Procedural Barriers to Court

By Stephen N. Zack, President, American Bar Association. This is the second in a series of posts about the proposed Sunshine in Litigation Act of 2011. Read other posts in a debate about the bill here.

If you were going to change the rules to a game to make them fairer, wouldn’t you ask the referees what they thought?

Unfortunately, Congress has not. They are considering changes to important rules regarding litigation.  Disregarding the longstanding, successful process of court rules-making, however, this bill undercuts the third branch of government, threatens to raise court costs, and may even close off access to justice. All this without accomplishing what it really intends to do.

It’s ironic that something called the “Sunshine in Litigation Act” doesn't involve the judiciary, in order to shed light on the issue. Judges know what problems exist in their courts and are best positioned to solve them. That’s why it is usually a wise, standard procedure to have the third branch of government set rules that address issues in the courts. But this measure avoids what usually works well, and instead would issue a legislative fiat about discovery protective orders. 

If the courts were consulted, it would quickly become clear that the bill language is dangerously unclear and broad. As two Judicial Conference committees write in their letter of opposition to the Senate, Congress’ demands would lead to more confusion, not less, regarding what information has to be released, and when “…The provisions defining the scope of S 623 are problematic,” the conference warns, adding the standard in the law “is so broad and indefinite that it will either sweep up many cases having little to do with public health or safety and impose on all these cases the costly and time-consuming requirements of S. 623, or require the parties and court to spend extensive time and resources litigating whether the statute applies.”

So, what is clear is that each court case falling under the shadow of these new rules would cost every party more time and money.

The U.S. Court of Appeals for the Seventh Circuit ruled earlier this week that a lower federal court judge correctly held that a complaint alleging a conspiracy to fix prices of text message services was plausible enough for litigation to proceed.

Verizon Wireless and other providers of text messaging services, citing the Supreme Court’s decision in Bell Atlantic Corp. v. Twombly, had urged the federal court in Chicago to find that the litigation’s underlying complaints against the wireless communications companies were insufficient and therefore should be dismissed.

Seventh Circuit Judge Richard A. Posner concluded that the “district judge was right to rule that the second amended complaint provides a sufficiently plausible case of price fixing to warrant allowing the plaintiffs to proceed to discovery.”

Although the plaintiffs’ second complaint survived a Twombly challenge, Posner noted that Twombly was “designed to spare defendants the expense of responding to bulky, burdensome discovery unless the complaint provides enough information to enable an inference that the suit has sufficient merit to warrant putting the defendant to the burden of responding to at least a limited discovery demand.”

Twombly and its successor, Ashcroft v. Iqbal, have been criticized by civil rights attorneys, law makers, and legal scholars as creating much more stringent pleading standards than intended by Congress. In its Iqbal decision, the Supreme Court held that for lawsuits to survive motions to dismiss, plaintiffs must provide much more specific factual information. The high court in Iqbal also stated that judges have greater discretion in dismissing complaints before the discovery stage of litigation. The Federal Rules of Civil Procedure created in 1938 had only required that plaintiffs file a complaint including a “short and plain” statement about why they were entitled to relief.

Earlier this year, two civil rights attorneys argued in an ACS Issue Brief that the Supreme Court decisions in Twombly and Iqbal have undermined the “deliberative and inclusive process” that Congress established. For more discussion of the ramifications of Twombly and Iqbal, watch video of an ACS symposium, available here.