysis to draw specific factual conclusions about a company's operations without the use of case-specific research. See id. at 51-55. The controversy over the reliability of this methodology highlights the need for a proper Daubert inquiry here.

. The majority writes that it is “not convinced by the dissent’s argument that Daubert has exactly the same application at the class certification stage as it does to expert testimony relevant at trial.” Maj. Op. at 602 n. 22. But the majority never accounts for why it is "not convinced,” nor does it explain why the district court can rely on an expert's testimony that is not reliable, at the class certification stage or any other. Rule 702 and the Supreme Court make clear that evidence that is not scientifically valid does not " 'assist the trier of fact to understand the evidence or to determine a fact in issue.’ ” Daubert, 509 U.S. at 589, 113 S.Ct. 2786 (quoting Fed. R.Evid. 702).

. The majority errs in suggesting that the district court performed a proper Daubert inquiry, see Maj. Op. at 602-03 n.22, because it stated that Bielby’s opinion "is based on valid principles.” Dukes II, 222 F.R.D. at 192. Whether Bielby based his testimony on valid principles says nothing about whether he applied those principles via a valid methodology to produce relevant and reliable evidence, which is the critical issue under Daubert,

. 28 U.S.C. § 2072(b) provides:
(b) Such rules [of practice and procedure prescribed by the Supreme Court] shall not abridge, enlarge or modify any substantive right. All laws in conflict with such rules shall be of no further force or effect after such rules have taken effect.

. Teamsters involved a suit by the Attorney General under 42 U.S.C. § 2000e-6, which allows the government to bring an action when it has cause to believe that a person "is engaged in a pattern or practice of resistance to the full enjoyment of any of the rights” secured by Title VII. 431 U.S. at 328 n. 1, 97 S.Ct. 1843. Teamsters's two-step framework is equally applicable to class actions brought by individuals alleging discrimination. See id. at 358-59, 97 S.Ct. 1843 (noting that it was adopting the two-step framework set forth in Franks, 424 U.S. 747, 96 S.Ct. 1251, 47 L.Ed.2d 444, a class action brought by individuals alleging discrimination); see also Cooper, 467 U.S. at 876 n. 9, 104 S.Ct. 2794 (applying the Teamsters pattern-or-practice framework to class actions brought by individuals).

. While Teamsters referred to the second stage of individualized hearings as the remedial” stage of trial, 431 U.S. at 361, 97 S.Ct. 1843, this is a misnomer. As explained by Justice O'Connor in her concurrence in Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S.Ct. 1775, 104 L.Ed.2d 268 (1989), superceded in part by statute, Civil Rights Act of 1991, the second stage of individualized hearings is not remedial, but rather a second phase of liability, in which the employer is entitled to raise individual statutory defenses: ''It is misleading to speak of the additional proof required by an individual class member for relief as being a part of the damage phase, that evidence is actually an element of the liability portion of the case.” Id. at 266, 109 S.Ct. 1775 (O’Connor, J., concurring) (quoting Dillon v. Coles, 746 F.2d 998, 1004 (3d Cir. 1984)). We have explained the two-step procedure in a similar way. See EEOC v. Gen. Tel. Co. of Nw., Inc., 599 F.2d 322, 332 (9th Cir. 1979) (holding that the demonstration of a discriminatory pattern and practice in the first phase of the case establishes the individual class members’ prima facie case of discrimination, and shifts the burden to the employer "to prove that individuals were not in fact victims of previous discrimination”); see also Domingo v. New England Fish Co., 727 F.2d 1429, 1445 (9th Cir.1984) (holding that once class-wide discrimination has been shown, a claimant is presumptively eligible for back pay, subject to the employer "proving that the applicant was unqualified or showing some other valid reason why the claimant was not, or would not have been, acceptable”). Other circuits are in accord. See, e.g., Robinson v. Metro-North Commuter R.R. Co., 267 F.3d 147, 159 (2d Cir.2001); Allison v. Citgo Petroleum Corp., 151 F.3d 402, 417-18 (5th Cir. 1998); Dillon, 746 F.2d at 1004; Craik v. Minn. State Univ. Bd., 731 F.2d 465, 469-70 (8th Cir.1984); Mitchell v. Mid-Continent Spring Co. of Ky., 583 F.2d 275, 284 (6th Cir. 1978).

. The majority accuses the dissent of "ignor[ing] that the pattern and practice has to be proven on a group basis.” Maj. Op. at 625 n. 53 (emphasis in original). On the contrary, there is no doubt that a plaintiff must establish a pattern and practice of discrimination on a company-wide basis in the first phase of their case, as explained above. It is the majority that turns a blind eye to the second phase of Title VII litigation, where defendants have the right to raise affirmative defenses as to each class member. The majority never satisfactorily answers the question of how the district court would conduct up to 1.5 million individualized hearings during the second phase that Teamsters mandates.

. The Advisory Committee Notes cites the following cases, none of which involved monetary relief: Potts v. Flax, 313 F.2d 284 (5th Cir. 1963) (class action by two African-American parents against a “system-wide policy of racial segregation” in city schools); Bailey, 323 F.2d 201 (class action against laws segregating common carriers); Northcross v. Bd. of Ed., 302 F.2d 818 (6th Cir.1962) (class action by 18 African-American students and their parents seeking an order that the city end its biracial school system); Brunson v. Bd. of Trs. of Sch. Dist. No. 1, 311 F.2d 107 (4th Cir. 1962) (class action for school desegregation brought by 42 African-American students); Green v. Sch. Bd., 304 F.2d 118 (4th Cir.1962) (non-class action by 28 African American students seeking transfer to white schools and an injunction against school segregation); Mannings v. Bd. of Pub. Inst., 277 F.2d 370 (5th Cir. 1960) (class of African-American students seeking an injunction against school segregation); Orleans Parish Sch. Bd. v. Bush, 242 F.2d 156 (5th Cir. 1957) (class action on behalf of African-American school children to desegregate schools); Frasier v. Bd. of Trs. of Univ. of N.C., 134 F.Supp. 589 (M.D.N.C. 1955) (3-judge court) (class action by three African-Americans challenging a university’s discriminatory admissions policies), aff’d, 350 U.S. 979, 76 S.Ct. 467, 100 L.Ed. 848 (1956).

. For example, while Rule 23 provides that a court must give members of Rule 23(b)(3) classes notice and the right to opt out of the class, and may give notice to members of Rule 23(b)(2) classes, the Rule is silent on whether a court may give members of Rule 23(b)(2) classes the right to opt out. See Fed. R. Civ. Proc. 23(c)(2) and (d). The inference is that a court may not allow members of a Rule 23(b)(2) class to opt out of the class.

. To avoid the import of Ticor, the majority once again claims it is not bound by an order in which six Supreme Court justices have joined, characterizing Ticor as "not even dictum, let alone a holding.” Maj. Op. at 621 n.44. Yet, the majority cites no authority for this position, perhaps because the Ninth Circuit has relied upon such orders in prior opinions. See, e.g., Carroll v. Nakatani, 342 F.3d 934, 946-47 (9th Cir.2003) (relying on an order dismissing a writ as improvidently granted). Indeed, many of the cases relied *648upon by the majority cite to Ticor. E.g., Reeb, 435 F.3d at 646; Coleman v. Gen. Motors Acceptance Corp., 296 F.3d 443, 447 (6th Cir. 2002); Allison, 151 F.3d at 411 n. 3.

. The majority admits that it breaks with the Second Circuit in rejecting the subjective intent test, as well as with the Fifth, Sixth, Seventh, and Eleventh Circuits in rejecting the “incidental damages standard” test. Maj. Op. at 616. In creating this three-way circuit split, the majority not only ignores our own precedent, see Zimmerman v. State Dep't of Justice, 170 F.3d 1169, 1184 (9th Cir. 1999) (we create a circuit split “only after the most painstaking inquiry”), but aggravates the already-existing inconsistency between the circuits.

. As formulated by the majority, this test is essentially unusable. When is back pay “superior in strength” to an injunction? When do punitive damages have more "influence” than declaratory relief? It is unlikely that this test, particularly as applied by the majority, provides the district court with the guidance it needs on remand.

. Quite apart from the question whether Wal-Mart is objecting to the certification of the class (as it claims) or to the trial plan (as the majority states), the procedure set forth in Hilao cannot be used in a Title VII case and the majority errs in suggesting it can. We held in Hilao that a court could determine compensatory damages for over 10,000 claimants in a human rights action by means of a formula without violating the due process rights of the defendants. See Hilao, 103 F.3d at 782-87; but see id. at 788 (Rymer, J. dissenting) ("If due process in the form of a real prove-up of causation and damages cannot be accomplished because the class is too big or to do so would take too long, then (as the Estate contends) the class is unmanageable *650and should not have been certified in the first place.”); Cimino v. Raymark Indus., Inc., 151 F.3d 297, 319 (5th Cir.1998) (refusing to apply Hilao and noting that "we find ourselves in agreement with the thrust of the dissenting opinion there”). But Hilao has no bearing on this effort to certify a Title VII class action, because Title VII itself, and the Supreme Court’s interpretation of Title VII pattern-or-practice actions, see Teamsters, 431 U.S. at 360, 97 S.Ct. 1843, give defendants their right to a defense to each individual’s claim. See 42 U.S.C. § 2000e-5(g)(2).

. The majority claims it need not consider the problem posed by the class's pursuit of individual monetary relief because it is merely "joining] the consensus view that a request for back pay in a Title VII case is fully consistent with the certification of a Rule 23(b)(2) class action,” citing as support Thorn v. Jefferson-Pilot Life Insurance Co., 445 F.3d 311, 331-32 (4th Cir.2006) and Coleman, 296 F.3d 443. Maj. Op. at 619-20 & n. 41. Again, the majority misses the point. The issue is not that plaintiffs seek back pay; the issue is WalMart’s statutory right to raise individual defenses in response to the request for back pay, and whether such individualized treatment makes class-wide relief improper. Thom and Coleman reinforce this point. In Coleman, the Sixth Circuit held that the district court abused its discretion in certifying a class that included a claim for compensatory damages, in large part because such relief would require individual determinations as to each class member, thus obviating the efficiencies of pursuing the action on a class-wide basis. 296 F.3d at 449. Likewise, in Thom, the Fourth Circuit upheld the district court’s denial of class certification, in part because the availability of a statute of limitations defense presented individual issues that could not be determined on a class-wide basis. 445 F.3d at 32.7. Thom distinguished prior cases that certified classes requiring the calculation of back pay on the ground that such calculations "generally involve[d] ... fewer individualized issues.” Id. at 331 (alteration and internal quotation marks omitted). When considered as a whole (rather than taking a few phrases out of context), Thom and Coleman support the conclusion that class-wide relief is inappropriate where claims may need be litigated on an individual basis.