In a recent ruling, the U.S. District Court for the District of Kansas extended the application of the pleading standards set forth in Bell Atlantic v. Twombly and Ashcroft v. Iqbal to affirmative defenses in products liability actions. The decision in Hayne v. Green Ford Sales, Inc., 2:09-cv-02202, Dec. 22, 2009, signifies a trend among a growing majority of jurisdictions that have chosen to apply the “heightened” pleading standards in federal cases to affirmative defenses.
The U.S. Supreme Court’s 2007 decision in Twombly created a plausibility pleading standard, holding that a party’s factual allegations “must be enough to raise a right to relief above the speculative level.” The new standard essentially overruled the longstanding pleading standard set forth 50 years earlier in Conley v. Gibson, which allowed a plaintiff’s claim to survive a motion to dismiss for failure to state a claim unless there is “no set of facts in support of his claim which would entitle him to relief.”
Though the Twombly decision involved an antitrust violation claim under the Sherman Act, its pleading standard was applied to other claims as well, most notably in the 2009 case, Ashcroft v. Iqbal. In Iqbal, the Supreme Court held that the Twombly standard applies to allegations of purposeful and unlawful discrimination. Not only did the Supreme Court apply Twombly to discrimination claims, but it also explicitly extended it to all civil actions. What Iqbal did not do, however, is address whether this expansion of Twombly applies to affirmative defenses as well.
The issue as to whether Twombly should apply to defenses was addressed in a handful of courts, with a majority choosing to extend the heightened pleading standard in such cases. The District Court in Hayne chose to join this majority and applied the Twombly standard to affirmative defenses in products liability claims. In Hayne, the defendant asserted a number of affirmative defenses in response to the plaintiffs’ claims of breach of the implied warranty of merchantability and violation of the Kansas Consumer Protection Act. The plaintiffs then moved to strike the defenses pursuant to Fed. R. Civ. P. 12(f), arguing that the defenses lacked a reasonable factual basis. After noting that both parties skirted the issue of what pleading standard to apply to the defenses, the Court addressed the matter sua sponte, ultimately choosing to follow the majority of courts that previously had ruled on this issue. The Court then applied the Twombly standard to the affirmative defenses, granting plaintiffs’ motions, but allowing the defendant the opportunity to amend its pleadings.
This decision is an important one because it shows that the heightened pleading standards apply to both the complaint as well as the answer, and parties can no longer allege generic claims or defenses. Instead, the complaint or answer must show that the person filing the pleading has a non-speculative right to relief. In the meantime, a bill currently pending in the U.S. Senate would overturn the Supreme Court’s rulings in Twombly and Iqbal. The Notice Pleading Restoration Act, sponsored by Senator Arlen Specter of Pennsylvania, would restore the pre-Twombly “no set of facts” pleading standard set forth in Conley v. Gibson. Proponents argue that the Act will reverse the heightened pleading standard that some consider a major obstacle to the pursuit of meritorious claims. Critics are concerned that the Act is too vague, incorporating a standard by reference to Conley instead of explicitly identifying a standard a federal court should apply. Others have expressed concern that the bill does nothing to resolve the question of what pleading standard should be applied to defenses. Until Congress acts on this measure, the heightened pleading standards from Twombly and Iqbal still apply to federal civil actions, and unless the Act is amended to incorporate defenses, it is likely that courts will continue to split over how to apply these standards in those instances.
For more information, please contact one of the authors of this alert, or your Michael Best attorney.