American Law Institute – American Bar Association Employment Law Update: The Implications of Iqbal ) by Robert B. Fitzpa

1. American Law Institute – American Bar Association Employment Law Update: The Implications of Iqbal) by Robert B. Fitzpatrick, Esq. Robert B. Fitzpatrick, PLLC with research assistance from Aram Farber of the Philadelphia Bar

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3. Ashcroft v. Iqbal 129 S. Ct. 1937, 2009 U.S. LEXIS 3472 May 18, 2009 • Summary of Holding: • In a Bivens action filed against numerous federal officials by a Pakistani national detained on charges related to the September 11, 2009 terrorist attacks, the Court held that District Courts should dismiss complaints not supported by factual allegations sufficient to “state a claim to relief that is plausible on its face.” The Court went on to state that “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” • On this standard, the detainee’s Bivens complaint was dismissed as it was merely premised on conclusory statements rather than on factual allegations, and the case was remanded to the district court to determine whether the detainee should be given the opportunity to amend his complaint.. • Also, the Court held that this pleading standard, previously enunciated in Bell Atlantic v. Twombly, 550 U.S. 544 (2007), applies to all complaints filed in federal court, including claims of intentional discrimination. • Votes & Opinions: • 5-4 decision. • Majority opinion written by Justice Kennedy. • 1 dissenting opinion, written by Justice Souter. • Briefs: • For a copy of all of the briefs and other documents in this case, see: http://www.scotuswiki.com/index.php?title=Ashcroft%2C_Former_ATT%27Y_Gen._v._Iqbal.

4. Ashcroft v. Iqbal 129 S. Ct. 1937, 2009 U.S. LEXIS 3472 May 18, 2009 • For a Sampling of Secondary Sources Discussing this Opinion, see: • Andree Sophia Blumstein, An Update on the New Federal – And Tennessee? – Pleading Standard: Twombly gets Iqbal-ed, 45 Tenn. B.J. 23 (2009). • A. Benjamin Spencer, Understanding Pleading Doctrine, 108 Mich. L. Rev. 1 (2009). • Kevin M. Clermont, Federal Courts, Practice & Procedure: Litigation Realities Redux, 84 Notre Dame L. Rev. 1919 (2009). • Maxwell S. Kennerly, Ashcroft v. Iqbal: Not Nearly as Important As You Think, June 29, 2009, http://www.litigationandtrial.com/2009/06/articles/the-law/for-lawyers/ashcroft-v-iqbal-not-nearly-as-important-as-you-think/. • Bingham Blog, Ashcroft v. Iqbal – Supreme Court Affirms and Clarifies the Pleadings Requirements and Motion to Dismiss Standards Articulated in Bell Atlantic v. Twombly, May 21, 2009, http://www.bingham.com/Media.aspx?MediaID=8660.

5. Ashcroft v. Iqbal (continued) 129 S. Ct. 1937, 2009 U.S. LEXIS 3472 May 18, 2009 • Legislative Reaction: • The Notice Pleading Restoration Act of 2009 (S. 1504) (introduced July 22, 2009), http://www.govtrack.us/congress/bill.xpd?bill=s111-1504. • Bahar Dejban, Will the Notice Pleading Restoration Act be Enough?, Aug. 24, 2009, http://www.consumeradvocatelegalupdate.com/tags/notice-pleading-restoration-ac/. • ACS Blog, Senator Introduces Bill to Address High Court Decisions on Civil Lawsuits, July 24, 2009, http://www.acslaw.org/node/13821. • Michael C. Dorf, Should Congress Change the Standard for Dismissing a Federal Lawsuit?, July 29, 2009, http://writ.news.findlaw.com/dorf/20090729.html. • Briefs: • Robert, L. Abell, JD Supra.com, Lisa Allen v. Bon Secours Health System, Inc., et al, Plaintiff’s Memorandum in Opposition to Defendant’s Motion to Dismiss, Aug. 18, 2009, available athttp://www.jdsupra.com/post/documentViewer.aspx?fid=413ec683-df84-4322-a7f2-aabb0232c92e.

6. Ashcroft v. Iqbal (continued) 129 S. Ct. 1937, 2009 U.S. LEXIS 3472 May 18, 2009 • For examples of cases applying Iqbal in the employment law context, see: • Maxey v. Rest. Concepts II, LLC, 2009 U.S. Dist. LEXIS 78514 (D. Colo. 2009) and Zawacki v. Realogy Corp., 628 F. Supp. 2d 274 (D. Conn. 2009) (discussing how Iqbal and Gross affect pleading in cases brought under the ADEA and factually related claims brought under state law). • United States ex rel. Lacy v. New Horizons, Inc, et. al., 2009 U.S. App. LEXIS 22294 (10th Cir. Oct. 9, 2009) (applying Twombly and Iqbal in a False Claims Act and improper discharge case). • For examples of cases holding or at least suggesting that Iqbal also applies to the defendant’s burden in pleading affirmative defenses, see: • Sales Board v. Pfizer, 2009 U.S. Dist. LEXIS 69714 at *19-20 (D. Minn. Aug. 10, 2009) (holding that Iqbal applies to affirmative defenses and stating that affirmative defenses must be based on factual allegations that give rise to the relief requested); • Kaufmann v. Prudential Ins. Co. of Am., 2009 U.S. Dist. LEXIS 68800 at *2 (D. Mass. Aug. 6, 2009) (holding that “the court is inclined to think that a defendant has the same Rule 8 obligations with respect to notice pleading as does a plaintiff”); • Fogel v. Linnemann (In re Mission Bay Ski & Bike, Inc.), 2009 Bankr. LEXIS 2495 at *15-16 (Bankr. N.D. Ill. Sep. 9, 2009) (“Affirmative defenses are pleadings and so are subject to all pleading requirements under the Federal Rules…. That means affirmative defenses must meet the notice-pleading standards of Rule 8(a) as the Supreme Court recently interpreted them in Bell Atlantic Corp. v. Twombly… and Ashcroft v. Iqbal”); • Safeco Ins. Co. of Am. v. O'Hara Corp., 2008 U.S. Dist. LEXIS 48399 at *1 (E.D. Mich. June 25, 2008) (Twombly standards apply to affirmative defenses); • Holtzman v. B/E Aerospace, Inc., 2008 U.S. Dist. LEXIS 42630 at *2 (S.D. Fla. May 28, 2008) (same).

7. Ashcroft v. Iqbal (continued) 129 S. Ct. 1937, 2009 U.S. LEXIS 3472 May 18, 2009 • For examples of cases distinguishing and/or criticizing Iqbal, see: • al-Kidd v. Ashcroft, 2009 U.S. App. LEXIS 20000, at *37, *71-*81 (9th Cir. September 4, 2009) (in another case dealing with detainment for terrorism-related charges, the Court held that the Plaintiff had pled sufficient facts to support his claim that his detention violated the Fourth Amendment. In dicta, the Court also appeared to downplay the importance of Bell Atlantic and Twombly by stating that even before those cases, “it was likely that conclusory allegations of motive, without more, would not have been enough to survive a motion to dismiss.”) • Smith v. Duffey, 576 F.3d 336, 340 (7th Cir. May 11, 2009) (affirming dismissal of a suit under Rule 12(b)(6), because the plaintiff’s case would have had no merit even before Bell Atlantic or Iqbal, but also suggesting in dicta that the heightened pleadings standard espoused by Bell Atlantic and Iqbal might be limited to complex cases with intrusive discovery – such as Bell Atlantic; or to those cases dealing with other compelling interests for avoiding litigation, such as ensuring that high-level officials are granted official immunity for their official actions – such as Iqbal). • Tyree v. Zenk, 2009 U.S. Dist. LEXIS 43872, at *20-21 (E.D.N.Y. May 22, 2009) (holding that, unlike in Iqbal, Plaintiff had pled sufficient factual allegations to survive a motion to dismiss.)

8. The Implications of Ashcroft v. Iqbal for Employment Lawyersby Aram Farber Iqbal has already influenced judicial decision-making. See Maxey v. Rest. Concepts II, LLC, 2009 U.S. Dist. LEXIS 78514 (D. Colo. 2009) and Zawacki v. Realogy Corporation, 628 F. Supp. 2d 274 (D. Conn. 2009) (discussing the application of Iqbal to age discrimination cases).

9. Strategy and Tactics after Iqbal For strategic purposes, counsel may conclude that it is advantageous to bring an action in state court rather than, or sometimes in addition to, the federal court when that option is available. For example, even if a state court discrimination claim is removed to federal court and dismissed pursuant to Iqbal, the federal court may decline to exercise supplemental jurisdiction over the state law claim and may remand that claim to state court for further proceedings. Maxey v. Rest. Concepts II, LLC, 2009 U.S. Dist. LEXIS 78514 (D. Colo. 2009) (finding that the federal and state law discrimination claims were “premised on different sets of operative facts.”) For more details on Iqbal’s significance for employment lawyers, see Supreme Court Update to Defusing Workplace Time-Bombs