Wal-Mart has decided to appeal the court’s decision in the near future

Published By: Jawwad Iqbal

It appears that Wal-Mart Stores, Inc. (NYSE:WMT) maybe tied in a high profile litigation battle soon. According to an earlier report published on Reuters, the company is being slapped with a lawsuit leveled by shareholders who feel defrauded by Wal-Mart for hiding its unlawful practices.

The unlawful practices in question involve Wal-Mart allegedly using bribery to grow its business in Mexico at a much faster rate. On Tuesday, U.S District Judge Susan Hickey from Fayetteville, Arkansas ruled against Wal-Mart’s argument that a Michigan-based pension fund had no liable cause since it did not incur any financial losses from the company’s shares.

As per the ruling, investors in Wal-Mart’s stock now have the right to launch a lawsuit against the company and its previous Chief Executive Officer, Mike Duke, under a class actions status. A class action lawsuit would have much more significant financial ramifications on Wal-Mart than an ordinary one.

The Judge elaborated on her decision noting that the class action status would further “enhance judicial economy and efficiency.” This is because stockholders, in general, may have small claims on an individual basis which altogether can be grouped with a consistent outcome that would result in fewer burdens on the judicial system.

Meanwhile, Wal-Mart’s representative, in a statement to Reuters, noted that a class action nature is not a viable option in this case. The company contends that it will appeal the court’s decision in future.