Justice Kennedy’s Civil Procedure Legacy


As we head into the confirmation hearings for Justice Anthony Kennedy’s replacement on the Supreme Court, something of a consensus has formed about his legacy. As Professor Jack Goldsmith succinctly summarized:

Kennedy’s progressive votes on social issues and the death penalty, and his rejection of constitutional originalism, camouflaged the reality that he usually voted with the right side of the Court. He was pro-business, a staunch defender of federalism, … and the Court’s most influential expositor of a libertarian conception of freedom of speech.

Given their political significance, it is no surprise that public focus has been on Justice Kennedy’s views on gay marriage, abortion, and the death penalty. Although he did not often write on civil procedure issues, Justice Kennedy was the author of several important opinions that guide the operation of the civil justice system. His opinions in these cases were pro-business and lined up with “the right side of the Court.”

Justice Kennedy’s civil procedure jurisprudence generally was consistent with Chief Justice John Roberts’s efforts to limit access to the courts. Indeed, Justice Kennedy wrote the Court’s decision in Ashcroft v. Iqbal, in which the Supreme Court employed a higher “plausibility” standard to evaluate a plaintiff’s complaint and stated clearly that this standard applies in all civil cases.

Justice Kennedy also wrote the Court’s opinion in State Farm Mutual Automobile Insurance Co. v. Campbell, in which the Court set guidelines limiting the recovery of punitive damages, and its plurality decision in a personal jurisdiction case, J. McIntyre Machinery v. Nicastro. As I discuss below, both decisions side with the defendant, a business, over the plaintiff, an individual.

Justice Kennedy’s civil procedure decisions were consistent with his jurisprudence in a number of other ways. He tended to decide cases broadly, eschewing the narrow approach taken by a common-law justice such as John Paul Stevens, and he had great faith in the judiciary. Justice Kennedy did not hesitate to give courts the authority, institutionally, to be the decision-maker on the various issues that came before the Court. Finally, his decisions were not always legally compelling.

Ashcroft v. Iqbal: The Supreme Court Holds That the Plausibility Standard for Evaluating the Plaintiff’s Complaint Applies to All Civil Cases

Justice Kennedy’s most important civil procedure decision came in Iqbal. The path to Iqbal begins with the Supreme Court’s decision in Bell Atlantic Corp. v. Twombly, an antitrust case decided in 2007.

Prior to Twombly, the Federal Rules of Civil Procedure set up a system known as notice pleading, in which a plaintiff could start a lawsuit simply by filing “a short and plain statement of the claim.” Notice pleading was an integral part of the original vision for the Rules, which contemplated minimal pleading standards and broad pretrial discovery “to secure,” according to Rule 1, “the just, speedy, and inexpensive determination of every action.”

In Twombly, the Court was asked to determine whether the plaintiffs’ allegations were legally sufficient. The Court held that the plaintiffs’ antitrust claim “requires a complaint with enough factual matter (taken as true) to suggest that an [illegal] agreement was made.” Justice Souter’s opinion for the Court explained that the plaintiffs were required to allege “enough facts to state a claim to relief that is plausible on its face.” The Court concluded that the plaintiffs’ allegations were not sufficient and upheld the district court’s dismissal of the complaint.

Twombly required more than “a short and plain statement” of the plaintiff’s claim and inspired debate over its scope. Did the plausibility standard apply only to antitrust cases? Or did Twombly apply more broadly? In a 5–4 decision written by Justice Kennedy, the Court adopted the latter position in Iqbal in 2009.

Iqbal reiterated the plausibility language from Twombly, with this elaboration by Justice Kennedy: “Determining whether a complaint states a plausible claim” is a “context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” And “[w]here the well-pleaded facts do not permit the court to infer more than the possibility of misconduct,” he stated, the complaint should be dismissed.

The Court adopted the plausibility standard because of its concern about the time and expenses associated with civil litigation. By requiring a plaintiff to satisfy the plausibility standard at the outset, the Court reasoned, district court judges could sort meritorious cases from frivolous ones without subjecting defendants to the burden of litigation.

Iqbal was a broad, even sweeping, decision. The Court made clear that Twombly’s plausibility standard applies in all civil cases. The breadth of the decision engendered substantial criticism. Among other things, critics noted that Justice Souter, who wrote the majority decision in Twombly, dissented in Iqbal, suggesting that the Court’s holding in the former case should have been limited to antitrust cases.

Iqbal has been vigorously criticized as part of the Roberts Court’s campaign to restrict access to the courts. An empirical study published in 2015 by Professor Alex Reinert, who argued on behalf of the losing plaintiff-respondent in Iqbal, concluded that there have been “concrete costs” associated with its heightened pleading regime: “Important categories of cases are experiencing increased dismissal rates” and “[i]ndividuals are faring far worse than corporate and governmental litigants.”

Furthermore, Professor Reinert observed, “plausibility pleading is not paying dividends; it is not resulting in higher quality lawsuits.” Ultimately he concluded that “[t]he current pleading regime has brought increased inequality, reduced access to justice, and provided little measurable benefit.”

It must be noted that other studies of cases decided after Iqbal have concluded that it has not had a significant effect. If Professor Reinert’s conclusions are correct, however, then Justice Kennedy’s decision has restricted access to the courts and, in certain cases, re-balanced the scales to favor defendants.

Finally, as noted earlier, Justice Kennedy instructed reviewing courts to draw on “judicial experience and common sense” when evaluating a complaint. This approach empowers, indeed commands, the trial court judge to apply her own views in determining whether to dismiss the case rather than allowing it to proceed. This instruction is quintessential Kennedy. It shows his confidence in the judiciary’s ability to reach the right decision and to be trusted to do so.

J. McIntyre Machinery v. Nicastro: A More Restrictive Approach to Personal Jurisdiction in a Personal Injury Case

Iqbal has been criticized for being pro-defendant. So too has Justice Kennedy’s opinion in Nicastro, in which the plurality held that a New Jersey court could not hear a case filed against a British manufacturer by a man who was injured in New Jersey while using one of its machines. The Court reasoned that the British manufacturer sold the machine into the United States through a distributor that made only a few sales in New Jersey. The Court held that the foreign manufacturer did not specifically avail itself of the New Jersey market and therefore could not be sued in a New Jersey court.

Nicastro is revealing for a number of reasons. First, it was a pro-defendant decision in a personal injury case. J. McIntyre Machinery employed a distributor to sell its machines in the United States, including New Jersey. Yet the company could not be sued in a New Jersey court because its distributor did not make many sales in that State. Mr. Nicastro would have to go to the United Kingdom to sue J. McIntyre—even though common sense would suggest that a company has more resources than an individual to absorb the costs of litigation.

Second, as Justice Ruth Bader Ginsburg argued in a powerful dissent, Justice Kennedy’s decision was contrary to the Court’s foundational decision in this area, International Shoe Corp. v. Washington. In that case, decided in 1945, the Court adopted a practical approach to personal jurisdiction, reasoning that the combination of technological progress and commerce rendered state boundaries less legally significant.

The impetus of International Shoe is that a company doing business across state (or international) lines should be held accountable where its product has been sold and causes an injury to someone—even, Justice Ginsburg argued, if there have been only a few sales in the forum state. Justice Kennedy’s disregard of the well-settled principles of International Shoe exasperated his critics.

Third, because his decision apparently was too broad, Justice Kennedy could not get four more justices to sign off on his reasoning in the case. Only three other justices—all of them conservatives (Roberts, Antonin Scalia, and Clarence Thomas)—voted with Kennedy. Justices Stephen Breyer and Samuel Alito agreed that the New Jersey court did not have personal jurisdiction but thought the case should be decided narrowly and limited to its specific facts. Justice Ginsburg, joined by Justices Sonia Sotomayor and Elena Kagan, dissented.

State Farm Mutual Automobile Insurance Co. v. Campbell: Ratios to Guide Judicial Review of Punitive Damages Awards

In State Farm, the Supreme Court vacated a jury’s punitive damages award of $145 million as excessive in violation of the Due Process Clause. In limiting the punitive damages that could be awarded against an insurance company for tort claims, including fraud, the decision obviously was a pro-business one.

In interpreting the Due Process Clause to establish a ratio of permissible punitive damages to compensatory damages no greater than a “single-digit multiplier,” Justice Kennedy shifted decision-making authority from the jury to the judge(s) reviewing the punitive damages award in a case. If Iqbal and Nicastro were sweeping in their breadth, State Farm was notable for its legislation-like specificity.

State Farm drew criticism from both wings of the Court. Justices Scalia and Thomas, the Court’s conservative originalists, dissented because the text of the Constitution does not prohibit excessive punitive damage awards. Justice Ginsburg dissented on the grounds that the Court generally should not “impose a federal check on state-court judgments awarding punitive damages.” (State Farm is one case in which Justice Kennedy’s pro-business tendencies trumped his support for federalism.)

In sum, all three cases show that while Justice Kennedy did not write many civil procedure opinions, he nonetheless exercised significant influence in this area of the law. In each case, consistent with his conservative approach, this influence was pro-business.

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