Opinion
03-CV-0425E(F)
September 26, 2003
MEMORANDUM and ORDER
This decision may be cited in whole or in any part.
Plaintiff ("Colvin") filed suit May 30, 2003. Defendant ("Tops") filed a motion to dismiss on July 14. This matter was argued and submitted August 22. For the reasons set forth below, Tops' motion will be denied.
Tops is a large grocery retailer that owns and operates 204 convenience stores under the names "Wilson Farms," "Sugar Creek" and "Tops Xpress" (collectively "Tops Stores"). Tops also supplies 14 retailers operating under the names "Tops Friendly Markets," "B-Kwik" and "Wilson Farms," which are licensed from Tops. Colvin operates several B-Kwik stores under a license from Tops. Tops and Colvin entered into various Operating Agreements starting in 1975 pursuant to which Tops has supplied Colvin with goods for sale and other retailing services. Colvin alleges that Tops improperly failed to share certain discounts and allowances with it and other Licensees. In other words, Colvin alleges that Tops sold goods to the 204 Tops Stores at a price less than that offered to the 14 Licensees buying the same types of goods. Consequently, Colvin asserts claims against Tops for alleged violation of the Robinson-Patman Act, 15 U.S.C. § 13(a), (d) and (e).
Decl. of John J. Grace ¶ 3.
Decl. of John J. Grace ¶ 4.
Tops also allegedly violated the Operating Agreements. Colvin's contract claims, however, are being arbitrated and are thus not before this Court.
When ruling on a motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure ("FRCvP"), this Court "must accept the material facts alleged in the complaint as true and construe all reasonable inferences in the plaintiff's favor" — Phelps v. Kapnolas, 308 F.3d 180, 184 (2d Cir. 2002) (citation omitted) — and cannot dismiss the complaint "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Accordingly, this Court must not consider whether the claims will ultimately be successful, but merely "assess the legal feasibility of the complaint." Cooper v. Parsky, 140 F.3d 433, 440 (2d Cir. 1998). Moreover, when reviewing a motion to dismiss, this Court must of course limit its review to the face of the Complaint and documents incorporated therein that are properly subject to judicial notice. See Newman Schwartz v. Asplundh Tree Expert Co., 102 F.3d 660, 662 (2d Cir. 1996).
Tops contends that Colvin's Robinson-Patman claim fails as a matter of law, pursuant to FRCvP 12(b)(6), because the sales alleged by Colvin are not interstate in nature. This contention fails, however, because, as noted above, this Court is restricted to the face of the Complaint. Consequently, this Court cannot review the evidentiary materials submitted by Tops in support of its argument, namely a Declaration by a Tops manager, John J. Grace.
Tops' motion pursuant to FRCvP 12(b)(1) must also be denied. Tops cites authority for the proposition that evidentiary material may be considered when addressing a FRCvP 12(b)(1) motion to dismiss for lack of subject matter jurisdiction. Tops claims that Colvin cannot satisfy the "in commerce" requirement of its Robinson-Patman claim. This alleged deficiency, however, is properly construed as a "failure to state a claim" rather than a lack of subject matter jurisdiction. Consequently, in light of well-established Supreme Court precedent, Tops' FRCvP 12(b)(1) motion must be denied.
A FRCvP 12(b)(1) motion challenges the authority or competency of a district court to adjudicate a case. Indeed, such a motion is most often used where (1) no diversity jurisdiction or federal question jurisdiction exists, (2) plaintiff has failed to exhaust administrative remedies or (3) the action is barred by sovereign immunity. A different scenario, however, is involved here. Inasmuch as Colvin's Robinson-Patman claim obviously involves a federal question, this Court has subject matter jurisdiction — i.e., authority to adjudicate this case. Whether Colvin's claim is deficient as a matter of law is a question to be addressed pursuant to FRCvP 12(b)(6) — i.e., whether Colvin fails to allege all of the elements of a Robinson-Patman claim. As noted above, consideration of Tops' evidentiary submissions is inappropriate at this stage. Consequently, inasmuch as Colvin has adequately alleged interstate sales by Tops, Colvin does not fail to state a Robinson-Patman claim. Accordingly, Tops' motion to dismiss will be denied.
See 5A Wright Miller, Federal Practice Procedure: Civil 2d § 1350 (1990).
See supra note 5.
See Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 89 (1998) ("It is firmly established in our cases that the absence of a valid (as opposed to arguable) cause of action does not implicate subject-matter jurisdiction, i.e., the court's statutory or constitutional power to adjudicate the case.") (citing Wright Miller at § 1350 n. 8); Gulf Oil Corp. v. Copp Paving Corp., 419 U.S. 186, 212 n. 9 (1974) (holding that the "allegations in the complaint [that the sales at issue were "`in' commerce" within the meaning of the Robinson-Patman Act] plainly gave the District Court [subject-matter] jurisdiction."); John B. Hull, Inc. v. Waterbury Petro. Prods., Inc., 588 F.2d 24, 27-28 (2d Cir. 1978) (holding that proof of injury to competition is not jurisdictional prerequisite but is part of plaintiffs burden of demonstrating violation of Robinson-Patman Act), cert. denied, 440 U.S. 960 (1979); see also Wheeldin v. Wheeler, 373 U.S. 647, 649 (1963); Bell v. Hood, 327 U.S. 678, 682 (1946); Carlson v. Principal Fin. Group, 320 F.3d 301, 306 (2d Cir. 2003); Zebrowski v. Denckla, 630 F. Supp. 1307, 1309 n. 1 (E.D.N.Y. 1986). Defense counsel has advocated an argument that is contrary to well established precedent of the Supreme Court and the Second Circuit Court of Appeals.
Inasmuch as Colvin noted in its Memorandum of law that it had accepted Tops' invitation to arbitrate the breach of contract claims and that such commenced July 30, Colvin should seek leave to file an Amended Complaint that only addresses its Robinson-Patman claim.
Accordingly, it is hereby ORDERED that defendant's motion to dismiss is denied.