Tagged: Twombly/Iqbal

Antitrust Pleading Standards: A(nother) Cautionary Tale

A New Jersey federal district court’s March 18th opinion granting defendants’ motions to dismiss an antitrust complaint is yet another reminder of the need to inject precision and factual detail into an antitrust claim in order to meet the strict pleading requirements applicable to such claims. The putative class of indirect purchaser plaintiffs in In re Ductile Iron Pipe Fittings (“DIPF”) Indirect Purchaser Antitrust Litigation brought a total of ten claims, alleging principally that iron pipe fitting manufacturers and distributors conspired to fix prices and monopolized the domestic iron pipe fitting market in violation of Sherman Act Sections 1 and 2. In holding that the pleadings failed to establish antitrust impact with sufficient specificity (but granting plaintiffs leave to amend their complaint), the Court reasoned as follows:

Third Circuit Sets High Bar for Proof of Price-Fixing, Affirms Dismissal on Summary Judgment Based on Twombly

The Third Circuit’s July 27, 2012, opinion in Superior Offshore International, Inc. v. Bristow Group, Inc., confirms that an antitrust plaintiff relying on circumstantial evidence of price-fixing must demonstrate something more than merely parallel behavior, not only to survive a motion to dismiss, as the Supreme Court held in Bell Atlantic Corp. v. Twombly, but also to defeat summary judgment. Thus, unless a plaintiff can present record evidence that is plausibly suggestive of, and not just consistent with, an illegal agreement to fix prices, a defendant moving for summary judgment should prevail. Indeed, without evidence of a manifest agreement not to compete, Superior Offshore International (“SOI”) suggests that courts will not infer an illegal price-fixing arrangement even where participants in an oligopoly market raise prices despite a weakening of demand for their services.

Third Circuit Addresses Tension Between Rules 8(a) and 9(b), Concluding That False Claims Act Plaintiffs Were Required to Meet Twombly/Iqbal Standard When Alleging Knowledge

The Third Circuit has made it clear that the Twombly/Iqbal pleading standard — which requires plaintiffs to plead enough facts to state a claim “that is plausible on its face” — applies to allegations of states of mind, such as knowledge and intent, notwithstanding Rule 9(b)’s allowance that such matters “may be alleged generally.”

Delaware Supreme Court Endorses Reasonable “Conceivability” on Motion to Dismiss Over Twombly-Iqbal’s “Plausibility” Standard

Since the U.S. Supreme Court’s decisions in Bell Atlantic Corp. v. Twombly in 2007 and Ashcroft v. Iqbal in 2009, many Delaware Court of Chancery decisions have applied the Twombly-Iqbal “plausibility” standard in ruling on motions to dismiss. In its recent decision in Central Mortgage Company v. Morgan Stanley Mortgage Capital Holdings LLC, however, the Delaware Supreme Court refused to apply the Twombly-Iqbal “plausibility” standard and, instead, held that — at least for now — Delaware’s less stringent reasonable “conceivability” standard is what governs motions to dismiss in Delaware courts.