127 S.Ct. 1955 (2007)
Supreme Court of the United States, 2007.
Plaintiff, Twombly, brought a class action antitrust suit against Bell Atlantic alleging the defendants had agreed not to compete with each other and conspired to prevent the entry of competitors within their respective territories. The District Court granted Bell Atlantic’s 12(b)6 motion to dismiss on the grounds that Twombly’s complaint failed to include a factual allegation that would “tend to exclude” independent self-interest as an explanation for defendants’ parallel conduct. On appeal, the Second Circuit reversed and remanded on the grounds that a heightened pleading standard does not apply in the context of antitrust litigation. Bell Atlantic argues that application of the “tend to exclude” standard is necessary to filter frivolous lawsuits. Twombly responds that the “tend to exclude” standard is contrary to the pleading requirements under the Federal Rules of Civil Procedure and would unfairly block meritorious antitrust suits.
-United States District Court (S. NY) dismissed the complaint for failure to state a claim upon which relief can be granted.
-Found Pl.’s allegations of parallel ILEC actions to discourage competition inadequate b/c: “the behavior of each ILEC in resisting the incursion of CLECs is fully explained by the ILEC’s own interests in defending its individual territory.
-Court of Appeals, Second Circuit Reversed - District Court tested complaint by the wrong standard.
-”Plus factors are not required to be pleaded to permit an antitrust claim based on parallel conduct to survive dismissal.
-Supreme Court of the United States grants certiorari to address the proper standard for pleading an antitrust conspiracy through allegations of parallel conduct and now reverses.
Is a complaint alleging that defendants engaged in parallel conduct and that they participated in a "conspiracy" sufficient to state a claim under section 1 of the Sherman act, 15 U.S.C. § 1, even if the complaint does not assert any factual allegations that, if proven true, would necessarily establish the existence of a conspiracy?
Sherman Act § 1-”does not prohibit all unreasonable restraints of trade...but only restraints effected by a contract, combination, or conspiracy.
[What must a Pl. plead in order to state a claim under § 1 of the Sherman act?]
-Federal Rule of Civil Procedure 8(a)(2) requires only “a short and plain statement of the claim showing that the pleader is entitled to relief” in order to “give the defendant fair notice of what the claim is and the grounds upon which it rests.”
-On a motion to dismiss, courts “are not bound to accept as true a legal conclusion couched as a factual allegation.” [A] Factual allegations must be enough to raise a right to relief above the speculative level.
-A well pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and “that a recover is very remote and unlikely.”
-”It is one thing to be cautious before dismissing an antitrust complaint in advance of discovery..but quite another to forget that proceeding to antitrust discovery can be expensive.
“A district court must retain the power to insist some specificity in pleading before allowing a potentially massive factual controversy to proceed.”
[A]The threat of discovery expense will push cost-conscious defendants to settle even anemic cases before reaching those proceedings.
-When we look at the plausibility of this complaint, we agree with the District Court that Pl.’s claim of conspiracy in restraint of trade comes up short.
-Because PL.’s here have not nudged their claims across the line from conceivable to plausable, their complaint must be dismissed.
Reasoning: Complaint must be more than a reasonably founded hope of finding evidence. Plaintiff must show plausibility of a claim to be a proper complaint. How much to you have to say to state a sufficient claim? Conley standard is that it only can be dismissed if no set of proven facts would prove the case. Twombly narrows Conley to say that the complaint must be “plausible” on the stated facts and plaintiff must show some fact that makes it plausible, not just a set of facts that have two possible interpretations.
link to case: http://scholar.google.com/scholar_case?case=18057384228100022643&hl=en&as_sdt=2&as_vis=1&oi=scholarr
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