897 F.3d 1109
9th Cir.2018Background
- Professional golf caddies (Plaintiffs) sued the PGA Tour (Defendant) alleging the Tour requires caddies to wear sponsor-bearing bibs during tournaments and receives all advertising revenue while paying the caddies nothing.
- Caddies must sign a Caddie Registration and Regulations Form (the Form) to participate; the Form assigns media rights to the Tour and contains a regulation requiring caddies to wear "uniforms and identification badges as prescribed by the host tournament and PGA Tour."
- Plaintiffs asserted contract, quasi-contract, economic duress, California publicity and unfair-competition claims, a Lanham Act false-endorsement claim, and Sherman Act §§1–2 antitrust claims based on two proposed product markets (an Endorsement Market and a Live Action Advertising Market).
- The district court dismissed all claims with prejudice, finding (a) the Form unambiguously authorized bibs (plaintiffs consented), (b) no plausible economic duress, and (c) the plaintiffs failed to plead plausible product markets for their antitrust claims.
- On appeal the Ninth Circuit affirmed most dismissals but vacated the district court’s denial of leave to amend the antitrust and California UCL claims and remanded for reconsideration of leave to amend.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Contract/consent to bibs | Form does not unambiguously authorize bib sponsorship; plaintiffs did not voluntarily consent | Regulation requiring prescribed "uniforms" and plaintiffs’ concession that bibs have been required for decades show consent | Court: Plaintiffs consented; Form unambiguously covers bibs; breach and related contract-based claims dismissed |
| Economic duress | Plaintiffs were coerced into signing/complying because refusal would bar tournament participation and livelihood | Tour’s longstanding practice and availability of the profession indicate no coercive act leaving no reasonable alternative | Court: No plausible economic duress; dismissal proper |
| Antitrust product-market pleading | Plaintiffs define Endorsement Market and Live Action Advertising Market as distinct markets not interchangeable with other advertising | Tour argues many reasonable substitutes (TV, print, online, course signage) make the proposed markets facially unsustainable | Court: Proposed markets omit numerous reasonable substitutes and are not plausibly distinct submarkets; antitrust claims dismissed |
| Denial of leave to amend | Plaintiffs sought leave to amend antitrust and UCL claims | Tour opposed; district court denied leave without detailed rationale | Court: Dismissal of those claims affirmed but denial of leave to amend vacated; remand to reconsider leave to amend |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (standard for plausible pleading)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (plausibility and Twombly/Iqbal pleading framework)
- Newcal Indus., Inc. v. Ikon Office Sols., 513 F.3d 1038 (facially unsustainable market definitions at pleading stage)
- Brown Shoe Co. v. United States, 370 U.S. 294 (definition and indicators of product/submarket for antitrust purposes)
- Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048 (standards and abuse-of-discretion for denial of leave to amend)