Tuesday, January 22, 2013

11th Circuit Reverses Judge King for Misinterpreting Iqbal!

 
Welcome back, plebes!

And thanks to the murderer's row of guest posts the last few days -- I've always depended on the kindness of strangers....

The capacity of Iqbal to wreak havoc in the district courts has long been a bugaboo of this blawg.

In an unpublished opinion, the 11th Circuit has reversed Judge King for dismissing a complaint with prejudice because he found the allegations mere "legal conclusions" entitled to no weight under Iqbal's vague, contour-less pleading standard:
 Lenbro contends the district court erred in refusing to consider the allegations in the Amended Complaint as to the parties’ state of mind on the basis that such allegations were “conclusory” and therefore not entitled to a presumption of truth. Following the Supreme Court’s approach in Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009), the Eleventh Circuit has suggested that, when considering a motion to dismiss, courts: “(1) eliminate any allegations in the complaint that are merely legal conclusions; and (2) where there are well-pleaded factual allegations, assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.” Am. Dental Ass'n v. Cigna Corp., 605 F.3d 1283, 1290 (11th Cir. 2010) (quotations omitted). Allegations entitled to no assumption of truth include “[l]egal conclusions without adequate factual support” or “[f]ormulaic recitations of the elements of a claim.” Mamani v. Berzain, 654 F.3d 1148, 1153 (11th Cir. 2011).

In its Amended Complaint, Lenbro alleged it “insisted that Simon Falic personally guarantee to pay the consulting fees provided for in those agreements and made clear that it would not enter into the Consulting Agreements without such a personal guarantee from Mr. Falic.” This allegation as to the parties’ intent is not a mere legal conclusion, nor is it a formulaic recitation of the elements of a claim. Instead, this allegation is factual, providing support for Lenbro’s contention that the Personal Guaranty and Consulting Agreements were inseparable parts of the same transaction. Therefore, the district court erred in determining these allegations were conclusory, and the allegations should be entitled to a presumption of truth for the purposes of a motion to dismiss.
Well that clears up everything, doesn't it?

4 comments:

Anonymous said...

Welcome back, SFL.

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