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A complaint must contain either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory.
Car Carriers, Inc. ("Car Carriers") was a car carrier for Ford Motor Company ("Ford"). When defendant cancelled its contract with Car Carriers and engaged in conduct prohibiting Car Carriers’ acquisition of another company's stock and assets, Car Carriers filed suit alleging violations of the Sherman Act, 15 U.S.C.S. § 1 and the Clayton Act, 15 U.S.C.S. §§ 15, 26. The court dismissed the claims however, and refused to grant Car Carriers leave to amend subsequent to the dismissal. Car Carriers sought review, asserting error in the court's dismissal of the action for failure to state a viable claim and error in the court's refusal to grant leave to amend.
Did the district court err in dismissing Car Carriers’ antitrust complaint for failure to state a claim upon which relief could be granted?
The court affirmed upon a finding that Car Carriers had not alleged that Ford was excused from paying competitive prices or that services in the industry had deteriorated as a result of its conduct. Hence, Car Carriers had failed to successfully plead a contract combination or conspiracy in restraint of trade. In addition, Car Carriers’ right to amend its complaint did not survive dismissal of the entire action because of the fundamental distinction between the right to amend upon dismissal of the action and the right to amend upon dismissal of the complaint.