X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
On May 21, the U.S. Supreme Court announced a new standard for pleading federal complaints: Allegations must meet a “plausibility, not possibility” standard. Bell Atlantic Corp. v. Twombly, 127 S. Ct. 1955 (2007). As a result, federal courts across the country have been revisiting pleading standards on motions to dismiss in hundreds of cases. While most courts agree that the Twombly plausibility standard is not restricted to antitrust cases, there is some disagreement over what level of pleading that standard requires. Emerging doctrine suggests that what the plausibility standard requires varies, depending on the type of case. In Twombly, on a motion to dismiss an antitrust suit, the Supreme Court held that allegations that the defendants � regional providers of telephone and Internet services � engaged in “certain parallel conduct unfavorable to competition, absent some factual context suggesting agreement,” should be dismissed. The court “retired” the “no set of facts” portion of its 50-year-old maxim, from Conley v. Gibson, 355 U.S. 41 (1957), that “a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” The Twombly court reasoned, “Asking for plausible grounds to infer an agreement does not impose a probability requirement at the pleading stage; it simply calls for enough fact to raise a reasonable expectation that discovery will reveal evidence of illegal agreement.” 127 S. Ct. at 1965. The court denied that it was applying a “heightened” pleading standard, but, rather, “only enough facts to state a claim to relief that is plausible on its face. Because the plaintiffs here have not nudged their claims across the line from conceivable to plausible, their complaint must be dismissed.” Id. at 1974. In contrast, the dissent characterized the holding as a “dramatic departure from settled procedural law.” Id. at 1975. Two weeks later, the Supreme Court still cited Conley (as quoted by Twombly) and the liberal pleading standards of Rule 8(a)(2) in reversing the dismissal of a pro se civil rights complaint by an individual prisoner. Erickson v. Pardus, 127 S. Ct. 2191 (2007). The lower courts concluded that the plaintiff failed to allege that he suffered harm as the result of the prison’s discontinuance of Hepatitis C treatment, as opposed to the harm suffered on account of the condition itself. The Supreme Court held that it was error to conclude, for pleading purposes, that the plaintiff’s allegations were too conclusory when he alleged that the discontinuance of treatment was endangering his life. In June, the 2d U.S. Circuit Court of Appeals, the first circuit court to analyze Twombly, observed: “Considerable uncertainty concerning the standard for assessing the adequacy of pleadings has been created” by the Supreme Court’s decisions. Iqbal v. Hasty, 490 F.3d 143, 155 (2d Cir. 2007). In response to the opinions in Twombly and Erickson, parties in countless federal cases filed new motions to dismiss or filed supplemental briefs on pending motions to dismiss. Numerous federal courts ordered or permitted the amendment of complaints to meet the newly announced standard. See, e.g., Jenkins v. County of Hennepin, Minn., No. 06-3625, 2007 WL 1965552 (D. Minn. July 3, 2007). By early this fall, a search on Lexis or Westlaw showed that Twombly has been cited in more than 1,300 decisions since the Supreme Court issued its May decision. Of the courts that specifically addressed the “plausibility standard” aspect of Twombly, the vast majority have concluded that it applies to every type of complaint in federal court. What that plausibility standard requires, however, varies greatly depending on the type of case. Substance drives procedure The consensus of federal courts is that, following Twombly and Erickson, the quantum of facts required in a pleading depends on the cause of action. Substance now drives procedure. In Iqbal, the 2d Circuit applied the plausibility standard in the context of motions to dismiss � 1983 claims based on qualified immunity. Iqbal is one of several cases alleging constitutional and other claims against government officials who arrested and detained thousands of Arab and/or Muslim men following the attacks of Sept. 11, 2001. In Iqbal, the court described four signals from the Twombly opinion that point toward a “new and heightened pleading standard” and five different signals that “point away from a heightened pleading standard and suggest” that Twombly “might be limited to, or at least applied most rigorously in, the context of either all [15 U.S.C. 1] allegations or perhaps only those section I allegations relying on competitors’ parallel conduct.” 490 F.3d at 155-56. The Iqbal court noted, “Indeed, the [ Twombly] court used the word ‘plausibility’ or an adjectival or adverbial form of the word fifteen times (not counting quotations).” Id. at 156. The 2d Circuit concluded that the Supreme Court “is not requiring a universal standard of heightened fact pleading, but is instead requiring a flexible ‘plausibility standard,’ which obliges a pleader to amplify a claim with some factual allegations in those contexts where such amplification is needed to render the claim plausible.” Id. at 157-58. The Iqbal analysis has been cited with approval by several other circuit courts as well as by district courts in other circuits. See e.g., Weisbarth v. Geauga Park. Dist, No. 06-4189, 2007 WL 2403659, at *3 (6th Cir Aug. 24, 2007); Intel Corp. Microprocessor Antitrust Litigation, 496 F. Supp. 2d 404, 408 (D. Del. 2007). Intel applied “what the Second Circuit [in Iqbal] has coined the ‘flexible plausibility standard’ of Twombly” to each of the class plaintiffs’ seven federal and state antitrust causes of action in deciding whether the allegations of each were sufficient to withstand dismissal. Judge Joseph J. Farnan Jr. explained, “ The Court understands Twombly to primarily be a decision aimed at bringing the standard of dismissal back to its ‘roots’ by undoing the literal reading of Conley v. Gibson.” Id. at 408 n.2. The plausibility standard certainly applies outside of Twombly‘s antitrust context. For example, in Cannon v. GunnAllen Financial Inc., No. 3:06-0804, 2007 WL 2351313 (M.D. Tenn. Aug. 14, 2007), the court granted a motion to dismiss claims under the Tennessee Securities Act because the plaintiffs failed to put forth allegations that “raise a right to relief above the speculative level” with respect to each of the elements of their “control person” claims, but it denied a motion to dismiss claims under the doctrine of apparent authority. Further, in Anticancer Inc. v. Xenogen Corp., No. 05-CV-0448-B, 2007 WL 2345025 (S.D. Calif. Aug. 13, 2007), the court held that the Twombly plausibility standard “applies to pleadings in patent infringement actions such as the present action . . . [and that] pleadings must allege enough facts so as to demonstrate a plausible entitlement to relief.” See also ATSI Commc’ns v. Shaar Fund Ltd., 493 F.3d 87 (2d Cir. 2007). Two courts found that the Twombly standard also applied in trademark cases. In Collins v. Marva Collins Preparatory School, No. 1:05cv614, 2007 WL 1989828 (S.D. Ohio July 9, 2007), the court applied the Twombly plausibility standard in a federal trademark infringement case and dismissed claims against certain defendants regarding the naming of a school with an infringing name because the plaintiffs failed to allege that the defendants had any control over the naming. See also Fitzpatrick v. Sony-BMG Music, No. 07 Civ. 2933, 2007 WL 2398801, at *3 (S.D.N.Y. Aug. 15, 2007) (while trademark infringement complaint need not provide “detailed factual allegations,” it must “amplify a claim with some factual allegations . . . to render the claim plausible”). A tiny number of courts have explicitly concluded, to the contrary, that the Twombly plausibility standard is restricted to the context of an antitrust case. See, e.g., Kersenbrock v. Stoneman Cattle Co., No. 07-1044, 2007 WL 2219288 (D. Kan. July 30, 2007); U.S. v. Harchar, No. 1:06 CV 2927, 2007 U.S. Dist. Lexis 47028 (N.D. Ohio June 28, 2007). What is ‘plausible on its face’? The Twombly court pointed to the “simple fact pattern” in the model form for pleading negligence, Form 9, as providing, without more, the notice required by Fed. R. Civ. P. 8. Twombly, 127 S. Ct. at 1970 n.10. The court contrasted the simple negligence action with the antitrust action before it. The court held that an allegation of parallel conduct, “without more . . . may be indicative of a conspiracy, but [it is] just as much in line with a wide swath of rational and competitive business strategy.” Id. at 1964. Thus, the central question to be asked on a motion to dismiss, post- Twombly, is this: Is this the type of cause of action that, when pleaded in a complaint with factual predicates, sets forth a plausible claim for relief? If “yes,” then the allegations will withstand dismissal with or without reference to Twombly‘s plausibility standard. A number of decisions demonstrate that the plausibility standard is not implicated in simple causes of action. In negligence cases, the courts emphasize that part of Twombly that approved of the skeletal Form 9 Complaint for Negligence, and they cite to Erickson. For example, in Overton v. Foutty & Foutty LLP, No. 1:07-cv-0274, 2007 WL 2413026 (S.D. Ind. Aug. 21, 2007), the court denied a motion to dismiss an individual’s claims under the Fair Debt Collection Practices Act and negligence claims. The court noted, “Plaintiffs still need not plead a trail of specific facts to support each burden assumed by the assertion of a particular theory of liability . . . .And, as pointed out by the first reported court of appeals opinion to take a close look at Twombly, the Supreme Court’s explicit approval of Form 9 of the Federal Civil Rules, Complaint for Negligence, shows that it expects no heightened fact pleading requirement with regard to a bare allegation of negligence . . . .While Form 9 provides some detail with regard to where, when and how a plaintiff was injured in an automobile accident, the allegation upon which liability is premised is simply that the ‘defendant negligently drove a motor vehicle against plaintiff.’ The Supreme Court was not suggesting in Twombly that the plaintiff must allege more specifically that the negligent driver was speeding, ran a stop sign, or failed to yield.” Id. at *1. Similarly, in Watts v. Florida Intern. Univ., No. 05-13852, 2007 WL 2331029 (11th Cir. Aug. 17, 2007), the court reversed a dismissal of a free exercise claim, citing Twombly and concluding that the plaintiff “has alleged enough facts to suggest, raise a reasonable expectation of, and render plausible the fact that he sincerely held the religious belief that got him fired.” Further, in Charles v. Lawyers Title Ins. Co., No. 06-2361, 2007 WL 1959253 (D.N.J. July 3, 2007), at *8, *9, the court denied a motion to dismiss a claim under a consumer fraud statute although the complaint did not explicitly “set forth the misrepresentation in exact words,” concluding that even under the heightened standard of Fed. R. Civ. P. 9(b), the allegations “clearly demonstrate the ‘who, what, when, where, and how’ of the alleged fraud” and “provide sufficient information for the Defendant[s] to ‘prepare a defense as to the particular allegations of fraud.’ “ Two 6th Circuit cases are instructive. In Weisbarth v. Geauga Park. Dist., No. 06-4189, 2007 WL 2403659, at *3 (6th Cir. Aug. 24, 2007), the court affirmed the dismissal of a First Amendment retaliation claim, noting “our disposition does not depend upon the nuances of Twombly‘s effect on the dismissal standard.” Another 6th Circuit opinion declined to apply the plausibility standard by simply denying that the question was presented. In Lindsay v. Yates, No. 06-4430, 2007 WL 2316626, at *6 n.6 (6th Cir. Aug. 15, 2007), the court reversed dismissal of a housing discrimination claim without any consideration of the “plausibility” of the plaintiffs’ claims, noting, “Moreover, although this case does not present the question of if, or exactly how, Twombly has changed the pleading requirements of Federal Rule of Civil Procedure 8(a), we note that in Erickson v. Pardus . . . decided after Twombly, the Supreme Court reaffirmed that Rule 8(a) “requires only a short and plain statement of the claim showing that the pleader is entitled to relief.” The opinion by Judge R. Guy Cole Jr., who was a member of the panel that issued the opinion in Weisbarth just nine days later, concluded, without ever referencing plausibility, that the plaintiffs “pleaded claims for which relief may be granted.” Id. at *4. Invoking only “fair notice” concerns and not any “weeding out” concerns, the court concluded, “Because these allegations are sufficient to apprise the Defendants of the Lindsays’ claims and the grounds upon which they rest, the Lindsays have satisfied their pleading burden.” Id. Weisbarth and Lindsay illustrate how application of the new plausibility standard can seem arbitrary. But the two cases can in fact be reconciled by noting that the different causes of action dictated the different review of the pleading in each case. The elements necessary to establish the legal claim at issue in the case dictate the quantum of facts required to plead that claim. The Lindsay allegations of facts, taken as true, withstood dismissal because housing discrimination is adequately pleaded by alleging the statutory bases for the claims and setting forth the factual predicate of those claims. The Lindsay plaintiffs did that. In contrast, Weisbarth was a First Amendment retaliation claim pursuant to � 1983. The mere fact that the plaintiff made comments to a work force consultant and then was terminated did not state a claim for relief. The plaintiff had to show that the comment constituted speech protected by the First Amendment. This would have required the pleading of more facts. The Weisbarth court did not get to that analysis, however, because it decided, as a matter of law, that because the plaintiff spoke pursuant to her “official duties,” the firing could not have violated her free speech rights. 2007 WL 2403659, at *7-*8. If a case could not have passed Conley‘s muster, it does not satisfy the Twombly standard, which is the same as Conley for some causes of action but higher for other causes of action. Many courts faced with factual allegations in cases in the former category merely cite to Twombly and dismiss the claims without referencing or undertaking a plausibility analysis. Accordingly, many courts have declined, on the case before them, to opine as to whether the Twombly plausibility standard applies outside the antitrust conspiracy context, finding the complaint before them deficient under the “old” standard. For example, in Parmenter v. WalMart Stores, No. 3:06cv1585, 2007 WL 2071625 (D. Conn. July 17, 2007), the court granted dismissal of an Age Discrimination in Employment Act claim and other employment claims, finding the complaint deficient under the “Rule 12(b)(6) pleading regime in effect prior to Bell Atlantic.” Therefore, “ the Court does not pass upon whether such amplification [with factual allegations] is required.” See also Walker v. Woodford, No. 05cv1705, 2007 U.S. Dist Lexis 60905 (S.D. Calif. Aug. 20, 2007) (adopting magistrate judge’s recommendation to dismiss pro se prisoner’s constitutional claims, noting that “new standard” of Twombly does not affect the outcome of the court’s rulings). The abrogation of Conley‘s “no set of facts” language, then, affects only the latter category of cases in which the alleged facts, when taken as true, would render the claim merely possible, but not plausible. When is amplification required? Amplification of factual allegations will be required “in those contexts where such amplification is needed to render the claim plausible.” Iqbal, 490 F.3d at 158. For example, in Equal Employment Opportunity Commission v. Concentra Health Services Inc., No. 06-3436, 2007 WL 2215764 (7th Cir. Aug. 3, 2007), the 7th Circuit reversed the district court and dismissed allegations of sexual harassment. The Equal Employment Opportunity Commission, it found, “pleaded itself out of court” because it couldn’t clear two easy hurdles articulated by Twombly. First, a complaint has to give fair notice of the claim and the grounds upon which it rests, and second, the allegations must plausibly suggest a right to relief. Here, the alleged victim’s “report of a sexual affair is logically consistent with the possibility that the affair was caused by quid-pro-quo sexual harassment, but it does not suggest that possibility.” The court noted that the result may have been different under Conley. In Goldstein v. Pataki, 488 F. Supp. 2d 254 (E.D.N.Y. 2007), the court applied Twombly‘s plausibility standard in dismissing a condemnation claim brought under an “impermissible public use” theory, and held that the accusation was not “plausible” when the plaintiffs did not allege any facts to show that the state intended to confer benefits to a particular private party. And in Gibson v. Hunt, No. 1:06-CV-3059, 2007 WL 2001733 (N.D. Ga., July 05, 2007), the court applied Twombly‘s plausibility standard in dismissing a pro se petitioner’s challenge to his parole denial, which was brought on the ground that the defendants relied on false information. Prior to Twombly, the court had dismissed various due process claims, but allowed the false information claim to proceed under Conley. After Twombly, the court concluded, the false information claim was no longer viable. See also Shenango Inc. v. American Coal Sales Co., No. 2:06-cv-149, 2007 WL 2310869, (W.D. Pa. Aug. 9, 2007) (applying Twombly plausibility standard to dismiss shareholder litigation); Aktieselskabet AF 21 v. Fame Jeans Inc., No. 06-585, 2007 WL 1655877 (D.D.C. June 7, 2007) (applying Twombly‘s plausibility standard to a U.S. trademark infringement and Lanham Act case); In re Graphics Processing Units Antitrust Litigation, No. C 06-07417, 2007 WL 2127577 (N.D. Calif. July 24, 2007). Thus, Twombly charges federal courts with performing a more extensive prediscovery review of the factual allegations in pleadings. If the alleged facts are as consistent with behavior that is not wrongful as with wrongful behavior, and amplification of the factual allegations is not set forth, the courts will dismiss the claim. Thus, some claims now require more than others to state a claim and withstand dismissal. In each case the court must look to see if the elements of the claim have been plausibly pleaded � in the case of negligence the statement of negligence is enough to establish plausibility, but in other areas the conclusory statement is not enough. M. Norman Goldberger ([email protected]) is a partner and former chairman of the business litigation department, and Justine M. Kasznica ([email protected]) is a litigation associate, in the Philadelphia office of Wolf, Block, Schorr and Solis-Cohen. Colleen F. Coonelly ([email protected]) is the director of professional development in the Philadelphia office of Ballard Spahr Andrews & Ingersoll.

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

For questions call 1-877-256-2472 or contact us at [email protected]

 
 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.