• May 20, 2014

Flower_Alphabet_-_TShould Minnesota courts adopt Twombly/Iqbal standards for pleading?  That’s the question the Minnesota Supreme Court considered last week

The pleading standard lawyers all learned in law school was Conley v. Gibson.  That said, a complaint was viable unless it appeared beyond doubt that the plaintiff could prove no set of facts entitling him or her to relief.  Twombly and Iqbal tightened that standard in federal courts.  Twombly was an federal antitrust case that said allegations of an antitrust conspiracy required more than speculation.  The facts alleged must show that relief is plausible, not just possible.  Iqbal went a step further and made clear that the plausibility standard applies to all cases, not just antitrust cases.

A few Minnesota cases have cited Twombly.  The Minnesota Supreme Court has cited it in a couple cases for the idea that legal conclusions are not binding on the courts in reviewing a complaint. And that plaintiffs must give more than just labels and conclusions but plead sufficient facts.  But no Minnesota cases have adopted the Twombly plausibility standard.  That is the question before the Court now.

Walsh v. U.S. Bank was brought by a woman who lost her home following a foreclosure and sheriff’s sale. The foreclosure documents were left in the doorway of the house when the woman who answered the door refused to identify herself. The complaint did not include much detail, but did allege that the plaintiff had not been served.

The bank brought a motion to dismiss, saying the plaintiff had not brought a claim. The district court granted that motion, citing Twombly and Iqbal. The Court of Appeals then reversed. Which brings us to last week’s courtroom.

Some of the arguments the bank made, in its briefs and at argument:

  • Twombly is more faithful to the language of rule 8.01 which requires that the complaint “show” the plaintiff is entitled to relief.
  • Our Court has historically followed U.S. Supreme Court interpretations of identical rules.
  • And it makes sense to interpret the rules uniformly, so, for example, plaintiffs in removed cases aren’t held to different standards.

And a few of the arguments made by counsel for the woman plaintiff:

  • Minnesota’s interpretation of rule 8 actually predates Conley, and that precedent should be respected.
  • It is difficult to distinguish fact allegations from legal conclusions, so courts should not make that distinction crucial.
  • Plausibility “looks like” probability. Some courts would apply that standard. Differences in how the standards are applied by different courts would lead to a lack of respect for and trust in the courts.
  • And, there would be an increase in motion practice. That would especially hit pro se plaintiffs, “cases where truth really is stranger than fiction,” and cases involving credibility issues.

The justices were very active in their questioning.   And it was not all what I for one expected. A sampling of some of the themes raised:

  • One theme raised by Justices Gildea and Dietzen was concern for setting aside precedent easily.
  • Justice Lillehaug noted all the comment saying that discovery is out of control, and asked why the solution isn’t targeted discovery and case management rather than tighter pleading standards.
  • Justice Gildea then noted that the Court has just gone through an extensive revision of the rules where streamlining was the whole point, and asked whether it didn’t make sense to see how that works out.
  • Justices Stras and Lillehaug asked whether it wouldn’t be more appropriate to go through rule-making to change the standard, rather than doing that through one case.
  • And there was some discussion about the difference between a legal conclusion and a fact allegation. At issue in the case is a pleading that says, in essence, “You didn’t serve me.” The parties view that differently, the bank as a legal conclusion and the plaintiff as a fact.   From the questioning, some of the justices seem to view it differently as well. Justice G. Barry Anderson expressed some concern about trying to distinguish between the two, noting difficulties in doing so in evaluating expert affidavits in medical malpractice cases.

If you want to see the argument and questioning for yourself, check the video of the argument online on the Courts website.

The arguments were very well made, and the Court’s interest high. Keep your eyes open for a decision down the road.

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