Menda K. Warne, Petitioner
Bill J. Hall, Respondent
Certiorari to the Colorado Court of Appeals. Court of Appeals
Case No. 12CA719.
Judgment Reversed in Part and Affirmed in Part.
petitioned for review of the court of appeals' judgment
reversing the dismissal of Hall's complaint, which
asserted a claim of intentional interference with contract.
Although invited to apply the standard for dismissal
articulated in Bell Atlantic Corp. v. Twombly, 550
U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), and
Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173
L.Ed.2d 868 (2009), the district court dismissed for failure
to state a claim upon which relief could be granted without
addressing either Twombly or Iqbal in its written order. By
contrast, the court of appeals expressly declined to apply
the more recent United States Supreme Court jurisprudence
governing Fed.R.Civ.P. 12(b)(6), finding itself instead bound
by the Colorado Supreme Court's existing precedent, which
had heavily relied on the United States Supreme Court's
earlier opinion in Conley v. Gibson, 355 U.S. 41, 78
S.Ct. 99, 2 L.Ed.2d 80 (1957), and particularly its language
to the effect that a complaint should not be dismissed for
failure to state a claim unless it appears beyond doubt that
the plaintiff can prove " no set of facts" in
support of his claim. Declining, therefore, to be influenced
by the United States Supreme Court's more recent
admonition to the federal courts that " a complaint must
contain sufficient factual matter, accepted as true, to
'state a claim for relief that is plausible on its
face,'" Iqbal, 556 U.S. at 678 (quoting Twombly, 550
U.S. at 570), the court of appeals found the complaint
sufficient to state a claim.
Colorado Supreme Court reversed the judgment of the court of
appeals finding the complaint to be sufficient. Because the
Colorado Supreme Court's case law interpreting the
Colorado Rules of Civil Procedure in general, and C.R.C.P. 8
and 12(b)(5) in particular, reflected first and foremost a
preference to maintain uniformity in the interpretation of
the federal and state rules of civil procedure and a
willingness to be guided by the United States Supreme
Court's interpretation of corresponding federal rules
whenever possible, rather than an intent to adhere to a
particular federal interpretation prevalent at some fixed
point in the past, the Colorado Supreme Court found that its
precedent was interpreted too narrowly by the court of
appeals. Because it also found that the plaintiff's
complaint, when evaluated in light of the more recent and
nuanced analysis of Twombly and Iqbal, failed to state a
plausible claim for relief, the Colorado Supreme Court found
the complaint insufficient under the Colorado Rules of Civil
Petitioner: Vaughn & DeMuro, Gordon L. Vaughan, David R.
DeMuro, Colorado Springs, Colorado.
Respondent: Clark Williams and Matsunaka, LLC, Roger E.
Clark, Loveland, Colorado.
Amicus Curiae Colorado Civil Justice League: Davis Graham &
Stubbs LLP, Jordan Lipp, Geoffrey C. Klingsporn, Denver,
Colorado; Wheeler Trigg O'Donnell LLP, Terence Ridley,
Evan Stephenson, Thomas Werge, Denver, Colorado.
Amicus Curiae Colorado Defense Lawyers Association: Jaudon &
Avery LLP, Jared R. Ellis, Denver, Colorado.
Amicus Curiae Colorado Plaintiff Employment Lawyers
Association: Lowrey Parady, LLC, Sarah J. Parady Denver,
Amici Curiae The State of Colorado and Colorado
Intergovernmental Risk Sharing Agency (CIRSA): Cynthia H.
Coffman, Attorney General, Daniel D. Domenico, Solicitor
General, Frederick R. Yarger, Assistant Solicitor General,
Kathleen L. Spalding, Senior Assistant Attorney General,
Matthew D. Grove, Assistant Solicitor General, Denver,
Colorado; Colorado Intergovernmental Risk Sharing Agency
(CIRSA), Tami A. Tanoue, General Counsel, Denver, Colorado.
Amicus Curiae The Colorado Trial Lawyers Association:
Leventhal & Puga, P.C., Benjamin Sachs, David Mason Denver,
Colorado; Holland, Holland Edwards & Grossman, PC, John R.
Holland, Denver, Colorado.
COATS delivered the Opinion of the Court. JUSTICE GABRIEL
dissents, and JUSTICE MÁRQUEZ and JUSTICE HOOD join in the
[¶1] Warne petitioned for review of the
court of appeals' judgment reversing the dismissal of
Hall's complaint, which asserted, as relevant here, a
claim of intentional interference with contract. See Hall
v. Warne, No. 12CA719 (Colo.App. Jan. 23, 2014) (not
published pursuant to C.A.R. 35(f)). Although invited to
apply the standard for dismissal articulated in Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955,
167 L.Ed.2d 929 (2007), and Ashcroft v. Iqbal, 556
U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009), the
district court dismissed for failure to state a claim upon
which relief could be granted without addressing either
Twombly or Iqbal in its written order. By contrast, the court
of appeals expressly declined to apply the more recent United
States Supreme Court jurisprudence governing Fed.R.Civ.P.
12(b)(6), finding itself instead bound by this court's
existing precedent, which has heavily relied on the Supreme
Court's earlier opinion in Conley v. Gibson, 355
U.S. 41, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957), and particularly
its language to the effect that a complaint should not be
dismissed for failure to state a claim unless it appears
beyond doubt that the plaintiff can prove " no set of
facts" in support of his claim. Declining, therefore, to
be influenced by the United States Supreme Court's more
recent admonition to the federal courts that " a
complaint must contain sufficient factual matter, accepted as
true, to 'state a claim for relief that is plausible on
its face,'" Iqbal, 556 U.S. at 678 (quoting
Twombly, 550 U.S. at 570), the court of appeals
found the complaint sufficient to state a claim.
[¶2] Because our case law interpreting the
Colorado Rules of Civil Procedure in general, and C.R.C.P. 8
and 12(b)(5) in particular, reflects first and foremost a
preference to maintain uniformity in the interpretation of
the federal and state rules of civil procedure and a
willingness to be guided by the Supreme Court's
interpretation of corresponding federal rules whenever
possible, rather than an intent to adhere to a particular
federal interpretation prevalent at some fixed point in the
past, the court of appeals too narrowly understood our
existing precedent. Because the plaintiff's complaint,
when evaluated in light of the more recent and nuanced
analysis of Twombly and Iqbal, fails to state a plausible
claim for relief, the judgment of the court of appeals
finding the complaint to be sufficient is reversed, and the
matter is remanded with instruction to permit further
proceedings consistent with this opinion.
[¶3] Bill Hall filed a complaint in state
district court against the Town of Gilcrest and its mayor,
Menda Warne, as an individual. Hall's complaint alleged
that Warne used her authority as mayor to interfere with his
purchase agreement to sell a parcel of land in Gilcrest to
Ensign United States Drilling, Inc., which intended,
according to an attachment to the complaint, to build its
headquarters on the property. Although the precise terms of
the agreement were not included in the pleadings, the
complaint, along with its attached exhibits, indicated that
Ensign tried for more than a year to obtain approval to
purchase the property and construct its headquarters in
Gilcrest, but its efforts were thwarted by the town
government. More specifically, the complaint alleged that
Warne caused Ensign to terminate the agreement by imposing
unauthorized and unreasonable conditions on its proposed site
development plan, by mayoral order, after the plan had been
conditionally approved by the town board at a public hearing.
The complaint further alleged that Warne's actions were
motivated by malice towards Hall and that the conditions
imposed on Ensign's plans were " disproportionate to
any impact Ensign would have on the town" and "
were not based on the reasonable requirements of applicable
ordinances or law." On the basis of these and similar
allegations, the complaint asserted several claims for relief
under state and federal law, including intentional
interference with contractual obligations, taking without
just compensation, and violation of substantive due process
under 28 U.S.C. § 1983 (2012).
[¶4] Because the original complaint included
both state and federal claims, the case was removed to
federal district court pursuant to 28 U.S.C. § 1441
(2012). Upon removal, Warne and the town filed a motion to
dismiss for failure to state a claim for relief under
Fed.R.Civ.P. 12(b)(6). Before briefing was complete, the
federal district court accepted a stipulation by the parties
whereby the federal law claims would be voluntarily dismissed
by Hall and the case would be remanded to state district
court for resolution of the state law claim for intentional
interference with contractual obligations against Warne.
[¶5] On remand to the state district court,
the motion to dismiss under Fed.R.Civ.P. 12(b)(6) was
converted into a motion to dismiss under the corresponding,
though differently-numbered state rule, C.R.C.P. 12(b)(5). In
subsequent briefing, Warne and the town urged the district
court to review the motion to dismiss according to the "
plausible on its face" standard recently articulated by
the United States Supreme Court in Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929
(2007), and Ashcroft v. Iqbal, 556 U.S. 662, 129
S.Ct. 1937, 173 L.Ed.2d 868 (2009), rather than the so-called
" no set of facts" standard from Conley v.
Gibson, 355 U.S. 41, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957),
cited favorably by this court in the past. Without expressly
distinguishing the Conley from the Twombly/Iqbal standard of
review, the district court granted the defendants' motion
to dismiss, finding that the complaint contained insufficient
allegations that Warne in fact caused the conditions to be
imposed on Ensign's proposed development plan that
ultimately led Ensign to terminate its contract with Hall.
[¶6] The plaintiff was granted leave to file
an amended complaint, which he did, to include additional
allegations that he had been informed that Warne exercised
control over land development matters and would have used any
means at her disposal to ensure that Ensign would never meet
the requirements necessary to build, regardless of what had
been approved by the town board. The defendants renewed their
motion to dismiss for failure to state a claim, which the
district court again granted, finding that while the amended
complaint provided additional allegations supporting a
conclusion that Warne possessed the authority and intent to
block Ensign's development plan, it lacked allegations of
Warne's specific conduct causing Ensign's breach.
Subsequently, the district court also awarded attorney fees
in favor of the defendants.
[¶7] On Hall's appeal of the dismissal
of his claim for contractual interference, the court of
appeals reversed, finding itself bound by this court's
precedent relying on Conley's " no set of
facts" standard and, therefore, rejecting Warne's
proposal to examine the complaint under the Twombly/Iqbal
" plausible on its face" standard. Under the Conley
standard, the court of appeals concluded that the complaint
sufficed to state a claim for relief and, more specifically,
that Hall's allegations to the effect that Warne
possessed the authority and intent to block Ensign's
development plan and that she had exercised that authority to
impose conditions despite the town board's prior approval
of Ensign's plan sufficiently pled that Warne caused
Ensign to terminate its contract with Hall. The court of
appeals therefore also reversed the district court's
award of attorney fees.
[¶8] Warne petitioned this court for further
review by writ of certiorari.
[¶9] in Bell Atlantic Corp. v.
Twombly, in addressing the proper standard for pleading
an antitrust conspiracy through allegations of parallel
conduct, the United States Supreme Court explicated the
pleading standard of Federal Rule of Civil Procedure 8 in
greater detail than it had done in at least a half-century,
giving particular emphasis to the " plaintiff's
obligation to provide the 'grounds' of his
'entitle[ment] to relief.'" 550 U.S. 544, 555,
127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (quoting Fed.R.Civ.P.
8(a)(2)). In that context, the Court stated that the factual
allegations of the complaint must be enough to raise a right
to relief " above the speculative level," id., and
provide " plausible grounds to infer an agreement,"
id. at 556. Had there been any doubt, two years later, in
Ashcroft v. Iqbal, the Court made clear that Twombly's
" plausibility standard" was in no way limited to
the antitrust conspiracy context in which it had been
articulated, but rather represented a " construction of
Rule 8," Iqbal, 556 U.S. 662, 678-80, 129 S.Ct.
1937, 173 L.Ed.2d 868 (2009), which governs the pleading
standard " in all civil actions and proceedings in the
United States district courts," id. at 684. Quoting
liberally from its earlier opinion in Twombly, the Court in
Iqbal characterized that standard as being underlain by two
working principles: First, " the tenet that a court must
accept as true all of the allegations contained in a
complaint is inapplicable to legal conclusions," id. at
678, and second, " only a complaint that states a
plausible claim for relief survives a motion to
dismiss," id. at 679.
[¶10] The Court derived its "
plausibility standard" from Rule 8 as it then existed,
without feeling compelled to either amend the language of the
rule or overturn any of the Court's prior
interpretations, Twombly, 550 U.S. at 569 n.14, instead
characterizing the Twombly plaintiffs' main argument
against this interpretation as its " ostensible
conflict" with an isolated statement in the Court's
earlier construction in Conley v. Gibson, 355 U.S.
41, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957), Twombly, 550 U.S. at
560-61. As the Court explained, when it spoke (some fifty
years earlier in Conley) not only of the need for fair notice
of the grounds for entitlement to relief, but also of "
the accepted rule that a complaint should not be dismissed
for failure to state a claim unless it appears beyond doubt
that the plaintiff can prove no set of facts in support of
his claim which would entitle him to relief," id. at 561
(quoting Conley, 355 U.S. at 45-46), the "
accepted rule" to which it referred was a rule that
" once a claim has been stated adequately, it may be
supported by showing any set of facts consistent with the
allegations in the complaint," id. at 563. While the
Court openly conceded that the " no set of facts"
passage of Conley could be read in isolation as saying that
any statement revealing the theory of the claim would suffice
unless its factual impossibility could be shown from the face
of the pleadings, and that many courts had understood it
precisely that way, id. at 561, in context, Conley "
described the breadth of opportunity to prove what an
adequate complaint claims, not the minimum standard of
adequate pleading to govern a complaint's survival,"
id. at 563.
[¶11] Like many federal courts and other
state courts, this court took Conley's " no set of
facts" language, at least ostensibly, at face value. As
the court of appeals rightly noted, this court has a long,
and continuous, tradition of repeating, in reliance on
Conley, that motions for dismissal are looked upon with
disfavor and will be granted only if it appears beyond doubt
that the plaintiff can prove no set of facts in support of a
claim that would entitle the plaintiff to relief. See,
e.g., Qwest Corp. v. Colo. Div. of Prop. Taxation,
2013 CO 39, ¶ 12, 304 P.3d 217, 221; Sprott v.
Roberts, 154 Colo. 252, 390 P.2d 465, 467 (Colo. 1964)
(quoting Conley's " no set of facts" passage
for the first time in a concurring opinion, while noting that
" [t]his expresses the recognized way to test the
sufficiency of a claim, and it has been applied in a legion
of cases in the lower federal courts" ). In fact, our
reliance on the federal courts for our interpretation of the
pleading standards of our own Rule 8 can be traced back even
before Conley, virtually to the initial replacement of our
former Code of Civil Procedure by the modern Rules of Civil
Procedure. See People ex rel. Bauer v. McCloskey,
112 Colo. 488, 150 P.2d 861, 863 (Colo. 1944) (citing
Eberle v. Sinclair Prairie Oil Co., 35 F.Supp. 296,
297 (E.D. Okla. 1940), aff'd, 120 F.2d 746 (10th Cir.
1941); Sparks v. England, 113 F.2d 579, 582 (8th
Cir. 1940); Leimer v. State Mut. Life Assurance Co. of
Worcester, Mass., 108 F.2d 302, 306 (8th Cir. 1940)
(subsequently relied on by Conley, 355 U.S. at 45-46 n.5, for
its characterization of the " accepted rule" )).
[¶12] The question before us today is
therefore less one of whether we will abandon the Conley
pleading standard in favor of the Twombly/Iqbal standard than
whether our pleading standard has always represented an
attempt to mirror the accepted federal construction of the
virtually identical federal pleading rules, rather than to
adopt the particular interpretation of the corresponding
federal rule that was prevalent at the time. For a number of
reasons, in the absence of some compelling justification
unique to the history or practice of this jurisdiction, we
have always considered it preferable to interpret our own
rules of civil procedure harmoniously with our understanding
of similarly worded federal rules of practice. See
Leaffer v. Zarlengo, 44 P.3d 1072, 1080 (Colo. 2002)
(federal cases interpreting federal rules provide "
highly persuasive guidance" when interpreting identical
state rules); Faris v. Rothenberg, 648 P.2d 1089,
1091 n.1 (Colo. 1982). We see no reason to abandon that
philosophy or approach today.
[¶13] As a general matter, except as
required by the Supremacy Clause of the Federal Constitution,
we are clearly not bound to accept the United States Supreme
Court's understanding of language susceptible of more
than one reasonable interpretation, and for various reasons
we have, on occasion, deviated in our construction of
similarly worded constitutional provisions, statutes, and
rules. However, quite apart from the fact that a considered
interpretation by the Supreme Court, applying rules of
construction equally acceptable in this jurisdiction, will
virtually always be worthy of serious consideration, as we
have previously observed, simply disagreeing with the Supreme
Court about the meaning of the same or similar provisions
appearing in both federal and state law risks undermining
confidence in the judicial process and the objective
interpretation of codified law. See Curious Theatre Co.
v. Colo. Dep't of Pub. Health & Env't, 220 P.3d
544, 551 (Colo. 2009). This concern is only heightened when
the disagreement in question reflects our resistance to the
Supreme Court's determination that our understanding of
one of its prior pronouncements has in fact been mistaken.
Cf. Ingold v. AIMCO/Bluffs, L.L.C. Apartments, 159
P.3d 116, 123-25 (Colo. 2007) (overturning prior decision
relying on federal caselaw subsequently repudiated by the
United States Supreme Court).
[¶14] In light of our unequivocal statements
of attribution in the past, we think it disingenuous to
suggest that our understanding of the pleading requirements
of our own rules was not directly borrowed from the
prevailing interpretation of the corresponding federal rules,
by both the lower federal courts and ultimately the Supreme
Court itself. Of course, were we to conclude that our
reliance on this federal interpretation had become so much a
part of the fabric of state practice that the benefit of
retaining it unaltered would outweigh the benefits of
harmonizing the construction of identical federal and state
rules of civil procedure, we could avoid the tension created
by disparate interpretations of identical rules by simply
amending our rule to expressly codify a " no set of
facts" standard. We do not, however, find that to be the
[¶15] The desirability and importance of
procedural uniformity in our unique, federal form of
government has been a critical factor not only in the
development of federal rules capable of serving as a model
for the states, but also for our own decision to adopt a
version of the federal rules and construe them accordingly.
It cannot seriously be disputed that the Colorado Rules of
Civil Procedure were modeled almost entirely after the
corresponding federal rules, with the principal goal of
establishing uniformity between state and federal judicial
proceedings in this jurisdiction. See C.R.C.P. app. D at 427,
Colo. Stat. Ann. vol. 1 (Supp. 1941) (" With the hope
that procedure might be adopted in Colorado following as far
as practicable the new federal rules, so that a Colorado
lawyer would be equally at home in the courts of the United
States and those of Colorado, the Colorado Bar Association in
September, 1938, authorized the appointment of a Committee to
effectuate that reform." ); see also Thomas Keely, How
Colorado Conformed State to Federal Civil Procedure, 16
F.R.D. 291 (1954) (authored by the Chairman of the Colorado
Supreme Court Rules Committee).
[¶16] Far from a novel concept, the
prevailing policy in this country has been to favor
procedural uniformity between state and federal court
practice virtually since the founding of our Union. Beginning
with its adoption of the so-called " Conformity
Act" in 1789, Congress required lower federal courts to
largely apply the procedural law of the state in which they
were located. Act of Sept. 29, 1789, ch. 21, § 2, 1
Stat. 93, 93; see also 4 Charles Alan Wright & Arthur R.
Miller, Federal Practice & Procedure § 1002 (3d ed.
2002) (titled, " History of Federal Procedure Under
Statute" ). While the Conformity Act's localized
approach to federal procedure ultimately proved problematic,
it was replaced by the Federal Rules of Civil Procedure,
which were intended to facilitate state-federal uniformity by
serving as a singular, authoritative model for states to
follow. See Report of the Committee on Judicial
Administration and Remedial Procedure, reprinted in Report of
the Thirty-Fifth Annual Meeting of the American Bar
Association at 434-35 (1912) (resolving to adopt rules of
civil procedure for use in federal courts and " as a
model" ); see also Edson R. Sunderland, The Grant of
Rule-Making Power to the Supreme Court of the United States,
32 Mich. L.Rev. 1116, 1122 (1934) (authored by one of the
eventual drafters of the Federal Rules) (" [T]he primary
purpose [of the Federal Rules project] . . . was the
attainment of local uniformity in trial court practice
between the state and federal courts." ).
[¶17] Beyond the convenience and practical
benefits of permitting practicing attorneys to move
effortlessly from one forum to another, both this court and
the Supreme Court have long emphasized the undesirability of
having vastly different outcomes result from nothing more
than a choice of forums. See, e.g., Erie R. Co. v.
Tompkins, 304 U.S. 64, 77-78, 58 S.Ct. 817, 82 L.Ed.
1188 (1938); AE, Inc. v. Goodyear Tire & Rubber Co.,
168 P.3d 507, 511 (Colo. 2007) (" Colorado's policy
is to discourage . . . forum shopping." ). While state
courts are generally free to adopt procedural rules different
from those governing federal proceedings, but see Brown
v. W. Ry. of Ala., 338 U.S. 294, 298, 70 S.Ct. 105, 94
L.Ed. 100 (1949) (state court not permitted to dismiss
federal law claim under strict local rule of pleading), the
more outcome-determinative any specific disparity between
state and federal rules may be, the more undesirable that
disparity becomes. In this respect, there can be little
question that the difference between a rule of pleading that
effectively permits reliance on the compulsory process
available in civil actions to discover whether grounds for
the action exist in the first place and another that
effectively bars such reliance without being able to first
allege plausible grounds for relief can be extremely
outcome-determinative. One important benefit of uniformity in
federal and state procedures has been and continues to be the
reduction of forum shopping.
[¶18] In addition to the clear importance we
have identified in maintaining a substantial degree of
procedural uniformity between state and federal practice, we
also do not view the plausibility standard described by the
Supreme Court as effecting a meaningful departure from the
direction our interpretations and amendments have taken in
light of the existing realities of modern practice. Just as
the Supreme Court observed that a good many judges and
commentators have balked at taking the literal terms of the
Conley passage as a pleading standard, Twombly, 550 U.S. at
562-63 (citing numerous examples of Conley's " no
set of facts" language being " questioned,
criticized, and explained away" by judges and scholars,
alike), we have at times found it problematic to accept
factual allegations that appear too conclusory, and on at
least one occasion have, without openly criticizing the
" no set of facts" standard, simply found a
complaint insufficient to state a claim, for the reason that
it merely asserted a theory without alleging facts which, if
proved, would satisfy the elements of the claim, see
Denver Post Corp. v. Ritter,255 P.3d 1083, 1088
(Colo. 2011) (favorably citing Western Innovations, Inc.
v. Sonitrol Corp.,187 P.3d 1155, 1158 (Colo.App. 2008)
(itself relying on Twombly, 550 U.S. at 555-56)); see also
Pub. Serv. Co. of ...