{"id":2855,"date":"2026-04-01T12:10:05","date_gmt":"2026-04-01T16:10:05","guid":{"rendered":"https:\/\/blogs.duanemorris.com\/classactiondefense\/?p=2855"},"modified":"2026-04-01T16:05:47","modified_gmt":"2026-04-01T20:05:47","slug":"new-york-federal-court-recommends-denial-of-class-certification-in-gender-pay-discrimination-suit-against-bloomberg","status":"publish","type":"post","link":"https:\/\/blogs.duanemorris.com\/classactiondefense\/2026\/04\/01\/new-york-federal-court-recommends-denial-of-class-certification-in-gender-pay-discrimination-suit-against-bloomberg\/","title":{"rendered":"New York Federal Court Recommends Denial Of Class Certification In Gender Pay Discrimination Suit Against Bloomberg"},"content":{"rendered":"
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By Gerald L. Maatman, Jr., Denis Yavorskiy, and Elizabeth Underwood<\/strong><\/p>\n\n\n\n

Duane Morris Takeaways<\/em>:<\/strong> On March 24, 2026, in Ndugga v. Bloomberg L.P., No. 20 Civ. 7464, 2026 WL 828730 (S.D.N.Y. Mar. 24, 2026), Magistrate Judge Gabriel W. Gorenstein in the U.S. District Court for the Southern District of New York issued a Report and Recommendation recommending<\/a> that class certification be denied in a gender-based pay discrimination case brought under Title VII of the Civil Rights Act of 1964, 42 U.S.C. \u00a7 2000e et seq. (\u201cTitle VII\u201d) and the New York State Human Rights Law, N.Y. Exec. Law \u00a7\u00a7 290-301 (\u201cNYSHRL\u201d).\u00a0 The Magistrate Judge determined that Plaintiff\u2019s statistical evidence was not significant and flawed and that Plaintiff failed to show that any pay disparity was traceable to a particular senior executive at Bloomberg L.P. (\u201cBloomberg\u201d).<\/em><\/p>\n\n\n\n

For employers defending against pattern-or-practice pay discrimination class actions, this decision provides a roadmap for defeating commonality and is a reminder that statistical evidence must be both methodologically sound and causally connected to an identified employment practice.<\/em><\/p>\n\n\n\n

Case Background<\/strong><\/p>\n\n\n\n

Naula Ndugga, a Black female news producer formerly employed at Bloomberg News, sued Bloomberg alleging gender-based pay discrimination.\u00a0 Ndugga began working as a paid intern at Bloomberg News in September 2017.\u00a0 Ndugga alleged that she was paid a starting salary of $65,000 while male producers hired out of the same internship program received $75,000 and that she was repeatedly overlooked for raises, promotions, and favorable assignments.\u00a0 Her operative complaint, filed in July 2024, sought certification a \u201cU.S. Class\u201d and a \u201cNew York Class,\u201d each of which included female reporters, producers, and editors who \u201c(1) were not Team Leaders or in other supervisory positions, and (2) were subjected to [Bloomberg\u2019s] compensation systems.\u201d\u00a0 Id<\/em>. at *2-3. According to Bloomberg, members of the putative classes worked in nearly 30 cities, in more than 30 different business units, held more than 30 different job profiles, and were assigned to more than 40 different peer groups. Id. <\/em>at *5. <\/p>\n\n\n\n

Central to Ndugga\u2019s theory was that compensation at Bloomberg News was controlled by a \u201csingle decisionmaker:\u201d Reto Gregori, Bloomberg News\u2019 deputy editor and a member of its Editorial and Research Management Committee.  Id<\/em>. at *4.  Ndugga maintained that Gregori \u201cmicromanaged, at both systemic and individual levels, every stage of [Bloomberg News\u2019] multipart evaluation and compensation systems,\u201d resulting in lower pay for women.  Id.<\/em> at *5.  Bloomberg countered that performance ratings and compensation decisions were made by hundreds of different managers across the organization.  Id<\/em>. <\/p>\n\n\n\n

Ndugga retained labor economist Dr. David Neumark, who performed a regression analysis comparing compensation between female and male employees while controlling for variables such as race, experience, education, job profile, performance ratings, business unit, and an accounting category referred to as \u201cCost Center.\u201d  Id<\/em>. at *19.  For the proposed U.S. Class, Neumark found that female employees\u2019 total compensation was 3.1% below that of similarly situated male employees, which was a difference of 1.64 standard deviations.  Id<\/em>. at *20.  For the proposed New York Class, Neumark found a 4.4% disparity, amounting to a difference of 2.29 standard deviations.  Id<\/em>. <\/p>\n\n\n\n

The Court\u2019s Analysis<\/strong><\/p>\n\n\n\n

Magistrate Judge Gorenstein\u2019s recommended denying class certification on the grounds that Ndugga failed to put forward sufficient evidence of discrimination to satisfy the commonality requirement of Rule 23(a)(2).<\/p>\n\n\n\n

First, the Magistrate Judge determined that Neumark\u2019s 1.64 standard deviation result as to the proposed U.S. Class was, by Neumark\u2019s own admission, not statistically significant.  Citing Ottaviani v. State Univ. of New York at New Paltz<\/em>, 875 F.2d 365, 371 (2d Cir. 1989), the court explained that \u201c[a] finding of two standard deviations corresponds approximately to a one in twenty, or five percent, chance that a disparity is merely a random deviation from the norm.\u201d  Id.<\/em> at *15.  While some courts have relaxed this threshold for small samples sizes, the Magistrate Judge found no basis for disregarding this rule because Neumark\u2019s analysis was based on a large dataset of 750 compensation records.  Id<\/em>. at *31. <\/p>\n\n\n\n

Second, for both proposed classes, the Magistrate Judge found that Neumark\u2019s inclusion of \u201cCost Center\u201d as a control variable in his regression analysis was improper.  Cost Center is an organizational accounting category to which costs are charged, and Neumark even acknowledged that it \u201cdoes not play a role in compensation guidelines.\u201d  Id.<\/em> at *35.  Bloomberg\u2019s expert, Dr. Denise Neumann Martin,  demonstrated that when Cost Center was excluded from the analysis, any observed pay differences between men and women were no longer statistically significant at either the 5% or 10% levels.  Id<\/em>. at *38.  Accordingly, the Magistrate Judge found that the inclusion of this variable \u201cobfuscate[d] the principal explanatory variable\u201d and created a mere \u201cappearance of difference.\u201d  Id<\/em>.<\/p>\n\n\n\n

Finally, the Magistrate Judge agreed with Bloomberg that Ndugga did not provide adequate evidence to show that any disparity in pay was traceable to Gregori.  Id<\/em>.  Specifically, the court noted that even if Gregori may have been involved in all aspects of compensation, this does not in itself establish that he was responsible for any pay disparity.  Id<\/em>. at *39. <\/p>\n\n\n\n

Implications For Employers<\/strong><\/p>\n\n\n\n

This Report and Recommendation in the Ndugga<\/em> case is a win for employers defending against pattern-or-practice gender pay discrimination class actions and provides guidance on how to defeat a showing of commonality. Employers should scrutinize a plaintiff expert\u2019s findings and assumptions, including whether they fall below the two-standard-deviation threshold, the size of the data set considered, and whether certain control variables are irrelevant like the Cost Center variable was here. <\/p>\n\n\n\n

The court\u2019s analysis also illustrates that where lower-level managers exercise substantial discretion over performance ratings and compensation, the involvement of a senior executive in a final review capacity does not automatically transform the process into a class-wide common policy.  Even if a plaintiff can show a common mode of exercising discretion through a decisionmaker\u2019s influence, she still must establish a causal relationship between this practice and the pay discrimination alleged. <\/p>\n","protected":false},"excerpt":{"rendered":"

By Gerald L. Maatman, Jr., Denis Yavorskiy, and Elizabeth Underwood Duane Morris Takeaways: On March 24, 2026, in Ndugga v. Bloomberg L.P., No. 20 Civ. 7464, 2026 WL 828730 (S.D.N.Y. Mar. 24, 2026), Magistrate Judge Gabriel W. Gorenstein in the U.S. District Court for the Southern District of New York issued a Report and Recommendation … <\/p>\n

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