The recent United States Supreme Court decision in Ashcroft v. Iqbal may have placed the entrenched legal principle of notice pleading in limbo. Notice pleading, which requires that a complaint only contain a short and plain statement of the cause of action, is the relaxed pleading standard used in federal court. Just as the name suggests, notice pleading requires that a plaintiff give the defendant notice of the claim without stating an elaborate factual background. The rationale of notice pleading is to permit a plaintiff who has a reasonable, but imperfect, case to first file a complaint, put the other side on notice of the lawsuit, and then strengthen the case by compelling the defendant to produce evidence during the discovery phase.

In Ashcroft, the Supreme Court considered notice pleading in a civil rights action filed by a Muslim Pakistani who was arrested after the September 11 terrorist attacks. The plaintiff sued senior government officials, claiming that he was illegally detained based only upon his race and religion. The Court dismissed the suit, determining that the plaintiff simply alleged conclusions in his complaint and failed to state enough facts to show that senior government officials specifically ordered the discrimination. The Court noted that while notice pleading does not require a hyper-technical complaint, a bare-bones complaint would not unlock the door to discovery. Further, the Court concluded that a complaint must allege a "plausible" claim.

The Ashcroft decision expands upon a previous Supreme Court ruling in Bell Atlantic Corp. v. Twombly. There, the Court considered a class action antitrust claim against telephone service carriers that allegedly conspired to prevent competition. The plaintiffs based their claim on allegations that each of the telephone service carriers engaged in the same business, but did not compete against each other even though the opportunity presented itself. The Court dismissed the complaint, determining that the plaintiffs could not simply allege that the defendants engaged in the same business to state an antitrust claim; instead, the plaintiffs needed to state plausible facts that showed the antitrust activity.

Decision May Discourage Federal Civil Actions

What is the practical impact of these decisions? If plaintiffs are required to state more facts in a complaint, it may be more difficult to bring civil actions in federal court. This will clearly weigh in favor of defendants and discourage plaintiffs' actions. Additional facts will need to be gathered before filing a complaint, and defendants will have a new tool in their arsenal to defeat litigation before conducting costly discovery. Nevertheless, federal circuit court judges may not immediately embrace this increased standard. Because the Ashcroft case arose from an action involving the highly charged issue of terrorism, federal judges may attempt to narrow its interpretation and limit its application. Accordingly, the full impact of this ruling is yet to be seen.

Regardless, because the Ashcroft decision is new and is not completely settled, a business or individual faced with defending or prosecuting a civil action should work with legal counsel experienced in interpreting and arguing changes in the law.