United States District Court, W.D. Kentucky, Bowling Green Division
VALERIE POWELL, Administratrix of the Estate of Lenita Cole PLAINTIFF
MACKIE SHELTON; and BARRY DYER DEFENDANTS
MEMORANDUM OPINION AND ORDER
N. STIVERS CHIEF JUDGE.
matter is before the Court on Defendants' Motion to
Dismiss (DN 6). The motion is ripe for decision. For the
reasons provided below, the motion is GRANTED.
an action arising under the Sherman Antitrust Act (“the
Sherman Act”), 15 U.S.C. § 1 et seq., concerning
Defendants' alleged conduct at the public auction for the
Estate of Lenita Cole (“the Estate”) held on
April 21, 2018, for real property located in Scottsville,
Kentucky. (Compl. ¶¶ 3-6, DN 1). Plaintiff Valerie
Powell (“Plaintiff”), who is the daughter of
Lenita Cole and Administratrix of the Estate, alleges that
“during the course of the auction, Defendants
recognized that there was only one (1) competing bidder,
namely Chris Shockley [(“Shockley”)] who was
bidding on behalf of his farm partnership.” (Compl.
¶ 8). Plaintiff claims that Defendant Barry Dyer
(“Dyer”) approached Shockley and demanded that
Shockley pay Defendants $40, 000 or else they would continue
bidding on the property. (Compl. ¶ 8). Shockley and his
farming partner, Jason Williams (“Williams”),
allegedly agreed to pay $40, 000 to acquire the property free
of competing bids from Defendants. (Compl. ¶ 9).
Shockley and Williams ultimately paid $492, 200 for the
property upon placing the highest bid at the auction. (Compl.
“the [E]state investigated the matter and concluded
that it was deprived of $158, 200 as a result” of
Defendants' conduct. (Pl.'s Resp. 2). Plaintiff
reaches this conclusion because “Shockley and Williams
were prepared to pay up to . . . $650, 400” for the
property, compared to the $492, 200 they ultimately paid.
(Compl. ¶ 10). As a result, Plaintiff alleges that she
and her brother-who is also a beneficiary of the Estate and a
resident of Tennessee-were each deprived of $79, 100.
(Pl.'s Resp. 2).
initiated the present action pursuant to 15 U.S.C. § 15
seeking to recover treble damages as well as reasonable
attorneys' fees and litigation costs. (Compl.
¶¶ 12-13). Defendants move to dismiss
Plaintiff's Complaint on two grounds. First, Defendants
argue the Court lacks subject matter jurisdiction because
“Plaintiff must establish a nexus between
[Defendants'] conduct and interstate commerce in order to
bring a Sherman Act violation case.” (Defs.' Mot.
Dismiss 2, DN 6). Since the Estate was being probated in
Kentucky, and because Defendants, Plaintiff, Shockley and
Williams are all residents of Kentucky, Defendants
“request this Court to dismiss this case for lack of
subject matter jurisdiction [because] the transaction . . .
was purely intrastate and did not have a substantial impact
on interstate commerce.” (Defs.' Mot. Dismiss 3).
Second, Defendants contend Shockley and Williams are
indispensable parties to this action under Fed.R.Civ.P.
19(a)(1) whose non-joiner warrants dismissal. (Defs.'
Mot. Dismiss 3-4).
response, Plaintiff asserts that Defendants' conduct
affects interstate commerce “given that the beneficiary
residing in Tennessee was deprived of $79, 000 or more as a
result of Defendants' wrongdoing.” (Pl.'s Resp.
Defs.' Mot. Dismiss 4, DN 8 [hereinafter Pl.'s
Resp.]). Regarding Defendants' motion to join Shockley
and Williams as indispensable parties, Plaintiff argues
“Defendants have merely made conclusory statements
unsupported by any specific facts or legal arguments”
and “the law is clear that potential joint tortfeasors
are only permissive parties.” (Pl.'s Resp. 6).
STANDARD OF REVIEW
to dismiss for lack of subject matter jurisdiction under
Fed.R.Civ.P. 12(b)(1) fall into two categories: facial
attacks and factual attacks. United States v.
Ritchie, 15 F.3d 592, 598 (6th Cir. 1994). Facial
attacks challenge subject matter jurisdiction as to the
sufficiency of the pleadings, and a Court will consider the
material allegations in the complaint as true and construe
them in the light most favorable to the nonmoving party.
Id. Factual attacks challenge subject matter
jurisdiction as to the facts alleged in the pleadings, and in
such situations, courts weigh conflicting evidence and
resolve factual disputes in determining whether there is
jurisdiction. Id. “Subject matter jurisdiction
is always a threshold determination.” Am. Telecom
Co. v. Republic of Lebanon, 501 F.3d 534, 537 (6th Cir.
2007) (citation omitted). In most circumstances, the
plaintiff bears the burden to survive Fed.R.Civ.P. 12(b)(1)
motions to dismiss. See Bell v. Hood, 327 U.S. 678,
681-82 (1946). “If the court determines at any time
that it lacks subject-matter jurisdiction, the court must
dismiss the action.” Fed.R.Civ.P. 12(h)(3).
Defendants challenge the Court's subject matter
jurisdiction over Plaintiff's claim based on the
sufficiency of her pleadings, this is a facial attack. See
Ritchie, 15 F.3d at 598. The Court will accordingly consider
the material allegations in Plaintiff's Complaint as true
and construe them in her favor. See id.
1 of the Sherman Act provides: “Every contract,
combination in the form of trust or otherwise, or conspiracy,
in restraint of trade or commerce among the several States,
or with foreign nations, is declared to be illegal.” 15
U.S.C. § 1. In conjunction with this, Congress has
created a private cause of action for “any person who
shall be injured in his business or property by reason of
anything forbidden in the antitrust laws. . . .” 15
U.S.C. § 15(a). To state such a private cause of action,
Plaintiffs must plead facts demonstrating three elements:
“(1) the existence of a contract, combination, or
conspiracy (2) affecting interstate commerce (3) that imposes
an unreasonable restraint on trade.” Churchill
Downs Inc. v. Thoroughbred Horsemen's Grp., LLC, 605
F.Supp.2d 870, 887 (W.D. Ky. 2009) (citations omitted).
action, Plaintiff has alleged an oral contract formed between
Defendants and Shockley in satisfaction of the first element.
Plaintiff has also made allegations that satisfy the third
element because she accuses Defendants of bid rigging-a
practice which has long been barred as an unreasonable,
horizontal restraint on trade and a per se violation of
Section 1 of the Sherman Act. See, e.g., Expert Masonry,
Inc. v. Boone Cty., Ky., 440 F.3d 336, 344 (6th Cir.
2006) (citations omitted); United States v. W.F. Brinkley
& Son Constr. Co., 783 F.2d 1157, 1161 (4th Cir.
1986) (“[W]here two or more persons agree that one will
submit a bid for a project higher or lower than the others or
that one will not submit a bid at all, then there has been an
unreasonable restraint on trade which violates the Sherman
Antitrust Act.”); United States v. Koppers
Co., 652 F.2d 290, 294 (2d Cir. 1981) (“[I]n cases
involving behavior such as bid rigging, which has been
classified by courts as a per se violation, the Sherman Act
will be read as simply saying: ‘“An agreement
among competitors to rig bids is illegal.”'”
their motion, Defendants do not challenge Plaintiff's
allegations under either the first or third prongs but focus
instead on the second. Thus, the disputed issue presently
before this Court is whether Plaintiff has alleged facts
indicating that Defendants' alleged bid rigging
conspiracy affected interstate ...