Academic journal article St. John's Law Review

Plausible Pleading: Bell Atlantic Corp. V. Twombly

Academic journal article St. John's Law Review

Plausible Pleading: Bell Atlantic Corp. V. Twombly

Article excerpt

INTRODUCTION

Motions to dismiss antitrust cases have gone in and out of favor over the years. There was a time when plaintiffs-especially government plaintiffs-needed to plead little more than that defendants had conspired to fix prices and restrain trade. More recently, many courts began demanding appreciably more than conclusory allegations of conspiracy and unreasonable restraint of competition, including both some factual allegations and a theory of liability that makes sense.1 Meanwhile, some other courts continued to insist that pleading requirements are intended to be minimal, and that only plaintiffs pleading nothing but conclusions should be denied the opportunity for discovery.2

Through the decades, discovery itself changed dramatically. When the Federal Rules of Civil Procedure were adopted in 1938, photostats were only thirty years old and xerography had not quite been invented.3 The creators of the concept of liberal discovery could not possibly contemplate the nature or volume of the electronic data and documents that would proliferate seventy years later.

These two trends converged in Bell Atlantic Corp. v. Twombly,4 an antitrust case with broad implications for pleading all federal claims.

There can be little doubt that the Supreme Court purposefully recalibrated the pleading requirements under Rule 12(b)(6) in Twombly. In a 7-2 decision, the Court reversed the second Circuit Court of Appeals and upheld the district court's dismissal of an antitrust conspiracy complaint on the ground that the allegations of the complaint failed to provide "plausible grounds to infer an agreement."5 The High Court's opinion, authored by Justice Souter, recognized that instances of competitors responding in the same way to the same set of circumstances do not constitute evidence of conspiracy and, for this reason, "an allegation of parallel conduct and a bare assertion of conspiracy will not suffice."6 The Court pointedly observed that "antitrust discovery can be expensive," generating "reams and gigabytes of business records," and unless implausible claims are weeded out at the pleading stage, "the threat of discovery expense will push cost-conscious defendants to settle even anemic cases before reaching [summary judgment or trial]."7

The complaint in Twombly was filed on behalf of consumers of telephone service, seeking class treatment.8 The plaintiffs alleged anticompetitive conduct by local telephone companies, including refusal to deal with competitors, providing inferior connections to their networks, overcharging, and engaging in improper billing practices, coupled with a published statement by one of the company's CEOs that competition "might be a good way to turn a quick dollar but that doesn't make it right."9

This was not enough to state a claim, but it does provide plenty of insight into what will and will not suffice under the pleading standard that the Court announced.

I. NO MORE INFERRING CONSPIRACY FROM PARALLEL BEHAVIOR

Twombly effectively heralded that the days of alleging a "conceivable" antitrust conspiracy in order to survive a motion to dismiss are over. After Twombly, a complaint must allege sufficient "factual matter (taken as true)" to "plausibly suggestQ" that parallel conduct among competitors was the product of a "preceding agreement," and was "not merely parallel conduct that could just as well be independent action."10 To illustrate the kind of allegations that would suffice to meet this test, the Court pointed to allegations of the "specific time, place, [and] person involved in the alleged conspiracies"-i.e., "which [defendants] supposedly agreed" and "when and where the illicit agreement took place."11

The Court's analysis is premised on the principle that parallel decisions among competing companies to make more money or, presumably, to pursue any goal that would be in each defendant's self-interest in the absence of conspiracy,12 is not evidence of a conspiracy. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.