The Iqbal Effect: The Impact of New Pleadings Standards in Employment and Housing Discrimination Litigation
Raymond H. Brescia
Albany Law School
October 9, 2011
Kentucky Law Journal, Vol. 100, pp. 235-288, 2011-2012
In May 2009, the Supreme Court issued its decision in Ashcroft v. Iqbal, a case brought by an immigrant of Pakistani descent caught up in the worldwide investigation that followed the horrific attacks of September 11, 2001. In that decision, the Court extended the “plausibility test” first introduced two years earlier, in Bell Atlantic v. Twombly, to all civil pleadings in federal court. That test requires that, in order to satisfy federal pleading requirements, a complaint must allege a plausible set of facts.
Many have expressed fears that the standard set forth in these two decisions would have an adverse impact on civil litigants in federal court, imposing a heightened pleading standard on cases across the board, and civil rights cases in particular. It is in this narrower group of cases where fears were strongest: that judges that might already harbor hostility to these types of cases would utilize the plausibility standard to dismiss cases more readily, closing an already narrowed court house door to litigants pursuing such claims in federal court.
This article attempts to address this question about the impact of the plausibility standard from Twombly and Iqbal on two classes of civil rights complaints: those alleging claims of employment and housing discrimination. Early studies raising this question showed a less dramatic effect on these and other types of cases from these precedents than the early critics feared would unfold. Yet these studies had their limitations, most notably, they reviewed dismissal rates in all manner of motions to dismiss, not just those based on the specificity of the pleadings: which is, of course, the central issue in Twombly and Iqbal. Furthermore, by looking at a wide range of motions, these previous studies failed to note a significant impact of the Iqbal precedent in particular: the dramatic rise in the volume of civil rights cases dismissed in its wake. In addition, other studies looked exclusively at quantitative results, with no assessment of the manner in which the plausibility standard was being applied by the lower courts. This empirical study attempts to fill these gaps in the empirical research.
The study yielded a series of findings, some of which are consistent with the initial fears about the impact of Twombly and Iqbal, others not. Surprisingly, the dismissal rate in this class of cases during a set time-period immediately after the Twombly decision was actually lower than the dismissal rate of decisions issued in the time period prior to the issuance of that decision. Then, after Iqbal, the dismissal rate increases considerably. The dismissal rates for all cases pre-Twombly was 61%; between Twombly and Iqbal, it was 56%; but then after Iqbal, it was 72%, an 18% increase from the pre-Twombly period analyzed. Another outcome that may not be consistent with the original fears about the impact of these precedents is that while the overall dismissal rate may have increased after Iqbal, the rate of cases dismissed with prejudice increases only slightly across the three time periods.
At the same time, plaintiffs were far more likely after Iqbal than either before Twombly or immediately thereafter to face a motion to dismiss challenging the sufficiency of the pleadings in the cases analyzed. Indeed, decisions on such motions were generated only 12 times in the first quarter of 2004 (the first quarter analyzed in this study), but then 61 times in the third quarter of 2010 (the last full quarter analyzed): a greater than 500% increase. Moreover, looking just at the sheer volume of decisions dismissing cases, either in whole or in part, before and after Twombly, and then after Iqbal, this number rises dramatically, with just 54 granted motions before Twombly, 71 immediately after Twombly, but then 174 after Iqbal, a roughly 350% increase from the first time period to the last.
Another surprising outcome, one that raises questions about the true value of the plausibility standard in a way that few predicted relates to the manner in which the standard is being deployed. Indeed, when it comes to the substance of these decisions, it would appear that the plausibility standard is rarely finding its way into judicial decisions, at least in the way the Court deployed it in Twombly and Iqbal.. Despite the increased dismissal rate following Iqbal, oddly, in a class of cases analyzed for this study, courts rarely invoked the plausibility standard in the same manner it was utilized by the Court in Twombly and Iqbal; that is, courts rarely found that dismissal was warranted if there was an equally plausible, and entirely legal, basis for the challenged conduct. Indeed, far more often than not, courts appear to do anything but utilize the plausibility standard at all: either ignoring it altogether, or deploying it in ways different from what the Court appears to have intended. Finally, and similarly, judges rarely, if ever, appear to invoke their own “experience and common sense,” as urged to by the Court, when ruling on motions to dismiss in these cases.
Perhaps these findings raise more questions than they answer. Do they suggest that courts are ignoring the substance of the heightened pleading standard, yet interpreting Twombly and Iqbal as license to dismiss cases more readily? Does the nature of the standard leave judges with broad discretion to dismiss cases that do not comport with their “experience and common sense”?, In any event, two things are clear: motions to dismiss challenging the sufficiency of the pleadings are much more common since Iqbal, and far more cases are being dismissed after the release of that decision than before. At least in this regard, then, the initial fears about the impact of Twombly and Iqbal seem well founded, regardless of whether the dismissal rates have changed dramatically.
Number of Pages in PDF File: 57
Keywords: Federal Pleadings Standards, Civil Rights
JEL Classification: K41
Date posted: October 10, 2011 ; Last revised: April 2, 2015