Since the decisions in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. _, 129 S. Ct. 1937 (2009), practitioners have been concerned about the impact the decisions would have on the standard for drafting pleadings in federal court. These decisions interpreted Fed.R.Civ.P. 8(a), and held that a plaintiff must present a “plausible” claim for relief in a complaint. In general, these cases held that a plausible claim required sufficient assertion of facts to show that the plaintiff had a claim. The general concern was that in some circumstances a plaintiff might have a good faith claim, but not sufficient facts to allege a plausible claim, thus leading to an order of dismissal under Fed.R.Civ.P. 12(b)(6) before the plaintiff could obtain discovery in support of her claims.
Recently, the Federal Judicial Center published a report addressing trends in motions to dismiss alleging that plaintiff has failed to state a claim. In Motions to Dismiss for Failure to State a Claim After Iqbal[1] (the “Report”), the authors undertook a comprehensive analysis of motions to dismiss alleging insufficient pleadings. You may view the report here. http://www.fjc.gov/public/pdf.nsf/lookup/motioniqbal.pdf/$file/motioniqbal.pdf
The Report’s Executive Summary indicates that after undertaking a thorough review of federal courts across the country there were three key conclusions: (1) a general increase in the number of motions to dismiss filed, (2) no increase in the rate of grants without leave to amend, and (3) no increase in the number of dismissals that terminated the litigation.[2] Interestingly, the authors conclude that the foreclosure crisis has had some impact on the number of motions to dismiss granted.[3] They found a marked increase in the number of motions to dismiss filed with regard to litigation over financial instruments. Id. As well, there was an increase in the number of motions granted to dismiss claims related to financial instruments without leave to amend. Id. However, the authors do not see this increase as attributable to the Iqbal standards.[4]
Setting the financial crisis aside, the authors concluded that in general plaintiffs were pleading more facts in their complaints.[5] The authors suggested that additional analysis was necessary to reach a definitive conclusion about the effect of the Iqbal standard. Nevertheless, this report shows that plaintiffs have responded by beefing up their complaints in response to the evolving standard.
[1] Cecil, Court, Williams and Batailon, Motions to Dismiss for Failure to State a Claim After Iqbal, Federal Judicial Center (2011).
[2] Id at vii.
[3] Id at p. 14.
[4] Id at p. 21.
[5] Id at p. 23.
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