Filed: Mar. 18, 2016
Latest Update: Mar. 02, 2020
Summary: 13-3933 Concord Associates, L.P. v. Entertainment Properties Trust UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT August Term, 2014 (Argued: April 29, 2015 Decided: March 18, 2016) Docket No. 13-3933-cv _ _ CONCORD ASSOCIATES, L.P., CONCORD RACEWAY CORPORATION, CONCORD KIAMESHA CASINO, LLC, CONCORD KIAMESHA CAPITAL CORP., CONCORD RESORT, LLC, CONCORD KIAMESHA, LLC, CONCORD KIAMESHA HOTEL, LLC, Plaintiffs-Appellants, - v. - ENTERTAINMENT PROPERTIES TRUST, EPT CONCORD, LLC, EPT CONCORD II,
Summary: 13-3933 Concord Associates, L.P. v. Entertainment Properties Trust UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT August Term, 2014 (Argued: April 29, 2015 Decided: March 18, 2016) Docket No. 13-3933-cv _ _ CONCORD ASSOCIATES, L.P., CONCORD RACEWAY CORPORATION, CONCORD KIAMESHA CASINO, LLC, CONCORD KIAMESHA CAPITAL CORP., CONCORD RESORT, LLC, CONCORD KIAMESHA, LLC, CONCORD KIAMESHA HOTEL, LLC, Plaintiffs-Appellants, - v. - ENTERTAINMENT PROPERTIES TRUST, EPT CONCORD, LLC, EPT CONCORD II, L..
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13‐3933
Concord Associates, L.P. v. Entertainment Properties Trust
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term, 2014
(Argued: April 29, 2015 Decided: March 18, 2016)
Docket No. 13-3933-cv
________________________________________________________________
________
CONCORD ASSOCIATES, L.P., CONCORD RACEWAY CORPORATION, CONCORD KIAMESHA
CASINO, LLC, CONCORD KIAMESHA CAPITAL CORP., CONCORD RESORT, LLC, CONCORD
KIAMESHA, LLC, CONCORD KIAMESHA HOTEL, LLC,
Plaintiffs-Appellants,
- v. -
ENTERTAINMENT PROPERTIES TRUST, EPT CONCORD, LLC, EPT CONCORD II, LLC,
EMPIRE RESORTS, INC., MONTICELLO RACEWAY MANAGEMENT, INC., GENTING NEW YORK
LLC, JOHN DOES 1—5, KIEN HUAT REALTY III LIMITED,
Defendants-Appellees.
________________________________________________________________
Before: JACOBS, POOLER, AND HALL, Circuit Judges.
Appeal from the United States District Court for the
Southern District of New York (Ramos, J.) granting
defendants’ motions to dismiss claims of violations of the
Sherman Act, 15 U.S.C. §§ 1 & 2, and denying plaintiffs’
motion for reconsideration. In order to state a claim for
a Sherman Act violation, a plaintiff must allege an
antitrust injury, define the relevant geographic market,
and allege conduct in violation of antitrust laws. The
District Court found, with respect to the Sherman Act
claims, that the plaintiffs’ proposed geographic and
product markets were not sufficiently plausible to survive
a motion to dismiss. We agree and hold that the plaintiffs
fail to state a claim for violations of the Sherman Act
and, accordingly, AFFIRM the District Court’s dismissal of
the complaint.
SCOTT A. MARTIN, (James I. Serota &
Carmen Beauchamp Ciparick, on the
brief), Greenberg Traurig, LLP, New
York, New York, and Alfred E.
Donnellan, DelBello Donnellan
Weingarten Wise & Wiederkehr,
L.L.P., White Plains, NY, for
Plaintiffs-Appellants Concord
Associates, L.P., Concord Raceway
Corporation, Concord Kiamesha
Casino, LLC, Concord Kiamesha
Capital Corp., Concord Resort, LLC,
Concord Kiamesha, LLC and Concord
Kiamesha Hotel, LLC.
MOSES SILVERMAN (Joshua D. Kaye, Jason
L. Meizlish, & Elana R. Beale, on
the brief), Paul, Weiss, Rifkind,
Wharton & Garrison LLP, New York, New
York, for Defendants-Appellees
Empire Resorts, Inc. and Monticello
Raceway Management, Inc.
Y. DAVID SCHARF, (Kristin T. Roy, &
Gayle Pollack, on the brief)
Morrison Cohen LLP, New York, New
York, for Defendant-Appellee
Entertainment Properties Trust, EPT
Concord, LLC, and EPT Concord II,
LLC.
HOWARD ZELBO (Leah Brannon, on the
brief), Cleary Gottlieb Steen &
Hamilton LLP, New York, NY, for
Defendants-Appellees Kien Huat
Realty III Limited and Genting New
York LLC.
HALL, Circuit Judge:
Plaintiffs-Appellants are seven entities who are
collectively attempting to develop a casino-resort complex in
2
the Catskills region of New York State. Defendants-Appellees are
three groups of investors and business owners with an interest
in the casino industry and horse racing in the Catskills who,
the plaintiffs claim, entered into an anti-competitive scheme to
obstruct the plaintiffs’ resort development project. Underlying
this antitrust dispute is a threshold question that is
ultimately dispositive of this appeal: For the purposes of an
antitrust claim, whether the plaintiffs have alleged a plausible
relevant geographic market for their casino-related products and
services.
Facts and Procedural History
The facts of this case, which we view in the light most
favorable to the plaintiffs, are set out in the district court’s
Order and Opinion in detail and are briefly summarized as
follows. The plaintiffs, including Concord Associates, L.P.
(“Concord Associates”), Concord Raceway Corporation, Concord
Kiamesha Capital Corporation, Concord Resort, LLC (“Concord
Resort”), Concord Kiamesha, LLC, and Concord Kiamesha Hotel,
LLC, are collectively attempting to develop a casino gambling
resort and race track known as the New Concord Casino Resort at
the site of the former Concord Resort Hotel, located in the
Catskills Mountains in Thompson, New York. The defendants,
including Entertainment Properties Trust, EPT Concord, LLC, and
EPT Concord II, LLC (collectively, “EPT”); Empire Resorts, Inc.
3
and Monticello Raceway Management, Inc. (collectively “Empire”);
Kien Huat Realty III Limited (“Kien Huat Realty”); Genting New
York LLC and John Doe entities 1–5 (collectively “Genting” or
“Genting defendants”), are real estate developers and casino and
gambling facility operators.
The plaintiffs intend to develop racing and casino gambling
facilities, known as “racinos,” on two adjoining properties,
including 140 acres at the site of the Concord Resort Hotel,
which was once a world-famous vacation destination for visitors
to the Catskills Mountains until its closing and bankruptcy in
1998, and also 1,500 acres of adjacent land containing golf
courses, residential properties, and vacant land. In 1999,
plaintiff Concord Associates purchased these land parcels from
the Concord Resort Hotel bankruptcy estate. In furtherance of
their development efforts, the plaintiffs have conducted an
environmental review, obtained necessary preliminary licensing
approvals and development permits, and performed substantial
work at the construction site.
In June 2010, as part of a legal settlement intended to
resolve several lawsuits between defendant EPT and plaintiff
Concord Associates, the plaintiffs transferred the 1,500 acre
parcel to defendant EPT Concord II. Under the settlement, the
plaintiffs retained the right for exclusive use and exploitation
of the property, including the right to develop the proposed
4
resort. Accordingly, Concord Associates entered into an
agreement with EPT Concord II that specifically reserved the
right for the plaintiffs to lease a tract for a “racino” on the
property along with additional easements, leases, and other
rights related to development of the property. In addition, the
terms included a restrictive covenant pursuant to which EPT
Concord II agreed that its successors or assignees would not own
or operate any competing casino, racino, racing or gaming
facility on the property.
In addition to entering the agreement with EPT Concord II,
the plaintiffs entered into a contractual relationship with
Empire to further the development of their resort. Since 1993,
Empire had owned and operated the Monticello Raceway, located
approximately four miles from the plaintiffs’ proposed resort.
In 2004, the Monticello Raceway began offering casino gaming,
and since that time it has been the only race track or casino in
the Catskills. The closest racinos are eighty miles away in
Pennsylvania, and 100 miles away in Yonkers. Monticello Raceway
also claims that it “does not compete directly with other
harness racing tracks in New York State for live racing
patrons.” Am. Compl. ¶ 131. Thus, according to the plaintiffs,
Empire’s position as the sole operator of casino gaming in the
Catskills makes it “the only game in town” for local consumers
and tourists. Am. Compl. ¶ 133.
5
Empire was initially supportive of the plaintiffs’ proposed
resort, and in March 2009 it entered into an agreement with
Concord Associates to provide management services at the
plaintiffs’ proposed Raceway. But in November 2009, defendant
Kien Huat Realty—which, together with other Genting defendants
makes up one of the world’s largest gaming conglomerates—
acquired a majority interest in Empire. According to plaintiffs,
Kien Huat Realty has since worked to undermine plaintiffs’
resort project. Shortly after November 2009, Empire ceased
cooperating with the plaintiffs and opened a rival “racino” in
collaboration with Genting at the site of the Aqueduct Race
Track, approximately 100 miles from the site of the plaintiffs’
proposed Resort. In addition, in April 2011 EPT and Empire
entered into an exclusive agreement to develop their own
“racino” project adjacent to the plaintiffs’ proposed resort and
repudiated the lease and restrictive covenants promised to
Concord Associates. The plaintiffs claim that Genting, EPT and
Empire are all members of an anti-competitive scheme to
undermine the plaintiffs’ resort development project.
After bringing actions for breach of contract in the New
York state court without success,1 the plaintiffs commenced this
federal antitrust action on March 7, 2012. In response to the
1
See Concord Assocs., L.P. v. EPT Concord, LLC, No. 1611-
2011 (N.Y. Sup. Ct. Sullivan Cnty. June 30, 2014).
6
defendants’ motions to dismiss, the plaintiffs filed a First
Amended Complaint (the “Amended Complaint”) that purported to
define the relevant geographic market for the products the
plaintiffs’ resort would have to offer. As pleaded, that
relevant market includes the area within a radius of
approximately 100 miles from the Town of Thompson, with a total
population of more than 18–20 million people, of whom almost
ninety percent reside in the New York City metropolitan area
(“NY Metro area”). In response to the Amended Complaint, the
defendants moved to dismiss it on the basis that the plaintiffs
had not defined a plausible geographic market. Ultimately, the
district court granted the motions to dismiss as to all
defendants without considering the additional materials the
plaintiffs submitted or a proposed Second Amended Complaint.2
2
The plaintiffs contend that the district court erred in
failing to consider extrinsic materials they submitted in
opposition to the defendants’ motions to dismiss, including
several exhibits and Securities & Exchange disclosures. The
plaintiffs claim that these documents show that Genting
conspired to exclude market competition in violation of
antitrust laws. We need not address the substance of the
plaintiffs’ arguments because our decision is based on the
plaintiffs’ failure to allege a plausible relevant market in
which competition could be restrained. In any event, the
district court correctly declined to consider the extrinsic
materials, as they were not incorporated by reference or
otherwise integral to the Complaint. See Allen v. WestPoint–
Pepperell, Inc., 945 F.2d 40, 44 (2d Cir. 1991) (stating that,
in adjudicating Rule 12(b)(6) motion, district court must
confine its consideration “to facts stated on the face of the
complaint, in documents appended to the complaint or
incorporated in the complaint by reference, and to matters of
7
See Concord Assocs., L.P v. Entm’t Props. Tr., et al., No. 12-
1667, 2014 WL 1396524, at *27 (S.D.N.Y. Apr. 9, 2014). Further,
the court dismissed the plaintiffs’ state law claims, declining
to exercise supplemental jurisdiction under 28 U.S.C.
§ 1367(c)(3).3
Id. The plaintiffs filed a motion for
reconsideration, which the district court denied, reasoning that
it could not consider materials not presented as part of the
Amended Complaint and that, in any event, the plaintiffs’
additional arguments failed to rectify their fatally flawed
market definitions. See Concord Assocs., L.P. v. Entm’t Props.
Tr., No. 12-1667,
2014 WL 5643240, at *6–7 (S.D.N.Y. Nov. 3,
2014).
On appeal, the plaintiffs contend that the district court
erred in deciding that the Amended Complaint failed to allege a
plausible relevant geographic market and that the factual
allegations were insufficient to connect certain of the
defendants to the alleged conspiracy. The plaintiffs also claim
the district court erred in denying them leave to amend the
which judicial notice may be taken”). Further, even if the
documents were properly the subject of judicial notice, judicial
notice would not be appropriate because the plaintiffs did not
rely on the documents in drafting the Complaint. Chambers v.
Time Warner, Inc., 282 F.3d 147, 153 (2d Cir. 2002).
3
In this appeal, the plaintiffs have not specifically
challenged the district court’s dismissal of their state law
claims, and we therefore consider any such challenge to be
waived. See JP Morgan Chase Bank v. Altos Hornos de Mexico, S.A.
de C.V., 412 F.3d 418, 428 (2d Cir. 2005).
8
Amended Complaint. Because we agree with the district court that
the plaintiffs’ proposed market definition is inherently
implausible, we find that the plaintiffs failed to allege
adequate facts to state a violation of the Sherman Act.
Therefore, we affirm the judgment of the district court
dismissing the complaint.
Analysis
This court “review[s] de novo a district court’s dismissal
of a complaint pursuant to Rule 12(b)(6), construing the
complaint liberally, accepting all factual allegations in the
complaint as true, and drawing all reasonable inferences in the
plaintiff’s favor.” Chambers v. Time Warner Inc., 282 F.3d 147,
152 (2d Cir. 2002).
“To survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state a claim
to relief that is plausible on its face.’” Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007)). A claim is facially plausible “when
the plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable for
the misconduct alleged,” meaning that there is “more than a
sheer possibility that a defendant acted unlawfully.”
Id.
(citing Twombly, 550 U.S. at 556-57). At the same time, there is
no heightened pleading standard in antitrust cases, and the
9
facts alleged are subject to Federal Rule of Civil Procedure
8(a)’s general requirement of a “short plain statement” of facts
supporting a plausible claim. Todd v. Exxon Corp., 275 F.3d 191,
198 (2d Cir. 2001).
The plaintiffs brought claims under Sections One and Two of
the Sherman Act. Section One of the Sherman Act declares illegal
“[e]very contract, combination . . . , or conspiracy, in
restraint of trade or commerce . . . .” 15 U.S.C. § 1. Section
Two of the Sherman Act makes it illegal “to monopolize, or
attempt to monopolize, or combine or conspire . . . to
monopolize . . . trade or commerce . . . .” 15 U.S.C. § 2.
Section Four of the Clayton Act provides a private right of
action, with a recovery of treble damages, to “any person who
[has been] injured in his business or property by reason of
anything forbidden in the antitrust laws . . . .” 15 U.S.C. §
15(a).
To survive a motion to dismiss, a Sherman Act claim must
“(1) define the relevant geographic market, (2) allege an
antitrust injury, and (3) allege conduct in violation of
antitrust laws.” New York Medscan LLC v. N.Y. Univ. Sch. Of
Med., 430 F. Supp. 2d 140, 145 (S.D.N.Y. 2015). In such actions,
the relevant market is the “‘area of effective competition’
within which the defendant operates.” AD/SAT, Div. of Skylight,
Inc. v. Assoc. Press,
181 F.3d 216, 227 (2d Cir. 1999) (quoting
10
Tampa Electric Co. v. Nashville Coal Co., 365 U.S. 320, 327-28
(1961)). That is, a market consists of an area where sellers,
“if unified by a hypothetical cartel or merger, could profitably
raise prices significantly above the competitive level.”
Id. at
228.
For antitrust purposes, the concept of a market has two
components: a product market and a geographic market. Bayer
Schering Pharma AG v. Sandoz, Inc., 813 F. Supp. 2d 569, 574
(S.D.N.Y 2011). “A relevant product market consists of ‘products
that have reasonable interchangeability for the purposes for
which they are produced—price, use and qualities considered.’”
PepsiCo, Inc. v. Coca–Cola Co.,
315 F.3d 101, 105 (2d Cir. 2002)
(per curiam) (quoting United States v. E.I. du Pont de Nemours &
Co.,
351 U.S. 377, 404 (1956)). By contrast, “the geographic
market analysis seeks to identify the precise geographic
boundaries of effective competition in order to reach a more
informed conclusion on potential harm to the market.” Mathias v.
Daily News, L.P.,
152 F. Supp. 2d 465, 480 (S.D.N.Y. 2001).
“Courts generally measure a market’s geographic scope, the ‘area
of effective competition,’ by determining the areas in which the
seller operates and where consumers can turn, as a practical
matter, for supply of the relevant product.” Heerwagen v. Clear
Channel Commc’ns,
435 F.3d 219, 227 (2d Cir. 2006) (citation
omitted), overruled on other grounds by Teamsters Local 445
11
Freight Div. Pension Fund v. Bombardier Inc., 546 F.3d 196,
201 (2d Cir. 2008).
“Taken together, the product and geographic components
illuminate the relevant market analysis, which is essential for
assessing the potential harm to competition from the defendants’
alleged misconduct.” Mathias, 152 F. Supp. 2d at 481. And this
analysis is equally applicable to claims made under Section Two
of the Sherman Act, because “without a definition of that market
there is no way to measure the defendant’s ability to lessen or
destroy competition.” Xerox Corp. v. Media Sciences Int’l, Inc.,
511 F. Supp. 2d 372, 383 (S.D.N.Y. 2007) (quoting Walker Process
Equip., Inc. v. Food Mach. & Chem. Corp.,
382 U.S. 172, 177
(1965) (internal alterations omitted)).
Although market definition is a “deeply fact-intensive
inquiry” not ordinarily subject to dismissal at the pleadings
stage, Todd, 275 F.3d at 199, there is “no absolute rule”
against dismissal where the plaintiff has failed to articulate a
plausible explanation as to why a market should be limited in a
particular way,
id. at 200. Thus, in order to survive a motion
to dismiss, it is appropriate for a district court to assess
whether the plaintiffs’ complaint asserts sufficient facts to
allege plausibly the existence of both a product and geographic
market. Id.
12
The district court determined that the plaintiffs’
antitrust claims were subject to dismissal4 because the
plaintiffs had failed to plead a plausible relevant
racing/gaming market in the Catskills region.5 Concord Assocs.,
2014 WL 1396524, at **10, 16-17. It found the plaintiffs’
proposed geographic market “too narrow and inherently
implausible.”
Id. at *16. We agree.
The plaintiffs have provided no basis on which to justify
their proposed geographic market definition. Although they
define the relevant market as “the Racing/Gaming Market in the
Catskills region,” Appellants’ Br. 15, an area consisting of
primarily four counties, they also assert that the resort would
draw customers from a “catchment area” consisting of twenty-
4
Because we affirm the district court on the basis that
the plaintiffs failed to allege a plausible geographic market,
we do not decide whether the plaintiffs also failed to allege an
antitrust violation or an antitrust injury.
5
As an initial matter, the plaintiffs claim to have
alleged that the defendants committed a per se violation of
Section 1 of the Sherman Act by engaging in “a group boycott”
and a “refusal to deal,” which relieves the plaintiffs from the
requirement of demonstrating a market-wide anticompetitive
effect. A per se violation involves conduct “so plainly harmful
to competition and so obviously lacking in any redeeming pro-
competitive values that [it is] ‘conclusively presumed illegal
without further examination.’” Capital Imaging Assocs., P.C. v.
Mohawk Valley Med. Assocs., Inc., 996 F.2d 537, 542 (2d Cir.
1993) (quoting Broadcast Music, Inc. v. CBS,
441 U.S. 1, 8
(1979)). We agree with the district court that the plaintiffs
have failed to allege a per se violation of the Sherman Act.
See Concord Assocs.,
2014 WL 1396524, at *11.
13
three counties in New York, Northeastern New Jersey, and
Pennsylvania, with a total population of more than 18–20 million
people. Concord Assocs., 2014 WL 1396524, at *14. Conveniently
for the plaintiffs, this proposed market definition excludes
gambling markets in Connecticut, Pennsylvania, and New Jersey
that are well-known and accessible to residents of the NY Metro
area. We find unpersuasive the plaintiffs’ claim that the bulk
of the resort’s potential customers would not view Atlantic City
and Connecticut as “reasonably interchangeable substitutes for a
Catskills racino in terms of distance as well as regional
character.” Appellants’ Br. 22. Although facilities in the
latter locations are approximately 125 miles from the NY Metro
area rather than 100 miles, the plaintiffs fail to present a
plausible basis for explaining why an additional twenty-five
miles makes the difference. These locations are reasonably
accessible by car to NY Metro area residents, and as the
plaintiffs concede, these other facilities provide amenities
comparable to the plaintiffs’ proposed resort.
As for the “regional character” of the Catskills, the
plaintiffs argue that the Catskills region comprises a “unique”
geographic market for a “racino” and hotel complex based on its
status as a tourist destination with “popular natural resources
for water sports, mountain sports, hunting and golf.” Am. Compl.
¶ 154. However, “[m]erely asserting that a commodity is in some
14
way unique is insufficient to plead a relevant market. Rather,
an antitrust complaint must explain why the market it alleges is
the relevant, economically significant product market.” B.V.
Optische Industrie De Oude Delft v. Hologic, Inc., 909 F. Supp.
162, 171 (S.D.N.Y. 1995). We agree with the district court that
the plaintiffs have not plausibly alleged why their proposed
resort differs from the variety of other options for tourists to
combine a gambling trip, access to natural resources, and other
related activities available more or less the same distance from
the NY Metro area as Thompson, New York. See, e.g., Smugglers
Notch Homeowners’ Assoc., Inc. v. Smugglers’ Notch Mmgt. Co.,
Ltd., 08 Civ. 186,
2009 WL 1545829 (D. Vt. May 29, 2009),
affirmed, 414 F. App’x 372 (2d Cir. 2011) (holding that antitrust
plaintiffs had not shown why their “vacation properties and
recreation facilities . . . are different from the myriad other
options at ski resorts in Vermont”). We agree with the
defendants’ argument that various locations around New York City
could also be thought of as tourist destinations, where tourists
could gamble and have access to natural resources and other
related activities.
The plaintiffs compare their proposed geographic market to
the Aspen skiing market and the Atlantic City gambling market,
both of which have been implicitly recognized as valid market
definitions in antitrust suits. See Aspen Skiing Co. v. Aspen
15
Highlands Skiing Corp., 472 U.S. 585, 587-88 (1985); Mirage
Resorts, Inc. v. Trump, No. 97 Civ. 6693(DAB),
1998 WL 898340,
at *2 (S.D.N.Y Dec. 22, 1998). But the plaintiffs in those cases
contended that the markets were highly localized, as tourists
specifically came to Aspen and Atlantic City, and then
considered only product options within those destination
locations for skiing and gambling, respectively. See Aspen
Skiing
Co., 472 U.S. at 596 (describing Aspen as a “destination”
market and detailing dispute among ski resorts within Aspen);
Mirage Resorts, Inc.,
1998 WL 898340, at *3 (stating plaintiff’s
claim that defendant had “suppress[ed] competition in the
Atlantic City gaming market”). Furthermore, the market
definitions in Aspen Skiing and Mirage Resorts were not subject
to challenge, and the validity of those market definitions was
therefore not at issue. See Aspen Skiing
Co., 472 U.S. at 597–98
(explaining that primary issue before jury was whether defendant
had monopolized the market); Mirage Resorts, Inc.,
1998 WL
898340, at *2 (stating that defendant’s arguments for dismissal
included plaintiff’s failure to allege anti-competitive
activities, elements of a conspiracy, or injury to competition).
While plaintiffs argue that some gambling markets are
uniquely localized, relying on In the Matter of Pinnacle
Entertainment, Inc., No. 9355, 2013 WL 2444712, at *9–10 (F.T.C.
May 28, 2013), the mere fact that certain gambling markets may
16
be localized does not relieve the plaintiffs of the requirement
to show why the Catskills gambling market is a localized or
regional market—particularly where the vast majority of
customers are not local and have a myriad of other comparable
options.
Moreover, as the district court noted, “by arbitrarily
excising those alternative options and essentially arguing that
there are no comparable competitors, Plaintiffs exempt
themselves from the requirement of defining the market according
to the rules of interchangeability and cross-elasticity.”
Concord Assocs., 2014 WL 1396524 at *17. In so doing, the
plaintiffs further undermine the plausibility of their antitrust
claims. See B.V. Optische Industrie De Oude
Delft, 909 F. Supp.
at 171-72 (“Because a relevant market includes all products
which are reasonably interchangeable, . . . [the plaintiffs’]
failure to define [the] market by reference to the rule of
reasonable interchangeability is, standing alone, valid grounds
for dismissal.”) (internal quotation and citation omitted).
Because plaintiffs failed to plead a relevant geographic
market in the Amended Complaint, the district court correctly
concluded that each of the Sherman Act claims was subject to
dismissal.
Finally, we address the plaintiffs’ argument that the
district court erred by not granting them leave to file a second
17
amended complaint. We review for abuse of discretion a district
court’s decision to deny a party leave to amend a complaint.
Grochowski v. Phoenix Const., 318 F.3d 80, 86 (2d Cir. 2003).
The plaintiffs contend that the district court erroneously
determined that the plaintiffs had withdrawn their request for
leave to amend the Amended Complaint. See Concord Associates,
2014 WL 1396524, at *27. We need not decide this question,
however, because granting leave to file a second amended
complaint would have been futile. See Nielsen v. Rabin, 746 F.3d
58, 62 (2d Cir. 2014). Although the plaintiffs’ proposed Second
Amended Complaint alleges two relevant markets—a “Catskills
Racing/Gaming Market,” ¶ 151, and a “Downstate New York
Racing/Gaming Market,” ¶ 158—rather than one market, these
proposed markets refer to the same geographic area as the market
alleged in the Amended Complaint. This re-characterization fails
to remedy the flaws in the plaintiffs’ proposed geographic
market definition.
Conclusion
We hold that the plaintiffs’ pleadings fail to define a
plausible relevant geographic or product market for antitrust
purposes, and that the district court properly dismissed their
Sherman Act claims. The judgment of the district court is
AFFIRMED.
18
