Twombly’s Impact on Motions to Dismiss

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Daniel Crane, May 22, 2007

Yesterday, in the Twombly case, the U.S. Supreme Court ruled that plaintiffs alleging a contract, combination, or conspiracy in violation of Section 1 of the Sherman Act must plead more than the conclusion that the defendants agreed to the illegal conduct. They must assert facts that, if proven true, would plausibly support the inference that the defendants conspired to commit an antitrust violation. Twombly is an important decision for Section 1 cases specifically and for all antitrust cases more generally. At issue is the degree to which courts will employ the two critical screening moments in civil litigation–motion to dismiss and summary judgment–to weed out unmeritorious cases. Before Twombly, the Court had already implemented a rigorous screen at the summary judgment stage, admonishing district courts to throw out cases that were not economically plausible. Summary judgment prevents cases from going to juries, which are often ill-equipped to resolve complex matters of industrial policy. Data collected by the administrative offices of the federal courts suggest that only about one percent of all filed anitrust cases end up in front of juries. The question that Twombly raises is whether the motion to dismiss stage should be used as aggressively as a screen as the summary judgment stage. Whereas summary judgment prevents cases from getting to juries, a motion to dismiss