Tuesday, June 2, 2009
Plausibility pleading is a rough procedural analogue to the tort doctrine of res ipsa loquitur.
Res ipsa translates from the Latin into "the thing speaks for itself." The idea is that there are some types of accidents that could not occur absent the defendant's negligence. In those cases, courts can infer defendant's negligence from the fact that the accident occurred. Some courts and commentators interpret this as a rebuttable presumption, others as a permissible inference that the jury can draw. You may remember the case of Byrne v. Boadle, involving a barrel of flour that fell from a high window hitting the plaintiff on the head.
How is plausibility pleading like res ipsa loquitur? Plausibility pleading provides a presumption in favor of cases that present familiar scenarios, whereas in complaints presenting unfamiliar or disfavored claims, more proof is required of the plaintiff to survive a motion to dismiss. Consider the case presented in Form 11 of the FRCP. The facts of the complaint are "On [date] and [place] defendant negligently drove a motor vehicle against plaintiff." One might say that this Form would not pass muster under Twombly and Iqbal because it is "conclusory." This complaint provides no facts as to how the defendant drove that might constitute negligence: Did the defendant drive over a curb? Did she run a red light? The counterargument is that because car accidents are often caused by negligence, the plaintiff is given a presumption that she will be able to show negligence after discovery without having to prove the fact at the complaint stage. (Note that I am not saying that the tort doctrine of res ipsa would actually apply in such a case; it would not. The point is simply that the plaintiff's case can move forward on the basis of the presumption). Similarly, in Erickson v. Pardus, perhaps the Court thought that prisoner mistreatment is sufficiently common and familiar that a presumption in favor of the plaintiff's allegations is appropriate.
On the other hand, where complaints allege conspiracy (either antitrust conspiracy as in Twombly or conspiracy to violate civil rights as in Iqbal), no presumption that the allegation is true is appropriate. The problem is not that the allegation is "conclusory" -- the term the court uses -- but rather than the allegation is not deserving of a presumption that it is true and therefore plaintiff must marshal more facts to prove her claim. This analysis works equally well if you prefer to say that certain kinds of cases give rise to a permissible inference whereas others do not. (For an analysis along these lines see Robert Bone, Twombly, Pleading Rules and the Regulation of Court Access).
What does this analogy get us? Two suggestions. First, this points out that the real issue in these cases is one of proof - a problem not traditionally at issue in our jurisprudence on motions to dismiss. An issue of fact (was there a conspiracy?) is converted into an issue of law (is it plausible to say there was a conspiracy?). Second, the plausibility standard permits a great deal of subjectivity on the part of the deciding judge. What claims seem to speak for themselves depends on the judge's experience and/or preconceptions regarding what claims are legitimate (i.e. comport with the judge's "common sense").
The NYTimes' Jonathan Glater has a great article on financial firms that invest in large-scale litigation (mostly large companies suing one another) called "Investing in Lawsuits - For a Share of the Awards. The link is here. They claim their returns are in excess of 20% per year. They avoid jury cases or cases raising new issues of law, because "juries are a coin toss." The example in the article is a contract/fraud cases. The article quotes Anthony Sebok (Cardozo) as saying “Having funding available for cases that are good cases, cases that from a God’s-eye point of view, so to speak, should’ve been brought, is a good thing."