WHEN "PLAUSIBLE" LAW MEANS "imPLAUSIBLE" JUDGMENTS.

The "plausibility" standard determines whether a complaint in Federal Court states a claim upon which relief can be granted.  The results of applying that standard have not received much discussion.  They should receive more attention than they and the "plausibility" standard have gotten.  One of the only known treatments of this topic is in a recent blog post by Dennis J. Wall & Casey Hall, "Changing Plaintiffs' Standard Gives Defendants Cheap Judgments:  Unintended Consequences?" Thomson Reuters Legal Solutions Blog, posted February 24, 2016.

The old notion that somehow "implausible" complaints survived in Federal Courts has been replaced with the present reality that implausible judgments are often -- "regularly" may be nearer the truth of the matter -- given to the other side of the litigation. 

When current judges think that claims are "implausible," the claims are dismissed with prejudice.  Experienced practitioners know that judges generally allow a plaintiff to amend at least once even after the defendant files its answer, but this is not always followed in cases applying the "implausibility" standard of jurisprudence.

Courts enter a final judgment and direct the clerk to close a case each time they dismiss a complaint with prejudice.  This means of course that the plaintiffs have no opportunity thereafter to amend to even try to allege a claim which the given judge sees as more "plausible." 

This procedure is illustrated by the constantly increasing results in an equally increasing number of insurance cases in Federal Courts.  In these cases, defendants raise the filed rate doctrine in motions to dismiss the complaints as "implausible."

The FRD originated in utilities regulation.  There, it is an affirmative defense.  As an affirmative defense, the FRD has required defendants who raise it, to meet their burdens of proof on several elements.

One element which must be proven in utilities cases is that the rate in question was approved by a regulatory agency which was given the statutory power to approve the rate.  The power to approve a rate request involves the power to require a lesser rate.  It also involves the power to require certain documentation and other evidence, among other things.

Another element which must be proven in utilities cases is that the utility filing the rate request is required to address certain issues and submit listed documentation, all of which are identified in applicable statutes and regulations.  In Florida, for example, insurance rate filings are governed both by Statute and by Regulation.  This required element of proof was more fully addressed in previous articles here, here, and here.

In contrast to the law applied in utilities regulation matters, courts faced with insurance and other cases often fail to require any proof that the filed rate doctrine applies at all.  Perhaps the judges simply do not know how to apply the FRD in an insurance case, the doctrine having been imported from utilities regulation.  In any event, this lack of proof does not prevent judges from entering judgments based on the FRD in insurance cases.

The decided cases will be examined here in a forensic investigation never before conducted, so far as is known.  More than that, the results of that forensic examination will be put on display for you to see for yourself.

Please Read The Disclaimer.  ©2016 by Dennis J. Wall, author of Litigation and Prevention of Insurer Bad Faith (3d ed. Thomson Reuters West in 2 Volumes, with  Supplements).  All rights reserved.