Thursday, May 28, 2009

Brunet on the Origins of Plausibility as a Pleadings Standard

A lot of people have been writing about the new pleading standards lately.  One very intriguing observation was offered by Prof. Edward Brunet (Lewis & Clark Law School).  Brunet is the author of a treatise on summary judgment and links summary judgment and the new pleadings standards.  The concept of "plausibility," he writes, is imported from substantive law of antitrust, now morphed into pleadings doctrine.  His full analysis is below.  

            I think the origin of a plausible assessment of the nonmovant's case was based in substantive antitrust law. In Matsushita(1986 trilogy) the p word is used 10 times.  However, the context of usage of the word is substantive antitrust law and not Rule 12(remember this was a summary judgment case).  What Matsushita meant is that antitrust is hostile to predation cases, particularly those in which  the plaintiff cannot demonstrate proof  of  recoupment  of  the defendant's costs expended in phase one of a predation case ( the price cutting phase).  The plaintiffs' case was implausible because it was incredible that a monopolist would lose money on its U.S. sales for a lengthy 25 year phase one.

The Matsushita majority also made a substantive point when asserting that "antitrust law limits the range of permissible inferences from ambiguous evidence in a section one case.”  In other words, the term plausible was not intended to be a procedural yardstick in all cases but, instead, had a substantive antitrust meaning.  This reading  was bolstered by Matsushita's citation and quotation from Monsanto (1984) (another antitrust case and one not involving pleading) requiring the antitrust plaintiff who seeks to avoid summary judgment to have proof that "tends to exclude the possibility" of independent conduct.

As early as 1969 in the Cities Service case, the Supreme Court used the p word (plausible) when describing a plaintiff's antitrust theory and its ability to overcome a Rule 56 motion.  So, up to the plate goes Justice Souter who reinterprets "plausible" in a procedural way in Twombly. And Justice Kennedy ignores the substantive antitrust meaning of "plausible" in Iqbal.  My theory is based upon a willingness to have cause of action specific norms and flies in the face of a purely trans-substantive set of motion rules. 


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