Adam Mcdonell Moline, Nineteenth-century Principles for Twenty-first-century Pleading

• Jurisdiction: United States,Federal
• Publication year: 2010
• Citation: Vol. 60 No. 1

NINETEENTH-CENTURY-PRINCIPLES FOR TWENTY-FIRST- CENTURY PLEADING†

ABSTRACT

Two recent Supreme Court decisions, Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal, upended the standards of pleading under the Federal Rules. In both cases, the plaintiffs had filed complaints so unsubstantiated that the Court concluded they could have no other purpose than to abuse the discovery process against the defendants. Rather than subject the defendants to these unfair burdens, the Court struck language from a fifty-year-old precedent, Conley v. Gibson, that would have allowed the suits to proceed.

The Court's solution created three new problems. Lower court judges found little guidance in its new, amorphous "plausibility" standard. Critics argued that Twombly and Iqbal would lock the gates to the federal courts. Even the decisions' supporters bristled at the Court's cavalier treatment of precedent.

This Comment solves all three of these problems. It reaches back to the writings of David Dudley Field, the great nineteenth-century legal reformer, from whose work Judge Charles E. Clark derived the Federal Rules. Consulting these two giants of civil procedure reveals Twombly and Iqbal to be consistent with the commonsense principles that Field first articulated in

1847 and Clark reaffirmed in 1938. For judges interpreting Twombly and

Iqbal, this Comment fills in those cases' gaps to propose a model of decision that unites traditional principles with the Court's new jurisprudence. For the critics, this Comment shows how tradition mandates a narrow reading of Twombly and Iqbal, allowing judges to dismiss complaints only when those complaints present the same dilemma that prompted the Court to intervene. For the supporters, this Comment shows how Twombly and Iqbal better reflect the original meaning of the Federal Rules than the caselaw the Court discarded, so that they no longer need choose between keeping faith with tradition and defending sensible pleading standards.

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INTRODUCTION .............................................................................................. 161

I. COMMENTARIES ON THE CODIFICATION WARS .................................. 163

A. Pleading at Common Law .......................................................... 164

B. Pleading Under the Field Code .................................................. 166

C. Pleading Under the Federal Rules ............................................. 169

1. Fair Notice-Rule 8's Original Meaning ............................. 169

2. No Set of Facts-"A Phrase Best Forgotten as an Incomplete, Negative Gloss on an Accepted Pleading Standard" ............................................................................. 173

II. THE RESTORATION OF FAIR NOTICE ................................................... 176

A. Plausible Notice as Story of the Case ......................................... 177

1. Story of the Case in Bell Atlantic Corp. v. Twombly ........... 178

2. Notice-Gap Analysis in Ashcroft v. Iqbal ............................. 183

B. The Court's Policy Rationale as Deference Principle ............... 186

1. Protection of Private Interests in Bell Atlantic Corp. v.

Twombly .............................................................................. 187

2. Protection of Public Interests in Ashcroft v. Iqbal ............... 190

III. TWO PRINCIPLES OF PLEADING JURISPRUDENCE ................................ 192

A. The Notice-Gap Principle ........................................................... 193

1. The Genuine Antecedent Dispute Requirement .................... 193

2. The Strong Countervailing Inference Test ............................ 198

B. The Deference Principle ............................................................. 200

1. Keeping Meritorious Cases In .............................................. 201

2. Keeping Frivolous Cases Out ............................................... 204

CONCLUSION .................................................................................................. 207

2010]	NINETEENTH-CENTURY PRINCIPLES	161
Into what dangers would you lead me, Cassius,
That you would have me seek into myself For that which is not in me?

-WILLIAM SHAKESPEARE,

JULIUS CAESAR act 1, sc. 2

INTRODUCTION

Pleading precedes jurisdiction, and so crisis in pleading threatens crisis for all the law. According to the Federal Rules of Civil Procedure, a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief."¹This crisis came about as plaintiffs began to exploit a decades-old precedent, which had interpreted this language before the advent of modern complex litigation. Conley v. Gibson,²articulating a standard that would come to be synonymous with the phrase "notice pleading," instructed that a complaint would survive a motion to dismiss³unless the plaintiff could prove "no set of facts" that would entitle him to relief.⁴So, said the plaintiffs in Bell Atlantic Corp. v. Twombly, we could sue all the major telecommunications companies in America for conspiracy in restraint of trade, subjecting them to millions of dollars in discovery costs, without first alleging any evidence that such a conspiracy had taken place.⁵So, said the plaintiff in Ashcroft v. Iqbal, I could sue the Attorney General of the United States for discrimination, gaining access to sensitive documents about national security policy, without first alleging any evidence that he had acted on any racial or religious bias.⁶If the Court had followed this precedent, all Americans would have borne the burdens: as consumers of the telecommunications companies, to whom the companies would pass those costs; and as citizens of the government, whose leaders would have no choice but to divide their time between their duties and their legal defense. Instead, the Court decided that

Conley's no set of facts standard afforded defendants too little protection from opportunistic plaintiffs, from whom federal courts would require "plausible" claims for relief before allowing their cases to proceed to discovery.⁷

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The solution to this crisis created another, because in its rush to do justice to the parties before it, the Court seemed to have disregarded the understanding of federal pleading as developed over the prior fifty years. In dissent, Justice Stevens excoriated the majority for discarding the bulk of its pleading jurisprudence under the Federal Rules.⁸Beginning immediately after the announcement of the Twombly decision, critics echoed Justice Stevens in decrying the majority's choice to overthrow the "70-year-old regime of notice pleading" and its bad faith in doing so.⁹The majority's scanty list of authorities supporting its assertion that the no set of facts standard had "been questioned, criticized, and explained away long enough"¹⁰played into this charge. The Court's confusing disposition of the case embarrassed even commentators who agreed with its result, such as Professor Richard Epstein, who described Twombly motions to dismiss as "(disguised) summary judgments."¹¹In addition, Twombly replaced the straightforward no set of facts standard with a new "plausibility" test so nebulous that in Iqbal, the original Twombly majority could not agree on how to apply it to the Iqbal complaint.¹²This left lower court judges with the task of figuring out how Twombly-Iqbal pleading should work in other areas of law.

If the Conley Court's 1957 understanding of Federal Rules pleading under Rule 8 was correct, then Justice Stevens and the chorus of naysayers have Twombly right. Twombly would exemplify "judicial activism," the practice of judges making up law as it suits them rather than adhering to a consistent methodology for deciding cases. Twombly's sins would be all the more egregious because among the members of that majority are some of the harshest critics of judicial law making.¹³

This Comment argues that the Federal Rules embody principles dating back to David Dudley Field's original pleading reforms of 1848, which Judge Clark updated rather than reinvented when he drafted the Rules on pleading. It

2010] NINETEENTH-CENTURY PRINCIPLES 163 unfolds across three parts. Part I begins by relating the problems that prompted Field's reforms. It explains Field's principles of pleading and how the courts of the time misapplied them. It shows how Judge Clark refined Field's work into Rules pleading only to have Conley misconstrue that as well. Part II argues that Twombly and Iqbal mark a return to the original meaning of the Rules. It organizes them into two principles of pleading, which this Comment calls the "notice-gap principle" and the "deference principle." Part III develops these principles of pleading into a model that judges and litigators can use to structure their analysis of pleading problems.

I. COMMENTARIES ON THE CODIFICATION WARS

Twombly's roots in the nineteenth-century pleading reform movement both explain its textual legitimacy and direct its interpretation for future cases. The pleading reform movement arose because the then-prevailing pleading standards wasted litigants' time and resources on matters unrelated to their cases' merits. The reformers, led by David Dudley Field, undertook to repurpose pleading from a ritual exercise driven by technicalities into a tool to focus cases on the real matters in dispute. Although the problem Field set out to solve differs in its particulars from the one that the Twombly Court attempted to fix, the same principle of "fair notice" connects these two generations of reformers.

The history of pleading is divided into three parts. Until the nineteenth century, pleading developed as a common law discipline. As the law had evolved, pleading rules persisted from times when courts had entertained fewer types of disputes. These rules had served to restrain courts from exceeding their limited jurisdiction, but when...