Twombly and Communication: The Emerging Definition of Concerted Action Under the New Pleading Standards

28 Pages Posted: 20 Oct 2008 Last revised: 25 Mar 2009

William H. Page

University of Florida - Levin College of Law

Multiple version iconThere are 2 versions of this paper

Date Written: March 23, 2009

Abstract

After the Supreme Court's 2007 decision in Bell Atlantic Corp. v. Twombly, an antitrust plaintiff who tries to plead an agreement in restraint of trade under Section 1 of the Sherman Act must allege more than parallel conduct and an undefined "conspiracy." Now, the complaint must include "enough factual matter (taken as true) to suggest that an agreement was made." Although the Court insisted it was not imposing a heightened pleading standard, it did require antitrust plaintiffs to provide enough detail to make the claimed agreement plausible. In this article, I examine an important substantive consequence of Twombly's pleading regime. In nineteen reported cases, federal courts have applied the new pleading standard to complaints alleging concerted action under Section 1 of the Sherman Act. In doing so, the courts have had to address a crucial defect in the substantive law of agreement: the Supreme Court's traditional definitions of agreement, which Twombly itself simply repeated, are too vague to help litigants and courts distinguish between consciously parallel conduct and concerted action. In the course of applying Twombly, however, the lower courts have adopted a more meaningful definition, one that requires that the parties have communicated to each other their intentions to act in a certain way, and their reliance on each other to do the same. This clarification of the standard has important implications for the role of discovery in pleading and resolving claims of concerted action.

Keywords: antitrust, collusion, conscious parallelism, facilitating practices, concerted action, Sherman Act, pleading, Twombly

JEL Classification: D43, K21, K41, L13, L40

Suggested Citation

Page, William H., Twombly and Communication: The Emerging Definition of Concerted Action Under the New Pleading Standards (March 23, 2009). Journal of Competition Law and Economics, 2009; University of Florida Levin College of Law Research Paper No. 2008-01. Available at SSRN: https://ssrn.com/abstract=1286872

William Hepburn Page (Contact Author)

University of Florida - Levin College of Law ( email )

P.O. Box 117625
Gainesville, FL 32611-7625
United States

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