Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.


March 24, 1997


The opinion of the court was delivered by: SOTOMAYOR


 Defendant Trans World Airlines ("TWA") moves pursuant to Fed. R. Civ. P. 12(b)(6) to dismiss plaintiff's Sherman and Lanham Act claims for failure to state a claim. TWA also moves pursuant to Fed. R. Civ. P. 12(b)(7) to dismiss plaintiff's breach of contract and declaratory judgment claims for failure to join an indispensable party under Fed. R. Civ. P. 19(b). For the reasons to be discussed, the motion to dismiss is GRANTED.


 Plaintiff Global Discount Travel Services, LLC ("Global") is a Nevada limited liability company that sells and markets low price, discounted TWA airline tickets. (See Am. Compl. P 3). Defendant TWA is a Delaware corporation with its principal place of business in St. Louis, Missouri. (See id. P 4). TWA is a major airline that provides both domestic and international air transportation.

 Global is controlled by Carl Icahn, who also owns or controls a number of other non-party business entities that, together with Global, are referred to in the Amended Complaint as the "Icahn Companies." (Id. at P 8). One of the non-party companies is the Karabu Corporation ("Karabu"). TWA and Karabu are parties to a Karabu Ticket Program Agreement ("the Ticket Agreement") and to "loan agreements [("the Extension and Consent Agreements")] pursuant to which the Icahn Companies extended $ 200 million in loans to TWA." (Id. P 9).

 The present action arises from a dispute between TWA and the Icahn Companies over the proper interpretation of the Ticket Agreement. TWA alleges that under the agreements, Karabu, Icahn, and certain other affiliates secured the right to sell certain types of discounted TWA tickets to specified customers in return for Karabu and Icahn extending the maturity date of the outstanding loans made to TWA. (See Def.'s Mem. at 2-3). Global alleges that the "Ticket Agreement specifically contemplates the right of other companies controlled by Carl Icahn to execute a Joinder Agreement, pursuant to which such companies are viewed as signatories to the Karabu Agreement, and thereby acquire the same rights that Karabu has under the Ticket Agreement." (Am. Compl. P 11).

 On or about August 14, 1995, Global executed a Joinder Agreement and elected to join itself as a party to the Ticket Agreement. (See id.). TWA alleges that "the parties agreed to substantial restrictions on Karabu's and Icahn's rights to sell discounted TWA airline tickets." (Def.'s Mem. at 3). It contends that "Icahn and Karabu, through Global Discount and Global Travel, were selling certain of the discounted tickets (the 'System Tickets') to the general public in contravention of the Ticket Agreement." (Id.). Pursuing these theories, TWA filed a declaratory judgment and breach of contract action in a Missouri state court against all of the Icahn companies, including plaintiff and Karabu. (See Def.'s Mem. at 1). Global in this action argues that "as a party to the Ticket Agreement, [it] may sell tickets through Independent Travel Agents to any 'End User.'" (Am. Compl. P 13). *fn1"

 Global contends that TWA has "secretly sought out and punished Independent Travel Agents doing business with Global." (Id. P 16). It alleges that TWA has coerced numerous Independent Travel Agents ("ITAs") throughout the United States "into ending or limiting the marketing and/or sale of the low price, discounted TWA airline tickets offered by Global." (Id. at 17). Global further maintains that TWA and the ITAs have entered into a conspiracy "to refrain from doing business with Global, or to limit the amount of business they will do with it." (Id.). In addition, Global contends that TWA has "intentionally and falsely claimed to numerous Independent Travel Agents that its competitor, Global, does not have the right under the Ticket Agreement to sell System Tickets to any person who actually uses the ticket, i.e., an 'End User.'" (Id. P 58). Global claims that the alleged breach of contract by TWA, and purported violations of sections 1 and 2 of the Sherman Act and the Lanham Act have caused it to suffer economic injury.


 I. Sufficiency of a Complaint Under Rule 12(b)(6)

 A district court's function on a motion to dismiss under Fed. R. Civ. P. 12(b)(6) is to assess the legal feasibility of the complaint. Kopec v. Coughlin, 922 F.2d 152, 155 (2d Cir. 1991). The issue "is not whether a plaintiff will ultimately prevail, but whether the claimant is entitled to offer evidence to support the claims." Scheuer v. Rhodes, 416 U.S. 232, 236, 40 L. Ed. 2d 90, 94 S. Ct. 1683 (1974). Allegations contained in the complaint must be construed favorably to the plaintiff. See Walker v. New York, 974 F.2d 293, 298 (2d Cir. 1992), cert. denied, 507 U.S. 961, 113 S. Ct. 1387, 122 L. Ed. 2d 762 (1993). Dismissal is warranted only where "it appears beyond doubt that the plaintiff can prove no set of facts in support of his [or her] claim that would entitle him [or her] to relief." Ricciuti v. NYC Transit Authority, 941 F.2d 119, 123 (2d Cir. 1991) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 2 L. Ed. 2d 80, 78 S. Ct. 99 (1957) (footnote omitted)).

 In considering a Rule 12(b)(6) motion, a court must look to: (1) the facts stated on the face of the complaint; (2) documents appended to the complaint; (3) documents incorporated in the complaint by reference; and (4) matters of which judicial notice may be taken. See Hertz Corp. v. City of New York, 1 F.3d 121, 125 (2d Cir. 1993) (citing Allen v. WestPoint-Pepperell, Inc., 945 F.2d 40, 44 (2d Cir. 1991)); see also Samuels v. Air Transport Local 504, 992 F.2d 12, 15 (2d Cir. 1993) (same).

 II. The Sherman Antitrust Claims

 A. Rule 12(b)(6) Standard in Antitrust Cases

 "[A] short plain statement of a claim for relief which gives notice to the opposing party is all that is necessary in antitrust cases, as in other cases under the Federal Rules." George C. Frey Ready-Mixed Concrete, Inc. v. Pine Hill Concrete Mix Corp., 554 F.2d 551, 554 (2d Cir. 1977). This does not mean that "conclusory allegations which merely recite the litany of antitrust ... will suffice." John's Insulation, Inc. v. Siska Constr. Co., 774 F. Supp. 156, 163 (S.D.N.Y. 1991); see also International Audiotext Network, Inc. v. AT&T Co., 893 F. Supp. 1207, 1211 (S.D.N.Y. 1994), aff'd 62 F.3d 69 (1995). An antitrust complaint must "adequately ... define the relevant product market, ... allege antitrust injury, [and] ... allege conduct in violation of antitrust laws." Re-Alco Indus., Inc. v. National Ctr. for Health Educ., Inc., 812 F. Supp. 387, 391 (S.D.N.Y. 1993). In considering the complaint under Fed. R. Civ. P. 12(b)(6), "the Court must accept the pleader's allegations of facts as true together with such reasonable inferences as may be drawn in [the pleader's] favor." International Audiotext Network, Inc., 893 F. Supp. at 1211 (citing Deep South Pepsi-Cola Bottling Co. v. PepsiCo, Inc., 1989 U.S. Dist. LEXIS 4639, 1989 ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.