FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT


CHINATOWN NEIGHBORHOOD                     No. 14-15781
ASSOCIATION, a nonprofit
corporation; ASIAN AMERICANS FOR              D.C. No.
POLITICAL ADVANCEMENT, a                   3:12-cv-03759-
political action committee,                    WHO
                  Plaintiffs-Appellants,

                  v.                         OPINION

KAMALA HARRIS, Attorney General
of the State of California; CHARLTON
H. BONHAM, Director, California
Department of Fish and Game,
                Defendants-Appellees,

HUMANE SOCIETY OF THE UNITED
STATES; MONTEREY BAY AQUARIUM
FOUNDATION; ASIAN PACIFIC
AMERICAN OCEAN HARMONY
ALLIANCE,
   Intervenor-Defendants–Appellees.


     Appeal from the United States District Court
         for the Northern District of California
  William Horsley Orrick III, District Judge, Presiding

                 Argued and Submitted
       March 18, 2015—San Francisco, California
2       CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

                        Filed July 27, 2015

         Before: Stephen Reinhardt, John T. Noonan,
          and Andrew D. Hurwitz, Circuit Judges.

                   Opinion by Judge Hurwitz;
                   Dissent by Judge Reinhardt


                           SUMMARY*


                            Civil Rights

    The panel affirmed the district court’s dismissal of
plaintiffs’ amended complaint challenging California’s
“Shark Fin Law,” which makes it “unlawful for any person
to possess, sell, offer for sale, trade, or distribute a shark
fin” in the state.

    The panel rejected plaintiffs’ claim that the Shark Fin
Law is preempted by the Magnuson-Stevens Fishery
Conservation and Management Act. The panel held that
plaintiffs failed to identify any actual conflict between
federal authority under the Magnuson-Stevens Act to
manage shark fishing in the ocean off the California coast
and the California Shark Fin Law. The panel further held
that the district court did not abuse its discretion by failing



    *
   This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                3

to sua sponte grant plaintiffs leave to amend so they could
plead additional facts to support the preemption claim. The
panel held that even assuming that plaintiffs preserved the
argument for appeal, leave to amend would be futile.

     The panel rejected plaintiffs’ claim that the Shark Fin
Law is per se invalid under the Commerce Clause because
it interferes with the interstate commerce in shark fins. The
panel held that even when state law has significant
extraterritorial effects, it passes Commerce Clause muster
when, as here, those effects result from the regulation of in-
state conduct. The panel further determined that the Shark
Fin Law does not interfere with activity that is inherently
national or that requires a uniform system of regulation,
and that, accordingly, there is no significant interference
with interstate commerce.

    Judge Reinhardt dissented in part because he believes
that plaintiffs must be granted leave to amend the
complaint with respect to their preemption claim.


                        COUNSEL

Michael Tenenbaum (argued), The Michael Tenenbaum
Law Firm, Santa Monica, California; Joseph M. Breall,
Breall & Breall LLP, San Francisco, California, for
Plaintiffs-Appellants.
Kamala D. Harris, Attorney General of California, Douglas
J. Woods, Senior Assistant Attorney General, Tamar
Pachter, Supervising Deputy Attorney General, Alexandra
Robert Gordon (argued), Deputy Attorney General, San
Francisco, California, Attorneys for Defendants-Appellees.
4     CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

Bruce A. Wagman, Schiff Hardin LLP, San Francisco,
California; Ralph E. Henry (argued), The Humane Society
of the United States, Washington, DC, Attorneys for
Intervenors-Defendants-Appellees The Humane Society of
the United States, Monterey Bay Aquarium Foundation,
and Asian Pacific Americans for Ocean Harmony Alliance.
Seth L. Atkinson, Natural Resources Defense Council, San
Francisco, California, for Amicus Curiae Natural Resources
Defense Council.




                        OPINION

HURWITZ, Circuit Judge:

    California’s “Shark Fin Law” makes it “unlawful for
any person to possess, sell, offer for sale, trade, or
distribute a shark fin” in the state. Cal. Fish & Game Code
§ 2021(b). The plaintiffs in this action claim that the Shark
Fin Law violates the Supremacy Clause by interfering with
the national government’s authority to manage fishing in
the ocean off the California coast, and the dormant
Commerce Clause by interfering with interstate commerce
in shark fins. The district court dismissed the plaintiffs’
amended complaint with prejudice, and we affirm.

                             I.

                             A.

   The Magnuson-Stevens Fishery Conservation and
Management Act (“MSA”), 16 U.S.C. §§ 1801-1884, “was
enacted to establish a federal-regional partnership to
       CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                     5

manage fishery resources.” Nat’l Res. Def. Council, Inc. v.
Daley, 

, 749 (D.C. Cir. 2000). Under the
MSA, the federal government exercises “sovereign rights
and exclusive fishery management authority over all fish,
and all Continental Shelf fishery resources, within the
exclusive economic zone” (“EEZ”), 16 U.S.C. § 1811(a),
which extends from the seaward boundary of each coastal
state to 200 miles offshore,1 

City of
Charleston v. A Fisherman’s Best, Inc., 

, 160
(4th Cir. 2002). The MSA expressly preserves the
jurisdiction of the states over fishery management within
their boundaries. See 16 U.S.C. § 1856(a)(1).

    To manage fishing in the EEZ, the MSA calls for the
creation of regional Fishery Management Councils
(“FMCs”), composed of state and federal officials and
experts appointed by the Secretary of the National Marine
Fisheries Service (“NMFS”). 16 U.S.C. § 1852(b)(1)-(2).
With the cooperation of “the States, the fishing industry,
consumer and environmental organizations, and other
interested persons,” 

the NMFS and FMCs
develop and promulgate Fishery Management Plans
(“FMPs”) to “achieve and maintain, on a continuing basis,
the optimum yield from each fishery,” 

In




 1
    In California, the seaward boundary is three miles offshore.
Vietnamese Fishermen Ass’n of Am. v. Cal. Dep’t of Fish & Game,

, 1470 (N.D. Cal. 1993).
 2
    See, e.g., Fishery Management Plan for U.S. West Coast Fisheries
for Highly Migratory Species, Pacific Fishery Management Council
6     CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

the MSA, “optimum yield” means the amount of fish that
“will provide the greatest overall benefit to the Nation,
particularly with respect to food production and
recreational opportunities, and taking into account the
protection of marine ecosystems.” 

see also
50 C.F.R. § 600.310(e)(3).

                              B.

    Shark finning is the practice of removing the fins from
a living shark. The primary market for shark fins is to
make shark fin soup, a traditional Chinese dish.

    Even before the Shark Fin Law was passed, federal and
state law prohibited finning in the waters off the California
coast. In 1995, the California legislature made it “unlawful
to sell, purchase, deliver for commercial purposes, or
possess on any commercial fishing vessel . . . any shark fin
or shark tail or portion thereof that has been removed from
the carcass.” Cal. Fish & Game Code § 7704(c); see 1995
Cal. Legis. Serv. ch. 371, § 1 (S.B. 458). In 2000,
Congress added finning prohibitions to the MSA, which, as
amended in 2011, make it unlawful to remove the fins from
a shark at sea, possess detached fins aboard fishing vessels,
transfer them from one vessel to another, and land them
onshore. See 16 USC § 1857(1)(P); Conservation of
Sharks, Pub. L. No. 111-348, § 103(a)(1), 124 Stat. 3668,
3670 (2011); Shark Finning Prohibition Act, Pub. L. No.
106-557, § 3, 114 Stat. 2772 (2000).



(July     2011),   available   at    http://www.pcouncil.org/wp-
content/uploads/HMS-FMP-Jul11.pdf.
       CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                     7

    In 2011, after finding that shark finning nonetheless
continued to “cause[] tens of millions of sharks to die each
year,” thereby threatening a critical element of the ocean
ecosystem, and that “California is a market for shark fin”
that “helps drive the practice of shark finning,” 2011 Cal.
Legis. Serv. ch. 524, § 1(d), (f) (A.B. 376), the California
legislature passed the Shark Fin Law, which makes it a
misdemeanor to possess, sell, trade, or distribute detached
shark fins in California, see Cal. Fish & Game Code
§§ 2021(b), 12000.

                                C.

    The plaintiffs are associations whose members
previously engaged in cultural practices and commerce
involving shark fins. They claim that the Shark Fin Law is
preempted by the MSA because it interferes with federal
management of shark fishing in the EEZ, and with the
federal government’s prerogative to balance the various
statutory objectives of the MSA. They also claim the law
runs afoul of the dormant Commerce Clause by interfering
with commerce in shark fins between California and other
states, and by stemming the flow of shark fins through
California into the rest of the country.3

    In August 2012, the plaintiffs moved the district court
to preliminarily enjoin the enforcement of the Shark Fin
Law. The district court denied the motion, and we


 3
   The plaintiffs also claimed below that the Shark Fin Law violates
the Equal Protection Clause, but they abandoned this claim at oral
argument.
8       CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

affirmed, agreeing that the plaintiffs had failed to show a
likelihood of success on the merits of their preemption and
dormant Commerce Clause claims.4            See Chinatown
Neighborhood Ass’n v. Brown, 539 F. App’x 761, 762-63
(9th Cir. 2013) (mem.). On December 9, 2013, the
plaintiffs filed an amended complaint. The district court
granted the defendants’ motion to dismiss with prejudice on
March 24, 2014.




    4
    The federal government raised tentative preemption concerns in an
untimely amicus brief filed with this Court while the appeal from the
denial of the preliminary injunction was before us. See Chinatown
Neighborhood Ass’n v. Brown, 539 F. App’x 761, 763 (9th Cir. 2013)
(mem.). That brief relied in part on an NMFS notice of proposed
rulemaking—which proposed regulations that have not been adopted—
suggesting that under certain circumstances, the MSA would preempt
state laws that have the effect of regulating fishing within the EEZ. See
Magnuson-Stevens Act Provisions; Implementation of the Shark
Conservation Act of 2010, 78 Fed. Reg. 25,685, 25,687 (May 2, 2013).
We declined to consider the federal government’s position on
preemption in determining whether the district court had abused its
discretion in denying preliminary injunctive relief because that position
was first presented in an untimely amicus brief on appeal, but said that
the federal government could “rais[e] these arguments in the permanent
injunction proceedings.” Chinatown Neighborhood Ass’n, 539 F.
App’x at 763. The federal government did not file an amicus brief in
connection with the motion to dismiss or the present appeal, but the
defendants have submitted correspondence from the NMFS stating that
the Shark Fin Law “is not preempted by the Magnuson-Stevens Act, as
amended.” In light of our conclusions below, we need not rely on this
position.
        CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                         9

                                  II.

    We have jurisdiction over this appeal under 28 U.S.C.
§ 1291. We review a district court’s grant of a motion to
dismiss de novo, Cousins v. Lockyer, 

, 1067
(9th Cir. 2009), and the denial of leave to amend for abuse
of discretion, Toth v. Trans World Airlines, Inc., 

, 1385 (9th Cir. 1988).

                                  III.

    The MSA does not have an express preemption
provision. Even absent such a provision, however, a
federal statute has preemptive effect if it conflicts with state
law. This can occur when “compliance with both federal
and state regulations is a physical impossibility,” Fla. Lime
& Avocado Growers, Inc. v. Paul, 

, 142-43
(1963), or when a state law “stands as an obstacle to the
accomplishment and execution of the full purposes and
objectives of Congress,” Arizona v. United States, 132 S.
Ct. 2492, 2501 (2012).5 In assessing the preemptive force
of a federal statute, the purpose of Congress, as “discerned
from the language of the pre-emption statute and the
statutory framework surrounding it,” is the “ultimate
touchstone.” Medtronic, Inc. v. Lohr, 

, 485-86
(1996) (quotation marks omitted).



 5
   Under the doctrine of “field preemption,” state law is preempted if it
regulates “conduct in a field that Congress, acting within its proper
authority, has determined must be regulated by its exclusive
governance.” 

. The plaintiffs have
abandoned any claim of field preemption.
10    CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

    A presumption against preemption applies generally,
but is especially strong when, as here, “Congress has
legislated in a field which the states have traditionally
occupied.” McDaniel v. Wells Fargo Invs., LLC, 

, 674 (9th Cir. 2013); see also Bayside Fish Flour Co.
v. Gentry, 

, 426 (1936) (explaining the historic
control of states over fish in state waters); N.Y. State
Trawlers Ass’n v. Jorling, 

, 1309-10 (2d Cir.
1994) (“The interest of a state in regulating the taking of its
fish and wildlife resources has been long established.”).
Thus, the California statute cannot be set aside absent
“clear evidence” of a conflict. Geier v. Am. Honda Motor
Co., 

, 885 (2000); see also McClellan v. I-
Flow Corp., 

, 1039 (9th Cir. 2015) (“[T]he
historic police powers of the States were not to be
superseded unless that was the clear and manifest purpose
of Congress.” (alteration omitted)).

                              A.

     Although the plaintiffs argue the Shark Fin Law
interferes with the federal government’s authority under the
MSA to manage shark fishing in the EEZ, they do not
identify any “actual conflict between the two schemes of
regulation.” Fla. 

. To be sure, the
California statute restricts certain economically viable uses
for sharks that are lawfully harvested from the EEZ and
landed in California. But the MSA does not mandate that a
given quantity of sharks be harvested from the EEZ—and
even if it did, detached fins are not the only viable use for
harvested sharks. As the plaintiffs recognize, “[t]he use of
approximately 95% of any legally fished shark for shark
oil, shark meat, shark skin, etc. is still permitted” under the
California regime. The plaintiffs point to no “clear and
manifest” intent of Congress to preempt regulation such as
        CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                       11

the Shark Fin Law, 

; rather,
they have alleged nothing more than the prospect of a
“modest impediment” to general federal purposes, Pharm.
Research & Mfrs. of Am. v. Walsh, 

, 667
(2003). This does not suffice to overcome the presumption
against preemption. See Sprietsma v. Mercury Marine,

, 67 (2002) (finding no preemption in the
absence of conflict with an “authoritative message” from
Congress); P.R. Dep’t of Consumer Affairs v. Isla Petrol.
Corp., 

, 501 (1988) (same); Fla. 

(same).6




 6
     The cases relied upon by the plaintiffs that invalidate state
regulations with effects on fishing in the EEZ are unpersuasive because
in each case, the invalidated regulations either directly proscribed what
federal law affirmatively allowed, see A Fisherman’s 

(Fourth Circuit case finding preempted a city resolution
forbidding access to ports for vessels using longline tackle, which was
the only fishing method authorized by the applicable FMP), or directly
banned activity within the EEZ that was legal under federal law, see
Vietnamese Fishermen 

(concluding an
FMP permitted the use of gill nets in certain places within the EEZ, and
invalidating a California proposition banning the use of gill nets in the
EEZ); Bateman v. Gardner, 

, 597-98 (S.D. Fla. 1989)
(finding preempted a Florida statute that banned fishing in portions of
the EEZ where federal law allowed it), aff’d, 

(11th Cir.
1990) (mem.). In Southeast Fisheries Association v. Chiles, a case
cited in the dissent, the Eleventh Circuit suggested in dicta that state-
law daily quotas on landing Spanish Mackerel would interfere with a
federal annual quota on catch of that fish in the EEZ. 

,
1509-10 (11th Cir. 1992). There too, state law directly conflicted with
what federal law allowed.
12    CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

                             B.

    The plaintiffs emphasize that even when state and
federal purposes overlap, a conflict in the method of
achieving those purposes can be grounds for setting aside a
state law. See 

(“[C]onflict in
technique can be fully as disruptive to the system Congress
enacted as conflict in overt policy.”). They discern in the
MSA a balancing of competing objectives in fishery
management and a corresponding congressional intent to
preclude state legislation that promotes one of these
objectives—conservation—over others.          See, e.g., 

law preempted from interfering “with the
careful balance struck by Congress with respect to
unauthorized employment” of undocumented workers).

     The MSA indeed recognizes various competing values.
See 16 U.S.C. § 1801(b) (listing “conserv[ing] and
manag[ing] the fishery resources found off the coasts of the
United States,” “promot[ing] domestic commercial and
recreational fishing under sound conservation and
management principles,” and “encourag[ing] the
development by the United States fishing industry of
fisheries which are currently underutilized or not
utilized . . . in a non-wasteful manner” as objectives of the
MSA). Among them, however, conservation is paramount.
See Nat. Res. Def. Council, Inc. v. Nat’l Marine Fisheries
Serv., 

, 879 (9th Cir. 2005) (“The purpose of
the Act is clearly to give conservation of fisheries priority
over short-term economic interests.”); 

(“[U]nder the . . . [MSA], the Service must give
priority to conservation measures.”). Indeed, in the
particular context of shark fishing, the amendments to the
MSA addressing finning make the primacy of conservation
unambiguous. See 16 U.S.C. § 1857(1)(P). This is,
      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS               13

accordingly, not the rare circumstance in which a state law
interferes with a “deliberate effort to steer a middle path,”
Crosby v. Nat’l Foreign Trade Council, 

, 378
(2000) (quotation marks omitted), or to strike a “careful
balance,” 

.

    The MSA’s provision for broad state-level participation
in the implementation of the statutory objectives further
undermines any inference of interference with Congress’s
method. See, e.g., 16 U.S.C. § 1852(a)(2) (“Each [FMC]
shall reflect the expertise and interest of the several
constituent States in the ocean area over which such
Council is granted authority.”); see also 

(permitting FMPs to limit commerce in fish caught within
the EEZ “consistent with any applicable . . . State safety
and quality requirements”); 

(“[N]othing in
this chapter shall be construed as extending or diminishing
the jurisdiction or authority of any State within its
boundaries.”); 

(“The Fishery Act
was enacted to establish a federal-regional partnership to
manage fishery resources.”). Courts have found conflicts
between state and federal schemes with overlapping
purposes when the federal scheme is comprehensive and
exclusive, see, e.g., 

(immigration); 

(international
sanctions), but not when, as here, the federal scheme is
cooperative, see Wyeth v. Levine, 

, 575 (2009)
(“The case for federal pre-emption is particularly weak
where Congress has indicated its awareness of the
operation of state law in a field of federal interest, and has
nonetheless decided to stand by both concepts and to
tolerate whatever tension there is between them.”
(alteration omitted)); DeHart v. Town of Austin, Ind.,

, 722 (7th Cir. 1994) (“[G]iven the clear
14      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

expressions of Congressional intent to foster cooperation
with state and local governments and the different, albeit
overlapping, purposes behind the [federal] Act and the . . .
Ordinance, we discern no Congressional intent to ban state
or local legislation . . . .”).

                                   C.

    The plaintiffs’ attempt to draw a negative inference
from Congress’s failure in the MSA to address on-land
activities related to finning, see 18 U.S.C. § 1857(1)(P)
(referring to activities at sea, aboard fishing vessels, and
during landing), is similarly meritless. Silence, without
more, does not preempt—“a clear and manifest purpose of
pre-emption is always required.” Isla 

(quotation marks omitted). There is no “authoritative
federal determination” that on-land activities are “best left
unregulated.” Id.7 To the contrary, the federal scheme


 7
    The plaintiffs rely on regulations that limit the circumstances under
which sharks may be sold on land. See 50 C.F.R. § 635.31(c)(1), (5).
But these regulations limit, rather than encourage, commerce in sharks.
Cf. 16 U.S.C. § 1853(b)(3) (permitting FMPs to “establish specified
limitations which are necessary and appropriate for the conservation
and management of the fishery on the . . . sale of fish caught during
commercial, recreational, or charter fishing” (emphasis added)). The
plaintiffs also rely on a statement by Representative George Miller
during floor debates on the federal finning prohibition act that the “Act
will not prevent United States fishermen from harvesting sharks,
bringing them to shore, and then using the fins or any other part of the
shark.” 146 Cong. Rec. H11571 (Oct. 30, 2000). But a lone statement
in the legislative history is not a “clear and manifest” expression of
Congress’s intent to preempt, and in any event, this statement merely
describes the limits of federal law.
      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS               15

expressly preserves the ability of states to regulate fishing-
related activities within their boundaries. See 16 U.S.C.
§ 1856(a)(1).

                             D.

     The plaintiffs amended their original complaint after we
remanded the case upon affirming the denial of a
preliminary injunction. At the hearing on the motion to
dismiss the amended complaint, the district court asked
plaintiffs’ counsel during the discussion of the preemption
claim whether “you’ve got the complaint where you want
it,” and counsel responded affirmatively. Based on this
representation, the court found that a second round of
amendments would be futile and granted the motion to
dismiss with prejudice.

    The plaintiffs assert for the first time on appeal that
they could plead additional facts to support the preemption
claim, and ask us to find that the district court abused its
discretion in failing to grant leave sua sponte. Even
making the charitable assumption that this argument was
preserved for appeal, see Alaska v. United States, 

, 1163-64 (9th Cir. 2000) (“Where a party does not ask
the district court for leave to amend, the request on appeal
to remand with instructions to permit amendment comes
too late.” (alterations and quotation marks omitted));
Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 

,
749 (9th Cir. 2006) (relying on Alaska for the proposition
that “we generally will not remand with instructions to
grant leave to amend unless the plaintiff sought leave to
16      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

amend below”), we cannot conclude on this record that the
district court abused its discretion in dismissing with
prejudice.8

    “Although leave to amend ‘shall be freely given when
justice so requires,’ it may be denied if the proposed
amendment either lacks merit or would not serve any
purpose because to grant it would be futile in saving the
plaintiff’s suit.” Universal Mortg. Co. v. Prudential Ins.
Co., 

, 459 (9th Cir. 1986) (quoting Fed. R.
Civ. P. 15(a)). The first amended complaint makes no
allegations of a direct conflict between the California
statute and any unambiguous federal mandate. At oral
argument on this appeal, plaintiffs’ counsel asserted that
the plaintiffs could remedy this defect by alleging that state
bans on commerce in shark fins affect the ability of
commercial fishers to reap the optimum yields prescribed
in FMPs for shark harvests. But the MSA does not preempt
a state law simply because it may affect the realization of
optimum yields—if that were so, a wide array of state
regulations affecting commercial fishing, such as taxes or
labor laws, would be potentially suspect. Indeed, Congress
expressly foreclosed any interpretation of optimum yield
that would have such a broad preemptive effect by




 8
    The dissent correctly notes the “strong showing” required in the
district court to justify dismissal with prejudice, but ignores the
deferential abuse-of-discretion standard governing our review of the
district court’s failure to grant leave to amend. At the very least, it is
even more difficult to perceive an abuse of discretion when the
plaintiffs never sought leave to amend below.
        CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                             17

preserving state jurisdiction over commerce in fish
products within state borders. See 16 U.S.C. § 1856(a)(1).

    The plaintiffs concede that no provision of federal law
affirmatively guarantees the right to use or sell shark fins
onshore, and they do not dispute that there are
commercially viable uses for sharks besides their detached
fins. That resolves the preemption issue. See Fla. 

(“[W]e are not to conclude that
Congress legislated the ouster of this California statute . . .
in the absence of an unambiguous congressional mandate to
that effect.”). Leave to amend would therefore be futile.
Cf. ReadyLink Healthcare, Inc. v. State Comp. Ins. Fund,

, 761-62 (9th Cir. 2014) (“Preemption is
almost always a legal question, the resolution of which is
rarely aided by development of a more complete factual
record.” (quotation marks omitted)).9

                                     IV.

   “The Supreme Court has adopted a two-tiered approach
to analyzing state economic regulation under the



  9
    Our conclusion is bolstered by the posture in which the request to
amend was made. The original complaint was filed three years ago,
since then, there has been ample opportunity to explore the scope of the
preemption claim, including in litigating the preliminary injunction and
the appeal from the denial of the preliminary injunction. The plaintiffs
had the benefit of this litigation, and its resolution, before filing the first
amended complaint. Cf. AmerisourceBergen Corp. v. Dialysist W.,
Inc., 

, 953-54 (9th Cir. 2006) (affirming denial of leave to
amend based on delay between learning of basis for amendment and
seeking leave).
18    CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

Commerce Clause.” Ass’n des Eleveurs de Canards et
d’Oies du Quebec v. Harris, 

, 948 (9th Cir.
2013) (quotation marks omitted), cert. denied, 

(2014). If a state statute “directly regulates or
discriminates against interstate commerce, or . . . its effect
is to favor in-state economic interests over out-of-state
interests,” it is “struck down . . . without further inquiry.”
Brown-Forman Distillers Corp. v. N.Y. State Liquor Auth.,

, 579 (1986). When, however, a state statute
has only indirect effects on interstate commerce and
regulates evenhandedly, it violates the Commerce Clause
only if “the burdens of the statute so outweigh the putative
benefits as to make the statute unreasonable or irrational.”
UFO Chuting of Haw., Inc. v. Smith, 

, 1196
(9th Cir. 2007) (alteration omitted).

                             A.

    The plaintiffs claim the Shark Fin Law is per se invalid
under the Commerce Clause because it regulates
extraterritorially by curbing commerce in shark fins
between California and out-of-state destinations, and by
preventing the flow of shark fins through California from
one out-of-state destination to another. But a state may
regulate commercial relationships “in which at least one
party is located in California.” Gravquick A/S v. Trimble
Navigation Int’l, Ltd., 

, 1224 (9th Cir. 2003).
And even when state law has significant extraterritorial
effects, it passes Commerce Clause muster when, as here,
those effects result from the regulation of in-state conduct.
See Rocky Mtn. Farmers Union v. Corey, 

,
1101-04 (9th Cir. 2013) (upholding California statute
imposing fuel standards that affect out-of-state fuel
producers because the standard applies only to fuels
consumed in California), cert. denied, 

      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS               19

(2014); Ass’n des 

(upholding
California statute banning sale of products from force-fed
birds, even though it affected out-of-state producers and
exports from California); cf. Sam Francis Found. v.
Christies, 

, 1323-24 (9th Cir. 2015) (en banc)
(invalidating a California statute that “facially regulates a
commercial transaction that takes place wholly outside of
the State’s borders” (quotation marks omitted)). Thus,
nothing about the extraterritorial reach of the Shark Fin
Law renders it per se invalid.

    The plaintiffs’ reliance on Healy v. Beer Institute,
Brown-Forman Distillers Corp. v. New York State Liquor
Authority, and Baldwin v. G.A.F. Seelig, Inc. is misplaced.
In each of those cases, the Supreme Court struck down
price-control or price-affirmation statutes that had the
effect of preventing producers from pricing products
independently in neighboring states. See Healy, 

, 326, 334 (1989) (Connecticut statute requiring beer
distributors to affirm that Connecticut prices were at least
as low as prices in other states); 

, 582-83 (New York statutes barring distillers from
selling liquor at prices higher than prices in other states);
Baldwin, 

, 521-22 (1935) (New York statute
prohibiting sale of milk in New York if acquired from
Vermont farmers at price lower than price available to New
York farmers). We have recognized the sui generis effect
on interstate commerce of such price-control regimes and
the correspondingly limited scope of these cases. See Ass’n
des 

(“Healy and Baldwin are not
applicable to a statute that does not dictate the price of a
product and does not tie the price of its in-state products to
out-of-state prices.” (alteration and quotation marks
omitted) (quoting 

)). The Shark Fin
20    CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

Law does not fix prices in other states, require those states
to adopt California standards, or attempt to regulate
transactions conducted wholly out of state, and the price-
control cases are therefore inapposite. See Rocky 

.

                             B.

    The plaintiffs claim that even if the Shark Fin Law is
not an impermissible direct regulation of extraterritorial
conduct, it should be struck down under Pike v. Bruce
Church, Inc., because “the burden [it] impose[s] on
[interstate] commerce is clearly excessive in relation to the
putative local benefits.” 

, 142 (1970). Our
precedents, however, preclude any judicial “assessment of
the benefits of [a state] law[] and the . . . wisdom in
adopting” it unless the state statute either discriminates in
favor of in-state commerce or imposes a “significant
burden on interstate commerce.”              Nat’l Ass’n of
Optometrists & Opticians v. Harris, 

, 1156
(9th Cir. 2012); see also Ass’n des 

-52. Here, the plaintiffs do not allege the Shark Fin
Law has any discriminatory effect, and they cannot
establish a significant burden on interstate commerce.

    “[O]nly a small number of . . . cases invalidating laws
under the dormant Commerce Clause have involved laws
that were genuinely nondiscriminatory . . . .” Nat’l Ass’n of

(quotation marks omitted).
These cases address state “regulation of activities that are
inherently national or require a uniform system of
regulation,” 

typically, interstate
transportation, see, e.g., Raymond Motor Transp., Inc. v.
Rice, 

, 447-48 (1978) (state regulation of truck
length); see also Ass’n des 

      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                21

(“[E]xamples of courts finding uniformity necessary fall
into the categories of transportation or professional sports
leagues.” (alteration and quotation marks omitted)).

    The Shark Fin Law does not interfere with activity that
is inherently national or that requires a uniform system of
regulation. The purpose of the Shark Fin Law is to
conserve state resources, prevent animal cruelty, and
protect wildlife and public health. See 2011 Cal. Legis.
Serv. ch. 524, § 1 (A.B. 376) (listing purposes). These are
legitimate matters of local concern. See, e.g., Merrifield v.
Lockyer, 

, 986 (9th Cir. 2008); UFO 

. And to the extent the Shark Fin Law is
effectively a means of ocean fishery management, fishery
management is an inherently cooperative endeavor—with
state and federal jurisdiction over the oceans divided
according to distance from shore, see 16 U.S.C.
§§ 1802(11), 1811(a), 1856(a)(1), and with state and
federal cooperation contemplated even in the management
of federal waters, see, e.g., 

There is,
accordingly, no significant interference with interstate
commerce. See Ass’n des 

; Nat’l
Ass’n of 

.

    “Because the [Shark Fin Law does] not impose a
significant burden on interstate commerce, it would be
inappropriate for us to determine [its] constitutionality . . .
based on our assessment of the benefits of th[e] law[] and
the State’s wisdom in adopting [it],” or the availability of
less-burdensome alternatives. Nat’l Ass’n of 

-57; see also Ass’n des Eleveurs, 

     CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

at 952 (finding an inquiry into “whether the benefits of the
challenged laws are illusory” unwarranted because the
regulation of the foie gras market is not inherently
national).10

                                  V.

      We AFFIRM the judgment of the district court.




 10
    Because none of the plaintiffs’ constitutional claims survive the
motion to dismiss, the district court properly dismissed the claim under
42 U.S.C. § 1983. See West v. Atkins, 

, 48 (1988).
REINHARDT, Circuit Judge, dissenting in part:

    I dissent in part because the plaintiffs must be granted
leave to amend the complaint with respect to their
preemption claim.1 “[I]n a line of cases stretching back
nearly 50 [now 65] years, we have held that in dismissing
for failure to state a claim under Rule 12(b)(6), ‘a district
court should grant leave to amend even if no request to
amend the pleading was made, unless it determines that the
pleading could not possibly be cured by the allegation of
other facts.’” Lopez v. Smith, 

, 1127 (9th Cir.
2000) (emphasis added) (citations omitted); see also
Sharkey v. O’Neal, 

, 774 (9th Cir. 2015). In
my view, the defects in plaintiffs’ preemption claim could
be cured by amendment, and the majority’s other suggested
reasons for affirming the denial of leave to amend are also
without merit.

    The majority first states in dictum that the issue of the
denial of leave to amend the complaint may have been
waived. As the foregoing statement of the law regarding
dismissals with prejudice makes clear, however, whether
the plaintiffs asked the district court for leave to amend is
irrelevant. The majority incorrectly suggests that Alaska v.
United States, 

, 1163–64 (9th Cir. 2000),
broadly held that a party cannot raise the issue for the first
time on appeal, Maj. Op. at 15-16, but that case neither
considered nor abrogated our longstanding rule regarding
dismissals under Rule 12(b)(6). Rather, it merely held that



 1
    The plaintiffs do not contest the denial of leave to amend with
respect to their Commerce Clause claim on this appeal.
24    CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

the government could not seek to amend its answer to the
complaint on appeal from judgment on the pleadings where
it had intentionally adopted its answer as a strategic
litigating position. See 

. In so
doing, Alaska relied on cases holding that a party cannot
wait until an appeal of summary judgment to seek leave to
amend a pleading, 

rule that makes sense
in light of the time and expense that a disposition at that
stage entails. By contrast, there is a strong presumption that
a plaintiff with a plausible legal claim who simply fails to
master the art of the well-pleaded complaint must be
allowed to cure pleading defects—whether or not it makes
a request to do so before the district court.

    The majority also alludes in dictum to the fact that the
plaintiffs voluntarily amended their complaint on one prior
occasion and that it has been three years since the original
complaint was filed. True, the presumption that a dismissal
should be without prejudice may be rebutted by a finding of
“undue delay, bad faith or dilatory motive . . . , repeated
failure to cure deficiencies by amendments previously
allowed, [or] undue prejudice to the opposing party by
virtue of allowance of the amendment . . . .” 

(internal citation and quotations marks
omitted). However, absent prejudice to the opposing
party—which the district court did not find and the
defendants do not assert—there must be a “strong
showing” of one of the other factors to justify a dismissal
with prejudice. 

and citation omitted).
A single, good-faith prior amendment of the complaint
cannot satisfy this high bar. Nor can the mere passage of
        CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                         25

time.2 More important, the district court relied solely on the
purported futility of an amendment. We cannot affirm
based on a finding of repeated failure to cure or undue
delay that the district court did not make. See 

the district court must provide an explanation for
dismissal with prejudice).

    Nor are the majority and the district court correct that
the plaintiffs’ pleading defects could not possibly be cured
by amendment. I agree that the plaintiffs’ complaint as
currently drafted fails to “identify any actual conflict
between” the Shark Fin Law and “the federal government’s
authority under the [Magnuson-Stevens Act] to manage
shark fishing in the [exclusive economic zone].” Maj. Op.
at 10 (quotation marks omitted). It includes nothing beyond
“mere conclusory statements,” Ashcroft v. Iqbal, 

, 678 (2009), that the Shark Fin Law conflicts with “the
[Magnuson-Stevens Act], federal implementing regulations
and federal [Fisheries Management Plans].” First Amended
Complaint for Declaratory and Injunctive Relief at 12 ¶ 57,
Chinatown Neighborhood Ass’n v. Harris, No. CV 12-
03759 WHO (N.D. Cal. Dec. 9, 2013). However, the



 2
    This case is not akin to AmerisourceBergen Corp. v. Dialysist W.,
Inc., cited by the majority, in which the district court found that the
defendant would be prejudiced by the plaintiff’s attempt “twelve
months into the litigation, . . . [to] drastically change[ ] its litigation
theory” without explanation. 

, 953 (9th Cir. 2006). As
explained below, the problem with the operative complaint in this case
could be cured by the pleading of additional facts; unlike in
AmerisourceBergen, the plaintiffs do not seek to change their strategy
altogether.
26     CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

plaintiffs assert that, if permitted to amend the complaint,
they could plead additional facts demonstrating that (1) the
federal government has adopted specific quotas for shark
fishing pursuant to the optimum yield provisions of the
Magnuson-Stevens Act and that (2) the Shark Fin Law
poses an obstacle to achievement of those quotas because it
significantly reduces otherwise legal shark fishing.3 As
outlined below, if such facts were properly pleaded, this
would constitute a plausible claim for relief.

    As relevant here, conflict preemption occurs where “the
challenged state law ‘stands as an obstacle to the
accomplishment and execution of the full purposes and
objectives of Congress,’” Arizona v. United States, 132 S.
Ct. 2492, 2501 (2012), including where it “would interfere
with the careful balance struck by Congress,” 

A
central purpose and objective of the Magnuson-Stevens Act
is to “achieve and maintain, on a continuing basis, the
optimum yield from each fishery,” 16 U.S.C. § 1801(b)(4),
which is the “amount of fish which — (A) will provide the
greatest overall benefit to the Nation, particularly with
respect to food production and recreational opportunities,
and taking into account the protection of marine
ecosystems; [and] (B) is prescribed on the basis of the
maximum sustainable yield from the fishery . . . .” 

As the majority explains, the Magnuson-
Stevens Act creates a framework under which regional


 3
    Federal law bans the inhumane practice of shark finning—of
removing the fin from a shark on a boat—but it does not prohibit the
landing of an intact shark carcass or the subsequent detachment and
sale of a fin. See 16 U.S.C. § 1857(1)(P).
      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS               27

Fishery Management Councils comprised of federal and
state stakeholders collaborate to adopt Fishery Management
Plans designed to achieve optimum yield. 

In
short, Fishery Management Plans seek to maximize the
commercial and recreational benefits of fisheries in the
exclusive economic zone without compromising the long-
term sustainability of them. See id.; Natural Res. Def.
Council, Inc. v. Daley, 

, 753 (D.C. Cir. 2000).

      One of the things a Fishery Management Plan may do
to achieve optimum yield is establish a quota for the
amount of a particular species of fish that should be caught.
A plaintiff states a cognizable preemption claim where a
Fishery Management Plan has established such a quota and
a state law interferes with the achievement of that quota.
Se. Fisheries Ass’n v. Chiles, 

, 1510 (11th
Cir. 1992) (holding that the plaintiffs stated a cognizable
preemption claim where a Fishery Management Plan
established an annual quota for the total catch of Spanish
Mackerel while state law established a daily limit on the
number of Spanish Mackerel that a commercial vessel
could bring into a state port). Notwithstanding the
majority’s statement to the contrary, the Magnuson-Stevens
Act provision that preserves a state’s “jurisdiction or
authority . . . within its boundaries,” 16 U.S.C. § 1856(a)(1)
(emphasis added), does not authorize a state to adopt laws
that pose an obstacle to the federal government’s authority
to manage and maximize the productivity of fisheries
within its own respective territory, see 

(“the
United States claims, and will exercise . . . sovereign rights
and exclusive fishery management authority over all fish
. . . within the exclusive economic zone.”). See also City of
Charleston v. A Fisherman’s Best, 

, 174–76,
179 (4th Cir. 2002) (holding that city resolution banning
28      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

vessels that use longline tackle from docking at city marina
was preempted by Fishery Management Plan designating
“longline” as the authorized gear for catching swordfish).

    Although the plaintiffs’ pleadings as presently drafted
fail to point to a Fishery Management Plan regulating
sharks or setting a shark quota, at oral argument defendants
and their amicus curiae admitted that there are a number of
Fishery Management Plans in place around the country that
do so. Even if those Fishery Management Plans are silent
with regard to the sale of shark fins (as the defendants and
their amici represented at oral argument), the plaintiffs
could establish that the Shark Fin Law is preempted by
adducing clear evidence that it poses an obstacle to the
achievement of an optimum yield of sharks specified in an
Fishery Management Plan because it results in a significant
decrease in otherwise legal shark fishing. The plaintiffs
asserted at oral argument that if permitted to amend their
complaint, they would provide additional facts
demonstrating that the number of sharks caught in the
exclusive economic zone has dropped significantly and that
they have lost millions in revenue due to the Shark Fin
Law.4 If the fin is the main part of a shark that has



 4
    The plaintiffs did not, as the majority contends, concede that “there
are commercially viable uses for sharks besides their detached fins.”
Maj. Op. at 17. The majority improperly relies on two statements in
the record to hold that the plaintiffs conceded the matter. First, it cites
plaintiffs’ counsel’s statement at oral argument that a letter from the
Director of the California Department of Fish and Wildlife was not a
“big deal.” That letter states that “revenue from the sale of sharks
harvested in federal waters off California derives mostly from the sale
        CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS                        29

commercial value and thus California fishermen largely
cease catching sharks in exclusive economic zone fisheries,
the federal objective of achieving optimum yield might be
unconstitutionally impaired by the state’s ban on the sale of
fins—i.e., the balance between conservation and economic
interests struck by the Fishery Management Council in
adopting a quota could be upset. While I express no
opinion on the likelihood that such a claim would
ultimately succeed on the merits, the command that “leave
to amend shall be freely given” requires that the plaintiffs
at least be given a chance to adequately plead their claim.

(citation omitted).

    Finally, the majority’s assertion that in dismissing the
complaint with prejudice the district court properly relied
on a representation by the plaintiffs that amendment would
be futile is erroneous. The comment on which the majority
and the district court rely is ambiguous at best. In response
to the district court’s inquiry, “you’ve got the complaint


of the meat of the shark, not from the sale of fins after the shark is
legally harvested and landed with fins naturally attached.” Although
that assertion may indeed prove true, our job at the motion to dismiss
stage is to test the sufficiency of the plaintiffs’ allegations. We cannot
simply accept as true a state government official’s position regarding a
factual matter.

     Second, the majority relies on a footnote in the operative complaint
stating that “[t]he use of approximately 95% of any legally fished shark
. . . is still permitted.” This statement, however, says nothing about the
relative commercial value of the parts of a shark or whether the ban on
the sale of sharks is an obstacle to the achievement of optimum yield—
matters that involve factual questions that cannot be decided against the
plaintiffs at the motion to dismiss stage.
30      CHINATOWN NEIGHBORHOOD ASS’N V. HARRIS

where you want it . . . ?”, plaintiffs’ counsel responded
“you are correct.” Counsel likely meant only that he
believed that he had made sufficient averments to support
the claims at the motion to dismiss stage, as the district
court’s inquiry followed counsel’s lengthy argument to that
effect. This is different from a representation that should
the district court conclude that the allegations in the
complaint were insufficient, the plaintiffs could not provide
further allegations. The district court and the majority err
by treating counsel’s ambiguous representation as sufficient
to dislodge “the presumption in favor of granting leave to
amend.” 

have taken little effort by the district
court to clarify the matter before permanently depriving the
plaintiffs of an opportunity to pursue their case.

     I respectfully dissent.