N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
HIP HOP B EVER

A GE C ORPOR

ATION, a Ne va da c orpora tion,

Pla i ntiff-Appe lla

nt,
v. M ONSTER

ENER GY C O M PANY, a De la ware c o rpora tion a

n d DOES, 1 through 10, De fe nda

n ts- Appe lle e s. No. 16-56757 D.C . No. 2:16-c v-01421-SVW -FFM M EM O R ANDUM *

Appe a l from

the Unite d

Sta t e s Distric t C ourt for the C e ntra l Distric t of C a lifornia Ste phe n V. W ilson, Distric t Judge , Pre s iding Argue d a nd Subm itte d on April 9, 2018 Pa sa de n a , C a l ifornia B e fore : B OGGS, * * B YB EE, a nd W ATFORD, C i rc u it Judge s. 1. Hip Hop B e ve ra ge C o rp. (HHB C ) brought suit a ga inst M onste r Ene rgy C o. (M onste r) a lle ging viola tions of the She rm an Ac t , the C l ay ton Ac t, a nd re la te d 

# FIL ED
M AY 07 2018 M OLLY C. DW Y ER, CLERK U

. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public a t ion a

nd is not pre c e de nt e xc e pt a s provide d

by Ninth C irc uit R

ule 36-3.

* * The Honora

ble Da nny J. B oggs, Unite d

Sta t e s C irc uit Judge for the U.S. C ourt of Appe a l s for the Sixth C irc uit, sitting by de signa t ion.Pa ge 2 of 4

sta te la ws. The distric t c ourt dism isse d HHB C ’ s a m e nde d c om pla i nt for fa ilure to sta te a c la im
. 2. HHB C ’ s a

m e nde d c om

pla int fa i le d to a de quat e ly ple a d injury

to
c om pe tition, a s is re quire d to sta te a c la im for a viola tion of the She rm an Ac t or the C la y t on Ac t. W

hile HHB C ’ s a

m e nde d c om

pla i nt ple a de d som e injury to itse lf, it fe ll short of ple a ding injury to c om pe tition ge ne ra lly
. Se e Les Shoc k le y Rac ing, Inc

. v . N at’l Hot Rod Ass’n , 884 F.2d 504, 508 (9th C ir. 1989). M e re injury to HHB C ’ s position a s a

m arke t c om

pe titor is not suffic ie nt. Ibid. And in a c a se
a lle ging a n e xc lusive -de a ling a

rra nge m e nt, HHB C ne e de d to ple a d tha t the
arra nge m e nt “ fore c l ose [d] c om pe tition in a

substa ntia l sha re of the line of
c om m e rc e a ffe c t e d.” Ome

ga Env tl., Inc . v . Gilbarc o , Inc

. , 127 F.3d 1157, 1162 (9th C ir. 1997) (quoting

Tampa Ele c . C

o. v . N ashv ille C o al C o. , 365 U.S. 320, 327 (1961)). “ If c om

pe titors c an re a c h the ultim a te c onsum e rs . . . by e m ploy ing . . .
a lte rna tive c ha

n n e ls of distribution, it is unc le a r whe the r suc h

re s tric tions fore c lose from c om pe tition any pa

rt of the re le va

nt m arke t.” Ome

g a , 127 F.3d a

t 1163. He re , HHB C a lle ge d tha

t (a t m ost) four broke rs re fuse d to do busine ss with HHB C due to M onste r’ s c onduc t. B ut HHB C did not a l le ge how m any tota l broke rs we re in the m arke t

in orde r to e s ta

blish tha t M onste r fore c lose d c om pe tition. M o re ove r, HHB C c onc e de d tha

t HHB C re m a ine d in the m a rke t without the

a ssista nc e ofPa ge 3 of 4

broke rs. HHB C ’ s c onc lusory a sse rtion tha

t c onsum e r pric e s ha d be e n drive n upwa rd wa s insuffic i e nt be c a

u se HHB C did not a lle ge any spe c ific pric ing da

ta or
e xpla in how the m arke t pric e suppose dly inc re a se d. 3. HHB C ’ s a

m e nde d c om

pla int a lso fa ile d to a d e quat e ly ple a d M onste r’ s
m arke t powe r, a s is re quire d to sta te a c la im for a viola t ion of the She rm an Ac t or C la y t on Ac t. Se e Ric k

-Mik Ente rs., Inc ., v . Equilon Enter s. LLC , 532 F.3d 963, 972 (9th C i r. 2008). A firm ha s m arke t powe r whe n , “ by re stric ting its own output, it c an re s tric t m arke twide output a nd, he nc e , inc re a se m a

rke twide pric e s.” Re be l Oil C o., Inc . v . Atl. Ric hfie ld C o. , 51 F.3d 1421, 1434 (9th C ir. 1995). To a lle ge
m arke t powe r c irc um sta

ntia lly , the pla intiff m

u st: “ (1) de fine the re l e va nt m arke t, (2) show tha

t the de fe nda

n t owns a dom ina nt sha re of tha t m a rke t, a nd (3) show that the re are signific ant ba

rrie rs to e ntry

and show tha

t e xisting c om

pe titors la c k the c a pa c ity to inc re a s e the ir output in the short run.” Ibid. While HHB C ’ s
a m e nde d c o m

pla int prope rly de fine d the re le va nt m a rke t, it did not suffic ie ntly
a lle ge tha t M onste r ha d a

dom i na n t sha re of tha t m arke t or tha

t e xisting
c om pe titors la c ke d the c a

pa c ity to inc re a se the i r output to offse t M onste r’ s
c onduc t. The a m e nde d c om pla int m e re ly

sta te d tha t M onste r c ontrolle d a

“ m a jor pe rc e nt” of the e ne rgy -drink m arke t a nd did not a l le ge tha

t othe r “ e ntre nc h e d”
c om pe titors suc h a s R e d B ull a nd R oc ksta

r we re una

ble to inc re a se the ir output toPa ge 4 of 4

offse t M onste r’ s a lle g e d c onduc t. B e c a use the a m e nde d c om

pla int fa ile d

to
a de quate ly

ple a d injury

to c om pe tition or m arke t powe r, it fa ile d to “ sta t e a c la im to re lie f that is pla

usible on its fa c e .” Be l l Atl. C orp. v . Tw ombly , 550 U.S. 544, 570 (2007). 4. W e a lso a ffirm the dism issa l of HHB C ’ s re la te d sta te -law c la im s , inc luding inte rfe re nc e with c ontra c tua l re l a tions, be c a u se t he y are d e rivative of the She rm an A c t
and C la y t on Ac t c la im s. 5. The distric t c o urt di d n o t a b use its disc re tion in dism issing the a m e nde d
c om pla i nt w ith pre

judic e . W he re the a m e nde d c om pla int fa ils to c ure the plea ding de fic ie nc ie s e xpla ine d in the distric t c ourt’ s o rigina l o rde r, “ [t] he distric t c ourt c ould
re a s ona bly c onc lude that furthe r a m e ndm e nt would be fut i le .” Rutman W ine C o. v . E. & J

. Gallo W

ine ry , 829 F.2d 729, 738 (9th C ir. 1987). He re , the distric t c ourt out l in ed the o rigina l c om pla int’ s ple a ding de fic ie nc ie s but HHB C ’ s a m e nde d
c om pla i nt fa ile d to c ure , or e ve n m e aningfully a ddre ss, the de fe c ts note d
. AFFIRM E D.