Transactional pleading: A proportional approach to rule 8 in the wake of Bell Atlantic Corp. V. Twombly

Wisconsin Law Review

Volumn 2008, Issue 5, 2008, Pages 1013-1047

  Gist, Ryan ^a  

^a UNIVERSITY OF WISCONSIN   (United States)

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EID: 58649102064     PISSN: 0043650X     EISSN: None     Source Type: Journal    
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References (363)

1. See Lamer v. Norfolk S. Corp., F. App'x 629, 630 (4th Cir. 2007).
2. Id. at 630-31.
3. Complaint 11, Lanier, F. App'x 629 (No. 05-CP.02.1625).
4. FED. R. CIV. P. 8(a)(2).
5. Compare Complaint supra note 3,
6. with FED. R. CRV. P. FORM 11.
7. 127 S. Ct. 1955 (2007).
8. See id. at 1974.
9. Id. at 1975-76 (Stevens, J., dissenting).
10. 355 U.S. 41 (1957).
11. Id. at 45-46;
12. see also FED. R. CIV. P. 8(a)(2).
13. Although overly general, the characterization of two distinct standards is helpful to simplify the problem for the purposes of this Note. Inevitably there are numerous variations in the application of each standard presented here.
14. See 355 U.S. at 45-46.
15. See Cash Energy, Inc. v. Weiner, 768 F. Supp. 892, 898 (D. Mass. 1991).
16. See David M. Roberts, Fact Pleading, Notice Pleading, and Standing, 65 CORNELL L. REV. 390, 401 (1980).
17. See id.
18. See, e.g., Jackson v. Marion County, 66 F.3d 151, 153 (7th Cir. 1995) ("[A] plaintiff in a suit in federal court need not plead facts; he can plead conclusions.").
19. Swierkiewicz v. Sorema, NA., 534 U.S. 506, 512 (2002);
20. Tang v. App. Div. of N. Y. Supreme Ct., 487 F.2d 138, 145 (2d Cir. 1973) (noting that the purpose of FRCP 8 is to prevent surprise).
21. Swierkiewicz, 534 U.S. at 512;
22. see also FED. R. CIV. P. 56(c).
23. See, e.g., Sutliff, Inc. v. Donovan Co., 727 F.2d 648, 654 (7th Cir. 1984);
24. Cash Energy, Inc. v. Weiner, 768 F. Supp. 892, 894 (D. Mass. 1991).
25. Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1969 (2007).
26. Id. at 1964, 1969.
27. Since Twombly, both lawyers and judges have seized its language to impose or advocate for a higher standard in a particular case. See, e.g., Ass'n of Cleveland Fire Fighters v. City of Cleveland, 502 F. 3d 545, 548 (6th Cir. 2007);
28. Anderson v. Sara Lee Corp., 508 F.3d 181, 188 n.7 (4th Cir. 2007);
29. Choyce v. Saylor, No. C 07-2394 PJH (PR), 2007 WL 3035406, at *1 (N.D. Cal. Oct. 16, 2007).
30. Charles E. Clark, Special Pleading in the "Big Case, "21 F.R.D. 45, 48 (1958) ("[I]n federal pleading no special exceptions have been created for the 'Big Case' or for any other particular type of action.").
31. See Roberts, supra note 14, at 414 (noting that pleading may become "a game of forecasting the idiosyncratic predilections" of a given judge).
32. If different pleading standards are allowed to evolve separately within the circuits, when personal jurisdiction exists in multiple venues plaintiffs will naturally choose courts that judge the pleadings liberally, while defendants will seek transfer to a venue that applies a more restrictive standard. Cf. Guaranty Trust Co. v. York, 326 U.S. 99, 109 (1945) (considering the perils of forum shopping).
33. CHARLES DICKENS, BLEAK HOUSE 5-6 (Duane DeVries ed., Thomas Y. Crowell Co. 1971) (1853).
34. For additional satire of the perils of fact pleading, see GEORGE HAYES, CROGATE'S CASE: A DIALOGUE IN YE SHADES, ON SPECIAL PLEADING REFORM (1854) and SIR FREDERICK POLLACK, THE GENIUS OF THE COMMON LAW 27-37 (1912).
35. See Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1975-76 (2007).
36. In comparison to fact pleading, the liberal interpretation of FRCP 8 represents a reaction against it, while the restrictive standard is similar in some respects.
37. 5 CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 1202 (3d ed. 2004).
38. Charles E. Clark, The Handmaid of Justice, 23 WASH. U. L.Q. 297 (1938),
39. reprinted in PROCEDURE - THE HANDMAID OF JUSTICE: ESSAYS OF JUDGE CHARLES E. CLARK 77 (Charles Alan Wright & Harry M. Reasoner eds., 1965).
40. Id.
41. Richard L. Marcus, The Revival of Fact Pleading under the Federal Rules of Civil Procedure, 86 COLUM. L. REV. 433, 437 (1986).
42. Frazier v. S.E. Penn. Transp. Auth., 785 F.2d 65, 66 (3d Cir. 1986);
43. see also 5 WRIGHT & MILLER, supra note 29, § 1202.
44. Clark, supra note 30, at 77.
45. Marcus, supra note 32, at 437.
46. See Frazier, 785 F.2d at 66.
47. Authored by David Dudley Field, the Field Code was adopted by New York in 1848 and was adopted by most states within ten years. Roberts, supra note 14, at 395 & n.32.
48. Id. at 395.
49. Id. at 396.
50. Fact pleading is the moniker associated with common-law and code pleading. See id. at 390-96.
51. Common-law pleading began as a simple, oral process; the Field Code was intended to be similarly simple and concise, and we know what happened to both. Richard L. Marcus, The Puzzling Persistence of Pleading Practice, 76 TEX. L. REV. 1749, 1750-55 (1998).
52. In this context, efficiency refers to the ability of the system to dispose of claims at the earliest possible stage of the legal process allowing the courts to concentrate on other matters.
53. As the United States inherited its pleading practice from the English courts, the roots of our current system can actually be traced beyond two centuries. See Marcus, supra note 41, at 1752-53.
54. Cf. id. at 1749 (noting that the principal drafter of FRCP 8, Judge Charles Clark, originally intended to eliminate pleading motions completely).
55. Swierkiewicz v. Sorema, 534 U.S. 506, 510 (2002) (noting there is no requirement that the facts in the complaint constitute a "prima facie" case);
56. Jackson v. Marion County, 66 F.3d 151, 153 (7th Cir. 1995) (plaintiffs can plead conclusions);
57. Karim-Panahi v. L.A. Police Dept., 839 F.2d 621, 624 (9th Cir. 1988) (plaintiffs can plead "bare allegation[s]");
58. see Clark, supra note 23, at 47 ("The . . . effect and intent of the rules is to permit the claim to be stated in general terms ....").
59. But see Chongris v. Andover, 811 F.2d 36, 37 (1st Cir. 1987) (holding that plaintiffs cannot rely on "bald assertions, unsupportable conclusions, and opprobrious epithets "(internal quotations omitted)).
60. Conley v. Gibson, 355 U.S. 41, 45-46 (1957).
61. Swierkiewicz, 534 U.S. at 514.
62. FED. R. CIV. P. FORM 11. The forms are intended to be examples of pleadings sufficient to survive a motion to dismiss.
63. See FED. R. CIV. P. 84.
64. While Form Eleven replaced Form Nine with the 2007 amendment to the Rules, the changes to the form are semantic and have no effect on the minimalist standard represented by the form. Compare FED. R. CIV. P. FORM 11
65. with FED. R. CIV. P. FORM 9 (2007).
66. FED. R. CIV. P. FORM 11.
67. Cf. 5 WRIGHT & MILLER, supra note 29, § 1202 (noting that some have said under the FRCP "a sixteen year old" should be capable of drafting a pleading sufficient to survive a motion to dismiss).
68. Swierkiewic, 534 U.S. at 512. In 1984,
69. Professor Arthur Miller commented that the motion to dismiss had last been effectively used under the McKinley administration. ARTHUR MILLER, THE AUGUST 1983 AMENDMENTS TO THE FEDERAL RULES OF CIVIL PROCEDURE: PROMOTING EFFECTIVE CASE MANAGEMENT AND LAWYER RESPONSIBILITY 8 (1984).
70. See Educadores Puertorriqueños en Acción v. Hernández, 367 F.3d 61, 67 (1st Cir. 2004) (noting that although courts applying this standard have set the pleading threshold low, notice pleading is not a "toothless tiger"
71. (quoting Dartmouth Review v. Dartmouth Coll., 889 F.2d 13, 16 (1st Cir. 1989))).
72. Even Judge Clark conceded that there is a limit to the liberal standard. Anderson v. United States, 182 F.2d 296, 297 (1st Cir. 1950).
73. Marcus, supra note 32, at 460. Other commentators have gone further to suggest that the pleadings are only intended to generally indicate the type of litigation and address procedural questions such as the statute of limitations.
74. Yoichiro Hamabe, Functions of Rule 12(b)(6) in the Federal Rules of Civil Procedure: A Categorization Approach, 15 CAMPBELL L. REV. 119, 125 (1993).
75. Scheuer v. Rhodes, 416 U.S. 232, 236 (1974).
76. Id.
77. The fear of the hypertechnical vestiges of fact pleading is a brooding omnipresence over the liberal interpretation of FRCP 8. See Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1976 (Stevens, J., dissenting). These normative policies make sense provided that the role they create for the procedural system as a whole is what we want the system to look like.
78. Hickman v. Taylor, 329 U.S. 495, 500 n.2 (1947)
79. (quoting Edson R. Sunderland, The Theory and Practice of Pre-Trial Procedure, 36 MICH. L. REV. 215, 216 (1937)).
80. See Clark, supra note 30, at 83.
81. See Marcus, supra note 41, at 1770 ("Subjecting most of the docket to active pleading practice would compound the work required . . . .").
82. See Clark, supra note 30, at 80 (noting that detailed pleading requirements prevent lawyers from taking advantage of favorable evidence that develops later).
83. Hickman, 329 U.S. at 500 n.2
84. (quoting Sunderland, supra note 57, at 216);
85. Paul D. Carrington, Making Rules to Dispose of Manifestly Unfounded Assertions: An Exorcism of the Bogy of Non-Trans-Substantive Rules of Civil Procedure, 137 PA. L. REV. 2067 (1989).
86. It is important to note that some evidence can be presented at the pleadings stage in the form of exhibits attached to the complaint. FED. R. CIV. P. 10(c).
87. Charles E. Clark, Simplified Pleading, 2 F.R.D. 456, 461-62 (1943).
88. This problem is apparent in the difficulty that courts have had in controlling discovery. See Frank H. Easterbrook, Discovery as Abuse, 69 B.U. L. REV. 635, 638 (1989). At least early in the discovery process, courts are no more informed than they are when deciding a motion to dismiss.
89. See id. As a result, it is difficult for courts to determine whether a given request is legitimate or abusive.
90. See id. If courts are ill equipped to control discovery then, on the same logic, they are incapable of making an informed decision on the merits of the case.
91. See FED. R. CIV. P. 56(e)(2);
92. see also Bias v. Advantage Int'l, Inc., 905 F.2d 1558, 1561 (D.C. Cir. 1990)
93. (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)).
94. See Marcus, supra note 32, at 454, 460. Marcus gives the example of plaintiffs' failure to allege their status as "purchasers or sellers," which is an element of a securities-fraud claim.
95. Id. at 460. The court is similarly equipped when the plaintiff pleads himself out the door by including enough detail to allow the court to conclude that a legal wrong could not have occurred.
96. See Jackson v. Marion County, 66 F.3d 151, 154 (9th Cir. 1995) ("[N]othing in the federal rules forbids the filing of prolix complaints. If plaintiffs' lawyers want to live dangerously . . . they can.").
97. Marcus, supra note 32, at 459. Examples of these types of claims include those involving motive or intent, where the court should be wary of disposition without trial or even without discovery.
98. See Poller v. Colombia Broad. Sys., Inc., 368 U.S. 464, 473 (1962). Compare this to a requirement that the plaintiff is a buyer or seller of stock.
99. See Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 341 (2005).
100. A common-sense analog would be asking (1) Is the light on or off?, or (2) How bright is the light?
101. Marcus, supra note 32, at 471 ("The risks associated with heightened scrutiny ... are not... permissible as part of the trial court's discretion.").
102. Id. at 459.
103. Rex R. Perschbacher & Debra Lynn Basset, The End of Law, 84 B.U. L. REV. 1, 16 (2004).
104. See Nagler v. Admiral Corp., 248 F.2d 319, 322 (2d Cir. 1957);
105. Atwood v. Humble Oil & Ref. Co., 243 F.2d 885, 888-89 (5th Cir. 1957);
106. Rennie & Laughlin, Inc. v. Chrysler Corp., 242 F.2d 208, 213 (9th Cir. 1957);
107. Cooper v. R. J. Reynolds Tobacco Co., 234 F.2d 170, 173 (1st Cir. 1956).
108. Poller v. Colombia Broad. Sys. Inc., 368 U.S. 464, 491 (1962) ("It is only when the witnesses are present and subject to cross-examination that their credibility and the weight to be given their testimony can be appraised.").
109. See id.
110. Marcus, supra note 32, at 493 (characterizing pleading practice as "little better than an expensive waste of time");
111. see also Carrington, supra note 61, at 2070.
112. See MILLER supra note 51, at 8. Dismissal resulting in a final judgment has been cited as occurring in as little as 2 percent of cases and as much as 6 percent.
113. See THOMAS E. WILLGING, FED. JUDICIAL CTR., USE OF RULE 12(B)(6) IN TWO FEDERAL DISTRICT COURTS 9 (1989). As discussed later, proponents of the restrictive standard would contend that efficiency would be achieved if this percentage was (and should be) higher.
114. See Clark, supra note 62, at 458;
115. see also Dioguardi v. Durning, 139 F.2d 774, 775 (2d Cir. 1944).
116. See Marcus, supranote 41, at 1767 ("[Defendants ... are more likely to profit from specifics in complaints and more likely to look on pleading motions as beneficial.").
117. Christine Hurt, Counselor, Gatekeeper, Shareholder, Thief: Why Attorneys Who Invest in Their Clients in a Post-Enron World Are "Selling Out, " Not "Buying In, " 64 OHIO ST. L.J. 897, 949 (2003) ("If the plaintiffs cause of action against the attorney survives a motion to dismiss, then expensive discovery will commence and the settlement value of the case increases.").
118. This may stem from beliefs in the American legal system that the plaintiff is the master of his claim. See, e.g., The Fair v. Kohler Die & Specialty Co., 228 U.S. 22, 25 (1913);
119. Pinney v. Nokia, Inc., 402 F.3d 430, 442, (4th Cir. 2005) ("The general rule, of course, is that a plaintiff is the 'master of the claim.'"
120. (quoting Caterpillar, Inc. v. Williams, 482 U.S. 386, 392 (1987))).
121. See, e.g., Jackson v. Marion County, 66 F.3d 151, 154 (7th Cir. 1995).
122. Clark, supranote 62, at 457;
123. Marcus, supranote 41, at 1769.
124. See New England Data Servs. v. Becher, 829 F.2d 286, 290-91 (1st Cir. 1987).
125. See id.
126. See Walker v. Mortham, 158 F.3d 1177, 1192 (11th Cir. 1998).
127. Cash Energy, Inc. v. Weiner, 768 F. Supp. 892, 900 (D. Mass. 1991) ("Where there are multiple defendants . . . and where the plaintiff was not directly involved in the alleged transaction, the burden on the plaintiff to [plead facts] is not realistic."
128. (quoting Becher, 829 F.2d at 291));
129. FDIC v. Kerr, 637 F. Supp. 828, 834 (W.D.N.C 1986);
130. Chambers Dev. Co. v. Browning-Ferris Indus., 590 F. Supp. 1528, 1538 (W.D. Pa. 1984);
131. Rich-Taubman Assocs. v. Stamford Rest. Operating Co., 587 F. Supp. 875, 880 (S.D.N. Y. 1984);
132. Merrit v. Libby, McNeill & Libby, 510 F. Supp. 366, 373 (S.D.N.Y. 1981). These cases address the application of the more stringent requirements of FRCP 9 - the logic applies to FRCP 8 with even more force.
133. Cf. Poller v. Colombia Broad. Sys., Inc., 368 U.S. 464, 473 (1962) (applying this theory to all summary procedures). Of course not all courts share this concern.
134. See, e.g., Wayne Inv., Inc. v. Gulf Oil Corp., 739 F.2d 11, 14 (1st Cir. 1984);
135. Schlick v. Penn-Dixie Cement Corp., 507 F.2d 374, 379 (2d Cir. 1974).
136. Twain and Yacht Disappear at Sea, N.Y. TIMES, May 4, 1907, at Al.
137. See generally Leland Locke Tolman, Advisory Committee's Proposals to Amend the Federal Rules of Civil Procedure, 40 A.B. A. J. 843, 844 (1954);
138. Leon R. Yankwich, "Short Cuts" in Long Cases: A Commentary on the Report Entitled Procedure in Anti-Trust and Other Protracted Cases Adopted by the Judicial Conference of the United States, Sept. 26, 1951, 13 F.R.D. 41 (1953). An attempt to resurrect fact pleading by amending FRCP 8's "a short and plain statement" with "the facts constituting the cause of action" was made less than ten years after the FRCP were adopted.
139. Tolman, supra, at 844. This attempted amendment has been labeled as a "guerrilla attack" on notice pleading.
140. RICHARD H. FIELD ET AL., MATERIALS FOR A BASIC COURSE IN CIVIL PROCEDURE 439 (5th ed. 1984).
141. See Roberts, supra note 14, at 420.
142. Id.
143. See Cash Energy, 768 F. Supp. at 895-900;
144. Warth v. Seldin, 422 U.S. 490, 500 (1975).
145. See Educadores Puertorriqueños en Acción v. Hernández, 367 F.3d 61, 67 (1st Cir. 2004) (emphasizing that notice pleading is not a "toothless tiger").
146. See, e.g., Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 345-46 (2005);
147. Cash Energy, 768 F. Supp. at 897;
148. Estelle v. Gamble, 429 U.S. 97 (1976).
149. Cash Energy, 768 F. Supp. at 899.
150. Dura Pharm., 544 U.S. at 343;
151. Cash Energy, 768 F. Supp. at 899;
152. Warth, 422 U.S. at 500.
153. Ross v. A. H. Robins Co., 607 F.2d 545, 558 (2d Cir. 1979).
154. Warth, 422 U.S. at 491.
155. Id. at 501.
156. Private Securities Litigation Reform Act of 1995, Pub. L. No. 104-67, § 101, 109 Stat. 737, 744.
157. Id. § 101, 109 Stat, at 747. The statute also requires that allegations of state of mind be supported with facts sufficient to show a "strong inference" that the requisite state of mind existed.
158. Id.
159. See Sutliff, Inc. v. Donovan Cos., 727 F.2d 648, 654 (7th Cir. 1984).
160. Roberts, supra note 14, at 420.
161. Cash Energy, Inc. v. Weiner, 768 F. Supp. 892, 899 (D. Mass. 1991). Even Judge Clark, the principal drafter of FRCP 8, admitted that a more stringent standard should be applied in some situations, regardless of the language of the rules.
162. See Clark, supra note 62, at 463 ("[FRCP 9] states only what the courts would do anyhow.").
163. Cash Energy, 768 F. Supp. at 897. Although a district-court case, Cash Energy is cited frequently within this Note and other scholarship. Its continued relevance is due at least in part to the brazen language used by the court.
164. Joseph Miester, Securities Issuer Liability for Third Party Misstatements: Refining the Entanglement Standard, 53 VAND. L. REV. 947, 969-70 (2000).
165. See, e.g., Ross v. Bolton, 904 F.2d 819, 823 (2d Cir. 1990);
166. Franchise Realty Interstate Corp. v. S.F. Local Joint Exec. Bd. of Culinary Workers, 542 F.2d 1076, 1083 (9th Cir. 1976) ("We believe that the concern expressed for the danger of vexatious litigation . . . under Rule 10b-5 is . . . more substantial than the common complaint.");
167. Segal v. Gordon, 467 F.2d 602, 607 (2d Cir. 1972);
168. Decker v. Massey-Ferguson, Ltd., 534 F. Supp. 873, 877 (S.D.N.Y 1981).
169. See, e.g., Rotolo v. Charleroi, 532 F.2d 920, 921-22 (3d Cir. 1976).
170. See generally Yankwich, supra note 87.
171. See Roberts, supranote 14, at 417.
172. Samuel Issacharoff & George Loewenstein, Second Thoughts About Summary Judgment, 100 YALE L.J. 73, 73 (1990).
173. For two examples where the court acted as a coercive mediator, see Fla. Power & Light Co. v. Westinghouse Elec. Corp., 517 F. Supp. 440 (E.D. Va. 1981)
174. and Aluminum Co. of Am. v. Essex Group, Inc., 499 F. Supp. 53 (W.D. Pa. 1980).
175. See Marcus, supra note 32, at 449.
176. See, e.g., Poller v. Colombia Broad. Sys., Inc., 368 U.S. 464, 472-73 (1962).
177. See, e.g., Mitsui Foods, Inc. v. United States, 867 F.2d 1401, 1403 (Fed. Cir. 1989) ("It is well established that the grant or denial of an opportunity to amend pleadings is within the discretion of the trial court."). Under FRCP 15, a plaintiff may amend the complaint without leave of the court once within twenty days of filing and if leave is required by the court, leave should be granted freely.
178. FED. R. CIV. P. 15(a);
179. see also Foman v. Davis, 371 U.S. 178, 182 (1962).
180. This also provides justification for the preclusive effect given to successful motions to dismiss under FRCP 12.
181. When used as a justification for a more restrictive pleading standard, this argument fails in cases where the facts are uniquely within the defendant's control. See infra Part III(B)(3). Even if the plaintiff wanted to plead facts, she lacks knowledge and access before discovery.
182. Id.
183. See, e.g., Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 347-48 (2005) (criticizing a plaintiffs "groundless" claim). In Blue Chip Stamps v. Manor Drug Stores, the court noted that when the liberal standard was applied to 10b-5 securities complaints, a large number of bad complaints with little prospect for success survived motions to dismiss. 421 U.S. 723, 740 (1975).
184. Roberts, supra note 14, at 417-18;
185. see also Rotolo v. Charleroi, 532 F.2d 920, 922 (3d Cir. 1976);
186. WILLGING, supra note 75, at 13 (noting that this correlation is supported by the finding of the Federal Judicial Center that motions to dismiss civil-rights claims were 10 percent more likely to be granted, and such claims were 9 percent more likely to terminate the case completely).
187. See, e.g., Franchise Realty Interstate Corp. v. S. F. Local Joint Exec. Bd. of Culinary Workers, 542 F.2d 1076, 1083 (9th Cir. 1976);
188. Decker v. Massey-Ferguson, Ltd., 534 F. Supp. 873, 877 (S.D.N.Y 1981).
189. Jeremy T. Grabill, Southland Securities Corp. v. INSpire Insurance Solutions: The Fifth Circuit Brusquely Rejects the Group Pleading Doctrine in Light of the Private Securities Litigation Reform Act, 79 TUL. L. REV. 1101, 1103 (2005).
190. Franchise Realty, 542 F.2d at 1083-84. Judge Easterbrook characterizes such lawsuits as "impositional."
191. Easterbrook, supra note 63, at 640.
192. Franchise Realty, 542 F.2d at 1083.
193. Steve Weinberg, Hardball Discovery, A.B. A. J., Nov. 1995, at 66.
194. See FED. R. CIV. P. 26.
195. The discovery rules, FED R. CIV. P. 26-36, give lawyers the tools to further their clients' cases; thus, a zealous advocate will take full advantage. A lawyer may be perceived as less than diligent if he fails to use them aggressively.
196. See MODEL RULES OF PROF'L CONDUCT R. 1.3 (2008).
197. Easterbrook, supra note 63, at 640.
198. Id. at 640-41.
199. Id. at 637;
200. see generally Weinberg, supra note 122.
201. Easterbrook, supra note 63, at 637 ("It is the (credible) threat rather than the reality of discovery that affects the settlement of cases; and when there is some discovery, the threat is 'more of the same.' ").
202. See Archie O. Dawson, The Place of the Pleading in a Proper Definition of the Issues in the "Big Case, " 23 F.R.D. 430, 431 ("[T]he 'big case' almost necessarily presupposes 'big' discovery.").
203. See Easterbrook, supra note 63, at 640.
204. Id. at 641. A limit on the number of depositions may have no impact on a vehicular-negligence claim, while it would unfairly impede the parties to complex litigation.
205. Id. The converse also appears to be true, as a rule that properly limits discovery in multiparty corporate litigation may still leave room for abuse in a less complex case.
206. Id. at 640.
207. FED. R. CIV. P. 26(f)(2).
208. See, e.g., Franchise Realty Interstate Corp. v. S. F. Local Joint Exec. Bd. of Culinary Workers, 542 F.2d 1076, 1084 (9th Cir. 1976).
209. See id.; see also Ross v. Bolton, 904 F.2d 819, 823 (2d Cir. 1990);
210. Ross v. A.H Robbins Co., 607 F.2d 545, 557 (2d Cir. 1979);
211. Easterbrook, supra note 63, at 640.
212. A corporate officer must surrender corporate documents even if they incriminate the officer personally. Curcio v. United States, 354 U.S. 118, 125 (1957).
213. See Easterbrook, supra note 63, at 640.
214. Id.
215. United States v. City of Philadelphia, 482 F. Supp. 1274, 1277-78 (E.D. Pa. 1979).
216. This Section presents two policies: (1) protecting the exercise of free speech, and (2) encouraging effective, efficient public service. These policies are two examples of where the courts have subordinated litigants' interests in merit-based dispositions. Other such policies undoubtedly exist but have yet to be articulated by the courts.
217. Rotolo v. Charleroi, 532 F.2d 920, 921-22 (3d Cir. 1976);
218. Franchise Realty Interstate Corp. v. S.F. Local Joint Exec. Bd. of Culinary Workers, 542 F.2d 1076, 1084 (9th Cir. 1976).
219. 542 F.2d 1076 (9th Cir. 1976).
220. Id. at 1082-83.
221. Id.
222. See, e.g., Crawford-El v. Britton, 523 U.S. 574, 597-98 (1998);
223. Harlow v. Fitzgerald, 457 U.S. 800, 815 (1982);
224. Gregoire v. Biddle, 177 F.2d 579, 580-81 (2d Cir. 1949). Although these cases primarily addressed the defense of qualified immunity, the courts held that plaintiffs may properly be required to plead with particularity in the situations discussed, regardless whether the defense was raised. In the civil-rights context, it is likely that the standard discussed is also influenced by the increased prevalence of such complaints filed.
225. See supra text accompanying note 117.
226. 523 U.S. 574 (1998).
227. Id. The application of a higher standard to such claims appears to contravene the express language of the rules, as FRCP 9 states that claims involving motive and intent may be alleged generally.
228. FED. R. CIV. P. 9(b).
229. Crawford-El, 523 U.S. at 590 n. 12
230. (quoting Gregoire, 177 F.2d at 581).
231. Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1961 (2007).
232. 15 U.S.C. § 1 (2006);
233. see also Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 775 (1984).
234. Theatre Enters., Inc. v. Paramount Film Distrib. Corp., 346 U.S. 537, 540 (1954).
235. See Twombly, 127 S. Ct. at 1960.
236. Complaint ¶¶ 40-46, Twombly v. Bell Atl. Corp., 313 F. Supp. 2d 174 (S.D.N.Y. 2003) (No. 02 Civ. 10220 (GEL)).
237. Id. ¶¶ 140-41.
238. Id. ¶ 45.
239. Id. ¶¶ 42-43.
240. Id. ¶ 46.
241. The United States Court of Appeals for the Second Circuit found this to be sufficient. Twombly v. Bell Atl. Corp, 425 F.3d 99, 106-07 (2d Cir. 2005),
242. rev'd, 127 S. Ct. 1955 (2007).
243. See Swierkiewicz v. Sorema, 534 U.S. 506, 512 (2002).
244. See, e.g., Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 346-48 (2005);
245. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 582 (1985);
246. Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 741 (1975);
247. Theatre Enters., Inc. v. Paramount Film Distrib. Corp., 346 U.S. 537, 539 (1954).
248. This was exactly what the district court did. Twombly v. Bell Atl. Corp., 313 F. Supp. 2d 174, 188-89 (S.D.N.Y 2003),
249. rev'd, 425 F.3d 99 (2d Cir. 2005),
250. aff'd, 127 S. Ct. 506 (2007).
251. The circumstances of Twombly fit well within the justifications for the application of the restrictive standard discussed supra Part I.C.
252. Twombly, 127 S. Ct. at 1965-66.
253. Id. at 1974.
254. Id. at 1965.
255. Id. at 1966.
256. Id.
257. Id. at 1969.
258. Id. at 1965, 1970.
259. Id. at 1966 & n.5.
260. See id. at 1967.
261. Id. at 1965-67.
262. Id. at 1966-67.
263. Id. at 1967
264. (quoting 5 WRIGHT & MILLER, supra note 29, § 1216, 233-34).
265. Id. at 1973-74.
266. Id. at 1970-71 & n. 10;
267. see also id. at 1977 (Stevens, J., dissenting).
268. The Supreme Court is not suited for creating detailed rules for when higher and lower standards should be applied. This is the job of district courts as they confront each of these situations over time. William E. Marsh & Andrea K. Marsh, Judicial Federalism In the Southern District, 37 IND. L. REV. 629, 629 (2004).
269. See id.
270. See infra Part III. A.
271. Since Twombly, both lawyers and judges have seized its language to impose, or at least advocate for, a higher standard in a particular case. See, e.g., Ass'n. of Cleveland Fire Fighters v. City of Cleveland, 502 F.3d 545, 548, 550 (6th Cir. 2007);
272. In re Elevator Antitrust Litig., 502 F.3d 47, 50 & n.3 (2d Cir. 2007);
273. Brown v. Kerkhoff, 504 F. Supp. 2d 464, 519-22 (S.D. Iowa 2007). As of April of 2008, a KeyCite of the 5,300 cases that have cited Twombly revealed that only seven have distinguished it.
274. Less than a year after the decision, just over half of the circuits have discussed the controversial aspects of Twombly's holding in depth, and it appears that confusion is already emerging. See, e.g., Iqbal v. Hasty, 490 F.3d 143, 150 (2d Cir. 2007);
275. In re Netflix Antitrust Litig., 506 F. Supp. 2d 308, 313-14 (N.D. Cal. 2007);
276. In re Hypodermic Prod. Antitrust Litig., No. 05-CV-1602, 2007 WL 1874344, at *6 (D.N.J. June 29, 2007).
277. See supra Part I.C (noting the coexistence of a more restrictive standard).
278. Furthermore, the court is the wrong branch of government to be changing FRCP 8. Although in the past the courts have stated their reticence to usurp the legislative function by changing the rules, the existence of multiple standards makes that assertion questionable at best. See, e.g., Marsh v. Butler County, 268 F.3d 1014, 1060 (11th Cir. 2001). Thus, from a separation of powers perspective, a formal amendment is the proper approach.
279. Considering the fact that a cogent standard has not materialized in the decades since the FRCP was enacted, see supra Part I.C, it is doubtful that the courts would quickly flesh out a workable interpretation of a change to FRCP 8.
280. See Clark, supra note 30, at 6.
281. Under a rule-based system, the only way to determine the standard is to scour the reporters to find a case decided by the presiding judge that approximates the facts in issue.
282. In a diverse federal judicial system, consisting of thousands of judges reviewing tens of thousands of complaints per year, use of the term facts in the proposed standard creates a potential problem. Left uninterpreted, the language raises the specter of a return, at least in some respects, to the problems of common-law pleading. See supra Part I.A. This danger dictates that the scope of the rule be carefully defined.
283. See supra Parts I.B-C.
284. Furthermore, balancing specific criteria is not a foreign concept to the FRCP. Rules such as FRCP 24(b) and FRCP 19(b) require the court to balance specific criteria in deciding whether to allow intervention or require joinder. FED. R. CIV. P. 19(b), 24(b).
285. See, e.g., Franchise Realty Interstate Corp. v. S.F. Local Joint Exec. Bd. of Culinary Workers, 542 F.2d 1076, 1083-84 (9th Cir. 1976);
286. Schwartz v. NCNB Corp., 768 F. Supp. 164, 166 (W.D.N.C 1991) ("The Court notes the possibility that this case, as well as the others, may have been brought for its in terrorem value). The generic concern for strike suits is also used as a patent justification for the particularity requirements of FRCP 9.
287. Decker v. Massey-Ferguson, Ltd., 534 F. Supp. 873, 877 (S.D.N.Y. 1981) ("[T]he specificity requirement of Rule 9(b) serves also the purpose of discouraging 'strike suits' that might be brought by plaintiffs with largely groundless claims, relying on their in terroremeffect to argument the suit's settlement value.").
288. Jacobellis v. Ohio, 378 U.S. 184, 197 (1964) (Stewart, J., concurring) ("I shall not today attempt further to define the kinds of material I understand to be embraced within [obscenity]; and perhaps I could never succeed in intelligibly doing so. But I know it when I see it. . . ."). This also assumes, less logically, that lawyers will do the same. Even when courts do consider some of the factors that produce a likelihood of strike suits, they do so inconsistently, preventing the establishment of any sort of cogent standard.
289. See, e.g., Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955, 1988 (2007) (Stevens, J., dissenting).
290. This may be an overgeneralization; many courts applying the restrictive standard have considered the components of a strike suit. However, few have considered more than one or two, and none have attempted to define a workable standard. See, e.g., Franchise Realty, 542 F.2d at 1083;
291. Decker, 534 F. Supp. at 877.
292. This approach acknowledges that discovery and summary judgment are not the complete panacea that Clark intended, and blind application of the liberal standard has given rise to a significant threat of in terrorem strike suits. See supra Part I.B.
293. FED. R. CIV. P. 56.
294. The "significance" of a threat is a circumstantial determination made on a case-by-case basis.
295. See Twombly, 127 S. Ct. at 1967.
296. Russell Korobkin & Chris Guthrie, Psychological Barriers to Litigation Settlement: An Experimental Approach, 93 MICH. L. REV. 107, 111 (1994) (discussing the psychology behind settlement offers);
297. see David A. Hoffman, The "Duty" to Be a Rational Shareholder, 90 MINN. L. REV. 537, 571-72 n.152 (2006).
298. Daniel R. Cahoy, Medical Product Information Incentives and the Transparency Paradox, 82 IND. L.J. 623, 647 (2007).
299. Id. The impositional threat of a jury verdict may also increase when the case is one where the jury may be predisposed to find for a particularly sympathetic plaintiff.
300. Frank B. Cross, In Praise of Irrational Plaintiffs, 86 CORNELL L. REV. 1, 16 (2000) (noting that defendants may make large settlement offers to sympathetic plaintiffs);
301. Christopher A. Young, In Search of Consistency: Jury Instructions under Rule 51 of the Federal Rules of Civil Procedure, 83 IOWA L. REV. 471, 475-76 (1998) ("[J]uries may be prone to award a settlement to a sympathetic plaintiff. . . .").
302. See, e.g., Franchise Realty Interstate Corp. v. S.F. Local Joint Exec. Bd. of Culinary Workers, 542 F.2d 1076, 1082-84 (9th Cir. 1976).
303. Cf. United States v. Pole No. 3172, 852 F.2d 636, 640-41 (1st Cir. 1988) (considering a motion to dismiss under Federal Supplemental Rule of Civil Procedure E(2));
304. United States v. $39,000 in Canadian Currency, 801 F.2d 1210, 1216-18 (1986) (same).
305. See, e.g.. Bache Halsey Stuart Shields, Inc. v. Tracy Collins Bank & Trust Co., 558 F. Supp. 1042, 1045-47 (D. Utah 1983).
306. See, e.g., Franchise Realty, 542 F.2d at 1084 (antitrust);
307. Pole No. 3172, 852 F.2d at 640-41 (in rem);
308. Canadian Currency, 801 F.2d at 1218 (in rem);
309. Shapiro v. General Motors Corp., 472 F. Supp. 636, 660 (D. Md. 1979) ("Given the possibility of treble damages should the plaintiff prevail, one can readily understand that even from the outset, the in terrorem effect of an antitrust complaint has a settlement value to the plaintiff 'out of any proportion to its prospect of success at trial so long as he may prevent the suit from being resolved against him by dismissal or summary judgment.' "
310. (quoting Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 740 (1975))).
311. Although the most pressing remedy in potential strike suits is monetary, the courts must also consider the effect of proposed injunctive relief.
312. See Weinberg, supra note 122.
313. The noneconomic effects of litigation have been cited frequently as a justification for the application of a higher standard in the past. Supra Part I.C.
314. Examinations of the pleadings often ignore the fact that litigation is expensive for plaintiffs as well.
315. This approach deliberately ignores the possibility that a plaintiff may bring a grudge suit solely out of animus towards the defendant that does not benefit him financially or otherwise. See Korobkin & Guthrie, supranote 195, at 111.
316. This is a logical conclusion assuming the plaintiff is not irrational as defined by Professor Cross. See Cross, supranote 197, at 1.
317. For the purposes of this Note, judgment proof does not to refer a defendant who is unable to pay at all, but rather a defendant who cannot pay enough to make filing an impositional suit a financially viable venture for an abusive plaintiff.
318. See Korobkin & Guthrie, supra note 195, at 111.
319. Antitrust cases are commonly associated with the application of the restrictive standard, and in nearly every case the defendant could be characterized as "deep pockets." See, e.g., Tellabs, Inc. v. Makor Issues & Rights, Ltd., 127 S. Ct. 2499, 2507-09 (2007);
320. Monsanto Co. v. Spray-Rite Serv. Corp., 465 U.S. 752, 763-64 (1984);
321. Klebanow v. N. Y. Produce Exch., 344 F.2d 294, 299 (2d Cir. 1965);
322. In re Netflix Antitrust Litig., 506 F. Supp. 308, 314 (N.D. Cal. 2007);
323. Hyland v. Homeservices of Am., Inc., No. 3:05-CV-612-R, 2007 WL 2407233, at *1, 3 (W.D. Ky. Aug 17, 2007). This also may be because plaintiffs simply do not bring strike suits against judgment-proof defendants.
324. See Weinberg, supra note 122, at 103 (statement of Phillip Morris attorney, Herbert Wachtell).
325. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) ("[T]he plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery . . . . ").
326. Supra Part I.C. Unlike trial, discovery is an inevitable cost that materializes once the plaintiff survives a motion to dismiss.
327. Id.
328. See, e.g., Arista Records LLC v. Lime Group LLC, 532 F. Supp. 2d 556, 585 (S.D.N.Y. 2007) (electronic equivalent of 29 million pages of documents);
329. In re NextCard, Inc. Sec. Litig., No. C-01-21029-JF(RS), 2003 WL 23142199 (N.D. Cal. Sept. 17, 2003) (16 million pages of documents).
330. FED. R. CIV. P. 26(b)-(g);
331. see also Crawford-El v. Britton, 523 U.S. 574, 598 (1998). A court may take into account the burden or expense of the proposed discovery in relation to its benefit. The tools available to the court include limiting the number and length of depositions and interrogatories, and determining the scope and sequence of the process in general.
332. Id. at 598-99;
333. Martin v. D.C. Metro. Police Dept., 812 F.2d 1425, 1437 (D.C Cir. 1987).
334. If the court is able to control discovery, but the defendant is unaware of its capability, the danger still exists. This is because the threat of discovery, rather than the cost of discovery itself, is the basis for impositional claims. See Easterbrook, supra note 63, at 637.
335. Judge Easterbrook would likely contend that discovery can be tagged as abusive only in retrospect, thus the courts are incapable of controlling the process. See id. at 639-40. The transactional approach assumes that discovery abuse will continue, but to a lesser extent.
336. See id. at 639.
337. Id. at 645;
338. see also DM Research, Inc., v. Coll. of Am. Pathologists, 170 F.3d 53, 54-56 (1st Cir. 1999). Obviously different judges have different areas of expertise. Certain judges may understand the complex economic and biological concepts required to actively manage discovery in an antitrust dispute involving stemcell research, while others would be in the dark. Because the ability of the court to control discovery must be objectively apparent to the parties to prevent strike suits, the transactional standard rejects the relevance of subjective knowledge of the particular judge in a particular situation and instead objectively considers the average judge.
339. Easterbrook, supra note 63, at 638-39 ("We cannot prevent what we cannot detect; we cannot detect what we cannot define; we cannot define 'abusive' discovery except in theory, because in practice we lack essential information."). Under Judge Easterbrook's view, notice pleading is the primary reason why the courts are incapable of managing discovery.
340. Id. at 639.
341. Research indicates that cases managed by magistrates are even less efficient for a variety of reasons that are beyond the scope of this Note. Id. Even if assisted discovery proved to be less prone to abuse, it is unlikely that the financial resources exist to implement it outside of a minimal number of particularly complex cases.
342. The courts deal with complex issues every day that are beyond the scope of common knowledge; thus, the level of complexity must be one such that the court could not be expected to know what a particular discovery request would entail from the producing party.
343. Marcus, supra note 32, at 483.
344. Id. at 460. Professor Marcus also notes a second situation where a plaintiff pleads himself out of court by including facts that allow the court to definitively conclude the defendant has not violated the plaintiffs rights.
345. Id. at 462-63. This avenue, while valid, will exist regardless of the standard the court applies to the pleadings and thus is not discussed here.
346. See generally id. at 462-63.
347. See supra Part I. B.
348. Marcus, supra note 32, at 460.
349. Marcus notes that the law is migrating away from concrete subrules. Id. at 459-60.
350. See, e.g., Hughes v. Boston, 51 A. 1070, 1070-71 (N.H. 1902).
351. Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 347 (2005) ("[I]t should not prove burdensome for a plaintiff who has suffered an economic loss to provide a defendant with some indication of the loss and the causal connection that the plaintiff has in mind.").
352. See supra note 85 and accompanying text. This is a situation where the court could effectively allow brief discovery.
353. Charles Toutant, Candid Comments about Discovery Bring Lawyer National Notoriety, LAW.COM, Sept. 21, 2004, http://www.law.com/jsp/law/ LawArti cleFriendly.jsp?id=900005540474.
354. See Walker v. Mortham, 158 F.3d 1177, 1192 (11th Cir. 1998).
355. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973) (discussing plaintiffs' presumption).
356. See supra Part I.B.
357. Id.
358. Statutory claims that depend on private enforcement provide one example. See, e.g., Atl. Richfield Co. v. USA Petrol. Co., 495 U.S. 328, 345 (1990);
359. Cargill, Inc. v. Monfort of Colo., Inc., 479 U.S. 104, 112 (1986);
360. Hill Richards, Inc. v. Berner, 472 U.S. 299, 319 (1985).
361. See, e.g., Erickson v. Pardus, 127 S. Ct. 2197, 2200 (2007) ("[A] pro se complaint, however inartfully pleaded must be held to less stringent standards than formal pleadings drafted by lawyers.");
362. see also Hughes v. Rowe, 449 U.S. 5, 9 (1980);
363. Haines v. Kerner, 404 U.S. 519, 520 (1972).