[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]


 
                   OPEN ACCESS TO COURTS ACT OF 2009 

=======================================================================

                                HEARING

                               BEFORE THE

                       SUBCOMMITTEE ON COURTS AND
                           COMPETITION POLICY

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                                   ON

                               H.R. 4115

                               __________

                           DECEMBER 16, 2009

                               __________

                           Serial No. 111-124

                               __________

         Printed for the use of the Committee on the Judiciary


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                       COMMITTEE ON THE JUDICIARY

                 JOHN CONYERS, Jr., Michigan, Chairman
HOWARD L. BERMAN, California         LAMAR SMITH, Texas
RICK BOUCHER, Virginia               F. JAMES SENSENBRENNER, Jr., 
JERROLD NADLER, New York                 Wisconsin
ROBERT C. ``BOBBY'' SCOTT, Virginia  HOWARD COBLE, North Carolina
MELVIN L. WATT, North Carolina       ELTON GALLEGLY, California
ZOE LOFGREN, California              BOB GOODLATTE, Virginia
SHEILA JACKSON LEE, Texas            DANIEL E. LUNGREN, California
MAXINE WATERS, California            DARRELL E. ISSA, California
WILLIAM D. DELAHUNT, Massachusetts   J. RANDY FORBES, Virginia
ROBERT WEXLER, Florida               STEVE KING, Iowa
STEVE COHEN, Tennessee               TRENT FRANKS, Arizona
HENRY C. ``HANK'' JOHNSON, Jr.,      LOUIE GOHMERT, Texas
  Georgia                            JIM JORDAN, Ohio
PEDRO PIERLUISI, Puerto Rico         TED POE, Texas
MIKE QUIGLEY, Illinois               JASON CHAFFETZ, Utah
JUDY CHU, California                 TOM ROONEY, Florida
LUIS V. GUTIERREZ, Illinois          GREGG HARPER, Mississippi
TAMMY BALDWIN, Wisconsin
CHARLES A. GONZALEZ, Texas
ANTHONY D. WEINER, New York
ADAM B. SCHIFF, California
LINDA T. SANCHEZ, California
DEBBIE WASSERMAN SCHULTZ, Florida
DANIEL MAFFEI, New York

       Perry Apelbaum, Majority Staff Director and Chief Counsel
      Sean McLaughlin, Minority Chief of Staff and General Counsel
                                 ------                                

             Subcommittee on Courts and Competition Policy

           HENRY C. ``HANK'' JOHNSON, Jr., Georgia, Chairman

JOHN CONYERS, Jr., Michigan          HOWARD COBLE, North Carolina
RICK BOUCHER, Virginia               JASON CHAFFETZ, Utah
ROBERT WEXLER, Florida               BOB GOODLATTE, Virginia
CHARLES A. GONZALEZ, Texas           F. JAMES SENSENBRENNER, Jr., 
SHEILA JACKSON LEE, Texas            Wisconsin
MELVIN L. WATT, North Carolina       DARRELL ISSA, California
MIKE QUIGLEY, Illinois               GREGG HARPER, Mississippi
DANIEL MAFFEI, New York

                    Christal Sheppard, Chief Counsel

                    Blaine Merritt, Minority Counsel































                            C O N T E N T S

                              ----------                              

                           DECEMBER 16, 2009

                                                                   Page

                                THE BILL

H.R. 4115, the ``Open Access to Courts Act of 2009''.............     3

                           OPENING STATEMENTS

The Honorable Henry C. ``Hank'' Johnson, Jr., a Representative in 
  Congress from the State of Georgia, and Chairman, Subcommittee 
  on Courts and Competition Policy...............................     1
The Honorable Howard Coble, a Representative in Congress from the 
  State of North Carolina, and Ranking Member, Subcommittee on 
  Courts and Competition Policy..................................     6
The Honorable John Conyers, Jr., a Representative in Congress 
  from the State of Michigan, Chairman, Committee on the 
  Judiciary, and Member, Subcommittee on Courts and Competition 
  Policy.........................................................     8
The Honorable Bob Goodlatte, a Representative in Congress from 
  the State of Virginia, and Member, Subcommittee on Courts and 
  Competition Policy.............................................    12

                               WITNESSES

The Honorable Jerrold Nadler, a Representative in Congress from 
  the State of New York
  Oral Testimony.................................................    14
  Prepared Statement.............................................    17
Mr. Eric Schnapper, Professor of Law, University of Washington, 
  School of Law, Seattle, WA
  Oral Testimony.................................................    23
  Prepared Statement.............................................    25
Mr. Gregory G. Katsas, former Assistant Attorney General, Civil 
  Division, U.S. Department of Justice, Washington, DC
  Oral Testimony.................................................    65
  Prepared Statement.............................................    67
Mr. Jonathan L. Rubin, Patton Boggs, LLP, Washington, DC
  Oral Testimony.................................................   110
  Prepared Statement.............................................   112
Mr. Joshua P. Davis, Professor, Center for Law and Ethics, 
  University of San Francisco, School of Law, San Francisco, CA
  Oral Testimony.................................................   147
  Prepared Statement.............................................   150

                                APPENDIX
               Material Submitted for the Hearing Record

Prepared Statement of the Committee to Support the Antitrust Laws 
  (COSAL)........................................................   257


                   OPEN ACCESS TO COURTS ACT OF 2009

                              ----------                              


                      WEDNESDAY, DECEMBER 16, 2009

              House of Representatives,    
                 Subcommittee on Courts and
                                 Competition Policy
                                Committee on the Judiciary,
                                                    Washington, DC.

    The Subcommittee met, pursuant to notice, at 2:26 p.m., in 
room 2237, Rayburn House Office Building, the Honorable Henry 
C. ``Hank'' Johnson, Jr. (Chairman of the Subcommittee) 
presiding.
    Present: Representatives Johnson, Conyers, Coble, and 
Goodlatte.
    Staff present: (Majority) Christal Sheppard, Subcommittee 
Chief Counsel; Elisabeth Stein, Counsel; Rosalind Jackson, 
Professional Staff Member; and (Minority) Paul Taylor, Counsel.
    Mr. Johnson. The hearing of the Committee on the Judiciary, 
Subcommittee on Courts and Competition Policy, will now come to 
order.
    And without objection, the Chair will be authorized to 
declare a recess of this hearing.
    I now recognize myself for a short statement. First, I will 
say that a little fire to put out caused me to be detained, and 
so I want to apologize to everyone for not getting this meeting 
started on time.
    And access to the courts and the ability for claims to be 
heard by a judge or jury are fundamental to our system of 
justice. For over 50 years, courts have used the Conley 
standard to ensure that plaintiffs had the opportunity to 
present their case to a Federal judge even when they did not 
yet have the full set of facts.
    The court in Conley set a relatively low bar that is, 
effectively, a non-plausibility standard. Only if the plaintiff 
could prove no set of facts in support of his or her claim 
would he or she fail to survive a 12(b)(6) motion to dismiss.
    And in Twombly, a Section 1 antitrust case, the Supreme 
Court revised the Conley standard to require, ``plausible 
grounds'' which provide enough facts to raise a reasonable 
expectation that discovery will reveal evidence of an illegal 
agreement.
    However, it was not clear whether the court intended for 
the standard--this standard to apply only to antitrust cases. 
In its Iqbal decision, the court clarified that the 
plausibility standard not only applies to antitrust cases but 
to all civil cases.
    Further, the court clarified that plausibility--
``Plausibility is a context-specific task that requires the 
reviewing court to draw on its judicial experience and common 
sense.''
    One critic of this decision commented that this is a 
subjective standard and it could prove devastating to civil 
rights cases.
    What we have effectively seen is a gradual ratcheting up of 
the standard that plaintiffs must plead to survive a motion to 
dismiss. This raises several concerns in my mind, and I am 
particularly concerned that those who need it most will be 
denied access to the courts under Iqbal, under the pleading 
standard.
    As Chairman of this Subcommittee, I believe it is extremely 
important that plaintiffs be able to survive an initial motion 
to dismiss when the facts in question can only be answered by 
information completely in the hands of the defendant alone.
    In discrimination cases, including gender, race and 
employment discrimination, it is frequently only through the 
discovery process that plaintiffs are able to identify non-
public information that would support their claims.
    Initial studies have indicated that dismissals have 
increased as much as 10 percent in the 7 months since the court 
decided Iqbal.
    In fact, we already know that employment discrimination 
claims, which the Supreme Court held were explicitly not 
subject to a heightened pleading standard in Swierkiewicz, are 
now subject to the plausibility standard.
    I am also concerned that the Supreme Court may 
inadvertently--may have inadvertently subverted the Rules 
Enabling Act process which Congress established and which the 
Judicial Conference carries out every year.
    The Rules Enabling Act calls for a deliberate process where 
the Judiciary, Congress and the bar can weigh in on potential 
rule changes.
    The court is certainly entitled to change its legal 
interpretation of the Conley pleading standard. However, there 
is a legitimate argument that such a change in the pleading law 
ought to be done through the Rules Enabling Act process.
    Even members of the Supreme Court have noted that the Iqbal 
decision may have changed the Federal rules. In the words of 
Justice Ginsberg, the Supreme Court may have ``messed up the 
Federal rules.''
    The proposed legislation, H.R. 4115, that we are 
considering today was introduced by Congressman Nadler, 
Chairman Conyers and myself earlier this year.
    And the bill, which is entitled ``Open Access to Courts Act 
of 2009,'' is an attempt to clarify the pleading standard and 
ensure that any plaintiff with a valid claim will have an 
opportunity for discovery.
    I look forward to the testimony from today's witnesses, the 
first of which is the primary author of the bill, Mr. Jerry 
Nadler, and I look forward to the testimony of the panel when 
its time comes.
    And I look forward to hearing whether or not you think the 
proposed legislation will help clarify the state of notice 
pleading jurisdiction.
    [The bill, H.R. 4115, follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
                              ----------                              

    Mr. Johnson. I now recognize my colleague, Mr. Coble, the 
distinguished Ranking Member of the Subcommittee, for his 
opening remarks.
    Mr. Coble. Thank you, Mr. Chairman.
    Mr. Chairman, we are here today to discuss proposed 
legislation H.R. 4115 that would overturn the Supreme Court's 
decision in Iqbal v. Ashcroft. In that decision, decided last 
May, the Supreme Court held that a lawsuit could only go 
forward if a plaintiff has a plausible claim, which the court 
defined as ``factual content that allows the court to draw the 
reasonable inference that the defendant is liable for the 
misconduct alleged.''
    In so holding the Supreme Court reaffirmed the longstanding 
principle that a lawsuit based solely upon the bald and 
conclusory assertions should not proceed to the discovery stage 
of litigation.
    The Supreme Court in Iqbal, Mr. Chairman, dismissed the 
lawsuit on the ground that a terrorism detainee's complaint 
failed to plead sufficient facts to state an intentional 
discrimination claim against government officials, including 
the director of the FBI and the attorney general.
    Mr. Iqbal was arrested in the United States on criminal 
charges and detained by Federal officials after the September 
11 terrorist attacks. He pleaded guilty to the criminal 
charges, served time in prison and was removed to his native 
Pakistan.
    But then he indiscriminately sued high-level government 
officials, arguing that they were somehow responsible for 
allegedly tough treatment he received while in prison. The 
issue in this case was whether Mr. Iqbal had alleged claims 
against the Federal officials that were reasonably specific 
enough to allow the case to proceed.
    The Supreme Court held he had not, stating as follows: The 
pleading standard, Federal Rule 8, analysis does not require 
detailed factual allegations, but it demands more than an 
unadorned the--defendant-unlawfully-harmed-me accusation.
    A pleading that offers labels and conclusions or a 
formulaic recitation of the elements of a cause of action will 
not do. Nor does a complaint suffice if it tenders naked 
assertions devoid of further factual enhancement.
    The best evidence indicates that Iqbal decision was simply 
a reiteration of well-settled case law and consequently the 
Federal courts have continued to allow plausible claims to go 
forward while dismissing factually baseless claims.
    The most comprehensive study to date of how the Federal 
courts have applied the Iqbal decision is currently being 
performed by the Advisory Committee on Civil Rules within the 
Judicial Conference of the United States, which is chaired by 
United States District Court Judge Mark Kravitz.
    An advisory committee memo recently explained that at this 
early stage of the development of the case law discussing and 
applying the Iqbal pleading, standards--the Iqbal pleading 
standards, it is difficult to draw many generalized conclusions 
as to how the courts are interpreting and applying that 
decision.
    Overall, the memorandum concludes the case law does not 
appear to indicate a major change in the standards used to 
evaluate the sufficiency of complaints. The Iqbal decision has 
certainly not led to a wholesale dismissal of lawsuits.
    A recently released letter from the Judicial Conference 
states that the official research body of the Federal courts 
conducted an empirical review of the 94 Federal court dockets, 
comparing the granting of motions to dismiss before and after 
the Iqbal decision. The data shows that the Iqbal decision has 
not resulted in an increase in the dismissal of civil rights 
suits.
    Indeed, courts have continued to deny motions to dismiss in 
cases involving claims against government officials for actions 
undertaken in defending the country against terrorist attack as 
well as in the cases involving commercial claims. Likewise, 
complaints alleging civil rights claims have survived motions 
to dismiss.
    In sum, all the evidence to date indicates it would be 
premature at best for the Congress to statutorily disrupt the 
court's reasonable application of longstanding precedents. 
These precedents go back many decades, Mr. Chairman.
    As early as 1972, the Second Circuit explained that even 
under the liberal Federal Rules of Civil Procedure, a bare-
bones statement of conspiracy or an injury without any 
supporting facts permits dismissal.
    In reviewing the sufficiency of a constitutional claim in 
1968, the Supreme Court held that for the purposes of this 
motion to dismiss we are not bound to accept as true a legal 
conclusion couched as a factual allegation.
    Dozens of lower court decisions applied the same standard, 
refusing to credit a complaint's bald assertions, unsupported 
conclusions, unwarranted inferences or the like when deciding a 
motion to dismiss for failure to state a claim.
    Further, even if some of the lower courts conclude that 
some lawsuits can't pass muster, courts continue to have the 
power under the Federal Rules of Civil Procedure to permit 
plaintiffs to amend their complaints.
    Courts continue to allow plaintiffs the opportunity to 
amend their complaints to provide more specifics and to re-file 
their cases in a way that allows them to proceed.
    Finally, courts can and should continue to perform an 
essential gatekeeping function. They have a responsibility to 
ensure that the courts are not overwhelmed with frivolous cases 
and that defendants are not hauled into court on a whim.
    The Federal courts themselves have not indicated they are 
having problems applying the Iqbal decision as it was nothing 
more than a reaffirmation of longstanding case law.
    I have an open mind on this topic, Mr. Chairman, although I 
am not embracing it warmly, as you can tell by my statement.
    But unless and until the Federal courts themselves indicate 
there is a reason for Congress to intervene, there is much 
reason to believe that any statutory amendments to the existing 
rule could very likely do more harm than good.
    And I thank you again, Mr. Chairman, for having called this 
hearing.
    Thank the panelists for appearing.
    And I yield back my time.
    Mr. Johnson. Thank you, Congressman Coble.
    I will, in response, say that I am happy that you have an 
open mind on this issue, as I do, but I will tell you that the 
issue of pretrial discovery is important to litigants because 
it--much of it puts people under oath and there is an 
opportunity to learn the real truth and thus amend the 
pleadings, as opposed to going through this nebulous standard 
which the Supreme Court has imposed.
    I thank the gentleman for his statement, and I now 
recognize Mr. John Conyers, a distinguished Member of this 
Subcommittee and also the Chairman of the Committee on 
Judiciary.
    Mr. Conyers. Thank you, Chairman Johnson.
    Could we offer a series of condolences for Committee 
Chairman Nadler, who has been forced to sit through our 
lectures to him and the audience? Normally he is on this side 
of the hearing process, and he gives lectures himself.
    And now he has to receive them before he can make his 
statement. I don't know if that is justice--retributable 
justice, or if it is unfair or what, Jerry, but----
    Mr. Nadler. Turnabout is always fair play.
    Mr. Conyers. Well, it looks like that is what might be 
happening this afternoon.
    But I am proud to join with Chairman Nadler and Chairman 
Johnson in trying to examine this whole question of access to 
the courts, and that is really what we are here to examine 
today.
    And it seems to turn mostly around the Supreme Court 
decisions of Bell Atlantic v. Twombly and the other case of 
Ashcroft v. Iqbal.
    And what we are trying to do is deal with a phenomenon that 
has been noted in The Nation magazine by Herman Schwartz, 
September 30 of this year, 2009, in which this distinguished 
lawyer and professor had published an article entitled ``The 
Supreme Court Slams the Door.''
    And I just want you to hear these two sentences. The 
Supreme Court ruling--and also ask unanimous consent that it be 
included in the record.
    [The information referred to follows:]

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
                               __________

    Mr. Conyers. The Supreme Court ruling in May, Ashcroft v. 
Iqbal, on how much information civil complaints in a lawsuit 
must contain, might seem a narrow technical matter of interest 
only to lawyers and law journals. Yet it is on just such 
technicalities that the legal rights of victims of public or 
private wrongdoings often hang. For almost four decades, the 
court's right wing has been perfecting such technicalities as 
legal weapons to deny Americans an opportunity to enforce their 
rights in court.
    And they go on to point out, as I do in the rest of my 
statement, that there are a couple of classes of litigants that 
could be very negatively impacted. And the first that come to 
mind is the fact that there will be a number of civil rights 
and civil liberties cases that could be negatively affected.
    And the claim of weeding out non-meritorious claims sounds 
quite appropriate, but sometimes these decisions may throw out 
the baby with the bath water.
    Studies have shown that the dismissal rules are up quite a 
bit, and that the protection of civil rights is--and this 
always normally ends up in Federal court--is essential. And the 
Supreme Court is now, through cleverly narrowing the rules of 
procedure, making it harder and harder for those kinds of cases 
to find their way into court.
    And what we have is studies that show that these dismissals 
under 12(b)(6) are up 10 percent. Behind these statistics are 
numbers, countless numbers, of people who have suffered an 
injustice and are unable, therefore, to seek redress in court.
    Now, some believe that these dismissals are higher for 
cases involving race, gender and employment discrimination. And 
it is often difficult to secure evidence that the--that 
demonstrates discrimination without first going through 
discovery. And if you can't get through discovery, you never 
can get the case into court in the first instance.
    And so it seems that under these new standards, plaintiffs 
may often be locked out of the courthouse unless they can 
present a sort of smoking gun that shows that there is clear 
evidence of discrimination before you get to the case.
    I can see some--well, some say it is unintentional. Some 
say it is deliberate. But in essence, the plaintiffs have to 
prove their case before they have a chance to gather the 
evidence to prove their claims. And this is not a very good 
picture.
    And finally, the Rules Enabling Act provides a procedure 
for making changes as significant as elevating the pleading 
statement. While the Supreme Court does have the power to 
reverse their prior interpretation, it seems more proper to 
call upon the collective experience of bench and bar to develop 
these sweeping and significant changes in the pleading 
standard.
    And so this is an important hearing. It is not just for 
lawyers alone. And I am glad that Chairman Nadler has been able 
to go through this without too much encroachment. I hope the 
Chair will give him as much time as he needs to make the case 
for our bill.
    And thank you very much, Chairman Johnson.
    Mr. Johnson. Thank you, Mr. Chairman.
    Congressman Nadler, your ordeal will be over with shortly.
    And I want to thank--well, I want to now recognize Mr. Bob 
Goodlatte out of Virginia for his opening statement.
    Mr. Goodlatte. Well, thank you, Mr. Chairman. And, Mr. 
Chairman, I appreciate the opportunity to offer some comments 
on this.
    I think that all of us here would agree, including you, and 
Chairman Conyers and Chairman Nadler as well, that if this 
involved a criminal investigation that we would require that 
somebody, before they got a search warrant of somebody's home, 
to allege some facts, some foundation, for obtaining that 
search warrant.
    So when the Supreme Court in two cases now says that there 
should be a similar standard before a plaintiff can begin the 
process of searching somebody through their documents and their 
depositions, and questioning their family members and friends 
and employees, or whoever the people that may have discoverable 
evidence in a matter can proceed, that they have to allege some 
facts, some foundation, for doing so, seems to me to be very 
reasonable.
    And H.R. 4115, the ``Open Access to Courts Act of 4009,'' 
is an economic stimulus package for trial lawyers. This 
legislation removes any certainty that currently exists with 
regard to the legal standard for determining whether a 
complaint's allegations are sufficient to survive a motion to 
dismiss.
    Incredibly, this legislation literally states that a court 
shall not dismiss a complaint when a judge believes the facts 
alleged do not show the claims to be plausible.
    Similarly, a judge may not dismiss a claim when he believes 
that the facts are insufficient to warrant a reasonable 
inference that the defendant is liable for the misconduct 
alleged. This would overturn Federal rules and decades of 
precedent governing pleading standards.
    The confusion created by this legislation would cause a 
huge flood of claims filed by plaintiffs because now, rather 
than presenting a factual pleading that shows some plausible 
way the defendant could be liable, plaintiffs need only a wild 
allegation and then enjoy access to discovery to try to prove 
their theory.
    The bill's literal text binds the hands of judges from 
throwing cases out that are blatantly frivolous. The result is 
that defendants of all stripes will be forced to open up their 
wallets to foot the bill for discovery costs and attorneys' 
fees to defend even the most ridiculous claims.
    In addition, the bill would overturn any standards that 
Congress has previously passed relating to the required 
substance of complaints. The text explains that the provisions 
of H.R. 4115 would trump everything other than acts of Congress 
passed after the effective date of the bill.
    America's small businesses are hurting. They are not 
receiving capital from banks because banks are being forced to 
invest in the most risk-averse assets like Treasury securities, 
which happen to fund the debt accumulated from big government 
spending.
    They are facing uncertainty about massive new taxes on 
energy and health care as well as penalties for those 
businesses that cannot afford to comply with the new 
regulations in these areas.
    And now we are going to eliminate the very standards that 
protect them from extremely expensive frivolous lawsuits. The 
clear message seems to be that Congress does not want these 
small businesses to succeed or to create new jobs.
    Mr. Chairman, it is getting close to Christmas, but 
American citizens and businesses cannot afford to pay for the 
gift this bill gives to the trial lawyers this year. Indeed, it 
is the gift that keeps on giving.
    And I yield back.
    Mr. Johnson. I thank the gentleman for his statement.
    And without objection, other Members' opening statements 
will be included in the record.
    I am now pleased to introduce our witness on panel one, 
Representative Jerry Nadler, the distinguished representative 
from the 8th District of New York.
    Representative Nadler's district includes parts of 
Manhattan and Brooklyn, and he is a Member of the Judiciary 
Committee where he chairs the Subcommittee on Constitution, 
Civil Rights--Constitution, Civil Rights and Civil Liberties. 
He also serves as the most senior northeastern Member of the 
Committee on Transportation and Infrastructure.
    Mr. Nadler, don't put us through an ordeal to make us pay. 
I will count on Chairman Conyers to rule your time has expired. 
But please proceed with your statement, sir.

TESTIMONY OF THE HONORABLE JERROLD NADLER, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF NEW YORK

    Mr. Nadler. Thank you, Chairman Johnson, Chairman Conyers, 
Ranking Member Coble, other distinguished Members of the 
Subcommittee.
    Thank you for holding today's hearing on H.R. 4115, the 
``Open Access to Courts Act of 2009'', which I introduced with 
Chairman Johnson and Chairman Conyers on November 19th.
    The Supreme Court's decision in Ashcroft v. Iqbal was the 
subject of a hearing I chaired in the Subcommittee on the 
Constitution, Civil Rights, and Civil Liberties on October 26 
entitled ``Access to Justice Denied:
    Ashcroft v. Iqbal.''
    It is the legislative response to that hearing's findings 
that bring us here today. What is really significant about the 
Iqbal decision is that it sets up a very stringent new standard 
that prevents people from having their day in court.
    It does so not based on the evidence or on the law but on 
the judge's own subjective criteria. Rights without remedies 
are no rights at all. That is an ancient legal maxim.
    All Americans are entitled to have access to the courts so 
that their claims can be heard, the evidence weighed, and their 
rights can be vindicated. Without recourse to the courts, our 
rights are merely words on paper.
    In Iqbal, the court established a new test that Federal 
judges must use when ascertaining whether civil complaints will 
withstand a motion to dismiss under Rule 12(b)(6) of the 
Federal Rules of Civil Procedure.
    Rather than questioning, as required under Rule 8(a)(2), 
only that the plaintiff had included ``a short and plain 
statement of the claim showing that the pleader is entitled to 
relief,'' it dismissed the case not on the merits or on the law 
but on the bald assertion that the claim was not plausible.
    In the past, the rule had been, as the Supreme Court stated 
in Conley v. Gibson, that the pleading rules exist to ``give 
the defendant fair notice of what the claim is and the grounds 
upon which it rests,'' not as a substantive bar to 
consideration of the case.
    Now the court has required, in effect, that the pleading 
serve as a substantive bar to the consideration of the case by 
requiring that prior to discovery, courts must somehow assess 
the plausibility of the claim, dismissing claims the court 
finds not plausible--before discovery and without submission of 
evidence.
    This rule will reward defendants who succeed in concealing 
evidence of wrongdoing, since claims will be dismissed before 
discovery can proceed, whether it is government officials who 
violate people's rights, polluters who poison the drinking 
water or employers who engage in blatant discrimination.
    Often, evidence of wrongdoing is in the hands of the 
defendants, and the facts necessary to prove a valid claim can 
only be ascertained through discovery.
    The Iqbal decision overturned--and some of the statements 
of the last few minutes assume that--or asserted that my bill 
would establish a new requirement, a new standard. In fact, it 
will simply reassert the standard that existed for 50 years 
until the Iqbal decision.
    The Iqbal decision has overturned 50 years of precedent and 
will effectively slam shut the courthouse door on legitimate 
plaintiffs based on the judge's subjective take on the 
plausibility of a claim rather than the--on the actual 
evidence.
    At our hearing on Ashcroft v. Iqbal, we heard compelling 
testimony from the witnesses that the Iqbal decision has 
resulted in the substantial departure from previously well-
settled practice in civil litigation.
    Several witnesses said the new standard put forward by the 
Supreme Court to decide a motion to dismiss a civil complaint 
amounts to a heightened pleading standard.
    Professor Arthur Miller of New York University School of 
Law, an expert on civil procedure, testified that ``what we 
have now is a far different model of civil procedure than the 
original design.''
    We also heard from seasoned litigators. John Vail of the 
Center for Constitutional Litigation stated that there is ``no 
doubt that the Supreme Court intended a sea change in pleading 
law.''
    Debo Adegbile of the NAACP Legal Defense Fund referred to 
the Iqbal decision as a ``judicially heightened pleading 
barrier erected by the Supreme Court.''
    These three witnesses agreed that a legislative response 
like H.R. 4115, the ``Open Access to Courts Act of 2009,'' is 
very necessary.
    In addition to our witnesses, a diverse coalition of 36 
civil rights, consumer, environmental and other organizations 
support a legislative response to
    Ashcroft v. Iqbal.
    Mr. Chairman, I ask that a copy of their letter be included 
in the record following my testimony.
    Mr. Johnson. Without objection.
    Mr. Nadler. Thank you, Mr. Chairman.
    H.R. 4115 would restore the notice pleading standard that 
existed prior to Ashcroft v. Iqbal, a standard that was 
articulated over 50 years ago in Conley v. Gibson. Notice it 
would not establish a brand new standing, opening the 
courthouse doors to all sorts of frivolous claims. It would 
reestablish the pleading standard that existed for 50 years 
prior to Ashcroft.
    Using the language in Conley, the Open Court--Access to 
Courts Act provides that a complaint under Rule 12(b)(6)(c) or 
(e) cannot be denied ``unless it appears beyond doubt that the 
plaintiff can prove no set of facts in support of the claim 
that would entitle the plaintiff to relief.'' That is not 
language that I invented. That is language from the Conley 
decision of roughly 50 years ago.
    That was the correct and workable standard for a half-
century. It is well understood and practical. The Open Access 
to Courts Act would simply restore that time-tested standard.
    Mr. Chairman, this Supreme Court seems to be engaged on a 
crusade to deny access to the courts increasingly to litigants 
of all sorts by tightening and redefining the standing 
standards--and that is a constitutional doctrine we can't 
correct--and by redefining and amending through court ruling 
the rules of civil procedure, a change we can correct and 
should by passing this bill.
    Again, I thank you, Mr. Chairman, for holding today's 
hearing and for your leadership on this issue. I look forward 
to working with you and with the other Members of the 
Subcommittee and the full Committee to restore the rights of 
all Americans to a day in court by enacting H.R. 4115, the 
``Open Access to Courts Act of 2009.''
    Thank you, and I yield back the balance of my time.
    [The prepared statement of Mr. Nadler follows:]
          Prepared Statement of the Honorable Jerrold Nadler, 
        a Representative in Congress from the State of New York

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                               __________

    Mr. Johnson. Thank you, Congressman Nadler.
    And I am pleased to--we will call this hearing, this part 
of the hearing, to a halt, allowing the full ordeal to be over, 
Mr. Congressman.
    And then we will call up our second panel. Thank you.
    And by the way, he is one of the brightest guys in 
Congress, and also long-winded. [Laughter.]
    Okay, this is the second panel of this very important 
hearing. And I want to first start by introducing the people 
who are serving on this Committee, and I also want to thank all 
of you all for serving on this Committee as well.
    The first witness is Professor Eric Schnapper. Professor 
Schnapper is a professor of law at the University of Washington 
School of Law where he is an expert in employment 
discrimination law, equal protection and civil rights.
    He previously worked as assistant counsel at the NAACP 
Legal Defense and Education Fund.
    Welcome, Professor Schnapper.
    The next witness will be Mr. Gregory Katsas. Mr. Katsas was 
the former assistant attorney general for the Civil Division of 
the U.S. Department of Justice. In his work at the U.S. 
Department of Justice, Mr. Katsas argued or supervised most of 
the leading civil appeals brought by the U.S. government 
between 2001 and 2009.
    Mr. Katsas was directly involved in defending Attorney 
General Ashcroft and FBI Director Robert Mueller in the Iqbal 
litigation.
    Welcome, Mr. Katsas.
    Next, we will hear from Jonathan Rubin. Mr. Rubin is a 
partner at Patton Boggs LLP in Washington, DC. He practices all 
facets of antitrust law, including litigation, mergers and 
acquisitions, counsel in compliance and public policy.
    Mr. Rubin is the author of ``Twombly and its Children,'' 
which was recently presented to the American Antitrust 
Institute.
    Welcome, Mr. Rubin.
    And last but certainly not least, we will hear from 
Professor Joshua Davis. Professor Davis is the director of the 
Center for Law and Ethics at the University of San Francisco 
School of Law. He also teaches civil procedure, remedies, legal 
ethics, constitutional theory and First Amendment law.
    I tell you, those law students might hit you for more than 
three or four classes, so I would advise them to be quite nice 
to you, sir.
    And Professor Davis is a member of the advisory board of 
the American Antitrust Institute.
    We want to welcome you to the panel and to this hearing.
    Without objection, your written statements will be placed 
into the record, and we would ask that you limit your oral 
argument--or your oral remarks to 5 minutes.
    You will note that we have a lighting system that starts 
with a green light. At 4 minutes it turns yellow, then red at 5 
minutes. After each witness has presented his or her testimony, 
Subcommittee Members will be permitted to ask questions subject 
to the 5-minute limit.
    Professor Schnapper, will you please proceed with your 
statement, sir?
    Mr. Schnapper. [Off mike.]
    Mr. Johnson. Thank you, Professor. And is that green 
button--okay, it is a green button.
    Mr. Schnapper. Oh, but it is light green. Now it is a dark 
green.
    Mr. Johnson. All right. Okay. All right, thank you.

 TESTIMONY OF ERIC SCHNAPPER, PROFESSOR OF LAW, UNIVERSITY OF 
             WASHINGTON, SCHOOL OF LAW, SEATTLE, WA

    Mr. Schnapper. The decisions in these cases, particularly 
Iqbal, present a serious obstacle to the enforcement of Federal 
laws which forbid actions because they are the result of an 
unlawful purpose.
    Most civil rights cases today involve claims of an unlawful 
but secret motive. Iqbal makes those cases much more difficult 
to pursue. It requires that the plaintiff have enough evidence 
before the lawsuit starts to convince a judge that his or her 
claims are plausible.
    Mr. Coble raised a question--Congressman Coble raised a 
question of whether that might be consistent with laws going 
back many decades. I personally go back many decades, and I----
    Mr. Coble. [Off mike.]
    Mr. Schnapper. I wouldn't have guessed.
    And I can assure you, this is not the legal system on which 
we were practicing for the year--the many years that I have 
been handling these cases in court.
    I have set out in my written statement a number of lower 
court decisions I think correctly describing what the new set 
of standards under Iqbal as new, and I could provide with a 
substantial number of others.
    Congressman Goodlatte expressed the concern--and I think it 
was an entirely legitimate question--about what the 
consequences of this bill would be, and I think it is always 
appropriate for Congress to be concerned about that.
    But the legal regime that the bill would establish is the 
legal regime that has been in place for four decades. We have 
got years of experience with it. And it just hasn't had the 
kind of concerns that have been expressed.
    Mr. Chairman, your point was exactly correct when you noted 
that in civil rights cases it is usually essential to be able 
to have access to discovery in order to prove claims of 
discrimination.
    In most cases, the most telling evidence--sometimes almost 
all the evidence--only comes out in the course of discovery. 
And that is true of employment discrimination cases under Title 
7, the ADA, the Age Discrimination in Employment Act.
    The effect of Iqbal is the equivalent of writing an 
exemption for good liars into the statutes, because if 
defendant does a good job of covering his or her tracks, it is 
going to be very difficult to meet the standard.
    That intent standard isn't limited to employment 
discrimination cases. It also applies to retaliation and 
whistleblower statutes.
    There are many antiretaliation provisions in Federal 
discrimination laws, but it is--they are present in many other 
laws such as Sarbanes-Oxley. And constitutional claims 
involving free speech or equal protection also require proof of 
secret motives.
    What we will be reliably left with as viable claims are 
going to be primarily claims involving fairly inept 
discriminators, people who blurt out their motives or do a very 
bad job of covering their tracks.
    And my brother Mr. Katsas has a list of a number of cases 
which have survived Twombly and Iqbal. I only had a chance to 
look at the list he had in his previous testimony. But they are 
exactly those kinds of cases, discriminatory officials who make 
avowedly discriminatory remarks directly to the plaintiff at 
the time, and those simply aren't typical cases.
    Congressman Coble, you expressed a concern to perhaps defer 
action until the courts themselves were indicating a concern 
about what is happening in the law.
    That concern is out there, and I quote one of those cases 
in my prepared statement from the Ocasio-Hernandez case where 
the judge applies the law as he understands it and dismisses a 
case and then, frankly, says that as the standard he has being 
forced to apply is draconian and that it is requiring proof of 
a smoking gun, and the vast majority of plaintiffs in 
discrimination cases just aren't going to have that.
    There are concerns, and I understand them, that this may 
be--this imposes a burden on plaintiffs--on defendants. I have 
to point out to the Committee that when this same standard has 
been applied to defendants, or when plaintiffs have tried to 
apply the standard to defendants, because defendants have to 
file pleadings too, the defendants have vehemently objected to 
that.
    The standard that defendants have asked be applied to 
defendant pleadings is notice pleading. And I think they are 
right. But I think sauce for the goose should be sauce for the 
gander. But defendants don't like this rule at all when it is 
applied to them, only when it is applied to plaintiffs.
    So there----
    Mr. Johnson. If you could wrap up, please, Professor 
Schnapper. You are almost at the end of your time.
    Mr. Schnapper. I am happy to end here. Thank you, Mr. 
Chairman.
    [The prepared statement of Mr. Schnapper follows:]
                  Prepared Statement of Eric Schnapper

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                               __________

    Mr. Johnson. Thank you, sir.
    And, Mr. Katsas, would you please begin your testimony?

   TESTIMONY OF GREGORY G. KATSAS, FORMER ASSISTANT ATTORNEY 
     GENERAL, CIVIL DIVISION, U.S. DEPARTMENT OF JUSTICE, 
                         WASHINGTON, DC

    Mr. Katsas. Chairman Johnson, Ranking Member Coble, Members 
of the Subcommittee, thank you for the opportunity to testify 
about whether Congress should overrule the Supreme Court's 
recent decisions in Twombly and Iqbal.
    For many reasons, I believe that it should not. As 
explained in my written testimony, Twombly and Iqbal are 
consistent with decades of prior precedent. In essence, those 
cases hold that conclusory and implausible claims should not 
proceed to discovery.
    That conclusion follows from settled principles of black 
letter law that courts, even on a motion to dismiss, are not 
bound to accept conclusory allegations or to draw unreasonable 
inferences from the specific allegations actually made, and 
also that discovery is not appropriate for fishing expeditions. 
Dozens, if not hundreds, of cases support those basic 
propositions.
    Twombly and Iqbal also protect government officials from 
being subjected to baseless litigation and a threat of personal 
liability simply for doing their jobs.
    Those cases reinforce the doctrine of qualified immunity 
which protects government officials from burdensome pretrial 
civil discovery described by the Supreme Court as peculiarly 
disruptive of effective government.
    Such disruption is most apparently where, as in the Iqbal 
case itself, the litigation is conducted against high-ranking 
officials and involves conduct undertaken during a war or other 
national security emergency.
    Imagine the paralyzing effect if any of the thousands of 
detainees currently held abroad by our military could seek 
damages and discovery from the secretary of defense merely by 
alleging in a complaint that the detention was motivated by 
religious animus in which the secretary was complicit.
    That astounding result is exactly what Iqbal forecloses. 
Overruling that decision would, in the words of Second Circuit 
Judge Cabranes, provide a blueprint for terrorists and others 
to sue those government officials called upon to prosecute two 
ongoing wars abroad and to defend the Nation at home.
    In less dramatic contexts as well, Twombly and Iqbal 
prevent--protect defendants from being unfairly subjected to 
the burdens of discovery in cases likely devoid of merit. That 
is no small consideration. Discovery is almost always 
expensive, and electronic discovery costs alone can easily run 
into the millions of dollars in complex cases.
    Defendants cannot recover their discovery costs, even if 
the plaintiff's case turns out to be meritless. So if weak 
cases are routinely allowed to proceed to discovery, defendants 
would have no choice but to settle rather than incur the 
substantial and non-reimbursable discovery costs.
    Twombly and Iqbal have not prevented the pursuit of 
meritorious claims. In fact, according to data compiled by the 
Civil Rules Committee of the Judicial Conference, data that 
encompasses hundreds of thousands of cases filed between 
January 2007 and September 2009, Twombly and Iqbal have had at 
most a negligible impact on how the Federal courts adjudicate 
motions to dismiss.
    Moreover, a 150-page memorandum prepared for the committee 
after exhaustively reviewing dozens of lower court opinions 
that discuss Twombly and Iqbal concluded that overall the case 
law does not appear to indicate a major change in the standards 
used to evaluate complaints.
    Judge Mark Kravitz, who chairs the committee, likewise has 
concluded that courts are taking a nuanced view of Twombly and 
Iqbal and that neither decision has proven to be a blockbuster.
    Individual decisions confirm that, in the words of the 
Seventh Circuit, Twombly and Iqbal preserve a liberal notice 
pleading regime.
    In sum, conclusory and implausible claims have always been 
subject to dismissal on the pleadings. Congress should not 
enact what would be a wrenching departure from that fundamental 
and critically important principle.
    Thank you.
    [The prepared statement of Mr. Katsas follows:]
                Prepared Statement of Gregory G. Katsas

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                               __________
    Mr. Johnson. Thank you, Mr. Katsas.
    I think it is appropriate now, because we are just--you 
just called for votes, is that right? Okay.
    I think it is appropriate, so that Professor Davis would 
not feel abandoned and left out, that he have Mr. Rubin to do 
his statement along with you. And so I think it is good for us 
to break here, go vote. That is going to take, I would say, 40 
minutes--30 to 40 minutes.
    And so if you all could stay with us, we would greatly 
appreciate it. This hearing is now in recess.
    [Recess.]
    Mr. Johnson. Mr. Rubin?

TESTIMONY OF JONATHAN L. RUBIN, PATTON BOGGS, LLP, WASHINGTON, 
                               DC

    Mr. Rubin. Thank you, Mr. Chairman.
    Chairman Johnson, Ranking Member Coble, Members of the 
Subcommittee, thank you for the opportunity to testify today 
about H.R. 4115, the ``Open Access to Courts Act of 2009'' and 
the Supreme Court's recent decisions in Bell Atlantic v. 
Twombly and Ashcroft v. Iqbal.
    My name is Jonathan Rubin, and I am a practicing attorney 
here in Washington, D.C., where I practice antitrust law. I 
have written scholarly articles and given lectures about the 
interpretation and application of the Twombly standard in 
practice.
    I appear today as an individual and not in any capacity 
representing my law firm or any of its clients, so the views I 
express are solely my own.
    Rule 8(a)(2) of the Federal Rules of Civil Procedure 
requires civil pleadings to contain a short and plain statement 
of the claims showing that the pleader is entitled to relief.
    In the 1957 case of Conley v. Gibson, the Supreme Court 
interpreted these words to mean that civil cases should not be 
dismissed unless it appears beyond doubt that the plaintiff can 
prove no set of facts in support of his claim which would 
entitle him to relief.
    Under the Conley standard, courts were directed not to 
dismiss a claim unless it is implausible--that is, unless no 
set of facts could support it.
    In Twombly, the court overruled the Conley no-set-of-facts 
test for what Rule 8 requires, imposing a new, stricter 
interpretation for what constitutes an adequate statement of a 
plaintiff's entitlement to seek relief.
    Civil pleadings must now set forth a particular factual 
narrative supporting liability, and courts must disregard 
conclusory or factually neutral allegations not pleaded in a 
sufficiently suggestive factual context.
    This new and nuanced standard does not affect all 
pleadings, but it does eliminate meritorious claims presented 
in pleadings that allege facts consistent with liability but 
unable to satisfy the stricter requirements of the new 
standard.
    Significantly, the cases that cannot be pleaded to Twombly 
standards are generally those in which the plaintiff lacks 
essential information about the defendant's wrongful acts.
    This is likely to occur in factually complex cases, in 
cases involving abstract economic or financial subject matter, 
and in cases such as a conspiracy or discrimination in which 
the culpable conduct is committed in private or under a cloak 
of secrecy.
    These cases include antitrust conspiracy, fraudulent 
financial schemes, employment discrimination, civil rights 
violations and other substantive areas of the law in which 
private enforcement, in addition to compensating the immediate 
victim of actionable conduct, is particularly useful in 
remediating public wrongs, promoting sound public policy and 
deterring similar wrongdoing by others.
    The principal undesirable effect of the Twombly pleading 
standard, therefore, is to impair the contribution of private 
enforcement to the regulation of business, governmental and 
other conduct affecting the public interest.
    The Twombly standard disproportionately penalizes private 
civil cases most likely to generate positive public 
externality.
    While the investigatory function of private enforcement can 
be restored by enacting legislation designed to reinstate the 
pre-Twombly civil pleading standard, such as the Open Access to 
Courts Act of 2009, capturing the pre-Twombly standard could be 
a challenging legislative task because it rests on a more 
fulsome jurisprudence beyond Conley v. Gibson.
    In my view, Congress should decline to engage directly in 
writing or interpreting the Federal Rules of Civil Procedure. 
As an alternative, the erosion of the investigatory function of 
Federal civil litigation due to Twombly could be mitigated by a 
statutory option granted to a plaintiff in lieu of dismissal 
with prejudice on Twombly grounds to proceed to targeted 
discovery followed by the filing of an amended pleading and 
post-discovery re-review.
    Such proceedings in aid of pleading would substantially 
alleviate the problem of placing a judicial remedy out of the 
reach of cases based on a well-founded suspicion of wrongdoing 
but where the allegations cannot be pleaded to the satisfaction 
of the Twombly plausibility standard.
    At the same time, such an option would retain the 
advantages engendered by Twombly's enhanced and more 
disciplined standards of pleading.
    I thank the Committee for its attention and for the 
opportunity to share my views on this important subject. I have 
submitted a recent paper on Twombly and would ask that it be 
introduced as part of my written statement. And I look forward 
to answering your questions.
    [The prepared statement of Mr. Rubin follows:]
                Prepared Statement of Jonathan L. Rubin

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                               __________
    Mr. Johnson. Thank you, sir.
    And now we will hear from Professor Davis.

  TESTIMONY OF JOSHUA P. DAVIS, PROFESSOR, CENTER FOR LAW AND 
    ETHICS, UNIVERSITY OF SAN FRANCISCO, SCHOOL OF LAW, SAN 
                         FRANCISCO, CA

    Mr. Davis. My name is Josh Davis. I am a professor at the 
University of San Francisco School of Law. My teaching is 
largely in civil procedure and somewhat in complex litigation 
and antitrust law. I have some practical experience there as 
well.
    And I want to thank you sincerely for the honor and the 
privilege of presenting testimony today.
    Twombly and Iqbal do very substantially undermine private 
enforcement of the law generally and private enforcement in 
antitrust in particular. So very briefly, in the time allotted 
to me, I want to make a handful of points.
    I want to emphasize the importance of the antitrust laws. I 
want to emphasize the importance of private enforcement of the 
antitrust laws. And I want to express some concerns about 
Twombly and Iqbal which can be summarized as--that they are an 
attempt to make a change in the law to fix a problem that 
probably doesn't exist, that engendered great cost and 
inefficiency, and gives rise to significant problems of 
political illegitimacy.
    So first, as to the importance of antitrust law, antitrust 
violations are a little bit like steroids in sports. When you 
violate the antitrust laws, cheaters win, consumers lose, and 
honest competitors, including small businesses, are at a 
terrible disadvantage.
    But antitrust law is far more important. And in particular, 
in Exhibit A to my written testimony, I have co-authored an 
article, and that article demonstrates that since 1990 
plaintiffs in private antitrust cases have recovered many 
hundreds of millions of dollars, almost a billion dollars, 
alone from the pharmaceutical industry.
    And in a day and age when everyday citizens are having to 
choose between paying for their medication and buying food or 
paying their rent, that is an issue of the greatest sort.
    Now, as to private enforcement of the antitrust laws, as 
opposed to government enforcement, it is an elegant free market 
solution to a free market problem.
    It is a reflection of American ingenuity, if you will, the 
genius of America, that we would come up with harnessing the 
power of private action in service of the public good.
    And that same study that I did, the written--attached as 
Exhibit A to my written testimony, shows that private 
plaintiffs' lawyers perform two key functions, compensation and 
deterrence.
    As for compensation, cumulatively in just those 40 cases, 
plaintiffs have recovered--plaintiffs' lawyers and plaintiffs 
have recovered over $18 billion as a result of antitrust 
violations.
    Over 5 billion of those dollars come from foreign actors 
who were preying on the American economy. It is important 
compensation that would not occur in the absence of private 
enforcement.
    In a separate article that currently is being drafted, 
attached as Exhibit B to my written testimony, I also, with my 
co-author, established that the deterrence effect of private 
enforcement in those 40 cases alone since 1990 is probably 
significantly greater than the deterrence effect of all of the 
Department of Justice's excellent efforts in criminal 
enforcement. So private antitrust enforcement is absolutely 
crucial.
    Now to my three criticisms, very quickly, of Twombly and 
Iqbal--that they are an attempted solution to a problem that 
probably doesn't exist, expensive and inefficient, and of 
questionable legitimacy.
    First of all, Twombly is premised almost entirely as a 
matter of public policy on the speculation that plaintiffs' 
lawyers may bring cases--plaintiffs may bring cases without any 
significant merit and defendants may settle those cases because 
of the fear of litigation costs.
    The problem with Twombly is it offered absolutely no 
evidence that this is a phenomenon that occurs with any 
significant frequency at all. And indeed, there isn't any 
evidence that I have come across anywhere, and I said that in 
writing. It has been published. It has been out for a couple of 
years. And nobody has responded otherwise. And so I don't think 
there is evidence.
    And it is implausible as a matter of theory once we attend 
to the dynamics of litigation, because the reality is that the 
defendants in these actions are large corporations with 
substantial resources and sophistication.
    They benefit from the delay of litigation. In effect, they 
get an interest-free loan from the plaintiff until they have to 
pay, so that is very valuable to them.
    They also benefit, as do their lawyers, from having a 
reputation of being tough fighters. And then finally, the 
lawyers are paid by the hour, and so protracted litigation is 
very attractive to them. So defendants have every reason to 
fight hard in this litigation, and they do.
    Plaintiffs and plaintiffs' lawyers, on the other hand, have 
reason to settle on reasonable terms and early. They are small 
players. The plaintiffs are giving an interest-free loan to the 
defendants so they can recover. And the plaintiffs' lawyers are 
paid on a purely contingent basis. And so what they want to do 
is settle early, if reasonably.
    In terms of costs, the massive change--and it is a massive 
change that we have seen in the pleading standards--is 
incredibly costly for parties to litigate and for courts to try 
to figure out and apply.
    And then in terms of the political legitimacy issues, first 
of all, the Supreme Court made up facts in Twombly. As I said, 
that is a form of activism just like making value judgments 
that are better delegated to the democratic branches.
    Also--and I would be happy in questions to address this at 
greater length--they didn't follow the protocol in the--set out 
in the Rules Enabling Act.
    And then, as to the judges themselves, they have been 
granted tremendous discretion under these new pleadings 
standards. We have four panelists here, and I think if you 
asked us to define Twombly and the new standard under Twombly 
and Iqbal you would get five opinions.
    And that gives tremendous discretion for judges to indulge 
their ideology rather than to respond to the merits in deciding 
any particular case and determining who gets access to justice.
    And therefore, I encourage you to overrule Twombly and 
Iqbal along the lines of H.R. 4115 or some similar legislation. 
Thank you for your time.
    [The prepared statement of Mr. Davis follows:]
                 Prepared Statement of Joshua P. Davis

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                               __________
    Mr. Johnson. Thank you, Professor Davis. I wish I could 
overrule the Supreme Court decision or decisions in Twombly, 
Iqbal.
    I have got a question I will recognize myself for. And you 
know, this was a judicial animal the way that it was done for 
the last 40 years--I mean, not a judicial animal but a 
legislative animal. Is that correct?
    This standard of the previous standard which was ruled 
unconstitutional--is that standard still--we have had that--let 
me just drop that question and move on.
    This is a case of kind of legislative ruling from the 
bench. Is that right? In other words, taking out legislation 
that Congress enacted and then changing it for no real good 
reason?
    Mr. Davis. Is that to the panel generally, or----
    Mr. Johnson. Yes, generally.
    Mr. Davis. I am happy to take a stab at that. I think that 
Conley is certainly an interpretation of the Federal Rules of 
Civil Procedure and that the judiciary is bound under the Rules 
Enabling Act by the Federal rules.
    And I do think that within certain parameters the judiciary 
has room to interpret those rules. But I actually think that 
Twombly and Iqbal exceed those bounds.
    And just as an example, to make this concrete, part of the 
Federal Rules of Civil Procedure under Rule 84 are the forms. 
And one of the forms is what used to be called Form 9 and is 
now Form 11.
    And what it says--all it says--and this is supposed to be 
absolutely sufficient--according to the Federal rules, for a 
complaint, is it says on a date to be specified, at a place to 
be specified, the defendant negligently drove a motor vehicle 
against the plaintiff.
    Now, that is conclusory. There is no explanation of the 
negligence. And if you take Twombly and Iqbal literally--now, 
the court says that survives, but it doesn't really give a very 
satisfactory explanation as to why.
    If you take Iqbal and Twombly literally, you would say, 
``Well, negligence--that is a conclusion. There is nothing else 
other than the word negligence to say the defendant did 
anything wrong.'' I think there is a very good argument that 
applying Twombly and Iqbal literally--that form is no longer 
good.
    Now, nobody wants to go there, but I think that that is a 
powerful piece of evidence that in Twombly and Iqbal the 
Supreme Court really didn't abide by the framework that was 
enacted pursuant to the Rules Enabling Act and it acted in 
essentially a legislative fashion.
    Mr. Johnson. The legislating from the bench. I am going to 
move on.
    How does Iqbal--how does it affect the ability of a 
litigant to go to court? I want to ask Mr. Katsas that.
    Mr. Katsas. Based on the data we have to date, which 
admittedly cover only a few months, the answer is Iqbal has had 
essentially zero impact on the ability of litigants. The 
federal----
    Mr. Johnson. Well, if I might ask, why is it that previous 
law was changed if this is not having much effect on litigants' 
ability to come into the courthouse and file their pleadings?
    Mr. Katsas. Because previous law wasn't changed, Mr. 
Chairman. Previous law was crystal clear on the propositions I 
mentioned. Conclusory allegations aren't good enough, a 
plaintiff is only entitled to the reasonable inferences from 
the facts pled, discovery is not for fishing expeditions, and 
so on.
    Mr. Johnson. Let me ask Professor Schnapper to respond to 
it, and also Mr. Rubin.
    Mr. Schnapper. Well, with all deference to my colleague, I 
disagree with both that characterization of what the law was 
before and what its impact has been.
    Certainly, you can see any number of cases--and I have 
tried to identify a number of them in my prepared remarks--
which were dismissed under the new standard which wouldn't have 
been dismissed under the old standard and which the judges said 
wouldn't have been dismissed under the old standard.
    So it is clearly--it has clearly had an effect. And as I 
noted earlier, it has had an effect on defendants, because 
judges have been striking affirmative defenses under the Iqbal-
Twombly standard, and that was not something that would have 
happened before.
    Mr. Johnson. Thank you.
    And, Mr. Rubin?
    Mr. Rubin. Thank you, Mr. Chairman. I think that the 
question of legislating from the bench is not a rigorous way of 
looking at it. This is not an unusual situation where the 
Supreme Court interprets, for example, a statute.
    If the interpretation is within the range of the 
interpretations that were envisioned for the statute by 
Congress, then we say the Supreme Court is interpreting. If the 
Supreme Court goes outside of that range, then we say the 
Supreme Court is legislating from the bench.
    In this case, the question is whether or not the Supreme 
Court exceeded in some manner its authority in its more 
granular and more specific interpretation of the pleading 
requirements set down in Rule 8(a)(2).
    Now, I believe that the Supreme Court was probably within 
its rights to interpret the rule as it did. Others may think 
that that is a--such a far-out interpretation that it is 
essentially legislating in the sense that it is changing the 
essential nature of the rule.
    I think that we don't have to decide that question to know 
that there is a change, that the change is very clear in the 
sense that the requirements for expressing entitlement to seek 
relief in a civil complaint have been changed, and it is 
important to see how they have been changed.
    They have been changed in a way that only certain cases are 
going to be affected by the change. And as I tried to point out 
in my statement, there is a class of cases which comes up to 
the edge of the Twombly standard but does not, as the court 
said, go over the line into plausibility, and those cases are 
cases where the plaintiff is in the dark with respect to some 
of the essential ingredients of their claim.
    They can allege facts that are consistent with the claim, 
but they cannot allege facts that get over the line established 
by Twombly. When we are talking about some fix for the problem, 
I believe this is the problem we are talking about, a class of 
cases that will get--which is a minority of cases, or maybe a 
majority, maybe more than 50 percent--I don't know how many 
there.
    But we know that there are cases that are unaffected by the 
Twombly standard because it keeps intact most of the existing 
motion to dismiss standard, but we always--also know that there 
is a class of cases that will be ensnared by Twombly.
    That is the problem to be addressed. Those cases----
    Mr. Johnson. Those pro se----
    Mr. Rubin [continuing]. Did not have a problem before the 
court made its decision. They do have a problem now.
    Mr. Johnson. Pro se cases, cases involving unpopular 
ideas--those cases would be adversely impacted.
    Mr. Katsas. Actually, Mr. Chairman, there is a case called 
Erikson decided between Twombly and Iqbal in which the Supreme 
Court very specifically said that pro se litigants are still 
entitled to the benefit of the doubt in construing their 
complaint, so I don't think that is right.
    Mr. Rubin. Well, if I could address that, Mr. Chairman, I 
think that something that gets lost in this debate is that not 
all cases are created equal. There is a class of cases, such as 
an automobile negligence complaint, which needs only the barest 
allegations in order to make clear what the entitlement of the 
plaintiff to sue is based on.
    Everyone knows that an automobile accident will result--can 
result in injury to people and property. It is not necessary in 
a complaint to allege exactly how the injury was caused and the 
other factual details in order to support and to demonstrate 
the entitlement of the plaintiff to sue.
    And Erikson was also such a case, because in that case the 
essential allegation was that medical treatment was being 
denied a prisoner, and all of us know from our common 
experience that when medical treatment is denied, injury can 
result. We do not need specific factual allegations in order to 
support the entitlement to sue in such a context.
    Contrast that with a--yes, sir.
    Mr. Johnson. So the point that you are making, if you could 
just boil it down----
    Mr. Rubin. Well, is that there is a different kind of case 
that is a complicated case, an economic case, a case of 
discrimination, a case of financial shenanigans, where it is 
not close to our experience what the basis of the entitlement 
to sue is.
    And in those cases, the Twombly standard will come into 
effect. And in those cases, the court is saying, ``We need 
additional factual enhancements in order to make clear the 
entitlement to sue.''
    So you can't say that Twombly is somehow inconsistent with 
Rule--pardon me, with Form 9, which is now Form 11. They are 
two different kinds of case, two different worlds, one to which 
Twombly applies and one to which it doesn't.
    Mr. Davis. Oh, sorry. May I say just a word on this? I 
mean, Mr. Rubin has one theory of Twombly, which is a very 
interesting one, and I could respond on the particulars of that 
issue.
    But I do think the more important point is that 
fundamentally you are right that there is a threat from Twombly 
to the very cases, the very important cases, that you have 
identified. And the reality is that there are lots of ways to 
construe Twombly and Iqbal.
    They have given judges far more room than existed under the 
old system. And so if you get--draw Mr. Rubin as a judge, you 
may get one conclusion. If you draw somebody with a different 
take on Twombly that kind of fits the reasoning in many ways, 
you get a different one.
    And if you get a judge who feels that unpopular views or 
the claims of a pro se litigant are implausible, whatever that 
means based on the good sense of that particular judge, there 
is a very real possibility of dismissal.
    And this is one of the concerns about Twombly and Iqbal, 
that any one of us may come up with our theory of what it--what 
they mean, but there is an awful lot of room that will vary by 
the judge.
    And Mr. Rubin is putting forth one very insightful, well-
reasoned possibility that has to compete with all the others 
that judges may apply in any given case.
    Mr. Johnson. Thank you.
    One last question can be answered a yes, no, maybe so, and 
that is do you think the legislation H.R. 4115 will remedy this 
situation that exists at this time?
    Mr. Schnapper. As drafted, it will remedy it for plaintiffs 
but not for defendants because it only applies to complaints. 
As written, it will not apply to affirmative defenses. It 
wouldn't apply to counterclaims.
    It is unclear if it would apply to a cross complaint. I 
would think it would. But so it works for plaintiffs. It 
doesn't work for defendants.
    Mr. Johnson. Mr. Katsas?
    Mr. Katsas. The legislation would make it impossible for 
any complaint to be dismissed based on either the conclusory or 
implausible nature of the allegations. To that extent, it would 
overrule decades of prior precedent and eliminate any screening 
of complaints on a motion to dismiss.
    Those changes would not simply restore the law to what it 
was immediately before Twombly. It would work very substantial 
and very unwelcome changes in the law.
    Mr. Johnson. Mr. Rubin?
    Mr. Rubin. Well, as I said in my testimony, I would favor a 
less ambitious approach. This legislation would remedy the 
problem we are discussing, but it may also do a lot more and 
have other unintended consequences, which is why I favor a more 
limited approach.
    Mr. Davis. May I----
    Mr. Johnson. Well, what kind of--what kind of things could 
happen as a result of this particular legislation?
    Mr. Rubin. Well, one of the things that it appears that the 
legislation overlooks is the fact that a motion to dismiss is 
a--it is primarily a legal maneuver in order to test the 
illegal sufficiency of the claim as pleaded.
    Not all motions to dismiss go to whether the facts alleged 
are sufficiently informative. Sometimes we are going to--
whether the facts allege--try to state a case that might be 
non-cognizable for other reasons besides a failure of the 
factual allegations--for example, where there is----
    Mr. Johnson. Well----
    Mr. Rubin [continuing]. Immunity or some other legal reason 
not to proceed.
    If the statute says that you can't dismiss because--unless 
no set of facts could support the case, where is the 
demarcation between what we are trying to remedy, which is the 
Twombly problem case--which is where you can allege consistent 
but you can't allege suggestive--and the other range of 
12(b)(6) dismissals, which are an interaction between facts and 
law?
    Because the facts are going to be an input into whether or 
not you have got a legal problem with your claim, whether you 
have got an immunity, whether you have got a Trinko-type 
situation where it is not a cognizable claim because of 
regulation--that sort of thing.
    So that is what I am referring to by the unintended 
consequences of the statute.
    Mr. Johnson. All righty.
    And, Professor Davis, will this legislative proposal remedy 
the state of pleading now so that people are not restricted in 
coming into court?
    Mr. Davis. I think in large measure it would, and let me 
just say three quick things about it. First, I think the gist 
of the bill is to say let's undo Iqbal and Twombly and take us 
back to the position we were in before those very significant 
changes that the Supreme Court effected.
    And so to that extent, I think it absolutely will. It will 
put us back to a system that worked. It wasn't broke. We 
shouldn't have tried to fix it.
    There are two other points I might make. One is it says a 
court shall not dismiss a complaint, and I think that 
consistent with the current language of Rule 8 it might be 
better to say ``shall not dismiss a claim.'' That would deal 
with counterclaims, cross claims, and not just complaints. So I 
think that is a very technical civil procedure sort of point, 
but that would be an improvement.
    And then one might consider more express language saying 
that this doesn't--this just takes us back to the pre-Twombly, 
pre-Iqbal world. One could consider that.
    But I think on the whole it is a very reasonable bill and 
it would solve a lot of the problems that have been created by 
Iqbal and Twombly.
    Mr. Johnson. Thank you.
    And I will now turn it over to the Ranking Member for 
questions.
    Mr. Coble. Thank you, Mr. Chairman.
    And good to have you all with us, gentlemen.
    Mr. Katsas, Judge Mark Kravitz, the chair of the Judicial 
Rules Advisory Committee, recently commented that judges are 
``taking a fairly nuanced view of Iqbal and that Iqbal has not 
thus far proven to be a blockbuster that gets rid of any case 
that is filed.''
    What is your comment on Judge Kravitz's judgment?
    Mr. Katsas. His judgment is supported by a massive array of 
statistics collected by the Judicial Conference and by a 
comprehensive 150-page memorandum prepared for the Judicial 
Conference.
    With respect to the statistics, the Judicial Conference has 
looked at some 800,000 cases between the beginning of 2007 and 
September of 2009. That is about 20,000 cases filed a month. 
They have looked at motions to dismiss--how many are filed, how 
many are granted, in the period before Twombly and compared 
that to the period after Iqbal.
    One can hypothesize all one wants about what some 
particular judge might do, but what the statistics show over 
some 55,000 motions to dismiss is that motions to dismiss prior 
to Twombly were granted at a 38 percent rate in the 4 months 
before Twombly. Motions to dismiss in the 4 months after Iqbal 
were granted at a 38 percent rate as well.
    That is pretty strong initial evidence that Judge Kravitz's 
view that there is no big change here is, in fact, correct.
    Mr. Coble. And I want to ask you another question, Mr. 
Katsas, then I want to hear from the other panelists as well, 
but you first, Mr. Katsas. And you touched on it peripherally.
    Experience in the 6 months since Iqbal was decided provides 
that no basis for believing that the decision will limit access 
to the Federal courts for plaintiffs with legitimate claims as 
defendants continue to lose motions to dismiss complaints even 
when they rely upon Iqbal.
    Do you think that this indicates that the Iqbal decision 
was simply a reiteration of what had already been largely 
prevailing law?
    You first, Mr. Katsas. Then the other gentlemen.
    Mr. Katsas. Yes, I do. The fact that motions to dismiss are 
not being granted at higher rates tends to confirm what is 
quite obvious on the face of Twombly and Iqbal themselves, 
which is that neither decision changes prior law.
    We have heard some suggestion that the court just made up a 
plausibility requirement out of whole cloth. If you look at 
Iqbal, nine justices agreed that there is a plausibility 
requirement, citing Twombly, and disagreed about the particular 
complaint.
    In Twombly, seven justices endorsed plausibility, citing 
the respected treaties of Professor Wright and Miller and the 
numerous cases that I have mentioned.
    So whether you look at pre-Twombly case law or post-Iqbal 
case law, the plaintiffs have a great deal of leeway to pursue 
litigation, but at some point conclusory or implausible claims 
have to be dismissed in order to protect qualified immunity, in 
order to protect defendants from harassment in meritless cases, 
and so on.
    Mr. Coble. I thank you for that.
    And, folks, I am trying to beat my red light, so if you all 
can sum up as quickly as you can.
    Professor, go ahead.
    Mr. Schnapper. Thank you, your Honor--sorry. Just a couple 
of quick points. There are a number of studies which reach the 
opposite conclusion about the effect of this, and I could 
provide copies of those to the staff.
    But having read them, it is my view that none of this 
material is helpful. And the reason is, as Mr. Katsas points 
out, it is about the rate at which motions to dismiss are 
granted. The problem is that motions to dismiss are now made in 
cases they wouldn't have been made before.
    Defendants don't move to dismiss in all cases. They move to 
dismiss in cases that fit the law at the time. And they are now 
moving to dismiss in cases that wouldn't have been dismissed 
before. That is where the problem is, and it is reflected in 
two things.
    First of all, the numbers of dismissals of employment 
discrimination cases is up about a third after Iqbal. The rate 
hasn't changed in all the studies, but the number has gone up.
    Secondly, in one of the cases I have referred to in my 
materials, the Ocasio-Hernandez case, at the end of the case 
the judge points out that until Iqbal--and the judge dismissed 
the case under Iqbal.
    At the end of the case, he points out that before Iqbal the 
defense lawyer, who was a very good lawyer, he said, didn't 
even move to dismiss, because under the law that existed prior 
to Iqbal that wasn't suitable for motion.
    So I think the problem isn't the rates, it is the numbers.
    Mr. Coble. And my red light is on, guys, so if you can--if 
you could sum up as quickly as you can, I would appreciate it.
    Mr. Rubin. Yes, I just would like to--I don't find the 
statistical evidence helpful one way or the other. We simply 
don't know what wasn't filed after Iqbal because of Iqbal, and 
we don't know what really was dismissed because of Iqbal or 
Twombly just because they cite Iqbal or Twombly. So I don't 
find them informative at all.
    Mr. Coble. Thank you.
    Professor?
    Mr. Davis. And just two quick points. One is Arthur Miller, 
the author of the very treatise to which Mr. Katsas cites, has 
described Iqbal and Twombly as a sea change. And the reality is 
it is a radical change from what existed before.
    The other thing on statistics--I would just concur about 
how limited is what we know. If they have the effect that we 
believe, where it is harder to survive a motion to dismiss, you 
would expect more violations of the law because defendants are 
emboldened, because they are unlikely to be held accountable.
    You would expect stronger cases to be filed as plaintiffs 
give up on some of the cases they would have filed before 
because they can't survive a motion to dismiss.
    And then a similar level of either filing of motions to 
dismiss or of granting them wouldn't tell us much, because the 
whole background has changed in light of these rules.
    And until we can figure out how to measure those things, 
the statistics aren't really going to tell us much one way or 
the other. It is a dynamic system, not a static one.
    Mr. Katsas. Could I just make one quick point? We actually 
do know something about the rate of filing of motions to 
dismiss.
    In that same universe of 55,000 cases that I mentioned--
motions to dismiss filed in 34 percent of cases in the 4 months 
before Twombly, 36 percent of cases in the 4 months after 
Iqbal--that does not, to me, sound like a sea change.
    Mr. Coble. Gentlemen, you have been a good panel.
    And I yield back, Mr. Chairman.
    Mr. Johnson. Thank you, sir.
    All right, I will recognize Bob Goodlatte for questions.
    Mr. Goodlatte. Well, thank you, Mr. Chairman.
    I find this debate about the impact that this--these two 
decisions have had to be very interesting. I, quite frankly, 
agree with Mr. Katsas that the evidence does not show a 
significant change, and I think that that in and of itself 
reflects on the fact that these decisions were not a 
significant change in the law.
    In fact, this legislation--and Mr. Nadler in his testimony 
harkened back to the Conley decision, which I don't think has 
ever had a very high standard of credibility in our courts--
there is a long chain of decisions by a host of courts and 
legal scholars and notes in various legal--I have got two pages 
of these things in our memo here on this.
    And it culminated in the comment by Justice Souter in the 
Twombly case, who concluded that the standard that some have 
advocated should be imposed through this legislation in H.R. 
4115, the standard of Conley, had puzzled the profession long 
enough, and it made no sense to employ it any further.
    So quite frankly, Justice Souter--and some have alleged, 
including Mr. Nadler and others, that this is a conservative 
cabal, this is a conservative legislating from the bench. 
Justice Souter is not known by many people on my side of the 
aisle as a conservative justice in any way, shape or form.
    And quite frankly, I think every single member of the court 
recognized that there is a requirement for plausibility.
    So my question for each and every one of you is can you 
actually sit here with a straight face and say that we should 
put into a statute language that says a court shall not dismiss 
a complaint under one of those subdivisions on the basis of a 
determination by the judge that the factual contents of the 
complaint do not show the plaintiff's claim to be plausible?
    In other words, if the plaintiff's claim is implausible, 
that is not a basis for dismissing the case. This, in my 
opinion, would be a radical sea change in the standards that 
are set in our courts, not the other way around.
    So I will start with you, Professor Schnapper, and you are 
welcome to respond to that. But this language is stunning in 
terms of specifically instructing judges in our Federal courts 
to not dismiss cases if they are implausible. How do you defend 
that?
    Mr. Schnapper. Your Honor, let me--I don't want to seem too 
word-smithy about this, but there is some--there is an 
important distinction here between whether the plaintiff, 
without discovery, is able to establish that a complaint is 
plausible, or whether the judge affirmatively concludes it is 
an implausible claim.
    The problem is that the--we are talking about a decision 
that is made before all the evidence is known. And you know, at 
the point--we get to a point where----
    Mr. Goodlatte. So is your standard anything goes? I mean, 
you really like this Conley no-set-of-facts standard that you 
can allege anything and get into court?
    I mean, we talked here about how--in fact, Professor Davis 
cited that one of the reasons why we can argue about the 
statistics is that a lot of people may not have filed cases 
because they couldn't stand up in court. That, to me, is a good 
thing, not a bad thing.
    Why would we waste billions of dollars of resources in our 
country, jamming our courts with cases that shouldn't be in 
those courts, because we specifically tell the courts--the 
Congress specifically tells the courts that if you find a case 
is implausible, you can't dismiss it on that basis?
    Mr. Davis. If I may just--because the word ``plausible,'' 
as so many legal terms do, has--is a term of art. And 
plausibility has been read to require all sorts of things that 
very reasonable plaintiffs are unable to show.
    If you had told me that it was--that Tiger Woods had 
cheated on his spouse, I would have found that not only 
implausible but outrageous. And if his wife had brought suit on 
that basis, she never would have had her day in court, though 
it turned out she was absolutely right.
    The Bernie Madoff scheme--there are many things that happen 
that are implausible. And the way that courts have interpreted 
that word is often to ask plaintiffs not only to establish that 
something may well have happened that gives them every reason 
to believe they have a legal right, but that they at times have 
to allege the who, what, where, how of things they could not 
possibly know or get dismissed.
    And so that is--the word ``plausible'' here----
    Mr. Goodlatte. Well----
    Mr. Davis [continuing]. It is----
    Mr. Goodlatte [continuing]. We don't have divorce cases in 
Federal courts. But in the state of Virginia, you have to 
allege adultery with specificity. You can't just say this 
happened.
    So you know, I understand what you are saying, but I don't 
understand how you could build a standard into the law that 
says the issue of plausibility is off the table in every single 
pleading.
    Mr. Katsas?
    Mr. Katsas. Yes. Think of the black-letter statements of 
motion to dismiss law. A plaintiff is entitled to have the 
truth assumed of well-pleaded factual allegations and all 
reasonable inferences from those allegations.
    A court need not accept unwarranted inferences. All right? 
Those are standard formulations that one sees in all of the 
case law.
    What this bill would do is compel the courts to adopt the 
opposite formulation, which is that a court must accept even 
unwarranted and unreasonable inferences from the facts pled. To 
me, that is just crazy.
    And think about how it would play out on the facts of Iqbal 
itself, right? We are in the wake of an unprecedented national 
security emergency after September 11th. The attorney general 
uses his authority under immigration law to detain people who 
may be connected to the terrorist attacks.
    And one of those guys wants to say, ``Well, I was just 
detained because of my religion and the attorney general was 
not acting to protect the country but to discriminate against 
Muslims. I get to sue the attorney general.'' That seems to me 
crazy. And that is exactly what would be permitted under this 
bill.
    And as Judge Cabranes said in the Second Circuit decision 
in Iqbal, if you allow that case to go forward, you have a 
blueprint--a blueprint--for people to bring baseless, 
politically motivated suits against cabinet officers for doing 
their job and making very tough calls to keep the country safe 
and to exercise all sorts of other--make all sorts of other 
difficult decisions in the performance of their duties.
    That seems to me a floodgate that we should not open.
    Mr. Schnapper. If I could respond a second----
    Mr. Goodlatte. Yes, we took it away from Professor 
Schnapper, and I think we need to let him get back to----
    Mr. Schnapper. Just to respond to the second questions you 
asked, I understand that your view is that the no-set-of-facts 
standard is a bad standard and that that is not what the courts 
were applying prior to Iqbal.
    I took a look in Westlaw for that particular phrase to see 
if it was, in fact, being relied on by the courts prior to 
Iqbal, in the year before Iqbal. The number of cases in which 
it was cited is 1,631. So it was out there.
    Mr. Goodlatte. Yes, but you have to read what those cases 
said, because I have here in front of me--well, I am going to--
here you have a case--no-set-of-facts standard has never been 
taken literally, or unfortunately provided conflicting 
guideposts, or no-set-of-facts language in Conley has never 
been taken literally, or noting that Conley's no-set-of-facts 
language has not been--is not to be taken literally, noting 
that Conley's no-set-of-facts statement if taken literally 
would foolishly protect from challenge complaints alleging that 
only that the defendant wronged the plaintiff or owes plaintiff 
a certain sum, literal compliance with Conley could consist 
simply of giving names of the plaintiff and the defendant and 
asking for judgment.
    I mean, so I don't--you know, we are talking about 
statistics here. I don't think you can simply say that you ran 
a search on no-set-of-facts and found that the courts were 
favorably viewing that as a standard in pleadings cases.
    And let me just close--my time has expired, too--by saying 
that this is an area that is clearly a fine point in the law. 
We want people to be able to get into court, and they are not 
going to be able to allege in their pleadings a full set of 
facts upon which they base their claims because they don't know 
the full set of facts and want to get to discovery.
    But we have to have some kind of standard other than no-
set-of-facts to get into court. Otherwise, we are going to see, 
you know, an explosion of litigation. In this day of the 
preservation of information--e-mails and so on--the amount of 
and the cost of discovery in these cases is staggering.
    And to say that you can get into court on the basis of no-
set-of-facts and then start plowing through and require the 
defendant to plow through and provide documentation when they 
have an infinitely larger amount of data to plow through than 
they ever did in the old environment, where every--where 
whatever was kept was on a piece of paper, is a standard that I 
don't think is an acceptable one for the future.
    I think that we are far better off letting the court deal 
with these nuances than trying to ham-handedly write 
legislation that would actually say into law that a judge 
cannot dismiss a case that he finds to be implausible.
    Thank you, Mr. Chairman.
    Mr. Johnson. Thank you, Mr. Goodlatte.
    And since I took so much time asking questions myself, I 
feel obligated to bestow that same right upon my friends on the 
other side of the aisle.
    Mr. Coble. I am fine, Mr. Chairman.
    Mr. Johnson. All right. All right.
    No further questions. This has been an intriguing hearing. 
And a lot needs to be done to restore--I guess not sanity, but 
to restore the conditions which allowed people to come into 
court with a pleading.
    Now, it may or may not be meritorious. How do you make 
that--how do you make that determination? Is it something that 
you just don't like this claim, and you don't like the party 
who made the claim, and a judge deciding to--well, it is not 
very meritorious?
    I think we have heard the answer to that question. But it 
really does concern me deeply. And this will not be the last 
hearing that we have on this issue.
    I want to appreciate your time and your effort in coming to 
testify today. And I wish everybody happy holidays as well.
    And with that, this hearing is adjourned.
    [Whereupon, at 5:22 p.m., the Subcommittee was adjourned.]
























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