April 5, 2012

Second Circuit Adds to Post-Twombly Antitrust Pleading Jurisprudence

Summary: In the latest case to apply the developing pleading standards in antitrust cases, the United States Court of Appeals for the Second Circuit yesterday, in Anderson News, L.L.C. v. Am. Media, Inc., unanimously vacated and remanded a suit based on allegations under Section 1 of the Sherman Act that had been dismissed, without leave to amend, by the United States District Court for the Southern District of New York. The Court held that the proposed amended complaint proffered by the plaintiffs in connection with their motion for reconsideration in the Southern District stated a claim on which relief could be granted, applying the standards set forth by the U.S. Supreme Court in Bell Atlantic Corp. v. Twombly, (“Twombly”) and Ashcroft v. Iqbal.

Early post-Twombly decisions appeared to greatly heighten antitrust conspiracy pleading requirements, but this case seems to be a further indication that, while the standards may be higher than pre-Twombly, a plaintiff need not show that the alleged conspiracy is probable in order to show that it is plausible. Moreover, unlike the level of analysis they are obliged to apply at the summary judgment stage, District Courts may not at the motion to dismiss stage decide whether alternative theories of lawful conduct are more or less plausible than the pleaded theory.

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