South-Western Legal Studies in Business

Claim of Conspiracy Must Present Plausible Facts to Support Assertion
Description

Supreme Court held that for a claim of a conspiracy in restraint of trade to proceed, the plaintiff must present sufficient evidence which, if believed, could make a case. A naked claim of conspiracy is not sufficient for a trial to occur.

Topic Antitrust
Key Words

Sherman Act; Pleading; Conspiracy; Parallel Behavior

C A S E   S U M M A R Y
Facts

Twombly brought a class action suit on behalf of telephone subscribers, claiming that the regional telephone companies created after the AT&T company was broken up violated the Sherman Act by conspiring not to compete with one another. They engaged in parallel conduct aimed at discouraging new carriers from entering the phone business. The district court dismissed, ruling that the suit contained no direct factual allegations of conspiracy. The appeals court reversed, holding that the suit presented a plausible claim of a conspiracy inferred by defendantsí parallel conduct. Defendants appealed.

Decision

Reversed and remanded. To bring a claim under the Sherman Act requires a complaint with enough factual matter which, if taken as true, would suggest that an agreement was made. An allegation of parallel business conduct and a bare assertion of conspiracy will not alone suffice to state a claim. The assertions made in this case were insufficient to state a claim that could proceed to trial.

Citation

Bell Atlantic Corp. v. Twombly, 127 S.Ct. 1955 (Sup. Ct., 2007)

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