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VBR Tours, LLC v. National Railroad Passenger Corp.

United States District Court, N.D. Illinois, Eastern Division

September 15, 2016

VBR TOURS, LLC, Plaintiff,
v.
NATIONAL RAILROAD PASSENGER CORP. and YANKEE LEISURE GROUP, INC., Defendants.

          MEMORANDUM OPINION AND ORDER

          Robert M. Dow, Jr. United States District Judge

         Plaintiff VBR Tours, LLC (“VBR”) brings suit against Defendants National Railroad Passenger Corp. (“Amtrak”) and Yankee Leisure Group, Inc. (“Yankee”) (collectively, “Defendants”) for alleged violations of Sections 1 and 2 of the Sherman Act and the Illinois Antitrust Act. On January 15, 2015, the Court granted Defendants' motion to dismiss VBR's complaint for failure to state a claim. See [46]. On September 28, 2015, the Court denied VBR's motion for reconsider of the Court's dismissal order, but granted VBR until October 26, 2015 to file a motion for leave to file an amended complaint, if VBR believed that it could overcome the deficiencies identified in the Court's orders. See [62]. On October 26, 2015, VBR filed a motion for leave to file an amended complaint. See [64] (motion); [64-1] (proposed amended complaint). Defendants oppose VBR's motion on the basis that amendment would be futile. See [71], [72], [73]. For the reasons explained below, the Court denies VBR's motion [62] for leave to file an amended complaint. The Court will allow VBR one more opportunity to consider whether it believes that it can cure the deficiencies identified above (and in the Court's prior opinions) through the filing of an amended complaint. If VBR wishes to file another motion for leave to file an amended complaint, it should file the motion, along with a copy of the proposed amended complaint, by 10/14/2016. This case is set for further status hearing on 10/20/2016 at 9:00 a.m. If VBR does not wish to seek leave to replead, it may so advise the Courtroom Deputy, in which case the Court will enter a final judgment under FRCP 58 and strike the October 20 status hearing.

         I. Background[1]

         VBR's original complaint [1] is outlined in detail in the Court's January 15, 2015 order, knowledge of which is assumed here. See [46]. In its prior order, the Court concluded that VBR's claims for violation of §§ 1 and 2 of the Sherman Act and the Illinois Antitrust Act must be dismissed because Plaintiff failed to allege an antitrust injury based on predatory pricing. The Court explained that VBR did not allege that Amtrak is pricing its tickets below cost or that Amtrak has a reasonable prospect or dangerous probability of recouping its alleged investment in below-cost prices. [46] at 9. The Court also pointed out that VBR did not provide any examples of potential competitors who tried and failed to enter the market or existing competitors who left the market. Id. The Court concluded that VBR failed to allege an antitrust injury, because it did not allege that Defendants' anticompetitive acts reduced output or raised prices to consumers. [46] at 10.

         VBR moved for reconsideration. On reconsideration, the Court reaffirmed its prior decision and also concluded that VBR failed to make plausible allegations of anticompetitive conduct under any of four “refusal to deal” theories: (a) predatory pricing; (b) denial of access to an essential facility; (c) Aspen Skiing; or (d) exclusive dealing. See [62].

         VBR now seeks leave to file an amended complaint for attempted monopolization in violation of § 2 of the Sherman Act and the Illinois Antitrust Act (Counts I and IV, respectively) and conspiracy to monopolize in violation of § 2 of the Sherman Act and the Illinois Antitrust Act (Counts II and V, respectively). VBR also alleges a claim for violation of § 1 of the Sherman Act, but only for the purposes of preserving the claim for appeal. See [72-1] at 36.

         II. Legal Standard

         A motion for leave to file an amended complaint should “freely” be granted “where justice so requires.” Fed.R.Civ.P. 15(a)(2). “This liberal policy of granting amendments is based in part on the belief that decisions on the merits should be made whenever possible, absent countervailing considerations.” Olech v. Vill. of Willowbrook, 138 F.Supp.2d 1036, 1040 (N.D. Ill. 2000) (citation omitted). Leave to amend should be given “‘[i]n the absence of any apparent or declared reason-such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of the allowance of the amendment, [or] futility of amendment.'” Barry Aviation, Inc. v. Land O'Lakes Mun. Airport Comm'n, 377 F.3d 682, 687 (7th Cir. 2004) (quoting Foman v. Davis, 371 U.S. 178 (1962)). Ultimately, “‘[t]he decision to grant or deny a motion to file an amended pleading is a matter purely within the sound discretion of the district court.'” Soltys v. Costello, 520 F.3d 737, 743 (7th Cir. 2008) (quoting Brunt v. Serv. Employees Int'l Union, 284 F.3d 715, 720 (7th Cir. 2002)).

         The filing of an amended complaint is futile if it would not withstand a motion to dismiss. Gandhi v. Sitara Capital Mgmt., LLC, 721 F.3d 865, 869 (7th Cir. 2013). To survive a Rule 12(b)(6) motion to dismiss, the complaint first must comply with Rule 8(a) by providing “a short and plain statement of the claim showing that the pleader is entitled to relief, ” Fed.R.Civ.P. 8(a)(2), such that the defendant is given “fair notice of what the * * * claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). Second, the factual allegations in the complaint must be sufficient to raise the possibility of relief above the “speculative level.” E.E.O.C. v. Concentra Health Servs., Inc., 496 F.3d 773, 776 (7th Cir. 2007) (quoting Twombly, 550 U.S. at 555). “A pleading that offers ‘labels and conclusions' or a ‘formulaic recitation of the elements of a cause of action will not do.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 555). However, “[s]pecific facts are not necessary; the statement need only give the defendant fair notice of what the * * * claim is and the grounds upon which it rests.” Erickson v. Pardus, 551 U.S. 89, 93 (2007) (citing Twombly, 550 U.S. at 555) (ellipsis in original). Dismissal for failure to state a claim under Rule 12(b)(6) is proper “when the allegations in a complaint, however true, could not raise a claim of entitlement to relief.” Twombly, 550 U.S. at 558. The Court reads the complaint and assesses its plausibility as a whole. See Atkins v. City of Chicago, 631 F.3d 823, 832 (7th Cir. 2011).

         III. Analysis

         Plaintiff's attempted monopolization/refusal to deal claim (Count I) and conspiracy to monopolize claim (Count II) are both brought pursuant to § 2 of the Sherman Act. Count I is brought against Amtrak only, and Count II is brought against both Amtrak and Yankee.

         To succeed on its attempted monopolization claim against Amtrak, Plaintiff must show “(1) specific intent to achieve monopoly power, (2) predatory or anticompetitive conduct directed to accomplishing this unlawful purpose, and . . ., (3) a dangerous probability that the attempt to monopolize will be successful.” Indiana Grocery, Inc. v. Super Valu Stores, Inc., 864 F.2d 1409, 1413 (7th Cir. 1989); see also Thompson's Gas & Elec. Serv., Inc. v. BP Am. Inc., 691 F.Supp.2d 860, 867 (N.D. Ill. 2010). To succeed on its conspiracy to monopolize claim against Amtrak and Yankee, VBR “must prove 1) the existence of a combination or conspiracy, 2) overt acts in furtherance of the conspiracy, 3) an effect upon a substantial amount of interstate commerce[, ] and 4) the existence of specific intent to monopolize.” Great Escape, Inc. v. Union City Body Co., 791 F.2d 532, 540-41 (7th Cir. 1986); see also Hackman v. Dickerson Realtors, Inc., 746 F.Supp.2d 962, 967 (N.D. Ill. 2010). Under these standards, both of VBR's Sherman Act claims must be supported by plausible allegations of anticompetitive conduct. In addition, both claims must be supported by plausible allegations of an antitrust injury.

         A. Anticompetitive Conduct

         “As a general rule, businesses are free to choose the parties with whom they will deal, as well as the prices, terms, and conditions of that dealing.” Pac. Bell Tel. Co. v. Linkline Commc'ns, Inc., 555 U.S. 438, 448 (2009). The Supreme Court and the Seventh Circuit have recognized several ...


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