Civ Pro 2 Notes 8/27/04

The myth of notice pleading

There’s at least one category of cases that’s handled outside of the rubric of the Federal Rules. Courts have imposed heightened pleading without any Rules-based justification! The Supreme Court has slapped them down twice, in Leatherman and Swierkiewicz! What more could the Court do? Why is there a resilience of heightened pleading in the civil rights context? This has something to do with the pleading burden.

But please note that the Rules aren’t the only place we’ll get heightened pleading requirements. For example, the PSLRA gets Congress directly involved in creating procedural requirements (as opposed to indirectly through the Rules Enabling Act). The statute creates two different burdens: a general particularity requirement, which requires the statement with particularity of all facts that caused people to be mislead, and a requirement to plead with particularity facts that show the defendant acted with a required state of mind. Congress is directly contravening the Federal Rules of Civil Procedure! So they make the plaintiff plead the defendant’s state of mind!

Congress was motivated to do this because they believe securities fraud suits are largely frivolous. They want less of them, and thus they make it more difficult to plead them. There’s another provision that provides for a mandatory discovery stay: once a complaint is challenged with a motion to dismiss based on the statute, the court must stay all discovery, meaning that there is no chance that plaintiffs will be able to get enough information to plead specific facts. But has the PSLRA decreased the number of securities suits? No. Has it increased the quality of the suits? Maybe. But there’s a three way circuit split, and the Supreme Court has twice denied review of the issue.

The same particularity requirement as to intent cropped up in the Y2K Act. Fairman fears that Congress is using this as a technique to discourage certain kinds of lawsuits. So proceduralists are annoyed! The Rules are usually built up from the “grass roots” instead of being imposed from above. Fairman wants Federal Rules that are transsubstantive – that have nothing to do with substantive law. Yeazell thinks that Congress is a better choice for making rules, since Congress does approve all changes to the Federal Rules. But usually they would just accept or reject rules that have gone through the whole Rules Enabling Act process. Fairman has no confidence in Congress’s ability to get procedure right.

So the classic “notice pleading except for fraud” vision is not accurate in practice! But is civil rights an anomaly? No way! There’s heightened pleading in antitrust, RICO, conspiracy, copyright, negligence, and CERCLA, too! These are both statutory and common law causes of action, old and new! This became his second paper. Take antitrust, for example. There are cases in the antitrust areas that will dismiss complaint for “conclusory allegations” or “bare legal conclusions as to the facts”. Every jurisdiction has language like this, but the problem is that many courts use this as a “euphemism” for heightened pleading! There are cases where there are no special pleading requirements for antitrust. Other cases carve out a subset, like antitrust conspiracy claims, and require heightened pleading as to the object and accomplishments of the conspiracy. Fraudulent concealment is dealt with under 9(b) and must meet the particularity requirement. More dramatically, some courts say you must plead “facts with particularity sufficient to support each element of the antitrust action”. This is the infamous “hyperpleading”! Finally, there can be dismissal for prolixity: too many facts! There you have the “pleading circle”.

If you trace back where the courts imposed all these different heightened pleading requirements, they almost always go back to the “germ” of 9(b) and fraud, saying it’s “fraud-like” or arguing that we should treat other substantive areas the same way. So Fairman wants to eliminate 9(b). He proposes leaving “condition of mind”. So that’s the next article! Coming soon!

The Supreme Court has so muddled the substantive law of qualified immunity, circuits like the Fifth Circuit didn’t know what to do. They looked for other ways to protect defendants who they believed were acting properly in their offices.

Pleading burdens

There are three kinds of burdens: pleading burdens – who has to allege the element, production burdens – who must produce the evidence, and persuasion burden – who must persuade the trier of fact. These burdens can be distributed and shifted among different parties. Summary judgment, for example, has a whole bunch of burdens shifting back and forth really fast.

Gomez v. Toledo

This case is going down in Puerto Rico. Gomez is a cop. There’s shady stuff in the police department, and he’s the whistle-blower! He gets moved around, then fired. Factually, Gomez is the good guy and Toledo is the bad guy. Gomez has been wronged, and he’s going to sue! He sues under § 1983 since it’s a government unit that’s doing this to him. He sues based on being denied procedural due process. He didn’t get a hearing where he could prove his innocence. The defendant moves for 12(b)(6) dismissal for failure to state a claim. The basis of the 12(b)(6) is that he claims bad faith must be pleaded since the defendant has qualified immunity. Who has to plead this issue?

§ 1983 deals with deprivation of constitutional rights under color of law. It creates a federal cause of action against government actors, acting under their authority. But along with this, the Supreme Court has imposed the doctrine of qualified immunity, meaning the government actors are off the hook if there was an objectively reasonable belief that the acts were lawful and that the officer acted with the belief that what he was doing was right: both an objective and subjective component. If you have both, you’ll be off the hook. Qualified immunity is always raised by a defense by government actors sued under § 1983. So the battle here is a pleading battle.

Gomez claims that he must simply plead state action, violation of his constitutional rights, and that he was injured. Then, according to Gomez, Toledo may raise his affirmative defense of immunity based on good faith. Toledo, on the other hand, sees things differently: he thinks that the complaint must allege state action, a violation of constitutional rights, and bad faith. The Supreme Court agrees with Gomez. The pleading burden ends up, ultimately, with Toledo, and the Supreme Court agrees with the Gomez view of the world. Thurgood Marshall says bad/good faith is an affirmative defense. Why? It’s basically just the heightened pleading stuff we just talked about! The objective part is easy to plead. But how do you plead the subjective part? How do you plead the defendant acted with any kind of state of mind? How could you sign a complaint under Rule 11 stating the officer’s intent? You’ve got to take a deposition to find this out, and that happens at discovery! In the aftermath, the knowledge of the facts as to good or bad faith lie with Toledo, therefore, the Court puts the pleading burden on Toledo to raise it as an affirmative defense.

Recall Schultea: the Fifth Circuit resurrected heightened pleading for qualified immunity cases using Rule 7. What if we put the two cases together? Gomez files his complaint without qualified immunity in it because the Gomez case says he doesn’t have to. Toledo would file his answer and state his immunity defense (again, under Gomez). Then, under Schultea, Toledo would ask the court to require the plaintiff to reply with particularity, the court will so order, and now Gomez is even worse off! He has to file an answer with particularity, and he’s still in the dark as to subjective intent! It’s beautifully crafted procedure with a horrible result!

Next time, Fairman will tell us why Gomez is wrongly decided.

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