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Normally, the United States Court of Appeals for the Ninth Circuit would agree that when the United States Supreme Court alters the pleading requirements for a cause of action, such as it did in Bell Atlantic, plaintiffs should be allowed leave to amend their complaint to meet the new standard. However, dismissal without leave to amend is proper if it is clear that the complaint could not be saved by amendment.
Appellants, who offered customers the convenience of paying with a credit card, alleged that appellees conspired with each other to set the fees charged to merchants, such as appellants, for payment of credit card sales. Appellants contended that appellees' action in setting the amount of the merchant discount fee and interchange fee constituted violations of 15 U.S.C.S. §§ 1 and 26 because appellees conspired to set the amounts charged. The district court dismissed appellants' First Amended Complaint without leave to amend for failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil Procedure 12(b)(6). Appellants sought review.
Did the district court err in dismissing the appellants’ First Amended Complaint without leave to amend for failure to state a claim upon which relief can be granted?
The court agreed with the district court that appellants' amended complaint, like their original complaint, failed to meet the pleading requirements set forth by the U.S. Supreme Court in Bell Atlantic Corp. v. Twombly, 127 S. Ct. 1955, 1964-66, 167 L. Ed. 2d 929 (May 21, 2007) because of the failure to allege specific facts of such conspiracy. As to the banks, appellants failed to plead any evidentiary facts beyond parallel conduct to prove their allegations of a conspiracy. Appellants' claim against the consortium was barred by the "indirect purchaser" rule because they had no contractual relationship with the consortia and they were not charged the interchange fee directly. The court agreed that amendment would be futile because appellants failed to state what additional facts they would plead if given leave to amend.