IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
October 30, 2009
No. 08-30289
Charles R. Fulbruge III
Clerk
JEBACO INC
Plaintiff - Appellant
v.
HARRAH’S OPERATING CO INC; HARRAH’S LAKE CHARLES LLC;
HARRAH’S STAR PARTNERSHIP; PLAYERS LAKE CHARLES LLC;
PLAYERS RIVERBOAT MANAGEMENT LLC; PLAYERS RIVERBOAT II
LLC; PINNACLE ENTERTAINMENT INC.
Defendants - Appellees
Appeal from the United States District Court
for the Eastern District of Louisiana
Before JONES, Chief Judge, and WIENER and BENAVIDES, Circuit Judges.
EDITH H. JONES, Chief Judge:
Jebaco Inc. appeals the dismissal of its federal antitrust claims against
Pinnacle Entertainment and Harrah’s Operating Company, Inc., along with five
Harrah’s subsidiaries (“Harrah’s”).1 The district court dismissed the claims
under Fed. Rule Civ. Proc. 12(c) as barred by the state action doctrine and Noerr-
1
These subsidiaries are Harrah’s Lake Charles, LLC; Harrah’s Star Partnership;
Players LC LLC; Players Riverboat Management LLC; and Players Riverboat II LLC. The
lawsuit names an entity called Players Lake Charles LLC. This is, in fact, Players LC, LLC.
Harrah’s Lake Charles, LLC, and Harrah’s Star Partnership no longer exist. After being sold
to Pinnacle, they were renamed PNK (SCB), LLC, and PNK (Baton Rouge) Partnership,
respectively.
No. 08-30289
Pennington petitioning immunity. We affirm on the alternate ground, fully
briefed below and on appeal, that Jebaco’s complaint fails to allege antitrust
standing.
After dismissing the federal antitrust claims, the district court declined to
exercise supplemental jurisdiction over Jebaco’s pendent state law claims. The
appellees move, on appeal, to amend Harrah’s answer for the purpose of alleging
diversity jurisdiction and reinstating the state law claims in federal court. This
motion is dismissed.
I. BACKGROUND
The facts, viewed in the light most favorable to Jebaco, the nonmovant, are
as follows. Jebaco does not own or operate any casinos. Players Lake Charles,
Inc., did,2 and in May 1993, it leased two berths in Lake Charles, Louisiana,
from the Beeber Corporation to conduct riverboat gambling. Under a separate
March 1993 agreement, Jebaco was entitled to receive a portion of the rent,
which was a per-patron fee. The parties had a dispute that was resolved in a
1995 settlement agreement, under which Jebaco, again, had a right to receive
a per-patron fee. In 2000, Harrah’s purchased Players and assumed this
payment obligation. Jebaco’s rights under the 1995 settlement agreement are
its only asset described in the record.
Hurricane Rita struck Lake Charles in September 2005, damaging at least
one of Harrah’s riverboats and the docking area. Harrah’s then ceased operating
at this location, halted its per-patron fee payments to Jebaco, and solicited bids
for the two riverboats, the gaming licenses associated with the riverboats, and
2
This entity is not a party to the lawsuit, and may no longer exist. It is the Players
entity party to the 1995 settlement agreement relevant to this lawsuit.
2
No. 08-30289
the real property associated with the berths. Jebaco placed a bid, but Harrah’s
sold to Pinnacle instead for $70 million, a sum Jebaco asserts is much greater
than the property’s reasonable value. The purchase agreement between
Harrah’s and Pinnacle initially contained a clause that required Pinnacle to pay
Harrah’s $100 million if Pinnacle attempted to transfer the operations, assets,
or licenses acquired in the sale to the New Orleans or Shreveport markets. This
provision was removed before completion of the sale, however.
According to Jebaco, Harrah’s and Pinnacle hold six of the fifteen riverboat
gambling licenses in Louisiana and the only land-based gambling license in the
state. Jebaco contends that, together, they earn approximately 60 percent of all
gaming revenue generated in Louisiana, including 80 percent of the gambling
revenue in the New Orleans metropolitan statistical area (MSA), 62 percent of
the revenue in the Lake Charles MSA, and 50 percent in the Shreveport/Bossier
City MSA.
Gambling is heavily regulated in Louisiana. See L A. R EV. S TAT. A NN.
§ 27:1, et seq. (titled the “Louisiana Gaming Control Law”). The Louisiana
Gaming Control Law’s explicit purpose is “to protect the general welfare of the
state’s people by keeping the state free from criminal and corrupt elements.”
§ 27:2(A). Consequently, the law “strictly” regulates “persons, locations,
practices, associations, and activities related to the operation of licensed and
qualified gaming establishments,” id., by requiring permitting, licensing, and
reporting, §§ 27:21.1, 29–29.5, 65, 71, 74, 75, 86; providing for enforcement,
§§ 27:19–20; criminalizing certain gambling related activities and violations of
gambling regulations, §§ 27:30–30.6; and establishing other rules, qualifications,
and procedures.
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No. 08-30289
The law also creates the Louisiana Gaming Control Board (“LGCB”),
which has “all regulatory, enforcement, and supervisory authority under the
Law,” §§ 27:11, 15, including determining whether permit and license applicants
are “suitable,” 3 §§ 27:28, 70. The law limits to fifteen the number of licenses
available for operating a riverboat casino in the state, with no more than six
licenses to be used on any designated waterway at a time.4 § 27:65. These
licenses must be used at a specific berth, § 27:65(12), and are non-transferrable,
§ 27:68.
Harrah’s and Pinnacle agreed they would cooperate to secure the LGCB’s
approval to transfer the licenses. Pinnacle also applied to use one of the licenses
at another location in Lake Charles, a berth in which Jebaco does not have an
interest. Further, at a July 18, 2006 public hearing, Pinnacle told the LGCB
that it was exploring using the second license at another location, which would
deprive Jebaco of all revenue. On August 15, 2006, the LGCB approved both
applications, but the second license remains in place.
In the wake of this transaction, but before the LGCB ruled on the
petitions, Jebaco sued Pinnacle and Harrah’s in federal court seeking monetary
and injunctive relief. Jebaco’s complaint alleged that Harrah’s and Pinnacle
3
A licensee, who operates casinos, and a permitee, who supplies or is employed by
casinos, must be “a person of good character, honesty, and integrity,” who does not “pose a
threat to the public interest,” is “capable of and likely to conduct the activities” which he seeks
permission to conduct, and is not disqualified by having committed certain enumerated
criminal offenses. § 27:28. In addition, riverboat casino licensees must have adequate
experience, training, and education, adequate financing, the ability to operate a vessel,
detailed design plans, docking facilities, and “a good faith plan to recruit, train, and upgrade
minorities in all employment classifications.” § 27:70.
4
Louisiana has also authorized one land-based casino in the New Orleans area,
§ 27:201–286, which Harrah’s owns, two casinos on Indian reservations, and three “racinos.”
4
No. 08-30289
violated the Sherman Act, 15 U.S.C. §§ 1-2, by dividing the Louisiana casino
market and by monopolizing, attempting to monopolize, and conspiring to
monopolize that market. Jebaco asserts this alleged anticompetitive conduct
deprived it of both the revenue from a casino operating at Jebaco’s berths and
the ability to purchase Harrah’s assets.
Pinnacle and Harrah’s moved for a judgment on the pleadings, F ED. R. C IV.
P. 12(c).5 Both motions argued that Jebaco failed to allege antitrust standing
and that Jebaco’s claims were barred by the state action doctrine and
Noerr-Pennington petitioning immunity. The district court dismissed the
antitrust claims, ruling on the latter two arguments without addressing
antitrust standing. Jebaco appeals.
Jebaco’s complaint also alleged seven Louisiana law causes of action
against Harrah’s,6 over which the district court originally exercised supple-
mental jurisdiction. See 28 U.S.C. § 1367. After it dismissed the federal claims,
the district court declined to exercise jurisdiction over the pendent state law
claims. Harrah’s moves, on appeal, to amend its answer to allege diversity
jurisdiction over the state law claims.
II. STANDARD OF REVIEW
We review de novo motions to dismiss and motions for judgment on the
pleadings. Doe v. MySpace, Inc., 528 F.3d 413, 418 (5th Cir. 2008). The
5
Both defendants titled their motions “Motion to Dismiss,” and the district court also
used this term. Because both defendants filed an answer before filing this motion, both
motions were for a judgment on the pleadings. See FED R. CIV . P. 12(c).
6
These are breach of duty of good faith, negligent breach of contract, breach of
contract, breach of accounting and reporting obligation, unfair trade practices, unjust
enrichment, and subrogation.
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No. 08-30289
standard is the same for both. Id. Viewing the facts as pled in the light most
favorable to the nonmovant, a motion to dismiss or for a judgment on the
pleadings should not be granted if a complaint provides “enough facts to state
a claim to relief that is plausible on its face.” Id. (quoting Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 1974 (2007)); see also Ashcroft v.
Iqbal, 556 U.S. ____, 129 S.Ct. 1937, 1949-50 (2009). Moreover, the complaint
must allege “more than labels and conclusions,” “a formulaic recitation of the
elements of a cause of action will not do,” and “factual allegations must be
enough to raise a right to relief above the speculative level.” Twombly, 550 U.S.
at 555, 127 S.Ct. at 1965.
III. DISCUSSION
Jebaco alleges that Harrah’s and Pinnacle have divided the Louisiana
casino market 7 in violation of federal antitrust laws and caused Jebaco to lose
per-patron fees and the ability to purchase Harrah’s assets and participate in
the market.8 The district court dismissed these antitrust claims after finding
them barred by the state action doctrine and Noerr-Pennington petitioning
immunity.9 We express no opinion on these exceptions to the scope of antitrust
7
The parties’ briefing assumes, as we do for present purposes only, that the Louisiana
casino market is a relevant antitrust market.
8
Neither Pinnacle nor Harrah’s contends that Jebaco’s allegations of Sherman Act
violations are insufficiently detailed to “state a claim to relief that is plausible on its face.”
Iqbal, 556 U.S. ____, 129 S.Ct. at 1949 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. at 1974).
We therefore assume that Jebaco’s allegations are legally sufficient under FED . R. CIV . P. 8.
9
The district court’s ruling relied heavily on Astoria Entertainment v. Edwards, 159
F. Supp.2d 303 (E.D. La. 2001). That case is factually inapposite. There, the plaintiff claimed
its unsuccessful riverboat gaming license application was the result of, inter alia, federal
antitrust law violations. Among the many named defendants were several corporate licensees
who were alleged to be participating in a politically corrupt conspiracy to deny the plaintiff a
6
No. 08-30289
liability. Instead, we affirm on the alternate ground, fully briefed below and on
appeal, that Jebaco has failed to allege sufficient facts that, if true, would
establish a plausible claim of antitrust standing. See Iqbal, 556 U.S. ____, 129
S.Ct. at 1949–50.
This court has previously described the basic tenets of standing to sue for
an antitrust violation, pursuant to Section 4 of the Clayton Act, as follows:
Standing to pursue an antitrust suit exists only if a plaintiff shows:
1) injury-in-fact, an injury to the plaintiff proximately caused by the
defendants’ conduct; 2) antitrust injury; and 3) proper plaintiff
status, which assures that other parties are not better situated to
bring suit. . . .
Antitrust injury must be established for the plaintiff to have
standing under section 1 or section 2 of the Sherman Act. This
requirement is inferred from section 4 of the Clayton Act, which
affords a remedy to any person injured in his business or property
“by reason of” an antitrust violation. 15 U.S.C. § 15(a).
Doctor’s Hospital of Jefferson, Inc. v. Southeast Med. Alliance, 123 F.3d 301, 305
(5th Cir. 1997) (citations omitted).10 In Brunswick Corp. v. Pueblo Bowl-O-Mat,
Inc., 429 U.S. 477, 489, 97 S.Ct. 690, 697, 50 L.Ed.2d 701 (1977), the Supreme
Court described antitrust injury as
license. The district court held that the actions of the corporate defendants to lobby and
secure their own licenses were protected by Noerr-Pennington. The plaintiff did not allege that
private actors violated the Sherman Act through an illegal horizontal restraint, as Jebaco
does.
10
These requirements are somewhat relaxed for plaintiffs seeking injunctive relief
under Section 16 of the Clayton Act. The injury alleged is not limited to business or property;
damages can be simply threatened; and fear of duplicative or speculative recovery will not
preclude relief. 15 U.S.C. § 26; Cargill, Inc. v. Monfort of Colo., Inc., 479 U.S. 104, 111 & n.6,
107 S.Ct. 484, 489-90 & n.6 (1986).
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No. 08-30289
. . . injury of the type the antitrust laws were intended to prevent
and that flows from that which makes the defendants’ acts
unlawful. The injury should reflect the anti-competitive effect
either of the violation or of anticompetitive acts made possible by
the violation. It should, in short, be “the type of loss that the
claimed violations . . . would be likely to cause.”
Id. (citing Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 125, 89
S.Ct. 1562, 1577, 23 L.Ed.2d 129 (1969)); see also Atlantic Richfield Co. v. USA
Petroleum Co., 495 U.S. 328, 342–44, 110 S.Ct. 1884, 1893–94, 109 L.Ed.2d 333
(1990). In Brunswick, several bowling alley operators sued a bowling equipment
manufacturer that had bought failing bowling alleys and provided cash to keep
the operations afloat. Id. at 479–80, 97 S.Ct. at 692–93. The plaintiffs alleged
that the defendant’s purchase of the failing bowling alleys gave the defendant
significant market power in violation of the antitrust laws, and alleged lost
profits resulting from the failing bowling alleys staying in business. Id. The
court held that the plaintiffs had failed to demonstrate antitrust injury: they
were injured by increased, not decreased, competition. Id. Finally, the focus of
remedies available under federal antitrust laws is principally upon consumers
or competitors affected by anticompetitive conduct. See Associated Gen.
Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 519,
538–39, 103 S.Ct. 897, 908–09 (1983); Norris v. Hearst Trust, 500 F.3d 454, 465-
66 (5th Cir. 2007) (“Plaintiffs [newspaper distributors] were not consumers of the
[newspaper] or its advertising services, and they were not producers or sellers
of competing publications or media.”)
Antitrust injury is at issue here. Jebaco alleges two types of injuries.
First, Harrah’s and Pinnacle’s alleged market division deprived Jebaco of the
per-patron fee it used to receive before Harrah’s ceased operating at the Lake
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No. 08-30289
Charles berths in which Jebaco had an interest. This aspect of Jebaco’s losses
thus stems from its position as a landlord or supplier of a berth to the appellees.
Second, Jebaco was deprived of the opportunity to compete by purchasing
Harrah’s Lake Charles assets because only Pinnacle could provide Harrah’s with
the opportunity to engage in anticompetitive conduct. Jebaco allegedly suffered
injury as a would-be competitor. Neither allegation fits comfortably within a
“classical” antitrust fact pattern, and both fail to allege antitrust injury.
A. Landlord/Supplier Injury
Although the allegations of its complaint are vague, Jebaco asserts that
its “interest” in the downtown Lake Charles berths derives from its assignment
of the right to lease the property for gaming operations in exchange for which
Jebaco was to receive per-patron fees from Harrah’s well into the 21st century.
The casino shutdown caused by Hurricane Rita first interfered with Jebaco’s
expectation, followed by the transfer of the licenses to Pinnacle and Pinnacle’s
relocation of the riverboat.
Jebaco characterizes the loss of its per-patron fee “interest” as injury to its
“competitive position,” but how it was competing or against whom in receipt of
the fees is a blank. Under Twombly, however, we must accept Jebaco’s factual
allegations but are not bound to its legal conclusions. Twombly, 550 U.S. at
556–57, 127 S.Ct. at 1965–66. The closest, albeit imperfect, market analogies
to the Jebaco–casino operator relationship are those of landlord–tenant or
supplier–customer. Those relationships, when terminated or modified as a
byproduct of “downstream” anticompetitive conduct, have rarely been held to
inflict antitrust injury. See 2 P. A REEDA & H. H OVENKAMP, A NTITRUST L AW,
¶ 350(f–g), at 422–23 (2d ed. 2000) (“When a downstream firm merely
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No. 08-30289
substitutes one supplier for another, there is certainly injury-in-fact to the
terminated supplier, but there is rarely antitrust injury.”) (citing Balaklaw v.
Lovell, 14 F.3d 793 (2d Cir. 1994)); see also SAS of Puerto Rico, Inc. v. Puerto
Rico Telephone Co., 48 F.3d 39, 44 (1st Cir. 1995) (finding no antitrust standing
for supplier where customer breached agreement with supplier during the course
of customer’s alleged antitrust violation).
For lessors, the results have been similar. Antitrust injury is not caused
by the anticompetitive actions of a tenant in the tenant’s market because a
lessor is neither a consumer nor a competitor in the downstream market.
Serfecz v. Jewel Food Stores, Inc., 67 F.3d 591, 597 (7th Cir. 1995); see also
Henke Enterp., Inc. v. Hy-Vee Food Stores, Inc., 749 F.2d 488, 490 (8th Cir.
1984).
Moreover, in this case the market division has little or nothing to do with
Jebaco’s lost per-patron fees. Had Pinnacle remained at Jebaco’s preferred
berths and kept paying the fees, the alleged market division would still have
occurred, and Jebaco would be uninjured. Alternatively, if a different firm had
purchased Harrah’s assets, it too might have chosen not to operate at Jebaco’s
preferred berths. No antitrust violation would have occurred, but Jebaco would
have suffered the same injury. See Brunswick v. Pueblo Bowl-O-Mat, Inc.,
429 U.S. 477, 487, 97 S.Ct. 690, 697 (1977) (finding no antitrust injury where the
same injury-in-fact would have occurred had a smaller company purchased the
competing businesses); see also Norris, 500 F.3d at 466; Walker v. U-Haul Co. of
Miss., 747 F.2d 1011, 1015 (5th Cir. 1985). Pinnacle’s choice to change berths,
a choice wholly independent of any antitrust violation, was the cause of Jebaco’s
injury.
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No. 08-30289
Jebaco’s briefing to the district court explains its misconception about
antitrust injury. Jebaco argued that “the intent of the defendants’ market
division was to remove Harrah’s current lessors, including plaintiff Jebaco . . .
and thereby reduce the business costs of Pinnacle . . . . [T]he purpose of the
antitrust laws is to protect small business from larger ones . . . .” This is wrong:
The federal antitrust laws protect competition, not competitors. Brunswick, 429
U.S. at 488, 97 S.Ct. at 697. A lessor’s or supplier’s injury is not injury to
competition except, for instance, where the injury is the direct result of an illegal
refusal to deal or a tying violation. Jebaco did not allege that Pinnacle’s choice
to reposition its licenses in Lake Charles was itself an anticompetitive act.
Jebaco’s loss of its per-patron fees is neither the type of injury antitrust
law was designed to prevent, nor did it flow from any anticompetitive conduct
of Harrah’s and Pinnacle. Consequently, Jebaco did not have antitrust standing
to sue.
B. Potential Competitor Injury
Characterizing itself, in wholly conclusional terms, as a “potential
competitor” of Harrah’s and Pinnacle and a “potential bidder” for the casino
assets, Jebaco asserts that their market division conspiracy eliminated its ability
to enter the market utilizing its Lake Charles berthing interest.
Certain theoretical objections may be initially raised against this claim.
For instance, potential competitors must meet a threshold of preparedness to
enter a market before they may seek damages from anticompetitive exclusion.
Jayco Systems, Inc. v. Savin Business Machines Corp., 777 F.2d 306, 313–16 (5th
Cir. 1985) (citing Martin v. Phillips Petroleum Company, 365 F.2d 629, 633 (5th
Cir. 1966)). Such threshold proof is necessary to protect antitrust litigation from
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No. 08-30289
frivolous claims. Following Twombly and Iqbal, it is likely that Jebaco’s mere
allegations of potential competitor status, without any facts to demonstrate its
financial status or its ability to fulfill the demanding requirements of Louisiana
gaming law, are insufficiently pled. Further, any potential competitor’s
antitrust claim would have to be viewed skeptically in a market where entry is
fully controlled by a regulatory body. Nevertheless, we assume arguendo that
Jebaco satisfactorily pled its preparedness and ability to compete in the casino
operating market.
Even as a potential competitor, however, Jebaco’s injury did not “flow[ ]
from” an antitrust law violation. See Brunswick, 429 U.S. at 489, 97 S.Ct. at
697; see also Lucas Automotive Engineering, Inc. v. Bridgestone/Firestone, Inc.,
140 F.3d 1228, 1233 (9th Cir. 1998) (finding no antitrust standing where
plaintiff alleged that an exclusive distribution agreement, for which it lost the
bidding, violated the Sherman Act); Bayou Bottling, Inc. v. Dr. Pepper Co.,
725 F.2d 300, 304 (5th Cir. 1984) (no antitrust injury where one soft drink
wholesaler lost out to another in bidding for a bottler’s assets). Like the plaintiff
in Bayou Bottling, Jebaco would have suffered the same harm whether Harrah’s
retained its Lake Charles assets or sold them to any party other than Pinnacle.
The anticompetitive harm caused by the alleged illegal market division is not
connected to Jebaco’s thwarted hopes.
Jebaco incorrectly insists that it is “within the area of the economy
endangered” by the alleged market division, as described by Blue Shield of
Virginia v. McCready, 457 U.S. 465, 479-81, 102 S.Ct. 2540, 2548-49 (1982). In
McCready, a consumer of psychology services sued her insurer, who had denied
her reimbursement, alleging a conspiracy between the insurer and psychiatrists
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No. 08-30289
to exclude psychologists from the psychotherapy market by only reimbursing for
psychiatric treatment. The Court ruled that the plaintiff had antitrust standing
because “the harm to McCready and her class was clearly foreseeable,” id. at
479; she was “within that area of the economy endangered by that breakdown
of competitive conditions,” id. at 480; and her injury was “inextricably inter-
twined with the injury the conspirators sought to inflict on psychologists,” id. at
484. The key to McCready, as this court has noted, was the plaintiff’s status as
a consumer in the relevant market for whom recovery would not duplicate
damages awarded to other potential plaintiffs. Norris, 500 F.3d at 467 & n.18
(quoting SAS of Puerto Rico, Inc. v. Puerto Rico Telephone Company, 48 F.3d 39,
46 (1st Cir. 1995)).
Nor can Jebaco benefit from this court’s holding in Doctor’s Hospital,
supra, that an actual competitor had standing in a “classic” concerted refusal to
deal antitrust case. The plaintiff’s alleged injury there was the intended and
usual result of anticompetitive conduct. Doctor’s Hospital, 123 F.3d at 305–06.
Here, in contrast, Harrah’s selection of Pinnacle from among a number of
bidders is distinct from the decision to maintain or reject berths where Jebaco
owned an interest, and it is that interest alone which supports Jebaco’s status
as a potential competitor. Put differently, any conspiracy between Harrah’s and
Pinnacle to dominate the casino market operated independently of Jebaco’s
interest. Jebaco, even as a potential competitor, was at most a collateral
casualty of the Harrah’s-Pinnacle market division agreement.
Jebaco’s inability to enter the casino market was not a product of antitrust
injury. It was not the type of injury the antitrust laws were designed to prevent,
nor did it flow from the alleged anticompetitive conduct.
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No. 08-30289
C. Motion to Amend Complaint
The appellees jointly move on appeal to amend Harrah’s answer under
28 U.S.C. § 1653 to allege that Jebaco’s state law claims satisfy the requirements
for federal diversity jurisdiction, 28 U.S.C. § 1332. Section 1653 allows defective
allegations of jurisdiction to be amended in the trial or appellate courts.
Equating § 1653 with F ED. R. C IV. P. 15(a), this court has stated that leave to
amend is to be granted liberally unless the movant has acted in bad faith or with
a dilatory motive, granting the motion would cause prejudice, or amendment
would be futile. Whitmire v. Victus Ltd., 212 F.3d 885, 889 (5th Cir. 2000) (citing
Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230 (1963)). Courts may also
consider judicial efficiency, Nance v. Gulf Oil Corp., 817 F.2d 1176, 1180 (5th
Cir. 1987) (discussing F ED. R. C IV. P. 15(a)), and effective case management,
Little v. Liquid Air Corp., 952 F.2d 841, 846 (5th Cir. 1992), before granting a
motion to amend.
In the typical case, leave to amend is granted, but this is not the typical
case. McCready v. eBay, Inc., 453 F.3d 882, 891 (7th Cir. 2006). Jebaco filed a
complaint in federal court on August 9, 2006, pleading federal question subject
matter jurisdiction for its federal antitrust claim and supplemental jurisdiction
for its state law claims. See 28 U.S.C. §§ 1331, 1367. Harrah’s answered on
September 26, 2006, stating that these jurisdictional allegations “do not require
a response from Harrah’s.” For nearly nineteen months, Harrah’s failed to
correct this apparent misstatement. On March 5, 2008, the district court
dismissed Jebaco’s federal antitrust claims and then declined jurisdiction over
the state law claims. The court had no reason to believe an independent basis
for jurisdiction over these claims existed.
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No. 08-30289
Jebaco appealed only the dismissal of its federal antitrust claims.
Harrah’s did not cross-appeal the district court’s decision to decline jurisdiction
over the state law claims. Consequently, Jebaco filed its state law claims in
state court and Harrah’s missed the thirty-day deadline for removing these
claims under 28 U.S.C. § 1446(b).
We will not remedy Harrah’s apparent mistakes that have resulted in
another case pending in state court. Further, one of 28 U.S.C. § 1653’s purposes
is judicial economy. Wolfe v. Marsh, 846 F.2d 782, 785 n.4 (D.C. Cir. 1988) (per
curiam); Nance v. Gulf Oil Corp., 817 F.2d at 1180 (discussing F ED. R. C IV. P.
15(a)). The appellees have cited no case in which § 1653 was deployed to avert
the consistently dilatory conduct they have exhibited.
Harrah’s could have cross-appealed the district court’s decision to decline
jurisdiction over the state law claims, and this court would have reviewed the
decision for an abuse of discretion. See Priester v. Lowndes Cty., 354 F.3d 414,
425 (5th Cir. 2004). We do not have appellate jurisdiction over that decision
here.
Moreover, an additional problem is that the defendants’ citizenship is not
evident from the record. Even if we had jurisdiction, were we to grant the
motion, it would be necessary to remand the state law claims to the district court
to establish the facts underlying diversity. Mollett v. Penrod Drilling Co., 872
F.2d 1221, 1228 (5th Cir. 1989) (per curiam); Strain v. Harrelson Rubber Co.,
742 F.2d 888, 889-90 & n.2 (5th Cir. 1984) (per curiam). This action would inflict
further delay, contrary to the goal of judicial efficiency.
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All of this water under the bridge prevents us from granting Harrah’s
motion, and the authorities Harrah’s cites fail to convince.11 The cases speak
broadly about the liberality to be given plaintiffs who have misdescribed or failed
to describe jurisdiction that otherwise exists. None involves the series of
procedural errors that occurred here or the fatal failure to file a cross-appeal.
Accordingly, the motion is dismissed for lack of jurisdiction.
IV. CONCLUSION
For the foregoing reasons, the district court’s judgment is AFFIRMED.
The motion to amend is DISMISSED.
11
These are Novak v. Capital Mgt. & Dev. Corp., 452 F.3d 902 (D.C. Cir. 2006);
Whitmire v. Victus Ltd., 212 F.3d 885 (5th Cir. 2000); Mollett v. Penrod Drilling Co., 872 F.2d
1221 (5th Cir. 1989) (per curiam); Leigh v. NASA, 860 F.2d 652 (5th Cir. 1988); Carlton v.
Baww, Inc., 751 F.2d 781 (5th Cir. 1985); Nadler v. American Motor Sales Corp., 764 F.2d 409
(5th Cir. 1985); Miller v. Stanmore, 636 F.2d 986 (5th Cir. 1981); Miller v. Davis, 507 F.2d 308
(6th Cir. 1974).
16