Christina Reiss, Chief Judge, United States District Court.
Plaintiffs filed this action seeking relief pursuant to the Sherman Act, 15 U.S.C. §§ 1-2, for alleged antitrust violations committed by Defendants Dairy Farmers of America, Inc. ("DFA") and Dairy Marketing Services, LLC ("DMS"). Plaintiffs, who refer to themselves as "Farmers United," are more than 115 dairy farmers who opted out of a settlement approved by the court in a class action styled Allen v. Dairy Farmers of America, Inc., No. 5:09-cv-230 (the "Class Action").
Pending before the court is Defendants' motion to dismiss Plaintiffs' First Amended Complaint for Lack of Antitrust Standing (Doc. 16). Following oral argument on May 2, 2017, the court granted Plaintiffs leave to file a Revised First Amended Complaint ("RFAC") (Doc. 29), which they timely filed on May 23, 2017. Defendants filed a post-hearing memorandum renewing their motion to dismiss on June 13, 2017, whereupon the court took the motion under advisement.
Defendants contend they are entitled to dismissal because Plaintiffs have failed to allege antitrust injury as a matter of law under the Second Circuit's recent decision in In re Aluminum Warehousing Antitrust Litigation, 833 F.3d 151 (2d Cir. 2016) ("Aluminum Warehousing"). In the alternative, Defendants assert that each Plaintiff fails to plausibly allege antitrust standing with respect to their monopolization and monopsonization claims, and that four Plaintiffs, who have not supplied milk either to DMS or to any alleged co-conspirator, have failed to establish antitrust standing to assert any claims.
Plaintiffs oppose dismissal, asserting that they have plausibly alleged antitrust standing, Aluminum Warehousing is easily distinguished, and they have only asserted claims that survived summary judgment in the Class Action.
Plaintiffs are represented by Dana A. Zakarian, Esq., Elizabeth A. Reidy, Esq., Gary L. Franklin, Esq., Joel G. Beckman, Esq., and William C. Nystrom, Esq. Defendants are represented by Alfred C. Pfeiffer, Jr., Esq., Elyse M. Greenwald, Esq., Ian P. Carleton, Esq., Jennifer L. Giordano, Esq., Margaret M. Zwisler, Esq., and W. Todd Miller, Esq.
The following factual allegations are derived from the RFAC. Plaintiffs operate in Federal Milk Marketing Order 1 ("Order 1"), which covers areas in Delaware, the District of Columbia, Connecticut, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, and Virginia. Each Plaintiff is "either:"
(RFAC ¶ 14a.)
Exhibit A to the RFAC includes the following information regarding each Plaintiff, for all or part of the years 2005 to the present: (1) their name and address; (2) farm name; (3) the cooperative(s) of which they are or were a member; and (4) the processors buying their milk. Exhibit A also purports to identify the factual basis for each Plaintiffs antitrust standing by designating whether they are: (1) current or former members of DFA; (2) current or former suppliers to DMS; (3) current or former suppliers to a co-conspirator (and the name of the co-conspirator); and/or (4) current or former competitors of DFA/DMS.
Although Defendants criticize the lack of detail set forth in Exhibit A, they neither claim it prevents them from having sufficient notice to respond to Plaintiffs' claims, nor seek a more definite statement. See Salahuddin v. Cuomo, 861 F.2d 40, 42 (2d Cir. 1988) (explaining that "the principal function of pleadings under the Federal Rules is to give the adverse party fair notice of the claim asserted so as to enable him to answer and prepare for trial"); see also Todd v. Exxon Corp., 275 F.3d 191, 198 (2d Cir. 2001) ("No heightened pleading requirements apply in antitrust cases."); Dayton Superior Corp. v. Marjam Supply Co., 2011 WL 710450, at *8 (E.D.N.Y. Feb. 22, 2011) (stating that "antitrust allegations are governed by the notice pleading requirements contained in Federal Rule of Civil Procedure 8(a)") (alterations and internal quotation marks omitted).
Plaintiffs allege that DFA, a vertically integrated not-for-profit cooperative, is the largest dairy cooperative in the United States, with over 14,000 dairy producers, including 2,446 member farms in the Northeast United States. It is also allegedly the largest milk processor in the world and hauls, processes, bottles, and distributes raw Grade A milk. DMS is a limited liability company which was established in 1999 through an agreement between DFA and Dairylea Cooperative Inc. ("Dairylea") and is currently owned by DFA and St. Albans Cooperative Creamery, Inc. As a milk-marketing agency, it markets milk for over 5,500 farms throughout the Northeast "even though DMS received no authorization from independent dairy farmers to do so." (RFAC ¶ 16.) "Upon information and belief," DMS markets approximately 50% of the raw Grade A milk in the Northeast. Id.
Plaintiffs allege that Defendants, in concert with Dairylea, Agri-Mark Family Dairy Farms ("Agri-Mark"), members of the Greater Northeast Milk Marketing Agency ("GNEMMA"), Farmland Dairies LLC, National Dairy Holdings LLC ("NDH"), HP Hood LLC ("Hood"), and other known and unknown co-conspirators, "have engaged in an illegal conspiracy to restrain competition, fix and suppress
In adjudicating a motion pursuant to Fed. R. Civ. P. 12(b)(6), the court is "guided by `[t]wo working principles[.]'" Harris v. Mills, 572 F.3d 66, 72 (2d Cir. 2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)) (alteration in original). First, "a court must accept as true all of the [factual] allegations contained in a complaint[,]" a "tenet" that is, however, "inapplicable to legal conclusions." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937. "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. Second, "only a complaint that states a plausible claim for relief survives a motion to dismiss" and a claim "has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. at 678-79, 129 S.Ct. 1937.
"The plausibility standard is not akin to a `probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. at 678, 129 S.Ct. 1937 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). "Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement to relief." Id. (internal quotation marks omitted). "Determining whether a complaint states a plausible claim for relief will[]... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679, 129 S.Ct. 1937.
To maintain an action, "[a]n antitrust plaintiff must show both constitutional standing and antitrust standing." Gelboim v. Bank of Am. Corp., 823 F.3d 759, 770 (2d Cir. 2016). Antitrust standing is "a threshold, pleading-stage inquiry and when a complaint by its terms fails to establish this requirement [the court] must dismiss it as a matter of law." Gatt Commc'ns, Inc. v. PMC Assocs., L.L.C., 711 F.3d 68, 75 (2d Cir. 2013) (internal quotation marks omitted). To establish antitrust standing, a plaintiff must satisfy "two imperatives[.]" Id. at 76.
First, the plaintiff must allege antitrust injury, which is "injury of the type the antitrust laws were intended to prevent and that flows from that which makes defendants' acts unlawful." Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489, 97 S.Ct. 690, 50 L.Ed.2d 701 (1977). To determine whether Plaintiffs plausibly allege antitrust injury, the court must "evaluate the plaintiffs harm, the alleged wrongdoing by the defendants, and the relationship between them." Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 519, 535, 103 S.Ct. 897, 74 L.Ed.2d 723 (1983) ("AGC"); Port Dock & Stone Corp. v. Oldcastle Ne., Inc., 507 F.3d 117, 122 (2d Cir. 2007) (stating that "[t]he necessary `antitrust injury' is an injury attributable to the anticompetitive aspect of the practice under scrutiny").
Defendants rely on the Second Circuit's recent decision in Aluminum Warehousing for the proposition that dismissal is required because Plaintiffs allege their injuries occurred in a separate and distinct market from the one in which Defendants allegedly engaged in anti-competitive conduct. They argue this case "remains a tale of two markets: (1) the market for the purchase of raw Grade A milk from farmer-producers, like plaintiffs (the `producer market'), and (2) the market for the sale of raw Grade A milk to processors, like Dean and Hood (the `processor market')." (Doc. 16-1 at 7.) Plaintiffs counter that they have plausibly alleged a single market in which both they and Defendants participate, in which Defendants' anticompetitive conduct occurred, and in which Plaintiffs sustained their injuries.
In Aluminum Warehousing, the plaintiffs (three groups of end-users of aluminum referred to as "Purchasers," "Commercials," and "Consumers") alleged that the defendants manipulated the price of aluminum in the Detroit metropolitan area by artificially increasing the cost of storing aluminum in London Metal Exchange ("LME") warehouses. As a result, the Purchasers paid a higher price for aluminum and then "passed that inflated cost to downstream purchasers of aluminum like Commercials, and eventually, Consumers." 833 F.3d at 156. However, Commercials and Consumers "disavow[ed] participation in any of the markets in which the defendants operate." Id. at 161-62 (stating that they "did not store aluminum in the defendants' warehouses; they did not trade aluminum futures contracts with the defendants; and they do not allege that any of the aluminum they purchased was ever stored in any of the defendants' warehouses, or was the underlying asset for any of the defendants' futures trades").
The Second Circuit affirmed the district court's conclusion that Commercials and Consumers "lack[ed] antitrust standing on the ground that they did not (and could not) suffer antitrust injury[,]" id. at 154, explaining that:
Id. at 161. The court held that the allegedly anti-competitive conduct "took place (if
District courts within the Second Circuit applying Aluminum Warehousing have evaluated whether the putative plaintiffs allege "participa[tion] in the very market that is directly restrained." Id. at 161. In some of these cases, as in Aluminum Warehousing, the plaintiffs conceded that they did not participate in the same market as the defendant. See, e.g., Harry v. Total Gas & Power N. Am., Inc., 244 F.Supp.3d 402, 419-20 (S.D.N.Y. 2017) (granting motion to dismiss and rejecting plaintiffs' "argu[ment] that they need not have participated in the precise market in which the anticompetitive conduct is alleged to have occurred"); NYPL v. JPMorgan Chase & Co., 2017 WL 1133446, at *5 (S.D.N.Y. Mar. 24, 2017) (granting motion to dismiss on the grounds that "Plaintiffs admitted in their opposition ... that the FX spot market is `completely different' from the end-user market" and that "any injury Plaintiffs suffered was in a market separate from the one that Defendants allegedly manipulated, and therefore does not qualify as an antitrust injury").
Here, in contrast, Plaintiffs allege a single market for raw Grade A milk in which both they and Defendants participate.
Defining a relevant market is a fact-dependent inquiry generally ill-suited for the motion to dismiss phase. See Todd, 275 F.3d at 199-200 (stating that "[b]ecause market definition is a deeply fact-intensive inquiry, courts hesitate to grant motions to dismiss for failure to plead a relevant ... market"). As the United States Court of Appeals for the Ninth Circuit observed:
Knevelbaard Dairies v. Kraft Foods, Inc., 232 F.3d 979, 989 (9th Cir. 2000) (citation omitted).
Plaintiffs' monopolization claims allege:
(Doc 21 at 21-22 (quoting RFAC ¶ 49)) (emphasis in original).
PepsiCo, Inc. v. Coca-Cola Co., 315 F.3d 101, 105 (2d Cir. 2002) (quoting United States v. Grinnell Corp., 384 U.S. 563, 570-71, 86 S.Ct. 1698, 16 L.Ed.2d 778 (1966)).
"To state an attempted monopolization claim, a plaintiff must establish `(1) that the defendant has engaged in predatory or anticompetitive conduct with (2) a specific intent to monopolize and (3) a dangerous probability of achieving monopoly power.'" Id. (quoting Spectrum Sports, Inc. v. McQuillan, 506 U.S. 447, 456, 113 S.Ct. 884, 122 L.Ed.2d 247 (1993)). "The elements of a conspiracy to monopolize are (1) proof of a concerted action deliberately entered into with the specific intent to achieve an unlawful monopoly, and (2) the commission of an overt act in furtherance of the conspiracy." Int'l Distrib. Ctrs., Inc. v. Walsh Trucking Co., 812 F.2d 786, 795 (2d Cir. 1987) (internal quotation marks omitted).
Defendants contend that Plaintiffs' monopolization claims must be dismissed for failure to satisfy both prongs of antitrust standing because they have not plausibly alleged antitrust injury and because suppliers to an alleged monopolist cannot be efficient enforcers of the antitrust laws. The court "ascertain[s] antitrust injury only by identifying the anticipated anticompetitive effect of the specific practice at issue and comparing it to the actual injury the plaintiff alleges." Port Dock, 507 F.3d at 122.
In this case, Plaintiffs allege Defendants' alleged anticompetitive practices include a series of mergers with and acquisitions of milk cooperatives and processors, full-supply agreements, non-solicitation
"The danger to customers from monopolization of the production level is the danger that the monopolist will raise prices and restrict output." Id. at 123; see also Nat'l Collegiate Athletic Ass'n v. Bd. of Regents of Univ. of Okla., 468 U.S. 85, 107-08, 104 S.Ct. 2948, 82 L.Ed.2d 70 (1984) ("Restrictions on price and output are the paradigmatic examples of restraints of trade that the Sherman Act was intended to prohibit.").
Port Dock, 507 F.3d at 123. "Dealers in this situation lack standing because their particular injury was not caused by an exercise of the defendant's newly acquired power to raise prices." Id.; see also Dyer v. V.P. Records Retail Outlet, Inc., 2008 WL 2876494, at *6 (S.D.N.Y. July 24, 2008) ("A plaintiff also lacks standing if its injury does not arise from monopolization-i.e., if the defendant's power to raise prices or restrict output does not cause the plaintiffs injury.").
The RFAC is bereft of factual allegations that Defendants' alleged monopolistic conduct has resulted in increased prices. In their opposition brief, Plaintiffs identify only one allegation of antitrust injury related to Defendants' alleged monopolization: "DFA and DMS are able to reduce the supply base for/output of raw Grade A milk." (Doc. 21 at 22 n.17 (citing RFAC ¶ 94) (internal quotation marks omitted).) This conclusory statement falls short of plausibly alleging that the output of raw grade A milk has actually been reduced or that Plaintiffs have suffered antitrust injuries stemming from Defendants' allegedly monopolistic conduct. See Paycom Billing Servs., Inc. v. Mastercard Int'l, Inc., 467 F.3d 283, 289 (2d Cir. 2006) (holding that conclusory allegations unsupported by facts cannot "substitute for minimally sufficient factual allegations") (internal quotation marks omitted).
At the court's May 2, 2017 hearing, Plaintiffs' counsel conceded that Plaintiffs had not alleged such antitrust injuries. See Doc. 27 at 68:17-20 ("Monopoly claims, as I said before, typically have two types of injuries: An injury to a consumer. Because of the selling power I have, I can charge you too much money. That's not what we are alleging."). Instead, Plaintiffs maintain that they have been harmed as Defendants' "competitors" because their "supplied product is passed along relatively unchanged." Aventis Envtl. Sci. USA LP v. Scotts Co., 383 F.Supp.2d 488, 497-98 (S.D.N.Y. 2005) (denying motion for summary judgment for lack of antitrust standing and holding that "[i]n this case, rather than having exited the market and become a mere supplier, AgrEvo EH remained a competitor in every relevant economic sense") (internal quotation marks omitted). Plaintiffs read Aventis too broadly. Under Aventis, a supplier is not converted into a competitor merely because the supplier's product passes through processing relatively unchanged. Rather, in Aventis, the plaintiff was a "former competitor" of the defendant and retained the supply of "the only active ingredient[] ... in fully formulated ready-to-use (`RTU') form" for a product which defendant then "packaged
Even assuming arguendo that Plaintiffs plausibly allege they are Defendants' competitors, at the court's May 2, 2017 hearing, Plaintiffs' counsel asserted that Defendants' alleged monopoly power has facilitated the sale of milk products at too low of a price, "wip[ing] out" competition. See Doc. 27 at 68:21-25 (stating that Plaintiffs' injuries occur when Defendants' alleged market power enables them to "sell [a]t too little a price and drop the market down and wipe out [the] competition"). However, "cutting prices in order to increase business often is the very essence of competition." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 594, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). "In cases seeking to impose antitrust liability for prices that are too low, mistaken inferences are especially costly, because they chill the very conduct the antitrust laws are designed to protect." Pac. Bell Tel. Co. v. Linkline Commc'ns, Inc., 555 U.S. 438, 451, 129 S.Ct. 1109, 172 L.Ed.2d 836 (2009) (internal quotation marks omitted); see also Spectrum Sports, 506 U.S. at 459, 113 S.Ct. 884 (stating that "[t]he concern that § 2 might be applied so as to further anticompetitive ends is plainly not met by inquiring only whether the defendant has engaged in `unfair' or `predatory' tactics"). "Low prices benefit consumers regardless of how those prices are set, and so long as they are above predatory levels, they do not threaten competition." Atl. Richfield Co. v. USA Petroleum Co., 495 U.S. 328, 340, 110 S.Ct. 1884, 109 L.Ed.2d 333 (1990); see also id. at 344, 110 S.Ct. 1884 (stating that "[t]he antitrust injury requirement ensures that a plaintiff can recover only if the loss stems from a competition-reducing aspect or effect of the defendant's behavior").
An exception to the general rule that damages as a result of monopolization do not arise from prices that are too low is a predatory pricing claim. That claim is:
Pac. Bell, 555 U.S. at 451, 129 S.Ct. 1109 (quoting Brooke Grp. Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209, 224, 113 S.Ct. 2578, 125 L.Ed.2d 168 (1993)). Plaintiffs neither allege predatory pricing, nor a "dangerous probability" that Defendants will recoup their investment in below-cost prices. Brooke Grp., 509 U.S. at 224, 113 S.Ct. 2578. Plaintiffs therefore cannot sustain their burden of alleging antitrust injury for their monopolization claims. See Cargill, Inc. v. Monfort of Colo., Inc., 479 U.S. 104, 116, 107 S.Ct. 484, 93 L.Ed.2d 427 (1986) ("To hold that the antitrust laws protect competitors from the loss of profits due to such price competition would, in effect, render illegal any decision by a firm to cut prices in order to increase market share. The antitrust laws require no such perverse result[.]").
Assessed as a totality, the antitrust injuries Plaintiffs allege as a result of Defendants' monopolistic conduct are the same injuries Plaintiffs allege in their monopsonization claims. Unless or until Plaintiffs can allege they suffered discernible injuries as a result of Defendants' alleged monopolization, they lack antitrust standing to assert their monopolization claims, regardless of whether they classify themselves as "suppliers" or "competitors." Because Plaintiffs' monopolization claims fail
"Monopsony power is market power on the buy side of the market. As such, a monopsony is to the buy side of the market what a monopoly is to the sell side and is sometimes colloquially called a `buyer's monopoly.'" Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co., 549 U.S. 312, 320, 127 S.Ct. 1069, 166 L.Ed.2d 911 (2007) (citation omitted); accord Todd, 275 F.3d at 202 (stating that "in the context of monopsony[,] ... `the market is not the market of competing sellers but of competing buyers. This market is comprised of buyers who are seen by sellers as being reasonably good substitutes.'") (quoting Roger D. Blair & Jeffrey L. Harrison, Antitrust Policy and Monopsony, 76 Cornell L. Rev. 297, 324 (1991)).
As the Supreme Court has observed, monopsony power may be acquired through a "predatory-bidding scheme," in which "a purchaser of inputs `bids up the market price of a critical input to such high levels that rival buyers cannot survive (or compete as vigorously) and, as a result, the predating buyer acquires (or maintains or increases its) monopsony power.'" Weyerhaeuser, 549 U.S. at 320, 127 S.Ct. 1069 (quoting John B. Kirkwood, Buyer Power and Exclusionary Conduct, 72 Antitrust L.J. 625, 652 (2005)).
Id. at 320-21 (alterations in original) (quoting Steven C. Salop, Anticompetitive Overbuying by Power Buyers, 72 Antitrust L.J. 669, 672 (2005)).
In this case, Defendants argue that Plaintiffs cannot allege antitrust injuries based on Defendants' alleged monopsony because DFA's cooperative structure and the manner in which DMS operates render such injuries impossible. See Doc. 16-1 at 19 ("In fact, plaintiffs cannot allege that either DFA or DMS is even capable of achieving or obtaining the evils of a monopsony in the first place."). DFA's Articles of Incorporation and Bylaws (the "Bylaws"), which are incorporated by reference in and attached to the RFAC, state that:
(RFAC, Ex. B § 2.10.) The Bylaws further provide that:
Id. § 6.1.
Based on the foregoing, Defendants contend that DFA's "cooperative structure ... prevents it from being able to achieve the objective of a monopsonist — to increase its own profits at the expense of its input sellers." (Doc. 16-1 at 20.) The court disagrees. Plaintiffs allege that DFA is not simply a cooperative, but the "largest milk processor in the world." (RFAC ¶ 139.) DFA has allegedly attained monopsony power through a series of acquisitions undertaken with the apparent strategy of "buy[ing] up the other processors and either forc[ing] them into DFA/DMS full supply contracts or shut[ting] them down to eliminate competition." Id. ¶ 137.
Plaintiffs further assert that DFA's monopsony power enables it to buy raw Grade A milk from Plaintiffs at a low cost, as Plaintiffs can no longer sell to other processors at a competitive price because Defendants have limited the avenues where Plaintiffs could otherwise sell their milk. See id. ¶ 94 ("Defendants used their control over the fluid Grade A milk supply market to force independent dairy cooperatives and independent dairy farmers to join DFA or market their milk through DMS."); id. ¶ 95 ("These actions have injured Plaintiffs by allowing the Defendants to acquire and maintain a monopsony and use their market power to suppress the price paid to the dairy farmers.").
Knevelbaard, 232 F.3d at 988 (quoting 2 Philip E. Areeda & Herbert Hovenkamp, Antitrust Law ¶ 375b at 297 (rev. ed. 1995)).
Where, as here, suppliers to an alleged monopsonist are paid depressed prices and the monopsonist, as a result, reaps the benefits at its processing plants, the suppliers may plausibly allege antitrust injury. See Mandeville Island Farms, Inc. v. Am. Crystal Sugar Co., 334 U.S. 219, 235, 68 S.Ct. 996, 92 S.Ct. 1328 (1948) ("It is clear that the agreement is the sort of combination condemned by the [Sherman] Act, even though ... the persons specially injured ... are sellers, not customers or consumers.") (footnotes omitted); see also Todd, 275 F.3d at 201 ("Plaintiff is correct to point out that a horizontal conspiracy among buyers to stifle competition is as unlawful as one among sellers.").
Defendants' further argument that DFA's cooperative status precludes anti-trust
Plaintiffs have also plausibly alleged that DMS may be liable as DFA's agent for their monopsonization claims.
For the foregoing reasons, Defendants' motion to dismiss Plaintiffs' monopsonization claims for lack of antitrust injury is DENIED.
Finally, Defendants argue that Plaintiffs Daniel F. Stolzfoos, David and Robin Fitch, Brian Reape, and Tracy Stanko,
The court agrees that Plaintiffs have sufficiently alleged that because these four individuals are within the "target area" of Defendants' allegedly anticompetitive conduct.
In determining whether the non-supplier Plaintiffs are efficient enforcers of the antitrust laws, the court's inquiry is guided by the following factors:
Id. (quoting AGC, 459 U.S. at 540-45, 103 S.Ct. 897). "[T]he weight to be given the various factors will necessarily vary with the circumstances of particular cases." Daniel, 428 F.3d at 443.
Regarding the first efficient enforcer factor, the injuries alleged by the four non-supplier Plaintiffs are relatively clear and direct. Like the remaining Plaintiffs, they claim that they have systematically been paid artificially depressed prices for the raw Grade A milk they market, and that Defendants' conduct deprives them of the opportunity to receive a competitive price for that product. They further allege that Defendants' conduct has depressed "over-order premiums" and prices paid to farmers for their milk, a claim only a dairy farmer in Order 1 can assert. This is not a case in which Plaintiffs are seeking to "vastly extend the potential scope of antitrust liability in myriad markets[.]" Gelboim, 823 F.3d at 779. The first factor therefore militates in favor of finding, at the pleading stage, that these four non-supplier Plaintiffs are efficient enforcers of the antitrust laws.
With respect to the second factor, there are more direct victims of the alleged conspiracy
Regarding the third and fourth factors, the calculation and apportionment of damages for the four non-supplier Plaintiffs may present considerable challenges. "At the same time, some degree of uncertainty stems from the nature of antitrust law." Gelboim, 823 F.3d at 779; see also J. Truett Payne Co. v. Chrysler Motors Corp., 451 U.S. 557, 566, 101 S.Ct. 1923, 68 L.Ed.2d 442 (1981) (observing that "[t]he vagaries of the marketplace usually deny us sure knowledge of what plaintiff's situation would have been in the absence of the defendant's antitrust violation"); Bigelow v. RKO Radio Pictures, 327 U.S. 251, 265, 66 S.Ct. 574, 90 S.Ct. 652 (1946) (stating that "[t]he most elementary conceptions of justice and public policy require that the wrongdoer shall bear the risk of the uncertainty which his own wrong has created"). Construing the RFAC in the light most favorable to Plaintiffs, and drawing all reasonable inferences in their favor, "there is little difference regarding the proportionality of damages suffered by [the Plaintiffs], which dealt directly with Defendants, and [the four non-supplier Plaintiffs], which did not." In re Foreign Exch. Benchmark Rates Antitrust Litig., 2016 WL 5108131, at *9. "At the motion to dismiss stage, any holding that these damages would be speculative is premature." Id. at *11.
On balance, at the pleading stage, the four non-supplier Plaintiffs who did not supply raw Grade A milk to DMS or a co-conspirator plausibly allege that they are efficient enforcers of the antitrust laws. Defendants' motion to dismiss on that basis is therefore DENIED.
For the foregoing reasons, Defendants' motion to dismiss the RFAC is GRANTED IN PART AND DENIED IN PART (Doc. 16). Counts I-III are DISMISSED only insofar as Plaintiffs therein allege monopolization claims. The motion is DENIED in all other respects. As Plaintiffs have already amended their pleadings on two occasions, the court does not grant leave to amend sua sponte. See Clarke v. White Plains Hosp., 2015 WL 13022510, at *6 (S.D.N.Y. Apr. 22, 2015) (declining to grant leave to amend sua sponte where plaintiff had "twice been given the opportunity to amend" and had "not requested leave to file a third amended complaint").
SO ORDERED.