Bell Atlantic Corp. v. Twombly
Citation: 550 U.S. 544 (U.S. Supreme Court, 2007)
Facts
Plaintiffs brought a class action antitrust suit against major telecommunications companies, alleging they had engaged in parallel conduct to restrain competition in their respective regional markets and had agreed not to compete with one another. The complaint relied heavily on allegations of parallel business behavior. The district court dismissed the complaint for failure to state a claim, and the Second Circuit reversed.
Issue
Whether an antitrust complaint survives a motion to dismiss under Rule 12(b)(6) when it alleges parallel conduct without factual allegations sufficient to raise a plausible inference of a conspiracy.
Holding
The Supreme Court affirmed the dismissal, holding that the complaint failed to allege sufficient facts to plausibly suggest an agreement among the defendants, and that parallel conduct alone was insufficient to state a claim under the Sherman Act.
Rule
A complaint must allege enough facts to state a claim for relief that is plausible on its face. Mere conclusory allegations or a formulaic recitation of the elements of a cause of action are insufficient. This replaced the older “no set of facts” standard from Conley v. Gibson.
Significance
Twombly fundamentally restructured federal pleading standards by introducing the plausibility standard, replacing the permissive Conley v. Gibson standard that had governed for fifty years. It is the foundational case for understanding modern 12(b)(6) practice and is almost always paired with Ashcroft v. Iqbal.