Initial Pleading

• Pages: 173-200

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CHAPTER VI

INITIAL PLEADING

This chapter examines the first step in asserting a conspiracy claim

under the federal antitrust laws—pleading a cause of action. In 2009, in a

5-4 decision, the Supreme Court in Ashcroft v. Iqbal1confirmed what

many had already surmised about the pleading standard articulated by the

Court’s 2007 decision in Bell Atlantic Corp. v. Twombly.2In a break from

the long-established notice pleading standard, a complaint now must

contain sufficient factualmatter (taken as true) to state a claim for relief

that is “plausible” on its face.3

This chapter discusses how courts apply the Federal Rules of Civil

Procedure (the “Federal Rules”) to motions to dismiss in antitrust cases. It

begins by briefly revisiting the various historical phases of pleading

standards in federal courts, including common law, code, and notice

pleading. It then examines Twombly’s plausibility standard and its

rationale, impact, and nuances as refined and clarified by Iqbal. The

chapter concludes by examining the developments in federal pleading

standards as they are being applied by lower federal courts and considered

by state courts.

A.Historical Overview of Pleading in Federal Courts

1.Pleadings before the Federal Rules of Civil Procedure

Before the FederalRules were implemented, common law pleadings

required highly stylized verbal formulations to present even the simplest

1.556 U.S. 662 (2009).

2. 550 U.S. 544 (2007).

3. Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 570).

174Proof of Conspiracy Under Federal Antitrust Laws

of grievances.4Many claims were dismissed at the pleading stage on

technicalities after a lawyer had “bungled the pleading war.”5

In an attempt tobreak from the rigidity of common law pleadings,

many states adopted codes that supplied the civil pleading rules in federal

actions at law.6Most of these codes required only a statement of facts

constituting the cause of action in ordinary, concise language.7A

complaint could only state the facts—not any evidence from which they

were derived nor the conclusions of law they supported.8Because the

concepts of evidence, facts, and conclusions animated code pleading, the

rules were overly technical, easily blurred, and fostered abusive behavior.9

2.Pleading as Drafted under the Federal Rules of Civil Procedure

In 1935, the Supreme Court appointed an Advisory Committee on

Rules for Civil Procedureto draft “a unified system of general rules” to

4. SeeRichard L. Marcus, The Revival of Fact Pleading Under the Federal

Rules of Civil Procedure, 86 COLUM.L.REV. 433, 437 (1986) (“In

pleading, they studiously avoid entering into the Merits of the Cause; but

are loud, violent and tedious in dwelling upon Circumstances which are

not to the Purpose.” (quoting JONATHAN SWIFT,GULLIVER’S TRAVELS

352-53 (H. Williams ed.1926))).

5. Id.

6. Id.at 438; John M. Landry, Fact Pleading After Ashcroft v. Iqbal: The

Implications for Section1 Cartel Cases, ANT ITRUST SOURCE, October

2009, at 1, available at http://www.abanet.org/antitrust/at-

source/09/10/Oct09-Landry10-23f.pdf.

7. See, e.g., An Act to Simplify & Abridge the Practice, Pleadings &

Proceedings of the Courts of this State, ch. 379, §120(2), 1848 N.Y. Laws

497, 521 (requiring “[a] statement of the facts constituting the cause of

action, in ordinary concise language,without repetition, and in such a

manner as to enable a person of common understanding to know what is

intended”).

8. Landry, supra note6, at 438.

9. SeeJack B. Weinstein & Daniel H. Distler, Comments on Procedural

Reform: Drafting Pleading Rules, 57 COLUM.L.REV. 518, 520-21 (1957)

(“[I]t is virtually impossible logically to disting uish among ‘ultimate facts,’

‘evidence,’ and ‘conclusions.’ Essentially any allegation in a pleading must

be an assertion that certain occurrences took place. The pleading spectrum,

passing from evidence through ultimate facts to conclusions, is largely a

continuum varying only in the degree of particularity with which the

occurrences are described.”).