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Menkes v. St. Lawrence Seaway Pilots' Association

January 17, 2007


The opinion of the court was delivered by: Thomas J. McAVOY, Senior United States District Judge



The plaintiff, Richard J. Menkes, brought this action against the St. Lawrence Seaway Pilots' Association ("SLSPA") alleging violations of federal antitrust law, New York State antitrust law, and Plaintiff's First Amendment right to freedom of association. SLSPA has moved to dismiss the action pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, arguing that the complaint fails to state a claim upon which relief can be granted. Plaintiff has opposed this motion.


The pending motion tests the sufficiency of the claims pleaded in the complaint. As the Supreme Court has held, "a complaint must only include 'a short and plain statement of the claim showing that the pleader is entitled to relief.'" Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512 (2002) (quoting Fed. R. Civ. P. 8(a)). "This simplified notice pleading relies on liberal discovery rules and summary judgment motions to define disputed facts and issues and to dispose of unmeritorious claims." Id. Thus, a complaint is sufficient if it gives the defendant fair notice of the plaintiff's claims, the grounds upon which they rest, and states claims upon which relief could be granted. Id. at 514. Claims brought pursuant to the federal antitrust laws are not subject to a heightened pleading requirement. See Twombly v. Bell Atlantic Corp., 425 F.3d 99, 108 (2d Cir. 2005).

On a Rule 12(b)(6) motion, the Court accepts as true all factual allegations in the complaint. See Leatherman v. Tarrant County Narcotics Intelligence & Coordination Unit, 507 U.S. 163, 164 (1993). "Further, the court should construe the complaint liberally and draw inferences from the plaintiff's allegations in the light most favorable to the plaintiff." Tomayo v. City of N.Y., 2004 WL 137198, at * 5 (S.D.N.Y. Jan. 27, 2004)(citing Desiderio v. National Ass'n of Sec. Dealers, Inc., 191 F.3d 198, 202 (2d Cir. 1999)). However, 'sweeping legal conclusions cast in the form of factual allegations' do not suffice to state a claim even at the Rule 12(b)(6) stage. 5A Charles Alan Wright et al., FEDERAL PRACTICE AND PROCEDURE § 1357 (2d ed. 1990). 'While the pleading standard is a liberal one, bald assertions and conclusions of law will not suffice.' Leeds v. Meltz, 85 F.3d 51, 53 (2d Cir. 1996).

Law Offices of Curtis V. Trinko, L.L.P. v. Bell Atlantic Corp., 309 F.3d 71, 74 (2d Cir. 2002). Thus, the complaint must allege sufficient facts that would make the pleaded legal theories plausible. See Twombly, 425 F.3d at 111 ( "The factual predicate that is pleaded does need to include [antitrust] conspiracy among the realm of plausible possibilities. If a pleaded conspiracy is implausible on the basis of the facts as pleaded - if the allegations amount to no more than "unlikely speculations" - the complaint will be dismissed.); Todd v. Exxon Corp., 275 F.3d 191, 200 (2d Cir. 2001)("To survive a Rule 12(b)(6) motion to dismiss [in a Sherman Act case], an alleged product market must [inter alia ] . . . be 'plausible.' ") (citing Hack v. President & Fellows of Yale Coll., 237 F.3d 81, 86 (2d Cir.2000), cert. denied, 534 U.S. 888, 122 S.Ct. 201, 151 L.Ed.2d 142 (2001)); see also Associated Gen. Contractors of California, Inc. v. Cal. State Council of Carpenters, 459 U.S. 519, 526 (1983)(It would be improper "to assume that the [plaintiff] can prove facts that it has not alleged or that the defendants have violated the antitrust laws in ways that have not been alleged.").

In deciding a Rule 12(b)(6) motion, review "is generally limited to the facts and allegations that are contained in the complaint and in any documents that are either incorporated into the complaint by reference or attached to the complaint as exhibits." Blue Tree Hotels Inv., Ltd. v. Starwood Hotels & Resorts Worldwide, Inc., 369 F.3d 212, 217 (2d Cir. 2004)(citations omitted). However, the Court may also look to public records, including complaints filed in other courts. Id. (citations omitted). Dismissal is appropriate only where "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief," Phillip v. Univ. of Rochester, 316 F.3d 291, 293 (2d Cir. 2003)(citation omitted), or where the complaint fails as a matter of law. Phelps v. Kapnolas, 308 F.3d 180, 187 (2d Cir. 2002).


"Plaintiff is duly licensed and qualified to pilot ships and vessels in the St. Lawrence Seaway and Great Lakes, and holds the title of 'Captain.'" Compl. ¶ 2. Plaintiff asserts that he is "a highly skilled and experienced pilot [and] one of only a handful of people who are licensed and qualified to serve as a pilot in the St Lawrence Seaway and Great Lakes." Id. He further asserts that he has served as a pilot in a geographic region known as "District One"*fn1 for over 30 years, id. at ¶ 7, and that "District One is a distinct market for pilots seeking to engage in pilotage activities and there is no reasonable substitute market in the same geographic area." Id. ¶ 8. Because Plaintiff's claims arise within the context of the Great Lakes Pilotage Act of 1960, codified at 46 U.S.C. Chapter 93 ("GLPA"), it is necessary to examine the contours of the GLPA to fully understand his claims.

[T]he current system of pilotage in the Great Lakes and St. Lawrence Seaway area is regulated by the Great Lakes Pilotage Act of 1960. 46 U.S.C. Ch. 93. The Coast Guard prescribes standards for Great Lakes pilots and registers those who meet the statutory requirements for service. 46 U.S.C. § 9303 (2000). The Secretary of Commerce may authorize the formation of a pilotage pool by a voluntary association of U.S. registered pilots to ensure the "efficient dispatching of vessels and rendering of pilotage services." 46 U.S.C. § 9304(a) (2000). When the authorized pilotage pool is not providing adequate pilotage service because of physical or economic inability, the Director of Great Lakes Pilotage may order any U.S. registered pilot to provide pilotage service. 46 C.F.R. § 401.720(b) (2005).

Indeed, the express language of the statute itself grants the Director the authority and discretion to determine if and when the authorized pilotage pool is not providing adequate and efficient pilotage services and, by extension, if and when outside help in the form of independent U.S. registered pilots is required to fill in the gaps. 46 U.S.C. §§ 9304, 9306; 46 C.F.R. §§ 401.300(a)(1), 401.720(b), 402.320(a)(1).

Menkes v. Dep't of Homeland Sec., 402 F. Supp.2d 204, 208 (D.D.C. 2005) (emphasis in original).

Under the pertinent regulations, the Coast Guard approves the number of registered pilots, 46 C.F.R. § 401.220, the nature, organization, and operation of pilotage associations, 46 C.F.R. § 401.320, the organizational structure and working rules for the pilotage pools, 46 C.F.R. § 401.340, and the rates and service standards of pilotage services. 46 C.F.R. § 401.405. The SLSPA, which is alleged to be a "private business association comprised of a combination of non-employee independent members," Compl ¶ 3, is the authorized pilotage pool in District One. Menkes v. Dep't of Homeland Sec., 402 F. Supp.2d at 205, n. 1 ("The Director, pursuant to this authority, authorized the formation of a pool in District One and approved the SLSPA's application to run the pool.")(citing 46 C.F.R. §§ 401.300(a)(1), 402, 320(a)(1)).

In accordance with Coast Guard Regulations, a voluntary association authorized to establish a pilot pool may require registered pilots to authorize the pool to execute a written authorization for the pool to bill for certain services directly relating to performance of actual pilotage services, deduct authorized expenses, and to comply with the working rules and other rules of the pool relating to such facilities and services. At all times material to this case, the Coast Guard has recognized the SLSPA as operating a voluntary pool of pilots working in District One.

Compl. ¶¶ 9-12.

Plaintiff was a member of the SLSPA until December 2000 at which time he resigned. Id. ¶ 18. He sought, at that time, to continue to work in District One as an "independent" pilot, and was registered in this regard by the Coast Guard for the 2001, 2002, and 2003 shipping seasons. Id. at ¶¶ 19, 20. However, Plaintiff contends that "[n]ot long after Plaintiff resigned from SLSPA, . . . and continuing to present, the SLSPA and its officers sought to prevent him from working as an independent registered pilot. Id. ¶ 21. In this regard, Plaintiff alleges that "in a further concerted effort to exclude Plaintiff from work as a non-SLSPA member District One pilot, SLSPA and its members began filing false and malicious complaints to the Coast Guard and others alleging that they feared for their safety at the hands of Plaintiff." Id. ¶ 23. The U.S. Coasts Guard investigated these allegations and found them to be without merit. Id. ¶¶ 24. Consequently, Plaintiff did work as an independent pilot in District One during the 2001-2003 shipping seasons. See Menkes v. Dep't of Homeland Sec., 402 F. Supp. 2d at 206.

Nevertheless, at the end of the 2003 shipping season the Director informed the SLSPA and the plaintiff that his status [as an independent pilot] would not continue for the 2004 season. On January 22, 2004, the Director clarified that the plaintiff's previous status as an independent pilot was not a "permanent circumstance" but that it was "predicated" upon ...

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