George Par v. Wolfe Clinic, P.C.George Par v. Wolfe Clinic, P.C.
Before GRUENDER, BENTON, and SHEPHERD, Circuit Judges.
BENTON, Circuit Judge.
Dr. George J. Par (and IVYR PLLC, doing business as Par Retina) sued Wolfe Clinic, P.C. (and three of its owner-physicians). Par alleged that the Clinic monopolized or attempted to monopolize the vitreoretinal care market. On the merits, the district court1 initially dismissed the monopolization, fraudulent inducement, and recission claims, while remanding the remaining state law claims. In an amended judgment, the district court denied Par’s motion to amend the complaint, affirmed the dismissal of the monopolization claims, but declined to exercise supplemental jurisdiction, dismissing all state law claims. Par appeals. Having jurisdiction under
I.
Dr. Par, an ophthalmologist, specializes in vitreoretinal surgery. After the Clinic fired him, he founded Par Retina to provide retinal eye care services in Des Moines, Spencer, and Ft. Dodge, Iowa. Believing that the Clinic harmed his business, Par sued for monopolization and attempted monopolization, asserting 12 state law claims.
Wolfe Clinic moved to dismiss the monopolization, attempted monopolization, fraudulent inducement, and recission claims. In May 2022, the district court dismissed the monopolization claims, ruling that Par failed to plead a plausible claim under the Sherman Act because he did not allege an antitrust injury or state a proper geographic market. The district court also dismissed the fraudulent inducement and recission claims on their merits, but remanded the other state law claims. Par then moved to amend his complaint.
A month later, the district court entered an amended judgment, denying Par’s motion and again dismissing the monopolization claims. The district court, however, ruled it could not remand the state law claims. It instead declined to exercise supplemental jurisdiction over any of the state law claims, dismissing all of them. Par argues that the district court erred in dismissing the antitrust, fraudulent inducement, and recission claims on their merits and refusing to grant his post-judgment motion to amend the complaint.
This court “review[s] de novo the grant of a motion to dismiss, accepting as true all factual allegations in the complaint and drawing all reasonable inferences in favor of the non-moving party.” Richter v. Advance Auto Parts, Inc., 686 F.3d 847, 850 (8th Cir. 2012). “We affirm a Rule 12(b)(6) dismissal if ‘it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.’” Double D Spotting Serv. v. Supervalu, Inc., 136 F.3d 554, 557 (8th Cir. 1998), quoting Hafley v. Lohman, 90 F.3d 264, 266 (8th Cir. 1996). “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 Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). A plausible claim for relief “allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id.
II.
The Sherman Act authorizes two types of antitrust claims: Section 1 generally prohibits contracts that unreasonably restrict trade. See
Par alleges injuries to himself and his business—competitors of the Clinic. Par claims the Clinic interfered with his referral network by purchasing small optometry practices and by falsely disparaging Par to patients and referring physicians and optometrists. “As the Supreme Court has noted repeatedly, Congress enacted the antitrust laws to protect competition, not competitors.” Midwest Commc’ns v. Minnesota Twins, Inc., 779 F.2d 444, 450 (8th Cir. 1985).
Par argues he does not have to state a relevant market because the complaint alleges an “actual adverse effect on competition.” To the contrary, to prevail on a Section 2 claim, a plaintiff must adequately plead a relevant market. See Spectrum Sports, Inc., 506 U.S. at 455-56, 459 (“We stated that, to establish monopolization or attempt to monopolize under § 2 of the Sherman Act, it would be necessary to appraise the exclusionary power . . . in terms of the relevant market for the product involved.”) (“We hold that petitioners may not be liable for attempted monopolization under § 2 of the Sherman Act absent proof of a dangerous probability that they would monopolize a particular market and specific intent to monopolize.”). See also, e.g., Little Rock Cardiology Clinic PA v. Baptist Health, 591 F.3d 591, 596 (8th Cir. 2009) (“The four counts
The briefs discuss only one case in our Circuit that references Section 2 and the “actual adverse effect” standard: Minnesota Ass’n of Nurse Anesthetists v. Unity Hospital, 208 F.3d 655, 662 (8th Cir. 2000) (“But plaintiffs have failed to prove actual adverse effects on competition in that market, such as increased prices for anesthesia services, or a decline in either the quality or quantity of such services available to surgery patients. Absent concrete evidence of this nature, plaintiffs must prove market power in a relevant geographic market.”). But in that case, the court conducted a Section 1 analysis. See id. (noting that plaintiffs “virtually abandon[ed]” their Section 2 claims on appeal).
Even assuming the “actual adverse effect” standard applied to Par’s monopolization claims, the complaint states that the Clinic prevented new retinal care clinics from entering the market, without further detail. This conclusory allegation is insufficient to show an adverse effect on the competition in a market. See Ashcroft, 556 U.S. at 678 (“Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”). The complaint fails to state an actual adverse effect on competition, such as an increase in prices for vitreoretinal services or a decline in the quantity of services provided. Par must plead a relevant market.
“The definition of the relevant market has two components—a product market and a geographic market.” Bathke v. Casey’s Gen. Stores, Inc., 64 F.3d 340, 345 (8th Cir. 1995). “Antitrust claims often rise or fall on the definition of the relevant market.” Id. “The burden of establishing that a specified area constitutes a relevant geographic market in a particular case rests with the plaintiff.” Morgenstern v. Wilson, 29 F.3d 1291, 1296 (8th Cir. 1994). The court must determine whether the plaintiff has alleged a geographic market that includes: (1) “the area in which a defendant supplier draws a sufficiently large percentage of its business” and (2) “a geographic market in which only a small percentage of purchasers have alternative suppliers to whom they could practicably turn in the event that a defendant supplier’s anticompetitive actions result in a price increase.” Little Rock Cardiology, 591 F.3d at 598.
A geographic market fails if it is too narrow, excluding regions where the defendant conducts sufficient business. See Morgenstern, 29 F.3d at 1297 (ruling that the plaintiff’s proposed geographic market, which excluded Omaha, was insufficient because the record showed the defendant conducted significant business in Omaha).
Par proposes two different approaches to defining a geographic market. He first claims that the cities of Des Moines, Ft. Dodge, and Spencer are each a proper geographic market (the cities are about 90, 92, and 179 miles apart, respectively). As in Little Rock Cardiology, these geographic markets are too narrow because the complaint says, “Wolfe Clinic has offices across the state of Iowa.” These three cities thus fail to account for the area where the Clinic “draws a sufficiently large percentage of its business.” Id. at 598. Par argues that each city is a proper geographic market because it is where patients prefer, or have the ability, to travel. The proper inquiry is not where customers prefer to travel, but instead, where there are actual alternatives for services. See Morgenstern, 29 F.3d at 1296 (“The geographic market encompasses the geographic area to which consumers can practically turn for alternative sources of the product and in which the antitrust defendants face competition.”). Based on the factual allegations here, drawing a market boundary around three distant cities fails to allege that the Clinic possessed monopolized power.
Par alternatively proposed “Central Iowa” as a geographic market. This geographic market is insufficient because the complaint does not describe alternative suppliers of retinal eye care in Central Iowa. See id. (ruling that the plaintiff did not establish a claim for monopolization because the “evidence regarding the relevant geographic market failed to address a critical legal question: where could consumers of the product (adult cardiac surgery) practicably turn for alternative sources of the product.”). The complaint here focuses only on the characteristics of retinal patients, describing them as elderly or infirm; relatively immobile; and dependent on caregivers. Because it does not address the alternative sources of vitreoretinal care in Central Iowa, the complaint cannot plausibly allege the Clinic monopolized this proposed market.
Courts are reluctant to dismiss antitrust complaints before the parties have had an opportunity to fully conduct discovery. Little Rock Cardiology, 591 F.3d at 601. Here, dismissal is appropriate because the defects in Par’s complaint would not be cured by additional discovery. See id. (stating that dismissal of the monopolization claims was appropriate where “more discovery in this case could not cure the defects in LRCC’s legal theory as to either the relevant product or geographic market”). Without allegations of a proper geographic market, Par’s antitrust claims must be dismissed because there can be no inference of monopoly
III.
This court “review[s] an order denying leave to amend a complaint for abuse of discretion.” Roberson v. Hayti Police Dep’t, 241 F.3d 992, 995 (8th Cir. 2001). “[D]istrict courts in this circuit have considerable discretion to deny a post judgment motion for leave to amend because such motions are disfavored, but may not ignore the
“Unexcused delay is sufficient to justify the court’s denial . . . if the party is seeking to amend the pleadings after the district court has dismissed the claims it seeks to amend, particularly when the plaintiff was put on notice of the need to change the pleadings before the complaint was dismissed, but failed to do so.” Moses.com Sec., Inc. v. Comprehensive Software Sys., Inc., 406 F.3d 1052, 1065 (8th Cir. 2005). See, e.g., Uradnik v. Inter Fac. Org., 2 F.4th 722, 727 (8th Cir. 2021) (explaining that unexcused delay justifies denying leave to amend “when the party knew of the need to change the pleadings and then had her claim dismissed”). This court has affirmed the denial of a
The district court here dismissed Par’s motion, explaining he had not pointed “to errors of law or fact in the Court’s order warranting amendment of the judgment.” Par argues the court abused its discretion because the amended complaint would have stated a claim under the Sherman Act, which would resolve the case on its merits. See
The district court did not abuse its discretion by denying Par’s motion to amend the complaint. The information in the amended complaint was previously available to Par and should have been pleaded before the judgment was entered. See Innovative Home Health Care, Inc., 141 F.3d at 1286 (
IV.
Both parties’ arguments focus on the district court’s first judgment of May 10, 2022. This court, however, has jurisdiction to review only the district court’s final decision—the amended judgment entered on June 16, 2022. See
V.
Par failed to plead a plausible claim for monopolization or attempted monopolization because he did not allege a relevant geographic market. The district court did not abuse its discretion by denying Par’s post-judgment motion to amend the complaint or by not exercising supplemental jurisdiction over the state law claims.
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The judgment is affirmed.
BENTON
CIRCUIT JUDGE