Minnesota Supreme Court Rejects Twombly/Iqbal Pleading Standard

Foreclosure Mortgage Servicing Class Action

On August 6, the Minnesota Supreme Court held in a foreclosure-related case that the plausibility standard announced in Twombly and Iqbal does not apply to civil pleadings in Minnesota state court. Walsh v. U.S. Bank, N.A., No. A13-0742, 2014 WL 3844201 (Minn. Aug. 6, 2014). A borrower sued her mortgage lender to vacate the foreclosure sale of her home, claiming the lender failed to properly serve notice of the non-judicial foreclosure proceeding. The bank moved to dismiss the suit based on the plausibility standard established by the U.S. Supreme Court in Twombly, which requires plaintiffs to plead “enough facts to state a claim to relief that is plausible on its face.” The Minnesota Supreme court held that the state’s traditional pleading standard is controlling, and not the federal standard established in Twombly. The court explained that under the state standard, “a claim is sufficient against a motion to dismiss for failure to state a claim if it is possible on any evidence which might be produced, consistent with the pleader’s theory, to grant the relief demanded.” The court identified five reasons the state rule applies: (i) the relevant state rule does not clearly require more factual specificity; (ii) the state’s rules of civil procedure express a strong preference for short statements of facts in complaints; (iii) the sample complaints attached to the rules show that short, general statements are sufficient; (iv) the rules allow parties to move for a more definite statement if a pleading is overly vague; and (v) there are other means to control the costs of discovery.