MEMORANDUM
DATE:

December 30, 2009

TO:

Civil Rules Committee
Standing Rules Committee

FROM:

Andrea Kuperman1

SUBJECT:

Review of Case Law Applying Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal

PREPARED FOR THE CONSIDERATION OF THE ADVISORY COMMITTEE ON CIVIL RULES
This memorandum addresses the application of the pleading standards after the Supreme
Court’s decisions in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, --U.S. ---, 129 S. Ct. 1937 (2009). I have been asked to continue monitoring and reviewing the case
law for the Civil Rules Advisory Committee to consider at its April 2010 meeting. Below is a short
summary of the case law, summaries of the holdings in Twombly and Iqbal, and descriptions of cases
discussing and applying Iqbal.2 The circuit court cases are described first, followed by the district

1

Andrea Kuperman is the Rules Law Clerk to Judge Lee H. Rosenthal, Chair of the Judicial Conference Committee on
Rules of Practice and Procedure.

2

A search in Westlaw reveals that, as of December 29, 2009, Iqbal had been cited more than 4,200 times, in case law
alone. Westlaw’s KeyCite function, in addition to showing any negative citing references for the case, indicates how
extensively positive citing references examine the case. The depth-of-treatment categories include “examining,”
“discussing,” “citing,” and “mentioning.” This memo includes appellate cases that are labeled in Westlaw as either
“examining” or “discussing” Iqbal, but excludes cases in those categories that do not substantively discuss the portion
of Iqbal focusing on pleading requirements. With respect to district court cases, as of December 29, 2009, there were
approximately 1,750 cases listed on Westlaw as either “examining” or “discussing” Iqbal. Because of the large number
of citations, this memo includes a sample of the district court cases, focusing largely on those that examine Iqbal in more
detail.
For the initial version of this memo, I also conducted searches for cases involving employment discrimination
claims, cases addressing the adequacy of allegations of mental state, cases addressing pleading where information is in
the opposing party’s possession, and cases addressing whether pleading “on information and belief” is sufficient. While
these searches were limited to cases addressing Iqbal, with these more pointed inquiries I did not limit the searches solely
to those cases listed as “examining” or “discussing” Iqbal. Because these searches turned up many cases, particularly
in the category of employment discrimination, this memo addresses examples drawn from those results.
Updates to this memo after the original submission on October 2, 2009 have focused largely on appellate cases
because as the number of appellate cases evaluating Iqbal has increased, it has seemed appropriate to focus on them, as
they will guide future district court cases.

court cases.

SUMMARY OF THE CASE LAW
At this early stage in the development of the case law discussing and applying Iqbal, it is
difficult to draw many generalized conclusions about how the courts are interpreting and applying
the discussion of pleading requirements in that decision. The cases recognize that Twombly and
Iqbal require that pleadings contain more than legal conclusions and contain enough detail to allow
the court to infer more than the mere possibility of misconduct. But the case law to date does not
appear to indicate that Iqbal has dramatically changed the application of the standards used to
determine pleading sufficiency. Some courts have emphasized that notice pleading remains intact.
Many courts also continue to rely on pre-Twombly case law to support some of the propositions cited
in Twombly and Iqbal—that legal conclusions need not be accepted as true and that at least some
factual averments are necessary to survive the pleadings stage. In addition, some of the post-Iqbal
cases dismissing complaints note that those complaints would have been deficient even before
Twombly and Iqbal. Even when post-Iqbal cases dismissing complaints fail to state expressly that
the allegations also would not have survived before Twombly and Iqbal, the reason may often be that
courts can easily rely on the more recent statement of the pleading standards in Twombly and Iqbal
instead of pointing to earlier case law describing similar pleading concepts. Some courts discuss
Twombly and Iqbal but dismiss based on the conclusion that the law does not provide relief, not
based on a lack of plausible facts. The approach taken by many courts may suggest that Twombly
and Iqbal are providing a new framework in which to analyze familiar pleading principles, rather
than an entirely new pleading standard.
At the same time, some cases state that Twombly and Iqbal have raised the bar for defeating

2

a motion to dismiss based on failure to state a claim. Although some of the courts making such
statements actually deny motions to dismiss and find the pleadings sufficient, there are also cases
in which courts have expressly stated or implied that the claims might have survived before
Twombly and Iqbal but do not survive under current pleading standards. At least one court has gone
so far as to intimate that Iqbal will cause certain plaintiffs to avoid federal court when possible.
While it seems likely that Twombly and Iqbal have resulted in screening out some claims that might
have survived before those cases, it is difficult to determine from the case law whether meritorious
claims are being screened under the Iqbal framework or whether the new framework is effectively
working to sift out only those claims that lack merit earlier in the proceedings.
Many of the circuit court cases emphasize that the Iqbal analysis is context-specific. This
context-specific approach may give courts some flexibility to apply the analysis more leniently in
cases where pleading with more detail may be difficult. For example, courts have continued to
emphasize that pro se pleadings are evaluated more leniently than others, and courts continue to find
pleading on “information and belief” to be appropriate when permitted under the rules and cases.
Courts also continue to frequently grant leave to amend if the complaint allegations are initially
deemed insufficient. Continued monitoring will be important to determine the results on appeal
when district courts do not grant leave to amend, and, if leave is granted, to determine whether the
pleadings are amended and the case continues to proceed.
THE TWOMBLY AND IQBAL DECISIONS
The Twombly Decision
On May 21, 2007, the Supreme Court decided Bell Atlantic Corp. v. Twombly, 550 U.S. 544
(2007). In Twombly, the Court addressed the question of “whether a § 1 [of the Sherman Act]

3

complaint can survive a motion to dismiss when it alleges that major telecommunications providers
engaged in certain parallel conduct unfavorable to competition, absent some factual context
suggesting agreement, as distinct from identical, independent action.” Id. at 548. The complaint
alleged that the “Incumbent Local Exchange Carriers” or “ILECs” had conspired to restrain trade
by “‘engag[ing] in parallel conduct’ in their respective service areas to inhibit the growth of upstart
CLECs [competitive local exchange carriers],” and by “allegedly . . . making unfair agreements with
the CLECs for access to ILEC networks, providing inferior connections to the networks,
overcharging, and billing in ways designed to sabotage the CLECs’ relations with their own
customers.” Id. at 550. The complaint also alleged “agreements by the ILECs to refrain from
competing against one another,” which could be “inferred from the ILECs’ common failure
‘meaningfully [to] pursu[e]’ ‘attractive business opportunit[ies]’ in contiguous markets where they
possessed ‘substantial competitive advantages,’ and from a statement of Richard Notebaert, chief
executive officer (CEO) of the ILEC Qwest, that competing in the territory of another ILEC ‘‘might
be a good way to turn a quick dollar but that doesn’t make it right.’’” Id. at 551 (internal record
citations omitted).
The Twombly Court first discussed the requirements for pleading under Rule 8, noting that
Rule 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.’” See id. at 555 (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). The Court
explained that “[w]hile a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need
detailed factual allegations, a plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to
relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a

4

cause of action will not do.” Id. (internal citations omitted). “Factual allegations must be enough
to raise a right to relief above the speculative level, on the assumption that all the allegations in the
complaint are true (even if doubtful in fact).” Twombly, 550 U.S. at 555 (internal citations, footnote,
and emphasis omitted). The Court emphasized that “[w]hile, for most types of cases, the Federal
Rules eliminated the cumbersome requirement that a claimant ‘set out in detail the facts upon which
he bases his claim,’ Conley v. Gibson, 355 U.S. 41, 47, 78 S. Ct. 99, 2 L. Ed. 2d 80 (1957)
(emphasis added), Rule 8(a)(2) still requires a ‘showing,’ rather than a blanket assertion , of
entitlement to relief. Without some factual allegation in the complaint, it is hard to see how a
claimant could satisfy the requirement of providing not only ‘fair notice’ of the nature of the claim,
but also ‘grounds’ on which the claim rests.” Id. at 555 n.3 (citation omitted). The Court held that
stating a § 1 claim “requires a complaint with enough factual matter (taken as true) to suggest that
an agreement was made.” Id. at 556. But the Court emphasized that “[a]sking for plausible grounds
to infer an agreement does not impose a probability requirement at the pleading stage; it simply calls
for enough fact to raise a reasonable expectation that discovery will reveal evidence of illegal
agreement.” Id. (footnote omitted).
The Court cautioned that “a well-pleaded complaint may proceed even if it strikes a savvy
judge that actual proof of those facts is improbable, and ‘that recovery is very remote and unlikely.’”
Id. (citation omitted). Because lawful parallel conduct is not enough to show an unlawful
agreement, the Court concluded that an allegation of parallel conduct and an assertion of conspiracy
were not sufficient, explaining that “[w]ithout more[,] parallel conduct does not suggest conspiracy,
and a conclusory allegation of agreement at some unidentified point does not supply facts adequate
to show illegality.” Id. at 556–57. The Court stated that its conclusion was consistent with Rule 8:

5

“The need at the pleading stage for allegations plausibly suggesting (not merely consistent with)
agreement reflects the threshold requirement of Rule 8(a)(2) that the ‘plain statement’ possess
enough heft to ‘sho[w] that the pleader is entitled to relief.’” Twombly, 550 U.S. at 557. The Court
held that ‘[a]n allegation of parallel conduct is thus much like a naked assertion of conspiracy in a
§ 1 complaint: it gets the complaint close to stating a claim, but without some further factual
enhancement it stops short of the line between possibility and plausibility of ‘entitle[ment] to
relief.’” Id. (citation omitted).
The Court expressed concern with the expense of discovery on a baseless claim, stating that
“when the allegations in a complaint, however true, could not raise a claim of entitlement to relief,
‘‘this basic deficiency should . . . be exposed at the point of minimum expenditure of time and
money by the parties and the court.’’” Id. at 558 (citations omitted). The Court seemed especially
concerned with those costs in the context of antitrust litigation: “[I]t 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.” Id. (internal citation omitted). The Court also
expressed doubts about discovery management being effective in preventing unmeritorious claims
from requiring expensive discovery, stating that “[i]t is no answer to say that a claim just shy of a
plausible entitlement to relief can, if groundless, be weeded out early in the process through ‘careful
case management,’ given the common lament that the success of judicial supervision in checking
discovery abuse has been on the modest side.” Id. at 559 (citation omitted). The Court continued:
And it is self-evident that the problem of discovery abuse cannot be
solved by “careful scrutiny of the evidence at the summary judgment
stage,” much less “lucid instructions to juries”; the threat of
discovery expense will push cost-conscious defendants to settle even
anemic cases before reaching those proceedings. Probably, then, it
is only by taking care to require allegations that reach the level
6

suggesting conspiracy that we can hope to avoid the potentially
enormous expense of discovery in cases with no “‘reasonably
founded hope that the [discovery] process will reveal relevant
evidence’” to support a § 1 claim.
Id. (internal citation omitted).
The Twombly Court also evaluated the language in Conley v. Gibson that “‘a complaint
should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff
can prove no set of facts in support of his claim which would entitle him to relief.’” Twombly, 550
U.S. at 561 (quoting Conley, 355 U.S. at 45–46). The Court explained that this statement in Conley
could not be read literally: “On such a focused and literal reading of Conley’s ‘no set of facts,’ a
wholly conclusory statement of claim would survive a motion to dismiss whenever the pleadings
left open the possibility that a plaintiff might later establish some ‘set of [undisclosed] facts’ to
support recovery. . . . It seems fair to say that this approach to pleading would dispense with any
showing of a ‘‘reasonably founded hope’’ that a plaintiff would be able to make a case.” Id. at
561–62 (citation omitted). The Court held that the “no set of facts” language from Conley should
be retired and was “best forgotten as an incomplete, negative gloss on an accepted pleading
standard: once a claim has been stated adequately, it may be supported by showing any set of facts
consistent with the allegations in the complaint.” Id. at 563 (citations omitted).
Using the foregoing principles, the Court concluded that the plaintiff’s complaint was
insufficient. The Court contrasted the conclusory allegations in the complaint with the notice given
by a complaint following Form 9:
Apart from identifying a seven-year span in which the § 1 violations
were supposed to have occurred . . . , the pleadings mentioned no
specific time, place, or person involved in the alleged conspiracies.
This lack of notice contrasts sharply with the model form for pleading
negligence, Form 9, which the dissent says exemplifies the kind of
7

“bare allegation” that survives a motion to dismiss. Whereas the
model form alleges that the defendant struck the plaintiff with his car
while plaintiff was crossing a particular highway at a specified date
and time, the complaint here furnishes no clue as to which of the four
ILECs (much less which of their employees) supposedly agreed, or
when and where the illicit agreement took place. A defendant wishing
to prepare an answer in the simple fact pattern laid out in Form 9
would know what to answer; a defendant seeking to respond to
plaintiffs’ conclusory allegations in the § 1 context would have little
idea where to begin.
Id. at 565 n.10. The Court was careful to emphasize that it was not applying a heightened or
particularized pleading standard, which is only required for those categories of claims falling under
Rule 9, and explained its “concern [wa]s not that the allegations in the complaint were insufficiently
‘particular[ized]’; rather, the complaint warranted dismissal because it failed in toto to render
plaintiffs’ entitlement to relief plausible.” Id. at 569 n.14 (internal citation omitted). The Court
concluded: “[W]e do not require heightened fact pleading of specifics, but only enough facts to state
a claim to relief that is plausible on its face. Because the plaintiffs here have not nudged their claims
across the line from conceivable to plausible, their complaint must be dismissed.” Id. at 570.
The Iqbal Decision
Two years after Twombly, the Supreme Court elaborated on the pleading standards discussed
in Twombly in Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009). In Iqbal, the plaintiff, a citizen of Pakistan
and a Muslim, was arrested on criminal charges and detained by federal officials. Id. at 1942. The
plaintiff alleged that he was deprived of constitutional rights, and sued numerous federal officials,
including former Attorney General John Ashcroft and FBI Director Robert Mueller. Id. Ashcroft
and Mueller were the only appellants.

Id.

The complaint alleged that “they adopted an

unconstitutional policy that subjected the plaintiff to harsh conditions of confinement on account
of his race, religion, or national origin.” Id.
8

The Iqbal Court explained that “the pleading standard Rule 8 announces does not require
‘detailed

factual

allegations,’

but

it

demands

more

than

an

unadorned,

the-defendant-unlawfully-harmed-me accusation.” Id. at 1949 (citing Twombly, 550 U.S. at 555).
With respect to the “plausibility” standard described in Twombly, Iqbal explained that “[a] claim has
facial plausibility when the plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 129 S. Ct. at
1949 (citing Twombly, 550 U.S. at 556). The Iqbal Court noted that “[t]he plausibility standard is
not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant
has acted unlawfully.” Id. (citing Twombly, 550 U.S. at 556). “Where a complaint pleads facts that
are ‘merely consistent with’ a defendant’s liability, it ‘stops short of the line between possibility and
plausibility of ‘entitlement to relief.’’” Id. (quoting Twombly, 550 U.S. at 557). The Court
explained:
Two working principles underlie our decision in Twombly. First, the
tenet that a court must accept as true all of the allegations contained
in a complaint is inapplicable to legal conclusions. Threadbare
recitals of the elements of a cause of action, supported by mere
conclusory statements, do not suffice. [Twombly, 550 U.S.] at 555,
127 S. Ct. 1955 (Although for the purposes of a motion to dismiss we
must take all of the factual allegations in the complaint as true, we
“are not bound to accept as true a legal conclusion couched as a
factual allegation” (internal quotation marks omitted)). Rule 8 marks
a notable and generous departure from the hyper-technical,
code-pleading regime of a prior era, but it does not unlock the doors
of discovery for a plaintiff armed with nothing more than
conclusions. Second, only a complaint that states a plausible claim
for relief survives a motion to dismiss. Id., at 556, 127 S. Ct. 1955.
Determining whether a complaint states a plausible claim for relief
will, as the Court of Appeals observed, be a context-specific task that
requires the reviewing court to draw on its judicial experience and
common sense. 490 F.3d, at 157–158. But where the well-pleaded
facts do not permit the court to infer more than the mere possibility
of misconduct, the complaint has alleged—but it has not
9

“show[n]”—“that the pleader is entitled to relief.” FED. RULE CIV.
PROC. 8(a)(2).
Id. at 1949–50 (second alteration in original).
The Iqbal Court set out a two-step procedure for evaluating whether a complaint should be
dismissed:
[A] court considering a motion to dismiss can choose to begin by
identifying pleadings that, because they are no more than
conclusions, are not entitled to the assumption of truth. While legal
conclusions can provide the framework of a complaint, they must be
supported by factual allegations. When there are well-pleaded factual
allegations, a court should assume their veracity and then determine
whether they plausibly give rise to an entitlement to relief.
Id. at 1950.
In analyzing the complaint in Iqbal, the Court noted that it alleged that Ashcroft and Mueller
“‘knew of, condoned, and willfully and maliciously agreed to subject [the plaintiff]’ to harsh
conditions of confinement ‘as a matter of policy, solely on account of [his] religion, race, and/or
national origin and for no legitimate penological interest’”; that Ashcroft “was the ‘principal
architect’ of this invidious policy”; and that Mueller “was ‘instrumental’ in adopting and executing
it.” Id. at 1951 (citations omitted). The Court found these allegations to be conclusory, that they
“amount[ed] to nothing more than a ‘formulaic recitation of the elements’ of a constitutional
discrimination claim,” and that they were not entitled to a presumption of veracity. Id. (citations
omitted).
Turning to the factual allegations in the complaint, the Iqbal Court noted that the complaint
alleged that the FBI, under Mueller’s direction, arrested and detained thousands of Arab Muslim
men as part of its investigation of the September 11 attacks, and that the policy of holding detainees
in highly restrictive conditions until cleared by the FBI was approved by Ashcroft and Mueller. Id.
10

The Court concluded that while these allegations were consistent with Ashcroft and Mueller
designating detainees of “high interest” because of their race, religion, or national original, there
were more likely explanations that prevented the allegations from plausibly establishing a claim.
See id. Because the September 11 attacks were perpetrated by Arab Muslim hijackers claiming to
be members of Al Qaeda, an Islamic fundamentalist group, the Court found that “[i]t should come
as no surprise that a legitimate policy directing law enforcement to arrest and detain individuals
because of their suspected link to the attacks would produce a disparate, incidental impact on Arab
Muslims, even though the purpose of the policy was to target neither Arabs nor Muslims.” Id. The
Court also noted that while there were additional allegations against other defendants, the only
factual allegation against the appellants was that they “adopt[ed] a policy approving ‘restrictive
conditions of confinement’ for post-September-11 detainees until they were ‘‘cleared’ by the FBI.’”
Iqbal, 129 S. Ct. at 1952. The Court said this was not enough:
Accepting the truth of that allegation, the complaint does not show,
or even intimate, that petitioners purposefully housed detainees in the
ADMAX SHU due to their race, religion, or national origin. All it
plausibly suggests is that the Nation’s top law enforcement officers,
in the aftermath of a devastating terrorist attack, sought to keep
suspected terrorists in the most secure conditions available until the
suspects could be cleared of terrorist activity. Respondent does not
argue, nor can he, that such a motive would violate petitioners’
constitutional obligations. He would need to allege more by way of
factual content to “nudg[e]” his claim of purposeful discrimination
“across the line from conceivable to plausible.” Twombly, 550 U.S.,
at 570, 127 S. Ct. 1955.
Id.
The Iqbal Court also rejected the plaintiff’s argument that because the Federal Rules allowed
pleading discriminatory intent “generally,” his complaint was sufficient. Id. at 1954. The Court
explained:
11

It is true that Rule 9(b) requires particularity when pleading “fraud or
mistake,” while allowing “[m]alice, intent, knowledge, and other
conditions of a person’s mind [to] be alleged generally.” But
“generally” is a relative term. In the context of Rule 9, it is to be
compared to the particularity requirement applicable to fraud or
mistake. Rule 9 merely excuses a party from pleading discriminatory
intent under an elevated pleading standard. It does not give him
license to evade the less rigid—though still operative—strictures of
Rule 8. And Rule 8 does not empower respondent to plead the bare
elements of his cause of action, affix the label “general allegation,”
and expect his complaint to survive a motion to dismiss.
Id. (internal citation omitted).
Finally, the Iqbal Court also confirmed that the pleading requirements described in Twombly
are not limited to the antitrust context present in that case. See id. at 1953 (holding that the
argument that “Twombly should be limited to pleadings made in the context of an antitrust dispute
. . . is not supported by Twombly and is incompatible with the Federal Rules of Civil Procedure”).
The Court explained that “[t]hough Twombly determined the sufficiency of a complaint sounding
in antitrust, the decision was based on our interpretation and application of Rule 8,” which “in turn
governs the pleading standard ‘in all civil actions and proceedings in the United States district
courts.’” Id. (citations omitted). The Iqbal Court also confirmed Twombly’s rejection of casemanagement as an appropriate alternative to disposing of implausible claims, particularly in the
context of qualified immunity:
Our rejection of the careful-case-management approach is especially
important in suits where Government-official defendants are entitled
to assert the defense of qualified immunity. The basic thrust of the
qualified-immunity doctrine is to free officials from the concerns of
litigation, including “avoidance of disruptive discovery.” There are
serious and legitimate reasons for this. If a Government official is to
devote time to his or her duties, and to the formulation of sound and
responsible policies, it is counterproductive to require the substantial
diversion that is attendant to participating in litigation and making
informed decisions as to how it should proceed. Litigation, though
necessary to ensure that officials comply with the law, exacts heavy
12

costs in terms of efficiency and expenditure of valuable time and
resources that might otherwise be directed to the proper execution of
the work of the Government. The costs of diversion are only
magnified when Government officials are charged with responding
to, as Judge Cabranes aptly put it, “a national and international
security emergency unprecedented in the history of the American
Republic.” 490 F.3d[] at 179.
Iqbal, 129 S. Ct. at 1953 (internal citations omitted).3
Shortly after Iqbal was decided, the Senate introduced S. 1504, The Notice Pleading
Restoration Act of 2009, which provides that a federal court cannot dismiss a complaint under
Federal Rule of Civil Procedure 12(b)(6) or (e), except under the standards set forth in Conley v.
Gibson, 355 U.S. 41 (1957). The House has introduced H.R. 4115, The Open Access to Courts Act
of 2009, which provides: “A court shall not dismiss a complaint under subdivision (b)(6), (c) or (e)
of Rule 12 of the Federal Rules of Civil Procedure unless it appears beyond doubt that the plaintiff
can prove no set of facts in support of the claim which would entitle the plaintiff to relief. A court
shall not dismiss a complaint under one of those subdivisions on the basis of a determination by the
judge that the factual contents of the complaint do not show the plaintiff’s claim to be plausible or
are insufficient to warrant a reasonable inference that the defendant is liable for the misconduct

3

The Supreme Court found that Iqbal’s complaint “fail[ed] to plead sufficient facts to state a claim for purposeful and
unlawful discrimination against petitioners,” and remanded to allow the “Court of Appeals [to] decide in the first instance
whether to remand to the District Court so that respondent can seek leave to amend his deficient complaint.” Iqbal, 129
S. Ct. at 1954. On remand, the Second Circuit noted that it was “accustomed to reviewing a district court’s decision
whether to grant or deny leave to amend, rather than making that decision . . . in the first instance,” and found “no need
to depart from the ordinary course . . . .” Iqbal v. Ashcroft, 574 F.3d 820, 822 (2d Cir. 2009) (per curiam). The Second
Circuit remanded to the district court “for further proceedings in light of the Supreme Court’s decision in Ashcroft v.
Iqbal, 129 S. Ct. 1937.” Id. “‘On September 29, 2009, the remaining parties in Iqbal filed a document in [the Second
Circuit] stipulating that the appeal was to be ‘withdrawn from active consideration before the Court . . . because a
settlement ha[d] been reached in principle between Javaid Iqbal and defendant United States.’” Arar v. Ashcroft, 585
F.3d 559, 585 n.8 (2d Cir. 2009) (Sack, J., dissenting) (quoting Iqbal v. Hasty, No. 05-5768-cv (2d Cir. Sept. 30, 2009),
“Stipulation Withdrawing Appeal from Active Consideration” dated September 29, 2009).

13

alleged.”4
CIRCUIT COURT CASE LAW INTERPRETING IQBAL
First Circuit
•
Sanchez v. Pereira-Castillo, --- F.3d ----, 2009 WL 4936397 (1st Cir. Dec. 23, 2009). The
plaintiff alleged that “while a prisoner at a Puerto Rico correctional institution, correctional
officers subjected him to an escalating series of searches of his abdominal cavity that
culminated in a forced exploratory abdominal surgery.” Id. at *1. The plaintiff sued
correctional officers for the Commonwealth of Puerto Rico Administration of Corrections
(“AOC”) and doctors from the Rio Piedras Medical Center (“Rio Piedras”) under section
1983. Id. The complaint alleged violations of the plaintiff’s constitutional rights and
supplemental claims under Puerto Rico law. Id. The district court dismissed the complaint
for failure to state a claim. The First Circuit reversed the dismissal of the Fourth
Amendment claims against two of the correctional officers and the doctor who performed
the surgery, reinstated the state law claims, and remanded. Id.
The complaint alleged that after a handheld metal detector gave a positive reading when the
plaintiff was scanned, the plaintiff was subject to increasingly invasive searches. Id. The
plaintiff was allegedly sniffed by law-enforcement dogs, strip-searched, scanned with a
metal detector while naked, subject to abdominal x-rays, placed under constant surveillance,
forced to have bowel movements on the floor in front of correctional officers, subjected to
two rectal examinations and lab tests at Rio Piedras, and eventually subjected to exploratory
abdominal surgery that required the plaintiff to be under total anesthesia and remain in the
hospital for two days of recovery. See Sanchez, 2009 WL 4936397, at *1–3. According to
the complaint, none of the search methods employed after the original metal detector test
revealed any evidence of contraband except that one doctor concluded that the x-rays
revealed a foreign object in the plaintiff’s rectum consistent with a cellular telephone. See
id. Defendant Sergeant Cabán-Rosados (“Cabán”) allegedly conducted the original search
of the plaintiff’s living quarters; asked an unknown doctor, labeled in the complaint as Dr.
Richard Roe I, to order the x-rays; refused to produce a judicial order regarding the x-rays
at the plaintiff’s request; ordered the plaintiff to have bowel movements on the floor; ordered
the plaintiff to be taken to the medical area at the prison; and coordinated the plaintiff’s
transport to Rio Piedras for a rectal examination and/or a medical procedure to remove a
foreign object. Id. at *1–2. Dr. Richard Roe I was alleged to have taken the x-ray ordered
by Cabán; Dr. Richard Roe II was alleged to have examined the x-ray results and determined
that a foreign object was present in the plaintiff’s rectum and to have issued a referral to the
emergency room at Rio Piedras for further testing or intervention, despite the fact that a
second bowel movement showed no foreign objects and over the plaintiff’s objection, denial,
4

The Senate bill states that it applies “[e]xcept as otherwise expressly provided by an Act of Congress or by an
amendment to the Federal Rules of Civil Procedure which takes effect after the date of enactment of this Act.” The
House bill states that it applies “except as otherwise expressly provided by an Act of Congress enacted after the date of
the enactment of this section or by amendments made after such date to the Federal Rules of Civil Procedure pursuant
to the procedures prescribed by the Judicial Conference under this chapter.”

14

and request for an additional x-ray; John Doe was a correctional officer alleged to have
escorted the plaintiff to the hospital and to have insisted on rectal examinations and the
surgery; Dr. Richard Roe III was alleged to be a doctor at Rio Piedras who conducted the
rectal examinations and ordered the lab tests; Dr. Richard Roe IV was alleged to be a
superior of Dr. Richard Roe III who participated in the second rectal examination and who,
together with Dr. Richard Roe III, requested a surgical consultation; Dr. Sandra Deniz was
the surgeon who evaluated the plaintiff and conducted the exploratory surgery after she was
made aware of the negative findings of the two rectal examinations, the normal results of the
lab tests, the absence of foreign objects in the bowel movements, the plaintiff’s denials of
the allegations that he had a cell phone, and the plaintiff’s requests for a second set of x-rays.
Id. The complaint alleged that the plaintiff signed a consent form for the surgery only
because of pressure from John Doe and only after Dr. Deniz agreed to perform another rectal
examination before the surgery, which Dr. Deniz failed to do. Id. at *3. The surgery
revealed no foreign objects, and this finding was confirmed by a subsequent x-ray. Id.
In addition to the Drs. Richard Roe I–IV, John Doe, Cabán, Commander Sanchez (who was
never properly served), and Dr. Deniz, the complaint also named Puerto Rico’s secretary of
corrections and rehabilitation, the security director of the AOC, the director of the eastern
region for the AOC, the security director of the eastern region of the AOC, and the
superintendent of the prison (collectively, “administrative correctional defendants,” and
together with Cabán and John Doe, the “correctional defendants”). Sanchez, 2009 WL
4936397, at *3. The administrative correctional defendants and Cabán moved to dismiss the
complaint for failure to state a claim, asserting that the administrative correctional
defendants should be dismissed because respondeat superior liability was not available under
section 1983 and that the correctional defendants were entitled to qualified immunity. Id.
Dr. Deniz also requested dismissal, alleging that the plaintiff’s medical rights were not
violated by the surgery, that the plaintiff was limited to tort remedies for medical
malpractice, and that she was entitled to Eleventh Amendment immunity in her official
capacity and qualified immunity in her personal capacity. Id. The district court granted the
motions, finding that because the defendants were sued in their personal capacity, sovereign
immunity did not apply; the strip searches, x-rays, and rectal examinations were reasonable
and did not violate the Fourth Amendment; the Fifth Amendment claim could not survive
because that amendment applies only to actions of the federal government; the complaint did
not state a claim against the correctional defendants with respect to the surgery because the
decision regarding the surgery was made by Dr. Deniz; and that the claim against Dr. Deniz
failed because she was not a state actor, but was instead acting as a doctor. Id. at *4 & n.3.
The district court denied the plaintiff’s requests for reconsideration and for leave to file an
amended complaint. Id.
On appeal, with respect to the Fourth Amendment claim, the court found it “impossible to
reconcile the allegations in the complaint with the district court’s conclusion that these
procedures were ‘medical decisions made exclusively by physicians’” because “[a]ccording
to the complaint, the procedures were carried out at the insistence of correctional officials
for the purpose of finding a cell phone in plaintiff’s rectum.” Id. at *6. The court affirmed
dismissal of the claims based on the strip searches and x-rays because the plaintiff did not
15

pursue them on appeal, as well as the dismissal of Drs. Roe I and II because the complaint
had no allegations that those doctors were involved in the rectal examinations or the surgery.
Id. at *6 n.4. The court explained that the complaint adequately alleged that the rectal
examinations and the surgery were searches within the scope of the Fourth Amendment:
The procedures were the direct culmination of a series of
searches that began when a metal detector used to scan plaintiff’s
person gave a positive reading. The complaint describes the surgery
as “medically unnecessary,” and explains circumstances supporting
that claim, namely that plaintiff had two normal bowel movements
before the searches were conducted, that Dr. Roe III examined him
upon arrival at the hospital and found him to be asymptomatic, and
that several lab tests ordered by Dr. Roe III were found to be “within
normal limits.” Because the procedures described in the complaint
were searches for evidence, they are properly analyzed under the
framework of the Fourth Amendment.
Sanchez, 2009 WL 4936397, at *6. The court found that the rectal examinations were not
unreasonable under the Fourth Amendment because “[t]he complaint describe[d] no abusive
or otherwise unprofessional conduct on the part of the correctional officers or the doctors
during the rectal exams” and did not “set forth any facts to suggest that the rectal
examinations of plaintiff’s person by medical professionals were more intrusive than similar
exams carried out as a matter of policy by paraprofessionals at other prisons,” and because
the plaintiff did “not argue that the digital rectal searches were not related to a legitimate
penological need” or “describe any circumstances surrounding the examinations that would
[have] ma[de] the searches appear abusive.” Id. at *8. The court concluded that “the rectal
searches of plaintiff described in the complaint, carried out by medical professionals in the
relatively private, sanitary environment of a hospital, upon suspicion that plaintiff had
contraband in his rectum, and with no abusive or humiliating conduct on the part of the law
enforcement officers or the doctors, were not unreasonable.” Id. (footnote omitted). As a
result, the court affirmed the dismissal of Drs. Roe III and IV because, “according to the
complaint, they did not encourage or participate in the surgery.” Id. at *8 n.6.
The court determined that the complaint adequately alleged an unreasonable search with
respect to the surgery, noting that the complaint stated that the plaintiff “was forced to
undergo dangerous, painful, and extremely intrusive abdominal surgery for the purpose of
finding a contraband telephone allegedly concealed in his intestines, even though the basis
for believing there was a telephone was slight, several tests had indicated the absence of any
such object, and additional, far less intrusive testing could easily have obviated any need for
such grievous intrusion.” Id. at *9. The court disagreed with the district court’s conclusion
that the signed consent for surgery eliminated Fourth Amendment concerns, “reiterat[ing]
that the district court was obligated . . . to accept the well-pleaded facts in the complaint as
true.” Id. at *10. The court concluded:
Plaintiff was a prisoner who had been under constant
16

surveillance for more than a day prior to the surgery, and had been
forced to submit to searches, x-rays, and invasive rectal examinations
prior to his signing the consent form. He had twice been forced to
excrete on a floor in the presence of prison personnel. In light of
these intimidating circumstances, plaintiff’s claim that he was
pressured and intimidated into signing the consent form is plausible.
Sanchez, 2009 WL 4936397, at *10. In addition, the court noted that according to the
complaint, the plaintiff gave consent to the surgery only if Dr. Deniz would first conduct
another rectal examination, which she did not do. Id. The court stated that “[v]iewing the
plaintiff’s well-pleaded factual allegations as true, [it] conclude[d] that ‘society is prepared
to recognize’ that a prisoner has a reasonable expectation that he will not be forced to
undergo abdominal surgery for the purpose of finding contraband, at least in these
circumstances.” Id. at *12. The court noted that the plaintiff “was surgically invaded for
the purpose of searching for a cell phone when other, less-invasive means had already
indicated the absence of such an object,” “there [wa]s serious doubt whether the surgery was
even ‘likely to produce evidence of a crime,’ and by far less drastic measures[,] the existence
of the telephone could easily have been excluded.” Id. (internal citation omitted). The court
held that “the allegations in the complaint describe[d] an unreasonable search conducted
under the color of state law.” Id. (footnote omitted).
Having found that the plaintiff had “alleged facts which, if proved, would amount to a
violation of his Fourth Amendment rights,” the court turned to “the sufficiency of his claims
that the various defendants in this action caused that violation.” Id. After emphasizing that
the evaluation of a complaint is a context-specific task, the court concluded the claims
against Cabán, John Doe, and Dr. Deniz had “‘facial plausibility,’” but that the claims
against the administrative correctional defendants did not. Sanchez, 2009 WL 4936397, at
*12 (citing Iqbal, 129 S. Ct. at 1949). The court noted that under Iqbal, it could “‘begin by
identifying pleadings that, because they are no more than conclusions, are not entitled to an
assumption of truth.’” Id. at *13 (quoting Iqbal, 129 S. Ct. at 1950). The court stated:
Turning to plaintiff’s complaint, we find that it does little more than
assert a legal conclusion about the involvement of the administrative
correctional defendants in the underlying constitutional violation.
Parroting our standard for supervisory liability in the context of
Section 1983, the complaint alleges that the administrative
defendants were “responsible for ensuring that the correctional
officers under their command followed practices and procedures
[that] would respect the rights and ensure the bodily integrity of
Plaintiff” and that “they failed to do [so] with deliberate indifference
and/or reckless disregard of Plaintiff’s federally protected rights.”
This is precisely the type of “the-defendant-unlawfully-harmed-me”
allegation that the Supreme Court has determined should not be given
credence when standing alone.
17

Id. (citing Iqbal, 129 S. Ct. at 1949) (alterations in original). The court continued:
The sole additional reference to the administrative
correctional defendants’ role in the surgery is the complaint’s
statement that “[t]he pushiness exerted by John Doe [upon the
doctors] followed . . . the regulations and directives designed by
[Puerto Rico’s Secretary of Corrections and Rehabilitation] Pereira
and construed and implemented by all of the other Supervisory
Defendants.” However, the only regulations described in the
complaint are the strip search and x-ray regulations promulgated by
Pereira. The deliberate indifference required to establish a
supervisory liability/failure to train claim cannot plausibly be inferred
from the mere existence of a poorly-implemented strip search or
x-ray policy and a bald assertion that the surgery somehow resulted
from those policies. We conclude, therefore, that the “complaint has
alleged—but it has not ‘show[n]’—‘that the pleader is entitled to
relief’” from the administrative correctional defendants. Iqbal, 129
S. Ct. at 1950 (quoting FED. RULE CIV. PROC. 8(a)(2)). Although it
did so on different grounds, the district court was correct to dismiss
the claims against those defendants.
Id. (first, second, and fourth alterations in original) (footnote omitted). The court noted that
“[t]he complaint contain[ed] more specific factual allegations about the administrative
correctional defendant[s’] supervisory responsibility for the strip and x-ray searches,” but
that “[b]ecause [the court] f[ound] there to be no underlying constitutional violation arising
from the strip and x-ray searches of plaintiff, the claims for supervisory liability arising from
those searches must fail.” Id. at *13 n.9.
However, with respect to Cabán and John Doe, the court found the plaintiff’s allegations
“sufficient to allow [it] ‘to draw the reasonable inference that [each] defendant [wa]s liable
for the misconduct alleged.’” Id. at *14 (quoting Iqbal, 129 S. Ct. at 1949) (second
alteration in original). The court explained:
Although the claims against John Doe and Cabán also rest on a form
of supervisory liability in the sense that neither one actually
performed the surgery on plaintiff, those claims do not depend on a
showing by plaintiff of a failure to train amounting to deliberate
indifference to his constitutional rights. Instead, plaintiff succeeds in
pleading that the defendants were liable as “primary violator[s] . . .
in the rights-violating incident,” thereby stating a sufficient claim for
relief.
Sanchez, 2009 WL 4936397, at *14 (citation omitted). The court found the claims against
Cabán plausible:
18

Plaintiff’s complaint specifically alleges that Cabán was directly
involved in all phases of the search for contraband, and in the
ultimate decision to transport plaintiff to the hospital “for a rectal
examination and/or a medical procedure to remove the foreign object
purportedly lodged in Plaintiff’s rectum.” The complaint goes on to
allege that John Doe, acting pursuant to “orders imparted by Cabán,”
pressured the doctors to conduct a medical procedure to remove the
illusory cell phone from plaintiff’s bowels. Given these allegations,
it is a plausible inference that Cabán caused plaintiff to be subjected
to the deprivation of his Fourth Amendment rights. See 42 U.S.C. §
1983.
Id. at *14 (footnote omitted). Because “an actor is ‘responsible for ‘those consequences
attributable to reasonably foreseeable intervening forces, including the acts of third
parties,’’” and because the court “read the plaintiff’s complaint to state that Cabán
affirmatively set in motion the trip to the hospital for the purpose of removing the alleged
contraband from within plaintiff’s body, with a resort by medical professionals to whatever
procedure was required to achieve that goal,” the plaintiff had adequately stated a claim
against Cabán. Id. (citations omitted). With respect to John Doe, the court held:
The complaint alleges that plaintiff arrived at the hospital emergency
room “accompanied by John Doe.” The complaint further states that
“[a]t all times John Doe insisted that plaintiff was hiding a cellular
phone in his rectum and pressured the medical personnel at the
emergency room . . . to conduct a medical procedure to remove it.”
Thus, the complaint charges John Doe with affirmatively causing the
violation of plaintiff’s rights by insisting at the hospital that the
doctors perform a medical procedure to remove the suspected
contraband from his stomach. Like Cabán, he is alleged to be a
primary violator of plaintiff’s Fourth Amendment rights.
Id. (alteration in original).
The court next considered whether the plaintiff had adequately pleaded state action with
respect to Dr. Deniz. (It was undisputed that the correctional defendants were state actors.
Id. at *15 n.12.) The plaintiff argued that Dr. Deniz was a state actor under the state
compulsion test, which provides that a party is a state actor “‘when the state ‘has exercised
coercive power or has provided such significant encouragement, either overt or covert, that
the [challenged conduct] must in law be deemed to be that of the State.’’” Id. at *15
(citation omitted). The court concluded that the complaint, “which describe[d] ‘the
insistence and pressure exerted by John Doe upon all of the physicians that examined him
at the Rio Piedras Medical Center,’ sufficiently allege[d] facts that m[et] the state
compulsion test.” Sanchez, 2009 WL 4936397, at *15.
The court concluded that Cabán and John Doe were not entitled to qualified immunity
19

because “the surgery described in the complaint and its attendant circumstances were so
outrageous, [the court] could comfortably conclude that a reasonable officer would
understand that, under the particular facts of this case, the surgery violated plaintiff’s clearly
established right to be free from an unreasonable search.” Id. at *16 (citation omitted). The
court determined that Dr. Deniz also was not entitled to qualified immunity, explaining that
“a reasonable doctor should have understood that the surgery at issue here, performed at the
insistence of the correctional authorities and not for plaintiff’s benefit, violated plaintiff’s
Fourth Amendment right to be free of unreasonable searches and seizures.” Id. at *18.
Finally, because the court found that some of the federal claims should not have been
dismissed, it reinstated the supplemental state law claims and remanded. Id.
•

Maldonado v. Fontanes, 568 F.3d 263 (1st Cir. 2009). Residents of public housing
complexes brought a civil rights suit under § 1983 against the mayor of Barceloneta, Puerto
Rico, alleging that their rights had been violated by the seizures and cruel killings of their
pet cats and dogs. Id. at 266. The pets were taken in two separate raids after the
Municipality of Barceloneta assumed control of the public housing complexes. Id. Prior to
that transfer, the plaintiffs had been allowed to keep pets in the housing complexes. Id. A
few days before the raids, the residents were told to surrender their pets or face eviction. Id.
The plaintiffs alleged that after their pets were seized, the pets were violently killed. Id. The
mayor, in his personal capacity, moved to dismiss all damages claims against him on the
ground of qualified immunity. Maldonado, 468 F.3d at 266. The district court denied the
motion to dismiss, and the mayor took an interlocutory appeal. Id. The First Circuit
affirmed the denial of the motion for qualified immunity on the Fourth Amendment and
Fourteenth Amendment procedural due process claims, but applied Iqbal to reverse the
denial of qualified immunity to the mayor as to the Fourteenth Amendment substantive due
process claims. Id. The mayor also moved to dismiss for failure to state a claim, and the
district court granted the motion as to some claims and denied it as to the Fourth and
Fourteenth Amendment claims and pendent state law claims, but that order was not
appealable. Id. at 267 n.1.
With respect to the substantive due process claim, the First Circuit stated: “[A]nalyzing the
pleadings under Iqbal, we hold that the allegations of the complaint do not allege a sufficient
connection between the Mayor and the alleged conscience-shocking behavior—the killing
of the seized pets—to state the elements of a substantive due process violation.” Id. at 273.
Specifically, the court noted that the mayor’s alleged liability did not involve a policy of the
municipality and was not based on the mayor’s personal conduct, but instead was based on
the allegation that the mayor promulgated a pet policy for the public housing complexes and
was present at and participated in one of the raids. Id. The court concluded that this was
insufficient to find the mayor liable because there was nothing conscience-shocking about
the pet policy itself, which did not address how prohibited pets were to be removed, and
because the complaint alleged no policy authorizing the killing of the pets and no such
policy authorized by the mayor. Id. The court noted that the complaint alleged an informal
policy from the repeating of the raids, but held that a single repetition was not sufficient to
show the mayor’s endorsement of an informal policy, stating that it would “reject such
‘‘naked assertion[s]’ devoid of ‘further factual enhancement.’’” Maldonado, 568 F.3d at 273
20

n.6 (quoting Iqbal, 129 S. Ct. at 1950 (quoting Twombly, 550 U.S. at 557)).
The court also concluded that there was no allegation that the mayor was personally involved
in any of the conscience-shocking behavior. Id. at 274. The court noted that while the
complaint alleged that the mayor was present at the first raid and observed it, he was “not
named as the individual who directly planned, supervised, and executed the raids,” and there
was no allegation that he participating in the killings or directed the private contractor who
captured the pets. Id. Instead, the complaint only alleged that “he supervised, directly or
indirectly, the agencies involved.” Id. The court noted the “generalized” allegation that the
mayor “planned, personally participated in, and executed the raids in concert with others,”
but stated that “the others are named as the persons with specific administrative
responsibilities as to the public housing complexes.” Id. The court concluded that “‘[t]hese
bare assertions, much like the pleading of conspiracy in Twombly, amount[ed] to nothing
more than a ‘formulaic recitation of the elements’ of a constitutional [tort],’ Iqbal, at 1951
(quoting Twombly, 550 U.S. at 55, 127 S. Ct. 1955), and [we]re insufficient to push the
plaintiffs’ claim beyond the pleadings stage.” Id. (second alteration in original). The court
continued: “[T]he complaint alleges, without any more details, that the Mayor was among
all the other public and private employees ‘snatching pets from owners.’ Although these
bare allegations may be ‘consistent with’ a finding of liability against the Mayor for seizure
of the same pets, such allegations ‘stop[ ] short of the line between possibility and
plausibility of ‘entitlement to relief’ on the larger substantive due process claim.”
Maldonado, 568 F.3d at 274 (quoting Iqbal, 129 S. Ct. at 1960 (quoting Twombly, 550 U.S.
at 557) (internal quotation marks omitted)) (second alteration in original). The court held
that the allegations against the mayor did not show “that his involvement was sufficiently
direct to hold him liable for violations of the plaintiffs’ substantive due process rights.” Id.
Finally, the court concluded that the allegations did not support a theory of supervisory
liability because “supervisory liability lies only where an ‘‘affirmative link’ between the
behavior of a subordinate and the action or inaction of his supervisor’ exists such that ‘‘the
supervisor’s conduct led inexorably to the constitutional violation,’’” and the allegations did
not support finding such a link. See id. at 274–75 (citations omitted).
The court also concluded that there was no liability under a theory of deliberate indifference
because such liability “‘will be found only if it would be manifest to any reasonable official
that his conduct was very likely to violate an individual’s constitutional rights,’” but “the
Mayor’s promulgation of a pet policy that was silent as to the manner in which the pets were
to be collected and disposed of, coupled with his mere presence at one of the raids, [wa]s
insufficient to create the affirmative link necessary for a finding of supervisory liability, even
under a theory of deliberate indifference.” Id. at 275 (citation omitted). The court concluded
that qualified immunity on the Fourteenth Amendment substantive due process claim was
warranted. Id.

Second Circuit
•
Turkmen v. Ashcroft, --- F.3d ----, 2009 WL 4877787 (2d Cir. Dec. 18, 2009) (per curiam).
21

Seven named plaintiffs, who were non-citizens detained on immigration charges following
September 11, 2001, filed a putative class action alleging “that on account of their Arab or
Muslim background (or perceived background), they were subjected to excessively
prolonged detention, abused physically and verbally, subjected to arbitrary and abusive strip
searches, and otherwise mistreated while in custody.” Id. at *1. The plaintiffs
acknowledged that they were in the country illegally and subject to removal, but asserted
constitutional violations based on the conditions of their confinement and the length of their
detention, which they alleged was “illegally prolonged so that the Government could
investigate any potential ties to terrorism.” Id. Among the 31 identified defendants were
the United States, former Attorney General John Ashcroft, FBI Director Robert Mueller,
former Immigration and Naturalization Service Commissioner James Ziglar, and officials
and corrections officers from the Metropolitan Detention Center. Id. “The United States,
Ashcroft, Mueller, and Ziglar, as well as four high-ranking MDC officials . . . moved to
dismiss certain claims on grounds that include[d] qualified immunity and failure to state a
claim.” Id. (footnote omitted). The district court denied the motions with respect to the
conditions of confinement, but granted dismissal with respect to the length of detention. Id.
Both sides appealed.
In considering the defendants’ challenge to the denial of dismissal for the claims based on
conditions of confinement, the court noted:
The district court ruled on the defendants’ motions to dismiss
prior to the Supreme Court’s decisions in Twombly and Iqbal. It
applied a standard of review under which it would not dismiss a
claim “unless it appears beyond doubt . . . that the plaintiff can prove
no set of facts which would entitle him to relief.” Now, following the
district court’s decision, Twombly and Iqbal require “a heightened
pleading standard in those contexts where factual amplification is
needed to render a claim plausible.” Ross v. Bank of America, N.A.
(USA), 524 F.3d 217, 225 (2d Cir. 2008) (internal quotation marks,
citations, brackets, and emphasis omitted). We could undertake to
decide whether the challenged claims satisfy the pleading standard of
Twombly and Iqbal; however, in the circumstances of this
case—where plaintiffs have already announced their intent to file a
Fourth Amended Complaint to preserve for the putative class the
claims asserted only by the settling plaintiffs—we think it better to
vacate that portion of the district court’s order denying dismissal of
the conditions of confinement claims on the ground that an outdated
pleading standard was applied, and to remand the case for further
proceedings consistent with the standard articulated in Twombly and
Iqbal.
Turkmen, 2009 WL 4877787, at *2 (internal citation omitted). The court stated that the
district court might, on remand, “grant plaintiffs leave to file the proposed Fourth Amended
22

Complaint to satisfy the heightened pleading standard,” but “decline[d] to consider whether
plaintiffs should be allowed to replead yet again because ‘[i]n the ordinary course, [the court
was] accustomed to reviewing a district court’s decision whether to grant or deny leave to
amend, rather than making that decision for [itself] in the first instance.’” Id. at *3 (quoting
Iqbal v. Ashcroft, 574 F.3d 820, 822 (2d Cir. 2009)). The court directed:
If the district court denies leave to file the proposed Fourth
Amended Complaint, it should evaluate the sufficiency of the Third
Amended Complaint in light of the settlement and the heightened
pleading standard. The district court can then address whether, under
Twombly and Iqbal, the Third Amended Complaint fails to state a
claim, or inadequately alleges the personal involvement of the
moving defendants, or entitles the moving defendants to qualified
immunity with respect to the conditions of confinement claims.
Id. The court emphasized that “[a]t this stage of proceedings, [the court] d[id] no more than
vacate the order denying the motions to dismiss with respect to the conditions of
confinement claims, and remand to the district court for further proceedings.” Id.
With respect to the dismissed claims based on the length of detention, the court noted that
these claims “allege[d] generally that defendants detained plaintiffs longer than necessary
to effect their removal (or voluntary departure) from the United States.” Id. The complaint
alleged that the defendants used the plaintiffs’ acknowledged “immigration violations ‘as
a cover, as an excuse’ to investigate whether plaintiffs were tied to terrorism.” Id. The
complaint alleged that the detentions constituted a seizure under the Fourth Amendment, a
violation of the Due Process Clause of the Fifth Amendment, and a violation of the equal
protection right encompassed in the Fifth Amendment. Turkmen, 2009 WL 4877787, at *3
& n.4. By statute, aliens ordered removed are to be removed by the Attorney General within
a 90-day “removal period,” and “[t]he government is required to detain an alien ordered
removed until removal is effected, at least for the removal period.” Id. at *3. Relevant
regulations provide that a review is conducted of the alien’s record to determine whether
detention is appropriate after the removal period, if removal cannot be completed during that
period. Id. The Second Circuit noted that in Zadvydas v. Davis, 533 U.S. 678 (2001), the
Supreme Court “accorded a presumption of reasonableness to six months’ detention for an
alien subject to an order of removal,” and that “thereafter, the alien’s continued detention
would be deemed unlawful ‘if (1) an alien demonstrate[d] that there [wa]s no significant
likelihood of removal in the reasonably foreseeable future and (2) the government [wa]s
unable to rebut this showing.’” Turkmen, 2009 WL 4877787, at *4 (quoting Wang v.
Ashcroft, 320 F.3d 130, 146 (2d Cir. 2003)) (footnote omitted). The court noted that
“Turkmen, Sachdeva, and two of the settling plaintiffs were detained for less than six
months,” and that their detentions “thus were presumptively reasonable.” Id. at *4 & n.5.
The court explained the district court’s analysis:
The district court, relying on Zadvydas and Wang, concluded
23

that plaintiffs failed to state a claim because “the complaint does not
allege that during the period of their detention there was no
significant likelihood of removal in the reasonably foreseeable
future.” The complaint alleged simply that the detentions were
“longer than necessary” to effectuate removal. As the district court
reasoned, recognizing such a claim as a violation of due process
would “flood the courts with habeas petitions brought by aliens
seeking to be removed as soon as they deemed it practicable.” The
district court explained that:
[Plaintiffs] assume that all that is required for the
Attorney General to secure removal is a deportation
order and an airplane. This assumption ignores
legitimate foreign policy considerations and
significant administrative burdens involved in
enforcing immigration law in general, and,
specifically, those concerns immediately following a
terrorist attack perpetrated on the United States by
non-citizens, some of whom had violated the terms of
their visas at the time of the attack.
Id. at *4 (internal citations omitted) (alteration in original). On appeal, the plaintiffs
“argue[d] that they were detained for a criminal investigation, and their detentions thus
constituted separate seizures requiring their own justification and probable cause.” Id. at *5.
The plaintiffs “assert[ed] that the Zadvydas standard identifies constitutional violations only
‘when removal is impossible’; they submit[ted] that it is inadequate to identify constitutional
violations where, as alleged here, defendants employ[ed] ‘detention as an alternative to
removal.’” Id. (citation omitted). The Second Circuit disagreed:
In Whren v. United States, 517 U.S. 806, 813, 116 S. Ct. 1769, 135
L. Ed. 2d 89 (1996), the Supreme Court held that a law enforcement
official’s actual motivation for the Fourth Amendment seizure of a
person is constitutionally irrelevant if the seizure is supported by
probable cause. To the extent plaintiffs challenge their prolonged
detention after final orders of removal (or voluntary departure) were
entered against them, it is clear from the complaint that such
detention was supported by the IJs’ findings of removability, which
constitute a good deal more than probable cause. Because plaintiffs
were thus lawfully detained as aliens subject to orders of removal (or
voluntary departure), they could not state a claim for
unconstitutionally prolonged detention without pleading facts
plausibly showing “no significant likelihood of removal in the
reasonably foreseeable future.” Wang, 320 F.3d at 146; see also
Zadvydas, 533 U.S. at 699. In the absence of such a pleading,
24

plaintiffs’ challenge to their detention was properly dismissed under
Federal Rule of Civil Procedure 12(b)(6). Moreover, we need not
decide whether or under what circumstances aliens subject to
removal (or voluntary departure) orders could state claims for
unconstitutional detentions without satisfying Zadvydas. To the
extent plaintiffs’ claims are not based on Zadvydas, the moving
defendants are entitled to qualified immunity.
Id. The court continued:
In light of the analysis above, plaintiffs can point to no
authority clearly establishing a due process right to immediate or
prompt removal (following an order of removal or voluntary
departure). The moving defendants therefore are entitled to qualified
immunity with respect to claim 2.
Assuming arguendo that the Fourth Amendment applies to
post-arrest detention, probable cause would be required only if the
detentions at issue were not otherwise authorized. For reasons stated
above, the moving defendants had an objectively reasonable belief
that the detentions were authorized, and therefore are entitled to
qualified immunity with respect to claim 1.
Similarly, plaintiffs point to no authority clearly establishing
an equal protection right to be free of selective enforcement of the
immigration laws based on national origin, race, or religion at the
time of plaintiffs’ detentions. The moving defendants therefore are
entitled to qualified immunity with respect to claim 5 (to the extent
that claim 5 is based on the length of plaintiffs’ detentions).
Turkmen, 2009 WL 4877787, at *5–6 (internal citations omitted).
•

Arar v. Ashcroft, 585 F.3d 559 (2d Cir. 2009) (en banc). The plaintiff filed suit against the
Attorney General of the United States, the Secretary of Homeland Security, the Director of
the FBI, and others, including senior immigration officials, after he was allegedly detained
while changing planes in New York. Id. at 563. Arar alleged that he was mistreated for 12
days while in U.S. custody, then removed to Syria via Jordan with the understanding that he
would be detained, interrogated, and tortured in Syria. Id. The complaint alleged violations
of the Torture Victims Protection Act (“TVPA”) and of his Fifth Amendment substantive
due process rights based on the conditions of his detention in the United States, the denial
of access to counsel and the courts in the United States, and his detention and torture in
Syria. Id. The district court dismissed the complaint, and on appeal, the Second Circuit
panel unanimously found that the district court had jurisdiction over the Attorney General,
the former Acting Attorney General, and the Director of the FBI; that Arar failed to state a
25

claim under the TVPA; and that Arar failed to establish subject matter jurisdiction over his
request for a declaratory judgment. Id. A majority of the panel dismissed Arar’s Bivens
claims. Id. On rehearing en banc, the Second Circuit affirmed the district court’s holding.
Arar, 585 F.3d at 563.
On rehearing, the majority stated:
We have no trouble affirming the district court’s conclusions
that Arar sufficiently alleged personal jurisdiction over the
defendants who challenged it, and that Arar lacks standing to seek
declaratory relief. We do not reach issues of qualified immunity or
the state secrets privilege. As to the TVPA, we agree with the
unanimous position of the panel that Arar insufficiently pleaded that
the alleged conduct of United States officials was done under color
of foreign law. We agree with the district court that Arar
insufficiently pleaded his claim regarding detention in the United
States, a ruling that has been reinforced by the subsequent authority
of Bell Atlantic Corp. v. Twombly,5 550 U.S. 544, 570, 127 S. Ct.
1955, 167 L. Ed. 2d 929 (2007). Our attention is therefore focused
on whether Arar’s claims for detention and torture in Syria can be
asserted under Bivens . . . .
Id. (emphasis added).
Arar alleged that he was a dual citizen of Canada and Syria, and resided in Canada. Id. at
565. While on vacation in Tunisia, he was called back to work in Canada and had to change
planes in New York. Id. During his stop in New York, Arar was detained by immigration
officials and transferred the next day to a detention center in Brooklyn, where he was kept
for a week and a half. Id. The INS began removal proceedings based on its conclusion that
Arar belonged to a terrorist organization. Id. Despite Arar’s request for removal to Canada,
the INS ordered his removal to Syria, found that removal would be consistent with Article
3 of the Convention Against Torture (“CAT”), and barred Arar from reentering the United
States for five years. Arar, 585 F.3d at 566. The INS Regional Director determined that
Arar was a member of Al Qaeda and inadmissible in the United States, and the Deputy
Attorney General stated that the removal to Syria would be consistent with the CAT, despite
the fact that Arar stated that he feared torture in Syria. Id. According to the complaint, Arar
was transferred to Jordan and then to Syria, where he remained for a year and where he was
tortured. See id. “Arar allege[d] that United States officials conspired to send him to Syria
for the purpose of interrogation under torture, and directed the interrogations from abroad
by providing Syria with Arar’s dossier, dictating questions for the Syrians to ask him, and

5

The Second Circuit’s note that Twombly was decided after the district court’s decision in Arar shows that the district
court found the allegations regarding the detention in the United States insufficient even under pre-Twombly standards,
and that the Second Circuit majority agreed under post-Twombly standards.

26

receiving intelligence learned from the interviews.” Id. Arar eventually signed a confession
stating that he had been trained as a terrorist in Afghanistan. Id. Arar was later released to
the custody of a Canadian embassy official. Id. at 566–67.
Arar’s complaint contained four counts against federal officials and sought damages
resulting from Arar’s detention and torture. Arar, 585 F.3d at 567. The counts included
claims for: (1) relief under the TVPA, (2) relief under the Fifth Amendment for torture in
Syria, (3) relief under the Fifth Amendment for detention in Syria, and (4) relief under the
Fifth Amendment for the detention in the United States prior to the removal to Syria. Id.
Arar also sought a declaratory judgment that the defendants violated his “‘constitutional,
civil, and human rights.’” Id.
As to the first count, which alleged that the defendants conspired with Jordanian and Syrian
officials to have Arar tortured in violation of the TVPA, the court noted that “[a]ny
allegation arising under the TVPA requires a demonstration that the defendants acted under
color of foreign law, or under its authority.” Id. at 568 (citation omitted). The court held
that Arar failed to state a claim under the TVPA:
Accordingly, to state a claim under the TVPA, Arar must
adequately allege that the defendants possessed power under Syrian
law, and that the offending actions (i.e., Arar’s removal to Syria and
subsequent torture) derived from an exercise of that power, or that
defendants could not have undertaken their culpable actions absent
such power. The complaint contains no such allegation. Arar has
argued that his allegation of conspiracy cures any deficiency under
the TVPA. But the conspiracy allegation is that United States
officials encouraged and facilitated the exercise of power by Syrians
in Syria, not that the United States officials had or exercised power
or authority under Syrian law. The defendants are alleged to have
acted under color of federal, not Syrian, law, and to have acted in
accordance with alleged federal policies and in pursuit of the aims of
the federal government in the international context. At most, it is
alleged that the defendants encouraged or solicited certain conduct
by foreign officials. Such conduct is insufficient to establish that the
defendants were in some way clothed with the authority of Syrian law
or that their conduct may otherwise be fairly attributable to Syria.
We therefore agree with the unanimous holding of the panel and
affirm the District Court's dismissal of the TVPA claim.6
Id. (internal citation and footnote omitted) (emphasis added).

6

It appears that the court concluded that the conduct alleged was insufficient to state a claim for relief because the
applicable law—the TVPA—provided no grounds for relief where “United States officials encouraged and facilitated
the exercise of power by Syrians in Syria,” not that the facts alleged were insufficiently detailed or implausible.

27

With respect to the fourth count, which alleged that the conditions of confinement in the
United States and the denial of access to courts during the detention violated Arar’s
substantive due process rights, the district court dismissed the claim as insufficiently pleaded
and gave Arar an opportunity to replead, which Arar declined. Id. at 569. The Second
Circuit majority agreed that the claim was insufficiently pleaded:
Arar alleges that “Defendants”—undifferentiated—“denied
Mr. Arar effective access to consular assistance, the courts, his
lawyers, and family members” in order to effectuate his removal to
Syria. But he fails to specify any culpable action taken by any single
defendant, and does not allege the “meeting of the minds” that a
plausible conspiracy claim requires. He alleges (in passive voice)
that his requests to make phone calls “were ignored,” and that “he
was told” that he was not entitled to a lawyer, but he fails to link
these denials to any defendant, named or unnamed. Given this
omission, and in view of Arar’s rejection of an opportunity to
re-plead, we agree with the District Court and the panel majority that
this Count of the complaint must be dismissed.
Arar, 585 F.3d at 569 (emphasis added). The court “expressed no view as to the sufficiency
of the pleading otherwise, that is, whether the conduct alleged (if plausibly attributable to
defendants) would violate a constitutionally protected interest.” Id.
Having dismissed the claims based on Arar’s detention in the United States, the court noted
that the “remaining claims s[ought] relief on the basis of torture and detention in Syria . . .
.” Id. The court declined to definitively resolve complex jurisdictional questions because
it determined that the case had to be dismissed for other reasons. See id. at 570–71. The
court framed the remaining issue as “whether allowing this Bivens action to proceed would
extend Bivens to a new ‘context,’ and if so, whether such an extension is advisable.” Id. at
572. As to context, the court concluded that “the context of extraordinary rendition in Arar’s
case is the complicity or cooperation of United States government officials in the delivery
of a non-citizen to a foreign country for torture (or with the expectation that torture will take
place),” and concluded that this was a “new context” because “no court ha[d] previously
afforded a Bivens remedy for extraordinary rendition.” Id. The court concluded that
“special factors” counseled against creation of a Bivens remedy in this context. See Arar,
585 F.3d at 573. Specifically, the court found that a Bivens action in the context of
extraordinary rendition “would have the natural tendency to affect diplomacy, foreign policy,
and the security of the nation,” which “counsel[ed] hesitation” in creating a Bivens remedy.
Id. at 574. The court explained that “[a]bsent clear congressional authorization, the judicial
review of extraordinary rendition would offend the separation of powers . . . and inhibit this
country’s foreign policy.” Id. at 576. The court also cited the fact that classified information
was involved, id.; the fact that “reliance on information that cannot be introduced into the
public record is likely to be a common feature of any Bivens actions arising in the context
28

of alleged extraordinary rendition,” in view of the “preference for open rather than
clandestine court proceedings,” id. at 577; the fact that extending Bivens into the
extraordinary rendition context would require assessing assurances made by foreign
countries that the alien would not be tortured, id. at 578; the possibility that Bivens suits
would “make the government ‘vulnerable to ‘graymail,’ i.e., individual lawsuits brought to
induce the [government] to settle a case (or prevent its filing) out of fear that any effort to
litigate the action would reveal classified information that may undermine covert
operations,’ or otherwise compromise foreign policy efforts,” Arar, 585 F.3d at 578–79
(alteration in original) (citation omitted); and its conclusion that “Congress is the appropriate
branch of government to decide under what circumstances (if any) these kinds of policy
decisions—which are directly related to the security of the population and the foreign affairs
of the country—should be subjected to the influence of litigation brought by aliens,” id. at
580–81.
Several dissenting opinions were filed. Judge Sack dissented, joined by Judges Calabresi,
Pooler, and Parker, and disagreed with the majority’s finding that there was no Bivens
remedy, finding that the majority reached its conclusion “by artificially dividing the
complaint into a domestic claim that does not involve torture . . . and a foreign claim that
does . . . .” Id. at 582–83 (Sack, J., dissenting). Judge Sack’s dissent noted that after
dividing the claims, “[t]he majority then dismisse[d] the domestic claim as inadequately
pleaded and the foreign claim as one that cannot ‘be asserted under Bivens’ . . . .” Id. at 583.
Judge Sack argued that even if the claim regarding Arar’s treatment in the United States
were treated separately, “it was adequately pleaded in [Arar’s] highly detailed complaint.”
Id. But Judge Sack asserted that it was improper to consider the claim regarding Arar’s
treatment in the United States in isolation, and that, viewed in the context of the entire
complaint, the allegations did “not present a ‘new context’ for a Bivens action.” Id. Judge
Sack’s dissent also concluded that even if a new context were presented, the majority’s
approach to determining whether to create a Bivens remedy was improper. See Arar, 585
F.3d at 583 (Sack, J., dissenting). Judge Sack noted that Arar declined to replead his fourth
claim because he wanted early appellate review of the dismissal of the first three claims. See
id. at 590 n.13. Judge Sack asserted that “Arar should not have been required to ‘name those
defendants [who] were personally involved in the alleged unconstitutional treatment’”
because under section 1983, courts “allow plaintiffs to ‘maintain[ ] supervisory personnel
as defendants . . . until [they have] been afforded an opportunity through at least brief
discovery to identify the subordinate officials who have personal liability.’” Id. at 591
(alterations in original). Judge Sack’s dissent explained the impact of Iqbal:
To be sure, the Supreme Court has recently set a strict
pleading standard for supervisory liability claims under Bivens
against a former Attorney General of the United States and the
Director of the FBI. See Iqbal, supra. We do not think, however,
that the Court has thereby permitted governmental actors who are
unnamed in a complaint automatically to escape personal civil rights
liability. A plaintiff must, after all, have some way to identify a
29

defendant who anonymously violates his civil rights. We doubt that
Iqbal requires a plaintiff to obtain his abusers’ business cards in order
to state a civil rights claim. Put conversely, we do not think that
Iqbal implies that federal government miscreants may avoid Bivens
liability altogether through the simple expedient of wearing hoods
while inflicting injury. Some manner of proceeding must be made
available for the reasons we recognized in Davis [v. Kelly, 160 F.3d
917, 921 (2d Cir. 1998)].
Id. at 591–92. Judge Sack’s dissent asserted that the complaint’s allegations were sufficient:
Whether or not there is a mechanism available to identify the
“Doe” defendants, moreover, Arar’s complaint does sufficiently
name some individual defendants who personally took part in the
alleged violation of his civil rights. The role of defendant J. Scott
Blackman, formerly Director of the Regional Office of INS, for
example, is, as reflected in the district court’s explication of the facts,
set forth in reasonable detail in the complaint. So are at least some
of the acts of the defendant Edward J. McElroy, District Director of
the INS.
Id. at 592 (internal citation and footnotes omitted). Judge Sack’s dissent pointed out that the
complaint alleged:
Early on October 8, 2002, at about 4 a.m., Mr. Arar was taken in
chains and shackles to a room where two INS officials told him that,
based on Mr. Arar’s casual acquaintance with certain named
individuals, including Mr. Almalki as well as classified information,
Defendant Blackman, Regional Director for the Eastern Region of
Immigration and Naturalization Services, had decided to remove Mr.
Arar to Syria. Without elaboration, Defendant Blackman also
stipulated that Mr. Arar’s removal would be consistent with Article
3 of CAT . . . .
Id. at 592 n.15 (quoting Arar’s complaint at ¶ 47) (quotation marks omitted). The complaint
also alleged:
The only notice given [Arar’s counsel prior to his interrogation late
on the evening of Sunday, October 6, 2002] was a message left by
Defendant McElroy, District Director for Immigration and
Naturalization Services for New York City, on [counsel’s] voice mail
at work that same [Sunday] evening. [She] did not retrieve the
message until she arrived at work the next day, Monday morning,
October 7, 2002—long after Mr. Arar’s interrogation had ended.
30

Arar, 585 F.3d at 592 n.16 (Sack, J., dissenting) (quoting Arar’s complaint at ¶ 43)
(quotation marks omitted) (alterations in original). The dissent found the allegations
sufficient:
[A]n identification of the unnamed defendants by their “roles” should
be sufficient to enable a plaintiff to survive a motion to dismiss, and
subsequently to use discovery to identify them. And while the
majority is correct that the complaint does not utter the talismanic
words “meeting of the minds” to invoke an agreement among the
defendants, it is plain that the logistically complex concerted action
allegedly taken to detain Arar and then transport him abroad implies
an alleged agreement by government actors within the United States
to act in concert.
Id. at 592 (internal citation omitted).
Judge Sack also argued that the denial of access to courts and counsel claim was improperly
dismissed because such a claim requires pleading “(1) a ‘nonfrivolous, arguable underlying
claim’ that has been frustrated by the defendants’ actions, and (2) a continued inability to
obtain the relief sought by the underlying claim,” and Judge Sack thought the pleadings were
sufficient. Id. at 592–93 Judge Sack explained:
But taking the allegations in the complaint as true, as we
must, the complaint clearly implies the existence of an underlying
claim for relief under CAT. The defendants can hardly argue that
under Arar’s assertions, which we take to be true, they lacked notice
of such a claim, since the complaint says that it was they who first
notified Arar about it: Arar alleges that on October 8, 2002, “two INS
officials told him that . . . Defendant Blackman . . . had decided to
remove [him] to Syria,” and “Defendant Blackman also stipulated
that [such action] would be consistent with Article 3 of CAT.”
Compl. ¶ 47. Indeed, the complaint alleges that Arar asked
defendants for reconsideration of that decision—i.e., relief from
it—in light of the prospect of torture in Syria, but the officials said
that “the INS is not governed by the ‘Geneva Conventions.’” Id.
Id. at 593 (alterations in original). Judge Sack’s dissent concluded:
Contrary to the district court’s ruling, then, Arar’s complaint
put the defendants on notice of claims seeking relief to bar his
removal that were frustrated by the defendants’ actions. Whatever
the ultimate merits of those claims, they would not have been
“frivolous.” And absent a remedy for the rendition and torture
themselves—the district court, and the majority, of course, conclude
31

there is none—no contemporaneous legal relief is now possible
except through the access to courts and counsel claim. The Fourth
Claim for Relief therefore states a sufficient due process access
claim.
Id. at 593–94 (internal citation omitted). Judge Sack’s dissent explained that the allegations
were sufficient under Iqbal:
More generally, we think the district court’s extended
recitation of the allegations in the complaint makes clear that the
facts of Arar’s mistreatment while within the United
States—including the alleged denial of his access to courts and
counsel and his alleged mistreatment while in federal detention in the
United States—were pleaded meticulously and in copious detail. The
assertion of relevant places, times, and events—and names when
known—is lengthy and specific. Even measured in light of Supreme
Court case law post-dating the district court’s dismissal of the fourth
claim, which instituted a more stringent standard of review for
pleadings, the complaint here passes muster. It does not “offer[ ]
‘labels and conclusions' or ‘a formulaic recitation of the elements of
a cause of action.’” Iqbal, 129 S. Ct. at 1949 (quoting Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167 L. Ed. 2d 929
(2007)). Nor does it “tender[ ] ‘naked assertion[s]’ devoid of ‘further
factual enhancement.’” Id. (quoting Twombly, 550 U.S. at 557, 127
S. Ct. 1955). Its allegations of a constitutional violation are
“‘plausible on [their] face.’” Id. (quoting Twombly, 550 U.S. at 555,
127 S. Ct. 1955). And, as we have explained, Arar has pled “factual
content that allows the court to draw the reasonable inference that the
defendant[s] [are] liable for the misconduct alleged.” Id. (quoting
Twombly, 550 U.S. at 556, 127 S. Ct. 1955). We would therefore
vacate the district court’s dismissal of the Fourth Claim for Relief.
Id. at 594 (emphasis added) (alterations in original).
With respect to the second and third claims, Judge Sack stated that even if the fourth claim
were properly dismissed, the dissenters “would still not concur in [the majority’s] crabbed
interpretation of Arar’s complaint in light of the facts alleged in it.” Arar, 585 F.3d at 594
(Sack, J., dissenting). Judge Sack noted that although Arar pleaded his fourth claim for
domestic detention separately from his other claims, the complaint had to be construed as
a whole. See id. at 595. Judge Sack explained:
According to the complaint: (1) Arar was apprehended by
government agents as he sought to change planes at JFK; (2) he was
not seeking to enter the United States; (3) his detention was for the
32

purpose of obtaining information from him about terrorism and his
alleged links with terrorists and terrorist organizations; (4) he was
interrogated harshly on that topic—mostly by FBI agents—for many
hours over a period of two days; (5) during that period, he was held
incommunicado and was mistreated by, among other things, being
deprived of food and water for a substantial portion of his time in
custody; (6) he was then taken from JFK to the MDC in Brooklyn,
where he continued to be held incommunicado and in solitary
confinement for another three days; (7) while at the MDC, INS
agents sought unsuccessfully to have him agree to be removed to
Syria because they and other U.S. government agents intended that
he would be questioned there along similar lines, but under torture;
(8) U.S. officials thwarted his ability to consult with counsel or
access the courts; and (9) thirteen days after Arar had been
intercepted and incarcerated at the airport, defendants sent him
against his will to Syria, where they allegedly intended that he be
questioned under torture and while enduring brutal and inhumane
conditions of captivity. This was, as alleged, all part of a single
course of action conceived of and executed by the defendants in the
United States in order to try to make Arar “talk.”
Id. Judge Sack explained that while “[i]t may not have been best for Arar to file a complaint
that structure[d] his claims for relief so as to charge knowing or reckless subjection to
torture, coercive interrogation, and arbitrary detention in Syria (the second and third claims)
separately from charges of cruel and inhuman conditions of confinement and ‘interfere[nce]
with access to lawyers and the courts’ while in the United States (the fourth claim)[,] . . .
such division of theories [wa]s of no legal consequence.” Id. (third alteration in original).
Judge Sack asserted that the factual allegations supporting the second and third claims were
much more comprehensive when the complaint was viewed as a whole:
The assessment of Arar’s complaint must, then, take into account the
entire arc of factual allegations that it contains—his interception and
arrest; his interrogation, principally by FBI agents, about his putative
ties to terrorists; his detention and mistreatment at JFK in Queens and
the MDC in Brooklyn; the deliberate misleading of both his lawyer
and the Canadian Consulate; and his transport to Washington, D.C.
and forced transfer to Syrian authorities for further detention and
questioning under torture. Such attention to the complaint’s factual
allegations, rather than its legal theories, makes perfectly clear that
the remaining claims upon which Arar seeks relief are not limited to
his “detention or torture in Syria,” . . . but include allegations of
violations of his due process rights in the United States. The scope
of those claims is relevant in analyzing whether a Bivens remedy is
available.
33

Id. at 595–96. After considering the complaint as a whole, Judge Sack’s dissent concluded
that the complaint did not present a new context for a Bivens remedy. See id. at 596. Even
if the context were new, Judge Sack thought “it mistaken to preclude Bivens relief solely in
light of a citation or compilation of one or more purported examples of . . . ‘special factors.’”
Id. at 600. Judge Sack disagreed with the majority’s conclusion with respect to most of the
special factors.7 He felt that secrecy issues should be dealt with through the state secrets
privilege. Arar, 585 F.3d at 603 (Sack, J., dissenting).
Judge Parker also filed a dissent, which was joined by Judges Calabresi, Pooler, and Sack.
Judge Parker asserted that the majority’s decision to dismiss the fourth count and “proceed[]
as though the challenged conduct [wa]s strictly extraterritorial . . . [went] far beyond any
pleading rule [the court was] bound to apply, and it [wa]s inconsistent with both Rule 8 of
the Federal Rules of Civil Procedure and recent Supreme Court decisions.” Id. at 616
(Parker, J., dissenting) (footnote omitted). Judge Parker explained:
Even after Ashcroft v. Iqbal, --- U.S. ----, ----, 129 S. Ct.
1937, 1949, 173 L. Ed. 2d 868 (2009), which dismissed
discrimination claims against policymakers on account of inadequate
pleading, Claim Four readily exceeds any measure of “plausibility.”
Claim Four seeks to hold Defendants John Ashcroft, Larry
Thompson, Robert Mueller, James Ziglar, J. Scott Blackman, Edward
McElroy, and John Does 1-10 responsible for the extreme conditions
under which Arar was held in the United States. While the majority
finds that Arar failed to allege the requisite “meeting of the minds”
necessary to support a conspiracy, see Maj. Op. 24, it ignores the fact
that Arar pleaded multiple theories of liability. Formal conspiracies
aside, he also alleges that the defendants commonly aided and abetted
his detention and removal—that is, that the defendants were
personally involved in his mistreatment both in the United States and
abroad.
Id. (footnote and citations omitted). Judge Parker further stated:
In support of his claim for mistreatment and due process
violations while in American custody, Arar includes factual

7

Judge Sack stated that the majority’s finding that extending a Bivens remedy in this context would essentially be a
constitutional challenge to executive policies was the strongest argument for denying a Bivens remedy. Arar, 585 F.3d
at 602 (Sack, J., dissenting). Judge Sack noted that “[a]fter Iqbal, it would be difficult to argue that Arar’s complaint
can survive as against defendants who are alleged to have been supervisors with, at most, ‘knowledge’ of Arar’s
mistreatment” but concluded that this did “not dispose of the cases against the lower-level defendants.” Id. (citation
omitted). Judge Sack further noted that “[i]t also may be that to the extent actions against ‘policymakers’ can be equated
with lawsuits against policies, they may not survive Iqbal either,” but asserted that “the relief Arar himself [sought was]
principally compensation for an unconstitutional implementation of [the extraordinary rendition] policy,” and that “[t]hat
is what Bivens actions are for.” Id.

34

allegations that are anything but conclusory. Indeed, he provides as
much factual support as a man held incommunicado could reasonably
be expected to offer a court at this stage. The complaint alleges that
Defendant McElroy was personally involved in Arar’s failure to
receive the assistance of counsel. It alleges that Defendants
Blackman and Thompson personally approved Arar’s expedited
transfer from the United States to Syria, implicating these officials in
his inability to access the courts. And it recounts statements by
Arar’s American interrogators that they were discussing his situation
with “Washington D.C.” More broadly, Arar details the harsh
conditions under which he was held, including shackling, strip
searches, administrative segregation, prolonged interrogation, and a
near communications blackout. Notably, these are not “[t]hreadbare
recitals of the elements of a cause of action, supported by mere
conclusory statements.” Iqbal, 129 S. Ct. at 1949. They easily
satisfy the requirements of both Iqbal and also Rule 8, whose “short
and plain statement” remains the baseline for notice-pleading. See
FED. R. CIV. P. 8(a)(2).
Moreover, as Iqbal made clear, plausibility is
“context-specific,” requiring the reviewing court “to draw on its
judicial experience and common sense.” Iqbal, 129 S. Ct. at 1950.
There, the Supreme Court rejected Iqbal’s discrimination claims
against high-ranking federal officials because his complaint lacked
sufficient factual allegations supporting the inference of
discriminatory intent. Id. at 1952. Central to the majority’s decision
was the fact that these officials faced a devastating terrorist attack
“perpetrated by 19 Arab Muslim hijackers.” Id. at 1951. Against this
backdrop, the majority found Iqbal’s claim overwhelmed by the
“obvious alternative explanation”—that his arrest stemmed from a
“nondiscriminatory intent to detain aliens . . . who had potential
connections to those who committed terrorist acts.” Id. at 1951
(quoting Twombly, 550 U.S. at 567, 127 S. Ct. 1955). Apparently
having their own views about the defendants’ state of mind, the
majority simply found Iqbal’s discrimination claim incredible.
Plausibility, in this analysis, is a relative measure.
Allegations are deemed “conclusory” where they recite only the
elements of the claim. They become implausible when the court’s
commonsense credits far more likely inferences from the available
facts. Plausibility thus depends on a host of considerations: The full
factual picture presented by the complaint, the particular cause of
action and its elements, and the available alternative explanations.
See Iqbal, 129 S. Ct. at 1947–52. As Rule 8 implies, a claim should
35

only be dismissed at the pleading stage where the allegations are so
general, and the alternative explanations so compelling, that the claim
no longer appears plausible. See FED. R. CIV. P. 8(a); Twombly, 550
U.S. at 556, 127 S. Ct. 1955 (requiring simply “enough fact to raise
a reasonable expectation that discovery will reveal evidence”
supporting the claims).
Arar’s claim readily survives this test, particularly in light of
the Court’s obligation to “draw[ ] all reasonable inferences in the
plaintiff’s favor” on a motion to dismiss.
Id. at 616–17 (additional internal citations omitted) (emphasis added) (alterations in
original). Judge Parker argued that “[t]he notion that high-ranking government officials like
Defendants Ashcroft and Mueller were personally involved in setting or approving the
conditions under which suspected terrorists would be held on American soil—and even
oversaw Arar’s detention and removal—is hardly far-fetched,” id. at 617–18, and
distinguished Iqbal:
In contrast to Iqbal, it is the alternative here that is difficult to
fathom. To think that low-level agents had complete discretion in
setting the conditions for holding a suspected member of al Qaeda
defies commonsense. It requires the Court to believe that, while
high-level officials were involved in arranging Arar’s removal to
Syria—a premise the majority does not question—they were
oblivious to the particulars of his detention. The majority was, of
course, bound to credit all reasonable inferences from the allegations
in the complaint, understanding that their factual basis would be
thoroughly tested in discovery. See Twombly, 550 U.S. at 555, 127
S. Ct. 1955 (a court must proceed “on the assumption that all the
allegations in the complaint are true (even if doubtful in fact)”). The
inference that, in 2002, high-level officials had a role in the detention
of a suspected member of al Qaeda requires little imagination.
Further, unlike Iqbal, Arar’s due process claims do not ask the
Court to speculate about the mental state of government officials.
Rather, Claim Four rests on objective factors—the conditions of
confinement and his access to the courts—that are independent of
motive. Compare Iqbal, 129 S. Ct. at 1948 (claim of invidious
discrimination requires the plaintiff to “plead and prove that the
defendant acted with discriminatory purpose”), with Kaluczky v. City
of White Plains, 57 F.3d 202, 211 (2d Cir. 1995) (government
conduct that is “arbitrary, conscience-shocking, or oppressive in a
constitutional sense” violates substantive due process). The
complaint contains more than sufficient factual allegations detailing
36

these deprivations.
Finally, it should not be lost on us that the Department of
Homeland Security’s Office of Inspector General has itself confirmed
the broad contours of Arar’s mistreatment, producing a lengthy report
on the conditions of his detention in American custody. This report
provides a powerful indication of the reliability of Arar’s factual
allegations at this stage . . . .
Ultimately, it is unclear what type of allegations to overcome
a motion to dismiss by high-level officials could ever satisfy the
majority. In refusing to credit Arar’s allegations, the majority cites
the complaint’s use of the “passive voice” in describing some of the
underlying events. This criticism is odd because the occasional use
of the passive voice has not previously rendered pleadings defective,
particularly where the defendants’ roles can be easily ascertained
from the overall complaint. See . . . Yoder v. Orthomolecular
Nutrition Institute, Inc., 751 F.2d 555, 561 (2d Cir. 1985) (“It is
elementary that, on a motion to dismiss, a complaint must be read as
a whole, drawing all inferences favorable to the pleader.”) (citations
omitted). Specifically, the majority faults Arar for not pinpointing
the individuals responsible for each event set out in the complaint and
for failing to particularize more fully when and with whom they
conspired. The irony involved in imposing on a plaintiff—who was
held in solitary confinement and then imprisoned for ten months in
an underground cell—a standard so self-evidently impossible to meet
appears to have been lost on the majority.
Id. at 618–19 (additional internal citations and footnotes omitted). Judge Parker expressed
concern with the majority’s approach:
The flaws in the majority’s approach are not unique to Arar,
but endanger a broad swath of civil rights plaintiffs. Rarely, if ever,
will a plaintiff be in the room when officials formulate an
unconstitutional policy later implemented by their subordinates. Yet
these closeted decisions represent precisely the type of misconduct
that civil rights claims are designed to address and deter. Indeed, it
is this kind of executive overreaching that the Bill of Rights sought
to guard against, not simply the frolic and detour of a few “bad
apples.” The proper way to protect executive officials from
unwarranted second-guessing is not an impossible pleading standard
inconsistent with Rule 8, but the familiar doctrine of qualified
immunity.

37

Even if the majority finds that Arar’s factual allegations fall
short of establishing the personal involvement of Defendants
Ashcroft and Mueller, they plainly state a claim against defendants
such as Thompson, Blackman, McElroy, and John Doe FBI and ICE
agents. The direct involvement of these defendants is barely
contested by the appellees and barely mentioned by the majority. For
this reason alone, there is no legal justification for the majority to
dismiss Claim Four outright.
Arar, 585 F.3d at 619 (Parker, J., dissenting) (internal citations omitted) (emphasis added).
Judge Pooler separately dissented, joined by Judges Calabresi, Sack, and Parker. Judge
Pooler asserted:
I would hold the Arar should have a Bivens remedy—to reinforce our
system of checks and balances, to provide a deterrent, and to redress
conduct that shocks the conscience. I understand the majority’s
opinion today to be a result of its hyperbolic and speculative
assessment of the national security implications of recognizing Arar’s
Bivens action, its underestimation of the institutional competence of
the judiciary, and its implicit failure to accept as true Arar’s
allegations that defendants blocked his access to judicial processes so
that they could render him to Syria to be tortured, conduct that shocks
the conscience and disfigures fundamental constitutional principles.
This is a hard case with unique circumstances. The majority’s
disappointing opinion should not be interpreted to change Bivens law.
Id. at 627 (Pooler, J., dissenting). Judge Pooler also disagreed with the majority’s decision
to dismiss the TVPA claim, noting that “[i]n the Section 1983 context, the Supreme Court
has held that private individuals may be liable for joint activities with state actors even
where those private individuals had no official power under state law.” Id. at 628. Judge
Pooler noted that “[b]ecause plaintiffs must meet a plausibility standard for claims against
federal officials under Ashcroft v. Iqbal, supra, [she was] not concerned that subjecting
federal officials to liability under the TVPA would open the floodgates to a waive of
meritless litigation.” Id. at 629 n.7.
Judge Calabresi filed a separate dissent, joined by Judges Pooler, Sack, and Parker. Judge
Calabresi stated: “[B]ecause I believe that when the history of this distinguished court is
written, today’s majority decision will be viewed with dismay, I add a few words of my own,
‘ . . . more in sorrow than in anger.’” Id. at 630 (Calabresi, J., dissenting) (quoting Hamlet,
act 1 sc. 2). Judge Calabresi argued that the majority decided a constitutional question
unnecessarily. See id. at 633–34. Judge Calabresi’s dissent did not separately address
pleading issues.

38

•

Meijer, Inc. v. Ferring B.V. (In re DDAVP Direct Purchaser Antitrust Litig.), 585 F.3d
677 (2d Cir. 2009). The plaintiffs, direct purchasers of the antidiuretic prescription
medication desmopressin acetate (DDAVP), filed a class action against Ferring B.V. and
Ferring Pharmaceuticals (collectively, “Ferring”) and Aventis Pharmaceuticals (“Aventis”),
alleging that the defendants abused the patent system to unlawfully maintain a monopoly
over DDAVP. Id. at 682. Ferring developed, patented, and manufactured DDAVP, and
Aventis had FDA approval for DDAVP tablets and a license from Ferring to market and sell
the drug. Id. The plaintiffs asserted that the defendants inflated the price of DDAVP by
suppressing generic competition for the tablets, in violation of antitrust laws. Id. The
district court dismissed the suit, finding that the plaintiffs lacked standing and that they
failed to state a claim upon which relief could be granted. Id.
Ferring had filed an earlier patent infringement suit against Barr Laboratories (“Barr”),
which was heard by the same district court that dismissed the present suit. Id. Barr had filed
an Abbreviated New Drug Application (“ANDA”) for a generic version of the DDAVP drug,
and filed a certification stating that Ferring’s patent for the DDAVP drug (the “’398 patent”)
was invalid, unenforceable, and/or would not be infringed by Barr’s generic version. Meijer,
585 F.3d at 682. Ferring’s suit alleged patent infringement, but the district court found on
summary judgment that the ’398 patent was unenforceable due to inequitable conduct before
the Patent and Trademark Office (PTO) by Ferring. Id. at 683. In “Ferring I,” the Federal
Circuit affirmed. Id. The ’398 patent had initially been rejected by PTO examiners as
anticipated by or obvious from another patent (the “’491 patent”), and this decision was
affirmed by the Board of Patent Appeals and Interferences on different grounds. Id. at 683.
Two Ferring employees then submitted declarations from several scientists stating that the
’491 patent and another article did not suggest the ’398 patent, but the employees failed to
disclose that four of the five declarants “previously had either ‘been employed or had
received research funds from Ferring.’” Id. Based on the declarations, the PTO issued the
’398 patent. Id. The district court found the failure to disclose the declarants’ relation to
Ferring to be inequitable conduct in the Barr litigation. On appeal in the Barr litigation, the
Federal Circuit held that the undisclosed affiliations would have been material to the
decision to issue the ’398 patent and that the relationships were “‘deliberately concealed.’”
Id. The Federal Circuit affirmed the district court’s decision to find the patent unenforceable
as against Barr and all other parties. Meijer, 585 F.3d at 683.
In the instant lawsuit, the plaintiffs alleged that the defendants’ conduct made the ’398 patent
unenforceable and violated the antitrust laws. Specifically,
[t]hey allege[d] that defendants Ferring and Aventis “engaged in an
exclusionary scheme” that included (1) “[p]rocuring the ’398 patent
by committing fraud and/or engaging in inequitable conduct before
the PTO,” (2) “[i]mproperly listing the fraudulently obtained ’398
patent in the [FDA’s] Orange Book,” thereby enabling patent
infringement claims against potential competitors, (3) prosecuting
sham infringement litigation against generic competitors, and (4)
39

“filing a sham citizen petition to further delay FDA final approval of
Barr’s ANDA.”
Id. (citation omitted) (third, fourth, and fifth alterations in original). The plaintiffs alleged
that “the lack of competing, generic versions of DDAVP injured them by forcing them to pay
monopolistic prices for the drug.” Id. The district court acknowledged that under Walker
Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172, 173 (1965), a patentee
loses First Amendment immunity for obtaining and enforcing a patent, and can incur
antitrust liability for enforcing a patent, if the patent was obtained by fraud on the PTO. Id.
at 684. But the district court concluded that the plaintiffs failed to plead fraud on the PTO
with particularity, “noting that fraud requires a greater showing of culpability than the
inequitable conduct that can render a patent unenforceable.” Id. Although the district court
found this sufficient for dismissal, it also concluded that the plaintiffs lacked antitrust
standing. Id. The district court also rejected the non-Walker Process claims, including the
Orange Book listing, the sham infringement litigation, and the sham citizen’s petition,
finding that the defendants had “not acted ‘in subjective bad faith.’” Id. The district court
also dismissed the claims against Aventis because the plaintiffs had failed to sufficiently
allege that Aventis was complicit in Ferring’s fraud on the PTO. Meijer, 585 F.3d at 684.
In addressing jurisdiction, the Second Circuit found that it had jurisdiction because the
plaintiffs’ theory that the defendants failed to supplement, amend, or withdraw their citizen
petition, which asked the FDA to conduct additional testing of the generic drug after the
defendants knew that the patent was unenforceable, “could plausibly constitute a Sherman
Act violation,” and therefore “support[ed] a patent-independent theory of liability.” See id.
at 687 (citing Twombly, 550 U.S. at 566 (“suggesting that either ‘action or inaction’ could
be plausibly alleged as an antitrust violation”)). The Second Circuit also found that the
plaintiffs had standing.
In considering the adequacy of the complaint, the Second Circuit found that the antitrust
claim was plausible under Iqbal. The plaintiffs’ first theory, Walker-Process fraud, required
showing:
(1) a representation of a material fact, (2) the falsity of that
representation, (3) the intent to deceive or, at least, a state of mind so
reckless as to the consequences that it is held to be the equivalent of
intent (scienter), (4) a justifiable reliance upon the misrepresentation
by the party deceived which induces him to act thereon, and (5)
injury to the party deceived as a result of his reliance on the
misrepresentation.
Id. at 692 (quoting Nobelpharma AB v. Implant Innovations, Inc., 141 F.3d 1059, 1069–70
(Fed. Cir. 1998)) (quotation marks omitted). The court noted that Rule 9 requires “[a] party
‘alleging fraud or mistake . . . [to] state with particularity the circumstances constituting
fraud or mistake.’” Id. (quoting FED. R. CIV. P. 9(b)). The court found that the plaintiffs had
40

“alleged a series of ‘highly material’ omissions, without which ‘the ’398 patent would not
have issued,’” and that “[t]he Federal Circuit agreed on the ‘high[] material[ity]’ of the
omissions when it found the ’398 patent unenforceable.” Id. (second and third alterations
in original). The court further found that “[t]he Ferring I litigation also addressed the third
element of intent, as the district court found ‘clear and convincing evidence of an intent to
mislead the examiners.’” Id. (citation omitted). Finally, the court found that “[r]eliance and
injury, the fourth and fifth elements, [we]re straightforward here: the PTO was justified in
relying on the information the defendants provided, and injury is a ‘matter of course
whenever the other four elements are met.’” Meijer, 585 F.3d at 692 (citation omitted). The
Second Circuit rejected the defendants’ argument that the district judge’s involvement in
both the patent litigation finding the patent unenforceable and the instant litigation “enabled
him to validly conclude that his previous findings could not support a claim of fraudulent
procurement in the instant case.” Id. The Second Circuit described the defendants’
argument as “a logical non sequitur,” explaining that “[t]he district court could be correct
in determining that inequitable conduct occurred and yet mistaken that such conduct did not
amount to fraud,” and that “the defendants’ argument ignore[d] the distinction between
findings and pleadings” because “[e]ven if the district court was correct that the earlier
record did not show fraud, the record in this case could be different following discovery.”
Id. (emphasis added). The court also rejected the defendants’ argument that “simply adding
a conclusory allegation of fraud to the previous findings is inadequate to meet the plaintiffs’
obligation to ‘allege facts that give rise to a strong inference of fraudulent intent,” noting that
courts are “‘lenient in allowing scienter issues to withstand summary judgment based on
fairly tenuous inferences,’ because such issues are ‘appropriate for resolution by the trier of
fact,’” and “[t]he same holds true for allowing such issues to survive motions to dismiss.”
Id. at 693 (quoting Press v. Chem. Inv. Servs. Corp., 166 F.3d 529, 538 (2d Cir. 1999)). The
court concluded that “[t]he district court found ‘an intent to deceive’ in the patent litigation,”
and that “[g]ranting the plaintiffs all favorable inferences as we must on a motion to dismiss,
and given that the omissions at issue occurred repeatedly over a period of years, this intent
is sufficient to plausibly support a finding of Walker Process fraud.” Id.
The Second Circuit also rejected the defendants’ argument that the plaintiffs needed to allege
intent separate from the omission itself. Id. The court noted that “[w]hile a false or clearly
misleading statement can permit an inference of deceptive intent, a misrepresentation in the
form of an omission is more likely to be innocent and cannot support Walker Process fraud
without ‘evidence of intent separable from the simple fact of the omission.’” Meijer, 585
F.3d at 693 (quoting Dippin’ Dots, Inc. v. Mosey, 476 F.3d 1337, 1347 (Fed. Cir. 2007)).
The court further noted that “[t]he issue in the initial infringement litigation was inequitable
conduct, not Walker Process fraud,” and that “the district court in that litigation correctly
noted that high materiality could overcome a lesser showing of intent.” Id. The court
concluded that “[w]hile such balancing is impermissible with Walker Process claims, we
think the plaintiffs’ allegations are nonetheless sufficient.” Id. The court explained that
“Dippin’ Dots concerned findings, not pleadings; even if the district court’s findings in the
Ferring I litigation could not satisfy Dippin’ Dots, the plaintiffs’ pleadings could plausibly
lead to additional findings that would satisfy Dippin’ Dots, which is all that is required at
41

this stage of the litigation.” Id. (internal citation omitted) (emphasis added).
The Second Circuit further rejected the defendants’ argument that the allegations of
materiality were insufficient to support a claim for Walker Process fraud. The defendants
had argued that because the plaintiffs did not dispute the patentability of the ’398 patent on
the merits or claim that, but for the fraud, no patent could have issued to anyone, the
plaintiffs’ claim had to fail. Id. The court explained that “Walker Process fraud must
concern a material issue of patentability; otherwise, a patent would have issued regardless
of any fraud, and potential plaintiffs would have suffered the same monopoly effects (but
legitimately).” Id. The court found that even though “the plaintiffs [did] not address
patentability directly in their complaint, the issue [was] implicit in their allegations.” Meijer,
585 F.3d at 693. The court explained:
The defendants’ allegedly fraudulent affidavits were attempts to
explain away prior art. The Federal Circuit found them ‘absolutely
critical’ to the defendants’ overcoming the patent application’s initial
rejection. Ferring I, 437 F.3d at 1189. Whether or not these
declarations, if accompanied by full disclosure, would have resulted
in an enforceable patent is debatable, but we think that, at the
pleading stage, the fact of non-disclosure is sufficient to properly
allege materiality. Overall, then, the plaintiffs have sufficiently
alleged Walker Process fraud to survive the defendants’ motion to
dismiss on the pleadings.
Id. at 693–94 (emphasis added).
The Second Circuit also concluded that the sham litigation claim was properly pleaded. This
claim required alleging that “‘the litigation in question is: (i) ‘objectively baseless,’ and (ii)
‘an attempt to interfere directly with the business relationships of a competitor through the
use of the governmental process . . . as an anticompetitive weapon.’’” Id. at 694 (quoting
Primetime 24 Joint Venture v. Nat’l Broadcasting Co., 219 F.3d 92, 100–02 (2d Cir. 2000)).
The court found that “[b]ased on the same facts alleged to sustain a Walker Process claim,
. . . in the circumstances of this case, the plaintiffs’ allegations are also sufficient to make
out a sham litigation claim,” and that “[t]he defendants effectively concede[d] as much” by
arguing that the sham litigation claim was duplicative of the patent fraud claim. Id. The
court further concluded that the Orange Book claim could proceed, finding that “[h]aving
determined that the Walker Process and sham litigation theories are still in play, . . . the
plaintiffs ha[d] adequately alleged that the defendants improperly listed the ’398 patent in
the FDA’s Orange Book.” Id.
Finally, the Second Circuit concluded that the citizen petition theory was adequately
pleaded. The court explained:
The district court dismissed this theory on the basis that it concerned
42

petitioning activity protected by the First Amendment. To reach this
conclusion, the district court presumably reasoned that the plaintiffs
could not plausibly show the petition to be a sham, i.e., objectively
and subjectively baseless, a proposition with which we disagree. The
FDA found that the citizen petition “had no convincing evidence”
and lacked “any basis” for its arguments. In the Ferring I litigation,
the district court suggested that the petition might have been “nothing
more than a hardball litigation tactic, motivated by a desire to keep
out competition for as long as possible after the expiration of the
patent and raise transactional costs for Barr.” Ferring B.V., 2005 WL
437981, at *17. Together these findings indicate the plaintiffs could
plausibly show the citizen petition to have been a sham.
Id. (internal citations omitted). The defendants argued that the citizen petition could not be
the basis for antitrust liability because “it could not have impacted the FDA’s decision, as
the FDA ultimately rejected the petition.” Meijer, 585 F.3d at 694. The court rejected that
argument, explaining that it “ignore[d] the possibility that the sham petition caused a delay
in generic competition, a possibility reinforced by the fact that the FDA approved the generic
drug on the same day that it rejected the petition.” Id. (citation omitted). The court found:
Whether the ’398 patent was valid on the date the petition was filed
is immaterial to this theory’s success, because the plaintiffs can
plausibly show the patent to have been fraudulently procured. It may
turn out at trial that this petition was not a sham, or that the FDA’s
approval of the generic drug was not delayed by the petition, but the
possibility that the petition was a sham, and that it impacted the
FDA’s decision, is sufficiently plausible to defeat the motion to
dismiss.
Id. at 694–95 (emphasis added). The court concluded that “[o]verall, the plaintiffs have
stated an antitrust claim upon which relief may be granted,” noting that “[b]ased on the
pleadings, each of their four theories could plausibly succeed.” Id. at 695.
The Second Circuit also found that the district court had erred by dismissing the claims
against Aventis on the basis that the fraud had not been pleaded with sufficient particularity
under Rule 9. The district court had concluded that the theory “‘[t]hat Aventis would pay
to license a patent which it knew to be unenforceable fl[ew] in the face of reason,’” but the
Second Circuit found the “allegations plausible, and sufficient to survive a motion to dismiss
on the pleadings.” Id. The Second Circuit explained:
At the time Aventis filed its [new drug application] and listed
DDAVP in the Orange Book, the ’398 patent’s validity was already
in question with the patent having been rejected twice, and the PTO
having raised concerns of bias. Yet, the plaintiffs assert that Aventis
43

apparently made no effort to independently investigate and attest to
the validity of the ’398 patent. Rule 9(b) requires only the
circumstances of fraud to be stated with particularity; knowledge
itself can be alleged generally. Especially considering the longstanding relationship between Aventis and Ferring, the plaintiffs have
adequately stated circumstances that give rise to a plausible inference
of knowledge and liability. At this early stage, the plaintiffs need
only state a plausible claim of monopolization, and they have alleged
enough for their suit against Aventis to proceed.
Id. (internal citation omitted).
•

Selevan v. N.Y. Thruway Auth., 584 F.3d 82 (2d. Cir. 2009). The plaintiffs challenged an
interstate highway toll policy that provided a discount to residents of a particular New York
city. The defendant’s policy allowed residents of Grand Island, New York to pay as little
as nine cents per trip on the Grand Island Bridges, while others were required to pay 75
cents. Id. at 86–87. The plaintiffs, individuals who had paid the non-resident toll during
trips through New York to New Jersey for shopping, tourism, and other activities, brought
suit under § 1983, alleging that the policy violated the dormant Commerce Clause and the
plaintiffs’ rights under the Equal Protection Clause and the Privileges and Immunities Clause
of the Fourteenth Amendment, the Privileges and Immunities Clause of Article IV of the
Constitution, and the Equal Protection Clause of the New York Constitution. Id. at 87. The
district court dismissed the complaint, finding that the plaintiffs lacked standing under the
“prudential standing” doctrine8 because the claims were not within the “zone of interests”
protected by the Commerce Clause, the Fourteenth Amendment’s Equal Protection Clause,
or the Privileges and Immunities Clause of Article IV. Id. at 87–88. The district court did
not consider whether the complaint stated a claim under the Privileges and Immunities
Clause of the Fourteenth Amendment because the complaint merely recited that provision,
and the court concluded that even if the plaintiffs had standing to bring their equal protection
claim, they failed to state a claim. Id. at 88.
On appeal, the Second Circuit held that the plaintiffs had met the Article III standing
requirements. The court concluded that the district court had improperly dismissed the
complaint for lack of prudential standing, noting that “the zone-of-interests requirement
invoked by the District Court in this case is ‘not a rigorous one.’” Id. at 91 (quoting Nat’l
Weather Serv. Employees Org., Branch 1-18 v. Brown, 18 F.3d 986, 989 (2d Cir. 1994))
(additional citation omitted). The Second Circuit also noted that “[b]ecause this cause comes
before us following a decision on a motion to dismiss, we need only consider whether the
complaint alleges a plausible claim that the regulation violates the Commerce Clause,”

8

“The Supreme Court has held that ‘prudential standing encompasses the general prohibition on a litigant’s raising
another person’s legal rights, the rule barring adjudication of generalized grievances more appropriately addressed in
the representative branches, and the requirement that a plaintiff’s complaint fall within the zone of interests protected
by the law invoked.’” Selevan, 584 F.3d at 91 (quoting Elk Grove Unified Sch. Dist. v. Newdow, 542 U.S. 1, 12 (2004)).

44

Selevan, 584 F.3d at 92 (citing Iqbal, 129 S. Ct. at 1950), and that “[w]hether the 75-cent
toll is actually a burden on interstate commerce is a question left for later proceedings.” Id.
(emphasis added). The Second Circuit also reasoned that dismissal was not appropriate
based on the argument that the defendants were acting as “market participants.” Id. at
93–94. “The [market participant] doctrine ‘differentiates between a State’s acting in its
distinctive governmental capacity, and a State’s acting in the more general capacity of a
market participant; only the former is subject to the limitations of the [dormant] Commerce
Clause.’” Id. at 93 (quoting New Energy Co. of Ind. v. Limbach, 486 U.S. 269, 277 (1988)).
The court concluded that “at least in this stage of the litigation, a finding that [the defendant]
acted as a ‘market participant’ (rather than in its governmental capacity) is not warranted,”
explaining that “the toll may well be permissible, but, absent a finding that [the defendant]
acted as a market participant, it is subject to scrutiny under the dormant Commerce Clause.”
Id. at 94.
In considering whether the complaint stated a claim under the dormant Commerce Clause,
the court noted that the plaintiffs had alleged that the “toll policy discriminates against
interstate commerce and that, in the alternative, it imposes a burden on interstate commerce
that is not justified by any benefits it creates.” Id. at 95. The court noted that “in order to
state a claim for discrimination in violation of the Commerce Clause, a plaintiff must
‘identify an[ ] in-state commercial interest that is favored, directly or indirectly, by the
challenged statutes at the expense of out-of-state competitors,’” id. (quoting Grand River
Enters. Six Nations, Ltd. v. Pryor, 425 F.3d 158, 169 (2d Cir. 2005) (internal quotation
marks omitted)), and found that the plaintiffs had “failed to ‘identify an[ ] in-state
commercial interest that is favored,’” and had not “point[ed] to a particular ‘out-of-state
competitor’ that [wa]s harmed by [the defendant’s] toll policy.” Selevan, 584 F.3d at 95.
As a result, the court concluded that the plaintiffs had failed to allege that the “toll policy
‘discriminates’ against interstate commerce.” Id.
The Second Circuit explained that while the district court had correctly determined that the
plaintiffs failed to allege that the policy discriminated against interstate commerce, the
district court had failed to inquire whether the policy otherwise violated the Commerce
Clause. Id. The court noted that under Pike v. Bruce Church, Inc., 397 U.S. 137, 142
(1970), “a nondiscriminatory regulation that ‘regulates even-handedly to effectuate a
legitimate local public interest,’ is nevertheless unconstitutional if ‘‘the burden imposed on
interstate commerce is clearly excessive in relation to the putative local benefits.’’” Id.
(internal citations omitted). The court found the allegations sufficient to survive dismissal:
As noted, plaintiffs have alleged that [the defendant’s] policy of
charging non-residents of Grand Island tolls that are more than eight
times greater than the tolls charged to Grand Island residents
“place[s] burdens on interstate commerce that exceed any local
benefit that allegedly may be derived from them.” Because at this
state of a suit we are required to assume all “well-pleaded factual
allegations” are true and assess the complaint only to “determine
45

whether [the allegations] plausibly give rise to an entitlement to
relief” at this stage of litigation, Iqbal, 129 S.Ct. at 1950, we
conclude that plaintiffs’ allegations are sufficient to survive a motion
to dismiss.
Id. (internal citation omitted) (emphasis added) (second and third alterations in original).
The court further explained that although the lead plaintiffs in the putative class had alleged
only a small injury to themselves, the court was “confident that neither the number of
prospective class members nor the cumulative difference between the tolls they paid and
those paid by Grand Island residents [wa]s negligible,” and noted that “whether a state
policy violates the dormant Commerce Clause does not depend on the extent of its impact
on an individual plaintiff,” but “must be judged by its overall economic impact on interstate
commerce in relation to the putative local benefits conferred.” Id. at 95–96 (citing Pike, 397
U.S. at 142).
The Second Circuit directed the district court on remand to “undertake the inquiry prescribed
by the Supreme Court for determining whether a fee imposed by a governmental entity to
defray the cost of facilities used by those engaged in interstate commerce violates the
dormant Commerce Clause or the right to travel . . . .” Selevan, 584 F.3d at 96. Under the
relevant Supreme Court precedent, “states are always permitted to require interstate travelers
‘to bear a fair share of the costs of providing public facilities that further travel,’” id.
(quoting Evansville-Vanderburgh Airport Auth. District v. Delta Airlines, Inc., 405 U.S. 707,
712 (1972)), and “a fee is reasonable and constitutionally permissible ‘if it (1) is based on
some fair approximation of use of the facilities, (2) is not excessive in relation to the benefits
conferred, and (3) does not discriminate against interstate commerce.’”9 Id. (quoting
Northwest Airlines, Inc. v. County of Kent, 510 U.S. 355, 369 (1994)). The court noted that
“[w]hether the fee schedule exception provided to Grand Island residents violates the
dormant Commerce Clause will depend in part on whether the fee represents a fair
approximation of that group’s use of the bridge—an inquiry that is too fact-dependent to be
decided upon examination of the pleadings.” Id. at 98 (citing Northwest Airlines, 510 U.S.
at 369) (emphasis added).
The Second Circuit also disagreed with the district court’s determination that the complaint
failed to assert a claim for violation of the right to travel under the Fourteenth Amendment’s
Privileges and Immunities Clause, finding that the “plaintiffs’ complaint supplied a detailed
description of [the defendant’s] Grand Island Bridge toll policy,” and “[u]nder the heading
‘Causes of Action,’ the complaint alleged that [the defendant’s] toll policy deprived
plaintiffs of ‘their constitutional rights under the Privileges and Immunities Clause of Article
IV and/or the Fourteenth Amendment by charging them more for traveling than [the
defendant] charged certain New York State residents.’” Id. at 99. The court held that

9

The Second Circuit noted that it had already determined that the amended complaint failed to allege that the policy
discriminated against interstate commerce, and that, as a result, unless the plaintiffs were given leave to amend their
complaint, the district court only had to assess the other two factors on remand. Selevan, 584 F.3d at 98 n.4.

46

“[t]aken together, plaintiffs’ allegations clearly implicate[d] a violation of plaintiffs’ right
to travel under the Fourteenth Amendment’s Privileges and Immunities Clause . . . .” Id.
The Second Circuit noted that the plaintiffs had not alleged that they routinely paid the full
toll to commute to work or that the toll had some other significant financial impact on them,
but only that they paid the toll on the way to New Jersey for shopping and other activities,
and concluded that “[t]hese facts suggest at most a ‘minor restriction’ on plaintiffs’ right to
travel, rather than a ‘penalty.’” Id. at 101 (footnote omitted). But the court held:
“Nevertheless, plaintiffs’ allegations implicate a possible violation of the right to travel in
the context discussed in Evansville inasmuch as they contend that they have been charged
an excessive toll for use of the Grand Island Bridge while residents of New York are charged
substantially less.” Selevan, 584 F.3d at 101–02. The court concluded that “the District
Court erred in applying rational basis review to [the defendant’s] toll policy,” and directed
the district court on remand to “determine whether the toll policy implicates the right to
travel in the context discussed in Evansville and, if so, . . . to apply strict scrutiny.” Id. at
102. The court further directed that if the district court “[found] that the toll [wa]s merely
a ‘minor restriction on travel’ that d[id] not amount to the denial of a fundamental right, then
the District Court [should] apply the Northwest Airlines test to determine if the toll
discriminate[d] against interstate commerce.” Id. (internal citation omitted).
Finally, the Second Circuit held that the district court had properly dismissed the claim
alleged under the Privileges and Immunities Clause of Article IV by one of the plaintiffs,
who was a U.S. citizen residing in Canada, because “neither the text nor the purpose of the
Privileges and Immunities Clause of Article IV—integrating the various states into a
coherent whole—would be served by extending its protection to residents of foreign
countries, even U.S. citizens residing in foreign countries.” Id. at 103.
•

Panther Partners Inc. v. Ikanos Commc’ns, Inc., No. 08-3398, 2009 WL 2959883 (2d Cir.
Sept. 17, 2009) (unpublished summary order). The plaintiff alleged that defendant Ikanos,
and various directors and underwriters, negligently made false statements in connection with
the company’s initial public offering and its secondary offering, in violation of the Securities
and Exchange Act of 1933. Id. at *1. The district court dismissed the complaint under Rule
12(b)(6), denied leave to amend, and denied a request to reconsider. Id.
The Second Circuit concluded that the standard applied by the district court was too strict,
but nonetheless concluded that the complaint was not sufficient under the more lenient
standard described in Twombly. See id. at *2. The complaint alleged that “‘[b]y January
2006, Ikanos learned that the VDSL Version Four chips were failing,’” and that “‘Ikanos
determined that the VDSL Version Four chips had a failure rate of 25 % [to] 30%, which
was extremely high.’” Id. (alteration in original). The Second Circuit found that the district
court had improperly required the plaintiff to allege when Ikanos knew the failure rate was
specifically 25 to 30%, and explained that the plaintiff only needed to allege that Ikanos
knew of abnormally high failure rates before the company published the registration
statement accompanying its secondary offering. Id. The court explained: “The plausibility
standard would not require that plaintiff assert, for example, exactly when the company
47

knew the difference in defect rates between the VDSL chips and other chips was statistically
significant. The plausibility standard, however, does require a statement alleging that they
knew of the above-average defect rate before publishing the registration statement.” Id. The
court concluded that “the amended complaint failed to meet the plausibility requirements of
Twombly because it did not allege facts sufficient to complete the chain of causation needed
to prove that defendants negligently made false statements.” Panther Partners, 2009 WL
2959883, at *2.
In reviewing the district court’s denial of reconsideration, the Second Circuit noted that the
proposed second amended complaint alleged additional facts, but none of those facts
resolved the critical issue of when the company knew that the defect rates were unusually
high. Id. at *3. However, the court found that amendment might cure the defect, stating:
“[C]ourts may consider all possible amendments when determining futility. Because it
seems to us possible that plaintiff could allege additional facts that Ikanos knew the defect
rate was above average before filing the registration statement, and that this allegation, if
made, would be sufficient to meet the high standards that Iqbal and Twombly require for
pleadings, further amendment may not be futile.” Id. at *4 (emphasis added). The court
concluded: “[W]e recognize that Iqbal and Twombly raised the pleading requirements
substantially while this case was pending,” and vacated the district court’s denial of the
motion to reconsider its decision to deny leave to amend. Id. (emphasis added).
•

W. Va. Inv. Mgmt. Bd. v. Doral Fin. Corp., No. 08-3867-cv, 2009 WL 2779119 (2d Cir.
Sept. 3, 2009) (unpublished summary order). The plaintiffs alleged that defendant
PricewaterhouseCoopers LLP (“PWC”) and others violated Section 10(b) of the Securities
and Exchange Act of 1934 and Rule 10b-5 by issuing four audits and one report for Doral
Financial Corporation that were materially false. Id. at *1. The plaintiffs further alleged that
these audits and reports allowed Doral to conceal frauds, including overstating pre-tax
income and understating debt. Id. PWC moved to dismiss for failure to state a claim,
asserting that the complaint failed to allege facts giving rise to a strong inference of scienter,
as required by the Private Securities Litigation Reform Act of 1995 (PSLRA). Id. The
district court dismissed the complaint, and the Second Circuit affirmed.
The Second Circuit noted that a plaintiff can meet the required showing of a strong inference
of scienter “by alleging facts ‘(1) showing that the defendants had both motive and
opportunity to commit the fraud or (2) constituting strong circumstantial evidence of
conscious misbehavior or recklessness.’” Id. (quoting ASTI Commc’ns, Inc. v. Shaar Fund,
Ltd., 493 F.3d 87, 99 (2d Cir. 2007) (emphasis added by Doral court)). The Second Circuit
explained that the allegations of PWC’s carelessness did not create a strong inference of
scienter because the inference of scienter is required to be “at least as compelling as an
opposing inference, though it need not be more probable than not,” and “[i]n this case, the
opposing inference—that Doral concealed its fraud from [PWC], just as it concealed its fraud
from investors—[wa]s objectively more compelling than plaintiffs’ allegations of
recklessness.” Id. at *2. The court differentiated the plausibility standard required for
general pleading from the more stringent standard under the PSLRA:
48

Although plaintiffs’ allegations that Pricewaterhouse was reckless are
arguably “plausible” under the general pleading standards established
by the Supreme Court in Bell Atlantic Corp. v. Twombly, 550 U.S.
544 (2007) and Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009), the PSLRA
requires in this litigation context more than mere plausibility.
Instead, the allegations must create an inference “at least as
compelling as any opposing inference one could draw from the facts
alleged.” Tellabs, Inc.[ v. Makor Issues & Rights, Ltd.], 551 U.S.
[308,] 324[ (2007)]. Because the competing inference that [PWC]
was deceived is stronger than the inference that they were reckless,
we conclude that plaintiffs’ complaint does not meet the pleading
requirements of the PSLRA, and therefore that it was proper for the
District Court to dismiss it.
Doral Financial, 2009 WL 2779119, at *3.
•

Bruno v. Metro. Transp. Auth., No. 08-1993-cv, 2009 WL 2524009 (2d Cir. Aug. 19, 2009)
(unpublished summary order). The plaintiff sued his employer under the Federal Employers’
Liability Act, which provides that a railroad engaged in interstate commerce will be liable
“‘to any person suffering injury while he is employed by such carrier in such commerce . .
. for such injury or death resulting in whole or in part from the negligence of any of the
officers, agents, or employees of such carrier,” id. at *1 (quoting 45 U.S.C. § 51), and which
requires “‘the plaintiff [to] prove the traditional common law elements of negligence: duty,
breach, foreseeability, and causation,’” id. (quoting Tufariello v. Long Island R.R., 458 F.3d
80, 87 (2d Cir. 2006)).
The Second Circuit concluded that the plaintiff’s claim that “he suffered ‘severe and
disabling injuries’ as a result of the [defendant’s] policy that requires its employees who are
not on active work status to remain at home during working hours, unless they receive a ‘no
work’ status” was “implausible on its face.” Id. The court justified dismissal by noting that
the complaint did not allege that the defendant had any duty to grant the “no work” status
or that there was a causal link between the policy and the plaintiff’s injuries, and that the
plaintiff alleged “no facts apart from conclusory assertions as to how the MTA’s denial of
his no work status caused unspecified ‘severe and disabling injuries.’” Id. The court
concluded that the claim was frivolous. Id.
The Second Circuit concluded that the plaintiff’s second claim, “that on or prior to
September 13, 2001, the [defendant] assigned [the plaintiff] to work at or near the World
Trade Center, and that he sustained ‘severe and disabling injuries’ by reason of the
[defendant’s] negligence,” should also be dismissed. Bruno, 2009 WL 2524009, at *1. The
court explained that the plaintiff had conceded that he was precluded from bringing this
claim in the absence of fraud because of a release he signed, and that he had not pleaded
fraud. Id.

49

•

South Cherry Street, LLC v. Hennessee Group LLC, 573 F.3d 98 (2d Cir. 2009). The
plaintiff alleged breach of contract and violation of § 10(b) of the Securities and Exchange
Act of 1934 and Rule 10b-5 promulgated by the SEC, in connection with the defendant’s
alleged failure to learn and disclose that a hedge fund in which the plaintiff invested on the
defendant’s recommendation was part of a Ponzi scheme. Id. at 99–100. The district court
dismissed the contract claim as barred by the Statute of Frauds, and dismissed the securities
fraud claim on the ground that the complaint failed to plead scienter as required by the
PSLRA. Id. at 100. The Second Circuit affirmed.
The PSLRA requires that “‘[i]n any private action arising under this chapter in which the
plaintiff may recover money damages only on proof that the defendant acted with a
particular state of mind, the complaint shall, with respect to each act or omission alleged to
violate this chapter, state with particularity facts giving rise to a strong inference that the
defendant acted with the required state of mind.’” Id. at 110 (quoting 15 U.S.C. § 78u4(b)(2)) (emphasis added by South Cherry Street court). The court explained that “‘[a]
plaintiff alleging fraud in a § 10(b) action . . . must plead facts rendering an inference of
scienter at least as likely as any plausible opposing inference.’” Id. at 111 (quoting Tellabs,
551 U.S. at 328) (emphasis added by South Cherry Street court). “And in determining
whether this standard has been met, the court must consider whether ‘all of the facts alleged,
taken collectively, give rise to a strong inference of scienter, not whether any individual
allegation, scrutinized in isolation, meets that standard.’” Id. (quoting Tellabs, 551 U.S. at
323). The court concluded that the complaint “lack[ed] sufficient factual allegations to give
rise to a strong inference of either fraudulent intent or conscious recklessness.” South
Cherry Street, 573 F.3d at 112. The court found that the complaint failed to allege
intentional misrepresentation because it alleged only that the defendant would have learned
about the problems with the recommended funds if it had performed the due diligence it
promised, and did not allege that the defendant had any knowledge that its representations
about the funds were untrue. See id. The court also found that the complaint failed to allege
recklessness because the complaint alleged only that the defendant breached its contractual
obligation by failing to take obvious investigative steps and ignoring clear red flags, but did
not allege that the defendant did not believe the funds’ representations were accurate or any
facts that the defendant knew that either made the falsity of the funds’ representations
obvious or that should have alerted the defendant that the representations were questionable.
Id. The court concluded that while it might be plausible to infer that the defendant had acted
negligently, it was “far less plausible to infer that an industry leader that prides itself on
having expertise that is called on by Congress, that emphasizes its thorough due diligence
process, that values and advertises its credibility in the industry—and that evaluates 550
funds—would deliberately jeopardize its standing and reliability, and the viability of its
business, by recommending to a large segment of its clientele a fund as to which it had made,
according to South Cherry, little or no inquiry at all.” Id. at 113.
Although the court was examining the heightened pleading requirements under the PSLRA,
it focused on the plausibility standard and discussed the need to plead more than speculation
in order to meet the requirements of Rule 8. The Second Circuit noted that the plaintiff’s
50

assertion on appeal that it would be appropriate to draw the inference that the defendant
acted illegally appeared nowhere in the complaint and the plaintiff had conceded that the
inference was speculative. Id. The court continued:
[The plaintiff] argues that because such facts would be peculiarly
within the knowledge of the defendants, it had no obligation to
include such an allegation in the Complaint, intimating that it might
hope to develop some such evidence in discovery. To be sure, South
Cherry should not include such an allegation in its pleading without
having a “factual basis or justification,” FED. R. CIV. P. 11 Advisory
Committee Note (1993). But “before proceeding to discovery, a
complaint must allege facts suggestive of illegal conduct,” Twombly,
550 U.S. at 564 n.8, 127 S. Ct. 1955; and a plaintiff whose
“complaint is deficient under Rule 8 . . . is not entitled to discovery,”
Iqbal, 129 S. Ct. at 1954. South Cherry’s confessed inability to offer
more than speculation that there may have been such unlawful
conduct underscores, rather than cures, the deficiency in the
Complaint.
Id. at 113–14 (emphasis added).
•

Harris v. Mills, 572 F.3d 66 (2d Cir. 2009). The plaintiff, formerly licensed by the state of
New York as a doctor of osteopathic medicine, had his medical license revoked because he
committed fraud and engaged in improper medical practices. The New York State Education
Department denied the plaintiff’s petition to reinstate his license, and the plaintiff brought
a pro se action under the Americans with Disabilities Act (ADA), the Rehabilitation Act, and
42 U.S.C. § 1983, claiming that he was illegally denied a reasonable accommodation for his
cognitive disabilities and unconstitutionally deprived of due process. Id. at 68. The district
court dismissed the accommodation claims under the ADA and the Rehabilitation Act
against the individual defendants because the statutes did not provide for individual liability,
and dismissed the Rehabilitation Act claim and the remaining claims for failure to state a
claim. The Second Circuit affirmed the finding that the claims were legally insufficient,
“even when read with the lenity that must attend the review of pro se pleadings.” Id.
The plaintiff’s first accommodation claim alleged that “the Education Department wrongly
denied him an ‘understanding of the impact of [his] disabilities,’” which deprived him of a
fair reinstatement hearing, and prevented the Department from properly assessing his
“‘rehabilitation.’” Id. at 74 (citation omitted). The Second Circuit noted that the complaint
did not identify how the plaintiff’s disabilities affected the behavior that caused the
revocation of his license or how those disabilities could be accommodated to reform that
behavior. Id. The court explained that “[g]enerally construed, this allegation amount[ed]
only to the contention that Harris’s medical licensing qualifications should be relaxed in
light of his disability,” but “[t]his [wa]s not a reasonable accommodation claim.” Id.

51

The plaintiff’s second accommodation claim—based on denial of the opportunity “to read
to the Committee on Professions a written explanation so his case ‘would be more organized
and clearly presented’”—failed because, even liberally construed, there was no allegation
that the plaintiff was denied the opportunity to read his statement “‘by reason’ of his
disability, let alone ‘solely by reason’ of his disability, as the Rehabilitation Act requires.”
Harris, 572 F.3d at 74–75. It was also unclear how the requested accommodation would
have helped, since the plaintiff alleged “‘difficulty with comprehending the written word’
and ‘a related problem with written expression.’” Id. at 75 (citations omitted).
The plaintiff’s due process claim was dismissed because the plaintiff “was given notice and
an opportunity to be heard before his petition for reinstatement was denied,” and state law
provided an adequate post-deprivation hearing for the denial of his petition to reinstate his
license. Id. at 76.
Finally, the court found dismissal appropriate for the “cause of action that the defendants’
decisions were ‘[a]rbitrary and capricious’ inasmuch as the defendants failed to follow their
own procedural rules.” Id. (citation omitted). The court found that “[i]nsofar as this [wa]s
intended to be a stand-alone legal claim based solely on violations of state regulations, it
[wa]s not actionable in federal court,” and “therefore state[d] no claim upon which relief
c[ould] be granted.” Id.

Third Circuit
•
Arango v. Winstead, No. 09-3506, 2009 WL 3863335 (3d Cir. Nov. 19, 2009) (unpublished)
(per curiam). A state prisoner, proceeding pro se, filed a civil rights action against the
prison’s superintendent, alleging that the plaintiff’s civil rights were violated when prison
officials wrongly accused her of sexual harassment, failed to follow proper procedures in
investigating, punished her with a 30-day cell restriction, and removed her from participating
in a Sex Offender Program for six months. Id. at *1. The district court dismissed the
complaint, finding that it was not cognizable under section § 1983 because the “favorable
termination rule” provided that “a § 1983 plaintiff cannot seek damages for harm caused by
actions that implicate the validity of the fact or length of her confinement, unless she can
prove that the sanction has been reversed, invalidated, or called into question by a grant of
federal habeas corpus relief.” Id. “[C]laims that relate only to the conditions, and not the
fact or duration, of incarceration are not subject to the favorable termination rule.” Id.
(citations omitted). The Third Circuit concluded that the district court had erred in applying
the favorable termination rule because the challenged actions did not alter the length of the
plaintiff’s incarceration. Id. at *2. But the court affirmed on another ground, finding that
the complaint did not state a claim for relief. The court explained:
The Supreme Court has recognized that “[a]s long as the conditions
or degree of confinement to which the prisoner is subjected is within
the sentence imposed upon him and is not otherwise violative of the
Constitution, the Due Process Clause does not in itself subject an
52

inmate’s treatment by prison authorities to judicial oversight.”
Asquith v. Dep’t of Corr., 186 F.3d 407, 410 (3d Cir. 1999) (quoting
Hewitt v. Helms, 459 U.S. 460, 468 (1983)). Due process applies
only where the conditions of confinement impose “atypical and
significant hardship[s] on the inmate in relation to the ordinary
incidents of prison life.” Sandin v. Connor, 515 U.S. 472, 484
(1995). Placement in administrative segregation for days or months
at a time or transfers to more restrictive custody do not implicate a
protected liberty interest. See Torres, 292 F.3d at 150; Fraise v.
Terhune, 283 F.3d 506, 522–23 (3d Cir. 2002). Nor does removal
from a prison program, as restriction from participation in prison
programs is among the conditions of confinement that an inmate may
reasonably anticipate during her incarceration. See James v. Quinlan,
866 F.2d 627, 629 (3d Cir. 1989). Therefore, Arango’s complaint,
alleging that she was removed from a program and placed in thirty
days restrictive housing, did not state a plausible violation of a
protected liberty interest.10
Id. (alterations in original).
•

United States ex rel. Lobel v. Express Scripts, Inc., No. 09-1047, 2009 WL 3748805 (3d
Cir. Nov. 10, 2009) (unpublished). The plaintiff, a former employee of the defendant
pharmacy benefit manager, claimed that the defendant had falsely certified its compliance
with a regulation governing filling prescriptions. Id. at *1. The district court dismissed
under Rule 12(b)(6), and the Third Circuit affirmed. The Third Circuit explained that to
state a claim under the False Claims Act, the plaintiff “must allege that: (1) defendant
violated the regulation; (2) defendant certified its compliance with the regulation to a federal
payor in spite of its violation of the regulation; and (3) defendant’s certification of
compliance was a condition of payment.” Id. (citation omitted). The express certification
claim failed because the complaint did not “identify a single claim submitted by ESI in
which it represented falsely to the Government that it complied with regulations that affect
its eligibility for payment.” Id. The court noted that the case law clearly did not provide a
cause of action without such an identification. See id. The district court also found that the
implied certification claim failed, noting that the plaintiff relied on Conley, which had been
overruled by Twombly. Id. The court concluded: “Lobel’s failure even to cite Twombly and
Iqbal in either of his two briefs is a telling omission. When Lobel’s amended complaint is
analyzed under the more exacting standard established by those cases, it falls well short.”
Id. The court explained that of the seven paragraphs that the plaintiff relied upon to state a
claim, two merely quoted the False Claims Act; four “allege[d] in a conclusory fashion that
[the defendant] violated the False Claims Act by submitting claims for prescriptions filled
in violation of § 1306.05,” and therefore were not presumed to be true under Iqbal, and the

10

Although the court concluded that the complaint did not state a “plausible” claim, it appeared to base its decision on
the fact that the law did not provide for the relief requested, not based on a lack of plausible facts.

53

one alleging materiality was “a legal conclusion which the District Court was not obliged
to accept as true.” Lobel, 2009 WL 3748805, at *2 (citing Iqbal, 129 S. Ct. at 1949). The
court also found the allegations legally deficient, noting that “[i]n addition to these factual
deficiencies, . . . we agree with [the defendant] that the violation of § 1306.05 Lobel alleges
cannot, as a matter of law, give rise to liability under the False Claims Act because
compliance with the regulation is not a ‘condition of payment.’” Id. (citation omitted).
•

Twillie v. Ohio, No. 09-3182, 2009 WL 3683782 (3d Cir. Nov. 6, 2009) (unpublished) (per
curiam). The pro se complaint against various FBI field offices “alluded generally to
‘retaliation tactics’ and ‘harassment.’” Id. at *1. The claims arose out of “circumstances
that precipitated [the plaintiff’s] arrest for indecent assault in Pennsylvania, his sentence for
the crime, his decision to go to California after his sentencing, and his subsequent arrest and
extradition in Pennsylvania.” Id. The district court construed the complaint as seeking relief
under Bivens for harassment and retaliation against the FBI, and dismissed because a Bivens
claim cannot be maintained against a federal agency. Id. The district court denied leave to
amend, finding that any amendment to state a Bivens claim would be futile. Id. On appeal,
the Third Circuit found that the district court had “explicitly and obviously construed
Twillie’s claims liberally, affording him the allowances due a pro se litigant,” and then
found, “[s]imilarly construing the complaint liberally,” that “Twillie presented claims against
a federal agency, not against individual officers or agents of a federal agency,” and that such
claims could not “be raised under Bivens.” Id. at *2 (citation omitted). Although the court
found the allegations legally insufficient, it also noted that an alternative basis for affirming
the district court was that the claims were not plausible. See Twillie, 2009 WL 3683782, at
*2. The court concluded that the “allegations, rife with suppositions (he even uses the word
‘guess’ in presenting one aspect of his claim) and lacking in specificity, are simply not
plausible.” Id. The court held that “[t]he facts he plead[ed], even construed liberally, d[id]
not allow [the court] to infer more than the mere possibility of misconduct, which d[id] not
show [the court] that he [wa]s entitled to relief.” Id. (citing Iqbal, 129 S. Ct. at 1950). The
Third Circuit also affirmed the denial of leave to amend, finding that the FBI could not be
sued under Bivens and that “it [wa]s not apparent how Twillie could transform his
implausible claims into plausible claims.” Id. The court concluded that “[t]o the extent that
Twillie makes us aware, through his informal brief, of claims that he would have wanted to
present in an amendment, we note that those claims are similarly speculative and
implausible.” Id.

•

Shahin v. Darling, No. 09-3298, 2009 WL 3471297 (3d Cir. Oct. 29, 2009) (unpublished)
(per curiam). The pro se complaint asserted claims against nine Delaware judges, two law
firms, and two court reporters, and sought damages for alleged violations of the plaintiff’s
federal and constitutional rights. Id. at *1. The plaintiff alleged that in connection with
three lawsuits she had filed in Delaware state court, the “defendants engaged in coercion,
criminal conspiracy, retaliation, and witness tampering, resulting in rulings against Shahin
in all three actions.” Id. (footnote omitted). The district court dismissed the complaint and
denied leave to amend. The Third Circuit affirmed. With respect to the judges, the court
found that they were absolutely immune from suits for monetary damages, absent allegations
54

of bad faith or malice, and “there [we]re no facts in the complaint to support inferences that
any of the named judges acted outside the scope of his or her judicial capacity or in the
absence of jurisdiction.” Id. (citing Mireles v. Waco, 502 U.S. 9, 11 (1991)). The claims
against the law firms and the court reporters failed because the “complaint fail[ed] to allege
any facts to support [the plaintiff’s] federal or constitutional claims.” Id. The court
explained:
Shahin alleges that during the state proceedings, one lawyer was
substituted for another lawyer, a lawyer filed a motion without
affording her proper notice, and a lawyer engaged in ex parte
communications with the presiding judge. Even taking the
allegations as true, the complaint does not contain any facts that
would allow one to reasonably infer that the defendants violated
federal or constitutional law. Shahin’s conclusory allegations are
insufficient to plausibly demonstrate that any of the defendants
violated Shahin’s civil or constitutional rights. See Iqbal, 129 S. Ct.
at 1949.
Id. (footnote omitted). The Third Circuit agreed that amendment would have been futile,
“[g]iven that . . . there [we]re no facts to infer that any of the defendants violated Shahin’s
federal or constitutional rights . . . .” Id. at *2.
•

Merritt v. Fogel, No 08-3622, 2009 WL 3383257 (3d Cir. Oct. 22, 2009) (unpublished) (per
curiam). The plaintiff, a Pennsylvania state prisoner serving a life sentence, filed a pro se
lawsuit against medical professionals and Department of Corrections employees under
section 1983, asserting that the defendants were deliberately indifferent to the plaintiff’s
medical needs, in violation of the Eighth Amendment, and asserting a state law claim for
medical malpractice. Id. at *1. The complaint alleged that the plaintiff had Hepatitis C and
had been repeatedly refused treatment. Id. The magistrate judge recommended that the
Eighth Amendment claim be dismissed for failure to state a claim, that the state law claim
be dismissed for failure to comply with a state certificate of merit requirement, and that the
motions to amend be denied. Id. at *2. The district court accepted these recommendations.
Id. The Third Circuit first noted that the district court had improperly dismissed the
complaint because it should have construed the plaintiff’s initial motion for leave to amend
as an amended complaint, given that the plaintiff was entitled to file his first amended
complaint as of right, and that the amended complaint would have rendered the defendants’
motions to dismiss moot. Id. Despite this procedural error, the Third Circuit considered the
merits, and also found that the district court had improperly dismissed on that basis. Merritt,
2009 WL 3383257, at *3.
With respect to the Eighth Amendment claim, the district court had found that the allegations
of deliberate indifference were inadequate. “Deliberate indifference . . . requires more than
mere malpractice or disagreement with a particular course of treatment,” and “the Magistrate
Judge reasoned that Merritt’s allegations show[ed] that he merely disagree[d] with
55

defendants’ medical judgment and insist[ed] on the treatment of his choice.” Id. But the
Third Circuit explained that the plaintiff had alleged much more:
If that were all that Merritt alleged, then the Magistrate Judge
would be right. Merritt, however, makes many other specific factual
allegations that the Magistrate Judge did not discuss and that, taken
as true as they must be at this stage, raise an inference of deliberate
indifference. For example, Merritt alleges that one of defendants’
own specialists recommended him for treatment as long ago as 1996
but that defendants fraudulently concealed that information from him
until he finally filed suit. He also alleges that he is within the
protocol for treatment, though various defendants have falsely told
him otherwise. Thus, as Merritt argues, he claims to seek, not merely
the treatment of his own choice, but treatment that has been
recommended by a specialist and that is called for by the Department
of Corrections protocol.
Moreover, his allegations permit the inference that defendants
may have nonmedical reasons for refusing to provide this treatment.
For example, he alleges that defendant Falor told him both that
medical staff merely “shrug their shoulders, indicating nothing” when
the subject of HCV treatment arises at staff meetings and that Merritt
would not receive treatment though his liver numbers were “all out
of wack” and that he should instead “pray.” He also alleges that he
overheard a physician’s assistant admit to having shredded his sick
call requests. Finally, he alleges that has been denied treatment for
at least five different reasons over the years, most of which he alleges
were fabricated.
Taken together, and in light of Merritt’s pro se status, we
believe that these specific factual allegations permit the inference that
at least some defendants have acted with deliberate indifference to
Merritt’s medical needs. Thus, for pleading purposes, Merritt’s
factual allegations have “‘nudged his claim . . . across the line from
conceivable to plausible.’” Iqbal, 129 S.Ct. at 1951 (quoting
Twombly, 550 U.S. at 570). For that reason, the District Court should
not have dismissed Merritt’s complaint without leave to amend and
should not have denied his motions for leave to amend as futile.
Accordingly, we will vacate the dismissal of Merritt’s complaint and
remand with an instruction to allow him to file an amended
complaint.
Id. at *3–4 (footnote omitted).

56

•

Lawson v. Nat’l Continental-Progressive Ins. Co., No. 09-2239, 2009 WL 3182930 (3d Cir.
Oct. 6, 2009) (unpublished) (per curiam). After the plaintiff’s state court suit alleging that
the defendant had wrongfully terminated an insurance policy held by the plaintiff’s bus
company was dismissed, the plaintiff filed a pro se complaint against the same defendant
insurance company in federal court. Id. at *1. The federal complaint alleged the same
breach of contract claim brought in state court, and asserted claims under the First, Fourth,
Eighth, and Fourteenth Amendments, as well as violations of 42 U.S.C. § 1881, 1855, 1982,
1986, and 1988. Id. The district court dismissed the complaint on the defendant’s motion,
finding that the complaint failed to allege any facts to support the federal and constitutional
claims, and that the breach of contract claim was barred by res judicata. Id. The Third
Circuit agreed that the federal and constitutional claims lacked factual support:
We agree with the District Court that Lawson’s complaint fails to
allege any facts to support his federal or constitutional claims. While
Lawson alleges that National Insurance denied Nate’s Transportation
insurance coverage and added a premium without reason, the
complaint does not contain any facts that would allow one to
reasonably infer that its actions violated federal or constitutional law.
Lawson’s conclusory allegations are insufficient to plausibly
demonstrate that National Insurance violated Lawson’s civil or
constitutional rights.
Id. at *2. The appellate court also agreed that the breach of contract claim was barred by res
judicata. Id. The Third Circuit concluded that leave to amend would be futile, “[g]iven that
. . . Lawson previously litigated th[e] breach of contract claim in New Jersey Superior Court
and there [we]re no facts to infer that National Insurance violated his federal or
constitutional rights . . . .” Lawson, 2009 WL 3182930, at *2.

•

Gelman v. State Farm Mutual Auto. Ins. Co., 583 F.3d 187 (3d Cir. 2009). The plaintiff’s
putative class action complaint alleged that the defendant violated the Fair Credit Reporting
Act (FCRA) by obtaining a copy of the plaintiff’s credit report from a credit reporting
agency and using it to select the plaintiff to receive materials regarding insurance products
that the plaintiff might want. Id. at 188–89. The plaintiff “contend[ed] that the State Farm
mailing [wa]s nothing more than promotional material soliciting him to contact State Farm
regarding its various insurance products and that it [wa]s therefore not the kind of firm offer
of insurance that would legitimize State Farm’s access to his credit report under federal law.”
Id. at 189. The district court dismissed the complaint, holding that “Gelman failed to state
a claim for his false pretenses and permissible purpose claims because State Farm’s mailer
constituted an offer of insurance under the FCRA, and that was a ‘permissible purpose’ for
disclosing Gelman’s credit report.” Id. at 190.
The Third Circuit agreed that the false pretenses and permissible purpose claims failed,
rejecting the plaintiff’s argument that the mailer did not have any value to him and therefore
did not constitute a firm offer of insurance. Id. at 193–94. Besides the fact that the plaintiff
57

did not “explain what ‘value’ the mailer should have provided him,” the court found that the
statute did “not mention ‘value,’ or anything akin to it.” Gelman, 583 F.3d at 194. The court
also explained that “even assuming arguendo that Congress intended to limit a firm offer to
one that has value pursuant to the analysis in [another case], Gelman’s argument would still
be undermined by subsequent decisions limiting the reach of [that other case] to
circumstances that do not exist here.” Id. The court noted that the statute defined a “firm
offer” as “‘any offer of . . . insurance to a consumer that will be honored if the consumer is
determined, based on information in a consumer report, to meet the specific criteria used to
select the consumer for the offer.’” Id. at 195 (quoting 15 U.S.C. § 1681a(l)). “The mailer
. . . stated that the offer of insurance contained therein would be honored if Gelman met
certain criteria.” Id. The court noted that “Gelman did not allege that he responded to State
Farm’s mailing and was denied insurance even though he satisfied the pre-screening
criteria,” noting that “[t]hat would present a very different scenario that we need not now
consider.” Id. The Third Circuit affirmed the district court’s dismissal.11 Id. at 196.
•

Cann v. Hayman, No. 08-3032, 2009 WL 3115752 (3d Cir. Sept. 30, 2009) (unpublished)
(per curiam). A state prison inmate filed a pro se lawsuit against several prison officials
under § 1983, alleging violations of his civil rights, including First Amendment retaliation,
Fourth Amendment unreasonable search, Eighth Amendment cruel and unusual punishment,
and Fourteenth Amendment due process/equal protection claims. Id. at *2. The district
court dismissed the complaint for failure to state a claim; the Third Circuit affirmed and
found that granting leave to amend would be futile. The plaintiff alleged that he had filed
a grievance in which he accused prison officials of tampering with his inmate account. Id.
at *1. The plaintiff further alleged that nearly two months after the grievance was filed, he
set off a metal detector three times and then refused to comply with an officer’s order
regarding another search method. Id. Based on this refusal, the plaintiff was placed in a
special cell and subjected to additional searches, but none of these measures resulted in
finding contraband. Id. The plaintiff was charged with disciplinary infractions for failure
to comply with the officer’s order. In reviewing the complaint, the Third Circuit noted that
pro se pleadings are liberally construed. Id. at *2 (citing Erickson v. Pardus, 551 U.S. 89
(2007)). The court found that the complaint “lack[ed] facial plausibility because the
complained-of actions by the prison officials were not improper, let alone unconstitutional,
given Cann’s ‘triple-triggering’ of the metal detector in the yard and his subsequent refusal
to comply with Martain’s order . . . .” Cann, 2009 WL 3115752, at *2 (internal citation to
Iqbal, 129 S. Ct. at 1949, omitted). The court held that “[t]he responsive actions take[n] by
prison officials were rationally related to legitimate penological interests and goals,” and
concluded that the district court had appropriately dismissed the complaint. Id.

•

Miles v. Twp. of Barnegat, No. 08-1387, 2009 WL 2840733 (3d Cir. Sept. 4, 2009)
(unpublished) (per curiam). The plaintiffs, siblings who inherited six contiguous properties

11

Although the Third Circuit cited Iqbal in its discussion of the standard of review for motions to dismiss, the dismissal
appeared to be on the grounds that the law provided no relief for the asserted claims, not that the factual allegations were
implausible. The court did not cite Iqbal in the “discussion” portion of its opinion.

58

in the Township of Barnegat, alleged that the Township created public rights of way on their
property, approved plans for water drainage from adjacent properties, and granted easements
to private development corporations for water drainage on their property. Id. at *1. The
overflow from detention basins allegedly flooded the plaintiffs’ property, creating a wetland,
and the county’s underground storm tunnels allegedly contributed to the flooding. Id. The
plaintiffs also alleged that neighboring landowners improperly encroached on their property
and granted easements to the property; that cable and electric companies placed utility lines,
cables, and telephone wires on their property without consent; that the surveyor defendants
omitted or misstated information to diminish the plaintiffs’ property value; and that the
engineering defendants encroached on their property by placing detention basins too close
to the boundary, causing water runoff to flood their land. Id. The plaintiffs filed suit under
§ 1983, alleging violations of their Fifth Amendment rights under the Takings Clause,
violations of procedural due process, and a § 1983 conspiracy to encroach on and diminish
the property. Id. The plaintiffs also alleged that the Township fraudulently changed the
boundaries of their property on Township maps. Id. The district court dismissed the takings
claims for lack of jurisdiction because they were unripe; dismissed the procedural due
process claims because New Jersey provided a judicial mechanism for challenging the
Township’s decision to build a road on their property; and dismissed the remainder of the
§ 1983 claims for failure to state a plausible claim of state action by private party defendants.
The district court declined to exercise jurisdiction over the pendant state law claims. Miles,
2009 WL 2840733, at *2. The Third Circuit affirmed.
After describing the pleading standards in Twombly and Iqbal, the Third Circuit concluded
that the district court had properly dismissed the procedural due process claims because
“[v]iewing the allegations as true, the factual matter f[ell] far short of permitting [the court]
to infer a plausible connection among the private party defendants and a governmental
agency or official such that their private actions would constitute ‘state action.’” Id. at *3
(citations omitted). “[T]he single-sentence conclusory allegations of a conspiracy contained
in the Amended Complaint [we]re insufficient to allege a plausible conspiracy among the
defendants to deprive the Plaintiffs of their constitutional rights under § 1983.” Id. (citing
Iqbal, 129 S. Ct. at 1949; Kost v. Kozakiewicz, 1 F.3d 176, 185 (3d Cir. 1993)).
•

McTernan v. City of York, 577 F.3d 521 (3d Cir. 2009). The complaint alleged that the
plaintiffs have devout religious beliefs, including a belief that their religion requires them
to share their beliefs with others, and that based on these beliefs, they protested against
abortions outside a Planned Parenthood facility (the “Facility”). Id. at 524. The Facility was
next to a public sidewalk and had a ramp leading to its front entrance that ran parallel to the
sidewalk. Id. The plaintiffs alleged that a survey they conducted showed that 2.9 feet of this
ramp were constructed on the public right of way. Id. The plaintiffs also alleged that they
contacted the Commissioner of the city police department to request that the encroaching
portion of the ramp be removed. Id. Because the ramp and a banner allegedly encroached
on the public right of way, the plaintiffs asked a city policy officer if they could go on the
ramp to communicate with clients entering the Facility. Id. The officer refused and stated
that he would arrest the plaintiffs if they entered the ramp. McTernan, 577 F.3d at 524. The
59

plaintiffs sued the officer, the commissioner of the police department, and the city, claiming
violations of their rights to free exercise of religion, peaceful assembly, and freedom of
speech. Id. The defendants moved to dismiss, relying on regulations under the ADA that
placed certain restrictions on the ramp at issue. Id. at 524–25. The district court denied the
plaintiffs’ request for a preliminary injunction, and dismissed the complaint based on finding
that the ramp was a nonpublic forum and that plaintiffs had not suffered any constitutional
injury. Id. at 525–26. The Third Circuit affirmed.
The Third Circuit rejected the plaintiffs’ argument that the district court was required to
accept as true the statement in the complaint that the ramp was a public forum. Id. at 531.
Relying on Iqbal, the court found that this statement was a legal conclusion that did not need
to be accepted as true. Id. The finding that the ramp was nonpublic was supported by
attachments to the complaint that depicted the ramp and its overlap with the public sidewalk.
McTernan, 577 F.3d at 531. The court concluded that “[i]f Plaintiffs were not excluded from
a public forum, they ha[d] failed ‘‘to state a [First Amendment] claim to relief that [wa]s
plausible on its face.’’” Id. (quoting Iqbal, 129 S. Ct. at 1949).
The Third Circuit also concluded that the claim of a violation of the plaintiffs’ right to free
exercise of religion failed because:
In the complaint, Plaintiffs do not allege that they are treated
differently than others, and instead claim only that “Defendants’
actions target and are intended to chill, restrict, and inhibit Plaintiffs
from exercising their religion in this way” and that “Defendants’
actions constituted a substantial burden on Plaintiffs[’] religious
exercise, and Defendants lacked a compelling justification.” App. at
48. Once again, these are merely conclusory allegations, and, as the
Court stated in Iqbal, “[t]hreadbare recitals of the elements of a cause
of action, supported by mere conclusory statements, do not suffice.”
Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550 U.S. at 555, 127 S.Ct.
1955).
Id. at 532 (alterations in original) (footnote omitted).
•

Fowler v. UPMC Shadyside, 578 F.3d 203 (3d Cir. 2009). The plaintiff was employed by
UPMC as a janitor at the Shadyside Hospital. She was injured and placed on
Family/Medical Leave and short-term disability, and eventually given a clerical position.
Id. at 206. UPMC eliminated the plaintiff’s clerical position, and the plaintiff alleged that
before her position was eliminated, she applied for a similar job but was never contacted
about that position. Id. The district court dismissed the complaint because the
Rehabilitation Act’s two-year statute of limitations had run, the restriction to sedentary work
did not constitute a disability under the Rehabilitation Act, and the class action allegations
were not appropriate claims under the Rehabilitation Act. Id. The Third Circuit vacated the
dismissal and remanded.
60

The Third Circuit noted that it was “obligated to discuss recent changes in pleading
standards.” Id. at 209. The court stated:
Standards of pleading have been in the forefront of
jurisprudence in recent years. Beginning with the Supreme Court’s
opinion in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S. Ct.
1955, 167 L. Ed. 2d 929 (2007), continuing with our opinion in
Phillips [v. County of Allegheny, 515 F.3d 224 (3d Cir. 2008)], and
culminating recently with the Supreme Court’s decision in Ashcroft
v. Iqbal, --- U.S. ----, 129 S. Ct. 1937, 1955, 173 L. Ed. 2d 868
(2009), pleading standards have seemingly shifted from simple notice
pleading to a more heightened form of pleading, requiring a plaintiff
to plead more than the possibility of relief to survive a motion to
dismiss.
Id. at 209–10 (emphasis added). The court described Iqbal’s holding:
The Supreme Court’s opinion [in Iqbal] makes clear that the
Twombly “facial plausibility” pleading requirement applies to all civil
suits in the federal courts. After Iqbal, it is clear that conclusory or
“bare-bones” allegations will no longer survive a motion to dismiss:
“threadbare recitals of the elements of a cause of action, supported by
mere conclusory statements, do not suffice.” Iqbal, 129 S. Ct. at
1949. To prevent dismissal, all civil complaints must now set out
“sufficient factual matter” to show that the claim is facially plausible.
This then “allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Id. at 1948. The
Supreme Court’s ruling in Iqbal emphasizes that a plaintiff must
show that the allegations of his or her complaints are plausible. See
[i]d. at 1949–50; see also Twombly, 550 U.S. at 555, & n.3, 127 S.
Ct. 1955.
Fowler, 578 F.3d at 210. The court continued:
Iqbal additionally provides the final nail-in-the-coffin for the
“no set of facts” standard that applied to federal complaints before
Twombly. See also Phillips, 515 F.3d at 232–33. Before the
Supreme Court’s decision in Twombly, and our own in Phillips, the
test as set out in Conley v. Gibson, 355 U.S. 41, 45–46, 78 S. Ct. 99,
2 L. Ed. 2d 80 (1957), permitted district courts to dismiss a complaint
for failure to state a claim only if “it appear[ed] beyond doubt that the
plaintiff can prove no set of facts in support of his claim which would
entitle him to relief.” Id. Under this “no set of facts” standard, a
61

complaint effectively could survive a motion to dismiss so long as it
contained a bare recitation of the claim’s legal elements.
The Supreme Court began its rejection of that test in
Twombly, holding that a pleading offering only “labels and
conclusions” or “a formulaic recitation of the elements of a cause of
action will not do.” Twombly, 550 U.S. at 555, 127 S. Ct. 1955;
Phillips, 515 F.3d at 232. In Phillips, we discussed the appropriate
standard for evaluating Rule 12(b)(6) or 12(b)(1) motions in light of
the anti-trust context presented in Twombly, holding that the
acceptable statement of the standard remains: “courts accept all
factual allegations as true, construe the complaint in the light most
favorable to the plaintiff, and determine whether, under any
reasonable reading of the complaint, the plaintiff may be entitled to
relief.” Phillips, 515 F.3d at 233 (internal quotations and citation
omitted). The Supreme Court’s opinion in Iqbal extends the reach of
Twombly, instructing that all civil complaints must contain “more
than an unadorned, the-defendant-unlawfully-harmed-me
accusation.” Iqbal, 129 S.Ct. at 1949.
Therefore, after Iqbal, when presented with a motion to
dismiss for failure to state a claim, district courts should conduct a
two-part analysis. First, the factual and legal elements of a claim
should be separated. The District Court must accept all of the
complaint’s well-pleaded facts as true, but may disregard any legal
conclusions. Id. Second, a District Court must then determine
whether the facts alleged in the complaint are sufficient to show that
the plaintiff has a “plausible claim for relief.” Id. at 1950. In other
words, a complaint must do more than allege the plaintiff’s
entitlement to relief. A complaint has to “show” such an entitlement
with its facts. See Phillips, 515 F.3d at 234–35. As the Supreme
Court instructed in Iqbal, “[w]here the well-pleaded facts do not
permit the court to infer more than the mere possibility of
misconduct, the complaint has alleged—but it has not
‘show[n]’—‘that the pleader is entitled to relief.’” Iqbal, 129 S. Ct.
at 1949. This “plausibility” determination will be “a context-specific
task that requires the reviewing court to draw on its judicial
experience and common sense.” Id.
Id. at 210–11 (emphasis added) (alterations in original).
The Fowler court then examined the effect of Twombly and Iqbal on the holding in
Swierkiewicz v. Sorema N.A., 534 U.S. 506 (2002), in which the Supreme Court held that “a
complaint alleging unlawful employment discrimination did not have to satisfy a heightened
62

pleading requirement.” Fowler, 578 F.3d at 211. The court explained that the continuing
vitality of some of the holdings in Swierkiewicz might be questionable:
The Supreme Court in Swierkiewicz expressly adhered to Conley’s
then-prevailing “no set of facts” standard and held that the complaint
did not have to satisfy a heightened standard of pleading. Id.
Swierkiewicz and Iqbal both dealt with the question of what sort of
factual allegations of discrimination suffice for a civil lawsuit to
survive a motion to dismiss, but Swierkiewicz is based, in part, on
Conley, which the Supreme Court cited for the proposition that Rule
8 “relies on liberal discovery rules and summary judgment motions
to define disputed facts and issues and to dispose of unmeritorious
claims.” 534 U.S. at 512, 122 S. Ct. 992. We have to conclude,
therefore, that because Conley has been specifically repudiated by
both Twombly and Iqbal, so too has Swierkiewicz, at least insofar as
it concerns pleading requirements and relies on Conley.
Id.
The Third Circuit found that the complaint in Fowler had “alleged sufficient facts to state
a plausible failure-to-transfer claim,” noting that “[a]lthough Fowler’s complaint is not as
rich with detail as some might prefer, it need only set forth sufficient facts to support
plausible claims.” Id. at 211–12 (footnote omitted). The court explained:
Taking her allegations as true, we find (1) that she was injured
at work and that, because of this injury, her employer regarded her as
disabled within the meaning of the Rehabilitation Act; (2) that there
was an opening for a telephone operator at UPMC, which was
available prior to the elimination of her position and for which she
applied; (3) that she was not transferred to that position; (4) that
UPMC never contacted her about the telephone operator position or
any other open positions; and (5) that Fowler believed UPMC’s
actions were based on her disability. Under the “plausibility
paradigm” . . . , these averments are sufficient to give UPMC notice
of the basis for Fowler’s claim. The complaint pleads how, when,
and where UPMC allegedly discriminated against Fowler. She avers
that she was injured on the job and that her doctor eventually released
her to perform “sedentary work.” She pleads that UPMC gave her a
light-duty clerical position. She also avers that before the elimination
of her light duty clerical position, she applied for a telephone operator
position, but “was never contacted by UPMC regarding that
position.” Fowler further alleges that she contacted “Susan Gaber, a
Senior Human Resources Consultant with the Defendant, UPMC
Shadyside, regarding [a] number of vacant sedentary jobs,” but that
63

she was “never contacted by UPMC regarding any open positions.”
Fowler’s complaint alleges that UPMC “failed to transfer” her to
another position in September of 2003. Fowler further pleaded that
she was “terminated because she was disabled” and that UPMC
discriminated against her by failing to “transfer or otherwise obtain
vacant and funded job positions” for her. The complaint repeatedly
references the Rehabilitation Act and specifically claims she was
terminated because of her disability. Therefore, she has nudged her
claims against UPMC “across the line from conceivable to plausible.”
Twombly, 550 U.S. at 570. The factual allegations in Fowler’s
complaint are “more than labels and conclusions” or “a formulaic
recitation of the elements of a cause of action.” Twombly, 550 U.S.
at 564, 127 S. Ct. 1955. We have no trouble finding that Fowler has
adequately pleaded a claim for relief under the standards announced
in Twombly and Iqbal, supra.
Id. at 212 (internal citation omitted) (second alteration in original).
The Third Circuit concluded that the district court had erred by relying on Conley in finding
that the plaintiff had insufficiently pleaded that she was disabled, and by relying on a case
(and the cases cited therein) that had disposed of claims either at the summary judgment
stage or at the judgment as a matter of law stage. Id. at 212–13. The court explained that
the standard at these later stages is much more rigid, while “‘[a] well-pleaded complaint may
proceed even if it strikes a savvy judge that actual proof of those facts alleged is improbable
and that a recovery is very remote and unlikely.’” Id. at 213 (quoting Twombly, 550 U.S.
at 556 (internal quotations omitted)). The court discussed the focus at the pleadings stage:
At this stage of the litigation, the District Court should have
focused on the appropriate threshold question—namely whether
Fowler pleaded she is an individual with a disability. The District
Court and UPMC instead focused on what Fowler can “prove,”
apparently maintaining that since she cannot prove she is disabled she
cannot sustain a prima facie failure-to-transfer claim.
A
determination whether a prima facie case has been made, however,
is an evidentiary inquiry—it defines the quantum of proof plaintiff
must present to create a rebuttable presumption of discrimination.
See Powell v. Ridge, 189 F.3d 387, 394 (3d Cir. 1999) (overruled on
other grounds). Even post-Twombly, it has been noted that a plaintiff
is not required to establish the elements of a prima facie case but
instead, need only put forth allegations that “raise a reasonable
expectation that discovery will reveal evidence of the necessary
element.” See Graff v. Subbiah Cardiology Associates, Ltd.[,] No.
08-207, 2008 WL 2312671 (W.D. Pa. June 4, 2008) [(]citing Phillips,
515 F.3d at 234[)]. Under the Federal Rules of Civil Procedure, an
64

evidentiary standard is not a proper measure of whether a complaint
fails to state a claim. Powell, 189 [F.3d] at 394.
Fowler, 578 F.3d at 213 (emphasis added). The Third Circuit emphasized that the plaintiff
was not required “at this early pleading stage, to go into particulars about the life activity
affected by her alleged disability or detail the nature of her substantial limitations.” Id.
Instead, the complaint was sufficient because it “identifie[d] an impairment, of which UPMC
allegedly was aware and allege[d] that such impairment constitute[d] a disability under the
Rehabilitation Act.” Id. The court found that the plaintiff’s “alleged limitation to sedentary
work plausibly suggest[ed] that she might be substantially limited in the major life activity
of working.” Id. (citations omitted). The court explained that the plaintiff would of course
ultimately have to prove that she was substantially limited in a major life activity, but that
at the pleadings stage, the allegation regarding disability was sufficient. Id. at 214 (citation
omitted). The court emphasized that “[t]his [wa]s so even after Twombly and Iqbal.” Id.12
•

Hodges v. Wilson, No. 08-4868, 2009 WL 2445114 (3d Cir. Aug. 11, 2009) (unpublished)
(per curiam). The plaintiff, an inmate at a prison run by the Pennsylvania Department of
Corrections (the “DOC”), filed a civil rights complaint under section 1983, asserting that
DOC employees violated his First, Eighth, and Fourteenth Amendment rights. Id. at *1. The
complaint alleged that the plaintiff originally had his own cell because he had “‘‘Z’ code’”
status, but that this status was revoked and the plaintiff then had to share a cell. Id. The
complaint also alleged that the plaintiff’s security status was elevated, which prevented him
from being eligible for certain jobs, and that the defendants changed his security status in
retaliation for the plaintiff stating that he intended to file a lawsuit. Id. The plaintiff claimed
that he suffered psychological and physical harm from sharing a cell and that his new cell
mate assaulted him. Id. The district court adopted the magistrate judge’s recommendation
to dismiss defendant Dr. Saavedra and to grant summary judgment in favor of the other
defendants. Id.

12

In a more recent case, the Third Circuit confirmed that the holdings of Twombly and Iqbal apply to employment
discrimination complaints. See Guirguis v. Movers Specialty Servs., Inc., No. 09-1104, 2009 WL 3041992, at *1 n.6
(3d Cir. Sept. 24, 2009) (unpublished) (“We have applied Twombly and Iqbal’s pleading requirements to employment
discrimination claims, but the quantum of facts that a discrimination complaint should contain must bear further
development.”) (internal citations omitted). The court did not resolve the facts needed for a discrimination complaint
because “[t]h[e] case . . . provide[d] a poor vehicle for that task because Guirguis relie[d] in large measure upon bare
legal conclusions that would likely have been insufficient even under the pre-Twombly pleading standard.” Id. (citing
Papasan v. Allain, 478 U.S. 265, 286 (1986) (“holding, prior to Twombly, that courts were not required to accept the truth
of legal conclusions contained in a plaintiff’s complaint”)). The court concluded that the allegations “that Guirguis is
an Egyptian native of Arab descent, that [the defendant] discharged him, and that his termination occurred in violation
of his civil rights,” were “certainly deficient in the post-Twombly era,” and that the last allegation was “precisely the type
of factually unsupported legal conclusion that is inadequate to surmount a Rule 12(b)(6) challenge.” Id. at *1 n.6, *2.
The court noted that “the complaint never intimate[d] in any way why Guirguis believe[d] that national origin motivated
[the termination].” Id. at *2. The court recognized that it had previously reassessed Swierkiewicz in Fowler, but noted
that “Swierkiewicz remains instructive because Guirguis’s complaint contain[ed] significantly less factual content than
the pleading at issue in that case . . . , bolstering [the court’s] conclusion that his claims would not have survived under
the pre-Twombly pleading regime.” Id. at *2 n.7.

65

With respect to Dr. Saavedra, the complaint alleged that he “‘supported’ the prison’s
decision to revoke [the plaintiff’s] ‘Z’ code status,” that his “male secretary impersonated
him during [the plaintiff’s] examinations[,] and that Dr. Saavedra allowed prison officials
to view [the plaintiff’s] medical records for the purpose of making a determination about [the
plaintiff’s] cell status.” Hodges, 2009 WL 2445114, at *2. The Third Circuit held that
“[a]bsent any assertion of attendant harm, Hodges’ allegation that an imposter stood in for
Dr. Saavedra d[id] not raise a federal claim,” noting that the plaintiff did “not allege that Dr.
Saavedra failed to provide treatment or disregarded a known risk of harm.” Id. (citations
omitted). With respect to the allegations that Dr. Saavedra conspired with the other
defendants to revoke the plaintiff’s “Z” code status and that he put the plaintiff at risk by
allowing others to access the plaintiff’s psychiatric records, the court found that the plaintiff
“fail[ed] to plead sufficient factual content to allow [it] to ‘draw the reasonable inference that
the defendant [wa]s liable for the misconduct alleged.’” Id. (quoting Iqbal, 129 S. Ct. at
1949). The court explained:
Hodges never states who was given access to his medical
information, nor does he allege that Dr. Saavedra’s actions put him
at risk of harm from the prison population. He does not specify what
harm he faced, other than the revocation of his “Z code” status. It is
apparent that his claim against Dr. Saavedra hinges upon his belief
that he has a liberty interest in being single-celled. As explained in
greater detail below, Hodges does not have a liberty interest in being
single-celled. As a result, he does not state a claim against Dr.
Saavedra.
Id. The court also affirmed the district court’s denial of the plaintiff’s motion for leave to
file an amended complaint and his motion to amend the complaint because the proposed
amendment to add a defendant and claim that the defendant “violated his rights by
permitting non-medical prison staff members to review his psychiatric records for the
purpose of reviewing his cell status” was “without merit for the same reasons . . . [explained]
with respect to Dr. Saavedra.” Id. at *1 n.3.
With respect to the other defendants, the plaintiff alleged that they violated the plaintiff’s
Fourteenth Amendment due process rights by revoking his “Z” code status and placing him
in a shared cell. Id. at *2. The court noted that “[i]t [wa]s well-settled that prisoners do not
have a due process right to be single-celled,” and “agree[d] with the District Court that
Hodges ha[d] not been subjected to atypical and significant hardship because his ‘Z’ code
status ha[d] been revoked and he must now share a cell.” Hodges, 2009 WL 2445114, at *2
(footnote omitted). The court also concluded that the allegations of an Eighth Amendment
violation were not supported, “agree[ing] with the District Court that Hodges’ complaints
of depression, paranoia, and physical discomfort d[id] not rise to the level of an Eighth
Amendment violation.” Id. at *3. The court also found that “[t]he single, two year-old
incident with [the plaintiff’s] cell mate that [the plaintiff] assert[ed] d[id] not establish that
66

prison officials ‘kn[e]w of and disregard[ed] an excessive risk to [his] health or safety.” Id.
(sixth, seventh, and eighth alterations in original). Finally, the Third Circuit agreed with the
district court’s grant of summary judgment on the plaintiff’s retaliation claim “[b]ecause the
uncontested evidence show[ed] that Hodges’ temporary placement in segregated housing and
the change in his work status were the result of his own misconduct . . . .” Id. The court
dismissed the appeal under 28 U.S.C. § 1915(c), denied the plaintiff’s motion for an
injunction to return him to a single cell, and denied the plaintiff’s motion for a return of legal
documents. Id. (footnote omitted).
•

Marangos v. Swett, No. 08-4146, 2009 WL 1803264 (3d Cir. Jun. 25, 2009) (unpublished)
(per curiam). The plaintiff sued his ex-wife, the state judge presiding over his divorce, and
a variety of financial institutions that participated in refinancing the plaintiff’s home
mortgage. Id. at *1. The plaintiff alleged that his ex-wife conspired with the state judge to
obtain favorable rulings in the divorce proceeding, and that she conspired with the
refinancing defendants to obtain the proceeds from the refinanced home. Id. The plaintiff
further alleged that “the refinancing defendants failed to inform him of a lis pendens [the
plaintiff’s ex-wife] had placed on the marital home before he signed a loan agreement for
refinancing, held the refinancing proceeds in escrow instead of giving the money to him, and
ultimately paid out the majority of the proceeds to [the ex-wife] and to the Child Support
Agency with no notice to him.” Id. The plaintiff alleged violations of § 1983, the Federal
Truth in Lending Act (TILA), and civil RICO. Id. The plaintiff also brought state law
claims against all defendants, alleging violations of New Jersey’s Unfair and Deceptive Acts
and Practices Act, intentional and/or negligent infliction of emotional distress, fraud,
deception, and violation of privacy laws, as well as “‘malicious abuse, misuse, and use of
process’” by his ex-wife and the judge. Id. Finally, the plaintiff alleged “‘Public Employee
Wrongfully Enforcing the Law’” and “‘Continuous Tort’” claims. Id. The district court
dismissed the claims against the judge as barred by absolute immunity, and dismissed the
remaining claims for failure to state a claim. The Third Circuit affirmed.
The Third Circuit found that the plaintiff failed to state a claim under § 1983 as to the title
company, the mortgagor, the loan servicer, and the ex-wife. Marangos, 2009 WL 1803264,
at *2. The court noted that there was no factual content in the complaint showing that the
loan servicer or the mortgager were involved in the divorce proceedings. Id. The only
relevant allegation was that the state judge made two phone calls in chambers during family
court hearings to the title company to confirm the amount held in escrow. Id. The court
concluded that “[v]iewing these allegations as true, the factual matter f[ell] far short of
permitting [the court] to infer a plausible connection among [the title company, the
mortgagor,] and/or [the loan servicer], all private corporations, and a governmental agency
or official such that their private actions would constitute ‘state action.’” Id. (footnote
omitted).
The Third Circuit also concluded that the facts in the complaint were not sufficient to allege
a plausible connection or conspiracy among the defendants to deprive him of his
constitutional rights under § 1983. Id. at *3 (citing Twombly, 550 U.S. at 556–57; Kost v.
67

Kozakiewicz, 1 F.3d 176, 185 (3d Cir. 1993)). The court also held that the claims that the
plaintiff’s ex-wife used the court system to ruin the plaintiff and that the state judge
unlawfully issued decisions in favor of the plaintiff’s ex-wife failed to state a claim. Id.
(citing Dennis v. Sparks, 449 U.S. 24, 28 (1980) (“noting that ‘merely resorting to the courts
and being on the winning side of a lawsuit does not make a party a co-conspirator or a joint
actor with the judge’”)).
To the extent that the plaintiff sought relief against the title company, the mortgagor, or the
loan servicer under TILA, the court concluded that “Marangos failed to state a claim for
relief that [wa]s plausible on its face” (even assuming the claims were not time-barred)
because TILA requires creditors to meaningfully disclose all credit terms to consumers in
order to avoid the uninformed use of credit, but Marangos did not allege that these
defendants failed to comply with the statute’s disclosure requirements. Marangos, 2009 WL
1803264, at *3.
The Third Circuit also found dismissal of the civil RICO claims appropriate because such
claims require “‘a pattern of racketeering activity that include[s] at least two racketeering
acts,’” and Marangos alleged theft and wire and mail fraud as predicate acts, but the theft
allegations did not constitute predicate acts under RICO, and the mail and wire fraud
allegations required pleading with particularity under Rule 9(b). See id. The court
emphasized that it did not need to accept legal conclusions couched as factual allegations as
true, giving this example from the complaint: “‘Defendants Swett, Land Options, and Judge
Guadagno, are involved in a cover-up and criminal and civil conspiracy to violate Plaintiff’s
Due Process and Equal Protection Rights, along with violating his fundamentally secured
Property Rights.’” Id. at *4. The court explained that this statement was “merely a
recitation of legal terms that enjoys no assumption of veracity.” Id. The court noted that the
complaint contained no facts to allow the court to reasonably infer, under Rule 9(b), that the
title company, the mortgagor, and the loan servicer engaged in wire or mail fraud. Id. The
court also noted that the complaint alleged that the judge spoke on the phone with the title
company and had ex parte communications with the ex-wife, but found that “[a]ssuming,
arguendo, that these allegations me[t] the standard of particularity required by Rule 9(b), and
assuming their veracity, [it] agree[d] with the District Court that they [we]re insufficient
under the less rigid pleading standard set forth in Rule 8(a)(2) to permit a plausible inference
of a scheme or an intent to defraud . . . .” Id.
•

Lopez v. Beard, No. 08-3699, 2009 WL 1705674 (3d Cir. Jun. 18, 2009) (unpublished) (per
curiam). The pro se plaintiff alleged that various officers in the Pennsylvania Department
of Corrections violated his rights under the ADA and the Eighth and Fourteenth
Amendments. Id. at *1. Specifically, the plaintiff alleged that he had HIV/AIDS, that the
prison officials and inmates knew this, that on one occasion his family was denied a contact
visit with him, that on another occasion his family was erroneously told that they were not
on the visitors list, and that individuals not named as defendants made disparaging
statements about the plaintiff’s medical condition. Id. The magistrate judge recommended
that the claims against four of the defendants be dismissed for failure to allege any personal
68

involvement; that the claims against the remaining defendants be dismissed because denial
of visitation did not rise to the level of a constitutional violation and the plaintiff had failed
to allege physical injury in connection with his emotional distress; and that the ADA claims
be dismissed for failure to allege any nexus between the denials of visitation and his
disability. Id. The district court allowed the plaintiff to file an amended complaint, in which
he alleged that he was deliberately denied contact with family members “‘in retaliation and
discrimination of plaintiff being HIV-AIDS positive and having a history of problems with
staff, including the filing of numerous complaints against staff.’” Id. at *2. “The only
specific claim [the plaintiff] made with respect to any individually-named defendant was that
Correctional Officer Alvarez made ‘belittling and discriminating remarks and gestures about
plaintiff to his then-girlfriend’ and altered his approved visitors list, thus preventing his sister
and brother-in-law from visiting him.” Id. The amended complaint also alleged that the
prison officials falsified their grievance response “to cover up their bad acts.” Id. The
district court dismissed the complaint, and the Third Circuit affirmed. The Third Circuit
explained:
What Lopez has alleged in his complaint and amended
complaints are theories and conclusions, not facts. While Lopez
claims that he has been subject to “prejudice, discrimination and
retaliation” at the hands of certain defendants, and that Officer
Alvarez made “belittling and discriminating remarks and gestures
about plaintiff to his then-girlfriend,” he does not offer any specifics
about these alleged incidents which would permit a court to reach the
conclusion that they were discriminatory. See Iqbal, 129 S. Ct. at
1952 (“He would need to allege more by way of factual content to
‘nudg[e]’ his claim of purposeful discrimination ‘across the line from
conceivable to plausible.’”). Accordingly, we agree that the District
Court properly dismissed his claims of violations of his rights under
the First, Eighth and Fourteenth Amendments of the U.S.
Constitution and Title II of the ADA for failure to state a claim.
Lopez, 2009 WL 1705674, at *3 (footnote omitted) (alteration in original).

Fourth Circuit
•
Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., --- F.3d ----, 2009 WL 5126224 (4th
Cir. Dec. 29, 2009). Defendant Consumeraffairs.com “operate[d] a website that allow[ed]
customers to comment on the quality of businesses, goods, and services.” Id. at *1. The
plaintiff was a company that sold or serviced cars and that received negative reviews on the
defendant’s website. See id. The plaintiff sued for defamation and tortious interference with
a business expectancy, and the defendant moved to dismiss on the basis of section 230 of the
Communications Decency Act of 1996 (the “CDA”), which “precludes plaintiffs from
holding interactive computer service providers liable for the publication of information
created and developed by others.” Id. (footnote and citations omitted). The district court
69

dismissed the complaint and granted leave to amend. Id. The defendant moved to dismiss
the amended complaint on the basis of section 230 of the CDA, and the district court granted
dismissal because “‘the allegations contained in the Amended Complaint [did] not
sufficiently set forth a claim asserting that [Consumeraffairs.com] authored the content at
issue,” and because “‘the allegations [we]re insufficient to take th[e] matter outside of the
protection of the Communications Decency Act.’” Id. (record citation omitted). The Fourth
Circuit affirmed.
Section 230 of the CDA “prohibits a ‘provider or user of an interactive computer service’
from being held responsible ‘as the publisher or speaker of any information provided by
another information content provider.’” Nemet, 2009 WL 5126224, at *2 (quoting 47 U.S.C.
§ 230(c)(1)). The court explained that “[a]ssuming a person meets the statutory definition
of an ‘interactive computer service provider,’ the scope of § 230 immunity turns on whether
the person’s actions also make it an ‘information content provider,’” which is defined as
“‘any person or entity that is responsible, in whole or in part, for the creation or development
of information provided through the Internet or any other interactive computer service.’”
Id. (quoting 47 U.S.C. § 230(f)(3)). The court explained that “[t]aken together, these
provisions bar state-law plaintiffs from holding interactive computer service providers
legally responsible for information created and developed by third parties.” Id. (citation
omitted). The court emphasized that it “aim[s] to resolve the question of § 230 immunity
at the earliest possible stage of the case because that immunity protects websites not only
from ‘ultimate liability,’ but also from ‘having to fight costly and protracted legal battles.’”
Id. (citation omitted). The plaintiff acknowledged that Consumeraffairs.com was an
interactive computer service provider, but argued that Consumeraffairs.com was also an
information content provider with respect to the twenty posts at issue in the litigation, and
therefore was not immune from liability under § 230. Id. at *3.
The Fourth Circuit noted that the district court had dismissed the complaint before Iqbal, but
that on appeal, the court was obligated to follow the law as it existed at the time of the
appeal. Id. at *3 n.5 (citation omitted). In examining the appropriate legal standard, the
Fourth Circuit noted that while “a court accepts all well-pled facts as true and construes
these facts in the light most favorable to the plaintiff,” it “conclude[d] from the analysis in
Iqbal that legal conclusions, elements of a cause of action, and bare assertions devoid of
further factual enhancement fail to constitute well-pled facts for Rule 12(b)(6) purposes.”
Nemet, 2009 WL 5126224, at *3 (citing Iqbal, 129 S. Ct. at 1949). The court framed the
issue before it: “We must determine, in a post-Iqbal context, whether the facts pled by
Nemet, as to the application of CDA immunity, make its claim that Consumeraffairs.com is
an information content provider merely possible or whether Nemet has nudged that claim
‘across the line from conceivable to plausible.’” Id. at *4 (quoting Iqbal, 129 S. Ct. at 1951).
The court explained the appropriate framework under Iqbal:
Following the example set by the Supreme Court in Iqbal we
begin our analysis by “identifying the allegations” of the amended
complaint that are either extraneous or “not entitled to the assumption
70

of truth.” 129 S. Ct. at 1951. We then proceed to determine the
plausibility of the factual allegations of Nemet’s amended complaint
pertaining to Consumeraffairs.com’s responsibility for the creation
or development of the comments at issue.
Id.
The complaint alleged in the “Development Paragraph”:
Upon information and belief, Defendant participated in the
preparation of this complaint by soliciting the complaint, steering the
complaint into a specific category designed to attract attention by
consumer class action lawyers, contacting the consumer to ask
questions about the complaint and to help her draft or revise her
complaint, and promising the consumer that she could obtain some
financial recovery by joining a class action lawsuit. Defendant is
therefore responsible, in whole or in part, for developing the
substance and content of the false complaint . . . about the Plaintiffs.
Id. (record citation and quotation marks omitted). The plaintiff argued that this paragraph
of its complaint “show[ed] Consumeraffairs.com’s culpability as an information content
provider either through (1) the ‘structure and design of its website,’ or (2) its participation
in ‘the preparation of’ consumer complaints: i.e., that Consumeraffairs.com ‘solict[ed]’ its
customers’ complaints, ‘steered’ them into ‘specific categor[ies] designed to attract attention
by consumer class action lawyers, contact[ed]’ customers to ask ‘questions about’ their
complaints and to ‘help’ them ‘draft or revise’ their complaints, and ‘promis[ed]’ customers
would ‘obtain some financial recovery by joining a class action lawsuit.’” Id. (record
citation omitted) (alterations in original).
The Fourth Circuit first analyzed the plaintiff’s argument that the structure and design of the
website prevented granting immunity to the defendant, explaining that “the facts pled . . .
d[id] not show Consumeraffairs.com developed the content of the posts by the structure and
design of its website.” Id. at *5. In contrast to a case relied on by the plaintiff, Fair Housing
Council v. Roommates.com, LLC, 521 F.3d 1157, 1174 (9th Cir. 2008), which involved a
website that “required users to input illegal content as a necessary condition of use,” the
court found that the plaintiff here had “merely alleged that Consumeraffairs.com structured
its website and its business operations to develop information related to class-action
lawsuits.” Nemet, 2009 WL 5126224, at *5. The court explained that “there [wa]s nothing
unlawful about developing this type of content; it [wa]s a legal undertaking: Federal Rule
of Civil Procedure 23, for instance, specifically provide[d] for class-action suits.” Id. The
court held: “Even accepting as true all of the facts Nemet pled as to Consumeraffairs.com’s
liability for the structure and design of its website, the amended complaint ‘d[id] not show,
or even intimate,’ that Consumeraffairs.com contributed to the allegedly fraudulent nature
of the comments at issue.” Id. (citing Iqbal, 129 S. Ct. at 1952). The court explained that
71

“as to these claimed facts in the Development Paragraph, Nemet’s pleading not only fail[ed]
to show it [wa]s plausible that Consumeraffairs.com [wa]s an information content provider,”
but it also failed to show “that it [wa]s even a likely possibility.” Id.
The court next analyzed the arguments that Consumeraffairs.com was “an information
content provider because it contacted ‘the consumer to ask questions about the complaint and
to help her draft or revise her complaint.’” Id. (record citation omitted). The court
concluded:
Nemet fails to make any cognizable argument as to how a website
operator who contacts a potential user with questions thus “develops”
or “creates” the website content. Assuming it to be true that
Consumeraffairs.com contacted the consumers to ask some unknown
question, this bare allegation proves nothing as to Nemet’s claim
Consumeraffairs.com is an information content provider.
Id. at *6. The court further held:
The remaining claim, of revising or redrafting the consumer
complaint, fares no better.
Nemet has not pled what
Consumeraffairs.com ostensibly revised or redrafted or how such
affected the post. “Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not suffice.”
Iqbal, 129 S. Ct. at 1949. Nemet’s claim of revising or redrafting is
both threadbare and conclusory.
Nemet, 2009 WL 5126224, at *6. The court noted:
Moreover, in view of our decision in Zeran [v. Am. Online,
Inc., 129 F.3d 327, 330 (4th Cir. 1997)], Nemet was required to plead
facts to show any alleged drafting or revision by
Consumeraffairs.com was something more than a website operator
performs as part of its traditional editorial function. See 129 F.3d at
330. It has failed to plead any such facts. “Congress enacted § 230’s
broad immunity ‘to remove disincentives for the development and
utilization of blocking and filtering technologies that empower
parents to restrict their children’s access to objectionable or
inappropriate online material.’ 47 U.S.C. § 230(b)(4). In line with
this purpose, § 230 forbids the imposition of publisher liability on a
service provider for the exercise of its editorial and self-regulatory
functions.” Id. at 331.
We thus conclude that the Development Paragraph failed, as
a matter of law, to state facts upon which it could be concluded that
72

it was plausible that Consumeraffairs.com was an information content
provider. Accordingly as to the Development Paragraph, the district
court did not err in granting the Rule 12(b)(6) motion to dismiss
because Nemet failed to plead facts sufficient to show
Consumeraffairs.com was an information content provider and not
covered by CDA immunity.
Id.
The plaintiff argued that even if the Development Paragraph was insufficient to allow the
case to proceed, “as to eight of the twenty posts, the amended complaint pled other facts
which show[ed] Consumeraffairs.com [wa]s an information content provider.” Id. With
respect to these eight posts, “Nemet pled as to each that ‘[b]ased upon the information
provided in the post, [Nemet] could not determine which customer, if any, this post pertained
to.’” Id. (record citation omitted) (alterations in original). The complaint alleged in the
“Fabrication Paragraph”:
“Because Plaintiffs cannot confirm that the [customer] complaint . .
. was even created by a Nemet Motors Customer based on the date,
model of car, and first name, Plaintiffs believe that the complaint . .
. was fabricated by the Defendant for the purpose of attracting other
consumer complaints. By authoring the complaint . . . the Defendant
was therefore responsible for the substance and content of the
complaint.”
Id. at *7 (footnote omitted) (alteration in original). The Fourth Circuit noted that “Nemet’s
sole factual basis for the claim that Consumeraffairs.com [wa]s the author, and thus an
information content provider not entitled to CDA immunity, [wa]s that Nemet [could not]
find the customer in its records based on the information in the post.” Id. The court
explained:
Because Nemet was unable to identify the authors of these
comments based on “the date, model of car, and first name” recorded
online, Nemet alleges that these comments were “fabricated” by
Consumeraffairs.com “for the purpose of attracting other consumer
complaints.” But this is pure speculation and a conclusory allegation
of an element of the immunity claim (“creation . . . of information”).
47 U.S.C. § 230(f)(3). Nemet has not pled that Consumeraffairs.com
created the allegedly defamatory eight posts based on any tangible
fact, but solely because it (Nemet) can’t find a similar name or
vehicle of the time period in Nemet’s business records. Of course,
the post could be anonymous, falsified by the consumer, or simply
missed by Nemet. There is nothing but Nemet’s speculation which
pleads Consumeraffairs.com’s role as an actual author in the
73

Fabrication Paragraph.
Nemet, 2009 WL 5126224, at *7 (internal citation omitted). The court also rejected the
plaintiff’s argument that supporting allegations “show[ed] [that] the Fabrication Paragraph
plead[ed] adequate facts that Consumeraffairs.com [wa]s the author of the eight posts.” Id.
The court explained:
These allegations include (1) that Nemet has an excellent
professional reputation, (2) none of the consumer complaints at issue
have been reported to or acted upon by the New York City
Department of Consumer Affairs, (3) Consumeraffairs.com’s sole
source of income is advertising and this advertising is tied to its
webpage content, and (4) some of the posts on
Consumeraffairs.com’s website appeared online after their listed
creation date. Nemet’s allegations in this regard do not allow us to
draw any reasonable inferences that would aid the sufficiency of its
amended complaint.
That Nemet may have an overall excellent professional
reputation, earned in part from a paucity of complaints reported to
New York City’s Department of Consumer Affairs, does not allow us
to reasonably infer that the particular instances of consumer
dissatisfaction alleged on Consumeraffairs.com’s website are false.
Furthermore, Nemet’s allegations in regard to the source of
Consumeraffairs.com’s revenue stream are irrelevant, as we have
already established that Consumeraffairs.com’s development of
class-action lawsuits does not render it an information content
provider with respect to the allegedly defamatory content of the posts
at issue. Finally, the fact that some of these comments appeared on
Consumeraffairs.com’s website after their listed creation date does
not reasonably suggest that they were fabricated by
Consumeraffairs.com. Any number of reasons could cause such a
delay, including Consumeraffairs.com’s review for inappropriate
content. See Iqbal, 129 S. Ct. at 1951.
We are thus left with bare assertions “devoid of further factual
enhancement,” which are not entitled to an assumption of truth. Id.
at 1949. Such conclusory statements are insufficient as a matter of
law to demonstrate Nemet’s entitlement to relief. See id. As recently
emphasized by the Supreme Court, Rule 8 requires “more than
conclusions” to “unlock the doors of discovery for a plaintiff.” Id. at
1950. Viewed in the correct “factual context,” id. at 1954, Nemet’s
stark allegations are nothing more than a “formulaic recitation” of
one of the elements of its claims. Id. at 1951. A plaintiff must offer
74

more than “[t]hreadbare recitals of the elements of a cause of action”
and “conclusory statements,” however, to show its entitlement to
relief. Id. at 1949.
Id. at *7–8 (footnote omitted) (alteration in original). The court noted that the amended
complaint contained allegations regarding several comments made by Consumeraffairs.com
on its website, in which it provided commentary on the other posts, but stated that “[b]ecause
Nemet failed to argue in its opening brief that these comments contributed to the sufficiency
of its amended complaint, [the court] would not consider them in th[e] appeal.” Id. at *8 n.7.
The court concluded:
Viewed in their best light, Nemet’s well-pled allegations
allow us to infer no more than “the mere possibility” that
Consumeraffairs.com was responsible for the creation or
development of the allegedly defamatory content at issue. Nemet has
thus failed to nudge its claims that Consumeraffairs.com is an
information content provider for any of the twenty posts across the
line from the “conceivable to plausible.”
As a result,
Consumeraffairs.com is entitled to § 230 immunity and the district
court did not err by granting the motion to dismiss.
Id. at *8 (internal citations omitted).
Judge Jones filed a separate opinion, concurring in part and dissenting in part. Judge Jones
agreed that the complaint was insufficient with respect to the twelve posts that the plaintiff
connected to its customers because “[t]he facts alleged d[id] not show that as to these posts
it [wa]s plausible that Consumeraffairs.com [wa]s an information content provider within
the meaning of th Communications Decency Act.” Id. at *8 (Jones, J., concurring in part and
dissenting in part). But with respect to the other eight posts, Judge Jones disagreed with the
majority’s conclusion, stating that “the allegations of the Amended Complaint adequately
set forth a claim that Consumeraffairs.com was responsible for the eight posts from fictitious
customers.” Nemet, 2009 WL 5126224, at *9 (Jones, J., concurring in part and dissenting
in part). Judge Jones stated:
In the first place, we are required to accept as true, at least at
this stage of the case, Nemet’s allegation that these eight posts did
not represent real customers. Nemet alleged that it documented each
vehicle sale with forms that give the customer’s full name, address,
description of the vehicle sold, and the date of sale, as well as other
information. Each of the eight posts described in the Amended
Complaint gave the first name and hometown of the putative
customer as well as the make and model of the vehicle sold by
Nemet. All of the posts were dated and all but one set forth the
75

alleged date of the sale. In spite of Nemet’s careful documentation
of each sale and comparison with the information provided in the
posts, Nemet was unable to connect any of these posted complaints
with a real transaction.
Moreover, these were not the sole pertinent factual
allegations. Nemet also alleged the following in its Amended
Complaint:
(1) The eight complaints at issue were never reported to the New
York City Department of Consumer Affairs, which, according to
Nemet, is responsible for policing consumer issues where Nemet
does business, and which has recently pursued highly publicized
consumer litigation against other car dealers. (Am. Compl. ¶¶ 12-14,
J.A. 49.);
(2) Consumeraffairs.com’s website encourages consumers to
complete complaint forms, but the website does not contain a place
for positive reviews. (Am. Compl. ¶ 28, J.A. 53.);
(3) The website “entices visitors with the possibility of participating
in a class-action lawsuit, with the potential for a monetary recovery,”
by promising to have “class action attorneys” review all submitted
complaints. (Am. Compl. ¶ 29, J.A. 53.);
(4) Consumeraffairs.com earns revenue by selling ads tied to its
webpage content, including the content posted by consumers. (Am.
Compl. ¶¶ 21, 22, J.A. 51.);
(5) Consumeraffairs.com wrote derogatory statements about Nemet
on the website in connection with the alleged consumer complaints
....
Id. Judge Jones thought these allegations were sufficient under Iqbal:
While Twombly and Iqbal announced a new, stricter pleading
standard, they did not merge the pleading requirements of Rule 8
with the burden of proof required for summary judgment. In fact, the
Court in Twombly stated that “[a]sking for plausible grounds to infer”
a claim’s existence “does not impose a probability requirement at the
pleading stage.” Twombly, 550 U.S. at 556. The plausibility
standard “simply calls for enough fact to raise a reasonable
expectation that discovery” will lead to information supporting the
plaintiff’s claim. Id. Nemet’s pleading accomplishes this. By stating
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sufficient factual assertions, Nemet has created the reasonable
inference that Consumeraffairs.com wrote the eight posts to attract
additional complaints.
It is true that there may be alternative explanations for these
posts that show that they are not attributable to Consumeraffairs.com.
Nemet may have simply overlooked eight actual customers in its
review of the company sales documents. The fictitious posts may
have come from mischief makers unrelated to Consumeraffairs.com,
or from real consumers who wished to remain anonymous by
falsifying the details of their transactions. But I don’t believe that
any of these alternatives are any more plausible than Nemet’s claim.
It cannot be the rule that the existence of any other plausible
explanation that points away from liability bars the claim. Otherwise,
there would be few cases that could make it past the pleading stage.
Indeed, as Iqbal teaches, it is only where there are “more likely
explanations” for the result that the plausibility of the claim is
justifiably suspect. Iqbal, 129 S. Ct. at 1951.
While the present federal pleading regime is a significant
change from the past, it remains true that a plaintiff in federal court
need not allege in its initial pleading all of the facts that will allow it
to obtain relief. Otherwise, the summary judgment process under
Rule 56 would have little meaning. Of course, I don’t know whether
Nemet could have ultimately prevailed on its claim that
Consumeraffairs.com made up the eight posts in question, or even if
it could have withstood a motion for summary judgment, but under
the circumstances it ought to have been allowed to attempt to prove
its case.
Id. at *10 (emphasis added) (alteration in original).
•

Francis v. Giacomelli, --- F.3d ----, 2009 WL 4348830 (4th Cir. Dec. 2, 2009). The mayor
of Baltimore, Martin O’Malley, terminated the employment of the city’s police
commissioner, Kevin Clark, as well as two of Clark’s deputies, Joel Francis and Anthony
Romano. Id. at *1. O’Malley and City Solicitor Ralph Tyler sent members of the police
department to Clark’s offices to retrieve Clark’s, Francis’s, and Romano’s “badges, police
identifications, firearms, computers, and other official property, and to escort them from the
building.” Id. Clark sued O’Malley and the City Council in state court, seeking
reinstatement and damages based on violation of the city’s laws and breach of contract. Id.
“The Maryland Court of Appeals ultimately concluded that, despite Commissioner Clark’s
contract with the Mayor and City Council of Baltimore, which authorized the Mayor to
discharge the Commissioner without cause, Clark had not been discharged in accordance
77

with Baltimore City Public Local Law, which required cause.” Id. Clark and his deputies
also sued in federal court, “alleging that the Mayor, the City Solicitor, and several members
of the Baltimore City Police Department violated their constitutional rights by seizing
property from the Commissioner and his deputies and by seizing them and removing them
from Police Department offices.” Id. The complaint alleged “that the plaintiffs’ Fourth and
Fourteenth Amendment rights were violated insofar as the searches of the plaintiffs’ offices
and the seizures of the plaintiffs and their personal property were not justified by any
criminal charges or any warrant and were, therefore, unreasonable.” Francis, 2009 WL
4348830, at *3. In the second count, “Clark and Francis, who are African-American,
claim[ed] conclusorily that they were removed from their offices and terminated from their
positions because of their race, in violation of 42 U.S.C. § 1981.” Id. In Count III, the
plaintiffs alleged “that they were denied due process insofar as their employment was
terminated without prior notice and a prior hearing,” and “in Count IV, the plaintiffs
allege[d] conclusorily that the defendants conspired to violate their civil rights based on the
acts otherwise alleged, in violation of 42 U.S.C. § 1985.” Id. The district court dismissed
because the complaint did not state plausible claims for relief and because the Mayor was
entitled to qualified immunity with respect to Clark’s allegation that the Mayor denied him
due process. Id. at *1. The Fourth Circuit affirmed.
On appeal, the plaintiffs argued that a motion to dismiss “must be denied unless ‘‘it is clear
that no relief could be granted under any set of facts that could be proved consistent with the
[well-pleaded] allegations’ in the Complaint,’” id. at *3 (quoting Swierkiewicz v. Sorema,
N.A., 534 U.S. 506, 514 (2002)) (alteration in original), but the court noted that “[t]he
standard that the plaintiffs quoted from Swierkiewicz . . . was explicitly overruled in
Twombly,” id. at *3 n.1. The plaintiffs also argued that “it was error to dismiss a complaint
alleging civil rights violations unless it appear[ed] ‘to a certainty that the plaintiff[s] would
not be entitled to relief under any legal theory which might plausibly be suggested by the
facts alleged.’” Francis, 2009 WL 4348830, at *3 (quoting Veney v. Wyche, 293 F.3d 726,
730 (4th Cir. 2002)) (second alteration in original).
In discussing the appropriate legal framework, the Fourth Circuit explained that providing
notice to the defendant is only one of the many purposes of adequate pleadings:
Even though the requirements for pleading a proper complaint
are substantially aimed at assuring that the defendant be given
adequate notice of the nature of a claim being made against him, they
also provide criteria for defining issues for trial and for early
disposition of inappropriate complaints. See 5 CHARLES ALAN
WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND
PROCEDURE, § 1202, at 88 (3d ed. 2004). Overlooking the broad
range of criteria stated in the Federal Rules for a proper complaint,
some have suggested that the Federal Rules, when adopted in 1938,
simply created a “notice pleading” scheme, pointing for support to
Rule 8(a)(2), which requires only “a short and plain statement of the
78

claim showing that the pleader is entitled to relief,” and Rule 8(d)(1),
which provides that “[n]o technical form [for stating allegations] is
required.” But the “notice pleading” characterization may itself be
too simplistic, failing to recognize the many other provisions
imposing requirements that permit courts to evaluate a complaint for
sufficiency early in the process. Rule 8 itself requires a showing of
entitlement to relief. Rule 9 requires that allegations of fraud,
mistake, time, place, and special damages be specific. Rule 11
requires that the pleading be signed and provides that the signature
“certifies” (1) that the claims in the complaint are not asserted for
collateral purposes; (2) that the claims asserted are “warranted”; and
(3) that the factual contentions “have evidentiary support.” And Rule
12(b)(6) authorizes a court to dismiss any complaint that does not
state a claim “upon which relief can be granted.” The aggregation of
these specific requirements reveals the countervailing policy that
plaintiffs may proceed into the litigation process only when their
complaints are justified by both law and fact.
Id. at *4 (first and third emphasis added) (alterations in original). The court noted that “[i]n
recent years, with the recognized problems created by ‘strike suits,’13 and the high costs of
frivolous litigation, the Supreme Court ha[d] brought to the forefront the Federal Rules’
requirements that permit courts to evaluate complaints early in the process.” Id. (internal
citation to 5A WRIGHT & MILLER, FEDERAL PRACTICE AND PROCEDURE § 1296, at 46 & n.9
omitted).
In evaluating Count I, the Fourth Circuit noted that the complaint “allege[d] that members
of the Baltimore City Police Department, under the direction of Mayor O’Malley and City
Solicitor Tyler, ‘broke into and entered’ the Police Commissioner’s offices, seized personal
property, and ‘detained, held in custody and seized’ the Police Commissioner and his
deputies while ordering them to ‘surrender their weapons, badges, identification cards’ and
similar property—all without the benefit of criminal charges or a warrant,” in violation of
the plaintiffs’ Fourth and Fourteenth Amendment rights. Id. at *5. The court found that no
plausible claim had been stated, explaining:
While the Commissioner and his deputies conclusorily alleged that
the searches and seizures violated their constitutional rights because
no charges had been filed against them, nor had any warrant issued,
their complaint did not allege that the defendants were engaged in a
law-enforcement effort. Indeed, the facts show to the contrary, that
the defendants’ actions against the plaintiffs were employment

13

The court explained that “[a] ‘strike suit’ is an action making largely groundless claims to justify conducting extensive
and costly discovery with the hope of forcing the defendant to settle at a premium to avoid the costs of the discovery.”
Francis, 2009 WL 4348830, at *4 n.2 (citations omitted).

79

actions based on the Mayor’s perceived right to fire the Police
Commissioner without cause, as stated in the Memorandum of
Understanding between Commissioner Clark and Baltimore City.
....
The plaintiffs’ complaint relies on the allegations that no criminal
charges had been filed and no warrant had issued in order to state a
violation of the Fourth Amendment. But this assertion is both
conclusory and erroneous, especially when the complaint itself does
not allege that the searches and seizures were law-enforcement
related. On the contrary, the complaint suggests throughout that the
searches and seizures were taken in furtherance of Mayor O’Malley’s
employment action of firing Commissioner Clark.14
Id. The court noted that “[t]he plaintiffs allege[d] nowhere that these actions were
inconsistent with the Mayor’s efforts to terminate the plaintiffs’ employment,” and that “it
is common practice for an employer to take the employer’s property away from discharged
employees and to deny them access to the place of employment.” Id. The court further
noted that while the City had an interest in protecting the police department’s property and
in removing discharged employees, “the complaint fail[ed] to allege any countervailing
privacy interests that would outweigh the City’s interests,” and instead “relie[d] simply on
the absence of any charges or any warrant, which [wa]s irrelevant in the factual context of
th[e] complaint.” Francis, 2009 WL 4348830, at *6. The court also concluded that the fact
that the state court of appeals had found that the firing was inconsistent with Baltimore’s
local laws did “not alone support the claim that the searches and seizures conducted in
connection with the Mayor’s effort to terminate Clark’s employment violated the Fourth
Amendment.” Id. at *7.
In support of the discrimination claim under section 1981, “the only factual allegations
asserted . . . [we]re (1) that Commissioner Clark and Deputy Francis are African-American
males; (2) that the defendants are all white males; and (3) that the defendants ha[d] never
initiated or undertaken the actions of terminating employment and physically removing the
employee against white members of the Police Department.” Id. The Fourth Circuit found
that “[t]hese allegations [we]re not only conclusory and insufficient to state a § 1981 claim,
see Jordan [v. Alternative Resources Corp., 458 F.3d 332, 345 (4th Cir. 2006)], they [we]re
patently untrue, given that Deputy Romano, who [wa]s not alleged to be within a protected
class, complained of the exact same treatment in every other count of the complaint, belying
any claim of discriminatory treatment.” Id. (footnote omitted). The court held that “[t]he
allegations in this count [we]re nothing more than the sort of unadorned allegations of
wrongdoing to which Twombly and Iqbal [we]re directed,” and that “Count II d[id] not on

14

The court seemed to rely on the fact that the law did not provide relief for the conduct alleged, rather than a lack of
factually specific details.

80

its face state a plausible claim for relief.” Id.
With respect to the claim that the plaintiffs’ due process rights were violated, the Fourth
Circuit agreed with the district court that qualified immunity applied, because even though
the state court later determined that the contract “was subservient to the requirements of the
Public Local Law of Baltimore City, at the time that Mayor O’Malley fired Commissioner
Clark, no law or decision had determined that the contract between Clark and the City of
Baltimore was not enforceable.” Id. at *8.
With respect to the fourth count, the complaint “allege[d] that the defendants conspired to
violate the plaintiffs’ civil rights, in violation of 42 U.S.C. § 1985,” but made “no other
allegations and contain[ed] no facts to support the conspiracy alleged.” Francis, 2009 WL
4348830, at *8. The court cited pre-Twombly case law to note that pleading a violation of
section 1985 requires “demonstrat[ing] with specific facts that the defendants were
‘motivated by a specific class-based, invidiously discriminatory animus to [ ] deprive the
plaintiff[s] of the equal enjoyment of rights secured by the law to all.’” Id. (quoting
Simmons v. Poe, 47 F.3d 1370, 1376 (4th Cir. 1995)) (second and third alterations in
original). The court held: “Since the allegation in Count IV amounts to no more than a legal
conclusion, on its face it fails to assert a plausible claim.” Id. (citing Iqbal, 129 S. Ct. at
1950; Gooden v. Howard County, Md., 954 F.2d 960, 969–70 (4th Cir. 1992) (en banc)).
Finally, with respect to the argument that the district court erred in denying leave to amend,
the Fourth Circuit noted that although the plaintiffs concluded their opposition to the motion
to dismiss by stating that if the motion was granted, the plaintiffs requested leave to amend
or to file an amended complaint, they “filed no separate motion, and they attached no
proposed amendment or statement indicating how they might wish to amend their
complaint.” Id. at *9. The plaintiffs had violated a local district court rule which required
a party requesting leave to amend to provide a copy of the proposed amendment, and the
Fourth Circuit held that “[i]n the circumstances, . . . the district court did not abuse its
discretion in failing to give the plaintiffs a blank authorization to ‘do over’ their complaint.”
Id.
•

Monroe v. City of Charlottesville, 579 F.3d 380 (4th Cir. 2009). The plaintiff sued the city
and individual police officers under § 1983, alleging violations of the Fourth and Fourteenth
Amendments, because he was approached at his home by a police officer and asked to give
a DNA sample because he matched the description of a serial rapist given by victims who
described their assailant as “a youthful-looking black male.” Id. at 382. The plaintiff
alleged that his equal protection rights were violated because he was stopped based on his
race, and because officers did not perform similar stops when victims describe an assailant
as white. Id. The plaintiff also alleged that he was subject to an unreasonable seizure when
the officer came to his home and when the plaintiff gave a sample for DNA analysis. Id.
The district court concluded that the plaintiff could not proceed on his equal protection claim
based on being stopped on account of his race because the Equal Protection Clause is not
violated when the police limit their investigation to those matching a victim’s description,
81

but found that the plaintiff could proceed on the claim that the City did not investigate
crimes in the same way when the assailant is described as white. Id. at 382–83. The district
court dismissed the seizure claim based on the officer coming to the plaintiff’s home because
“Monroe failed to state facts sufficient to show the consensual encounter escalated to a
seizure,” but his claim that his bodily fluids were unreasonably seized was allowed to
proceed. Id. at 383. The plaintiff amended his complaint, and the defendant again moved
to dismiss. The district court again dismissed the portion of the equal protection claim
asserting that the officers only approached him based on his race, but allowed the rest of the
equal protection claim to proceed; dismissed the claim that the plaintiff was unreasonably
seized because “the newly alleged facts did not cure the original deficiencies”; and allowed
the seizure claim based on the officer’s taking bodily fluids to proceed. Monroe, 579 F.3d
at 383. The plaintiff appealed the dismissal of his Fourth Amendment claim and the
dismissal of his equal protection claim; the Fourth Circuit affirmed.
On appeal, the plaintiff asserted that the district court improperly “required him to plead
facts sufficient to prove his claim, instead of merely requiring ‘enough facts from which the
trial court could infer a basis for [Monroe’s] claim’ when viewed in conjunction with the
potentially discoverable facts . . . .” Id. at 385 (alteration in original). Citing a pre-Twombly
case, the Fourth Circuit noted that “the court ‘need not accept legal conclusions drawn from
the facts, and [ ] need not accept as true unwarranted inferences, unreasonable conclusions,
or arguments.’” Id. at 385–86 (quoting Jordan v. Alternative Res. Corp., 458 F.3d 332, 338
(4th Cir. 2006)) (alteration in original).
With respect to the seizure claim, the court noted that the plaintiff had alleged that “he ‘was
visited in his home and coerced into giving a DNA sample’”; “[t]he encounter was not
consensual because ‘Monroe had both an objectively and subjectively reasonable belief that
he was not free to decline the officer’s request or otherwise terminate the encounter”; “[t]he
officer was in uniform and did not tell Monroe that he could termination the encounter”;
“[t]he encounter was at Monroe’s home and he was concerned neighbors would view him
‘as a snitch’”; “Monroe, based on his and others’ interactions with police, believed he had
to comply with the officers, and the fact that he was approached at his home meant he ‘was
not free to terminate the interaction’”; and “Monroe’s belief that he could not terminate the
encounter was objectively reasonable based on ‘[t]he state of relations between law
enforcement and members of the minority communities.’” Id. at 386 (fourth alteration in
original). The Fourth Circuit noted that “[t]o elevate . . . an encounter to a seizure, a
reasonable person must feel he is not free to disregard the officer and terminate the
encounter,” and that because the inquiry is an objective one, the plaintiff’s subjective beliefs
were irrelevant. Id. The court rejected the plaintiff’s theory that it was enough to plead that
a sufficient proportion of the population shared his beliefs, stating that “[t]o agree that
Monroe’s subjective belief that he was not free to terminate the encounter was objectively
reasonable because relations between police and minorities are poor would result in a rule
that all encounters between police and minorities are seizures.” Id. at 386–87. The court
concluded that “while Monroe’s subjective beliefs may be facts, they are irrelevant facts that
neither plausibly give rise to a right to relief nor suggest there are discoverable facts that may
82

plausibly give rise to a right to relief.” Monroe, 579 F.3d at 387. The court found that the
remaining allegations in the complaint did not meet the Twombly standard:
The remaining facts in the complaint regarding the alleged
seizure do not satisfy the Twombly test either. First, Officer
Mooney’s failure to tell Monroe that he could terminate the encounter
has been rejected as a means of establishing a seizure, and does not
imply there are discoverable facts that establish otherwise. Second,
the allegations that Monroe was “coerced,” that his belief was
“objectively reasonable,” and that the encounter “was not [ ]
consensual” are legal conclusions, not facts, and are insufficient. The
remaining two facts—that Officer Mooney was in uniform and he
approached Monroe at his home—merely describe many consensual
encounters, are insufficient to survive a Rule 12(b)(6) motion, and do
not imply there are other discoverable facts that “raise a right to relief
above the speculative level.” Twombly, 550 U.S. at 555, 127 S. Ct.
1955. Thus, the district court did not err in dismissing Monroe’s
Fourth Amendment claim.
Id. (internal citations omitted) (alteration in original).
With respect to the equal protection claim, the Fourth Circuit concluded that the officer did
not approach the plaintiff based on his race, but based on the victims’ descriptions. The
court noted that an equal protection claim requires “‘express racial classification,’ which
occurs when the government distinguishes among the citizenry on the basis of race,” and
concluded that “it [wa]s clear that the officers in this case made no such distinction when
establishing the suspect’s characteristics—any descriptive categorization came from the rape
victims who described their assailant.” Id. at 388. The court found this conclusion
supported by Iqbal, where the Supreme Court “noted that Arab-Muslim men were
responsible for the September 11 attacks, and ‘[i]t should come as no surprise that a
legitimate policy directing law enforcement to arrest and detain individuals because of their
suspected link to the attacks would produce a disparate, incidental impact on Arab Muslims
. . . .’” Id. at 389 (quoting Iqbal, 129 S. Ct. at 1951) (alteration in original).
•

Walker v. Prince George’s County, 575 F.3d 426 (4th Cir. 2009). The owners of a pet wolf
initiated suit in state court against the county animal control officer and the county after the
officer seized their pet wolf. The plaintiffs alleged civil trespass, violation of the Maryland
Constitution, and violation of their Fourth Amendment rights under § 1983. Id. at 428. The
defendants removed the case to federal court and moved for summary judgment. Id. The
district court granted the defendants’ motion for summary judgment because the officer was
entitled to qualified immunity and the complaint failed to adequately plead a claim against
the county under Monell v. New York City Department of Social Services, 436 U.S. 658
(1978), by failing to allege the county’s policy, custom, or practice. Walker, 575 F.3d at
428. The plaintiffs appealed the grant of the defendants’ motion for summary judgment on
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the Fourth Amendment § 1983 claim and the denial of their own motion for summary
judgment on that claim, and also argued that they were entitled to summary judgment. Id.
at 428–29. The Fourth Circuit affirmed.
In discussing the Monell claim, the Fourth Circuit noted that “a municipality’s liability
‘arises only where the constitutionally offensive actions of employees are taken in
furtherance of some municipal ‘policy or custom,’” id. at 431 (citation omitted), but that the
plaintiffs “‘failed to make any allegations in their complaint in regards to the existence of
the County’s policy, custom, or practice, therefore failing to plead’ a viable Monell claim,”
id. (citation omitted). The court rejected the plaintiffs’ assertion that “a County policy to
seize animals without inquiring whether their owners have valid permits for those animals
‘[could] be inferred from Officer Jacobs’ testimony’ and that it should be ‘presumed that the
County never checks to see if owners lawfully possess wild or exotic animals before seizing
them,’” because the plaintiffs “fail to explain the basis of their inference or the justification
for their presumption.” Id. The court noted: “Critically lacking is any support for the
proposition that Officer Jacobs’ common practice ‘implemented an official government
policy or custom.’” Id. (citation omitted). The court concluded that the allegations “‘d[id]
not permit [it] to infer more than the mere possibility of misconduct,” Walker, 575 F.3d at
431 (citing Iqbal, 129 S. Ct. at 1950), and “[t]his mere possibility [wa]s inadequate to subject
the County to appellants’ suit for monetary damages,” id.
•

Shonk v. Fountain Power Boats, 338 F. App’x 282 (4th Cir. 2009) (unpublished) (per
curiam). The plaintiff brought a breach of warranty case based on defects in a boat he
purchased. Id. at 283. The plaintiff sued Fountain Power Boats (“Fountain”), the
manufacturer of the boat; Yanmar American Corporation (“Yanmar”), the manufacturer of
the boat’s engines; and Mercury Marine (“Mercury”), the manufacturer of the boat’s stern
drives. Id. The complaint asserted breach of warranty under the Magnuson-Moss
Warranty–Federal Trade Commission Improvement Act (the “MMWA”), breach of warranty
under the Maryland Uniform Commercial Code–Sales (the “Maryland UCC”), and unfair
or deceptive trade practices under the Maryland Consumer Protection Act (the “Maryland
CPA”). Id. The district court granted dismissal under Rule 12(b)(6) of the claims against
Yanmar and Mercury, denied leave to amend, and granted summary judgment in favor of
Fountain on the MMWA claim. Id. at 284.
The complaint alleged one count under the MMWA, one count under the Maryland UCC,
and one count under the Maryland CPA, and each count “indiscriminately used the term
‘Defendant.’” Id. After the district court had dismissed the claims against Yanmar and
Mercury, the plaintiff sought to file a Second Amended Complaint, which “newly alleged
that Fountain manufactured the Boat, Yanmar manufactured the Boat’s engines, and
Mercury manufactured the Boat’s stern drives”; “listed Shonk’s claims under the MMWA
against Fountain, Yanmar, and Mercury in separate counts”; and left the remaining claims
“lumped together.” Shonk, 338 F. App’x at 285. In the proposed Second Amended
Complaint, “Shonk’s claims against Yanmar and Mercury under the MMWA, the Maryland
CPA, and the Maryland UCC continued to focus solely upon the Boat.” Id. The district
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court overturned the magistrate judge’s decision to allow filing of the Second Amended
Complaint, finding, among other things, that amendment would be futile. Id.
With respect to the claims against Yanmar and Mercury under the MMWA, the district court
had dismissed “because the Initial Complaint failed to identify a consumer product supplied
or manufactured by Yanmar or Mercury.” Id. at 287. The plaintiff argued on appeal that
“‘when a specific boat is identified, Yanmar and Mercury should be able to determine what
role they played in the manufacture of the specific boat by tracing a serial number or
otherwise.’” Id. The Fourth Circuit rejected this argument:
Shonk’s contention is fatally flawed in two respects. First, it
ignores his burden at the Rule 12(b)(6) stage to allege sufficient
factual matter “to raise a right to relief above the speculative level .
. . .” Twombly, 550 U.S. at 555, 127 S. Ct. 1955. At best, Shonk’s
allegations in the Initial Complaint pertaining to his claims under the
MMWA against Yanmar and Mercury constitute “[t]hreadbare
recitals of the elements of a cause of action, supported by mere
conclusory statements,” which decisively fail to meet his pleading
burden. Iqbal, 129 S. Ct. at 1940. Second, Shonk’s contention
ignores Rule 10(b)’s mandate to state, in a separate count, each claim
founded on a separate transaction or occurrence, “[i]f doing so would
promote clarity.” FED. R. CIV. P. 10(b). Given the fact that Fountain
manufactured the Boat, Yanmar manufactured the Boat’s engines,
and Mercury manufactured the Boat’s stern drives, each claim under
the MMWA against Fountain, Yanmar, and Mercury should have
been stated in a separate count. Accordingly, it cannot be doubted
that the district court properly dismissed Shonk’s claims against
Yanmar and Mercury under the MMWA, as pleaded in the Initial
Complaint. We, therefore, affirm the district court’s dismissal of
those claims.
Id. (alterations in original).
With respect to the claims against Yanmar and Mercury under the Maryland CPA, the Fourth
Circuit noted that the claims “all pertain[ed] to the sale of the Boat,” and that “each violation
of the Maryland CPA alleged by Shonk in the Initial Complaint require[d] that the defendant
have made the untrue representation about a ‘[c]onsumer good [ ].’” Shonk, 338 F. App’x
at 287–88 (second and third alterations in original). The district court dismissed these claims
because “the Initial Complaint failed to identify a consumer good sold to Shonk by Yanmar
or Mercury.” Id. at 288. The Fourth Circuit affirmed, explaining that the complaint could
not “be reasonably read to identify a consumer good sold to Shonk by Yanmar or Mercury.”
Id.
With respect to the breach of warranty claims against Yanmar and Mercury under the
85

Maryland UCC, the district court dismissed the claims because the complaint “failed to
identify a good warranted by Yanmar or Mercury.” Id. The plaintiff raised the same
argument that Yanmar and Mercury ought to be able to determine their role by tracing a
serial number, but the Fourth Circuit “remain[ed] unimpressed with such arguments and
reject[ed] them on the same grounds that [it] previously rejected them in the context of [the
plaintiff’s] claim under the MMWA and the Maryland CPA against Yanmar and Mercury.”
Id.
The Fourth Circuit also affirmed the district court’s denial of leave to amend, even though
“the Proposed Second Amended Complaint [wa]s far more detailed than the Initial
Complaint or the Proposed First Amended Complaint.” Id. at 289. The court explained that
the additional detail did not avoid the futility of the amendment because “Shonk’s claims
against Yanmar and Mercury under the MMWA, the Maryland CPA, and the Maryland UCC
continued to focus solely upon the Boat.” Shonk, 338 F. App’x at 289. The court continued:
For example, although Shonk set forth his breach of warranty claim
against Yanmar under the MMWA in a separate count, he did not
allege that the Boat’s engines were consumer products under the
MMWA. Rather, he alleged that the Boat (which the Proposed
Second Amended Complaint identifies Fountain as having
manufactured and warranted) is a consumer product under the
MMWA. Because neither Yanmar nor Mercury manufactured nor
warranted the Boat (per Shonk’s allegations in the Proposed Second
Amended Complaint), Shonk’s sole focus on the Boat in his claims
against Yanmar and Mercury rendered the Proposed Second
Amended Complaint futile. Accordingly, we uphold, as not an abuse
of discretion, the district court’s refusal to grant Shonk leave to
proceed under the Second Amended Complaint.
Id. The court also affirmed the grant of summary judgment in favor of Fountain. See id. at
289–90.

Fifth Circuit
•
Jebaco, Inc. v. Harrah’s Operating Co., 587 F.3d 314 (5th Cir. 2009). The plaintiff brought
federal antitrust claims against Pinnacle Entertainment, Harrah’s Operating Company, and
several subsidiaries of Harrah’s. The district court dismissed under Rule 12(c), finding the
claims barred by the state action doctrine and Noerr-Pennington petitioning immunity. Id.
at 315–16. The complaint alleged that under a contract with Harrah’s predecessor, the
plaintiff was entitled to receive a portion of the rent at two berths in Lake Charles, Louisiana.
Id. at 316. The rent was a per-patron fee. Id. Harrah’s eventually took over the payment
obligation. Id. After Hurricane Rita damaged one of Harrah’s riverboats docked at the
berths, Harrah’s ceased operating at that location, stopped its per-patron fee payments to the
plaintiff, and solicited bids for two riverboats, the associated gaming licenses, and the real
86

property associated with the berths. Id. Jebaco placed a bid, but Harrah’s sold to Pinnacle
for $70 million, which Jebaco asserted was greater than the property’s value. Jebaco, 587
F.3d at 316. “Jebaco’s complaint alleged that Harrah’s and Pinnacle violated the Sherman
Act, 15 U.S.C. §§ 1–2, by dividing the Louisiana casino market and by monopolizing,
attempting to monopolize, and conspiring to monopolize that market. Jebaco assert[ed]
[that] this alleged anticompetitive conduct deprived it of both the revenue from a casino
operating at Jebaco’s berths and the ability to purchase Harrah’s assets.” Id. at 317. Jebaco
also asserted state law claims, but the district court declined to exercise supplemental
jurisdiction over those claims after it dismissed the federal claims under Rule 12(c). Id. at
317–18.
The Fifth Circuit did not decide whether the state action doctrine or Noerr-Pennington
petitioning immunity applied, but affirmed the dismissal on the alternate ground that the
complaint did not establish a plausible claim of antitrust standing. Id. at 318 (citing Iqbal,
129 S. Ct. at 1949–50). Notably, “[n]either Pinnacle nor Harrah’s contend[ed] that Jebaco’s
allegations of Sherman Act violations [we]re insufficiently detailed to ‘state a claim to relief
that [wa]s plausible on its face,’” and the Fifth Circuit “assume[d] that Jebaco’s allegations
[we]re legally sufficient under FED. R. CIV. P. 8.” Id. at 318 n.8 (quoting Iqbal, 129 S. Ct.
at 1949). Standing required showing: “1) injury-in-fact, an injury to the plaintiff
proximately caused by the defendants’ conduct; 2) antitrust injury; and 3) proper plaintiff
status, which assures that other parties are not better situated to bring suit . . . .” Id. at 318
(quoting Doctor’s Hospital of Jefferson, Inc. v. Southeast Med. Alliance, 123 F.3d 301, 305
(5th Cir. 1997)) (quotation marks omitted). With respect to the antitrust injury element, the
Fifth Circuit noted that Jebaco alleged that “Harrah’s and Pinnacle’s alleged market division
deprived Jebaco of the per-patron fee it used to receive before Harrah’s ceased operating at
the Lake Charles berths in which Jebaco had an interest,” and that “Jebaco was deprived of
the opportunity to compete by purchasing Harrah’s Lake Charles assets because only
Pinnacle could provide Harrah’s with the opportunity to engage in anticompetitive conduct.”
Jebaco, 587 F.3d at 319. The Fifth Circuit held that “[n]either allegation fit[] comfortably
within a ‘classical’ antitrust fact pattern, and both fail[ed] to allege antitrust injury.” Id.
The court noted that the first allegation related to Jebaco’s position as a landlord/supplier of
a berth, and that “Jebaco characterize[d] the loss of its per-patron fee ‘interest’ as injury to
its ‘competitive position,’” but stated that “how it was competing or against whom in receipt
of the fees is a blank.” Id. at 320. The court noted that “[u]nder Twombly, . . . we must
accept Jebaco’s factual allegations but are not bound to its legal conclusions.” Id. The court
found that “[t]he closest, albeit imperfect, market analogies to the Jebaco-casino operator
relationship are those of landlord-tenant or supplier customer,” but that “[t]hose
relationships, when terminated or modified as a byproduct of ‘downstream’ anticompetitive
conduct, have rarely been held to inflict antitrust injury.” Id. (citation omitted). The court
further explained that in the present case, “the market division ha[d] little or nothing to do
with Jebaco’s lost per-patron fees” because “[h]ad Pinnacle remained at Jebaco’s preferred
berths and kept paying the fees, the alleged market division would still have occurred, and
Jebaco would be uninjured.” Id. The court also explained that “[a]lternatively, if a different
87

firm had purchased Harrah’s assets, it too might have chosen not to operate at Jebaco’s
preferred berths,” and “[n]o antitrust violation would have occurred, but Jebaco would have
suffered the same injury.” Jebaco, 587 F.3d at 320 (citation omitted). The court concluded
that “Pinnacle’s choice to change berths, a choice wholly independent of any antitrust
violation, was the cause of Jebaco’s injury.” Id. The court stated:
The federal antitrust laws protect competition, not competitors. A
lessor’s or supplier’s injury is not injury to competition except, for
instance, where the injury is the direct result of an illegal refusal to
deal or a tying violation. Jebaco did not allege that Pinnacle’s choice
to reposition its licenses in Lake Charles was itself an anticompetitive
act.
Id. at 320–21. Because “Jebaco’s loss of its per-patron fees [wa]s neither the type of injury
antitrust law was designed to prevent, nor did it flow from any anticompetitive conduct of
Harrah’s and Pinnacle[,] . . . Jebaco did not have antitrust standing to sue.” Id. at 321.
Jebaco also “characteriz[ed] itself, in wholly conclusional terms, as a ‘potential competitor’
of Harrah’s and Pinnacle [as] a ‘potential bidder’ for the casino assets,” and “assert[ed] that
their market division conspiracy eliminated its ability to enter the market utilizing its Lake
Charles berthing interest.” Id. The court stated that “[c]ertain theoretical objections” could
be “raised against this claim”:
For instance, potential competitors must meet a threshold of
preparedness to enter a market before they may seek damages from
anticompetitive exclusion. Jayco Systems, Inc. v. Savin Business
Machines Corp., 777 F.2d 306, 313–16 (5th Cir. 1985) (citing Martin
v. Phillips Petroleum Company, 365 F.2d 629, 633 (5th Cir. 1966)).
Such threshold proof is necessary to protect antitrust litigation from
frivolous claims. Following Twombly and Iqbal, it is likely that
Jebaco’s mere allegations of potential competitor status, without any
facts to demonstrate its financial status or its ability to fulfill the
demanding requirements of Louisiana gaming law, are insufficiently
pled. Further, any potential competitor’s antitrust claim would have
to be viewed skeptically in a market where entry is fully controlled
by a regulatory body.
Id. (emphasis added). Despite the theoretical objections, the court “assume[d] arguendo that
Jebaco satisfactorily pled its preparedness and ability to compete in the casino operating
market,” Jebaco, 587 F.3d at 321, but still found the allegations insufficient. The court held
that “[e]ven as a potential competitor, . . . Jebaco’s injury did not ‘flow [ ] from’ an antitrust
law violation,” id. (citation omitted) (second alteration in original), because “Jebaco would
have suffered the same harm whether Harrah’s retained its Lake Charles assets or sold them
to any party other than Pinnacle.” Id. The court further held that “Harrah’s selection of
88

Pinnacle from among a number of bidders [wa]s distinct from the decision to maintain or
reject berths where Jebaco owned an interest, and it [wa]s that interest alone which
support[ed] Jebaco’s status as a potential competitor.” Id. at 322. The court concluded: “Put
differently, any conspiracy between Harrah’s and Pinnacle to dominate the casino market
operated independently of Jebaco’s interest. Jebaco, even as a potential competitor, was at
most a collateral casualty of the Harrah’s-Pinnacle market division agreement.” Id.
•

Floyd v. City of Kenner, La., No. 08-30637, 2009 WL 3490278 (5th Cir. Oct. 29, 2009)
(unpublished, non-precedential, per curiam). The plaintiff brought a civil rights action
against the City of Kenner and four police officers. Id. at *1. The plaintiff was the City’s
chief administrative officer and oversaw a center that distributed food and supplies after
Hurricane Katrina. Id. The complaint alleged that in delivering items, the plaintiff ran into
then-Chief of Police Nick Congemi, and the two had a verbal exchange based on Congemi
viewing the plaintiff as a political nemesis. Id. The next day, National Guardsman from the
center complained that the plaintiff was illegally distributing some supplies. Id. One of the
National Guardsman was patrolling the plaintiff’s neighborhood and, together with another
defendant, entered the plaintiff’s property, allegedly in response to a house alarm, and saw
relief items in plain view. Id. Based on this incident, a search warrant was procured, the
police seized the supplies from the plaintiff’s home, and the plaintiff was arrested, but never
prosecuted. Floyd, 2009 WL 3490278, at *1. The plaintiff’s complaint named the City, the
then-police chief of investigations (Caraway), Congemi, the police detective who filed the
affidavits in support of the search and arrest warrants (Cunningham), and the police officer
who entered the plaintiff’s property with the National Guardsman (Deroche). Id. The
plaintiff sued the police officers in both their official and individual capacities, and these
defendants asserted a defense of qualified immunity. Id. at *1–2.
The court noted that in reviewing the claims against the officers, it was “guided both by the
ordinary pleading standard and by a heightened one.” Id. at *2 (citing Schultea v. Wood, 47
F.3d 1427, 1433–34 (5th Cir. 1995) (en banc)). The court “emphasize[d] that this
heightened pleading standard applie[d] only to claims against public officials in their
individual capacities,” explaining that “[t]he Supreme Court’s decision in Leatherman v.
Tarrant County Narcotics and Intelligence Coordination Unit, 507 U.S. 163 (1993), made
clear that a heightened pleading standard was inapplicable to suits against municipalities.”
Id. at *2 n.2. The court also noted that “the heightened pleading standard [wa]s inapplicable
to claims against public officials in their official capacity,” because “‘official-capacity
lawsuits are typically an alternative means of pleading an action against the governmental
entity involved . . . .’” Id. (quoting Baker v. Putnal, 75 F.3d 190, 195 (5th Cir. 1996)). The
court explained that “once a defendant asserts the defense of qualified immunity, a district
court may order the plaintiff to submit a reply after evaluating the complaint under the
ordinary pleading standard”; that “more than mere conclusions must be alleged”; that “‘a
plaintiff cannot be allowed to rest on general characterizations, but must speak to the factual
particulars of the alleged actions, at least when those facts are known to the plaintiff and are
not peculiarly within the knowledge of defendant’”; and that “‘[h]eightened pleading
requires allegations of fact focusing specifically on the conduct of the individual who caused
89

the plaintiff’s injury.’” Floyd, 2009 WL 3490278, at *2 (citations omitted).
With respect to Deroche, the district court held that although there was a possible
constitutional violation, qualified immunity applied because the conduct “‘was not
objectively unreasonable in light of clearly established law.’” Id. at *3. The Fifth Circuit
held that the plaintiff adequately responded in his reply to Deroche’s statement in his answer
that Deroche had only responded to an alarm, explaining that the reply “directly challenge[d]
the claim that the alarm created the probable cause for Deroche to go to Floyd’s residence.”
Id. The court rejected the argument that Deroche’s actions had to be considered in light of
the chaos that followed Hurricane Katrina, finding that there may be no support for the
plaintiff’s claims that Deroche took advantage of the chaos, “[b]ut the claim exists.” Id. at
*4. The court noted that in certain cases, it may be appropriate to grant discovery before
dismissing a claim:
In Schultea, we adopted the rationale that, “in some cases,
such as in search cases, probable cause and exigent circumstances
will often turn on facts peculiarly within the knowledge of the
defendants. And if there are conflicts in the allegations regarding the
actions taken by the police officers, discovery may be necessary.”
Schultea, 47 F.3d at 1432 (citing Anderson v. Creighton, 483 U.S.
635, 646 n.6, 107 S. Ct. 3034, 97 L. Ed. 2d 523 (1987)). Here, the
Defendants ask us to accept that Deroche entered the property for the
sole purpose of determining if relief items were present. At the time,
Deroche alleged he entered because of the alarm. Floyd asserts that
Deroche knew that Floyd was not misappropriating relief items;
instead, the entry into the property was all about embarrassing Floyd
because of his past run-ins with then-Chief of Police Congemi.
Id. (emphasis added). The court concluded that “[t]his is the type of conflict that warrants
discovery,” and that “[t]he district court should not have dismissed the claim.” Id.
With respect to Cunningham, the district court held that the complaint did not allege
sufficient facts to support a constitutional violation. Floyd, 2009 WL 3490278, at *5. The
Fifth Circuit concluded that the allegation that “an affiant intentionally acted by way of an
omission in order to cause a constitutional violation” was a claim in which “state of mind
is a critical element . . . .” Id. The court held that “[a]t a later stage, Floyd w[ould] be
required to ‘produce specific support for his claim of unconstitutional motive,’” but that “[a]t
the pleading stage, his allegation that Cunningham’s actions were spurred by Congemi’s ill
will suffice[d].” Id. (citation omitted). The court concluded that while some allegations
were insufficient, the allegations as a whole stated a claim against Cunningham:
To be sure, certain portions of Floyd’s Schultea reply are
insufficient to state a plausible claim. Floyd, for example, averred
that Cunningham’s affidavit contained “statements of which he had
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no personal knowledge” that were “sworn to by him in reckless
disregard of the truth.” The Supreme Court emphasized in Iqbal that
such “[t]hreadbare recitals of the elements of a cause of action,
supported by mere conclusory statements, do not suffice.” 129 S. Ct.
at 1949.
But viewed in their entirety, Floyd’s pleadings contain more.
The Schultea reply points out that Cunningham’s affidavit stated that
Floyd was observed loading supplies in a City of Kenner truck on
September 19, 2005, at the center, which is located at 2500 Williams
Boulevard. Cunningham’s affidavit also stated that the items seen in
plain view by Deroche at Floyd’s home “were identical to the ones
observed on the bed of the City of Kenner truck” at the center on
September 19. Floyd’s pleadings allege that Cunningham knew this
statement to be false because the center was relocated from 2500
Williams Boulevard on September 17 and 18, so a City of Kenner
truck certainly was not present at 2500 Williams Boulevard on
September 19. Floyd further alleges that Cunningham knew Floyd
was the managing supervisor of the center and that he possessed “full
authority to handle[,] dispose and deliver all hurricane supples.” It
is said that Cunningham nonetheless left this relevant if not critical
information out of his affidavit in order to mislead the magistrate.
Taken as true, these facts are sufficient at least to survive Rule
12(b)(6) dismissal. Floyd’s complaint alleges, with factual
specificity, the type of harm that was found unconstitutional in
Franks [v. Delaware, 438 U.S. 154 (1978)]. Accordingly, the alleged
violation was “clearly established” at the time Cunningham acted. In
addition, Cunningham’s alleged intentional actions were not
objectively reasonable. We therefore reverse the district court’s
dismissal of the claims against Cunningham.
Id. (first and second alterations in original).
With respect to Caraway, Floyd alleged that Caraway participated in the applications for the
arrest and search warrants based on facts he knew were false, which resulted in Floyd’s
arrest without probable cause. Id. at *6. Floyd also alleged that Caraway failed to return the
items seized from Floyd’s property. Id. The court noted that “‘[b]ecause vicarious liability
is inapplicable to . . . § 1983 suits, a plaintiff must plead that each Government-official
defendant, through the official’s own individual actions, has violated the Constitution.’”
Floyd, 2009 WL 3490278, at *6 (quoting Iqbal, 129 S. Ct. at 1948). Citing Schultea, a preTwombly case, the court stated it had to “determine whether Floyd alleged the ‘factual
particulars’ necessary to state a valid Fourth Amendment claim against Caraway.” Id. The
court examined Iqbal, noted that “[i]t [wa]s clear, . . . that in the arena of qualified immunity
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(but surely not solely in this arena), discovery [wa]s not the place to determine if one’s
speculations might actually be well-founded,” and concluded that “[c]onsistent with [its]
holding in Schultea, the pleadings must have sufficient precision and factual detail to reveal
that more than guesswork is behind the allegation.” Id. at *7 (citing Schultea, 47 F.3d at
1434). The court noted that limited discovery can, at times, be appropriate before ruling on
a defense of qualified immunity, but explained:
The importance of discovery in such a situation is not to allow
the plaintiff to discover if his or her pure speculations were true, for
pure speculation is not a basis on which pleadings may be filed. Rule
11 requires that any factual statements be supported by evidence
known to the pleader, or, when specifically so identified, “will likely
have evidentiary support” after discovery. FED. R. CIV. P. 11(b)(3)
(emphasis added). There has to be more underlying a complaint than
a hope that events happened in a certain way. Instead, in the “short
and plain” claim against a public official, “a plaintiff must at least
chart a factual path to the defeat of the defendant’s immunity, free of
conclusion.” Schultea, 47 F.3d at 1430. Once that path has been
charted with something more than conclusory statements, limited
discovery might be allowed to fill in the remaining detail necessary
to comply with Schultea. Id. at 1433–34.
Id. (emphasis added). The court concluded that the allegations against Caraway were
insufficient:
Under these standards, Floyd’s allegations against Caraway
amount to nothing more than speculation. The conclusory assertion
that Caraway “participated in, approved and directed” the filing of
false and misleading affidavits is consistent with finding a
constitutional violation, but it needed further factual amplification.
See Iqbal, 129 S.Ct. at 1949. Floyd might not know everything about
what occurred, but the bare allegation does not make it plausible that
he knows anything. Unlike his allegations against Cunningham, this
bare assertion does not provide any detail about what Caraway, as
chief of investigations, did to seek to control Cunningham’s filing of
an affidavit. Put differently, the conclusion presents nothing more
than hope and a prayer for relief.
Id. at *8 (emphasis added). The court held that because “Floyd ha[d] shown nothing in his
complaint to indicate a basic plausibility to the allegation[,] . . . [h]is Section 1983 claim
premised on a Fourth Amendment violation . . . fail[ed].” Id. With respect to the allegation
that Caraway had failed to return Floyd’s property, the court concluded that Louisiana
provided a remedy, barring relief under section 1983. Floyd, 2009 WL 3490278, at *8.
Because Floyd “failed to allege specific facts that constitute[d] a deprivation of either his
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Fourth or Fourteenth Amendment rights,” the court found that “the district court’s dismissal
with respect to the claims against Caraway was correct.” Id. at *9.
With respect to Congemi, Floyd alleged that Congemi personally directed efforts to have the
false affidavits filed, and that the affidavits led to Floyd’s arrest. Id. at *9. The district court
held, and the Fifth Circuit agreed, that “‘none of the ‘facts’ alleged as to Congemi
amount[ed] to a violation of a clearly established constitutional right.’” Id. The Fifth Circuit
explained:
Floyd has failed to provide sufficient factual detail concerning
Congemi’s alleged attempts at personally directing his subordinate
officers to file misleading affidavits. Other than a general
background of why Congemi would have animosity towards Floyd,
no facts are alleged that reveal any specifics of how Congemi
personally told other officers to conspire against Floyd. Moreover,
Floyd’s sweeping statement that Congemi attempted to persuade the
district attorney to prosecute him, even though Congemi knew that
Floyd was authorized to handle the supplies, does not shed further
light on the subject. The claims against Congemi lack the detail
needed to render them plausible. See Iqbal, 129 S. Ct. at 1949.
Accordingly, they were appropriately dismissed.
Id.
Finally, with respect to the claims against the City, the court concluded that “Floyd ha[d]
alleged no facts that would support an inference that the police offers acted pursuant to a
policy or custom,” and that the claim against the City was properly dismissed. Id.
•

Gonzalez v. Kay, 577 F.3d 600 (5th Cir. 2009). The plaintiff alleged that one of the
defendants sent him a collection letter that violated the Fair Debt Collection Practices Act
(FDCPA). The district court dismissed the case for failure to state a claim, but the Fifth
Circuit reversed. “Gonzalez asserted in his complaint that the letter was deceptive in that
the Kay Law Firm ‘pretended to be a law firm with a lawyer handling collection of the
Account when in fact no lawyer was handling the Account or actively handling the file.’”
Id. at 602. The Fifth Circuit explained that “Gonzalez essentially contends that the Kay Law
Firm is not actually a law firm at all but instead is a debt collection agency that used the
imprimatur of a law firm to intimidate debtors into paying their debts.” Id. at 602–03. The
FDCPA, in relevant part, “prohibits ‘[t]he false representation or implication that any
individual is an attorney or that any communication is from an attorney,’” and “‘[t]he use
of any false representation or deceptive means to collect or attempt to collect any debt or to
obtain information concerning a consumer.’” Id. at 603–04 (citing 15 U.S.C. §§ 1692e(3),
1692e(10)) (alterations in original). There was “no dispute that Gonzalez [wa]s a
‘consumer’ under the FDCPA and that Kay and the Kay Law Firm [we]re ‘debt collectors’
under the [FDCPA].” Id. at 604 (citing 15 U.S.C. § 1692a(3), (6)).
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The court discussed the Twombly/Iqbal standard for dismissal in the “standard of review”
section of the opinion, but did not cite those cases later in the opinion. The court examined
the case law regarding letters under the FDCPA, and concluded that “the main difference
between the cases is whether the letter included a clear prominent, and conspicuous
disclaimer that no lawyer was involved in the debt collection at that time.” Id. at 606. The
court explained that some letters were not deceptive as a matter of law, some were so
deceptive and misleading as to violate the FDCPA as a matter of law, and others fell in the
middle. Gonzalez, 577 F.3d at 606–07. The Fifth Circuit concluded that the letter at issue
fell in the middle ground, and that the district court had therefore prematurely dismissed the
complaint. Id. at 607.

Sixth Circuit
•
Tam Travel, Inc. v. Delta Airlines, Inc. (In re Travel Agent Comm’n Antitrust Litig.), 583
F.3d 896 (6th Cir. 2009). The plaintiffs were travel agencies who alleged a § 1 conspiracy
under the Sherman Antitrust Act, based on a series of uniform base commission cuts adopted
by the defendants over a seven-year period. Id. at 898–99. The Plaintiffs alleged that one
industry leader airline would reduce the commissions paid to travel agents, that competitor
airlines would shortly follow suit, and that this pattern happened several times until
eventually the commissions were reduced to zero. See id. at 899–900. The plaintiffs further
alleged that the decision to cut commissions was contrary to the individual defendants’
economic self-interests, and that the defendants had numerous opportunities to conspire. Id.
at 900. The district court dismissed the complaint, finding that with respect to some of the
defendants, the plaintiffs failed to allege any conduct other than sporadic parallel conduct;
that the plaintiffs failed to allege any parallel conduct as to one of the defendants; that
several of the defendants had emerged from bankruptcy and their claims were therefore
discharged; that the plaintiffs failed to allege sufficient facts to plausibly suggest an illegal
agreement with respect to other defendants; and that the plaintiffs alleged no facts with
respect to a holding company that did not itself pay any commissions. Id. at 900–01. The
Sixth Circuit affirmed.
The Sixth Circuit explained that “conscious parallelism” is not prohibited under § 1, and that
“[a] district court’s early assessment of the sufficiency of a § 1 claim under FED. R. CIV. P.
12(b)(6) or FED. R. CIV. P. 12(c) addresses the dilemma of the extensive litigation costs
associated with prosecuting and defending antitrust lawsuits.” Id. at 903–04. The court
rejected the plaintiffs’ attempt to distinguish Twombly, concluding that the allegation of an
agreement was “nothing more than a legal conclusion ‘masquerading’ as a factual
allegation.” Tam Travel, 583 F.3d at 904–05 (citing Eidson v. State of Tenn. Dep’t of
Children’s Servs., 510 F.3d 631, 634 (6th Cir. 2007)). The court also found that the
allegations regarding meetings in which the defendants had the opportunity to conspire did
“not necessarily support an inference of illegal agreement.” Id. at 905. The court noted that
with respect to two of the defendants, the plaintiffs had alleged nothing more than parallel
conduct, and that several other defendants were not even mentioned in the body of the
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complaint or described as linked to the conspiracy. Id. The court explained that if these
latter defendants “‘[sought] to respond to plaintiffs’ [ ] allegations in the § 1 context, [they]
would have little idea where to begin.’” Id. (quoting Twombly, 550 U.S. at 564 n.10)
(alterations in original).
The Sixth Circuit also rejected the argument that the allegations were sufficient to infer that
discovery would reveal circumstantial evidence to suggest a conspiracy. See id. at 906–08.
The court found that the defendants had asserted a “reasonable, alternative explanation for
their parallel pricing behavior”—specifically, that new, alternate methods for purchasing
airfare provided greater economic incentive to cut commission rates on a trial-and-error
basis, and that it was simple and inexpensive for a leader airline to test the market with cuts
and hope that its competitors would follow. Id. at 908. The court explained:
We therefore hold that plaintiffs have failed to allege
sufficient facts plausibly suggesting (not merely consistent with) an
agreement in violation of § 1 of the Sherman Act because defendants’
conduct “was not only compatible with, but indeed was more likely
explained by, lawful, unchoreographed free-market behavior.”
Ashcroft v. Iqbal, 129 S. Ct. at 1950. Pursuant to Twombly, district
courts must assess the plausibility of an alleged illegal agreement
before parties are forced to engage in protracted litigation and bear
excessive discovery costs. Twombly, 550 U.S. 558–59. In this
regard, we note that the plausibility of plaintiffs’ conspiracy claim is
inversely correlated to the magnitude of defendants’ economic
self-interest in making the cuts. We are not persuaded by plaintiffs’
argument that defendants would not seek to reduce base commissions
independently, especially during the late 1990s and into 2002, where
changes in the marketplace provided consumers with alternate
ticket-purchasing options. As the Court stated in Twombly, “there is
no reason to infer that [these defendants] had agreed among
themselves to do what was only natural anyway.” 550 U.S. at 566.
Tam Travel, 583 F.3d at 908–09 (footnotes and additional internal citation omitted)
(alteration in original). The court concluded: “[E]ach defendant’s decision to match a new
commission cut was arguably a reasoned, prudent business decision. Moreover, if each
defendant asked ‘itself’ whether it was ‘better off’ paying base commissions (paid by all) or
not paying base commissions (eliminated by all), each defendant would plausibly elect the
latter (from a purely economic standpoint).” Id. at 910. The court also rejected the
allegations based on opportunity to conspire, finding that “[t]he fact that American and
Continental gathered at industry trade association meetings during the seven-year period
when defendants reduced commission rates should not weigh heavily in favor of suspecting
collusion,” and noting that a similar argument had been rejected in Twombly. Id. at 910–11.
The court also held that “a mere opportunity to conspire d[id] not, standing alone, plausibly
suggest an illegal agreement because American’s and Continental’s presence at such trade
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meetings [wa]s more likely explained by their lawful, free-market behavior.” Id. at 911
(citing Iqbal, 129 S. Ct. at 1950).
In dissent, Judge Merritt asserted that Twombly and Iqbal had not radically changed pleading
standards:
In the recent Twombly and Iqbal cases, quoted and discussed
at length by my colleagues in their majority opinion, the Supreme
Court has started to modify somewhat, but not drastically, the notice
pleading rules that have reigned under Conley v. Gibson, 355 U.S.
41, 45 (1957) (“a complaint should not be dismissed for failure to
state a claim unless it appears beyond doubt that the plaintiff can
prove no set of facts in support of his claim which would entitle him
to relief”). These two cases now require more than simple notice and
conclusory statements of ultimate facts about the case. Instead
plaintiffs must plead “sufficient factual matter” to state a legal claim
or cause of action that is not only “conceivable” but also “plausible,”
independently of the notice given and the legal conclusions
stated—in short, a set of “well-pleaded factual allegations” that make
the cause of action “plausible.” Iqbal, 129 S.Ct. at 1949–51 (2009).
The Supreme Court majority has made clear that it is not making a
major change in the law of pleading with Twombly and its progeny.
Id. at 911–12 (Merritt, J., dissenting) (footnote omitted) (emphasis added). Judge Merritt
argued that the majority had misapplied the pleading standard:
As with any other new, general legal standard, the nature and
meaning of the newly modified standard can be understood and
followed only by analyzing how the standard is applied in actual
cases like this case. Here my colleagues have seriously misapplied
the new standard by requiring not simple “plausibility,” but by
requiring the plaintiff to present at the pleading stage a strong
probability of winning the case and excluding any possibility that the
defendants acted independently and not in unison. My colleagues are
requiring the plaintiff to offer detailed facts that if true would create
a clear and convincing case of antitrust liability at trial without
allowing the plaintiff the normal right to conduct discovery and have
the jury draw reasonable inferences of liability from strong direct and
circumstantial evidence.
Id. at 912. Judge Merritt explained that “[i]f the Twombly pleading issue was ‘close,’ but
insufficient, based only on similar stand-pat nonfeasance toward each other’s historical
territory, the allegations concerning the in unison, affirmative behavior of the airlines in this
case [we]re obviously sufficient,” and noted that “[t]he factual allegations in this case
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create[d] an overwhelming case for the plaintiff to get by a motion to dismiss on the
pleading.” Id. Judge Merritt stated:
To summarize, the complaint alleges that price cuts could not
be made absent unilateral, follow-the-leader action by all of the
defendants. It provides specific times and locations of numerous
meetings attended by the defendants. Finally, and most importantly,
the complaint ties the dates of those meetings with industry-wide
simultaneous rate cuts that followed immediately thereafter. Reading
these allegations as a whole, the complaint clearly satisfies the
Twombly standard. In fact, the Supreme Court in Twombly noted that
multiple competitors making “complex and historically
unprecedented changes in pricing structure . . . for no other
discernible reason” would properly state a claim under § 1 of the
Sherman Act. 550 U.S. at 557 n.4. That appears to be exactly the
situation here.
Tam Travel, 583 F.3d at 913 (Merritt, J., dissenting). Judge Merritt expressed concern that
although few antitrust cases had been decided since Twombly and Iqbal, “district court
judges across the country have dismissed a large majority of Sherman Act claims on the
pleadings[,] misinterpreting the standards from Twombly and Iqbal, thereby slowly
eviscerating antitrust enforcement under the Sherman Act.” Id. at 914 (citing In re Hawaiian
& Guamanian Cabotage Antitrust Litig., No. 08-md-1972 TSZ, 2009 WL 2581510 (W.D.
Wash. Aug. 18, 2009); Bailey Lumber & Supply Co. v. Ga.-Pac. Corp., No. 1:08CV1394LGJMR, 2009 WL 2872307 (S.D. Miss. Aug. 10, 2009); Burtch v. Milberg Factors, Inc., No.
07-556-JJF-LPS, 2009 WL 1529861 (D. Del. May 31, 2009)). Judge Merritt further
explained that “[t]he uniformity needed for the rule of law and equal justice to prevail is
lacking,” and that “[t]his irregularity may be attributed to the desire of some courts, like my
colleagues here, to use the pleading rules to keep the market unregulated, while others refuse
to use the pleading rules as a cover for knocking out antitrust claims.” Id. (citations
omitted). The dissent elaborated:
There are many, including my colleagues, whose preference
for an unregulated laissez faire market place is so strong that they
would eliminate market regulation through private antitrust
enforcement. Using the new Twombly pleading rule, it is possible to
do away with price fixing cases based on reasonable inferences from
strong circumstantial evidence. As in this case, the proponents of this
strategy propose to require either an express written agreement
among competitors or a transcribed oral agreement to fix prices.
Nothing less will do. Insider testimony, a strong motivation to
collude, and aggressive, lock-step unanimity by competitors in
pricing become insufficient to state a case. Over time, the antitrust
laws fall further into desuetude as the legal system and the market
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place are manipulated to benefit economic power, cartels, and
oligopolies capable of setting prices. This case is just one small step
in that direction. But this direction is unlikely to be changed unless
the Supreme Court steps in to make it clear that Twombly may not be
used, as my colleagues propose, as a cover for repealing regulation
of the marketplace through private antitrust enforcement.
Id. at 915.
•

Hensley Mfg. v. ProPride, Inc., 579 F.3d 603 (6th Cir. 2009). The plaintiff asserted claims
for trademark infringement and unfair competition under the Lanham Act, common law
trademark infringement, breach of contract against one of the defendants, misappropriation
of trade secrets against two other defendants, and tortious interference with business
relations. Id. at 607. The district court dismissed the trademark infringement and unfair
competition claims, finding that the fair use exception applied; dismissed the breach of
contract claim, finding that it had to be based on a valid claim for trademark infringement;
and declined to exercise supplemental jurisdiction over the remaining state law claims. Id.
at 608.
In analyzing the trademark infringement claim, the Sixth Circuit found there to be
insufficient factual allegations to support finding a likelihood of confusion:
Here, the complaint does not allege facts sufficient to show
that ProPride’s use of the “Hensley” name creates a likelihood of
confusion as to the source of its products. Hensley Manufacturing
does not claim that ProPride has marked its trailer hitch products with
the trademarks “Hensley,” “Hensley Arrow,” or even “Jim Hensley.”
The name of ProPride’s product, the “Pivot Point Projection Hitch”
or “3P Hitch,” is not even remotely similar to the “Hensley”
trademark. Instead, the complaint challenges ProPride’s use of Jim
Hensley’s name in connection with its advertising of the 3P Hitch.
Although Hensley Manufacturing alleges that this creates “a strong
likelihood of confusion in the marketplace as to the source of origin
and sponsorship of the goods of the Plaintiff and the Defendant,”
such a conclusory and “formulaic recitation” of the elements of a
trademark infringement cause of action is insufficient to survive a
motion to dismiss. See Iqbal, 129 S. Ct. at 1954 (“Rule 8 does not
empower respondent to plead the bare elements of his cause of action
. . . and expect his complaint to survive a motion to dismiss.”).
Id. at 610–11. The court also found that even if the plaintiff had adequately alleged
likelihood of confusion, the claim would fail under the fair use doctrine because “the
complaint and attached exhibits show[ed] that ProPride’s uses of Jim Hensley’s name [we]re
descriptive” and the plaintiff “did not allege facts from which any inference of bad faith
98

c[ould] be drawn . . . .” Id. at 612. The court also explained that because “the facts Hensley
Manufacturing alleged in its complaint, as well as the attached exhibits, demonstrated that
there was no likelihood of confusion and that the fair use defense conclusively applied as a
matter of law,” dismissal was appropriate. See id. The court found insufficient the
plaintiff’s argument that “‘facts may exist that establish a level of consumer confusion’ and
that ‘facts may exist that establish that ‘Hensley’ is not being used fairly and in good faith,’”
because “mere speculation is insufficient.” Hensley Mfg., 579 F.3d at 613. The court
concluded: “Simply put, Hensley Manufacturing failed to state a claim for relief that is
‘plausible on its face.’” Id. (quoting Twombly, 550 U.S. at 570; citing Iqbal, 129 S. Ct. at
1949).
•

Courie v. Alcoa Wheel & Forged Prods., 577 F.3d 625 (6th Cir. 2009). The plaintiff sued
his employer and his union, alleging that they discriminated against him by settling his union
grievance with an agreement that “branded him a racist.” Id. at 628. The district court
dismissed the complaint and the Sixth Circuit affirmed. Id. The complaint alleged that after
the plaintiff called a fellow employee a derogatory name in front of management, his
employer sent him a warning that it considered the term “‘racially offensive.’” Id. The
plaintiff filed a grievance with his union, “stating that he was not a racist and that other . .
. employees of various races had also used the term.” Id. The plaintiff sued in federal court,
claiming his employer breached anti-discrimination provisions of the collective bargaining
agreement, and that his union breached its duty of fair representation to him by entering into
a settlement agreement; that the settlement violated Ohio state law; that he was defamed; and
that the defendants were liable under the tort of intentional infliction of emotional distress
when they settled the dispute without his consent. Id. at 629. The plaintiff’s wife alleged
loss of consortium. Courie, 577 F.3d at 629.
In discussing the pleading requirements, the Sixth Circuit noted that “[t]he Supreme Court
recently raised the bar for pleading requirements beyond the old ‘no-set-of-facts’ standard
of Conley . . . that had prevailed for the last few decades.” Id. (citing Iqbal, 129 S. Ct. at
1979; Twombly, 550 U.S. at 555) (emphasis added). The court explained that “Conley itself
had reflected a change away from ‘code pleading’ to ‘notice pleading,’ and the standard it
announced was designed to screen out only those cases that patently had no theoretical hope
of success.” Id. (footnote omitted) (citing Conley, 355 U.S. at 45–46 (“‘In appraising the
sufficiency of the complaint we follow, of course, the accepted rule that a complaint should
not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff
can prove no set of facts in support of his claim which would entitle him to relief.’”); Iqbal,
129 S. Ct. at 1959 (Souter, J., dissenting) (“observing that ‘[t]he sole exception’ to the
Conley rule was for ‘allegations that [were] sufficiently fantastic to defy reality as we know
it; claims about little green men, or the plaintiff’s recent trip to Pluto, or experiences in time
travel’”)) (alterations in original).
In analyzing the complaint at issue, the Sixth Circuit explained that the complaint met the
Iqbal standard with respect to pleading the existence of the settlement agreement,
explaining:
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The Couries’ legal arguments rest wholly upon the existence
of a “settlement agreement” that possibly does not exist: all we have
is an unsigned proposal from the [union] to [the employer]. Yet a
complaint need only “contain sufficient factual matter” to be
“plausible,” Iqbal, 129 S. Ct. at 1949, and we cannot dismiss for
factual implausibility “even if it [would] strike[ ] a savvy judge that
. . . recovery is very remote and unlikely,” Twombly, 550 U.S. at 556,
127 S. Ct. 1955 (internal quotation marks and citation omitted); see
also Iqbal, 129 S. Ct. at 1950 (“Determining whether a complaint
states a plausible claim for relief will . . . be a context-specific task
that requires the reviewing court to draw on its judicial experience
and common sense.”). Here, Courie has alleged that this settlement
agreement exists and has provided an unsigned settlement proposal
as an exhibit to his complaint in support. For purposes of his motion
to dismiss, that is “sufficient” detail for us to assume that the
agreement existed.
Id. at 630 (third and fourth alterations in original). But the court concluded that the claim
that the union breached its duty of fair representation failed because “[t]here was . . . nothing
improper about the union negotiating an agreement whereby Courie admitted that he should
not have called his coworker [the derogatory term] in exchange for the warning to be
stricken from his record,” and “[b]argaining for such an exchange was reasonable union
action.” Id. at 631. The court also concluded that the claim that the plaintiff’s employer
breached the collective bargaining agreement failed first because the other half of his hybrid
Labor Management Relations Act claim failed, but also because he could not “prove
discrimination because he [could not] prove that he was singled out for discriminatory
treatment considering that he was the only one who had been warned, and we already know,
per his state claim, that the warning itself was permissible.” Id. The court concluded that
“[a]s a result[, the plaintiff] [could not] point to any similarly situated employee who had
been treated better, and settling his grievance, save something outrageous, was thus
permissible.” Courie, 577 F.3d at 631. The court held that “[t]he district court properly
found that Courie has not stated a claim to relief under § 301 that is plausible on its face.”
Id. The remaining claims could not prevail in light of the court’s conclusion that the
settlement agreement was not discriminatory. Id. at 632. The Sixth Circuit also concluded
that the district court did not err in denying leave to amend because none of the plaintiff’s
proposed amendments would have made the claims viable. See id. at 633.

Seventh Circuit
•
Kaye v. D’Amato, No. 09-1091, 2009 WL 4546948 (7th Cir. Dec. 4, 2009) (unpublished
order). The plaintiff alleged that the defendants violated the Racketeer Influenced and
Corrupt Organizations Act (RICO) and the corresponding state law, the Wisconsin
Organized Crime Control Act (WOCCA). Id. at *1. The plaintiff, who was an attorney and
real estate developer, alleged that “he was wrongfully denied the opportunity to purchase a
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certain parcel of land owned by the City of Milwaukee because of Defendants’ participation
in an illicit land swap agreement” and “that Defendants conspired to rig a neighborhood
association election in order to maintain control over decisions regarding the development
of land in Milwaukee’s East Village Neighborhood.” Id. The complaint asserted that the
defendants were board members of entities that handled decisions regarding city-owned real
estate. Id. The plaintiff allegedly attempted to purchase a city-owned property called Kane
Place, but several of the entities handling the city’s real estate allegedly refused to sell him
the property because the land had been promised to the commissioner of one of these
entities, even though the plaintiff’s bid was $500 higher than the commissioner’s. Id. The
plaintiff also alleged that at the same time it sold Kane Place, the City Planning Commission
sold another city-owned property to a company owned by the commissioner of another entity
that controlled the city’s real estate for $10,000, “despite the existence of a $250,000 bid
from a competing developer who had already secured financing and invested money in
redevelopment plans.” Id. at *2. The complaint alleged that the plaintiff complained
publicly about the involvement of one of the defendants in selling city-owned land to one
of the commissioners, and that this defendant then publicly announced at a park dedication
that the plaintiff was “blacklisted” from buying city property in the future. Kaye, 2009 WL
4546948, at *2. The complaint separately alleged that “Defendants engaged in misconduct
stemming from the enactment of a zoning ordinance in the East Village Neighborhood.” Id.
One of the defendants allegedly removed a sign from the lawn of the spokesperson for the
group opposing a proposed zoning ordinance and called the spokesperson to tell her that her
employer was looking for the person who posted the sign. Id. The complaint further alleged
that in connection with the next board election for the East Village Association (“EVA”),
the defendants “schemed via email to have their own candidates elected over the objection
of the majority.” Id. “The alleged scheme was executed by changing the voting method
from the simple majority vote required by the EVA bylaws, to a single transferable voting
method.” Id. The change in voting procedures was allegedly carried out through an email
stating: “‘We need to vote in this order for At Large nominations: 1. Mark, 2. Todd, 3.
Ginger, 4. Norbert—do not deviate from that order. DO NOT vote for anyone else.’” Id.
At the new neighborhood association’s inaugural meeting, three Milwaukee police officers
and the son of one of the directors of the EVA “allegedly stood at the entrance of the
building in order to keep unidentified ‘disfavored citizens’ from entering the meeting.”
Kaye, 2009 WL 4546948, at *3.
The district court dismissed the complaint and imposed sanctions on the plaintiff. Id. On
appeal, the Seventh Circuit declined to hear the appeal for lack of jurisdiction. On remand,
the plaintiff filed an amended complaint. The district court dismissed again, “finding (1) that
Kaye had pleaded only two predicate acts which amounted to isolated events; and (2) that
the two events did not demonstrate the continuity necessary to establish a pattern of
racketeering.” Id.
In discussing the applicable pleading standards, the Seventh Circuit noted that “[w]hile
dismissal of a RICO claim is appropriate if the plaintiff fails to allege sufficient facts to state
a claim that is plausible on its face, the adequate number of facts varies depending on the
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complexity of the case.” Id. (citing Limestone Dev. Corp v. Vill. of Lemont, Il., 520 F.3d
797, 803 (7th Cir. 2008)). The court noted that a RICO plaintiff must prove: “(1) conduct;
(2) of an enterprise; (3) through a pattern; (4) of racketeering activity.” Id. at *4 (citation
omitted).
The plaintiff alleged that the city entities in charge of the city’s real estate amounted to
enterprises, but the Seventh Circuit noted that “[n]one of these by itself amount[ed] to a
separate RICO enterprise, which requires both interpersonal relationships and a common
interest.” Id. (citation omitted). The court explained that “[a]lthough Kaye label[ed] each
of these organizations an enterprise, none of the allegations in his amended complaint
suggest[ed] the organizations themselves had any interest in Defendants’ misconduct,” and
that “his allegations merely establish[ed] that the Defendants, though associated with these
organizations, operated collectively in their individual capacities.” Kaye, 2009 WL
4546948, at *4. However, because the court was “required to make all reasonable inferences
in Kaye’s favor, and because there [we]re clearer reasons Kaye’s claims fail[ed], [the court]
generously infer[red] from his allegations an association-in-fact among Defendants.” Id.
With respect to predicate acts, the court noted that the allegations included extortion, bribery,
and fraud. Id. at *5. The alleged extortion included: “(1) [Defendant] D’Amato’s public
‘blacklisting’ of Kaye from future real estate dealings with the City; (2) Milwaukee police
officers’ threats to arrest ‘disfavored citizens’ who tried to enter a public neighborhood
association meeting; and (3) D’Amato’s removal of Jill Bondar’s yard sign and follow-up
phone message.” Id. The first allegation met “Wisconsin’s extortion definition because it
plausibly could involve the threat of financial injury to Kaye, made by a defendant with the
intent to prevent Kaye from engaging in lawful criticism of a public official.” Id. As to the
second alleged act of extortion, the Seventh Circuit “believe[d] the district court was
excessively generous” in inferring that “D’Amato was responsible even though he was not
personally present at the meeting, because one of his aides was a witness to the event.” Id.
The court explained:
In order to find a predicate act of extortion from these allegations, we
must infer not only that D’Amato was responsible from his aide’s
presence, but also that the officers actually barred someone from
entering. Kaye alleged in his complaint that “disfavored citizens”
were barred from the meeting, but he did not identify a single person
who was actually barred. While we are required to make all
reasonable inferences in Kaye’s favor, the complaint does not contain
facts to support these inferences, and without them the claim is not
plausible. See Iqbal, 129 S. Ct. at 1944.
Kaye, 2009 WL 4546948, at *5. However, the court concluded that because the RICO claim
failed for other reasons, it would assume that banning unnamed citizens constituted a
predicate act. Id. Finally, the court stated that it did “not see how removing an illegally
posted sign, and leaving a message requesting information about the identity of the person
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who posted it, m[et] the statutory definition of extortion.” Id. at *6.
The complaint also alleged that two of the defendants “steered the sales of city-owned Kane
Place and Humboldt Boulevard to one another as part of an illicit agreement,” and that “this
constitute[d] two acts of bribery” under Wisconsin law. Id. The court found that the
allegations were insufficient to support this allegation:
The district court found, and we agree, that Kaye’s bribery
allegations lack the factual support to constitute sufficiently alleged
predicate acts. Kaye fails to allege even a single communication
between Fowler and Kohler or any other fact which would support a
reasonable inference of an illicit agreement or that one sale was
compensation for the other. Kaye asked the court to infer such an
agreement based on his allegations that he offered a “better proposal
and higher bid” on Kane Place and that another developer offered a
bid twenty-five times higher than what Fowler paid for Humboldt
Boulevard, but the district court concluded that the city sold Kane
Place to Kohler because her proposed project would be more
beneficial to city development and tax revenues, and sold Humboldt
Boulevard to Fowler because he was the only bidder.
Id. The court concluded that “Kaye’s bribery accusations were wholly unsupported by
factual allegations sufficient to meet the Twombly standard,” and that the district court
appropriately took judicial notice of public records regarding the sales. Id. at *7. The court
concluded: “Without additional factual allegations—at a minimum, an allegation of some
communication between Fowler and Kohler indicating an agreement to ‘swap’ the
land—Kaye ha[d] not ‘nudged his claims . . . across the line from conceivable to plausible.’”
Kaye, 2009 WL 4546948, at *7 (quoting Iqbal, 129 S. Ct. at 1952).
With respect to the fraud allegation, the Seventh Circuit agreed with the district court that
“Kaye ha[d] not alleged a situation in which anyone was misled or fraudulently induced to
engage in activity to their detriment.” Id. at *8. The court continued:
Although Kaye’s allegations, if true, may amount to
questionable conduct on the part of Defendants, “[n]ot all conduct
that strikes a court as sharp dealing or unethical conduct is a ‘scheme
or artifice to defraud’” as those terms are used in the mail and wire
fraud statutes. Kaye’s allegation of wire fraud is supported by a
single e-mail sent to supporters of the new voting method, and
contained no misrepresentations or false statements. This is not
enough to sufficiently allege a predicate act of wire fraud. Kaye also
alleges various acts of honest services fraud relating several
transactions surrounding the alleged land swap. However, the
allegations fail to meet Federal Rule of Civil Procedure 9(b)’s
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heightened pleading standard. Specifically, Kaye failed to allege
facts including who, what, when, where, and how, for each of his
honest services fraud allegations.
Id. (internal citations omitted) (alteration in original).
The Seventh Circuit assumed that two predicate acts had been adequately alleged, but
concluded that the plaintiff had failed to show continuity, as required for a RICO claim. Id.
The court explained that demonstrating “closed-ended continuity,” required alleging “‘a
series of related predicates extending over a substantial period of time,’” id. at *9 (citation
omitted), and that “Kaye ha[d] not satisfied closed-ended continuity because he ha[d] only
sufficiently pleaded two predicate acts, the duration of which was only about seven months,”
and the court had “repeatedly found this and greater periods of time insufficient,” id. at *10.
The court noted that “[a]ll of the acts alleged by Kaye were wrapped up in one general
scheme to control the sale and development of specific city-owned land,” and that “[o]nce
this was accomplished, the scheme would have ended, and so his allegations d[id] not meet
RICO’s continuity requirement.” Id. The court concluded that “[b]ecause [Kaye] failed to
show continuity[,] the district court correctly dismissed Kaye’s complaint.” Id. Finally, the
court noted that “the real victim of the alleged land swap would [have] be[en] the City of
Milwaukee, not Kaye,” because “Kaye [could ]not demonstrate that the city would have sold
him the Kane Place property had they not decided to sell it to Kohler.” Kaye, 2009 WL
4546948, at *10. The Seventh Circuit also affirmed the imposition of sanctions, noting that
the “well-established fact [that Congress enacted RICO to target long-term criminal activity,
not as a means of resolving routine criminal disputes] should have been clear to any attorney,
including Kaye, after minimal research.” Id. at *11.
•

Cooney v. Rossiter, 583 F.3d 967 (7th Cir. 2009). The plaintiff lost custody of her two sons
after a state court found that she suffered from “Munchausen syndrom by proxy.” Id. at 969.
She sued the state court judge (Judge Nordquist), the court-appointed representative for the
children (Bischoff), the court-appointed psychiatrist for the children (Rossiter), the
children’s therapist (Klaung), and her ex-husband’s attorney (Cain), alleging constitutional
violations. The complaint alleged that “Bischoff ‘orchestrated’ a court order appointing
defendant Rossiter as the children’s psychiatrist and began a ‘witch hunt’ against Cooney
by telling Rossiter that ‘this may be a situation of Munchausen syndrome (on the part of the
Mother).’” Id. The psychiatrist later completed his report and concluded that the plaintiff
was showing signs of Munchausen syndrome by proxy, and Judge Nordquist granted the
petition for protection of the children and temporarily transferred custody to the children’s
father. Id. at 969–70. The complaint alleged that “‘numerous other conspiratorial acts
occurred,’” including that Klaung “‘made false statements’” to the Department of Children
and Family Services that led to a finding that the plaintiff committed child abuse. Id. at 970.
The Seventh Circuit concluded that Judge Nordquist was entitled to absolute immunity, and
that Rossiter and Bischoff were also entitled to absolute immunity because the acts the
plaintiff complained about all occurred in the course of Rossiter’s and Bischoff’s courtappoint duties, and the plaintiff did not allege that “Rossiter or Bischoff engaged in
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misconduct outside that course . . . .” Id. at 969, 970.
The court explained that because Cain and Klaung were private persons, the plaintiff could
only sue them under § 1983 by alleging that they agreed with a state officer to deprive her
of her constitutional rights. Cooney, 583 F.3d at 970. The court examined the proper means
of pleading such an agreement:
Even before Bell Atlantic Corp. v. Twombly, 550 U.S. 554,
570 (2007), and Ashcroft v. Iqbal, --- U.S. ----, ----, 129 S. Ct. 1937,
1953, 173 L. Ed. 2d 868 (2009), a bare allegation of conspiracy was
not enough to survive a motion to dismiss for failure to state a claim.
E.g., Loubser v. Thacker, 440 F.3d 439, 443 (7th Cir. 2006); Walker
v. Thompson, 288 F.3d 1005, 1007–08 (7th Cir. 2002); Boddie v.
Schneider, 105 F.3d 857, 862 (2d Cir. 1997); Young v. Biggers, 938
F.2d 565, 569 (5th Cir. 1991). It was too facile an allegation. But it
was a narrow exception to the notice-pleading standard of Rule 8 of
the civil rules—a rare example of a judicially imposed requirement
to plead facts in a complaint governed by Rule 8.
In Bell Atlantic the Supreme Court went further, holding that
in complex litigation a complaint must, if it is to survive dismissal,
make plausible allegations. In Iqbal the Court extended the rule of
Bell Atlantic to litigation in general. Brooks v. Ross, 578 F.3d 574,
2009 WL 2535731, at *5 (7th Cir. Aug. 20, 2009); Hensley Mfg., Inc.
v. ProPride, Inc., 579 F.3d 603, 2009 WL 2778220, at *8 n.4 (6th
Cir. Sept. 3, 2009); Fowler v. UPMC Shadyside, 578 F.3d 203, 2009
WL 2501662, at *4 (3d Cir. Aug. 18, 2009); Moss v. U.S. Secret
Service, 572 F.3d 962, 969 n.7 (9th Cir. 2009).
Id. at 970–71 (emphasis added). That court explained that the “specific concern in Bell
Atlantic was with the burden of discovery imposed on a defendant by implausible allegations
perhaps intended merely to extort a settlement,” and that in Iqbal, the Court was concerned
that “allowing implausible allegations to defeat a motion to dismiss” would make “inroads
into the defense of official immunity—which is meant to protect the officer from the burden
of trial and not merely from damages liability.” Id. at 971 (citing Smith v. Duffey, 576 F.3d
336, 339–40 (7th Cir. 2009)). The Seventh Circuit explained that “as the Court said in Iqbal,
‘determining whether a complaint states a plausible claim for relief will . . . be a
context-specific task that requires the reviewing court to draw on its judicial experience and
common sense.’” Id. (citing Iqbal, 129 S. Ct. at 1950; Courie v. Alcoa Wheel & Forged
Products, 577 F.3d 625, 2009 WL 2497928, at *2 (6th Cir. Aug. 18, 2009)).
The Seventh Circuit emphasized that the level of pleading required depends on the context:
In other words, the height of the pleading requirement is
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relative to circumstances. We have noted the circumstances
(complexity and immunity) that raised the bar in the two Supreme
Court cases. This case is not a complex litigation, and the two
remaining defendants do not claim any immunity. But it may be
paranoid pro se litigation, arising out of a bitter custody fight and
alleging, as it does, a vast, encompassing conspiracy; and before
defendants in such a case become entangled in discovery
proceedings, the plaintiff must meet a high standard of plausibility.
Even before the Supreme Court’s new pleading rule, as we
noted, conspiracy allegations were often held to a higher standard
than other allegations; mere suspicion that persons adverse to the
plaintiff had joined a conspiracy against him or her was not enough.
The complaint in this case, though otherwise detailed, is bereft of any
suggestion, beyond a bare conclusion, that the remaining defendants
were leagued in a conspiracy with the dismissed defendants. It is not
enough (and would not have been even before Bell Atlantic and
Iqbal) that the complaint charges that “Bischoff and Dr. Lyle
Rossiter, with the aid of Judge Nordquist, Dan Cain, and Brian
Klaung continued the ongoing violations of Plaintiff, Deborah’s
Constitutional rights.” That is too vague. With regard to Cain, the
only specific allegations in the complaint are that he encouraged
Bischoff to tell Rossiter to complete his report “expeditiously”; that
he received Rossiter’s report before Cooney did; and that he “took
control” of the meeting in camera in which all the attorneys discussed
the report with Judge Nordquist. The only specific allegation
regarding Klaung is that he reported Cooney to the child welfare
authority several months after she lost custody of the children. No
factual allegations tie the defendants to a conspiracy with a state
actor.
Id. (citations omitted) (emphasis added). The Seventh Circuit affirmed dismissal of the
complaint.
•

Brooks v. Ross, 578 F.3d 574 (7th Cir. 2009). The plaintiff was a member of the Illinois
Prison Review Board who voted in favor of parole for Harry Aleman, was indicted for
misconduct and wire fraud in connection with the parole hearing, and was later acquitted.
Id. at 577–78. The plaintiff filed suit under § 1983 and state law against various officials
involved in the criminal action against him. Id. at 578. The district court dismissed the
complaint for failure to state a claim, and the Seventh Circuit affirmed. Id. In analyzing the
§ 1983 due process claim, the Seventh Circuit examined the recent pleading decisions and
concluded that notice pleading remains intact:
We begin with Rule 8, which states in relevant part: “A pleading that
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states a claim for relief must contain: . . . a short and plain statement
of the claim showing that the pleader is entitled to relief.” FED. R.
CIV. P. 8(a). The Rule reflects a liberal notice pleading regime,
which is intended to “focus litigation on the merits of a claim” rather
than on technicalities that might keep plaintiffs out of court.
Swierkiewicz v. Sorema N.A., 534 U.S. 506, 514, 122 S. Ct. 992, 152
L. Ed. 2d 1 (2002).
In Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S. Ct. 1955,
167 L. Ed. 2d 929 (2007), the Court turned its attention to what was
required of plaintiffs at the pleading stage. It concluded that
plaintiffs’ “[f]actual allegations must be enough to raise a right to
relief above the speculative level.” Id. at 555, 127 S. Ct. 1955. The
Court was careful to note that this did not impose a probability
requirement on plaintiffs: “a well-pleaded complaint may proceed
even if it strikes a savvy judge that actual proof of those facts is
improbable, and that a recovery is very remote and unlikely.” Id. at
556, 127 S. Ct. 1955. The Court did require, however, that the
plaintiffs’ claim be “plausible.” In other words, “it simply calls for
enough facts to raise a reasonable expectation that discovery will
reveal evidence” supporting the plaintiff’s allegations. Id.
Id. at 580–81 (emphasis added) (alteration in original). The court concluded that any
concern that Twombly had repudiated notice pleading “was put to rest two weeks later, when
the Court issued Erickson v. Pardus, 551 U.S. 89, 93, 127 S. Ct. 2197, 167 L. Ed. 2d 1081
(2007).” Id. at 581. The court elaborated:
Erickson reiterated that “[s]pecific facts are not necessary; the
statement need only give the defendant fair notice of what the . . .
claim is and the grounds upon which it rests” (internal quotation
marks omitted) (omission in original). This court took Twombly and
Erickson together to mean that “at some point the factual detail in a
complaint may be so sketchy that the complaint does not provide the
type of notice of the claim to which the defendant is entitled under
Rule 8.” Airborne Beepers & Video, Inc. v. AT & T Mobility LLC,
499 F.3d 663, 667 (7th Cir. 2007).
This continues to be the case after Iqbal. That case clarified
that Twombly’s plausibility requirement applies across the board, not
just to antitrust cases. In addition, Iqbal gave further guidance to
lower courts in evaluating complaints. It noted that a court need not
accept as true “legal conclusions[, or t]hreadbare recitals of the
elements of a cause of action, supported by mere conclusory
statements.” We understand the Court in Iqbal to be admonishing
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those plaintiffs who merely parrot the statutory language of the
claims that they are pleading (something that anyone could do,
regardless of what may be prompting the lawsuit), rather than
providing some specific facts to ground those legal claims, that they
must do more. These are the plaintiffs who have not provided the
“showing” required by Rule 8.
So, what do we take away from Twombly, Erickson, and
Iqbal? First, a plaintiff must provide notice to defendants of her
claims. Second, courts must accept a plaintiff’s factual allegations as
true, but some factual allegations will be so sketchy or implausible
that they fail to provide sufficient notice to defendants of the
plaintiff’s claim. Third, in considering the plaintiff’s factual
allegations, courts should not accept as adequate abstract recitations
of the elements of a cause of action or conclusory legal statements.
Brooks, 578 F.3d at 581 (emphasis added) (alterations in original). The court concluded that
allegations that the defendants produced investigative reports, gave interviews, and were
present and assisted in interviews were “just as consistent with lawful conduct as [they were]
with wrongdoing,” and that “[w]ithout more, [the plaintiff’s] allegations [were] too vague
to provide notice to defendants of the contours of his § 1983 due process claim.” Id. at
581–82 (emphasis added).
The Seventh Circuit examined another paragraph in the complaint, which it concluded
actually contained allegations of wrongdoing, but only in the form of conclusions. The
paragraph from the complaint stated:
Plaintiff is informed, believes and alleges that the Defendants while
acting in concert with other State of Illinois officials and employees
of the Attorney General’s Office, Department of Corrections and
Prisoner Review Board did knowingly, intentionally and maliciously
prosecute Plaintiff and Ronald Matrisciano in retaliation for Plaintiff
and the said Ronald Matrisciano exercising rights and privileges
under the Constitutions and laws of the United States and State of
Illinois.
Id. at 582 (quotation marks omitted). The court concluded that although this paragraph
adequately pleaded personal involvement and unlawful conduct, it failed under Iqbal
“because it [wa]s merely a formulaic recitation of the cause of action and nothing more,” and
“[i]t therefore d[id] not put the defendants on notice of what exactly they might have done
to violate Brooks’s rights under the Constitution, federal law, or state law.” Id. (emphasis
added).
•

Smith v. Duffey, 576 F.3d 336 (7th Cir. 2009). The plaintiff sold a controlling interest in
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his company to a closely-held corporation (Dade Behring, Inc.), in exchange for, among
other things, options to purchase 20,000 shares of Dade Behring’s common stock at $60 a
share. Id. at 336. The plaintiff also became an employee of the company, but his
employment ended with the signing of an agreement in which “he received $1.4 million in
cash and retained his stock options with their $60 exercise price, although the appraised
value of the stock was only $11.” Id. at 336–37. Dade Behring declared bankruptcy a few
months later, and the plaintiff’s stock options were extinguished in the reorganization. Id.
at 337. The plaintiff sued the officers of Dade Behring who had negotiated the agreement
with him, asserting that they knew about the impending bankruptcy that would propose
cancelling his stock options and had a duty to disclose this to him. Id. The plaintiff alleged
two theories: (1) that had he been told that the company was going to declare bankruptcy and
that his stock options would be extinguished, he would have required more money to sign
the termination agreement; and (2) that he was entitled to the value of the shares in the
reorganized company that he would have owned had he been issued stock options in the
reorganized company on the same terms as before the reorganization. Id. The Seventh
Circuit found the latter theory “preposterous,” and explained: “The company was broke, and
the extinction of equity interests is the usual consequence of bankruptcy. Smith could not
have enforced his options once bankruptcy was declared, and he had no right to receive stock
and options in the reorganized company and would not have had that right even if he had
continued as an employee.” Id. With respect to the first theory, the court described it as the
“only remotely plausible argument,” but concluded that it was unlikely the plaintiff would
have succeeded in receiving more cash because “[h]ad the defendants told him the company
was about to declare bankruptcy, he would have realized, if he didn’t already, that his
bargaining position was weak, because in bankruptcy he probably would get nothing at all.”
Smith, 576 F.3d at 337. The court explained that “the likeliest explanation of why the
defendants did not tell Smith about the bankruptcy is that they assumed, and assumed he
assumed, that the parlous state of the company—known to all and symbolized by the
disparity between the appraised value of the stock ($11) and the exercise price of the stock
options ($60)—made his retention of the stock options of no conceivable significance.” Id.
at 338.
The Seventh Circuit explained that it did not need to rely on Twombly or Iqbal to decide that
the complaint was insufficient:
In our initial thinking about the case, however, we were reluctant to
endorse the district court’s citation of the Supreme Court’s decision
in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S. Ct. 1955, 167
L. Ed. 2d 929 (2007), fast becoming the citation du jour in Rule
12(b)(6) cases, as authority for the dismissal of this suit. The Court
held that in complex litigation (the case itself was an antitrust suit)
the defendant is not to be put to the cost of pretrial discovery—a cost
that in complex litigation can be so steep as to coerce a settlement on
terms favorable to the plaintiff even when his claim is very
weak—unless the complaint says enough about the case to permit an
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inference that it may well have real merit. The present case,
however, is not complex. Were this suit to survive dismissal and
proceed to the summary judgment stage, it would be unlikely to place
on the defendants a heavy burden of compliance with demands for
pretrial discovery. . . .
But Bell Atlantic was extended, a week after we heard oral
argument in the present case, in Ashcroft v. Iqbal, --- U.S. ----, 129
S. Ct. 1937, 173 L. Ed. 2d 868 (2009)—over the dissent of Justice
Souter, the author of the majority opinion in Bell Atlantic—to all
cases, even a case (Iqbal itself) in which the court of appeals had
“promise[d] petitioners minimally intrusive discovery.” Id. at 1954.
Yet Iqbal is special in its own way, because the defendants had
pleaded a defense of official immunity and the Court said that the
promise of minimally intrusive discovery “provides especially cold
comfort in this pleading context, where we are impelled to give real
content to the concept of qualified immunity for high-level officials
who must be neither deterred nor detracted from the vigorous
performance of their duties.” Id. (emphasis added).
So maybe neither Bell Atlantic nor Iqbal governs here. It
doesn’t matter. It is apparent from the complaint and the plaintiff’s
arguments, without reference to anything else, that his case has no
merit. That is enough to justify, under any reasonable interpretation
of Rule 12(b)(6), the dismissal of the suit.
Id. at 339–40 (emphasis added) (alteration in original).
•

Hecker v. Deere & Co., 569 F.3d 708 (7th Cir. 2009). The plaintiffs were employees who
alleged that their employer, and a 401(k) plan trustee and investment advisor, breached
fiduciary duties under the Employee Retirement and Income Security Act (ERISA). On
rehearing of its order affirming the district court’s dismissal of the complaint, the court
explained that the fact that the Iqbal opinion had been issued since its original decision did
not change the result:
Applying the pleading standards enunciated in Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007),
we concluded [in the original opinion] that these plaintiffs failed to
state a claim for the kind of fiduciary misfeasance the Secretary
describes. At the time we wrote, the Court had not yet handed down
Ashcroft v. Iqbal, --- U.S. ---, 129 S. Ct. 1937, 173 L. Ed. 2d 868
(2009). Iqbal reinforces Twombly’s message that “[a] claim has
facial plausibility when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant is liable
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for the misconduct alleged.” Id. at 1949. The Court explained
further that “where the well-pleaded facts do not permit the court to
infer more than the mere possibility of misconduct, the complaint has
alleged—but it has not ‘show[n]’—‘that the pleader is entitled to
relief.’ FED. RULE CIV. PROC. 8(a)(2).” Id. at 1950.
Id. at 710–11 (second and third alterations in original). The court concluded that: “this
complaint, alleging that Deere chose this package of funds to offer for its 401(k) Plan
participants, with this much variety and this much variation in associated fees, failed to state
a claim upon which relief can be granted.” Id. at 711.
•

Brown v. JP Morgan Chase Bank, No. 08-1890, 2009 WL 1761101 (7th Cir. Jun. 23, 2009)
(unpublished order). The plaintiff sued under § 1985(3), asserting that the defendant
creditors conspired to violate his civil rights based on his race. The claims were based on
the creditors moving in state court to vacate a foreclosure decree seven months after a
bankruptcy dismissal, claiming they had just discovered that the automatic stay was in effect
at the time of the foreclosure action. Id. at *1. The district court dismissed for failure to
state a claim and the Seventh Circuit affirmed. The Seventh Circuit explained:
Brown’s complaint does not allow a plausible inference that
the defendants are liable under § 1985. As is relevant here, a claim
under § 1985 requires a racially motivated conspiracy to violate or
interfere with a plaintiff’s federally protected rights. Brown has not
explained how either Chase’s allegedly false statement or its
unsigned certificate of service in its request to vacate the foreclosure
decree, both filed several months after the bankruptcy action ended,
violated or interfered with any federal right.
Brown’s grievance that Chase violated his civil rights by not
dismissing the foreclosure action in August 2005 also does not state
a claim. We have not held that the automatic stay imposes on
creditors an affirmative duty to dismiss pending lawsuits, though at
least one other circuit has so held. But in any case Brown’s
complaint does not “contain any factual allegation to plausibly
suggest [that defendants had] discriminatory state of mind.” See
Iqbal, 129 S. Ct. at 1952. In Iqbal, the plaintiff filed a Biven[]s action
against government officials claiming that they detained and abused
him after the terrorist attacks of September 11, 2001, “on account of
his religion, race, and/or national origin and for no legitimate
penological interest.” Id. at 1954 (internal quotation marks omitted).
The Court held that Iqbal’s bare-bones allegations were legal
conclusions and therefore insufficient to state a claim for
discrimination. Id. Brown’s claim is at least as deficient: He gives
us no “factual context,” see Iqbal, 129 S. Ct. at 1954, or reasons to
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support his unexplained legal conclusion that Chase discriminated
against him because of his race when, consistent with the stay, it
refrained from moving ahead with its foreclosure action and merely
neglected to dismiss it.
Id. at *2 (first alteration in original) (internal citations omitted).

Eighth Circuit
•
Braden v. Wal-Mart Stores, Inc., --- F.3d ----, 2009 WL 4062105 (8th Cir. Nov. 25, 2009).
The plaintiff was a Wal-Mart employee and a participant in Wal-Mart’s employee retirement
plan (the “Plan”). The plaintiff sought to bring a class action against Wal-Mart and its
executives involved in managing the Plan, alleging that the defendants violated fiduciary
duties imposed by the Employee Retirement Income Security Act (ERISA). Id. at *1. The
district court dismissed the complaint because it concluded that the plaintiff lacked
constitutional standing to assert claims based on breaches of fiduciary duty before he first
contributed to the Plan and that he failed to state a plausible claim for relief. Id. The Eighth
Circuit reversed and remanded. Id.
The complaint contained 5 causes of action, and “[t]he gravamen of the complaint [wa]s that
[the defendants] failed adequately to evaluate the investment options included in the Plan.”
Id. Specifically, the complaint asserted that “the process by which the mutual funds were
selected was tainted by [the defendants’] failure to consider trustee Merrill Lynch’s interest
in including funds that shared their fees with the trustee,” and that “[t]he result of these
failures . . . [wa]s that some or all of the investment options included in the Plan charge[d]
excessive fees.” Id. The court explained that the factual allegations were detailed:
Braden alleges extensive facts in support of these claims. He
claims that Wal-Mart’s retirement plan is relatively large and that
plans of such size have substantial bargaining power in the highly
competitive 401(k) marketplace. As a result, plans such as
Wal-Mart’s can obtain institutional shares of mutual funds, which,
Braden claims, are significantly cheaper than the retail shares
generally offered to individual investors. Nonetheless, he alleges that
the Plan only offers retail class shares to participants. Braden also
avers that seven of the ten funds charge 12b-1 fees, which he alleges
are used to benefit the fund companies but not Plan participants.
Braden alleges further that the relatively high fees charged by
the Plan funds cannot be justified by greater returns on investment
since most of them underperformed lower cost alternatives. In
support of this claim, he offers specific comparisons of each Plan
fund to an allegedly similar but more cost effective fund available in
the market. In comparison to an investment in index funds, Braden
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estimates that the higher fees and lower returns of the Plan funds cost
the Plan some $140 million by the end of 2007.
Finally, the complaint also alleges that the mutual fund
companies whose funds were included in the Plan shared with Merrill
Lynch portions of the fees they collected from participants’
investments. This practice, sometimes called “revenue sharing,” is
used to cover a portion of the costs of services provided by an entity
such as a trustee of a 401(k) plan, and is not uncommon in the
industry. Braden alleges, however, that in this case the revenue
sharing payments were not reasonable compensation for services
rendered by Merrill Lynch, but rather were kickbacks paid by the
mutual fund companies in exchange for inclusion of their funds in the
Plan. The Plan’s trust agreement requires appellees to keep the
amounts of the revenue sharing payments confidential.
Braden, 2009 WL 4062105, at *2. The claims included: (1) a claim for breach of fiduciary
duty; (2) a claim that the defendants failed to adequately monitor those responsible for
managing the Plan; (3) a claim for breach of the “duty of loyalty by failure to inform Plan
participants of certain information relating to the fees charged by the Plan funds, as well as
the amounts of the revenue sharing payments made to Merrill Lynch”; (4) a claim that the
defendants with oversight responsibility were liable for the breaches of their cofiduciaries;
and (5) a claim that the revenue-sharing payments were prohibited under ERISA. See id.
The Eighth Circuit concluded that the district court erred in finding that the plaintiff lacked
standing, explaining that the plaintiff had “alleged injury in fact that [wa]s causally related
to the conduct he s[ought] to challenge on behalf of the Plan.” See id. at *3–5. The court
then turned to evaluating the sufficiency of the complaint, and explained that “the complaint
should be read as a whole, not parsed piece by piece to determine whether each allegation,
in isolation, is plausible.” Id. at *6 (citing Vila v. Inter-Am. Inv. Corp., 570 F.3d 274, 285
(D.C. Cir. 2009)). The court also emphasized that evaluating a complaint is “‘a contextspecific task.’” Id. (quoting Iqbal, 129 S. Ct. at 1950). With respect to the breach of
fiduciary duty claim, the Eighth Circuit noted that only the issue of breach was disputed. Id.
“[T]he district court found the complaint inadequate because it did not allege sufficient facts
to show how [the defendants’] decision making process was flawed.” Braden, 2009 WL
4062105, at *7. The Eighth Circuit found that the district court improperly applied Rule 8
because, accepting the factual allegations as true, the plaintiff had stated a claim for breach
of fiduciary duty. Id. The Eighth Circuit explained that the district court erred by
“ignor[ing] reasonable inferences supported by the facts alleged” and by “d[rawing]
inferences in [the defendants’] favor, faulting Braden for failing to plead facts tending to
contradict those inferences.” Id. The court noted that “[e]ach of these errors violate[d] the
familiar axiom that on a motion to dismiss, inferences are to be drawn in favor of the nonmoving party,” id. (citing Northstar Indus. v. Merrill Lynch & Co., 576 F.3d 827, 832 (8th
Cir. 2009)), and that “Twombly and Iqbal did not change this fundamental tenet of Rule
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12(b)(6) practice,” id. The court explained:
The first of these errors stems from the mistaken assumption
that Braden was required to describe directly the ways in which
appellees breached their fiduciary duties. Thus, for example, the
district court faulted the complaint for making “no allegations
regarding the fiduciaries’ conduct.” Rule 8 does not, however,
require a plaintiff to plead “specific facts” explaining precisely how
the defendant’s conduct was unlawful. Erickson v. Pardus, 551 U.S.
89, 93 (2007) (per curiam). Rather, it is sufficient for a plaintiff to
plead facts indirectly showing unlawful behavior, so long as the facts
pled “‘give the defendant fair notice of what the claim is and the
grounds upon which it rests,’” id. (quoting Twombly, 550 U.S. at 555)
(alteration omitted), and “allow[ ] the court to draw the reasonable
inference” that the plaintiff is entitled to relief. Iqbal, 129 S. Ct. at
1949.
Braden has satisfied these requirements. The complaint
alleges that the Plan comprises a very large pool of assets, that the
401(k) marketplace is highly competitive, and that retirement plans
of such size consequently have the ability to obtain institutional class
shares of mutual funds. Despite this ability, according to the
allegations of the complaint, each of the ten funds included in the
Plan offers only retail class shares, which charge significantly higher
fees than institutional shares for the same return on investment. The
complaint also alleges that seven of the Plan’s ten funds charge 12b-1
fees from which participants derive no benefit. The complaint states
that appellees did not change the options included in the Plan despite
the fact that most of them underperformed the market indices they
were designed to track. Finally, it alleges that the funds included in
the Plan made revenue sharing payments to the trustee, Merrill
Lynch, and that these payments were not made in exchange for
services rendered, but rather were a quid pro quo for inclusion in the
Plan.
Id. (alteration in original) (footnote omitted). The court noted that the reasonable inferences
drawn from the facts alleged supported a viable claim:
The district court correctly noted that none of these
allegations directly addresses the process by which the Plan was
managed. It is reasonable, however, to infer from what is alleged that
the process was flawed. Taken as true, and considered as a whole,
the complaint’s allegations can be understood to assert that the Plan
includes a relatively limited menu of funds which were selected by
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Wal-Mart executives despite the ready availability of better options.
The complaint alleges, moreover, that these options were chosen to
benefit the trustee at the expense of the participants. If these
allegations are substantiated, the process by which appellees selected
and managed the funds in the Plan would have been tainted by failure
of effort, competence, or loyalty. Thus the allegations state a claim
for breach of fiduciary duty.
Braden, 2009 WL 4062105, at *8 (citation and footnotes omitted). The court further
explained:
These are of course only inferences, and there may well be
lawful reasons [the defendants] chose the challenged investment
options. It is not Braden’s responsibility to rebut these possibilities
in his complaint, however. The district court erred by placing that
burden on him, finding the complaint inadequate for failing to rule
out potential lawful explanations for appellees’ conduct. It stated that
[the defendants] “could have chosen funds with higher fees for any
number of reasons, including potential for higher return, lower
financial risk, more services offered, or greater management
flexibility.” That may be so, but Rule 8 does not require a plaintiff
to plead facts tending to rebut all possible lawful explanations for a
defendant’s conduct.
Id. (emphasis added). The court stated that “a plaintiff may need to rule out alternative
explanations in some circumstances in order to survive a motion to dismiss,” noting that the
Iqbal case had provided such circumstances. See id. The court explained that “[i]t is in this
sort of situation—where there is a concrete, ‘obvious alternative explanation’ for the
defendant’s conduct—that a plaintiff may be required to plead additional facts tending to
rule out the alternative.” Id. (quoting Iqbal, 129 S. Ct. at 1951; citing Twombly, 550 U.S.
at 566). But the court explained that “[s]uch a requirement [wa]s neither a special rule nor
a new one.” Id. “It [wa]s simply a corollary of the basic plausibility requirement. An
inference pressed by the plaintiff is not plausible if the facts he points to are precisely the
result one would expect from lawful conduct in which the defendant is known to have
engaged.” Id. The court further explained:
Not every potential lawful explanation for the defendant’s
conduct renders the plaintiff’s theory implausible. Just as a plaintiff
cannot proceed if his allegations are “‘merely consistent with’ a
defendant’s liability,” id. at 1949 (quoting Twombly, 550 U.S. at
557), so a defendant is not entitled to dismissal if the facts are merely
consistent with lawful conduct. And that is exactly the situation in
this case. Certainly appellees could have chosen funds with higher
fees for various reasons, but this speculation is far from the sort of
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concrete, obvious alternative explanation Braden would need to rebut
in his complaint. Requiring a plaintiff to rule out every possible
lawful explanation for the conduct he challenges would invert the
principle that the “complaint is construed most favorably to the
nonmoving party,” Northstar Indus., 576 F.3d at 832, and would
impose the sort of “probability requirement” at the pleading stage
which Iqbal and Twombly explicitly reject. See Iqbal, 129 S. Ct. at
1949–50.
To recognize that the pleading standard established by Rule
8 applies uniformly in “all civil actions,” id. at 1953 (quoting FED. R.
CIV. P. 1), is not to ignore the significant costs of discovery in
complex litigation and the attendant waste and expense that can be
inflicted upon innocent parties by meritless claims. See Twombly,
550 U.S. at 558–60. Here, however, we must be attendant to
ERISA’s remedial purpose and evident intent to prevent through
private civil litigation “misuse and mismanagement of plan assets.”
Braden, 2009 WL 4062105, at *9 (footnotes and citation omitted) (emphasis added). The
court noted that the Secretary of Labor had submitted an amicus curiae brief that “expressed
concern over the erection of ‘unnecessarily high pleading standards’ in ERISA cases.” Id.
at *9 n.8.
The court found it important that the plaintiff had limited access to information supporting
his claims:
No matter how clever or diligent, ERISA plaintiffs generally lack the
inside information necessary to make out their claims in detail unless
and until discovery commences. Thus, while a plaintiff must offer
sufficient factual allegations to show that he or she is not merely
engaged in a fishing expedition or strike suit, we must also take
account of their limited access to crucial information. If plaintiffs
cannot state a claim without pleading facts which tend systemically
to be in the sole possession of defendants, the remedial scheme of the
statute will fail, and the crucial rights secured by ERISA will suffer.
These considerations counsel careful and holistic evaluation of an
ERISA complaint’s factual allegations before concluding that they do
not support a plausible inference that the plaintiff is entitled to relief.
Id. at *9 (emphasis added). The court concluded that the plaintiff adequately pleaded his
breach of fiduciary duty claim, noting that “the district court erred in dismissing [that claim]
because it misapplied the pleading standard of Rule 8, most fundamentally by failing to draw
reasonable inferences in favor of the non-moving party as is required.” Id.

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The Eighth Circuit also found that the plaintiff had adequately pleaded his claim for breach
of the duty of loyalty because “he ha[d] alleged sufficient facts to support an inference that
nondisclosure of details about the fees charged by the Plan funds and the amounts of the
revenue sharing payments would ‘mislead a reasonable [participant] in the process of
making an adequately informed decision regarding’ allocation of investments in the Plan.”
Id. at *12 (citation omitted) (second alteration in original).
With respect to the claim that the revenue-sharing payments were prohibited under ERISA,
the Eighth Circuit noted that the district court “concluded . . . that Braden’s claims failed
because he had not pled facts raising a plausible inference that the payments were
unreasonable in relation to the services provided by Merrill Lynch and thus had failed to
show they were not exempted by § 1108.” Id. The Eighth Circuit explained that “[t]his was
wrong because the statutory exemptions established by § 1108 are defenses which must be
proved by the defendant,” and that “Braden d[id] not bear the burden of pleading facts
showing that the revenue sharing payments were unreasonable in proportion to the services
rendered . . . .” Braden, 2009 WL 4062105, at *12. The Eighth Circuit noted that its
conclusion was supported by the language of the statute, which “is plain, and . . . allocates
the burdens of pleading and proof,” and was “in keeping with traditional principles of trust
law, which inform . . . interpretation of ERISA.” Id. at *13. The court noted that “Braden
could not possibly show at this stage in the litigation that the revenue sharing payments were
unreasonable in proportion to the services rendered because the trust agreement between
Wal-Mart and Merrill Lynch required the amounts of the payments to be kept secret,” and
that “[i]t would be perverse to require plaintiffs bringing prohibited transaction claims to
plead facts that remain in the sole control of the parties who stand accused of wrongdoing.”
Id. at *14 (emphasis added).
Because the district court did not consider the merits of the second and fourth claims, having
dismissed them as derivative of other claims, the Eighth Circuit remanded those claims for
the district court to consider. Id.
•

McAdams v. McCord, 584 F.3d 1111 (8th Cir. 2009). The plaintiffs sued several executives
of a provider of mortgage lending and brokerage services (UCAP) and UCAP’s outside
auditor, claiming that the defendants fraudulently induced them to invest in UCAP by
misrepresenting UCAP’s financial situation. Id. at 1113. The district court dismissed the
complaint, finding that the investors did not meet the heightened pleading required under
Rule 9 and the Private Securities Litigation Reform Act of 1995 (PSLRA). On appeal, the
Eighth Circuit agreed that the investors failed to state a claim for federal securities fraud.
Claims under the relevant securities statutes required “(1) a material misrepresentation or
omission, (2) scienter, i.e., a wrongful state of mind, (3) a connection with the purchase or
sale of a security; (4) reliance, (5) economic loss, and (6) loss causation.” Id. Rule 9 and
the PSLRA require stating with particularity the circumstances of the alleged fraudulent
statement, and “[t]he complaint must also ‘state ‘with particularity’ facts giving rise to a
‘strong inference’ that the defendant acted with the scienter required for the cause of
action.’” Id. (citation omitted). The district court dismissed the complaint because it failed
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to plead with particularity the circumstances of the alleged fraud and the facts giving rise to
a strong inference of scienter. Id. The only issue on appeal was whether the investors stated
a claim against the auditor for federal securities fraud.
With respect to the auditor, the court noted that while the complaint made numerous
allegations of false statements by UCAP’s executives and alleged that the auditor assisted
the executives in distorting UCAP’s financial statements, the statute only imposed liability
on those who make misstatements or omissions, not those who aid in making misstatements
or omissions. Id. at 1114. The court further noted that the complaint alleged two
misstatements by the auditor—that the audit was conducted in accordance with generally
accepted accounting principles and that UCAP’s financial statements fairly presented
UCAP’s financial condition. McAdams, 584 F.3d at 1114. The court also noted that the
complaint alleged that the auditor “issued ‘clean’ audit opinions when it knew UCAP’s
financial statements were not accurate,” and that the auditor therefore “allegedly made false
statements with scienter.” Id. But the court found that it did not need to decide whether the
complaint adequately alleged with particularity facts giving rise to a strong inference of
scienter because the complaint failed to adequately plead loss causation. Id. “To adequately
plead loss causation, the complaint must state facts showing a causal connection between the
defendant’s misstatements and the plaintiff’s losses.” Id. (citation omitted). The court held
that the plaintiffs failed to adequately plead loss causation:
The complaint alleges that McAdams invested over $3 million
in UCAP, that Homm invested over $6 million, and that Smyth
invested $2 million. The complaint then broadly alleges that “as a
direct and proximate result of Defendants’ fraudulent
misrepresentations and omission of material facts, Plaintiffs have
been damaged in amounts to be determined at trial but which exceed
$10 million.” This threadbare, conclusory statement does not
sufficiently allege loss causation. It does not specify how two
statements by [the auditor], as compared to the complaint’s long list
of alleged misrepresentations and omissions by the executives,
proximately caused the investors’ losses.
The complaint alleges that the investors suffered damages
because they purchased stock at “artificially inflated prices.” This
allegation is insufficient under Dura [Pharm., Inc. v. Broudo, 544
U.S. 336, 341–42 (2005)]. Specifically, a stock’s subsequent loss in
value can reflect a variety of factors other than the earlier
misstatement. The complaint states that the truth about UCAP’s
financial position was revealed on April 23, 2004, when UCAP
announced that it would need to restate several financial statements.
However, the complaint does not state the value of UCAP’s stock
when the investors made their investments, or its value right before,
or right after, the need for the restatement was announced.
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Without these facts, the complaint does not show that the
investors’ losses were caused by MSF’s misstatements. This failure
is revealing because UCAP’s financial troubles were public
knowledge before the announcement of the need for a restatement in
April 2004. Specifically, in November 2003, UCAP disclosed in an
8-K announcement that its wholly-owned, principal operating
subsidiary was in imminent danger of losing its only line of credit
and that UCAP had sold a controlling share of its stock to avoid the
subsidiary’s bankruptcy. The complaint’s lack of specific allegations
of the value of UCAP stock defeats the plausibility of the investors’
claim that MSF’s audit opinions in January 2002 and 2003 caused
their losses.
Id. at 1115 (internal citation and footnote omitted).

Ninth Circuit
•
William O. Gilley Enters., Inc. v. Atlantic Richfield Co., --- F.3d ----, 2009 WL 4282014
(9th Cir. Dec. 2, 2009) (per curiam). The district court dismissed an antitrust claim based
on section 1 of the Sherman Act, “holding that 1) Aguilar v. Atlantic Richfield Co., 24 P.3d
493 (Cal. 2001), preclude[d] the allegations made in the operative pleading; 2) Defendants’
exchange agreements c[ould] not be aggregated to establish market power and
anticompetitive effect; and 3) even if the exchange agreements could be aggregated, the
absence of a conspiracy to limit supply and raise prices eliminate[d] a causal connection
between the exchange agreements and anticompetitive effect.” Id. at *1. The Ninth Circuit
affirmed.
The plaintiff brought a class action lawsuit “on behalf of himself and other wholesale
purchasers of CARB gasoline in the state of California.” Id. CARB gas was a cleanerburning fuel, and the only gas that could be sold in California since 1996. Id. “The
complaint alleged that Defendants-Appellees, major oil producers, violated § 1 of the
Sherman Act by entering into a conspiracy to limit the supply of CARB gasoline and to raise
prices.” Id. The case was stayed pending resolution of a similar state court case (Aguilar),
which alleged violation of the Cartwright Act, California’s equivalent to the Sherman Act.
Id. After the court in Aguilar granted summary judgment to the defendants because there
was insufficient evidence to find a conspiracy to limit supply and raise prices among the gas
companies, the defendants in the federal action sought summary judgment on the basis of
collateral estoppel. William O. Gilley, 2009 WL 4282014, at *1. The plaintiff filed an
amended complaint, which the district court deemed insufficient, but the court granted leave
to amend. Id. The district court then granted summary judgment on the next amended
complaint, “holding that Gilley was precluded by Aguilar from relitigating whether a
conspiracy existed to limit supply and raise prices,” but granted further leave to amend “to
allege that ‘each of the bilateral agreements, entered into independently between various
defendant gasoline companies, ha[d] anticompetitive effects and therefore violate[d] the
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Sherman Act.’” Id. at *2. The plaintiff filed another amended complaint, “alleging that
forty-four bilateral exchange agreements had the effect of unreasonably restraining trade in
violation of § 1 of the Sherman Act and in violation of CAL. BUS. & PROF. CODE § 17200.”
Id. The district court granted the defendants’ motion to dismiss with prejudice, “explain[ing]
that[, with respect to the section 1 claim,] Gilley had not alleged any theory as to how any
individual exchange agreement, which account[ed] for a small percentage of the relevant
market, [wa]s able to inflate the price of CARB gasoline.” Id. The Ninth Circuit reversed
and remanded, finding that the plaintiff should have been given leave to amend to cure the
newly identified deficiencies. Id. The plaintiff thereafter filed the Second Amended
Complaint, which the district court dismissed because the plaintiffs “failed to allege that the
exchange agreements, when considered individually, would be capable of producing
significant anticompetitive effects.” William O. Gilley, 2009 WL 4282014, at *2. The
appeal concerned this last dismissal.
In considering collateral estoppel, the Ninth Circuit noted that “[t]he core of the plaintiff’s
claims in Aguilar was a per se claim based on an alleged unlawful conspiracy among
petroleum companies.” Id. at *3. The court noted that one portion of Aguilar held “that the
plaintiff had failed to demonstrate the existence of a conspiracy that was per se illegal under
the Sherman Act.” Id. The Ninth Circuit agreed with the district court’s reading of the
Second Amended Complaint “as not alleging that the bilateral agreements ‘violate[d] the
anti-trust laws due to their anti-competitive effect,’ but rather that the agreements
facilitate[d] coordinated action by the defendants that unlawfully restrain[ed] trade.” Id. at
*5. The court explained:
This distinction is critical. If the bilateral agreements in
themselves have an illegal effect on competition (when aggregated),
then the bilateral agreements constitute the “contract, combination or
conspiracy” required for a claim under § 1 of the Sherman Act. If,
however, the bilateral agreements only facilitate coordinated activity,
then to maintain a claim under § 1 of the Sherman Act, Gilley must
show some meeting of the minds, some “contract, combination or
conspiracy,” between those defendants whom Gilley alleges
coordinated their actions. Although a plaintiff might well be able to
do so in the abstract, here, Gilley is precluded by Aguilar from
asserting that the defendants so conspired.
Id. The court noted that “[t]he Second Amended Complaint implicitly, if not explicitly,
assert[ed] a conspiracy.” Id. The court quoted two paragraphs from the complaint:
Chevron’s intent and purpose in entering into these exchange
agreements was to limit refining capacity for CARB gas and/or to
keep CARB gas out of the spot market and away from unbranded
marketers.

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Through the use of these exchange agreements, coupled with
its own refining capacity and that of its contracting partners,
Chevron has obtained sufficient market power to limit the supply of
CARB gas to unbranded marketers and to raise the price at which it
sells CARB gas in Northern California to supracompetitive levels.
These agreements have had the effect of raising CARB gas prices in
Northern California above competitive levels, without any
countervailing procompetitive benefit.
William O. Gilley, 2009 WL 4282014, at *6 (quoting the Second Amended Complaint)
(quotation marks omitted). The court noted that “[t]hese paragraphs reveal[ed] how Gilley
propose[d] to meet the market power requirement for a claim under § 1 of the Sherman Act,
but they l[eft] the reader uninformed as to how the individual exchange agreements allegedly
violated the Sherman Act ‘without a conspiracy to control supply or to set prices.’” Id. The
court concluded: “In sum, the [Second Amended Complaint], plainly and fairly read, is not
limited to alleging that bilateral exchange agreements are themselves restraints of trade.
Instead, its broad allegations encompass conspiracy claims that are precluded by Aguilar.”
Id. at *7. The court noted that “[t]he breadth of the [Second Amended Complaint] [wa]s
inconsistent with the spirit of Twombly.” Id. The court explained that in Twombly,
[t]he Supreme Court reaffirmed its earlier decisions holding that
“something beyond the mere possibility of loss causation must be
alleged, lest a plaintiff with a largely groundless claim be allowed to
take up the time of a number of other people with the right to do so
representing an in terrorem increment of the settlement value,” and
that “when the allegations in a complaint, however true, could not
raise a claim of entitlement to relief, this basic deficiency should . .
. be exposed at the point of minimum expenditure of time and money
by the parties and the court.”
Id. (emphasis added). The court “read the [Second Amended Complaint] as not asserting
that the bilateral agreements, in themselves, restrain[ed] trade, but that they facilitate[d] or
ma[d]e it easier for the defendants to coordinate their actions to restrain trade.” Id. at *8.
The Ninth Circuit relied on the district court’s explanation:
Even if a single defendant and all of the defendants who
contracted with that defendant cumulatively had sufficient market
power to substantially impair competition, Plaintiffs would need to
make the further showing that all of these defendants worked together
through the use of the exchange agreements and strategic shutdowns
or decreased production to stabilize the spot market and avoid the
depression of gasoline prices . . . .
William O. Gilley, 2009 WL 4282014, at *8 (quotation marks omitted). The court found that
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“[t]his is the type of ‘in terrorem increment of the settlement value’ that the Supreme Court
mentioned in Twombly.” Id. The court held that “when viewed in the light of the preclusive
effect of Aguilar, the [Second Amended Complaint] simply ‘d[id] not raise a claim of
entitlement to relief.’” Id. (citation omitted). The court explained:
There can be little doubt that the broad scope of the [Second
Amended Complaint] was intentional. Gilley has known since 2002
that following Aguilar, he was precluded from alleging a conspiracy.
Nonetheless, he has thrice been given the opportunity to amend his
complaint to limit it to a claim based solely on the alleged
anti-competitive effect of the individual exchange agreements absent
a conspiracy, and has thrice proffered amended complaints that
continue to assert, albeit ever more subtly, the existence of a
conspiracy. It might be possible for Gilley to allege an antitrust
claim limited to issues that are not precluded by Aguilar, but he has
declined to do so. Accordingly, the district court properly struck the
[Second Amended Complaint].
Id. The Ninth Circuit also found that “the district court’s final denial of leave under the
circumstances of this case was not an abuse of discretion,” noting that “assuming Gilley
could, in the abstract, amend his complaint to state a claim that [wa]s not precluded by
Aguilar, his repeated failure to do just that suggest[ed] that it would be futile to offer him
another chance to do so.” Id. at *8 & n.8 (footnote omitted).
The court summarized its holdings as follows:
Gilley, in order to state a § 1 claim, must plead “a contract . . . by
which the persons or entities intended to harm or restrain trade.”
Despite its length and detail, the [Second Amended Complaint] does
not clearly assert which individual agreement or agreements
constitute in themselves a “contract . . . by which the persons or
entities intended to harm or restrain trade.” Rather, the [Second
Amended Complaint] is fairly read as alleging the existence of a
network of exchange agreements that arguably allowed the
defendants to unlawfully coordinate their production and output. But
given the preclusive effect of Aguilar, Gilley cannot show such
coordination. The [Second Amended Complaint] is not saved by the
argument that it could be read to encompass a claim that the
individual agreements in themselves constitute a restraint of trade
because the [Second Amended Complaint] does not provide the
defendants fair notice of such a claim and the grounds upon which it
rests. See Twombly, 550 U.S. at 555, 127 S. Ct. 1955. Moreover,
aggregation does not save the [Second Amended Complaint] because
it does not show that the defendants’ adjustments of CARB
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production were part of any agreement or conspiracy, rather than
independent efforts to maximize profits. See Twombly, 550 U.S. at
566, 127 S. Ct. 1955. For these reasons, we affirm the district court’s
dismissal of the Second Amended Complaint without leave to amend,
and we affirm the court’s dismissal of Plaintiffs’ state law claim
brought pursuant to CAL. BUS. & PROF. CODE § 17200.
Id. (omissions in original).
•

Siracusano v. Matrixx Initiatives, Inc., 585 F.3d 1167 (9th Cir. 2009). The complaint
alleged that Matrixx, a pharmaceutical company that sold Zicam Cold Remedy (“Zicam”)
through a wholly-owned subsidiary, made material misrepresentations regarding Zicam’s
safety, in violation of federal securities laws. The class action complaint sought relief
against Matrixx and three of its executives (Johnson, Hemelt, and Clarot) under the Private
Securities Litigation Reform Act of 1995 (PSLRA). The complaint asserted that Matrixx
and its executives failed to disclose that Zicam causes anosmia—a loss of the sense of smell.
Id. at 1169–70. The district court dismissed the complaint, and the Ninth Circuit reversed
and remanded. Id. at 1170.
Chief among the allegations was the assertion that Matrixx filed a November 12, 2003 Form
10-Q report that stated that the company “may incur significant costs resulting from product
liability claims.” Id. at 1172 (quoting the complaint) (quotation marks and emphasis
omitted). The plaintiff alleged that the statements in the 10-Q “were materially false and
misleading because [the defendants] ‘failed to disclose that a lawsuit alleging that Zicam
caused anosmia had already been filed and, given the findings of the researchers at the
University of Colorado [that zinc sulfate caused loss of smell,] it was highly likely that
additional suits would be filed in the future.’” Id. (quoting the complaint). Matrixx later
filed a Form 8-K on February 19, 2004, stating “that it had ‘convened a two-day meeting of
physicians and scientists to review current information on smell disorders,’” and that “‘[i]n
the opinion of the panel, there [wa]s insufficient scientific evidence at th[e] time to
determine if zinc gluconate, when used as recommended, affect[ed] a person’s ability to
smell.’” Id. at 1174 (first alteration in original). In a later Form 10-K, filed March 19, 2004,
Matrixx acknowledged that “‘numerous suits alleged that its Zicam product(s) caused
anosmia had been filed.’” Siracusano, 585 F.3d at 1175. The complaint alleged that
“‘[a]ccording to Matrixx’s own SEC filings, from late 2003 through October 2004 Matrixx
ha[d] been sued by approximately 284 individuals in 19 different lawsuits alleging that
Zicam caused damage to their sense of smell,’ and included in the complaint a table detailing
the lawsuits.” Id. (first alteration in original). The plaintiff “alleged that the financial
information contained in Matrixx’s Form 10-Q filed on November 12, 2003, was false and
misleading and violated SEC rules and the Generally Accepted Accounting Principles
(‘GAAP’) promulgated by the Financial Accounting Standards Board (‘FASB’).” Id. The
complaint further alleged that the materially misleading statements led to artificially inflated
prices. Id. at 1176. The complaint alleged that the defendants acted with scienter:

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[D]efendants acted with scienter in that defendants knew that
the public statements or documents issued or disseminated in the
name of the Company were materially false and misleading; knew
that such statements or documents would be issued or disseminated
to the investing public; and knowingly and substantially participated
or acquiesced in the issuance or dissemination of such statements or
documents as primary violations of the federal securities laws. As set
forth elsewhere herein in detail, defendants, by virtue of their receipt
of information reflecting the true facts regarding Matrixx, their
control over, and/or receipt and/or modification of the Company’s
alleged materially misleading misstatements and/or their associations
with the Company which made them privy to confidential proprietary
information concerning Matrixx, participated in the fraudulent
scheme alleged herein.
Defendants were aware since at least September of 2003, that
numerous users of their Zicam product had experienced a rare
condition known as anosmia or loss of smell. Findings of post
treatment anosmia were reported by Dr. Bruce Jafek, Miriam R.
Linschoten and Bruce W. Morrow of the University of Colorado
School of Medicine, Department of Otolaryngology at a medical
conference in September of 2003. At the time, Dr. Jafek had reported
10 cases of anosmia after Zicam use. As of April of 2004, Dr. Jafek
had evaluated over 100 such cases. On September 12, 2003, over one
month before the start of the Class Period, Matrixx informed Dr.
Jafek that “as a legal matter” he did “not have their permission to use
their company name or product trademarks” in the poster reporting
Dr. Jafek’s research. In order to avoid threatened legal action from
the Company, Dr. Jafek deleted any reference to Zicam or Matrixx
from the poster which he used to present his research at a medical
conference.
Id. (quoting the complaint) (quotation marks and footnote omitted) (alteration in original).
The district court “dismissed the complaint without prejudice, reasoning . . . that the
allegations of user complaints were not material because they were not statistically
significant . . . [and] that [the plaintiffs] had failed sufficiently to allege scienter.” Id. at
1177. The district court “stated that any amendment would be futile ‘[a]bsent allegations
Defendants knew there was a definitive and statistically significant link between Zicam and
anosmia during the Class Period that was ‘sufficiently serious and frequent to affect future
earnings.’” Siracusano, 585 F.3d at 1177 (alteration in original).
On appeal, the Ninth Circuit noted that to allege a claim under Rule 10b-5, “‘a plaintiff must
[allege] ‘(1) a material misrepresentation or omission of fact, (2) scienter, (3) a connection
with the purchase or sale of a security, (4) transaction and loss causation, and (5) economic
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loss,’’” id. (alteration in original) (citation omitted), but because the district court dismissed
based on the first two elements, the Ninth Circuit would only address those two as well, id.
The Ninth Circuit held that “the district court erred in relying on the statistical significance
standard to conclude that [the plaintiffs] failed adequately to allege materiality.” Id. at 1178.
The court explained:
In relying on the statistical significance standard to determine
materiality, the district court made a decision that should have been
left to the trier of fact. Instead, we agree with the approach of the
court in In re Pfizer Inc. Securities Litigation, 584 F. Supp. 2d 621
(S.D.N.Y. 2008), where the United States District Court for the
Southern District of New York rejected the defendant pharmaceutical
company’s argument that the plaintiffs failed to plead materiality,
which was based on the contention that three studies revealing
adverse effects of the company’s drug were not statistically
significant. The court reasoned that it “cannot determine as a matter
of law whether such links were statistically insignificant because
statistical significance is a question of fact.” Id. at 635–36.
Id. at 1179. The Ninth Circuit listed the numerous statements from the complaint that
showed that Matrixx was aware of a possible link between Zicam and anosmia, and found
that they were “sufficient to meet the pleading requirement under the PSLRA, which
require[d] that . . . ‘the complaint . . . specify each statement alleged to have been
misleading, the reason or reasons why the statement is misleading, and, if an allegation
regarding the statement or omission is made on information or belief, . . . state with
particularity all facts on which that belief is formed.’” Id. at 1179–80 (quoting 15 U.S.C.
§ 78u-4(b)(1)). The court also found the allegations sufficient “as well, to ‘nudge[ ] [the
plaintiffs’] claims across the line from conceivable to plausible.’” Siracusano, 585 F.3d at
1180 (first alteration in original).
With respect to scienter, the court explained that it first had to “‘determine whether any of
the plaintiff’s allegations, standing alone, [we]re sufficient to create strong inference of
scienter,’” and if not, it would then “‘conduct a ‘holistic’ review of the same allegations to
determine whether the insufficient allegations combine[d] to create a strong inference of
intentional conduct or deliberate recklessness.’” Id. (citation omitted). The Ninth Circuit
concluded that the complaint adequately alleged scienter:
The district court here concluded that the [complaint] failed
to allege the requisite scienter because it “fail[ed] to allege any
motive or state of mind with relation to the alleged omissions.” In
order adequately to allege scienter, [the plaintiffs] rely on their
allegations that [the defendants] knew about the problems with Zicam
but chose not to reveal them. [The plaintiffs] also argue that the
importance of Zicam to Matrixx’s business supports the inference
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that [the defendants] intentionally withheld information of the link
between Zicam and anosmia. [The plaintiffs] also point to the
revelations following the close of the class period that, contrary to
their statements during the class period, Matrixx actually did not
know if Zicam caused anosmia and decided to conduct studies after
they had already vouched for the safety of Zicam.
Matrixx’s first allegedly misleading statement was its October
22, 2003, press release, announcing the 163% net sales increase,
attributed to Zicam, and stating that the Zicam brand was “poised for
growth.” The second statement was the conference call on October
23, 2003, again attributing the company’s positive results to Zicam
and projecting further growth. By the time of the press release and
the conference call, [the Neurological Director of the Smell & Taste
Treatment and Research Foundation, Ltd. (Linschoten)] had called
the customer service line regarding one patient, Clarot had spoken
with [a researcher at the University of Colorado Health Sciences
Center] regarding customer complaints, Jafek had presented his
report of eleven patients, and the first lawsuit against Matrixx had
been filed. [The defendants] accordingly were aware of at least
fourteen complaints regarding Zicam and anosmia at the time they
made these statements. In addition, [the defendants] alleged that
Clarot told Linschoten in the September 2002 phone call that
“Matrixx had received customer complaints of loss of smell as early
as 1999.” [The plaintiffs] then alleged that the November 12, 2003,
Form 10-Q was misleading because it spoke of the risk of product
liability actions against the company without revealing that a lawsuit
already had been filed.
Id. at 1180–81 (footnote omitted). The court explained that “the passage in the Form 10-Q
sp[oke] about the risks of product liability claims in the abstract, with no indication that the
risk ‘may already have come to fruition’”; that the complaint “allege[d] facts sufficient for
a jury to find that Clarot was aware of the potential anosmia problem”; and that “the
inference that high-level executives such as Johnson, Hemelt, and Clarot would [have]
know[n] that the company was being sued in a product liability action [wa]s sufficiently
strong to survive a motion to dismiss.” Id. at 1181. Although the plaintiffs did not allege
that the defendants “engaged in unusual or suspicious stock sales at the same time that they
were attempting to downplay the reports of anosmia, . . . ‘the absence of a motive allegation
[wa]s not fatal.’” Id. at 1182 (quoting Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S.
308, 324 (2007)). The court also concluded that it was appropriate to view the complaint as
a whole in determining whether the allegations were sufficient:
On a holistic review of the [complaint], the following picture
is alleged. Matrixx received some customer complaints about Zicam
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and anosmia from 1999 to 2002. In 2002, Clarot was sufficiently
concerned that he called Linschoten about one of her patients who
had complained and then called to ask if she would participate in
studies. In September 2003, Matrixx knew that Jafek and his
colleagues were presenting findings about ten or eleven patients who
developed anosmia after Zicam use and did not allow Jafek to use
Matrixx’s or Zicam’s name in the presentation. In October 2003,
Matrixx touted the potential for growth and profitability of Zicam in
a press release and an earnings conference call. A lawsuit alleging
anosmia in one Zicam user was filed in October 2003. In November
2003, Matrixx filed a Form 10-Q, but did not disclose the lawsuit in
the section entitled “Risk Factors.”
More lawsuits were filed in December 2003 and January 2004.
On February 2, 2004, Matrixx issued a press release
responding to the January 30, 2004, Dow Jones report that the FDA
was investigating Zicam and anosmia. This press release called the
report “completely unfounded and misleading” and asserted that
clinical trials had established the safety of zinc gluconate. On
February 6, 2004, Good Morning America reported on the possible
link between Zicam and anosmia, and Matrixx issued another press
release asserting that zinc gluconate’s safety was well established in
clinical trials, even though it was subsequently reported that Matrixx
had not conducted such studies. In a February 19, 2004, filing with
the SEC, Matrixx stated that it had convened a panel of physicians
and scientists to review the information and asserted that there was
insufficient evidence to determine whether zinc gluconate affected
the sense of smell. On March 4, 2004, a news article reported that
Matrixx would begin studies to determine if Zicam caused anosmia.
Viewing the [complaint] as a whole, the inference of scienter
is “cogent and at least as compelling” as any “plausible non-culpable
explanation [ ]” for [the defendants’] conduct. Tellabs, 551 U.S. at
324, 127 S. Ct. 2499. Withholding reports of adverse effects of and
lawsuits concerning the product responsible for the company’s
remarkable sales increase is “an extreme departure from the standards
of ordinary care” and “presents a danger of misleading buyers or
sellers.” We therefore conclude that the inference that [the
defendants] withheld the information intentionally or with deliberate
recklessness is at least as compelling as the inference that [the
defendants] withheld the information innocently.
Id. at 1182–83 (footnote and internal citation omitted) (third alteration in original).
127

•

Al-Kidd v. Ashcroft, 580 F.3d 949 (9th Cir. 2009). Al-Kidd and his wife were the subjects
of FBI surveillance as part of a broad anti-terrorism investigation allegedly aimed at Arab
and Muslim men. Id. at 952. In connection with the indictment of a different man (Sami
Oman Al-Hussayen) by a federal grand jury for visa fraud and making false statements to
U.S. officials, the U.S. Attorney’s Office submitted an application to arrest al-Kidd as a
material witness. Id. The application was supported by an affidavit executed by an FBI
agent, which asserted that al-Kidd had received “‘in excess of $20,000’” from Al-Hussayen,
that al-Kidd had “‘met with Al-Hussayen’s associates’” after returning from a trip to Yemen,
that al-Kidd had contacts with officials of the Islamic Assembly of North America (which
Al-Hussayen was affiliated with), and that “‘[d]ue to Al-Kidd’s demonstrated involvement
with the defendant . . . he is believed to be in possession of information germane to this
matter which will be crucial to the prosecution.’” Id. at 952–53 (alteration and omission in
original). The affidavit also asserted that al-Kidd was scheduled to take a one-way, first
class flight to Saudi Arabia, and that the United States government was concerned about
securing his appearance at trial if he traveled to Saudi Arabia. Id. at 953. In fact, al-Kidd
had a round-trip coach ticket to study Arabic and Islamic law on a scholarship at a Saudi
university. Id. at 952–53. Based on the affidavit, a material witness warrant was issued and
al-Kidd was arrested at the airport before he left on his trip to Saudi Arabia. Al-Kidd, 580
F.3d at 953. Al-Kidd was detained for 16 days at a variety of detention centers, transfer
centers, and jails, was allegedly strip searched on multiple occasions, confined to highsecurity units, handcuffed and shackled during transfers between facilities, only allowed out
of his cell one to two hours per day, and kept in a cell that was lit 24 hours a day. Id. After
petitioning to the court, al-Kidd was released on the conditions that he live at his in-laws’
home in Nevada, limit his travel to Nevada and three other states, report regularly to his
probation officer and consent to home visits, and give up his passport. Id. Al-Kidd allegedly
lived under these conditions for almost a year before being allowed to obtain his own
residence. Id. Three months later he was fully released at the end of Al-Hussayen’s trial.
Id. Al-Kidd was never called as a witness in the Al-Hussayen trial. Id. Al-Kidd alleged that
he separated from his wife, lost his job due to denial of security clearance from his arrest,
and was unable to find steady employment. Id. at 954.
Al-Kidd asserted that Ashcroft, as Attorney General, “developed and promulgated a policy
by which the FBI and DOJ would use the federal material witness statute as a pretext ‘to
arrest and detain terrorism suspects about whom they did not have sufficient evidence to
arrest on criminal charges but wished to hold preventatively or to investigate further.’” AlKidd, 580 F.3d at 954 (footnote omitted). Al-Kidd’s complaint relied on Ashcroft’s
statement at a press conference that: “‘Today, I am announcing several steps that we are
taking to enhance our ability to protect the United States from the threat of terrorist aliens.
These measures form one part of the department’s strategy to prevent terrorist attacks by
taking suspected terrorists off the street . . . Aggressive detention of lawbreakers and
material witnesses is vital to preventing, disrupting or delaying new attacks.’” Id. (omission
in original) (citation omitted) (emphasis added in complaint). The complaint also cited
internal Department of Justice (DOJ) memoranda quoted in a report by the DOJ’s Office of
the Inspector General and public statements of DOJ and White House officials stating that
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suspects were held under material witness warrants to investigate the suspects. Id. at
954–55. The complaint also alleged “that the policies designed and promulgated by
Ashcroft ha[d] caused individuals to be ‘impermissibly arrested and detained as material
witnesses even though there was no reason to believe it would have been impracticable to
secure their testimony voluntarily or by subpoena,’ in violation of the terms of § 3144.” Id.
at 955. The complaint also cited FBI Director Robert Mueller’s statements, made in
testimony before Congress, that listed “‘major successes’ in the FBI’s efforts toward
‘identifying and dismantling terrorist networks,’” including the arrest of al-Kidd. Id.
Finally, the complaint alleged a policy of mistreatment of material witnesses and that
Ashcroft “‘knew or reasonably should have known of the unlawful, excessive, and punitive
manner in which the federal material witness statute was being used,’ and that such manner
‘would also foreseeably subject’ detainees ‘to unreasonable and unlawful use of force, to
unconstitutional conditions of confinement, and to punishment without due process.’” Id.
Al-Kidd sued, among others, Ashcroft, the United States, the FBI agents named in the
affidavit used to support Al-Kidd’s arrest, and government agencies and officers in their
official capacities. Al-Kidd, 580 F.3d at 955. The complaint sought damages under Bivens
v. Six Unknown Named Agents of Federal Bureau of Narcotics, 403 U.S. 388, 397 (1971),
alleging violations of al-Kidd’s Fourth and Fifth Amendment rights, and alleging a direct
violation of the material witness statute. Id. at 956. The district court denied Ashcroft’s
Rule 12(b)(2) motion, finding that there were sufficient facts to establish personal
jurisdiction over Ashcroft in Idaho, and denied Ashcroft’s Rule 12(b)(6) motion, rejecting
claims of absolute and qualified immunity. Id. Ashcroft appealed, and the Ninth Circuit
affirmed in part and reversed in part.
In denying Ashcroft’s claim of absolute prosecutorial immunity, the Ninth Circuit stated:
We hold, therefore, that when a prosecutor seeks a material
witness warrant in order to investigate or preemptively detain a
suspect, rather than to secure his testimony at another’s trial, the
prosecutor is entitled at most to qualified, rather than absolute,
immunity. We emphasize that our holding here does not rest upon an
unadorned assertion of secret, unprovable motive, as the dissent
seems to imply. Even before the Supreme Court’s decision in Bell
Atlantic v. Twombly and Ashcroft v. Iqbal, it was likely that
conclusory allegations of motive, without more, would not have been
enough to survive a motion to dismiss. See, e.g., Sprewell v. Golden
State Warriors, 266 F.3d 979, 988 (9th Cir. 2001) (facts pled must be
accepted as true, but conclusory allegations need not be). Twombly’s
general requirement that “[f]actual allegations must be enough to
raise a right to relief above the speculative level,” 550 U.S. 555,
applies with equal force to allegations that a prosecutor’s actions
served an investigatory function. In this case, however, al-Kidd has
averred ample facts to render plausible the allegation of an
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investigatory function . . . .
Id. at 963 (emphasis added) (alteration in original) (footnote omitted).
In analyzing Ashcroft’s claim of qualified immunity with respect to the alleged Fourth
Amendment violations, the Ninth Circuit concluded that al-Kidd had adequately pled
violations of his Fourth Amendment rights:
Al-Kidd alleges that he was arrested without probable cause
pursuant to a general policy, designed and implemented by Ashcroft,
whose programmatic purpose was not to secure testimony, but to
investigate those detained. Assuming that allegation to be true, he
has alleged a constitutional violation. Contrary to the dissent’s
alarmist claims, we are not probing into the minds of individual
officers at the scene; instead, we are inquiring into the programmatic
purpose of a general policy . . . , and finding that the purpose of the
policy alleged in al-Kidd’s first amended complaint is impermissible
under the Fourth Amendment.
Id. at 969. The Ninth Circuit concluded that “al-Kidd’s right not to be arrested as a material
witness in order to be investigated or preemptively detained was clearly established in
2003.” Id. at 973.
In considering the alleged violation of the material witness statute, the Ninth Circuit
discussed the plausibility standard set out in Twombly and extended by Iqbal:
Prior to Bell Atlantic Company v. Twombly, 550 U.S. 544, 127
S. Ct. 1955, 167 L. Ed. 2d 929, we held that a plaintiff “does not need
to show with great specificity how each defendant contributed to the
violation of his constitutional rights. Rather, he must state the
allegations generally so as to provide notice to the defendants and
alert the court as to what conduct violated clearly established law.”
Ashcroft argues that al-Kidd’s allegations as to Ashcroft’s personal
involvement in the § 3144 Claim amount simply to “sheer
speculation,” and are insufficient to state a claim under Twombly.
In Twombly, the Supreme Court held that an allegation of
parallel conduct by competitors, without more, does not suffice to
plead an antitrust violation under 15 U.S.C. § 1. While the Court
expressly disclaimed any intention to require general “heightened fact
pleading of specifics,” and reaffirmed the holding of Swierkiewicz v.
Sorema N.A., 534 U.S. 506, 122 S. Ct. 992, 152 L. Ed. 2d 1 (2002)
(rejecting a fact pleading requirement for Title VII employment
discrimination), it stated that, to avoid dismissal under Federal Rule
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of Civil Procedure 12(b)(6), a plaintiff must aver “enough facts to
state a claim to relief that is plausible on its face.”
Since the argument and initial briefing in this case, the
Supreme Court, in Ashcroft v. Iqbal, --- U.S. ----, 129 S. Ct. 1937,
173 L. Ed. 2d 868 (2009), has clarified Twombly’s reach to cases
such as these. Iqbal concerned claims against a number of
defendants, including FBI Director Mueller and Attorney General
Ashcroft, made by Javaid Iqbal, a Muslim Pakistani who was part of
the mass roundup of Muslim aliens on immigration charges following
the September 11 attacks. Iqbal claimed that Mueller and Ashcroft
were responsible for selectively placing detainees in their restrictive
conditions on account of their race and religion. The Supreme Court
found the allegations in the complaint insufficient to state a
discrimination claim under the above-discussed Twombly
“plausibility” standard. The Court held that a pleading “that offers
‘labels and conclusions’ or ‘a formulaic recitation of the elements of
a cause of action’” is insufficient to state a claim under Rule 8 of the
Federal Rules of Civil Procedure.
Al-Kidd, 580 F.3d at 974 (internal citations omitted). The court found that unlike the
complaint in Iqbal, al-Kidd’s complaint alleged sufficient facts for his claim alleging
violation of the material witness statute to survive:
In reviewing the complaint in Iqbal, the Court noted that the
complaint did not contain any factual allegations claiming that
Mueller or Ashcroft may have intentionally discriminated on the
basis of race or religion. The Court concluded that bare assertions
regarding an invidious policy were not entitled to the assumption of
truth because they amounted to “nothing more than a ‘formulaic
recitation of the elements’ of a constitutional discrimination claim.”
The Court noted that the alleged facts, even if accepted as true, were
more compatible on their face with lawful conduct.
Here, unlike Iqbal’s allegations, al-Kidd’s complaint
“plausibly suggest[s]” unlawful conduct, and does more than contain
bare allegations of an impermissible policy. While the complaint
similarly alleges that Ashcroft is the “principal architect” of the
policy, the complaint in this case contains specific statements that
Ashcroft himself made regarding the post-September 11th use of the
material witness statute. Ashcroft stated that enhanced tactics, such
as the use of the material witness statute, “form one part of the
department’s concentrated strategy to prevent terrorist attacks by
taking suspected terrorists off the street,” and that “[a]ggressive
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detention of lawbreakers and material witnesses is vital to preventing,
disrupting or delaying new attacks.” Other top DOJ officials
candidly admitted that the material witness statute was viewed as an
important “investigative tool” where they could obtain “evidence”
about the witness. The complaint also contains reference to
congressional testimony from FBI Director Mueller, stating that
al-Kidd’s arrest was one of the government’s anti-terrorism
successes—without any caveat that al-Kidd was arrested only as a
witness. Comparatively, Iqbal’s complaint contained no factual
allegations detailing statements made by Mueller and Ashcroft
regarding discrimination. The specific allegations in al-Kidd’s
complaint plausibly suggest something more than just bare
allegations of improper purpose; they demonstrate that the Attorney
General purposefully used the material witness statute to detain
suspects whom he wished to investigate and detain preventatively,
and that al-Kidd was subjected to this policy.
Further, unlike in Twombly and Iqbal, where the plaintiffs
alleged a conspiracy or discriminatory practice in the most
conclusory terms, al-Kidd does not rely solely on his assertion that
Ashcroft ordered, encouraged, or permitted “policies and practices
[whereby] individuals have also been impermissibly arrested and
detained as material witnesses even though there was no reason to
believe it would have been [im]practicable to secure their testimony
voluntarily or by subpoena.” His complaint notes “one account” of
material witness practices stating that “nearly fifty percent of those
detained in connection with post-9/11 terrorism investigations were
not called to testify.” In a declaration filed in another proceeding
well before al-Kidd’s arrest, a DOJ official admitted that, of those
detained as material witnesses, “it may turn out that these individuals
have no information useful to the investigation.”
Id. at 974–75 (first, second, and third alterations in original) (internal citations and footnote
omitted). The court concluded that the complaint did not merely contain bare allegations
that Ashcroft knew of the policy, but instead contained “allegations that plausibly
suggest[ed] that Ashcroft purposely instructed his subordinates to bypass the plain reading
of the statute,” and that the allegations “clearly ‘nudge[d]’ al-Kidd’s claim of illegality
‘across the line from conceivable to plausible.’” Id. at 976 (quoting Iqbal, 129 S. Ct. at
1952). The court explained that the facts pleaded were more than sufficient to support the
claim of illegal use of the material witness statute:
[A]l-Kidd pleads facts that go much further than merely showing that
he was detained under the material witness statute and did not testify.
The pleadings show that Ashcroft explicitly stated that enhanced
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techniques such as the use of the material witness statute “form one
part of the department’s concentrated strategy to prevent terrorist
attacks by taking suspected terrorists off the street.” Other top DOJ
officials stated that the material witness statute was viewed as an
important “investigative tool,” and that al-Kidd’s arrest was touted as
one of the government’s anti-terrorism successes, without any
mention that he was being held as a material witness. We disagree
with the dissent, and hold that al-Kidd has plead[ed] that Ashcroft’s
“concerted strategy” of misusing the material witness statute
plausibly led to al-Kidd’s detention.
Id. at 977. The Ninth Circuit did note that “[p]ost-Twombly, plaintiffs face a higher burden
of pleading facts, and courts face greater uncertainty in evaluating complaints,” explaining
that Rule 8 “‘does not unlock the doors of discovery for a plaintiff armed with nothing more
than conclusions,’” id. (quoting Iqbal, 129 S. Ct. at 1950), and that “[t]his concern applie[s]
with great force in the civil rights context, where ‘[t]he basic thrust of the qualifiedimmunity doctrine is to free officials from the concerns of litigation, including ‘avoidance
of disruptive discovery,’” id. (third alteration in original) (quoting Iqbal, 129 S. Ct. at 1953),
but concluded that “al-Kidd has met his burden of pleading a claim for relief that is
plausible, and that his suit on the § 3144 claim should be allowed to proceed,” al-Kidd, 580
F.3d at 977 (citing Iqbal, 129 S. Ct. at 1950). The court emphasized that the result might
different on summary judgment:
Twombly and Iqbal do not require that the complaint include all facts
necessary to carry the plaintiff’s burden. “Asking for plausible
grounds to infer” the existence of a claim for relief “does not impose
a probability requirement at the pleading stage; it simply calls for
enough fact to raise a reasonable expectation that discovery will
reveal evidence” to prove that claim. Twombly, 550 U.S. at 556, 127
S. Ct. 1955. In this case, we hold that al-Kidd has pled “enough facts
to state a claim to relief that is plausible on its face.” Id. at 570.
Id.
With respect to al-Kidd’s claim that he was mistreated while confined, the court concluded
that the claim failed because it contained only conclusory allegations, similar to those
rejected in Iqbal. The court explained:
[A]l-Kidd claims here that Ashcroft promulgated and approved the
unlawful policy which caused al-Kidd “to be subjected to prolonged,
excessive, punitive, harsh, unreasonable detention or post-release
conditions.” Contrary to the § 3144 claim, however, the complaint
does not allege any specific facts—such as statements from Ashcroft
or from high ranking officials in the DOJ—establishing that Ashcroft
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had personal involvement in setting the conditions of confinement.
Id. at 978. Although the complaint alleged that media reports and courts had noted the harsh
conditions of confinement for material witnesses, the Ninth Circuit found that “[w]hile it is
possible that these reports were sufficient to put Ashcroft on notice by spring of 2003 that
there was a systemic problem at the DOJ with respect to its treatment of material witnesses,
the non-specific allegations in the complaint regarding Ashcroft’s involvement fail to nudge
the possible to the plausible, as required by Twombly.” Id. at 978–79. The court
differentiated the pleadings with respect to the material witness statute, stating that “[u]nlike
the § 3144 Claim, which specifically avers facts which could sustain the inference that
Ashcroft ‘set[ ] in motion a series of acts by others which the actor knows or reasonably
should know would cause others to inflict the constitutional injury’ regarding the illegal use
of the material witness statute, the complaint’s more conclusory allegations regarding
Ashcroft’s involvement in settling the harsh conditions of confinement (which are very
similar to the allegations in Iqbal), are deficient under Rule 8.” Id. at 979 (alteration in
original) (internal citation omitted). The Ninth Circuit held that “al-Kidd ha[d] not alleged
adequate facts to render plausible Ashcroft’s personal involvement in setting the harsh
conditions of his confinement, and ha[d] therefore failed to state a claim for which relief
c[ould] be granted.” Id.
Judge Bea concurred in part and dissented in part. Judge Bea would have held that qualified
immunity protected Ashcroft from al-Kidd’s claim of constitutional violations because there
was no Fourth Amendment violation, and even if there was, “al-Kidd’s right not to be
arrested on an objectively valid, but pretextual arrest warrant was not ‘clearly established’
in March 2003 . . . .” Al-Kidd, 580 F.3d at 983 (Bea, J., dissenting). With respect to alKidd’s claim that his detention violated the Fourth Amendment and the terms of the material
witness statute because of material misrepresentations and omissions in the affidavit
supporting the warrant application, Judge Bea would have held that “as with his claim that
Ashcroft is liable for the claimed wretched conditions of al-Kidd’s confinement, as to which
all of us agree his claim fails—al-Kidd has failed to allege facts sufficient to establish
Ashcroft’s personal liability for such conduct.” Id. (citing Iqbal, 129 S. Ct. 1937).
•

Delta Mech., Inc. v. Garden City Group, Inc., No. 08-15429, 2009 WL 2610796 (9th Cir.
Aug. 26, 2009) (unpublished memorandum). The district court dismissed the plaintiff’s
complaint because it found that the plaintiff was not a third-party beneficiary to a settlement
agreement, and therefore was not entitled to bring a lawsuit for alleged breach of that
agreement. Id. at *1. The Ninth Circuit found this to be error because “[t]he evidentiary
record on this issue [of whether the plaintiff was a third-party beneficiary] demonstrate[d]
at this early stage of the case that whether Delta was or was not a third-party beneficiary
[wa]s a genuine issue of material fact that might survive summary judgment.” Id. The Ninth
Circuit held that “[t]he factual content of the complaint and reasonable inferences therefrom
[we]re plausibly suggestive of a claim entitling Delta to relief.” Id. (citing Moss v. U.S.
Secret Serv., No. 07-36108, 2009 WL 2052985, at *1–2 (9th Cir. July 16, 2009) (citing
Twombly, 550 U.S. 544)).
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Judge Ikuta dissented, stating that Iqbal requires applying a two-step process of identifying
conclusions in the pleadings that are not entitled to an assumption of truth and then
considering whether the factual allegations plausibly suggest entitlement to relief, and that
under that test, there were not sufficient facts alleged to survive a motion to dismiss. Id. at
*3 (Ikuta, J., dissenting) (citing Iqbal, 129 S. Ct. at 1950, 1951). Judge Ikuta elaborated:
Setting aside Delta’s conclusory legal allegation that it is an
intended third-party beneficiary of the Class Action Settlement
Agreement, the essence of Delta’s factual allegations is that 1)
defendants failed to issue certificates to eligible class members, 2)
such failure was a breach of the Settlement Agreement, and 3) as a
result, Delta was not compensated. See Settlement Agreement,
Section 8.2.3. Because Delta does not allege that the Settling
Defendants agreed in the Settlement Agreement to incur an obligation
to Delta, the complaint’s factual allegations do not allow the court to
draw the reasonable inference that Delta was an intended third-party
beneficiary of the Settlement Agreement or that the defendants are
liable to Delta for a breach of that agreement. The language in
Section 8 of the Settlement Agreement quoted by the majority does
not “plausibly give rise to an entitlement to relief.” Iqbal, 129 S. Ct.
at 1950. Accordingly, the district court did not err in dismissing
Delta’s complaint.
Id. at *3.
•

Moss v. U.S. Secret Serv., 572 F.3d 962 (9th Cir. 2009). The plaintiffs alleged that two
Secret Service Agents violated their First Amendment rights by ordering that a
demonstration critical of then President George W. Bush be relocated. Id. at 964. The
plaintiffs sued under Bivens, alleging violations of their First, Fourth, and Fifth Amendment
rights. According to the complaint, anti-Bush protesters assembled in front of an inn where
President Bush was expected to visit, and just before the President’s arrival, state and local
police cleared the alleyway behind the inn and began restricting the movements of some of
the demonstrators. Id. at 965. The complaint alleged that at the same time, police allowed
hotel guests and diners to remain inside the inn without conducting a security screening. Id.
A pro-Bush demonstration assembled one block west of the anti-Bush demonstration and one
block immediately west of the inn. Id. The Secret Service Agents allegedly directed state
and local law enforcement to clear the street in front of the inn—where the plaintiffs were
protesting—and move the people in that area east of the street on the east side of the inn.
See id. The Agents stated that this was to ensure that nobody came within handgun or
explosive range of the President. Id. The anti-Bush demonstrators were pushed by state and
local police to the east side of Fifth Street, more than a block away from the inn (and farther
than instructed by the Agents). See id. The plaintiffs alleged that the police used violent
means to move the demonstrators, and that the pro-Bush demonstration continued without
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disruption. Moss, 572 F.3d at 965–66. The plaintiffs alleged that “the Agents’ treatment of
the anti-Bush demonstration in Jacksonville was but one instance of an officially authorized,
sub rosa Secret Service policy,” and that the Secret Service’s guidelines and rules
prohibiting discrimination based on protestors’ views was an attempt to hide the actual
policy from review. Id. at 966. The defendants moved to dismiss on the basis of qualified
immunity, but the district court denied their motion to dismiss and the defendants filed an
interlocutory appeal. The Ninth Circuit affirmed the dismissal, but remanded to permit the
plaintiffs to replead to comply with Twombly and Iqbal.
The Ninth Circuit first discussed “recent developments in the Supreme Court’s pleading
jurisprudence, first in Twombly, then the Court’s clarification of that holding in Iqbal.” Id.
at 968. The court explained that in Twombly, “[t]he Court cautioned that it was not outright
overruling Conley v. Gibson, the foundational ‘notice pleading’ case construing Federal
Rule of Civil Procedure 8(a)(2), but explained that Conley’s oft-cited maxim that ‘a
complaint should not be dismissed for failure to state a claim unless it appears beyond doubt
that the plaintiff can prove no set of facts in support of his claim which would entitle him to
relief, read literally, set the bar too low.” Id. (emphasis added) (footnote and internal
citation omitted). Under these principles, the Ninth Circuit framed the question before it to
be “whether Plaintiffs’ allegation that the Agents ordered the relocation of their
demonstration because of its anti-Bush message is plausible, not merely possible.” Id. at
970. The Ninth Circuit explained the two-step process set out in Iqbal, and used that process
to evaluate the complaint. See id.
The court concluded that several of the allegations were conclusory and not entitled to a
presumption of truth, including the allegation of the Agents’ impermissible motive, the
allegation that “the Agents acted in conformity with an officially authorized sub rosa Secret
Service policy of suppressing speech critical of the President,” and the allegation of
systematic viewpoint discrimination. Moss, 572 F.3d at 970. The court explained that “[t]he
allegation of systematic viewpoint discrimination at the highest levels of the Secret Service,
without any factual content to bolster it, is just the sort of conclusory allegation that the Iqbal
Court deemed inadequate, and thus does nothing to enhance the plausibility of Plaintiffs’
viewpoint discrimination claim against the Agents.” Id. Turning to the factual allegations,
the Ninth Circuit noted that the plaintiff had pleaded that the Agents ordered the relocation
of the anti-Bush demonstrators but not of the pro-Bush demonstrators, and that the guests
in the inn were not subjected to security screening or asked to leave, despite their proximity
to the President. Id. at 971. The court found that these assertions did not amount to a
plausible claim:
The complaint alleges that the Agents instructed state and
local police to move “all persons” between Third and Fourth streets
to the east side of Fourth Street, a position roughly the same distance
from the Inn’s patio dining area as the Pro-Bush demonstration, and
that in issuing that order, the Agents explained their desire to ensure
that no protesters remained in handgun or explosive range of the
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President. If the Agents’ motive in moving Plaintiffs away from the
Inn was—contrary to the explanation they provided to state and local
police—suppression of Plaintiffs’ anti-Bush message, then
presumably, they would have ensured that demonstrators were moved
to an area where the President could not hear their demonstration, or
at least to an area farther from the Inn then the position that the
pro-Bush demonstrators occupied. Instead, according to the
complaint, the Agents simply instructed state and local police to
move the anti-Bush protestors to a location situated a comparable
distance from the Inn as the other demonstrators, thereby
establishing a consistent perimeter around the President. This is not
a plausible allegation of disparate treatment.
Plaintiffs allege that they were ultimately driven more than
three blocks away from the Inn, surrounded, and subjected to abusive
police tactics, but nowhere does their complaint allege, or even
imply, that [the Secret Service Agents] had anything to do with how
the local police carried out the initial order. Without any allegation
tying the Agents to the actions of the local police, we may not assume
that either did anything beyond ordering Plaintiffs moved to the east
side of Fourth Street. See Sprewell v. Golden State Warriors, 266
F.3d 979, 988 (9th Cir. 2001) (stating that courts are not required to
make “unreasonable inferences” or “unwarranted deductions of fact”
to save a complaint from a motion to dismiss).
Plaintiffs’ allegation that the diners and guests inside the Inn
were allowed to remain in close proximity to the President without
security screening does not push their viewpoint discrimination claim
into the realm of the plausible. Again, the crux of Plaintiffs’
complaint is that the differential treatment of similarly situated
pro-Bush and anti-Bush demonstrators reveals that the Agents had an
impermissible motive—suppressing Plaintiffs’ anti-Bush viewpoint.
The differential treatment of diners and guests in the Inn, who did not
engage in expressive activity of any kind and were not located in the
public areas outside of the Inn, however, offers little if any support
for such an inference. See Menotti v. City of Seattle, 409 F.3d 1113,
1130 (9th Cir. 2005) (holding that security zone exceptions
permitting shoppers and employees, but not protestors, to enter a
restricted area did not amount to discrimination on the basis of
viewpoint because the two groups were not similarly situated).
We conclude that Plaintiffs’ complaint fails to plead facts
plausibly suggesting a colorable Bivens claim against the Agents.
The facts do not rule out the possibility of viewpoint discrimination,
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and thus at some level they are consistent with a viable First
Amendment claim, but mere possibility is not enough. The factual
content contained within the complaint does not allow us to
reasonably infer that the Agents ordered the relocation of Plaintiffs’
demonstration because of its anti-Bush message, and it therefore fails
to satisfy Twombly and Iqbal.
Id. at 971–72 (emphasis added) (original emphasis and internal record citations omitted).
Although the Ninth Circuit concluded that the complaint was insufficient, it held that the
plaintiffs should have the opportunity to amend their complaint, noting that pleading
standards had recently changed. The court explained that:
Prior to Twombly, a complaint would not be found deficient if it
alleged a set of facts consistent with a claim entitling the plaintiff to
relief. See Conley, 355 U.S. at 45–46, 78 S. Ct. 99. Under the
Court’s latest pleadings cases, however, the facts alleged in a
complaint must state a claim that is plausible on its face. As many
have noted, this is a significant change, with broad-reaching
implications. See, e.g., A. Benjamin Spencer, Plausibility Pleading,
49 B.C. L. REV. 431, 433 (2008) (characterizing Twombly as an
abrupt and significant departure from the long-standing tradition of
liberal notice pleading in the federal courts). Having initiated the
present lawsuit without the benefit of the Court’s latest
pronouncements on pleadings, Plaintiffs deserve a chance to
supplement their complaint with factual content in the manner that
Twombly and Iqbal require.
Id. at 972.

Tenth Circuit
•
Hall v. Witteman, 584 F.3d 859 (10th Cir. 2009). The plaintiff alleged that his rights were
violated when he paid a local newspaper to run an advertisement opposing the election of
a local judge twice, but the newspaper only ran the advertisement once. Id. at 862. Instead
of running the plaintiff’s ad a second time, the newspaper ran an ad supporting the judge (the
“Responsive Ad”), paid for by a group of attorneys, including the county’s attorney general
(Witteman). Id. The plaintiff’s suit asserted claims against the newspaper, the judge, the
attorneys submitting the Responsive Ad, and a few others. Id. The complaint asserted
claims under sections 1983 and 1985 and federal RICO, as well as state law claims. Id.
“The heart of the allegations in the complaint’s 153 paragraphs [wa]s that after Mr. Hall
placed his advertisement, the defendants unlawfully convinced the paper’s publisher to pull
the second running of his advertisement in favor of their own, which contained defamatory
remarks about him.” Id. The plaintiff alleged that the defendant’s actions violated his free
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speech rights under the First Amendment, as applied to the states through the Fourteenth
Amendment, and his Fourteenth Amendment right to equal protection. Hall, 584 F.3d at
862. The district court dismissed the federal claims for failure to state a claim, denied leave
to amend, and declined to exercise supplemental jurisdiction over the state-law claims.” Id.
The Tenth Circuit affirmed, finding that the “civil-rights claims fail[ed] because [the
plaintiff] did not allege state action, and [the] RICO claims fail[ed] because he did not allege
a threat of continuing racketeering activity.” Id.
With respect to the section 1983 claim, the court noted that a plaintiff must “‘show that the
alleged deprivation [of rights secured by the Constitution and the laws of the United States]
was committed by a person acting under color of state law,’” and that “[i]n the context of §
1983 claims based on violations of the Fourteenth Amendment, . . . the under-color-of-statelaw requirement in § 1983 is equivalent to the Fourteenth Amendment’s state-action
requirement.” Id. at 864. The court noted that “Mr. Hall appear[ed] to concede that his §
1983 claim depend[ed] entirely on Mr. Witteman’s involvement in the defendant’s actions.”
Id. The court found that the relevant allegations “fail[ed] to describe any use of
governmental power by Mr. Witteman (or anyone else), and that “[a]ll the complaint
contain[ed] in that regard [we]re conclusory allegations, such as ‘Defendant[s] decided to
use the power of Witteman’s Kansas State Office as Coffey County Attorney,’ and
‘Witteman using and misusing the power of his offices . . . , impermissibly interfering with
Plaintiff’s right to publish a second time . . . .’” Id. at 865 (omissions and fifth alteration in
original) (internal record citations omitted). The court emphasized that “the paragraph of
the complaint alleging how the defendants ‘coerced’ the newspaper (through defendant
Faimon, apparently the editor or publisher) not to run Mr. Hall’s second ad does not include
any allegation of abuse of the power of Mr. Witteman’s government position.” Hall, 584
F.3d at 865. The court explained that “Mr. Hall’s essential concern about Mr. Witteman’s
official position [wa]s not that Mr. Witteman was exercising any of his official powers, but
that his official title gave him prestige that would influence voters reading the Responsive
Ad,” and that “[t]his is not the stuff of which state action is made.” Id. at 866. The court
concluded that the complaint did not allege state action:
In the case before us, there is no allegation of any act by Mr.
Witteman in which he abused, or even used, any power that he
possessed by virtue of state law. In particular, there is no allegation
that he threatened or hinted at any possibility of his future action as
county attorney if The Republican ran Mr. Hall’s second ad or did
not run the Responsive Ad. Mr. Hall’s complaint does allege that the
Responsive Ad had particular clout because a voter would believe
that “‘if Doug (Witteman) our County Attorney thinks [the judge] is
ok, that is good enough for me to vote for Fromme also.” But this is
not a claim of use of state power. Exploiting the personal prestige of
one’s public position is not state action absent at least some
suggestion that the holder would exercise governmental power. No
reader of the Responsive Ad could reasonably believe that Mr.
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Witteman was threatening to use the power of his office against those
who did not vote for [the judge].
Id. at 866–67 (internal citations omitted). The court concluded that the section 1985 claim
“suffer[ed] from the same defect as his § 1983 claim in that § 1985(3) d[id] not offer
protection against the type of private conspiracy alleged in [the] complaint.” Id. at 1987
(citations omitted). The court held that “[l]ike his § 1983 claim, Mr. Hall’s § 1985 claim
fail[ed] because of the absence of well-pleaded factual allegations that Mr. Witteman’s
alleged misconduct was state action.” Id.
With respect to the RICO claim, the court held that the complaint did “not adequately allege
a ‘pattern’ of racketeering activity because it fail[ed] to allege sufficient continuity to sustain
a RICO claim.” Id. The court agreed with the district court’s analysis:
At best, what plaintiff alleges is a closed-ended series of predicate
acts constituting a single scheme to accomplish a discrete goal
[publication of the Responsive Advertisement in lieu of Plaintiff’s
Advertisement] directed at only one individual [the plaintiff] with no
potential to extend to other persons or entities.
Id. at 867–68 (alterations in original) (quoting the district court) (quotation marks omitted).
The Tenth Circuit found no abuse of discretion in the district court’s denial of leave to
amend because the plaintiff failed to attach a proposed amendment and “nowhere explained
how a proposed amendment would cure the deficiencies identified by the distrinct court,”
and because district courts are not required “‘to engage in independent research or read the
minds of litigants to determine if information justifying an amendment exists.’” Id. at 868
(citation omitted).

Eleventh Circuit
•
Waters Edge Living, LLC v. RSUI Indemnity Co., No. 08-16847, 2009 WL 4366031 (11th
Cir. Dec. 3, 2009) (unpublished) (per curiam). The lawsuit involved a dispute between
competing claimants to an insurance policy. Id. at *1. Plaintiff Waters Edge had purchased
an apartment complex from a real estate trust controlled by Prime Income Asset
Management, Inc. (“Prime”), and as part of the deal, Prime agreed that the property would
remain covered for Waters Edge’s benefit under Prime’s master property insurance policy
for nine months. Id. The master policy had a primary policy with a $10 million limit and
two layers of excess coverage, one with a $10 million limit and a second with an $80 million
limit provided by defendant RSUI. Id. Hurricane Katrina destroyed the apartments that
Waters Edge had bought as well as Prime’s covered properties in Louisiana, which were
valued at more than the $100 million policy limit. Id. The primary insurer paid the policy
limit to Prime, which in turn paid Waters Edge $1.8 million for the value of Waters Edge’s
lost rents. Id. Waters Edge attempted to recover the remainder of its losses from RSUI, and
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it was determined that Waters Edge’s property loss was approximately $30.9 million.
Waters Edge Living, 2009 WL 4366031, at *1. The complaint alleged that through a series
of communications, RSUI’s adjuster agreed to pay the $30.9 million, “subject to policy
provisions.” Id. at *2. Prime became concerned that it would not be able to recover for its
losses because the policy limit was insufficient to cover the damage at all of the covered
properties. Id. “Prime insisted that only it could receive payment under the terms of the
RSUI policy and that it would therefore have to sign off as the policyholder on any payments
made to Waters Edge.” Id. Meanwhile, the first excess insurer paid the full $10 million
limit to Prime, and Waters Edge then sued RSUI. Id. Because it was receiving conflicting
claims from Prime and Waters Edge, RSUI sent one check to Waters Edge for the agreed
$30.9 million less the $1 million policy deductible and a second check to cover Waters
Edge’s lost rents. Id. Both checks included Prime as a co-payee, and because Prime would
not sign off on the payments, Waters Edge could not receive the proceeds. Waters Edge
Living, 2009 WL 4366031, at *2. The parties agreed to place the funds in a custodial fund
until an agreement could be reached, but RSUI continued to pay Prime for its losses, which
eventually left only $17,582,939 of the policy proceeds, which RSUI deposited into the
custodial account. Id. RSUI then filed counterclaims interpleading the funds in the custodial
account. Id. Waters Edge and Prime agreed to settle the interpleader claim, with Waters
Edge receiving $24 million and Prime receiving the remainder of the custodial account,
leaving Waters Edge with approximately $6 million less than RSUI had agreed to pay to
Waters Edge. Id. Waters Edge reserved its claims against RSUI, and the complaint asserted
claims for: “(1) breach of a settlement agreement; (2) failure to timely pay a settled loss in
violation of the Texas Insurance Code; (3) breach of the duty of good faith; and (4)
misrepresentation.” Id. at *3.
With respect to the breach of a settlement agreement claim, the complaint alleged that the
communications between the RSUI adjuster and Waters Edge resulted in a binding
settlement agreement in which RSUI agreed to pay Waters Edge $29.9 million, which
included the property loss less the deductible. Id. “Waters Edge claim[ed] that RSUI
breached this settlement agreement when it included Prime as a co-payee on the checks
tendered to Waters Edge, effectively stopping Waters Edge from receiving the settlement
proceeds.” Waters Edge Living, 2009 WL 4366031, at *4. The Eleventh Circuit concluded
that this claim was sufficiently pleaded:
The district court erred when it dismissed Count I of the
complaint because Count I states a claim to relief that is plausible on
its face. See Iqbal, --- U.S. ----, 129 S. Ct. at 1949. The factual
content of the complaint, particularly the alleged exchange between
Waters Edge and RSUI’s adjuster, allows a reasonable inference that
the parties reached a settlement agreement creating a contractual
obligation independent of the policy. See id. It does not compel that
inference, but it does allow a reasonable factfinder to draw the
inference. If the factfinder does draw the inference, RSUI breached
the independent agreement when it included Prime as a co-payee on
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the checks tendered to Waters Edge. Because Count I states a
facially plausible claim for relief, the district court erred when it
dismissed Count I for failure to state a claim on which relief can be
granted.
Id.
With respect to the claim under the Texas Insurance Code, the district court dismissed the
claim because it concluded that “Waters Edge had failed to plead factual allegations
plausibly supporting the existence of a binding settlement agreement between RSUI and
Waters Edge.” Id. The Eleventh Circuit had already disagreed with that assessment in
connection with the first claim, and held that “[b]ecause Waters Edge alleged that it entered
a binding settlement agreement with RSUI and that RSUI did not make payment as required
by that agreement, Waters Edge pleaded facts sufficient to state a claim for relief that [wa]s
plausible on its face based on RSUI’s failure to make timely payment of a settled loss.” Id.
(citing Iqbal, 129 S. Ct. at 1949).
The Eleventh Circuit found that the claim for breach of the duty of good faith was not
adequately pleaded:
Count III alleges that RSUI breached its duty of good faith by
improperly including Prime as a co-payee on the checks tendered to
Waters Edge and by “skipping over [Waters Edge’s] settled loss to
pay Prime’s unsettled losses, including amounts that were not and
could never be due.” Even viewed in the light most favorable to
Waters Edge, the factual allegations in the complaint do not state a
facially plausible claim of breach of the duty of good faith. The
allegations that RSUI gave in to Prime’s demand that it withhold
payment to Waters Edge “in deference to its business relation with
Prime” and that “RSUI treated [Waters Edge] unfairly, unreasonably
preferring Prime among its coinsureds” are nothing more than
conclusory statements. Under Iqbal, “naked assertions devoid of
further factual enhancement” are not enough to overcome a Rule
12(b)(6) motion to dismiss. Iqbal, --- U.S. ----, 129 S. Ct. at 1949
(quotation marks and citation omitted).
Id. (alterations in original). The court explained that “[i]f you t[ook] out the labels,
conclusions, and formulaic recitations, the factual allegations contained in the complaint
actually indicate[d] that RSUI acted in good faith.” Id. at *5 (internal citation to Iqbal
omitted). The court stated that “[w]hile Waters Edge ha[d] stated a claim that RSUI
breached the alleged independent settlement agreement, it ha[d] not pleaded factual
allegations sufficient to allow [the court] to draw a reasonable inference that RSUI did so
in bad faith,” and concluded that “[t]he district court properly dismissed Count III.” Waters
Edge Living, 2009 WL 4366031, at *5.
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The claim for misrepresentation alleged that “RSUI’s insurance adjuster misrepresented to
Waters Edge that Prime, as policyholder, would have to agree to any payment made to
Waters Edge and that this misrepresentation caused Waters Edge to delay its demand for
payment of the amount due under the settlement, ‘prevent[ing] them from timely realizing
the full benefit of their reasonable settlement.’” Id. (alteration in original). The Eleventh
Circuit summarily dismissed Waters Edge’s argument that it did not need to plead with
particularity under Rule 9(b), finding the argument waived, but explained that even if Rule
9(b) did not apply, Waters Edge still failed to state a claim. Id. at *5 n.2. The court cited
pre-Twombly case law and explained that “[d]espite the general leniency of pleading
requirements under the Federal Rules of Civil Procedure, ‘it is axiomatic that defendants
remain entitled to know exactly what claims are being brought against them.’” Id. at *5
(quoting Omar ex rel. Cannon v. Lindsey, 334 F.3d 1246, 1250 (11th Cir. 2003)). The court
held that “[a] sentence in the complaint alleging that RSUI violated two unnamed chapters
of the Texas Insurance Code by failing to timely pay a settled loss did not let RSUI know
that Waters Edge was bringing a claim of misrepresentation against them based on particular
provisions of the Texas Insurance Code.” Id. The court similarly rejected Waters Edge’s
argument on appeal that it had stated a claim for common law misrepresentation based on
negligence. Id. The court noted that the argument was waived, but that even without
waiver, the claim did “not state a facially plausible claim for relief.” Waters Edge Living,
2009 WL 4366031, at *6. Texas law required justifiable reliance on the misrepresentation,
but the complaint alleged that Waters Edge’s entitlement to the agreed amount was
indisputable. Id. The court explained that “[i]f Waters Edge’s entitlement to receive the
agreed amount from RSUI was so clear, Waters Edge could not have justifiably relied on the
adjuster’s statement that Prime would have to agree to allow Waters Edge to receive
payment from RSUI.” Id. The court concluded: “Because Count IV does not allow a
reasonable inference that Waters Edge justifiably relied on the adjuster’s alleged
misrepresentation, it does not state a claim of negligent misrepresentation that is plausible
on its face.” Id. (citing Iqbal, 129 S. Ct. at 1949).
•

Sinaltrainal v. Coca-Cola Co., 578 F.3d 1252 (11th Cir. 2009). The plaintiffs, who were
trade union leaders, brought suit under the Alien Tort Statute (ATS) and the Torture Victims
Protection Act (TVPA), “alleging their employers—two bottling companies in
Colombia—collaborated with Colombia paramilitary forces to murder and torture Plaintiffs.”
Id. at 1257 (footnotes omitted). The plaintiffs’ complaint named, among others, two CocaCola companies, and alleged that they were connected to the Colombian bottlers, and their
employees, through alter ego and agency relationships. Id. “The [original] complaint
alleged the systematic intimidation, kidnapping, detention, torture, and murder of Colombian
trade unionists at the hands of paramilitary forces, who allegedly worked as agents of the
Defendants.” Id. at 1258. The plaintiffs ultimately filed four separate complaints. The
plaintiffs did not allege that the defendants caused the violence, but asserted that the
defendants capitalized on the hostile environment in Colombia and conspired with
paramilitaries or local police to rid their bottling facilities of unions. Id. at 1265. The
defendants moved to dismiss under Rule 12(b)(1) for lack of subject matter jurisdiction, and
the district court ultimately dismissed all four complaints, finding that “each fell short of
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pleading the factual allegations necessary to invoke the court’s subject matter jurisdiction
under the ATS and the TVPA,” and that “the allegations in all four complaints insufficiently
pled a conspiracy between the local facilities’ management and the paramilitary officers.”
Id. at 1260.
In discussing the pleading standards, the court emphasized that “[f]actual allegations in a
complaint need not be detailed but ‘must be enough to raise a right to relief above the
speculative level on the assumption that all the allegations in the complaint are true (even
if doubtful in fact).’” Id. at 1261 (quoting Twombly, 550 U.S. at 555). The court also
explained that “in Iqbal, the Supreme Court reiterated that although Rule 8 of the Federal
Rules of Civil Procedure does not require detailed factual allegations, it does demand ‘more
than an unadorned, the-defendant-unlawfully-harmed-me accusation.’” Sinaltrainal, 578
F.3d at 1261 (quoting Iqbal, 129 S. Ct. at 1949). “The mere possibility the defendant acted
unlawfully is insufficient to survive a motion to dismiss.” Id. (citing Iqbal, 129 S. Ct. at
1949).
“For subject matter jurisdiction to entertain Plaintiffs’ ATS claims, the complaints must
sufficiently plead (1) the paramilitaries were state actors or were sufficiently connected to
the Colombian government so they were acting under color of law (or that the war crimes
exception to the state action requirement applies) and (2) the Defendants, or their agents,
conspired with the state actors, or those acting under color of law, in carrying out the tortious
acts.” Id. at 1266 (footnote omitted). With respect to pleading state action, the Eleventh
Circuit held that the “conclusory allegation that the paramilitary security forces acted under
color of law [wa]s not entitled to be assumed true and [wa]s insufficient to allege statesponsored action”; that “Colombia’s mere ‘registration and toleration of private security
forces d[id] not transform those forces’ acts into state acts’”; that “[a]llegations [that] the
Colombian government tolerated and permitted the paramilitary forces to exist [we]re
insufficient to plead the paramilitary forces were state actors”; and that the “naked allegation
[that] the paramilitaries were in a symbiotic relationship with the Colombian government
and thus were state actors” was conclusory and did not need to be accepted as true. Id.
(citing Iqbal, 129 S. Ct. at 1951). The court noted that there was “no suggestion the
Colombian government was involved in, much less aware of, the murder and torture alleged
in the complaints,” and held that “[t]he plaintiffs’ ‘formulaic recitation’ that the paramilitary
forces were in a symbiotic relationship and were assisted by the Colombian government,
absent any factual allegations to support this legal conclusion, [wa]s insufficient to state an
allegation of state action that [wa]s plausible on its face.” Id. (citing Iqbal, 129 S. Ct. at
1950) (internal citation omitted). For this reason, the court found that dismissal of three of
the complaints for lack of subject matter jurisdiction was appropriate.
With respect to the fourth complaint, the plaintiffs alleged a conspiracy between local police
and the bottling facility’s management. Id. at 1267. The Eleventh Circuit concluded that
the plaintiffs’ “attenuated chain of conspiracy fail[ed] to nudge their claims across the line
from conceivable to plausible,” id. at 1268 (citing Twombly, 550 U.S. at 570), explaining:

144

First, while the plaintiffs allege “Aponte’s15 plan necessarily required
the cooperation and complicity of the arresting police officers,” we
are not required to admit as true this unwarranted deduction of fact.
Second, the plaintiffs’ allegations of conspiracy are “based on
information and belief,” and fail to provide any factual content that
allows us “to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Iqbal, 129 S. Ct. at 1949.
Specifically, these plaintiffs allege “[t]he basis for the conspiracy was
either that Aponte arranged to provide payment to the officers for
their participation, or that the officers had a shared purpose with
Aponte to unlawfully arrest and detain Plaintiffs because they were
union officials and had been branded by Panamco officials as leftist
guerillas.” The premise for the conspiracy is alleged to be either
payment of money or a shared ideology. The vague and conclusory
nature of these allegations is insufficient to state a claim for relief,
and “will not do.” Twombly, 550 U.S. at 555, 127 S. Ct. at 1965.
Furthermore, the complaint fails to allege when or with whom
Aponte entered into a conspiracy to arrest, detain, and harm the
plaintiffs. The scope of the conspiracy and its participants are
undefined. There are no allegations the treatment the plaintiffs
received at the hands of the local police and in prison was within the
scope of the conspiracy. Additionally, assuming Aponte even
conspired with the local police to arrest the plaintiffs, this action
alone is insufficient to form the basis of an ATS claim, and there is
no allegation the subsequent six-month imprisonment and
mistreatment was part of the conspiracy. The Garcia plaintiffs, thus,
fail to state a plausible claim for relief against the Panamco
Defendants for a violation of the law of nations. See 28 U.S.C. §
1350. We conclude the district court did not err in dismissing the
ATS claims in the Garcia complaint for lack of subject matter
jurisdiction.
Sinaltrainal, 578 F.3d at 1268–69 (alteration in original) (internal citation omitted).
The plaintiffs alleged the same facts with respect to their TVPA claims. Id. at 1269. In
accordance with its holdings regarding the ATS claims, the court found the facts to be
insufficient to state a claim under the TVPA:

15

Aponte was the chief of security at the bottling facility at issue. The complaint alleged that Aponte falsely told police
that he found a bomb in the facility and that the plaintiffs had planted the bomb, and that the police subsequently arrested
the plaintiffs, treated them violently, and locked them in a dirty and dangerous prison. Sinaltrainal, 2009 WL 2431463,
at *11.

145

[T]he Gil, Galvis, and Leal plaintiffs fail to sufficiently plead the
paramilitary forces were acting under color of law. Mere toleration
of the paramilitary forces does not transform such forces’ acts into
state acts; moreover there are no allegations the Colombian
government was aware of, much less complicit in, the murder and
torture Plaintiffs allege in their complaints. Additionally, the Garcia
plaintiffs fail to sufficiently allege the Panamco Defendants, or their
agents, conspired with the local police in carrying out the alleged
torture. The Garcia plaintiffs’ vague and conclusory allegations of
a conspiracy do not state a claim for relief that is plausible on its face,
see Iqbal, 129 S. Ct. at 1950, and they fail to detail any factual
allegations “to raise a right to relief above the speculative level,”
Twombly, 550 U.S. at 555, 127 S. Ct. at 1965. We, therefore, vacate
the district court’s dismissal of the TVPA claims for want of
jurisdiction and instruct the court to dismiss the TVPA claims for
failure to state a claim upon which relief can be granted.
Id. at 1270 (additional internal citation omitted).

D.C. Circuit
•
Mitchell v. Fed. Bureau of Prisons, 587 F.3d 415 (D.C. Cir. 2009). The court considered
a motion by the appellant to proceed in forma pauperis (IFP). After determining that IFP
status was barred because the plaintiff’s 65 prior unsuccessful lawsuits made him an abusive
filer, see id. at 419, the court considered whether the plaintiff qualified for an exception
based on imminent danger. In considering the alleged imminent danger, the court “reject[ed]
the government’s argument that [the court] should . . . subject [the plaintiff’s] allegations to
the pleading standard the Supreme Court set forth earlier this year in Ashcroft v. Iqbal . . .
.” Id. at 420. The court explained that the holding in Iqbal that “‘a complaint must contain
sufficient factual matter,’ alleged in non-conclusory terms, ‘to state a claim to relief that is
plausible on its face,’” id. (quoting Iqbal, 129 S. Ct. at 1949), “ha[d] no applicability to IFP
proceedings where [the court] [was] exercising [its] discretion to grant or withhold a
privilege made available by the courts,” id. The court noted that “IFP proceedings are
nonadversarial and implicate none of the discovery concerns lying at the heart of Iqbal.” Id.
(citing Iqbal, 129 S. Ct. at 1950). The court also noted that “if IFP status [wa]s granted,
defendants remain[ed] free to rely on Iqbal in support of a motion to dismiss the underlying
complaint[,] . . . [b]ut when considering IFP eligibility, [the court] shall continue using the
traditional standards applicable to pleadings by pro se prisoners.” Mitchell, 587 F.3d at 420.
The court found that granting IFP status would be inappropriate because the plaintiff had not
adequately alleged imminent danger. Specifically, with respect to the claim that the
defendants had placed the plaintiff in a prison where it was known that snitches would be
attacked, the court emphasized that the plaintiff had waited more than 17 months after the
alleged attack to file for IFP status, and that neither the complaint nor the IFP motion alleged
an ongoing threat. Id. at 420–21 (citation omitted). With respect to the claim that the
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plaintiff’s hepatitis was not being treated, the court found that the allegations were “vague
and unspecific,” noting that the plaintiff never told the court “when he asked for assistance,
what kind of treatment he requested, who he asked, or who denied it,” and “never even
clearly state[d] that medical attention was actually denied.” Id. at 422. The court held that
the allegations were insufficient, explaining that “even viewing [the plaintiff’s] complaint
through the forgiving lens applicable to pro se pleadings, [it] simply [could not] determine
whether [the plaintiff] face[d] an imminent danger.” Id.
•

Tooley v. Napolitano, 586 F.3d 1006 (D.C. Cir. 2009). The plaintiff filed suit against highlevel federal officials, alleging that the officials conducted illegal surveillance of him and
his family. The D.C. Circuit had previously vacated a dismissal of the complaint, finding
that the plaintiff had adequately alleged standing. The government sought rehearing in light
of the subsequent decision in Iqbal. Id. at 1007. “The government argue[d] that Iqbal
extended Twombly, thus invalidating a construction of Twombly previously advanced by [the
D.C. Circuit] in Aktieselskabet AF 21 November 2001 v. Fame Jeans, 525 U.S. 8 (D.C. Cir.
2008).” Id. “While [the D.C. Circuit] d[id] not reject the government’s argument, upon
reflection [it] believe[d] that [it] should affirm the district court . . . for reasons distinct from
but not inconsistent with Iqbal.” Id.
The complaint alleged that the plaintiff called Southwest Airlines to book a flight in 2002,
and upon being asked if he had any comments or suggestions, suggested that the airline
screen 100 percent of everything brought on board, given the events of September 11th and
the potential that someone could put a bomb on the plane. Id. The complaint alleged that
the Southwest agent became alarmed. Thereafter, the plaintiff experienced telephone
troubles, which he stated, on information and belief, were caused by illegal wiretaps. Id. at
1007–08. The plaintiff also alleged that he knew from experience on Capitol Hill that “‘as
long as the phone line is plugged into the wall in one’s home, those listening to wiretaps can
hear anything that goes on in the home.’” Tooley, 586 F.3d at 1008 (quoting an affidavit
submitted by the plaintiff). The complaint also alleged that the government subjected the
plaintiff’s cars to Radio Frequency Identification Tags that monitored their movement. Id.
The complaint further alleged that the plaintiff had been subject to strict searches every time
he traveled. Id. The complaint also asserted that when the president was scheduled visit his
hometown, the plaintiff made unflattering remarks to his family about the Administration
and then noticed that an officer in a Ford Crown Victoria sat outside his home for six hours
per day, “‘as a threat of recrimination or persecution of political speech.’” Id.
After the plaintiff filed requests under the Freedom of Information Act (FOIA), which he
believed were wrongly denied, the plaintiff filed suit alleging violations of the Fourth
Amendment and the constitutional right to privacy, as well as deprivation of First
Amendment rights and retaliation for his comments to the Southwest representative, and
declaratory relief under FOIA. Id. After the plaintiff dismissed some of the defendants, the
remaining defendants included the U.S. Attorney General, the Secretary of the Department
of Homeland Security, and the Administrator of the Transportation Security Administration,
each sued in their official capacities. Id. at 1007. The district court granted summary
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judgment to the defendants on the FOIA claims, and that ruling was not challenged on
appeal. Tooley, 586 F.3d at 1008. The government sought dismissal of the remaining claims
based on lack of standing, and the district court granted dismissal, finding, with respect to
the claims based on wiretapping and physical surveillance, that “‘it [wa]s altogether
possible’ that Tooley was the subject of ‘entirely lawful wiretaps placed by state or local law
enforcement agencies’ and that Tooley could not show that it was a federal agent responsible
for any of his alleged physical surveillance.” Id. at 1008–09. The district court
characterized the plaintiffs other claims as being based on his placement on a terrorist watch
list, and found standing but dismissed based on lack of subject matter jurisdiction because
the Court of Appeals had exclusive jurisdiction over directives issued by the Transportation
Security Administration. Id. at 1009.
On rehearing, the D.C. Circuit noted that “[a] complaint may be dismissed on jurisdictional
grounds when it ‘is ‘patently insubstantial,’ presenting no federal question suitable for
decision.’” Id. (quoting Best v. Kelly, 39 F.3d 328, 330 (D.C. Cir. 1994), and citing Iqbal,
129 S. Ct. at 1959 (Souter, J., dissenting), for the proposition that “‘[t]he sole exception to
th[e] rule [that allegations must be credited at the pleading stage applies to] allegations that
are sufficiently fantastic to defy reality as we know it: claims about little green men, or the
plaintiff’s recent trip to Pluto, or experience in time travel.’”) (second and third alterations
in original) (additional citation omitted). The court found that the claims against the federal
officials were insufficient. The court stated that “[t]he alleged motivation . . . was nothing
if not bizarre: the defendants, people charged with protecting the country’s security,
allegedly acted out of a desire to ‘retaliate’ against Tooley for his having offered a
suggestion of additional measures that he claimed would enhance airline security.” Id. The
court noted that the plaintiff alleged that “[a]lternatively, some of the surveillance was
evidently to persecute him for remarks critical of the Bush Administration, remarks likely
indistinguishable from those of millions of Americans.” Id. The court found that “the
particular combination of sloth, fanaticism, inanity and technical genius alleged . . . seem[ed]
. . . to move the[ ] allegations into the realm of claims ‘flimsier than ‘doubtful or
questionable’— . . . ‘essentially fictitious.’’” Tooley, 586 F.3d at 1009 (quoting Best, 39
F.3d at 330) (third omission in original). The court concluded that the allegations were “not
realistically distinguishable from allegations of ‘little green men’ of the sort that Justice
Souter recognized in Iqbal as properly dismissed on the pleadings.” Id. at 1009–10 (citing
Iqbal, 129 S. Ct. at 1959 (Souter, J., dissenting)). The court also explained that the claims
were similar to those in other cases where the courts had “dismissed for patent
insubstantiality,” and cited cases both before and after Twombly. The court held: “Because
the allegations of Tooley’s complaint constitute the sort of patently insubstantial claims
dismissed in these and other cases, we conclude that the district court was correct in its
judgment of dismissal.” Id. at 1010.
•

Atherton v. District of Columbia Office of Mayor, 567 F.3d 672 (D.C. Cir. 2009). Two
days after the plaintiff was sworn in as a D.C. Superior Court grand juror, he was
permanently removed from grand jury service when an Assistant U.S. Attorney (“AUSA”)
who was presenting evidence to the grand jurors reported to a supervising AUSA (Daniel
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Zachem) that the jurors were complaining about the plaintiff. Id. at 676. Zachem discussed
the issue with the juror officer (Suzanne Bailey-Jones), and Bailey-Jones “summarily and
permanently removed Atherton from the grand jury for being ‘disruptive.’” Id. The
plaintiff’s pro se complaint alleged that he was unlawfully removed from grand jury service
because of his deliberative judgments and his Hispanic ethnicity, and asserted claims against
Bailey-Jones, Zachem, the Director of Special Operations at the Superior Court (Roy Wynn),
several other city and federal officials, the District of Columbia, and the Department of
Justice Office of the Attorney General. Id. at 677. The complaint alleged constitutional
violations of due process and equal protection against the District of Columbia defendants
and the federal defendants under §§ 1983, 1985(3), and 1986, and Bivens, as well as a
common law fraud claim. Id. The district court dismissed the complaint for failure to state
a claim, finding that it failed to allege that any defendants other than Bailey-Jones and
Zachem were directly involved in his dismissal, and that the plaintiff had failed to state a
claim for municipal liability against the District of Columbia. Id. The district court also
dismissed the § 1985(3) claim without explanation; dismissed the § 1986 claim as timebarred; dismissed the official capacity claims under § 1983 against the municipality because
Bailey-Jones was acting outside the scope of her authority in removing the juror; dismissed
the individual capacity claims against the superior court clerk and Wynn because the
allegations did not support any personal involvement by these defendants in the decision to
remove Atherton from the jury; declined to exercise supplemental jurisdiction over the fraud
claim alleged against the superior court clerk and Wynn; and found that the fraud claim
against Zachem was barred by sovereign immunity because the Federal Tort Claims Act
required substituting the United States for Zachem. Atherton, 567 F.3d at 680. Although
the district court found that the complaint adequately stated due process and equal protection
claims against Zachem and Bailey-Jones, it dismissed the claims against them under § 1983
and Bivens because they were entitled to absolute immunity. Id. The Eleventh Circuit
reversed the dismissal of the due process claims against Bailey-Jones and Zachem because
absolute immunity did not apply; affirmed the dismissal of the equal protection and §
1985(3) claims, and the due process claim against Wynn, for failure to state a claim; and
affirmed the dismissal of the remaining claims. Id. at 677.
The D.C. Circuit discussed the pleading standards and affirmed that notice pleading is still
effective, first noting that Rule 8 requires only “‘a short and plain statement of the claim
showing that the pleader is entitled to relief’ in order to survive a motion to dismiss,’” id. at
681 (quoting FED. R. CIV. P. 8(a)(2)), and then that “[a] complaint must give the defendants
notice of the claims and the grounds upon which they rest, but ‘[s]pecific facts are not
necessary,’” id. (quoting Erickson v. Pardus, 551 U.S. 89, 93 (2007)). With respect to a
claim of invidious discrimination, the court pointed out that in Iqbal, the Supreme Court had
required pleading that the defendant acted with discriminatory purpose, and that purposeful
discrimination “‘involves a decisionmaker’s undertaking a course of action ‘because of,’ not
merely ‘in spite of,’ [the action’s] adverse effects upon an identifiable group.’” Id. (quoting
Iqbal, 129 S. Ct. at 1948) (alteration in original). The court emphasized that “[a] pro se
complaint . . . ‘must be held to less stringent standards than formal pleadings drafted by
lawyers,’” id. (quoting Erickson, 551 U.S. at 94), but that “even a pro se complaint must
149

plead ‘factual matter’ that permits the court to infer ‘more than the mere possibility of
misconduct,’” Atherton, 567 F.3d at 681 (quoting Iqbal, 129 S. Ct. at 1950).
The court concluded that the equal protection claim under § 1983 was not supported by
sufficient facts:
The only factual allegations in Atherton’s complaint on his
equal protection claim are that: (1) after a witness who could not
speak English testified before the grand jury, Atherton openly
thanked the witness in Spanish, Compl. ¶¶ 64–65; (2) “based on
information, Atherton was the only semi-fluent Spanish speaking
grand juror,” id. at ¶ 67; and (3) Atherton is “half Mexican,” id.
From these facts, Atherton alleges that, “based upon information,” his
removal without cause from the grand jury was an act of
discrimination against him “and Hispanics in particular because there
were no other Hispanics on the jury.” Id. at ¶ 73. He also alleges
that the defendants conspired to illegally remove him from the grand
jury “for ethnic purposes.” Id. at ¶ 68. These spare facts and
allegations are not enough to survive a motion to dismiss under Iqbal
and Twombly. The complaint and supporting materials simply do
“not permit the court to infer more than the mere possibility of
misconduct,” Iqbal, 129 S. Ct. at 1950, and this is insufficient to
show that Atherton is entitled to relief. See FED. R. CIV. P. 8(a)(2).
As the Court noted in Iqbal, “[w]here a complaint pleads facts that
are merely consistent with a defendant’s liability, it stops short of the
line between possibility and plausibility of entitlement to relief.”
Iqbal, 129 S. Ct. at 1949 (internal quotation marks and citation
omitted). We therefore reverse the District Court’s finding that
Atherton stated claims of equal protection violations by Bailey-Jones
and Zachem.
Id. at 688 (alteration in original).
With respect to the 1985(3) claims, the court noted that Atherton was required to allege “‘(1)
a conspiracy; (2) for the purpose of depriving, either directly or indirectly, any person or
class of persons of the equal protection of the laws, . . . and (3) an act in furtherance of the
conspiracy; (4) whereby a person is either injured in her person or property or deprived of
any right or privilege of a citizen of the United States,’” id. (quoting Martin v. Malhoyt, 830
F.2d 237, 258 (D.C. Cir. 1987)) (alteration in original), but that “Atherton’s complaint and
supporting materials merely allege[d] that Zachem, Bailey-Jones, and Wynn communicated
about his removal before he was dismissed from the grand jury,” id. The court concluded
that “[t]hese bare facts clearly d[id] not raise an inference that Zachem, Bailey-Jones, and
Wynn were conspiratorially motivated by some class-based, invidiously discriminatory
animus.” Id. The court noted that “[t]he complaint also assert[ed] that the defendants
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‘conspired under color of law to illegally remove Atherton . . . for ethnic purposes,’ and that
Atherton was illegally removed from the grand jury in violation of the Constitution and D.C.
law,” id. (omission in original) (internal record citation omitted), but concluded that “these
‘[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory
statements do not suffice’ to state a cause of action under § 1985(3),” Atherton, 567 F.3d at
688 (quoting Iqbal, 129 S. Ct. at 1949) (alteration in original).

DISTRICT COURT CASE LAW INTERPRETING IQBAL
District Court Case Law in the First Circuit
•
Soto-Martinez v. Colegio San Jose, Inc., No. 08-2374 (JAG), 2009 WL 2957801 (D.P.R.
Sept. 9, 2009). The plaintiff alleged that he was subject to a hostile work environment,
retaliation, and termination as a result of his gender. Id. at *1. The court found that the
hostile work environment claim failed because the conclusory assertion that the plaintiff was
discriminated against because of his gender was not entitled to a presumption of truth, and
“[t]he only factual allegations proffered by Plaintiffs [we]re that Soto-Martinez suffered
from verbal harassment that insinuated that he was a homosexual.” Id. at *3. The court
relied on pre-Twombly cases to conclude that “[t]hese allegations [we]re certainly not
enough to sustain a Title VII hostile work environment claim.” Id. (citing Bibby v.
Philadelphia Coca-Cola Bottling Co., 260 F.3d 257, 264 (3d Cir. 2001); Spearman v. Ford
Motor Co., 231 F.3d 1080, 1085 (7th Cir. 2000); Higgins v. New Balance Athletic Shoe, Inc.,
194 F.3d 252, 258 (1st Cir. 1999)). The allegation that one of the defendants corrected the
plaintiff’s work in front of others was not sufficient to sustain a Title VII claim because the
complaint did not allege that this act occurred because the plaintiff was a man. Id. at *4.
In evaluating the claim that the plaintiff was terminated because of his gender, the court
noted that “although heightened fact pleading of specifics is not required to properly allege
a prima facie case of discrimination, there must be enough facts to state a claim to relief that
is plausible on its face.” Id. (citing Twombly, 550 U.S. at 569–70). The court dismissed this
claim because in addition to failing to allege one of the elements of a prima facie case, the
complaint failed to allege any facts to support the conclusion that the plaintiff was
terminated based on his gender. Soto-Martinez, 2009 WL 2957801, at *5.
The court also dismissed the retaliation claim because the allegations that the plaintiff
engaged in protected conduct under Title VII were not sufficient. Id. at *6. The court
explained that “Title VII does not protect against verbal harassment from fellow employees
that insinuate that the person is a homosexual” and that “Title VII does not proscribe
harassment simply because of sexual orientation.” Id. The court concluded that the
“complaint was not directed at an unlawful practice as it did not point out ‘discrimination
against particular individuals nor discriminatory practices by Defendants.’” Id. (citing
Higgins, 194 F.3d at 259).
•

Soukup v. Garvin, No. 09-cv-146-JL, 2009 WL 2461687 (D.N.H. Aug. 11, 2009)
151

(unpublished). The plaintiff sued an arresting officer and the officer’s employer under §
1983, alleging violations of his civil rights under the Fourth and Fourteenth Amendments.
Id. at *1. The plaintiff also asserted a common law claim for false imprisonment. Id. In
considering a motion for judgment on the pleadings, the court concluded that allegations that
the town’s police department “‘developed and maintained policies or customs exhibiting
deliberate indifference to the constitutional rights of persons in the Town of Lisbon’ and that
it was the department’s ‘policy and/or custom . . . to fail to exercise reasonable care in
supervising and training its police officers’” did not adequately plead the claim against the
town because there were no supporting factual allegations. Id. at *2 (omission in original).
The court concluded that the allegations would be insufficient both before and after
Twombly/Iqbal:
The debate over the extent to which Twombly and Iqbal have
heightened the pleading standard under Rule 8 continues, and will
undoubtedly fill law review articles, but is ultimately irrelevant to the
disposition of this motion. Soukup cites Conley’s maxim that a
complaint requires notice only of “what the plaintiff’s claim is and
the grounds upon which it rests,” 355 U.S. at 47, but elides the
second requirement, arguing that “pleadings are intended to give
notice to the defendant of the claims—not of the facts supporting
them.”
This is incorrect. In fact, even before Twombly and Iqbal, the
court of appeals had repeatedly held that a complaint needs more
than “bald assertions . . . [or] unsubstantiated conclusions,”
Correa-Martinez v. Arrillaga-Belendez, 903 F.2d 49, 52 (1st Cir.
1990), overruled on other grounds by Educadores Puertorriguenos
en Accion v. Hernandez, 367 F.3d 61 (1st Cir. 2004); nor may a
plaintiff “rest on subjective characterizations or conclusory
descriptions of a general scenario.” Murphy v. United States, 45
F.3d 520, 522 (1st Cir. 1995); see also Redondo-Borges v. U.S. Dept.
of Hous. and Urban Dev., 421 F.3d 1, 9 (1st Cir. 2005) (“The fact
that notice pleading governs . . . does not save the plaintiffs’
conclusory allegation.”); Centro Medico del Turabo, Inc. v. Feliciano
de Melecio, 406 F.3d 1, 6 (1st Cir. 2005) (requiring pleadings to “set
forth factual allegations, either direct or inferential, respecting each
material element necessary to sustain recovery under some actionable
legal theory”) (emphasis added) (internal quotation marks omitted).
Soukup’s complaint offers nothing more than these.
While Soukup attempts to argue otherwise, he is belled by his
complaint which, as to the constitutional claims against the Town of
Lisbon, contains not a single assertion of fact. Rather, Soukup’s
accusations are couched completely as legal conclusions, with the
152

defendant’s name merely plugged into the elements of a municipal
liability claim. Even if Twombly or Iqbal had never been decided,
Soukup’s complaint would fall short of the pleading requirements
under prior First Circuit authority; as it is, it certainly fails to avoid
Twombly’s warning that “formulaic recitation of a cause of action’s
elements will not do.” 550 U.S. at 555. His complaint therefore fails
to state a claim that the Town of Lisbon violated his federal
constitutional rights.
Id. at *3 (emphasis added) (omission and alteration in original).
•

Ocasio-Hernandez v. Fortuno-Burset, 639 F. Supp. 2d 217 (D.P.R. Aug. 4, 2009). Former
employees of the governor’s mansion sued the governor, his wife, and other staff members
under § 1983, alleging that their employment was terminated based on their political views.
The claims against several of the defendants failed because there were no factual allegations
tying the defendants to the deprivation of the plaintiffs’ constitutional rights. Id. at 222. The
court concluded that “[t]he allegation that all of the defendants asked all of the plaintiffs
about how and when they began working at [the governor’s mansion] is a generic allegation,
made without reference to specific facts that might make it ‘plausible on its face.’” Id.
(quoting Iqbal, 129 S. Ct. at 1949). The claims against the governor’s wife were supported
only by citation to a law and an organization chart that gave her the power to oversee
maintenance work at the mansion, and the court concluded that there were no facts alleged
to suggest that she participated in the decision to terminate the plaintiffs. Id. The political
discrimination claim was dismissed because the “plaintiffs . . . failed to make a fact-specific
showing that a causal connection exists between their termination from employment and
their political affiliation . . . .” Id. at 224. The due process claim was dismissed because the
plaintiffs had no “property right to continued employment.” Id. The equal protection claim
was dismissed because there was no distinct basis for it beyond the allegations under the
First Amendment claim; because the plaintiffs failed to “allege a minimally sufficient claim
in even conclusory terms, let alone support the claim with facts raising a plausible claim to
relief”; and because the plaintiffs failed to explain why the “class-of-one” equal protection
doctrine should be applied to a claim for employment discrimination. Ocasio-Hernandez,
639 F. Supp. 2d at 225. The state law claims were dismissed because the alleged facts were
insufficient to plead discriminatory animus and there was no other factual basis to find a
violation of state law. Id. at 225–26. In dismissing the complaint, the court explained:
The court notes that its present ruling, although draconianly
harsh to say the least, is mandated by the recent Iqbal decision
construing Rules 8(a)(2) and 12(b)(6). The original complaint, filed
before Iqbal was decided by the Supreme Court, as well as the
Amended Complaint, clearly met the pre-Iqbal pleading standard
under Rule 8. As a matter of fact, counsel for defendants,
experienced beyond cavil in political discrimination litigation, did not
file a 12(b)(6) motion to dismiss the original complaint because the
153

same was properly pleaded under the then existing, pre-Iqbal
standard. . . .
As evidenced by this opinion, even highly experienced
counsel will henceforth find it extremely difficult, if not impossible,
to plead a section 1983 political discrimination suit without “smoking
gun” evidence. In the past, a plaintiff could file a complaint such as
that in this case, and through discovery obtain the direct and/or
circumstan[t]ial evidence needed to sustain the First Amendment
allegations. If the evidence was lacking, a case would then be
summarily disposed of. This no longer being the case, counsel in
political discrimination cases will now be forced to file suit in
Commonwealth court, where Iqbal does not apply and post-complaint
discovery is, thus, available. Counsel will also likely only raise local
law claims to avoid removal to federal court where Iqbal will sound
the death knell. Certainly, such a chilling effect was not intended by
Congress when it enacted Section 1983.
Id. at 226 n.4 (emphasis added) (internal record citations omitted).
•

Chao v. Ballista, 630 F. Supp. 2d 170 (D. Mass. 2009). The plaintiff alleged that prison
officials failed to protect her from sexual abuse, and sought to recover under § 1983 for the
officials’ failure to investigate and prevent the abuse. Id. at 173. The court rejected the
defendants’ argument that the plaintiff alleged only conclusory allegations regarding the
alleged failure to train, supervise, and investigate. Id. at 177. The court explained:
Notice pleading, however, remains the rule in federal courts,
requiring only “a short and plain statement of the claim.” See FED.
R. CIV. P. 8(a). While a plaintiff’s claim to relief must be supported
by sufficient factual allegations to be “plausible” under Twombly,
nothing requires a plaintiff to prove her case in the pleadings. Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167
L. Ed. 2d 929 (2007). Plausibility, as the Supreme Court’s recent
elaboration in Ashcroft v. Iqbal makes clear, is a highly contextual
enterprise—dependent on the particular claims asserted, their
elements, and the overall factual picture alleged in the complaint. --U.S. ----, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009); Maldonado v.
Fontanes, 568 F.3d 263, 268 (1st Cir. 2009) (“[T]he court’s
assessment of the pleadings is context-specific, requiring the
reviewing court to draw on its judicial experience and common
sense.”) (internal quotation marks omitted).
Id. (emphasis added) (alteration in original). The court elaborated:

154

Plausibility, in this view, is a relative measure. Allegations
become “conclusory” where they recite only the elements of the
claim and, at the same time, the court’s commonsense credits a far
more likely inference from the available facts. This analysis depends
on the full factual picture, the particular cause of action, and the
available alternative explanations. Yet in keeping with Rule 8(a), a
complaint should only be dismissed at the pleading stage where the
allegations are so broad, and the alternative explanations so
overwhelming, that the claims no longer appear plausible. See
Thomas v. Rhode Island, 542 F. 3d 944, 948 (1st Cir. 2008)
(juxtaposing Rule 8(a)’s fair notice and plausibility requirements, as
interpreted in Twombly).
Id. (emphasis added) (additional internal citations omitted). The court concluded that the
factual allegations were more than sufficient to state a plausible claim to relief. Id. at
177–79. The court stated: “To be sure, discovery may ultimately reveal an alternative
picture, showing that the Defendants made every reasonable effort to prevent the alleged
abuse. But Chao has presented sufficient facts, at a stage where her factual allegations must
be taken as true, to overcome that alternative for the time being.” Chao, 630 F. Supp. 2d at
178.

District Court Case Law in the Second Circuit
•
Gillman v. Inner City Broadcasting Corp., No. 08 Civ. 8909(LAP), 2009 WL 3003244
(S.D.N.Y. Sept. 18, 2009). The plaintiff asserted age discrimination and retaliation claims,
alleging that he was fired as a result of his age and in retaliation for his reporting sexual
harassment, and also asserted a claim for sexual harassment. The court confirmed that the
Iqbal standard applies in employment discrimination cases:
The Iqbal plausibility standard applies in conjunction with
employment discrimination pleading standards. According to
Swierkiewicz v. Sorema N.A., 534 U.S. 506, 514 (2002), employment
discrimination claims need not contain specific facts establishing a
prima facie case of discrimination. Rather, “a complaint must
include . . . a plain statement of the claim . . . [that] give[s] the
defendant fair notice of what the plaintiff’s claim is and the grounds
upon which it rests.” Id. at 512 (internal quotation marks and
citations omitted); see also Patane v. Clark, 508 F.3d 106, 113 (2d
Cir. 2007). Iqbal was not meant to displace Swierkiewicz’s
teachings about pleading standards for employment discrimination
claims because in Twombly, which heavily informed Iqbal, the
Supreme Court explicitly affirmed the vitality of Swierkiewicz. See
Twombly, 550 U.S. at 547 (“This analysis does not run counter to
Swierkiewicz . . . . Here, the Court is not requiring heightened fact
155

pleading of specifics, but only enough facts to state a claim to relief
that is plausible on its face.”); see also Iqbal, --- U.S. ----, 129 S. Ct.
at 1953 (“Our decision in Twombly expounded the pleading standard
for all civil actions, and it applies to antitrust and discrimination suits
alike.” (internal quotation marks and citations omitted)).
Accordingly, while a complaint need not contain specific facts
establishing a prima facie case of employment discrimination to
overcome a Rule 12(b)(6) motion to dismiss, it must nevertheless
give fair notice of the basis of Plaintiff’s claims, and the claims must
be facially plausible.
Id. at *3 (emphasis added) (alterations and omissions in original) (footnote omitted) . The
court also noted:
[A]lthough decided before the Supreme Court’s Iqbal decision,
Boykin v. KeyCorp, 521 F.3d 202 (2d Cir. 2008), describes the
interrelation of Swierkiewicz and Twombly and concludes that “the
Supreme Court is not requiring a universal standard of heightened
fact pleading, but is instead requiring a flexible plausibility standard,
which obliges a pleader to amplify a claim with some factual
allegations in those contexts where such amplification is needed to
render the claim plausible.”
Id. at *3 n.9 (quoting Boykin, 521 F.3d at 213 (internal quotation marks omitted)).16
The court concluded that the plaintiff had adequately pleaded a claim for hostile work
environment:

16

See also Peterec-Tolino v. Commercial Elec. Contractors, Inc., No. 08 Civ. 0891(RMB)(KNF), 2009 WL 2591527,
at *2 (S.D.N.Y. Aug. 19, 2009) (noting in the “legal standard” portion of the opinion that “‘[a]n employment
discrimination plaintiff . . . must simply ‘give the defendant fair notice of what the plaintiff’s claim is and the grounds
upon which it rests,’’” and that “‘[t]he pleading requirements in discrimination cases are very lenient, even de minimis”)
(quoting Kassner v. 2d Ave. Delicatessen Inc., 496 F.3d 229, 237 (2d Cir. 2007); Deravin v. Kerik, 335 F.3d 195, 200
(2d Cir. 2003); and citing Boykin, 521 F.3d at 212–16) (omission in original). The Peterec-Tolino court concluded that
the plaintiff had adequately stated a claim of disability discrimination under the ADA by alleging that the defendant was
his employer; that the plaintiff had physical impairments, including scoliosis and asthma, that substantially limited one
or more major life activities; that the plaintiff had notified his employer of his medical conditions and requested a
reasonable accommodation; that he was able to do his job and his performance had always been excellent; that the
defendants failed to accommodate his disability; and that he was harassed, threatened, and terminated. Id. at *5. The
court also concluded that the plaintiff had adequately alleged a claim of age discrimination under the Age Discrimination
in Employment Act by alleging that he was 46 years old; that he was able to do his job; that the plaintiffs harassed,
threatened, and terminated him; and that another employee warned the plaintiff that “he should ‘not . . . be in this
industry.’” Id. at *6 (omission in original). The court concluded that “‘[s]uch allegations by a pro se plaintiff are
sufficient to withstand a motion to dismiss.’” Id. (quoting Legeno v. Corcoran Group, 308 F. App’x 495, 497 (2d Cir.
2009)).

156

The facts alleged in the Complaint Letter are sufficient to
make out a plausible claim that Plaintiff was forced to work in an
environment where he felt sexually threatened. Plaintiff alleges that
at least since 1993, Cheryl Sutton, a member of the Defendant’s
Board of Directors and sister of the Chairman, made unwanted
advances toward Plaintiff in the form of invitations to travel with her,
requests to work late when no employees would be in the workplace,
and unsolicited gifts. Whether or not those acts actually qualify as
discriminatory conduct severe or pervasive enough to create an
objectively hostile or abusive work environment is a question to be
determined at a later stage of this action. The record reflects that
they were sufficiently troubling to Plaintiff to warrant a complaint to
the Chairman of the Company in 1993 and in late 2007. And the fact
that Plaintiff was terminated relatively soon after complaining to the
offending Board Member seems not to be in dispute. Taking
Plaintiff’s factual allegations as true, Plaintiff suffered an alteration
to the conditions of his work environment. Accordingly, Plaintiff's
allegations present at least a minimally plausible and articulate
discrimination claim.
Id. at *4 (emphasis added) (footnote omitted).
But the court concluded that the allegations regarding the age discrimination claim were
insufficient, noting that most of the facts alleged were irrelevant to whether the plaintiff was
fired based on his age. Id. at *5. The one allegation that might support the age
discrimination claim—that 13 other individuals were fired after reaching age 40—was not
sufficient “without more information about the reasons for their termination or specific
employment practices by the Defendant . . . ” because “merely alleging that a disparate
impact occurred or pointing to a generalized discriminatory policy is insufficient to make
out a plausible age discrimination claim.” Id. at *6.
With respect to the retaliation claim, the court concluded that it was sufficiently pleaded
because the plaintiff alleged that he complained about unwanted advances in late 2007 and
was terminated in February 2008. Gillman, 2009 WL 3003244, at *6. The court held that
“[c]onsidering that Plaintiff has made out a plausible hostile work environment claim, . . .
these additional factual allegations, minimal as they might be, are sufficient to show (1)
Plaintiff’s opposition to the allegedly discriminatory treatment, (2) that Defendant was aware
of Plaintiff’s opposition—assuming Cheryl Sutton’s knowledge may be imputed to the
Company, (3) that Defendant took adverse action against Plaintiff by terminating him, and
(4) that a retaliatory motive allegedly played a part in the adverse employment action.” Id.
•

Kregler v. City of N.Y., 646 F. Supp. 2d 570 (S.D.N.Y. 2009). The plaintiff brought suit
under § 1983, alleging that the defendants violated his rights under the First and Fourteenth
Amendments when he allegedly was not hired for a job in retaliation for his public
157

endorsement of a candidate for district attorney. Id. at 571. After working as Fire Marshal
for the fire department for 20 years, the plaintiff retired and submitted an application to be
a City Marshal. Id. In his lawsuit, the plaintiff alleged that the Chief Fire Marshal (Garcia)
and the Department of Investigation Commissioner (Hearn) agreed to cause the plaintiff’s
application for City Marshal to be rejected because of the plaintiff’s support of a candidate
for district attorney; that Garcia, the Supervising Fire Marshal (Grogan), and other fire
department employees requested that Department of Investigation employees misuse their
authority to cause the plaintiff’s application to be rejected; and that the stated reason for the
rejection of plaintiff’s application—that the plaintiff failed to disclose details of discipline
he received at the fire department—was merely a pretext for the retaliation. Id. The court
found the conclusory pleadings insufficient, noting that “[a]bsent sufficient factual
allegations that Gill Hearn, who is the only decision-maker named in the Amended
Complaint, had knowledge of Kregler’s support of Morgenthau and agreed to cause his
application to be denied for that reason, Kregler has not pled facts ‘enough to raise the right
to relief above the speculative level.’” Id. at 574 (quoting Twombly, 550 U.S. at 555). The
court concluded that even if it credited some of the conclusory allegations in the complaint,
the allegations were merely consistent with unlawful behavior, not plausible. Id. at 574–75.
The facts alleged were more consistent with lawful conduct because even though the
plaintiff had already endorsed the candidate, his application for City Marshal went through
significant administrative steps, and the court concluded that “[i]t would not comport with
experience and common sense for Defendants to expend so much public time, energy and
resources fully processing the papers of an applicant whose appointment they allegedly had
already agreed to reject for unlawful reasons.” Id. at 575.
The court employed a Rule 12(i) hearing17 as a means of evaluating whether dismissal was

17

Rule 12(i)—formerly Rule 12(d) before the 2007 restyling—provides: “If a party so moves, any defense listed in Rule
12(b)(1)–(7)—whether made in a pleading or by motion—and a motion under Rule 12(c) must be heard and decided
before trial unless the court orders a deferral until trial.” FED. R. CIV. P. 12(i). According to one treatise, “Rule 12(i)
allows a party to assert Rule 12(b) defenses and a Rule 12(c) motion for judgment on the pleadings before trial on the
merits, contemplating the possible hearing and determination of jurisdictional or other issues in advance of trial. The
district court is free to decide the best way to deal with the question, because neither the federal rules nor the statutes
provide a prescribed course. The court’s decision whether to hold a preliminary hearing or to defer the matter to trial
on the merits may be set aside on appeal only for abuse of discretion.” 2 JAMES WM. MOORE ET AL., MOORE’S FEDERAL
PRACTICE § 12.50 at 12-142 (3d ed. 2009) (footnotes omitted). The treatise explains: “Because most of the defenses in
Rule 12(b) that can be addressed by a preliminary hearing affect the court’s jurisdiction, it is advisable to dispose of them
before trial if at all possible, regardless of the court’s power to defer them. On the other hand, if ruling on the defense
entails substantial consideration of the merits, as is often the case, the question can most effectively be addressed during
trial. Deferring matters until trial also allows a court to give consideration to matters with such grave consequences as
motions for dismissal under Rule 12(b)(1)–(7) or a judgment on the pleadings under Rule 12(c).” Id. at 12-143. The
treatise also notes that “[b]oth Rule 12’s preliminary hearing and its discretionary deferral to trial are valuable but often
overlooked tools in the court’s arsenal.” Id. at 12-143–44.
Another treatise has explained that in determining whether to exercise discretion to grant a preliminary hearing,
as opposed to deferring the issues to trial, “the district court must balance the need to test the sufficiency of the defense
or objection and the right of a party to have his defense or objection decided promptly and thereby possibly avoid costly
and protracted litigation against such factors as the expense and delay the hearing may cause, the difficulty or likelihood

158

appropriate, and in discussing the use of that mechanism, opined on the competing values
at stake in evaluating complaints:
Fundamentally, the “plausibility” standard that the Supreme
Court articulated in Twombly and Iqbal reflect[s] one judicial means
to part the wheat from the chaff in assessing the sufficiency of
pleadings. Yet, as the case at hand illustrates and the law reports
amply record, the problem persists, a sign of an intrinsic tension built
into the federal rules. Whether in their factual allegations as
originally crafted, or upon being granted leave to replead deficient
claims, seasoned plaintiffs’ counsel know to charge the pleadings
with enough adjectives that reverberate of extreme malice, improper
motives, and bad faith to raise factual issues sufficient to survive a
dispositive motion, thus securing a hold on the defendant strong
enough for the duration, however long and costly the ultimate
resolution of the claim may be.
In practical terms, the philosophy of pleading that these rules
embody, a one-rule-fits-all principle, defines the scope of the problem
engendered by its unintended outcomes. For instance, in theory the
same generalized minimal Rule 8(a) standards that govern the
plaintiff’s drafting, as well as the court’s review, of a complaint
alleging common law negligence stemming from a slip and fall, or a
breach of a simple contract for failure to pay a debt, apply to writing
and evaluating a complaint charging civil violations of intricate
federal antitrust, intellectual property, or racketeering statutes.
Similarly, the bare bones essence of a claim that is necessary to
survive a motion to dismiss is the same whether the complaint is
authored by John Dioguardi or by Wall Street lawyers. See
Dioguardi v. Durning, 139 F.2d 774 (2d Cir.1944).
In consequence, the Court’s Rule 12(i) hearing represented an
effort to employ an infrequently used procedure to bring about
speedier and better-informed resolution of a motion to dismiss

of arriving at a meaningful result of the question presented by the motion at the hearing, and the possibility that the issue
to be decided on the hearing is so interwoven with the merits of the case, which . . . can occur in various contexts, that
a postponement until trial is desirable.” 5C CHARLES A. WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND
PROCEDURE § 1373 (3d ed. 2004) (footnotes omitted). This treatise also notes: “A district court cannot dismiss a
complaint on the basis of a Rule 12(b) defense or objections without giving the plaintiff an opportunity to be heard; a
dismissal without that opportunity has been properly characterized as a denial of due process. At a preliminary hearing,
the court may consider affidavits and other documentary matter and if the decision turns on issues of credibility or
disputed questions of fact, the district judge may hear oral testimony.” Id. (footnotes omitted). The treatise further notes
that “[i]f the issue is of so complex or uncertain a nature that witnesses are necessary, it would be wise for the court to
defer the determination of the matter until trial.” Id. (footnote omitted).

159

involving serious accusations of violations of constitutional rights
leveled against high-ranking government officials.
Id. at 577.
•

Air Atlanta Aero Eng’g Ltd. v. SP Aircraft Owner I, LLC, 637 F. Supp. 2d 185 (S.D.N.Y.
2009). The plaintiff brought suit alleging breach of contract, account stated, unjust
enrichment, quantum meruit, and promissory estoppel in connection with services that the
plaintiff provided to a non-party. The plaintiff alleged that it was a third-party beneficiary
of the contracts at issue. The court granted the defendants’ motion to dismiss all of the
claims, but also granted leave to file an amended complaint. The court found that the breach
of contract claim failed because the plaintiff was not a third party beneficiary, and the unjust
enrichment, quantum meruit, and promissory estoppel claims failed because there were
express contracts preventing quasi-contractual remedies. Id. at 195–96.
With respect to the account stated claim, the court concluded that the plaintiff had not
alleged enough facts to state a plausible claim under Iqbal, particularly with respect to
alleging the required state of mind. See id. at 198. Regarding the first element of the
account stated claim—that an account was presented—the court noted that the complaint
alleged an agency theory but the plaintiff “did not direct the Court to any language in the
Leases granting . . . representatives with the authority to accept and review statements or
otherwise supervise billing and payments.” Id. The court found that “the Complaint d[id]
not sufficiently allege facts supporting the legal conclusion that ACG functioned as Ambac’s
approved agent for the purpose of receiving presented statements such that presentation of
a statement to ACG was the equivalent of its presentation to Ambac.” Id. at 198–99. With
respect to the second element of the account stated claim—that the account was accepted as
correct—the court found that this element was sufficiently pleaded because the plaintiff
alleged that the debtor never objected to the account stated, which could amount to an
implied acceptance. See id. at 199. But the third element of the account stated claim—that
the debtor promised to pay the amount stated—was deemed insufficiently pleaded. Air
Atlanta, 637 F. Supp. 2d at 199. The court found that even if there was indebtedness, the
plaintiff’s “cryptic statement that ‘Ambac confirmed its intention to pay AAAE’ [wa]s not
a sufficient pleading under Iqbal.” Id. at 200. The court explained: “AAAE essentially
makes a conclusory allegation as to Ambac’s state of mind and its intentions. However,
AAAE fails to specify the form of the alleged confirmation; who made the confirmation;
how, where, or when the confirmation took place; or any other details about this
confirmation.” Id. (citing Iqbal, 129 S. Ct. at 1952). The court continued: “[I]n the context
of this case, a blanket statement that a defendant ‘confirmed an intention to pay’ without any
factual details supporting that allegation does not state a plausible claim for relief. While
such allegations may have provided sufficient notice pleading in the past, Twombly and
Iqbal provide clear instructions that conclusory statements about a party’s alleged intentions
should be accompanied with supporting factual allegations where circumstances so demand.”

160

Id. (emphasis added).18
•

Argeropoulos v. Exide Techs., No. 08-CV-3760 (JS), 2009 WL 2132443 (E.D.N.Y. Jul. 8,
2009). The plaintiff sued his employer and another employee, alleging discrimination under
Title VII and state law claims for violations of the New York Human Rights Law. Id. at *1.
The plaintiff alleged that he was subject to discrimination and harassment because of his
national origin and perceived sexual orientation. Id. The Title VII claims against the
employee were dismissed as frivolous because individuals are not subject to liability under
Title VII. Id. at *3. With respect to the plaintiff’s discrimination claims based on perceived
sexual orientation and sexual harassment, those claims were dismissed because Title VII
does not prohibit harassment or discrimination based on sexual orientation. Id. Although
Title VII protects against sexual harassment, the plaintiff failed to adequately plead facts
supporting a claim for same-sex harassment. Id. at *4. The court emphasized that
“[b]ecause he [wa]s at the motion to dismiss stage, Plaintiff obviously ha[d] no evidentiary
burden to establish any of those methods [of showing sexual harassment],” but concluded
that “Plaintiff plead[ed] no facts (or, for that matter, even conclusory allegations) to suggest”
same-sex harassment. Argeropoulos, 2009 WL 2132443, at *4. The court concluded that
the only possible inference from the pleaded facts was that the plaintiff was harassed because
of his sexual orientation, but that Title VII provides no remedy for such harassment. Id.
With respect to the plaintiff’s claims based on national origin discrimination, the court noted
that “[u]nlike with respect to sexual harassment, Plaintiff d[id] at least plead some facts to
suggest that he experienced hostility because of his Greek national origin,” but that the two
incidents discussed in the complaint did not establish discrimination under either a disparate
treatment or hostile work environment theory. Id. With respect to disparate treatment, the
claim failed “because Plaintiff d[id] not plead that he suffered any adverse employment
action, much less an adverse employment action that occurred due to Defendants’ anti-Greek
animus.” Id. The allegations of constructive discharge failed because the plaintiff was still
an employee of the employer defendant, even if he alleged that he had no plans to return to
active work after his disability leave. Id. The hostile work environment claim failed because
although the plaintiff pleaded “two incidents that could arguably be considered national
origin harassment . . . a few ‘isolated incidents,’ especially when only verbal and not
physical, do not suffice to plead a hostile work environment claim.” Id. at *5 (citations

18
Another case in the Second Circuit analyzing pleading the defendant’s state of mind is Talley v. Brentwood Union
Free School District, No. 08-790, 2009 WL 1797627 (E.D.N.Y. Jun. 24, 2009). In Talley, in analyzing whether the
plaintiff had adequately alleged equal protection violations based on termination of her probationary teaching contract,
the court noted that the facts alleged to support the claim were that “(1) plaintiff is white whereas [defendant school
board member] Del Rio is Hispanic and [defendant school board member] Kirkham is white; and (2) at the October 20,
2007 meeting ‘Kirkham stated on the record that there should be more ‘minority teachers’ teaching in [the District] as
it is a minority district’ and is ‘widely known in the district as advocating for more minority teachers to fill positions
within the [District].’” Id. at *7 (third and fourth alterations in original). The court concluded that “[a]lthough not
overwhelmed with this factual support, [it found the complaint] sufficient to state a race based Equal Protection claim
as against Kirkham only.” Id. The court explained that “[a]s to Del Rio and [defendant board member] Fritz, the
amended complaint simply ‘d[id] not contain any factual allegations sufficient to plausibly suggest [their] discriminatory
state of mind.’” Id. (quoting Iqbal, 129 S. Ct. at 1952) (fourth alteration in original).

161

omitted). The court said it was insufficient that the complaint alleged that the two incidents
were only examples of daily discrimination, noting that “this kind of non-specific allegation
might have enabled Plaintiff’s hostile work environment claim to survive under the old ‘no
set of facts’ standard for assessing motions to dismiss, . . . [b]ut it does not survive the
Supreme Court’s ‘plausibility standard,’ as most recently clarified in Iqbal.” Argeropoulos,
2009 WL 2132443, at *6 (emphasis added) (internal citation omitted). The court explained
that “[a]t most, Plaintiff’s national origin hostile work environment claim [wa]s
‘conceivable[,]’ . . . [b]ut without more information concerning the kinds of anti-Greek
animus directed against Plaintiff, and the frequency thereof, the Court [could not] conclude
that Plaintiff’s claim [wa]s ‘plausible.’” Id. (citing Iqbal, 129 S. Ct. at 1951). The court
granted leave to amend this claim “in a manner consistent with Iqbal’s requirements . . . .”
Id.
With respect to the plaintiff’s retaliation claim, the court noted that the plaintiff “fail[ed] to
plead any facts documenting this alleged retaliation,” and that “[a]t most, Plaintiff claim[ed]
that, after he complained about the alleged harassment he suffered, ‘the harassment got
worse’ and Plaintiff ‘became the subject of discriminatory retaliation.’” Id. But the court
noted that the plaintiff “plead[ed] nothing to document how the harassment ‘got worse’ or
how Plaintiff suffered ‘discriminatory retaliation.’” Id. The court explained that “[e]ven
before Iqbal, the federal rules required a plaintiff to do more than just plead ‘labels and
conclusions, and a formulaic recitation of the elements of a cause of action.’” Id. (quoting
Twombly, 550 U.S. at 555) (emphasis added).

District Court Case Law in the Third Circuit
•
Young v. Speziale, No. 07-03129 (SDW-MCA), 2009 WL 3806296 (D.N.J. Nov. 10, 2009).
The plaintiff filed a pro se action under section 1983, asserting that his constitutional rights
were violated when he received inadequate medical care as a pretrial detainee of the United
States Marshals Service. Id. at *1. The complaint alleged that the plaintiff twisted his knee
while at the county jail and was eventually diagnosed with a torn medial meniscus. Id. The
treating physician ordered physical therapy twice a week for six weeks, but defendant
Hanton, a nurse consultant in the Office of Interagency Medical Services in the Marshals
Service Headquarters, approved only a physical therapy evaluation and a one physical
therapy visit. Id. A request for arthroscopic surgery on the plaintiff’s knee was later
forwarded to Hanton, but she denied the request. Id. The plaintiff sued a variety of officials,
and Hanton moved to dismiss, or alternatively, for summary judgment. Id. The court
determined that the motion ought to be treated as a motion to dismiss, rather than a motion
for summary judgment. Young, 2009 WL 3806296, at *2. Hanton argued that the plaintiff
“fail[ed] to make a prima facie showing of inadequate care under either the Eighth or
Fourteenth Amendments and that even if Plaintiff asserted a viable claim, Defendant Hanton
[wa]s protected by the qualified immunity doctrine.” Id. at *3. The court recognized “the
importance of resolving immunity questions at the earliest possible stage in litigation,” and
therefore turned to that issue first. Id. (citation and internal quotation marks omitted).
However, because “the first step of the qualified immunity analysis ‘is not a question of
162

immunity at all, but is instead the underlying question of whether there is even a wrong to
be addressed in an analysis of immunity,’” the court explained that “the substantive issues
raised by Defendant’s motion to dismiss [we]re effectively subsumed within the immunity
analysis.” Id. (citations omitted).
To prevail on his claim of denial of medical care, the plaintiff had to show: “(1) the existence
of a serious medical need, and (2) behavior on the part of the defendant officials that
constitute[d] deliberate indifference to that need.” Id. at *5. The court found that the
complaint adequately alleged a serious medical need, explaining:
Plaintiff’s torn meniscus was not only recognized by two physicians
as requiring medical treatment, but its debilitating effects, as alleged
in the Second Amended Complaint, would easily be recognizable to
a layperson as requiring medical attention. According to the Second
Amended Complaint, to this date, Young still suffers from pain as a
result of his knee injury. Furthermore, Plaintiff has gained a
significant amount of weight due to the inactivity resulting from his
injury, and he occasionally falls because his injury does not permit
him to maintain balanced footing. As alleged in his complaint,
Plaintiff’s medical need is serious.
Id. (internal citations to the complaint omitted). With respect to the deliberate-indifference
prong, the court noted that the plaintiff alleged that Hanton exhibited indifference both when
she refused to order the amount of physical therapy recommended and when she denied his
surgery. Young, 2009 WL 3806296, at *6. The court held that the reduced physical therapy
did not constitute deliberate indifference because, according to the complaint, “Hanton, after
receiving a recommendation from a physician, approved sufficient physical therapy so that
plaintiff could learn the necessary exercises to perform himself.” Id. (citation omitted).
However, the allegations regarding the denial of surgery were “at this stage in the litigation,
. . . sufficient to state a § 1983 claim.” Id. The court rejected Hanton’s argument that the
allegations were insufficient under Iqbal because they “merely parrot[ed] the legal
requirements of a § 1983 claim and [we]re implausible”:
In Iqbal, the Supreme Court held that a plaintiff seeking to impose
supervisory liability on a § 1983 defendant must allege more than
that the particular defendant “knew of, condoned, and willfully and
maliciously agreed to” violate a plaintiff's constitutional rights.
Although such allegations were held to be insufficient in Iqbal, the
plaintiff’s claims there are distinguishable from those of Young.
Specifically, the plaintiff in Iqbal brought a Bivens action for
discrimination in violation of the First and Fifteenth Amendments.
Such claims require a plaintiff to plead and prove that the defendant
acted with discriminatory purpose. As a result of this particular
requirement, the Supreme Court concluded that mere knowledge on
163

the part of the supervisor was an insufficient basis for Bivens liability,
which it treated as equivalent to § 1983 liability. There is no such
requirement for a § 1983 claim for inadequate medical care arising
under either the Eighth or Fourteenth Amendments. See Estelle v.
Gamble, 429 U.S. 97, 106, 97 S. Ct. 285, 50 L. Ed. 2d 251 (1976)
(outlining requirements necessary to plead a § 1983 claim for
inadequate medical care). The Supreme Court, in Iqbal, even
prefaced its analysis of this issue by recognizing that “[t]he factors
necessary to establish a Bivens [or § 1983] violation will vary with
the constitutional provision at issue.” Iqbal, 129 S. Ct. at 1948.
Iqbal thus does not support the proposition that general allegations
are never sufficient to support a § 1983 claim. See id. at 1949 (“the
pleading standard Rule 8 announces does not require ‘detailed factual
allegations,’ but it demands more than an unadorned,
the-defendant-unlawfully-harmed-me accusation.”) (citing Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167
L. Ed. 2d 929 (2007)).
Id. at *7 (emphasis added) (alterations in original) (additional internal citations omitted).
Besides finding Iqbal to be distinguishable, the court found that the allegations were
sufficiently specific:
In any event, Young’s Second Amended Complaint goes
further and specifically alleges that “[a]s a proximate result of
defendant[’s] denial of medical care to the plaintiff, he suffered direct
physical harm as well as residual physical injury due to the long-term
cumulative effects of being forced to walk on his severely injured
knee.” (Second Am. Compl. ¶ 39.) It is plausible (and can be
inferred from the well-pleaded facts) that these long term effects
resulted, at least in part, because “Defendant Hanton denied the
request for surgery outright.” (Id. ¶ 21.); see also Lanzaro, 834 F.2d
at 346–47 (“[d]eliberate indifference is also evident where prison
officials erect arbitrary and burdensome procedures that ‘result[ ] in
interminable delays and outright denials of medical care to suffering
inmates”); Iqbal, 129 S. Ct. at 1950. Consequently, this Court finds
that Plaintiff’s pleadings adequately allege that Hanton was
deliberately indifferent to Plaintiff’s serious medical needs.
Id. (alterations in original). The court explained that more would be required at the summary
judgment stage, but that the allegations were sufficient to survive the pleadings stage:
While, upon a motion by Defendants for summary judgment,
Plaintiff will have to come forward with evidence demonstrating that
Defendant Hanton knew about Plaintiff’s injury and personally
164

interfered, for non-medical reasons, with Plaintiff’s treatment, at this
stage, the pleadings adequately state a claim against Defendant
Hanton.
Likewise, Defendant Hanton may come forward at a later time
(after Plaintiff has had a chance to engage in further discovery) with
evidence undermining Plaintiff’s allegations; however, at this stage
in the litigation, the Court finds that Plaintiff has adequately alleged
that Defendant was deliberately indifferent to his medical needs. See
Spruill [v. Gillis], 372 F.3d [218,] 237–38 [(3d Cir. 2004)] (“[s]ince
at this stage we are making no judgment about what actually
happened, but only about the sufficiency of the pleadings, we must
take [Plaintiff’s] factual allegations, and the reasonable inferences,
therefrom, as true.”).
Id. at *8 (emphasis added) (fourth and fifth alterations in original) (footnote omitted).
In considering qualified immunity, the court found that the allegations in the complaint were
sufficient to conclude “that it would have been clear to a reasonable officer that [Hanton’s]
actions would have violated a ‘clearly established’ constitutional right.” Young, 2009 WL
3806296, at *8 (citation omitted). The court stated:
Plaintiff has alleged that Hanton denied his request for medically
necessary surgery that was approved by a physician, and that as a
result of said denial, Plaintiff’s medical condition deteriorated and led
to further serious injury. In light of Third Circuit precedent holding
that Estelle’s deliberate indifference standard is satisfied “where
knowledge of the need for medical care is accompanied by the
intentional refusal to provide that care[,]” and that “the threat of
tangible residual injury can establish deliberate indifference,” the
Court finds that a reasonable officer would have known that the
denial of Plaintiff’s surgery request would have violated Plaintiff’s
rights under the Fourteenth Amendment.
Id. (internal citations omitted) (alteration in original). The court noted that qualified
immunity could be asserted again later in the case, but could not be applied at the pleadings
stage. See id. (“While the issue of qualified immunity may be revisited in a later motion for
summary judgment, at this stage of the litigation, where the Court must credit Plaintiff’s
factual allegations and construe the Complaint in the light most favorable to Plaintiff, the
Court finds that Defendant is not entitled to qualified immunity.”) (emphasis added).
Despite the fact that qualified immunity usually prevents discovery, the court concluded that
“at this juncture, discovery [wa]s needed to, at a minimum, determine the players involved
in the denial of Plaintiff’s request for surgery.” Id. at *9. The court explained:

165

Although it “exacts heavy costs in terms of efficiency and
expenditure of valuable time and resources that might otherwise be
directed to the proper execution of the work of the Government, . . .
[l]itigation [may be] be necessary to ensure that officials comply with
the law.” Iqbal, 129 S. Ct. at 1953; see also id. at 1961 (finding that
while it is important to prevent unwarranted litigation from
interfering with the proper functioning of the government, “the law,
after all, provides other legal weapons designed to prevent
unwarranted interference” such as beginning discovery with lower
level government officials before determining whether a case can
proceed to allow discovery related to higher level government
officials) (Breyer, J. dissenting).
Id. (alterations in original).
•

Taylor v. Pittsburgh Mercy Health Sys., Inc., No. 09-377, 2009 WL 2992606 (W.D. Pa.
Sept. 17, 2009). The court denied a motion for more definite statement, noting that
“Twombly and Iqbal notwithstanding, the notice pleading standard still applies in federal
court.” Id. at *2. The court noted that “[a]lthough Defendants assert that the details
regarding Plaintiffs’ alleged pre- and postliminary work and/or training may excuse FLSA
liability, these arguments are better suited for resolution at a later stage in the proceedings.”
Id. at *2 n.1 (internal record citation omitted).

•

Vorassi v. US Steel, No. 09cv0769, 2009 WL 2870635 (W.D. Pa. Sept. 3, 2009). The court
dismissed employment discrimination claims as time-barred. Id. at *1. The court cited preTwombly case law for the proposition that “a court will not accept bald assertions,
unwarranted inferences, or sweeping legal conclusions cast in the form of factual
allegations.” Id. (citing In re Rockefeller Ctr. Props., Inc. Sec. Litig., 311 F.3d 198, 215 (3d
Cir. 2002); Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 n.8 (3d Cir. 1997)). The
court noted that “a plaintiff must put forth sufficient facts that, when taken as true, suggest
the required elements of a particular legal theory,” id. at *2 (citation omitted), but explained
that “this standard does not impose a heightened burden on the claimant above that already
required by Rule 8, but instead calls for fair notice of the factual basis of a claim while
‘rais[ing] a reasonable expectation that discovery will reveal evidence of the necessary
element.’” Id. (emphasis added) (alteration in original) (citation omitted); see also Koynok
v. Lloyd, No. 06cv1200, 2009 WL 2981953, at *3 (W.D. Pa. Sept. 11, 2009) (same).

•

Adams v. Lafayette College, No. 09-3008, 2009 WL 2777312 (E.D. Pa. Aug. 31, 2009). In
an employment discrimination case based on alleged age discrimination, the court concluded
that the plaintiff’s pleading was insufficient because it was conclusory and devoid of factual
details, and better explained by lawful conduct. Id. at *3–4. The court rejected the
plaintiff’s argument, based on “the liberal pleading discussion in Swierkiewicz,” that
requiring more detailed pleading “would improperly limit a plaintiff’s ability to raise a
discrimination claim by requiring the plaintiff to muster the crucial evidence, which is most
166

often in the defendants’ hands, before discovery.” Id. at *4 (citations omitted). The court
explained that “[c]ontrary to plaintiff’s position, the Fowler decision specifically noted the
Supreme Court’s indirect repudiation of the Swierkiewicz ruling to the extent it relies on
Conley and its ‘no set of facts’ requirements.” Id. (citation omitted). But the court explained
that the complaint was deficient even under Swierkiewicz:
More importantly, Adams overlooks the key factual
distinctions between his case and Swierkiewicz. In that case, the
Court specifically noted the complaint easily satisfied the
requirements of Rule 8(a) because it “detailed the events leading to
termination, provided relevant dates, and included the ages . . . of at
least some of the relevant persons involved with his [adverse
employment action].” Swierkiewicz, 534 U.S. at 514. On the other
hand, Adams’s complaint[’s] factual allegations are scant and rely
primarily on his own averments that he has been treated differently
because of his age. Though Adams has sufficiently plead[ed] he was
suspended for one day for turning his back to his supervisor, he has
failed to allege sufficient facts to nudge his claim from conceivable
to plausible.
Id. (omission and first alteration in original) (footnote omitted). The court emphasized that
the facts necessary to survive the pleadings stage are minimal:
My ruling should not be construed as requiring potential
plaintiffs to muster all facts necessary for their claim before the
complaint is filed. As discussed earlier, the Federal Rules of Civil
Procedure have consistently been interpreted as providing a liberal
pleading standard. To be sure, the Twombly and Iqbal decisions
have clarified the minimal pleading standards by rejecting formulaic
recitations of the elements of a cause of action as well as allegations
consisting only of labels or conclusions. Additionally, the complaint
must . . . recite facts sufficient to show a plausible claim of relief.
Here, the complaint is dismissed because it fails to clear
minimal procedural hurdles. Careful analysis of the allegations
reveal they are only conclusory restatements of the elements of an
employment discrimination claim. Adams has certainly stated facts
for a conceivable claim but falls short of demonstrating a plausible
claim of relief.
Id. at *4 n.2 (emphasis added).
•

Garczynski v. Countrywide Home Loans, Inc., --- F. Supp. 2d ----, No. 08-5128, 2009 WL
2476622 (E.D. Pa. Aug. 12, 2009). The court concluded that the factual allegations were
167

insufficient to allege that the defendant violated the state unfair trade practices and consumer
protection law, finding that they were “essentially no more than a restatement of the
elements of the statute.” Id. at *6. The court stated: “Plaintiffs cannot adequately plead that
Countrywide violated the UTPCPL simply by pasting the language of the statute into their
Amended Complaint.” Id. The court commented:
Although Twombly and Iqbal have been criticized as both
ignoring the liberal concept of notice pleading and representing an
unwarranted change in Supreme Court jurisprudence on the adequacy
of pleadings, the Complaint in the present case is a good example of
why allowing a case to proceed simply on its allegations of statutory
elements, which some might equate with notice pleading, can be
unfair in some cases. The relationship between the parties in this
case is based on contract. If Plaintiffs had grounds to believe that
Defendants had violated the contract, a claim for breach of contract
would surely be proper. However, Plaintiffs’ claims are based solely
on alleged oral representations, which Plaintiffs claim induced them
to enter into the mortgage agreement. If, as Plaintiffs allege, they did
not understand the mortgage agreement, they should not have signed
it or sought services of a lawyer or written clarification from
Countrywide. Allowing a claim of this nature to proceed when the
terms of the written documents are clearly contrary to the Plaintiffs’
allegations would not only violate Iqbal and Twombly, but other
long-standing principles of federal jurisprudence.
Id. at *6 n.6 (emphasis added) (citation omitted).
•

Carpenters Health & Welfare Fund of Philadelphia v. Kia Enters. Inc., No. 09-116, 2009
WL 2152276 (E.D. Pa. Jul. 15, 2009). The plaintiffs sued to collect money allegedly owed
under a collective bargaining agreement and related trust agreements, and the defendant filed
a counterclaim, alleging that in seeking to collect the payments, the plaintiffs had violated
the Civil Rights Act of 1866. Id. at *1. The court concluded that the counterclaim was
insufficient under Iqbal:
The Supreme Court’s clarification of federal pleading
standards in Twombly and Iqbal has raised the bar for claims to
survive a motion to dismiss by emphasizing that a plaintiff cannot
rely on legal conclusions or implausible inferences from factual
allegations to state a claim. Measured against this clarified standard,
Kia’s amended counterclaim fails.
The amended counterclaim’s allegations that the Carpenter’s
Union has a “longstanding pattern and practice” of discriminating
against minorities and minority-owned businesses and the allegations
168

that the plaintiffs’ actions were intentional and motivated by racial
animus and a desire to exclude minorities and minority-owned
businesses from the construction industry are all legal conclusions
that under Iqbal and Twombly are not entitled to be assumed to be
true.
The factual allegations in the amended counterclaim concern
actions by the plaintiffs to collect the payments they claim Kia owes
them. The amended counterclaim alleges that the plaintiffs took steps
to make a claim against Kia’s performance bond, sought to persuade
a city agency to withhold payments to Kia, and demanded to audit
Kia’s books and records. These actions are entirely consistent with
a lawful attempt by the plaintiffs to collect unpaid CBA obligations
that they are owed. By themselves, these allegations are “not only
compatible with, but more likely explained by,” lawful behavior and
therefore cannot “plausibly suggest” actionable wrongdoing. Iqbal,
129 S. Ct. at 1950. Kia’s allegations that the plaintiffs took similar
steps against another minority-owned business . . . are also entirely
consistent with lawful actions by the plaintiffs to collect unpaid CBA
payments.
Kia has attempted to plead sufficient additional facts to
“nudge” its allegations of discrimination across the “line from
conceivable to plausible” by alleging, on information and belief, that
the plaintiffs do not make similar efforts to collect unpaid CBA
obligations from non-minority-owed businesses. Kia, however,
offers no specific facts in support of the plaintiffs’ alleged disparate
treatment of minority and non-minority businesses. In the absence of
any more specific allegations identifying particular instances of
disparate treatment, these allegations are merely “legal conclusions
couched as factual allegations,” which under Twombly and Iqbal
cannot be taken as true.
Kia’s allegations that the Carpenter’s Union refused to
cooperate with the Mayor’s Advisory Commission and has a
“historical and present day antipathy” to racial minorities are also not
enough to make Kia’s discrimination claims plausible. Even if taken
as true, these allegations are not probative to the question of whether
the specific actions taken by the plaintiffs against Kia can be
plausibly alleged to have been motivated by discrimination.
Id. at *3 (emphasis added).

169

District Court Case Law in the Fourth Circuit
•
Fed. Trade Comm’n v. Innovative Mktg., Inc., --- F. Supp. 2d ----, 2009 WL 2959680 (D.
Md. Sept. 16, 2009). The Federal Trade Commission (FTC) brought suit under the Federal
Trade Commission Act (FTCA) for alleged deceptive conduct in connection with the sale
of software. Id. at *1. In response to the FTC’s argument that “the Iqbal decision does not
represent a ‘sea change in the law of pleading,’” the court noted that “Iqbal’s importance
cannot be minimalized,” and that Twombly and Iqbal “represent a new framework for
reviewing the sufficiency of complaints under Rule 8.” Id. at *2 n.2. In denying the motion
to dismiss, the court found that the factual allegations were sufficient, and rejected the
defendant’s assertion that a stricter pleading standard applied:
In the face of such thorough pleading, D’Souza advocates for
this Court to apply an unduly stringent pleading standard and dismiss
the Complaint. Indeed, Defendant seems to argue for a pleading
standard akin to the particularity requirement prescribed for claims
of fraud under FED. R. CIV. P. 9(b)—a heightened standard that does
not apply [to] section 5(a) claims under the FTC Act. Twombly and
Iqbal may have raised the bar for stating a claim under Rule 8, but
not to the extent proposed by D’Souza. Rule 8 remains a liberal
standard—a complaint need only set forth a “short and plain
statement” that gives a defendant fair notice of plaintiff’s grounds for
entitlement for relief. FED. R. CIV. P. 8(a)(2). Indeed, in Iqbal, the
Court emphasized the appropriate approach under the plausibility
standard by noting that it was not a “‘probability requirement,’ but it
asks for more than a sheer possibility that a defendant has acted
unlawfully.” Iqbal, 129 S. Ct. at 1949 (quoting Twombly, 550 U.S.
at 556). Stated otherwise, a plaintiff need only plead sufficient facts
to “nudg[e]” a claim “across the line from conceivable to plausible.”
Twombly, 550 U.S. at 570.
Id. at *7 (emphasis added) (second alteration in original) (additional internal citations
omitted). The court denied the motion to dismiss, finding that “[t]hrough its extensive
factual pleadings, the FTC has positioned its claims against Marc D’Souza safely within the
realm of plausibility.” Id.
•

Boy Blue, Inc. v. Zomba Recording, L.L.C., No. 3:09-CV-483-HEH, 2009 WL 2970794
(E.D. Va. Sept. 16, 2009). The court examined whether pleading on information and belief
can be appropriate, and explained:
This Court must therefore consider whether a pleading “upon
information and belief,” without further factual support, is sufficient
to state an actionable claim. Pleading “upon information and belief”
is appropriate when the factual basis supporting a pleading is only
available to the [opposing party] at the time of pleading. See, e.g.,
170

Boykin v. KeyCorp, 521 F.3d 202, 215 (2d Cir. 2008) (holding that
pleading upon “information and belief” is appropriate when the
information is in the opposing party’s possession); Johnson v.
Johnson, 385 F.3d 503, 531 n.19 (5th Cir. 2004) (“‘information and
belief’ pleadings are generally deemed permissible under the Federal
Rules, especially in cases in which the information is more accessible
to the defendant.”). The Court finds that any facts establishing [one
of the elements of tortious interference] could, at this stage of the
proceedings, be entirely within the possession of the opposing
parties. In this circumstance, a pleading “upon information and
belief” survives a 12(b)(6) challenge. The dignity accorded
“information and belief” pleadings has more limited application in
other contexts.
Id. at *2. The court noted that with respect to the allegations regarding the other elements
of the claim, “[t]hey [we]re nothing more than a listing of the required element with
Defendant Zomba’s or Sony Music’s name inserted as the offending party,” and concluded
that “[s]tripped of such legal incantation, these allegations provide[d] no factual support for
the remaining elements of Plaintiff’s tortious interference claim.” Id. at *3.
•

King v. United Way of Cent. Carolinas, Inc., No. 3:09CV164-MR-DSC, 2009 WL 2432706
(W.D.N.C. Aug. 6, 2009). The plaintiff alleged, among other claims, race, gender, and age
discrimination and retaliation under § 1981, Title VII, and the Age Discrimination in
Employment Act (ADEA). The court found that the allegation that “‘upon information and
belief . . . the [defendant’s] decision [to terminate the plaintiff] was made, at least in part, on
the basis of the Board’s perception of the discomfort of the Charlotte community with the
idea of an African-American woman earning so much money’” was insufficient because the
only facts mentioning race in the complaint related to blogs and internet postings not
authored by the defendants. Id. at *8. The court concluded that “Plaintiff’s assertion that
UWCC’s decision to terminate her was based on community discomfort with her race/gender
and compensation [wa]s precisely the type of factually-unsupported, conclusory allegation
that the Court must disregard.” Id. (citing Iqbal, 129 S. Ct. at 1951). The court also found
that there were no factual allegations supporting the conclusion in the complaint that the
plaintiff’s interim replacement, who was white and male, was picked because the defendant
“concluded that it was ‘more palatable for a white man to receive a generous salary than a
black woman.’” Id. at *9. The court stated: “The Complaint contains no other allegations,
conclusory or otherwise, that UWCC hired [the plaintiff’s interim replacement] because of
his race, gender, or age.” Id. With respect to age discrimination, the only factual allegation
was the plaintiff’s date of birth and her age. Id. The court also dismissed the retaliation
claim because “even having taken the Complaint’s well-pleaded factual allegations as true,
judicial experience and common sense dictate that it is more likely that UWCC terminated
[the plaintiff’s] employment because she could no longer lead UWCC effectively in the
wake of the public reaction to the disclosure of her compensation and that UWCC chose
Everett as her interim replacement because he is a respected local figure.” King, 2009 WL
171

2432706, at *9.
•

Fletcher v. Philip Morris USA Inc., No. 3:09CV284-HEH, 2009 WL 2067807 (E.D. Va.
Jul. 14, 2009). The plaintiff alleged race and gender discrimination and retaliation under
Title VII and race discrimination under § 1981 against his employer. The court concluded
that the plaintiff had inadequately alleged discrimination under Title VII and § 1981 because
although the plaintiff alleged an adverse employment action, there were no specific factual
allegations that similarly situated employees, who were not members of a protected class,
received more favorable treatment, or that the defendants acted with discriminatory intent.
Id. at *6. The court found that “it would be difficult for a reasonable person to conclude that
the factual allegations in the Amended Complaint even give rise to the suggestion of
discrimination,” noting that the decisionmakers involved in the adverse employment
decisions were members of the same race as the plaintiff, and one was also a male, and the
defendants replaced the plaintiff with a person of the same race and gender as the plaintiff.
Id. at *7. The court found the retaliation claim insufficient as well because the court could
“find no indication from the facts as pled that Plaintiff’s race or gender played any role in
the low-performance ratings that led to Plaintiff’s internal complaint,” and the complaint
therefore did not constitute a protected activity under Title VII. Id. at *8. The plaintiff’s
EEOC charge did constitute a protected activity, but the retaliation claim still failed because
the alleged adverse actions either did not rise to the level of a true adverse action or there
was no causal connection alleged between the adverse action and the alleged retaliation. Id.
at *9–10.

District Court Case Law in the Fifth Circuit
•
Lehman Bros. Holdings, Inc. v. Cornerstone Mortgage Co., No. H-09-0672, 2009 WL
2900740 (S.D. Tex. Aug. 31, 2009). The court dismissed a counterclaim for attorneys’ fees
under state law, noting that the “allegations as to the breach [of contract supporting the
request for attorneys’ fees] [we]re scant.” Id. at *5. The court concluded:
To the extent Cornerstone alleges breach of contract, it fails
to plead sufficiently under the standards that applied even before
Twombly and Iqbal. Cornerstone has simply alleged that a contract
was breached by a failure properly to service the loans and to give
notice. This bare-bones allegation neither provides fair notice of the
claim nor of the grounds on which it rests. Because the Rule 8
standard is not satisfied, dismissal with leave to amend under Rule 12
is appropriate.
Id. (emphasis added).

District Court Case Law in the Seventh Circuit
•
Mounts v. United Parcel Serv. of Am., Inc., No. 09 C 1637, 2009 WL 2778004 (N.D. Ill.
172

Aug. 31, 2009). The plaintiffs, retired drivers for UPS, alleged retaliation and discrimination
in connection with their formation of an organization that assisted current and retired UPS
employees with filing complaints with the EEOC and with securing medical and retirement
benefits. In considering the retaliation claims, the court noted that “[t]he level of facts
required varies with the type of claim asserted,” and that “[c]omplaints ‘alleging illegal
retaliation on account of protected conduct must provide some specific description of that
conduct beyond the mere fact that it is protected.’” Id. at *4 (quoting E.E.O.C. v. Concentra
Health Servs., Inc., 496 F.3d 773, 781 (7th Cir. 2007)). The court noted that the remaining
plaintiffs had alleged that they helped another plaintiff in the investigation regarding his
charge of discrimination and that UPS removed them from the health plan for retired
employees because of that assistance. Id. at *5. The court concluded that because the
plaintiffs alleged that their assistance related to another plaintiff’s discrimination under the
ADEA and the ADA, and retaliation under Title VII, the allegations were sufficient to state
a claim for retaliation under those statutes. Id. The court also concluded that the remaining
plaintiffs had adequately alleged discrimination under the ADEA because they alleged that
they were over 40 years old and that UPS found them ineligible to participate in the health
plan because of their age. Id. The court found that the plaintiffs failed to state a claim for
discrimination under the ADA because they did not allege that they suffered from an
impairment, let alone an impairment that substantially limited their ability to perform a
major life activity. Id. at *6. The court denied leave to replead the discrimination claim
under the ADA because the plaintiffs conceded that they were not UPS employees, and
retired employees had no right to bring discrimination suits under Title I of the ADA.
Mounts, 2009 WL 2778004, at *6.
•

Fulk v. Village of Sandoval, No. 08-843-GPM, 2009 WL 1606897 (S.D. Ill. Jun. 9, 2009).
Police officers claimed they were fired in retaliation for reporting the mayor’s misconduct.
Id. at *1. The defendants claimed that the police officers were speaking pursuant to their
official duties and that as a result, their words enjoyed no First Amendment protection. Id.
at *2. The court concluded that although the plaintiffs pleaded that they complained as
private citizens, not as part of their official duties, “[t]he bare allegation that they made the
statements as private citizens [wa]s not sufficient to move th[e] allegation from
‘conceivable’ to ‘plausible’ under the Ashcroft standard.” Id. However, “[b]ecause of the
recent change in federal pleading standards,” the court granted leave to amend “to allege
sufficient facts to show they acted as private citizens.” Id.

District Court Case Law in the Eighth Circuit
•
Turner v. Sikeston Police Dep’t, No. 1:09CV92 LMB, 2009 WL 2836513 (E.D. Mo. Aug.
31, 2009). The plaintiff brought claims under § 1983, alleging violations of his
constitutional rights. The plaintiff alleged that he was falsely arrested, that his home was
unlawfully searched, that he was unlawfully retained in the county jail, that a police officer
used a false affidavit that prompted the prosecutor’s office to initiate a malicious
prosecution, that after his arrest he was placed in unpleasant conditions, and that other
defendants failed to properly supervise and train the police officer who searched the
173

plaintiff’s home and created the allegedly false affidavit. See id. at *2. The court noted that
in evaluating a complaint, Iqbal requires engaging in a two-step inquiry. Id. at *1. The
court explained that the plaintiff’s “allegations are mostly conclusory and such conclusory
allegations need not . . . be given an assumption of truth.” Id. at *2 (citing Iqbal, 129 S. Ct.
at 1950–51). The court noted that the complaint did not “identify whether the members of
the prosecutor’s office knew that defendant [police officer] Rataj’s affidavit was purportedly
false,” and that the plaintiff’s “allegations of misconduct with regard to the prosecutor’s
office [we]re stated on ‘information and belief.’” Id. The court concluded that the plaintiff’s
claims of false imprisonment, false arrest, and malicious prosecution failed to state a claim
because “[a] prisoner may not recover damages in a § 1983 suit where the judgment would
necessarily imply the invalidity of his conviction, continued imprisonment, or sentence
unless the conviction or sentence is reversed, expunged, or called into question by issuance
of a writ of habeas corpus.” Id. (citations omitted). Regardless of this conclusion, the court
found that the malicious prosecution claims against the prosecutors could not proceed
because the plaintiff had “not alleged any facts supporting his assertions that he was
maliciously prosecuted,” and because the prosecutors were entitled to absolute immunity.
See Turner, 2009 WL 2836513, at *3 (citation omitted). The claims against the police
department failed because the police department was not an entity that could be sued. Id.
The claims regarding the conditions of the plaintiff’s confinement failed because the plaintiff
did not allege a person responsible and did not allege “that the purported deprivations denied
him the minimal civilized measure of life’s necessities and that defendants were deliberately
indifferent to excessive risk to his health or safety.” Id. (citations omitted). Finally, the
court concluded that the claims of inadequate training failed to state a plausible claim
because they were based on conclusory allegations. See id. (citing Iqbal, 129 S. Ct. at
1950–51). The court allowed the claim that the police officer illegally searched the
plaintiff’s home to go forward. Id.

District Court Case Law in the Ninth Circuit
•
Westerfield v. Spinks, No. 2:08-CV-1970-RCF, 2009 WL 3042418 (E.D. Cal. Sept. 15,
2009). In evaluating a pro se prisoner complaint alleging inadequate medical treatment, the
court concluded that the complaint’s allegation that the plaintiff was “left for dead by MTA
Spinks” after he had a heart attack and was later rushed to the hospital and received medical
treatment, was “both inadequate and implausible.” Id. at *2. The court explained that
“[a]lthough ignoring an individual suffering a heart attack creates a condition posing a risk
of serious harm, Westerfield does not offer any allegations concerning Spinks’ knowledge
of the danger or how he was brought to a hospital if he was being ignored.” Id. The court
concluded that “‘[a] conclusory allegation to the effect that [Spinks] knew that [Westerfield]
had a heart attack is insufficient. [Westerfield] must allege specific facts ‘plausibly
showing’ that [Spinks] had the requisite mental state.’” Id. (second, third, fourth, and fifth
alterations in original) (quoting Brown v. Lewis, No. 2:07-cv-2433, 2009 WL 1530681, at
*1 (E.D. Cal. Jun. 1, 2009)).19
19

In Brown v. Lewis, the prisoner’s complaint under § 1983, which alleged that the prison’s medical technician and

174

•

Elan Microelectronics Corp. v. Apple, Inc., No. C 09-01531, 2009 WL 2972374 (N.D. Cal.
Sept. 14, 2009). In a patent infringement action, the court noted that “Apple’s allegation of
infringement in all three of the challenged counterclaims consist[ed] of nothing more than
a bare assertion, made ‘on information and belief that Elan ‘has been and is currently,
directly and/or indirectly infringing, in violation of 35 U.S.C. § 271’ the specified patents
‘through its design, marketing, manufacture and/or sale of touch sensitive input devices or
touchpads, including but not limited to the Smart-Pad.’” Id. at *2. The court explained that
“[w]hile the line between facts and legal conclusions is not always easy to draw, this
pleading plainly f[ell] within the prohibition against ‘[t]hreadbare recitals of the elements
of a cause of action, supported by mere conclusory statements.’” Id. (third alteration in
original) (quoting Iqbal, 129 S. Ct. at 1949). With respect to the “plausibility” aspect of
Twombly/Iqbal, the court noted that “[a]t this juncture, the allegations of fact [we]re so
sparse that it [wa]s difficult to analyze plausibility, although nothing in what ha[d] been
alleged raise[d] any significant plausibility concerns,” but concluded that “[b]ecause the
claims fail[ed] under Iqbal’s ‘first’ principle, the Court [did not] need [to] further address
this point.” Id. The court noted that the Federal Circuit, in McZeal v. Sprint Nextel Corp.,
501 F.3d 1354 (Fed. Cir. 2007), had concluded that a pro se pleading based on conclusory
allegations survived dismissal, relying on the pleading form for patent infringement. Elan
Microelectronics, 2009 WL 2972374, at *2. The court concluded that “[i]t is not easy to
reconcile Form 18 [for direct patent infringement] with the guidance of the Supreme Court
in Twombly and Iqbal; while the form undoubtedly provides a ‘short and plain statement,’
it offers little to ‘show’ that the pleader is entitled to relief,” but noted that “[u]nder Rule 84
of the Federal Rules of Civil Procedure, however, a court must accept as sufficient any
pleading made in conformance with the forms.” Id. (footnote omitted). The court found that
since Form 18 addresses only direct infringement, and Apple asserted direct and/or indirect
infringement, neither the McZeal case nor Form 18 supported allowing Apple’s
counterclaims to proceed. Id.
In considering the impact of Rule 11(b)(3), the court noted that “regardless of what
knowledge may lie exclusively in the possession of Elan or others, Apple should be able to
articulate at least some facts as to why it is reasonable to believe there is infringement,” and
concluded that “[s]imply guessing or speculating that there may be a claim is not enough.”
Id. at *4 (emphasis added) (footnote omitted). But the court cautioned:
This is not to say that Apple necessarily must plead any or all such
facts to state a claim; indeed some of them could be protected by

nurse failed to diagnose the plaintiff with a heart attack, was insufficient to allege the requisite mental state of deliberate
indifference because the plaintiff must show that the defendants knew of and disregarded an excessive risk to the
plaintiff’s health. 2009 WL 1530681, at *1. The court also found that the complaint failed to allege whether the plaintiff
was ever diagnosed with a heart attack or what led him to believe he had a heart attack, and did not describe how the
alleged misdiagnosis injured him. Id. Finally, the complaint alleged no facts connecting the nurse to the incident. Id.
Despite dismissing the complaint for the second time for failure to state a claim, the court granted leave to amend. Id.
at *2.

175

privilege or the work product doctrine. However, in at least some
situations, a party might be able to plead a great number of
circumstantial facts supporting a belief of wrongdoing, while still
needing discovery to “confirm the evidentiary basis” of the
allegations.
Id. at *4 n.5.
•

McClelland v. City of Modesto, No. CV F 09-1031 AWI dlb, 2009 WL 2941480 (E.D. Cal.
Sept. 10, 2009). The plaintiff brought a civil rights action based on the execution of a search
warrant at the plaintiff’s home that resulted in injury to the plaintiff. Id. at *1. The plaintiff
alleged that her Fourth and Fourteenth Amendment rights were violated under § 1983. Id.
at *2. In evaluating the motions to dismiss, the court noted that “[a]lthough there is some
debate as to whether the Supreme Court’s decision in Twombly worked ‘a sea change in the
law of pleadings,’ the fact remains that, since Twombly, the requirement for fact pleading
has been significantly raised.” Id. at *5 (citing Moss, 572 F.3d at 972) (emphasis added).
The court dismissed some of the claims, but granted leave to amend. Id. In refusing to
dismiss the plaintiff’s negligence claim against the individual defendants, the court held that
“[w]hile it [wa]s certainly possible that Plaintiff could have pled causation and duty of care
with more particularity, the fact remain[ed] that Plaintiff ha[d] pled facts which, if proven,
could support a determination by the finder of fact that the individual officers executing the
search warrant acted unreasonably and without due care for Plaintiff’s physical limitations.”
Id. at *10.

•

Young v. City of Visalia, --- F. Supp. 2d ----, No. 1:09-CV-115 AWI GSA, 2009 WL
2567847 (E.D. Cal. Aug. 18, 2009). The plaintiffs asserted civil rights violations under §
1983, alleging a search that exceeded the scope of a warrant and unlawful detention. See id.
at *1–2. The court noted that “‘[c]ontext matters in notice pleading. Fair notice under [Rule
8(a)] depends on the type of case.’” Id. at *2 (alterations in original) (quoting Phillips v.
County of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008); citing Iqbal, 129 S. Ct. at 1950).
The court noted that prior Ninth Circuit precedent regarding pleading municipal liability
under § 1983 appeared to have been abrogated by Iqbal:
[W]ith respect to municipal liability, the Ninth Circuit has held that,
“a claim of municipal liability under section 1983 is sufficient to
withstand a motion to dismiss even if the claim is based on nothing
more than a bare allegation that the individual officers’ conduct
conformed to official policy, custom, or practice.” Whitaker v.
Garcetti, 486 F.3d 572, 581 (9th Cir. 2007). However, Iqbal has
made clear that conclusory, “threadbare” allegations that merely
recite the elements of a cause of action will not defeat a motion to
dismiss. See Iqbal, 129 S.Ct. at 1949–50. In light of Iqbal, it would
seem that the prior Ninth Circuit pleading standard for Monell claims

176

(i.e. “bare allegations”) is no longer viable.20
Id. at *6. The court dismissed the claim “[b]ecause the Complaint contain[ed] insufficient
facts that plausibly indicate[d] a valid Monell claim . . . .” Id. at *7.
•

Doe ex rel. Gonzales v. Butte Valley Unified Sch. Dist., No. 09-245 WBS CMK, 2009 WL
2424608 (E.D. Cal. Aug. 6, 2009). The plaintiff brought suit under § 1983 against his
teacher and the school district’s superintendent, alleging violations of his civil rights because
of sexual abuse and harassment allegedly committed by other students. Id. at *1. The
plaintiff also sued the school district, alleging sexual discrimination, and asserted a state law
negligence claim against the teacher and superintendent. Id. The teacher and superintendent
moved to dismiss the § 1983 claim.
The court granted the motion with respect to the substantive due process claim asserted on
the basis of an exception to the rule that failure to protect from harm does not create a due
process violation, finding that the conclusory allegation that the defendants had a special
relationship with the plaintiff was not sufficient to establish the “special relationship”
exception. Id. at *3. With respect to another exception—the “danger creation”
exception—the court granted the teacher’s motion to dismiss because there were no
allegations of an affirmative act by the teacher that created or exposed the plaintiff to the risk
of harm, but denied the superintendent’s motion on this issue because the plaintiff alleged
affirmative conduct and the superintendent’s only response was that he was taking action
pursuant to state law by educating the accused students. Id. at *4–5. The court dismissed
the procedural due process claim because “nowhere d[id] plaintiff allege that he had a
property interest in a safe school or that defendants’ conduct amounted to a deprivation of
that interest without proper procedural safeguards.” Id. at *5.
With respect to the equal protection claim, the court found that the “bare legal assertion that
[the defendants] ‘intentionally discriminated’ again[st] him [wa]s insufficient to satisfy Rule
8 . . . and [could not] withstand a motion to dismiss.” Doe, 2009 WL 2424608, at *6. The
court also found the allegation that the superintendent “‘fail[ed] to provide or obtain
education for [the teacher]’ d[id] not sound in unconstitutional discrimination toward
plaintiff.” Id. at *7 (first alteration in original). The court speculated as to a possible theory
for liability, but explained, “[o]f course, plaintiff may very well have a different theory or
no theory at all, and for this reason, the Supreme Court has made clear that district courts are
not free to coax a hapless complaint into compliance with federal pleading standards.” Id.
(citing Twombly, 550 U.S. at 561–63). The court granted the motion to dismiss with respect
to the equal protection claims. Id.

20

See also Lewis v. City of Fresno, No. CV-F-08-1062, 2009 WL 2905738, at *10 (E.D. Cal. Sept. 4, 2009) (concluding
that prior to Twombly and Iqbal, the allegation that “‘Defendants . . . used and/or allowed official policies, procedures
and/or practices to discriminate against Plaintiff on the basis of his race’” would have been sufficient to survive a motion
to dismiss because the Ninth Circuit had held that “an allegation based on nothing more than a bare averment that the
official’s conduct conformed to official policy, custom or practice suffice[d] to state a Monell claim under § 1983,” but
that such an allegation was not sufficient under Twombly and Iqbal).

177

In considering whether to grant leave to amend, the court noted Iqbal’s effect on pleading
standards and the federal forms:
Although Iqbal’s majority opinion itself did not intimate any
seachange, jurists and legal commentators have observed that the
decision marks a striking retreat from the highly permissive pleading
standards often thought to distinguish the federal system from “the
hyper-technical, code-pleading regime of a prior era,” 129 S. Ct. at
1949. See, e.g., Moss v. U.S. Secret Serv., --- F.3d ----, No.
07-36018, 2009 WL 2052985, at *8 (9th Cir. July 16, 2009); Adam
Liptak, 9/11 Case Could Bring Broad Shift on Civil Suits, N.Y.
TIMES, July 21, 2009, at A10.
Prior to Iqbal, many courts—including this court and,
apparently, the Supreme Court itself—read Rule 8 to express a
“willingness to ‘allow [ ] lawsuits based on conclusory allegations .
. . to go forward,’” Maduka v. Sunrise Hosp., 375 F.3d 909, 912 (9th
Cir. 2004) (quoting Swierkiewicz v. Sorema N.A., 534 U.S. 506, 514,
122 S. Ct. 992, 152 L. Ed. 2d 1 (2002)) (alteration in original).
Indeed, for over half a century, district courts had been instructed that
the “short plain statement” required by Rule 8 “must simply ‘give the
defendant fair notice of what the plaintiff’s claim is and the grounds
upon which it rests.’” Swierkiewicz, 534 U.S. at 514 (quoting
Conley, 355 U.S. at 47). Now, however, even the official Federal
Rules of Civil Procedure Forms, which were touted as “sufficient
under the rules and . . . intended to indicate the simplicity and brevity
of the statement which the rules contemplate,” FED. R. CIV. PROC. 84,
have been cast into doubt by Iqbal. See, e.g., FED. R. CIV. P. Form 9
(setting forth a complaint for negligence in which the plaintiff simply
states, “On June 1, 1936, in a public highway called Boylston Street
in Boston, Massachusetts, defendant negligently drove a motor
vehicle against plaintiff who was then crossing said highway”).21
Id. at *8 (emphasis added) (alteration and omissions in original). The court dismissed the
complaint, but granted leave to amend. Id. at *9.

21

Twombly seemingly approved of the adequacy of pleading under Form 9, distinguishing the notice given in the model
form from the notice given in the complaint in Twombly. See Twombly, 550 U.S. at 565 n.10 (noting that the lack of
notice in the complaint in Twombly “contrasts sharply with the model form for pleading negligence,” and that “[w]hereas
the model form [9] alleges that the defendant struck the plaintiff with his car while plaintiff was crossing a particular
highway at a specified date and time, the complaint here furnishes no clue as to which of the four ILECs (much less
which of their employees) supposedly agreed, or when and where the illicit agreement took place”). The Court explained
that “[a] defendant wishing to prepare an answer in the simple fact pattern laid out in Form 9 would know what to
answer; a defendant seeking to respond to plaintiffs’ conclusory allegations in the § 1 context would have little idea
where to begin.” Id.

178

•

Ibrahim v. Dep’t of Homeland Sec., No. C 06-00545 WHA, 2009 WL 2246194 (N.D. Cal.
Jul. 27, 2009). The plaintiff sued because her name was placed on a “no-fly list” and she
encountered numerous difficulties as a result. In part, the plaintiff’s suit involved
discrimination claims against the San Francisco Airport, the City and County of San
Francisco, the San Francisco Police Department, and two San Francisco police officers
(collectively, the “San Francisco defendants”), and John Bondanella, an employee of the
private corporation United States Investigations Services, Inc. The plaintiff alleged that the
San Francisco defendants and Bondanella discriminated against her on the basis of her
national origin and religious beliefs by detaining her. Id. at *8. The court concluded that
the allegation that the plaintiff was placed on the non-fly list did not support the
discrimination claim against these defendants because the list was compiled and maintained
by the federal government, not the defendants. Id. at *9. The court found that the
allegations that the plaintiff was arrested because she was Muslim and a Malaysian citizen
and that the defendants acted in a discriminatory manner, with the intent to discriminate
based on the plaintiff’s religion and national origin, were conclusory statements that were
not sufficient to survive a motion to dismiss. Id. The court explained:
Ibrahim has not pleaded that defendants took action because
of and not merely in spite of her being a Muslim and a Malaysian
citizen. That plaintiff was Muslim and detained is not enough to
draw an inference of discrimination under the Iqbal standard. No
additional facts, such as derogatory statements, are alleged.
Accordingly, as pled, the discrimination claims against San Francisco
officers or Bondanella are insufficient.
Id. at *10. The court questioned whether Iqbal imposed a harsh standard:
A good argument can be made that the Iqbal standard is too
demanding. Victims of discrimination and profiling will often not
have specific facts to plead without the benefit of discovery. District
judges, however, must follow the law as laid down by the Supreme
Court. Yet, the harshness is mitigated here. Counsel for the San
Francisco defendants and Bondanella admit that plaintiff’s Fourth
Amendment claim can go forward. This means that discovery will go
forward. During discovery, Ibrahim can inquire into facts that bear
on the incident, including why her name was on the list. If enough
facts emerge, then she can move to amend and to reassert her
discrimination claims at that time.
Id. (emphasis added). The court also concluded that the allegation that one of the officers
temporarily removed the plaintiff’s hijab to search underneath did not adequately plead an
equal protection violation. Ibrahim, 2009 WL 2246194, at *10.

•

Consumer Prot. Corp. v. Neo-Tech News, No. 08-1983-PHX-JAT, 2009 WL 2132694 (D.
179

Ariz. Jul. 16, 2009). The plaintiff alleged a violation of the Telephone Consumer Protection
Act of 1991 (TCPA), civil conspiracy, and aiding and abetting a violation of the TCPA,
based on the plaintiff’s receipt of an unsolicited fax advertising a stock. Id. at *1. The court
cited both Twombly itself and pre-Twombly case law for the proposition that “a ‘plaintiff’s
obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels
and conclusions, and a formulaic recitation of the elements of a cause of action will not do.’”
Id. (alteration in original) (quoting Twombly, 550 U.S. at 555; citing Papasan v. Allain, 478
U.S. 265, 286 (1986)). The court applied the two-prong approach suggested in Iqbal, and
concluded that while some allegations were conclusory, the allegations that the defendant
knew the faxes were advertisements, participated in the preparation of the faxes, provided
or obtained the fax numbers of the plaintiff and other class members, paid a third party for
transmission, and/or knew that the faxes were not authorized, were factual and entitled to a
presumption of truth. Id. at *2. The court explained that “unlike in Ashcroft, the factual
allegations d[id] not describe parallel conduct; rather they describe[d] a clear violation of the
TCPA.” Id. The court also noted that “[o]n a motion to dismiss, we are required to assume
that all general allegations embrace whatever specific facts might be necessary to support
them,” and concluded that the plaintiff was not required to detail how the fax constituted an
advertisement. Id. at *3. With respect to the civil conspiracy claim and the aiding and
abetting claim, the court found that the facts alleged, taken as true, supported both of those
claims and were incompatible with any lawful behavior. Consumer Prot. Corp., 2009 WL
2132694, at *4. The motion to dismiss was denied.
•

Padilla v. Yoo, 633 F. Supp. 2d 1005 (N.D. Cal. 2009). The plaintiff’s claims arose out of
his designation as an “enemy combatant” and his resulting detention. See id. at 1012. The
plaintiff alleged that the defendant, the Deputy Attorney General in the Office of Legal
Counsel for President George W. Bush, was responsible for the harsh treatment plaintiff
received as an enemy combatant, which allegedly resulted from policies implemented under
the defendant’s counsel. See id. at 1014–15. Among the violations of rights that the plaintiff
alleged were: denial of access to counsel, denial of access to court, unconstitutional
conditions of confinement, unconstitutional interrogations, denial of freedom of religion,
denial of the right to information, denial of the right to association, unconstitutional military
detention, denial of the right to be free from unreasonable seizures, and denial of due
process. See id. at 1016–17. The court concluded that the plaintiff had stated a sufficient
Bivens claim. Id. at 1030. In considering qualified immunity, the court found that the
allegations contained “sufficient facts to satisfy the requirement that Yoo set in motion a
series of events that resulted in the deprivation of Padilla’s constitutional rights.” Id. at
1034. The court distinguished Iqbal, explaining that “[h]ere, in contrast, Padilla allege[d]
with specificity that Yoo was involved in the decision to detain him and created a legal
construct designed to justify the use of interrogation methods that Padilla allege[d] were
unlawful.” Padilla, 633 F. Supp. 2d at 1034 (footnote omitted). With respect to the
allegations of constitutional violations, the court concluded that “[t]he allegation that Padilla
was denied any access to counsel for nearly two years [wa]s sufficient to state a claim for
violation of his access to courts”; that Padilla had stated a claim for violation of the Eighth
Amendment (although the claim had to be analyzed under the Due Process Clause of the
180

Fourteenth Amendment); and that “[b]ecause there [wa]s no allegation in the complaint . .
. that Padilla was ever made to be a witness against himself or that his statements were
admitted as testimony against him in his criminal case, he ha[d] not stated a claim for
violation of the Self-Incrimination Clause of the Fifth Amendment.” Id. at 1035–36. The
court concluded that qualified immunity did not apply because the violations alleged
involved clearly established constitutional rights, and a reasonable federal officer could not
have believed the conduct was lawful. Id. at 1038.

District Court Case Law in the Tenth Circuit
•
Masters v. Gilmore, --- F. Supp. 2d ----, No. 08-cv-02278-LTB-KLM, 2009 WL 3245891
(D. Colo. Oct. 5, 2009). The claims arose out of the plaintiff’s conviction in a case involving
the murder of Peggy Hettrick. Masters, who was fifteen at the time of the murder, was
arrested more than eleven years after the murder, and was convicted and sentenced to life
in prison. Id. at *2. Nearly a decade later, Masters’s conviction was vacated based on postconviction motions, and the charges against him were dismissed. Id. In his complaint,
Masters asserted claims against VanMeveren (the district attorney for the Eighth Judicial
District during the time of the murder and Masters’s conviction), Abrahamson
(VanMeveren’s successor), Gilmore (a deputy district attorney who assisted in the
investigation of the murder and was lead counsel in the prosecution and trial of Masters), and
Blair (a deputy district attorney who worked on the murder case and was second chair in the
prosecution and trial of Masters). Id. The complaint contained numerous allegations against
the defendants, including, among other allegations, that Gilmore and/or Blair engaged in
misconduct such as targeting only Masters as a suspect; withholding the results of a 1988
surveillance of Masters that contradicted the theory that Masters was guilty; failing to
investigate several other potential suspects; failing to recuse themselves from the case
despite the fact that Gilmore and Blair had connections to one of the other potential suspects;
authorizing the release and destruction of evidence relating to other potential suspects;
manufacturing expert opinions by disclosing only selected evidence and withholding
exculpatory evidence; and ignoring, hiding, withholding and/or destroying the opinions
proffered by other experts as well as other potentially exculpatory evidence. See id. at *2–6.
The complaint alleged that VanMeveren was regularly and thoroughly briefed on the
investigation and prosecution of Masters, consulted closely with Gilmore and Blair
throughout the investigation and prosecution, was informed of the results of the 1988
surveillance and the conflict of interest that Gilmore and Blair had with another potential
suspect, agreed not to investigate one of the other potential suspects, allowed the destruction
of evidence, failed to recuse the district from the case, and failed to take action to address
doubts as to Masters’s guilt raised by a police detective. See id. at *6. The complaint also
alleged that VanMeveren failed to adequately train and supervise his subordinates and had
customs, policies, and/or actual practices that allowed the alleged misconduct. See id. at *7.
With respect to Abrahamson, the complaint alleged that he was responsible for managing
the district’s personnel, that he was responsible for assigning deputy district attorneys to the
post-conviction investigation, and that his customs, policies, and/or actual practices allowed
the alleged misconduct. Masters, 2009 WL 3245891, at *7. The complaint made similar
181

allegations against the Eighth Judicial District. Id. at *8.
Masters asserted claims under § 1983 for malicious prosecution, destruction and/or hiding
of exculpatory evidence, manufacture of inculpatory evidence, unreasonable seizure/arrest
without probable cause, false imprisonment, fundamental unfairness of his criminal trial in
violation of his rights under the Fourth and Fourteenth Amendments, and conspiracy to
violate his civil rights. Id. The defendants moved to dismiss, largely relying on absolute
prosecutorial immunity, qualified immunity, and Eleventh Amendment immunity. Id.
With respect to Gilmore, the court concluded that he was entitled to absolute prosecutorial
immunity as to his involvement in the preparation and filing of the affidavit supporting the
1998 arrest warrant, his alleged failure to conduct an investigation of the murder separate
from the police department, and conduct following Masters’s arrest and at trial, but
concluded that the allegation that Gilmore destroyed exculpatory evidence was not covered
by prosecutorial immunity, regardless of when it occurred. Id. at *10, *18. The court also
concluded that Gilmore was not entitled to qualified immunity. Id. at *16. The false arrest
and false imprisonment claims failed because Masters was arrested pursuant to a warrant.
Masters, 2009 WL 3245891, at *16. The court declined to dismiss the claim against Gilmore
based on the fundamental unfairness of Masters’s trial in violation of his substantive due
process rights, concluding that the allegations, taken as true, shocked the court’s conscience.
Id. at *17. The court also declined to dismiss the claims alleging destruction and/or hiding
of exculpatory evidence, manufacture of inculpatory evidence, and unfairness of the criminal
trial, on the argument that they were duplicative of the malicious prosecution claim, finding
it inappropriate “to dismiss them solely to streamline the litigation at this early stage in the
proceedings.” Id.
With respect to Blair, the court found her to be absolutely immune for her involvement in
the preparation and filing of the affidavit supporting the 1998 arrest warrant, her failure to
conduct an independent investigation of the murder, and her conduct following the arrest,
except the destruction of evidence. Id. at *22. The complaint contained other allegations
regarding Blair’s misconduct occurring before the affidavit supporting the arrest or involving
destruction of evidence, and the court rejected Blair’s argument that those allegations had
to be dismissed as insufficiently specific. Id. at *18. The court explained:
Mr. Masters has alleged that Ms. Blair worked with other Defendants
to manufacture probable cause that Mr. Masters committed the
Hettrick murder before a decision to charge him for the crime was
made. Mr. Masters has further alleged specific acts and omissions by
Ms. Blair that would serve this objective including her alleged hiding,
ignoring and/or destruction of exculpatory evidence. Although Mr.
Masters’ Amended Complaint does not set forth specific dates on
which Ms. Blair performed specific acts, the pleading standards
under FED R. CIV. P. 8 as recently refined by Twombl[]y, supra, and
Ashcroft, supra, do not require this level of specificity. See
182

Twombl[]y, 550 U.S. at 555 (plaintiff need not provide “detailed
factual allegations” to survive motion to dismiss).
Id. (emphasis added). The court permitted the malicious prosecution claim against Blair to
proceed based on her alleged knowing fabrication of probable cause and incriminating expert
opinions. Masters, 2009 WL 3245891, at *20. The claim based on destruction and/or hiding
of an exculpatory expert report could proceed despite Blair’s argument that the expert
opinions were obtained before she was involved in the murder case because “the time when
Dr. Tsoi provided his opinions regarding the case and when the evidence of these opinions
was allegedly destroyed [we]re not specified in the Amended Complaint, and it [wa]s
plausible that the alleged destruction occurred sometime after April of 1998 [when Blair
began work on the case].” Id. Prosecutorial immunity did not apply to the § 1983 claim for
relief based on the alleged manufacture of inculpatory evidence because the complaint
alleged “that there was no probable cause to arrest [the plaintiff] at the time [the expert]
began working on the Hettrick murder case sometime before December of 1997 and for
some period of time thereafter,” and “[d]uring this period of time, it c[ould not] be said that
[the expert’s] work on the case was done in preparation for trial such that the immunity
typically afforded prosecutors in dealing with trial witnesses [wa]s applicable.” Id. The
court found that the claims for false arrest and false imprisonment failed because Blair was
entitled to absolute immunity and because Masters was arrested pursuant to a warrant. See
id. at *21. The court also concluded that Blair was not entitled to prosecutorial immunity
with respect to the claims regarding fundamental unfairness of the criminal trial and
conspiracy. Id. at *22.
With respect to VanMeveren, the court rejected his argument that the claims against him
were insufficient under Twombly and Iqbal. The court explained:
Mr. Masters alleges that Mr. VanMeveren (1) was regularly
and thoroughly briefed by and consulted closely with Defendants
Gilmore and Blair throughout the investigation and prosecution of
Mr. Masters; (2) was specifically aware of the results of the 1988
surveillance and the conflict of interest that Defendants Gilmore and
Blair had with any investigation of [another potential suspect]; (3)
allowed Mr. Gilmore to participate in [this other suspect’s]
investigation and to offer [the other potential suspect’s wife]
immunity; and (4) upon information and belief, agreed not to
investigate [this other potential suspect] as a suspect, allowed for the
destruction of evidence in the case, and failed to recuse the Eighth
Judicial District from the Hettrick murder case.
Mr. VanMeveren argues that Ashcroft dictates that a plaintiff
seeking to impose supervisory liability on a § 1983 defendant must
allege more than that the particular defendant “knew of, condoned,
and willfully and maliciously agreed to” violate a plaintiff’s
183

constitutional rights. Although such allegations were held to be
insufficient in Ashcroft, the plaintiffs’ claims there are
distinguishable from those of Mr. Masters. Specifically, the plaintiff
in Ashcroft brought a Bivens action for discrimination in violation of
the First and Fifteenth Amendments. Such claims require a plaintiff
to plead and prove that the defendant acted with discriminatory
purpose. Ashcroft, 129 S.Ct. 1948. As a result of this particular
requirement, the Supreme Court concluded that mere knowledge on
the part of the supervisor was an insufficient basis for Bivens
liability, which it treated as equivalent to § 1983 liability. The
Supreme Court prefaced its analysis of this issue by recognizing that
“[t]he factors necessary to establish a Bivens [or § 1983] violation
will vary with the constitutional provision at issue.”
Ashcroft thus does not support the general proposition that
allegations of knowledge, acquiescence, and agreement on the part
of a supervisory defendant are never sufficient to support a § 1983
claim. In any event, Mr. Masters’ Amended Complaint goes further
and alleges that Mr. VanMeveren “consulted closely” and plausibly
participated with Defendants Gilmore and Blair throughout the
investigation and prosecution of Mr. Masters.
Id. at *23 (emphasis added) (fourth and fifth alterations in original) (internal citations
omitted). The court held that “[i]n view of Mr. VanMeveren’s substantial personal
participation with the investigation and prosecution of Mr. Masters as alleged in the
Amended Complaint, . . . Mr. Masters ha[d] adequately pled the required elements of
supervisory liability under § 1983,” and had provided “fair notice of the nature of Mr.
Masters’ claims against [VanMeveren].” Masters, 2009 WL 3245891, at *24. The court
concluded that VanMeveren was absolutely immune for involvement in the preparation and
filing of the affidavit supporting the 1998 arrest warrant, alleged failure to conduct an
investigation of the Hettrick murder independent of the police department, and conduct
following Masters’s arrest and at trial, except any involvement in the destruction of
evidence. Id. at *25. The court also dismissed the claims predicated on VanMeveren’s role
as a supervisor responsible for training and/or creating the policies, practices, and customs
of the district, after the plaintiff conceded that they could not proceed, and dismissed the
false imprisonment and false arrest claims because they were predicated on conduct done
pursuant to a warrant and for which VanMeveren was absolutely immune. See id.
Finally, with respect to the claims against Abrahamson and the Eighth Judicial District, the
court dismissed the false arrest and false imprisonment claims for failure to state a claim
based on the existence of a warrant, but found that Eleventh Amendment immunity did not
apply, and, because these claims were not for individual liability under § 1983, “none of the
limitations recognized on the remaining claims against the other DA Defendants [we]re
applicable to these Defendants.” Id. at *27.
184

•

Bell v. Turner Recreation Comm’n, No. 09-2097-JWL, 2009 WL 2914057 (D. Kan. Sept.
8, 2009). In a Title VII case alleging unlawful discrimination and retaliation, the court
rejected the defendants’ argument that the complaint failed to allege enough facts under
Iqbal.22 The court noted that:
With respect to her discrimination claim, plaintiff alleges that her
supervisor, Becca Todd, routinely treated plaintiff less favorably than
she treated similarly situated white employees by assigning plaintiff
less desirable tasks; reducing plaintiff’s hours while increasing the
hours of white employees; subjecting plaintiff to heightened scrutiny
in her job performance; and requiring plaintiff to adhere strictly to
her work schedule while permitting white employees to arrive late
and take extended breaks. She further alleges that her supervisor
refused to socialize with plaintiff but routinely socialized with white
employees and that her supervisor excluded plaintiff from certain
activities that were made available to white employees. Finally, she
contends that she received two written reprimands on February 7,
2009 on the basis of her race and that she was suspended and
ultimately terminated on the basis of her race.
Id. at *3. The court found that these allegations were “more than sufficient to satisfy the
pleading standards set forth in Twombly and Iqbal.” Id. With respect to the retaliation
claim, the court noted that the plaintiff alleged that she complained to her supervisor that she
was being treated less favorably than the white lifeguards; that she complained in writing to
her supervisor’s supervisor that she was subject to racial discrimination; that one hour and
fifteen minutes after the latter complaint, she was suspended; and that she was terminated
upon returning to work after suspension. Id. The court concluded that “Plaintiff, then, ha[d]
clearly alleged specific facts showing that she was treated less favorably than similarly

22

The Northern District of Oklahoma has also confirmed that Twombly and Iqbal apply to employment discrimination
cases. See Coleman v. Tulsa County Bd. of County Comm’rs, No. 08-CV-0081-CVE-FHM, 2009 WL 2513520, at *3
(N.D. Okla. Aug. 11, 2009). In Coleman, the court cited pre-Twombly case law for the propositions that conclusory
allegations need not be accepted as true and that factual averments are necessary to adequately state a claim. See id. at
*2 (citing Erikson v. Pawnee County Bd. of County Comm’rs, 263 F.3d 1151, 1154–55 (10th Cir. 2001); Hall v. Bellmon,
935 F.2d 1106, 1109–10 (10th Cir. 1991)). In considering the plaintiff’s claims of retaliation and hostile work
environment, the court noted that the complaint did “not reference a single date on which any event occurred, nor [did]
it identify which of defendant’s employees harassed her or describe any of the harassing statements,” and that although
the plaintiff alleged that the defendant took “‘unreasonabl[e] disciplinary action’ against her and subjected her to adverse
employment action,” she did not explain the disciplinary action. Id. at *3. The court stated that “[w]hile plaintiff is
correct that Twombly does not impose a demanding pleading standard, she must still state a claim that is plausible on
its face and allege enough facts to support a claim that defendant has unlawfully discriminated against her.” Id. The
court noted that the plaintiff did not provide “any factual allegations describing the alleged hostile work environment
and, for her retaliation claims, she d[id] not even state how defendant allegedly retaliated against her.” Id. The court
found that “while Twombly is not a demanding standard, it does require plaintiff to allege some facts in support of her
claims.” Id. (emphasis added). The court noted that the complaint might have survived under Conley, but that “[t]he
allegations . . . [w]ere so general that it [wa]s not possible for the Court to determine if plaintiff ha[d] stated a claim.”
Coleman, 2009 WL 2513520, at *3. The court granted leave to amend. Id.

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situated white employees and that she suffered an adverse action and, with respect to her
retaliation claim, that she complained to her employer about racial discrimination in the
work place and that she suffered an adverse employment action as a result of that
complaint.” Id. The court explained that “[n]othing more is required under the law” and
that “it is difficult to imagine what more the court could require of plaintiff in terms of
pleading her claims with specificity.” Id. (emphasis added).
•

Clark v. Nweke, No. 04-cv-02414-LTB-KMT, 2009 WL 3011117 (D. Colo. Sept. 16, 2009).
The plaintiff alleged violations of the Eighth Amendment in connection with medical
treatment he received in state prison. The plaintiff alleged that a prison doctor failed to
provide necessary surgery in a timely manner, but the court concluded that the claim could
not proceed because the plaintiff “failed to allege any facts showing that he had a need for
‘immediate surgery’ that was ‘so obvious that even a lay person would easily recognize’ it,”
id. at *4 (quoting Sealock v. Colorado, 218 F.3d 1205, 1209 (10th Cir. 2000)), and had
therefore “failed to sufficiently allege that he had an objectively serious medical need for
‘immediate surgery’ . . . ,” id. The court also concluded that the plaintiff failed make any
allegations that the doctor “had ‘sufficiently culpable state of mind.’” Id. (quoting Farmer
v. Brennan, 511 U.S. 825, 833 (1970)).23

District Court Case Law in the Eleventh Circuit
•
NCI Group, Inc. v. Cannon Servs., Inc., No. 1:09-CV-04410-BBM, 2009 WL 2411145
(N.D. Ga. Aug. 4, 2009). The plaintiff, a business that manufactures metal buildings, metal
components, and metal coil coatings, alleged that the defendants operated several schemes
to defraud the plaintiff and its clients. Id. at *1. The complaint detailed the alleged schemes,
which included kickbacks paid to the plaintiffs’ employees. See id. at *2. The complaint
asserted claims for fraud, conversion, breach of fiduciary duty, aiding and abetting breach
of fiduciary duty, tortious interference with contractual or business relations, negligence,
violations of the Federal Civil Racketeer Influenced and Corrupt Organizations Act, and
violations of the Georgia Racketeer Influenced and Corrupt Organizations Act. Id. at *3.
Among other arguments, one group of defendants (the “Goldin Defendants”) argued that the
complaint failed to properly assert the federal RICO claims because it “failed to adequately
allege the existence of (1) an enterprise; (2) a pattern of racketeering activity; (3) predicate
acts; (4) relatedness; (5) continuity; and (6) relationship.” Id. at *7. The court rejected that
argument:
The court finds that NCI has sufficiently pled claims against
23

See also Johnson v. Liberty Mutual Fire Ins. Co., --- F. Supp. 2d ----, No. 08-cv-01137-MSK-MJW, 2009 WL
2868841, at *9–10 (D. Colo. Sept. 2, 2009) (In considering a complaint alleging that the plaintiffs’ insurance company
acted in bad faith in destroying evidence that the plaintiffs needed in a later lawsuit against a driver who hit one of the
plaintiffs, the court noted that “[t]he only clear allegation by the Plaintiffs of Liberty’s state of mind [wa]s the allegation
that Liberty ‘knew, or should have known, of [the] evidentiary significance of the Johnsons’ claims’ of the taillights,”
and concluded that, as explained in Twombly and Iqbal, this “entirely conclusory” allegation was not sufficient under
Rule 12(b)(6).) (third alteration in original).

186

the Goldin Defendants for violations of federal RICO, 18 U.S.C. §
1962(b)–(d) so as to survive the Motion to Dismiss. NCI has alleged
facts supporting the existence of an enterprise—asserting that “the
Defendants were operating several related schemes to defraud NCI
and the Clients,” and describing with particularity the overlapping
participation of individuals in the schemes, as well as specific acts
undertaken by Defendants “as part of the NCI-Targeted Scheme.”
The underlying acts alleged, inter alia, violations of 18 U.S.C. §§
1957 [(which prohibits “‘[e]ngaging in monetary transactions in
property derived from specified unlawful activity’”)] and 2320
[(which prohibits “‘[t]rafficking in counterfeit goods or services’”)],
. . . constitute racketeering activity pursuant to 18 U.S.C. §
1961(1)(B). Likewise, NCI has asserted and described that the
pattern of racketeering the Goldin Defendants engaged in constituted
two or more acts within the last ten years, as required by the statute.
The continuity element is satisfied, as NCI has alleged that the
NCI-Targeted Scheme “operated continually from approximately
1995 until 2006.” Consequently, in its Amended Complaint, NCI
sets forth ample factual allegations, accepted as true for the purposes
of this Motion, which are sufficient to state a claim for violations of
18 U.S.C. § 1962(b)–(d). See M.T.V.[ v. DeKalb County Sch. Dist.],
446 F.3d [1153,] 1156 [(11th Cir. 2006)]; Iqbal, 129 S. Ct. at 1949.
As a result, NCI’s Amended Complaint gives the Goldin Defendants
“fair notice of what the . . . claim[s] [are] and the grounds upon which
[they] rest [ ].” Twombly, 550 U.S. at 555. Therefore, the court
denies the Goldin Defendants’ Motion to Dismiss the federal RICO
claims found in Count 8 of NCI’s Amended Complaint.
Id. at *10 (second, fourth, eighth, ninth, tenth, and eleventh alterations in original) (footnotes
and additional internal citations omitted). The court noted:
In arguing for dismissal of NCI’s claims, the Goldin Defendants
repeatedly seek to hold NCI to a standard that is unrealistic given the
current posture of the case. At the Motion to Dismiss stage,
discovery has not yet been conducted. “[T]he pleading standard Rule
8 announces does not require detailed factual allegations, but it
demands more than an unadorned, the-defendant-unlawfullyharmed-me accusation.” Iqbal, 129 S. Ct. at 1949 (citation and
internal quotations omitted). “To survive a motion to dismiss, a
complaint must contain sufficient factual matter . . . to state a claim
to relief that is plausible on its face . . . [or] plead [ ] factual content
that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Id. (citations and
internal quotations omitted).
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NCI Group, 2009 WL 2411145, at *10 n.7 (first emphasis added) (alterations and omission
in original).
The court also rejected the defendants’ request for dismissal of the fraud claim, finding the
allegations in the complaint sufficient:
NCI alleges that the Defendants conspired and engaged in
conduct constituting fraud, including but not limited to: (1) falsifying
and manipulating MCG’s and MCM’s computer records; (2)
developing, implementing, participating in, and profiting from the
NCI-Targeted Scheme; (3) concealing the NCI-Targeted Scheme
from NCI; (4) incorrectly designating or labeling coil as secondary
or scrap; and (5) concealing evidence of kickbacks, bribes or other
related benefits. It incorporates the allegations made previously in
the Amended Complaint that describe in detail the Goldin Secondary
Scheme. NCI alleges that the fraud occurred through false
representations stemming from both affirmative acts and omissions,
known to be false, and intentionally made to induce NCI to act or
refrain from acting. NCI further states that as a result, it justifiably
relied on these acts and omissions, and suffered damages in the
course of this reliance. Taking its allegations to be true, NCI’s
Amended Complaint contains enough factual allegations to state a
claim for fraud. In other words, NCI has “alleged enough facts to
suggest, raise a reasonable expectation of, and render plausible,” its
fraud claim against the Goldin Defendants. Watts[ v. Fla. Int’l
Univ.], 495 F.3d [1289,] 1296 [(11th Cir. 2007)].
Id. at *11.
The court found the allegations supporting the Georgia RICO claim sufficient as well:
NCI has sufficiently stated a claim for violations of Georgia
RICO § 16-14-4(a)–(c) against the Goldin Defendants. NCI alleges
that the Goldin Defendants engaged in at least two acts of
racketeering activity, in furtherance of one or more incidents,
schemes, or transactions that have the same or similar intents, results,
accomplices, victims, or methods of commission. O.C.G.A. §
16-14-3(8)(A). O.C.G.A. § 16-14-3(9)(A)(xxix) specifies that
racketeering activity consists of “[a]ny conduct defined as
‘racketeering activity’ under 18 U.S.C. Section 1961(1)(A), (B), (C),
and (D),” and the court has already found that NCI has properly
alleged facts supporting the Goldin Defendants’ violations of 18
U.S.C. § 1957 and 18 U.S.C. § 2320, which constitute racketeering
activity under federal RICO. Therefore, NCI’s allegations as to
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predicate acts pursuant to Georgia RICO are sufficient. NCI’s factual
allegations that the Goldin Defendants violated O.C.G.A. §
16-14-4(a)–(c) are sufficient to state a well-pleaded claim.
Id. at *13 (alteration in original) (footnotes omitted).
The conversion claim was held to be sufficient as well:
NCI alleges that as part of the NCI-Targeted Scheme,
Defendants removed and sold steel coils, without authorization, that
they knew NCI or its clients owned or possessed. NCI further asserts
that in turn, Defendants benefitted from the unauthorized removal of
steel coils. It states that as part of this scheme, the Defendants
exercised the right of ownership over and took possession of NCI’s
property, and/or exhibited acts of dominion over NCI’s property or
hostility toward NCI’s property rights. As previously noted, NCI
describes in detail the roles of each of the Goldin Defendants in the
Goldin Secondary Scheme, and the specifics of this scheme. Taken
as true for the purposes of this Motion, NCI has asserted facts that
sufficiently alleged a claim for conversion against the Goldin
Defendants.
Id. at *14 (internal citation omitted).
The claim for aiding and abetting breach of fiduciary duty was also adequately pleaded:
In its Amended Complaint, NCI alleges that through improper action
or wrongful conduct that was unauthorized, the Goldins acted to
procure a breach of certain NCI employees. In its description of the
Goldin Secondary Scheme, NCI makes clear that the Goldin
Defendants made arrangements and agreements with Mr. Carroll that
resulted in a breach of his fiduciary duties—namely directing
employees to perform work on the Goldin Coils, incorrectly charging
the Goldin Defendants, placing a fake Master Coaters’ trademark on
the coils, and receiving kickbacks for his actions. NCI further alleges
that the Goldin Defendants knew that the NCI employees, in
particular Mr. Carroll, owed NCI a fiduciary duty “by virtue of [his]
employment” acting purposely and with malice and intent to injure
NCI. Finally, NCI alleges that the Goldin Defendants’ “wrongful
conduct proximately caused damages to NCI.”
In alleging a claim for aiding and abetting breach of fiduciary
duty, NCI has satisfied its burden of alleging “enough facts to
suggest, raise a reasonable expectation of, and render plausible” its
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claim. Watts, 495 F.3d at 1296. The allegations, if true, state a claim
for violation of Georgia’s law prohibiting aiding and abetting breach
of fiduciary duty.
Id. at *14–15 (alteration in original) (internal citation and footnote omitted).
The court also found that the allegations supporting the claim for tortious interference with
contractual or business relations were sufficient:
In its Amended Complaint, NCI has alleged a number of facts
supporting its assertion of improper and wrongful conduct on the part
of the Goldin Defendants due to their participation in the Goldin
Secondary Scheme. NCI says that the Goldin Defendants
“intentionally and maliciously carried out” the schemes to cause NCI
damages. NCI alleges further that in so doing, the Goldins induced
NCI employees to breach their contractual obligations with NCI. As
has been described previously, NCI alleged that the Goldin
Secondary Scheme involved the Goldin Defendants and Mr. Carroll,
an employee of NCI. NCI explains that the contractual obligation to
which it refers is Mr. Carroll’s employment agreement with NCI, and
the court similarly finds this to be sufficiently clear from the
allegations in the Amended Complaint. NCI also alleges that the
Goldin Defendants caused NCI’s customers to discontinue or fail to
enter into anticipated business relationships with NCI by virtue of the
NCI-Targeted Scheme. Finally, NCI states that the Goldin
Defendants’ tortious conduct was the proximate cause of damage to
it.
NCI has adequately alleged facts which are sufficient to state
a claim for tortious interference with business or contractual relations
under Georgia law . . . .
Id. at *15 (internal citations and footnotes omitted). The court noted that the plaintiff had
“not alleged any actual facts to support” its claim that the Goldin Defendants caused the
plaintiff’s customers to discontinue or fail to enter into anticipated business relationships
with the plaintiff as a result of one of the alleged schemes, NCI Group, 2009 WL 2411145,
at *15 n.14 (citing Twombly, 550 U.S. at 555), but concluded that “because NCI ha[d]
alleged facts sufficient to support its claim that the Goldin Defendants induced a breach of
Mr. Carroll’s contractual obligations with NCI, this failure [wa]s not fatal to the claim.” Id.
Finally, the court found the allegations supporting the negligence claim sufficient. The
plaintiff had incorporated previous factual allegations, and “allege[d] that the Goldin
Defendants ‘owed NCI a duty of good faith and fair dealing’ as well as ‘a duty of ordinary
care’”; “assert[ed] that the Goldin Defendants breached these duties to NCI ‘by participating
190

in and profiting from the NCI-Targeted Scheme’”; and “allege[d] that as a result it ha[d]
suffered damages.” Id. at *16. The court noted that while “the duty of good faith and fair
dealing is an implied duty imposed upon parties to a contract, applicable to the contract’s
‘performance and enforcement,’” NCI had “neither mentioned nor alleged the existence of
a contract between itself and the Goldin Defendants.” Id. (citation omitted). As a result, the
court concluded that “NCI ha[d] not alleged facts which, if accepted as true, [could] support
the idea that the Goldin Defendants owed NCI a duty of good faith and fair dealing.” Id.
But the court rejected the defendants’ argument that the “negligence claim fail[ed] because
‘the complaint charge[d] the Goldins only with intentional misconduct, not negligent
misconduct.’” Id. (citation omitted). The court explained that the allegations were
sufficient:
[T]he Goldin Defendants have not provided, and the court is not
aware of, any authority requiring NCI to specifically allege that the
conduct was “negligent” in so many words. As set out above, a claim
for negligence requires only the elements of duty, breach, causation,
and injury. NCI has asserted factual allegations sufficient to support
each of these elements, describing in detail the Goldin Defendants’
alleged misconduct. Furthermore, the Federal Rules provide for
alternative pleading, and parties routinely allege both fraud and
negligence claims in their complaints. See, e.g., FED. R. CIV. P.
8(d)(2) (“A party may set out 2 or more statements of a claim or
defense alternatively or hypothetically, either in a single count or
defense or in separate ones. If a party makes alternative statements,
the pleading is sufficient if any one of them is sufficient.”); Reynolds
v. Fla. Highway Prods., Inc., No. CV507-78, 2008 WL 5430332, at
*1 (S.D. Ga. Dec. 31, 2008) (asserting claims for negligence and
fraud, both of which survived summary judgment). The court
therefore finds that NCI has sufficiently stated a claim for negligence
against the Goldin Defendants, and denies their Motion to Dismiss
this claim.
NCI Group, 2009 WL 2411145, at *16 (internal citations omitted).
The court dismissed the counterclaims for attorneys’ fees and costs. The court explained that
to the extent the claim was predicated on one provision of state statutory law, it could not
proceed because the statute was “‘unavailable to civil litigants in federal court.’” Id. at *17
(quoting Bruce v. Wal-Mart Stores, Inc., 699 F. Supp. 905, 906 (N.D. Ga. 1988)). To the
extent the claim was predicated on a state statute providing liability for abusive litigation,
the claim was premature because the statute required termination of the proceeding in which
the alleged abusive litigation occurred. Id. at *18 (citations omitted). The court also found
that the defendants “ha[d] not provided, and the court [was] not otherwise aware of, any
basis in ‘federal law’ through which [the defendants] would be entitled to state counterclaims
solely for attorneys’ fees and costs due to NCI’s allegedly frivolous claims against them.”
191

Id. (footnote omitted).
The court then considered the request of one of the defendants for a more definite statement
of cross-claims for contribution and indemnification. The court cited a pre-Twombly case
for the proposition that a complaint must contain enough detail to provide notice of the
claim:
“While the requirements of pleading under the Federal Rules
are ‘liberal,’ and a litigant need not allege a specific fact to cover
every element or allege with precision each element of a claim . . . a
pleader must at least provide his opponent with ‘fair notice of what
[his] claim is and the grounds upon which it rests.’”
Id. at *19 (emphasis added) (omission and alteration in original) (quoting Parker v. Brush
Wellman, Inc., 377 F. Supp. 2d 1290, 1294 (N.D. Ga. 2005) (quoting Conley, 355 U.S. at
47)). The court cited the same pre-Twombly case to emphasize that “‘a plaintiff should
include in his pleading some brief factual description of the circumstances surrounding the
acts or omissions upon which he bases his claim for relief.’” Id. (quoting Parker, 377 F.
Supp. 2d at 1294). The court granted the motion for a more definite statement, finding that
the cross-claimants “failed to identify ‘the grounds upon which [their claims] rest[ ],’” NCI
Group, 2009 WL 2411145, at *19 (alterations in original) (quoting Parker, 377 F. Supp. 2d
at 1294), and explaining that “[f]or example, the cross-claims d[id] not specify whether Ms.
Coker and Mr. Coots [sought] contribution under state or federal law,” and “the cross-claims
[did not] specify the nature of any duty owed by Mr. Byers to Ms. Coker and Mr. Coots
which might be the basis for a contribution claim.” Id.
•

Ansley v. Florida, Dep’t of Revenue, No. 4:09cv161-RH/WCS, 2009 WL 1973548 (N.D.
Fla. Jul. 8, 2009). The plaintiff’s employment discrimination claims failed to allege
sufficient facts. The court noted that Swierkiewicz does not require “a complaint [to] allege
with precision all the elements of a cause of action,” id. at *1 (citing Swierkiewicz, 534 U.S.
at 514–15), but explained that the complaint was insufficient:
The plaintiff asserts claims of gender discrimination in
violation of Title VII of the Civil Rights Act of 1964 as amended and
disability discrimination in violation of the Florida Civil Rights Act.
But the plaintiff does not say what the alleged reason—the pretextual
reason—for the firing was. He does not even allege the reason was
false; a reason can be true but still pretextual if it was not the real
reason for the decision. He does not allege a factual basis for the
conclusion that the others who were treated better were similarly
situated. He does not allege his medical condition and thus does not
allege a factual basis for his claim that it—or the defendant’s
perception of it—entitled him to protection under the Florida Civil
Rights Act. He does not allege a claim under the Family and Medical
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Leave Act and does not explain how his father’s illness—also
unexplained—entitled the plaintiff to protection under the Florida
Civil Rights Act.
Id. at *2. The court noted that “[t]hese allegations might have survived a motion to dismiss
prior to Twombly and Iqbal,” but held that “now they do not.” Id. (emphasis added). The
court stated that an employment-discrimination plaintiff “must allege facts that are either (1)
sufficient to support a plausible inference of discrimination, or (2) sufficient to show, or at
least support an inference, that he can make out a prima facie case under the familiar burdenshifting framework set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S. Ct.
1817, 36 L. Ed. 2d 668 (1973), and its progeny.” Id. The court concluded that “[t]he
plaintiff ha[d] not done so,” but granted leave to amend. Id.

193