Volvo North America Corporation, International Merchandising Corporation, and Proserv, Inc. v. Men's International Professional Tennis Council, M. Marshall Happer, Iii, and Philippe Chatrier, Men's International Professional Tennis Council and M. Marshall Happer, Iii, Counterclaimants v. Volvo North America Corporation, International Merchandising Corporation, and Proserv, Inc., Counterclaim-Defendants v. Donald L. Dell, Raymond S. Benton, Dell, Benton & Falk, Mark H. McCormack International Merchandising Group, International Management Inc., Transworld International Inc., and A.B. Volvo, Additional Counterclaim-Defendants

This is an appeal from so much of an order entered in the United States District Court for the Southern District of New York, Kevin Thomas Duffy, Judge, as dismissed Counts One through Seven of an amended complaint filed by appellants Volvo North America Corporation ("Volvo"), International Merchandising Corporation ("IMC"), and ProServ, Inc. ("ProServ"), for failure to state a claim upon which relief can be granted. See Volvo N. Am. Corp. v. Men's Int'l Professional Tennis Council, 678 F.Supp. 1035 (S.D.N.Y.1987), appeal dismissed in part, 839 F.2d 69 (2d Cir.1988). Counts One through Five allege that appellees, the Men's International Professional Tennis Council ("MIPTC"), its chairman, Philippe Chatrier, and its administrator, M. Marshall Happer, III, have conspired in violation of Secs. 1 and 2 of the Sherman Act, 15 U.S.C. Secs. 1, 2 (1982), to monopolize and restrain trade in the markets for the production of men's professional tennis events, the tennis-playing services of men's professional tennis players, and the rights to broadcast men's professional tennis events. Counts Six and Seven allege pendent state law claims for tortious interference with prospective business relations and unfair competition. For the reasons stated below, we vacate the dismissal of certain of appellants' antitrust and common law claims and remand with instructions to dismiss these claims with leave to replead; and we reverse as to the remaining claims on appeal.

* A. The Business of Men's Professional Tennis

According to the amended complaint, the production of a men's professional tennis event requires: (1) selecting a site and arranging for a suitable facility for the event; (2) marketing the event; and (3) raising revenue to cover the costs of the event through the sale of sponsorship rights, the sale of tickets to attend the event, the sale of concessions, programs, or other products at the event, and the sale of rights associated with the event, including the rights to broadcast the event on television. The production of a men's professional tennis event often involves several different participants. The "owner" of the event is the person or entity that is obligated to pay the expenses of the event, including compensation to the players and the costs for the facility or site where the event is played, and that is entitled to receive the revenues generated by the event. Frequently, the owner of an event will contract with a third person, such as a player-agent, to advertise or market the event or certain rights associated with the event, or to manage the day-to-day operation of the event. An event also may have several different "sponsors," including: (a) a title sponsor, which purchases the right to have its name included in the title of the event; (b) a presenting sponsor, which purchases the right to have the event identified and advertised as an event that is "presented by" this sponsor; and (c) secondary sponsors, which pay for specific subsidiary sponsorship rights, such as the right to have the sponsor's product identified as the official product of the event. Volvo is an owner, producer, and sponsor of certain men's professional tennis events. IMC and ProServ own and produce certain tennis events, and also provide representational and management services to men's professional tennis players.

At the present time, men's professional tennis events fall into one of two categories. The first category consists of events that are sanctioned by either MIPTC or the International Tennis Federation ("ITF"). These events include the Davis Cup events and the "Grand Prix" events; the latter consist of (1) the four "Grand Slam" tournaments, that is, Wimbledon, the U.S. Open, the French Open, and the Australian Open; (2) the Masters Tournament; (3) the World Championship Tennis Finals; (4) "Super Series" events; (5) "Regular Series" events; and (6) "Open Week Series" events. The second category consists of tournaments known as "Special Events," which include all events other than MIPTC- or ITF-sanctioned events and the Davis Cup events. Until recently, Volvo owned, produced, and sponsored only sanctioned events; IMC and ProServ, on the other hand, have owned and produced both sanctioned events and Special Events.1

B. The Recent History of Men's Professional Tennis

The amended complaint alleges that, up until the late 1960's, only amateur tennis players were allowed to compete in the prestigious men's tennis tournaments sanctioned by ITF, a governing body that consists of various national tennis associations, including the United States Tennis Association. In the late 1960's, however, a rival organization, World Championship Tennis, Inc. ("WCT"), began sponsoring a series of men's professional tennis tournaments to compete with the events sanctioned by ITF. A substantial number of top men's tennis players thereafter turned professional and began to participate in WCT-sponsored events. In response, ITF eventually changed its rules to permit professional players to compete in ITF-sanctioned tournaments. In 1974 ITF joined in establishing MIPTC, which currently consists of nine members: three members representing ITF; three members representing men's professional tennis players; and three members representing men's professional tennis tournament directors. As noted above, MIPTC sanctions and schedules the tournaments that comprise the Grand Prix.

From 1974 to 1981, MIPTC increased the number of its Grand Prix events from fifty to ninety. At the same time, MIPTC began to require men's professional tennis players, as a condition of their participation in any Grand Prix event, to execute "Commitment Agreements" which required the players to participate in a minimum number of Grand Prix events, and to limit their participation in events not sanctioned by MIPTC. As a result, WCT agreed to obtain MIPTC sanctions for its entire circuit of events. By 1981, WCT owned eight Grand Prix events sanctioned by MIPTC.

In 1981, a dispute arose between MIPTC and WCT over the terms and conditions of WCT's continued participation in the Grand Prix. WCT withdrew from the Grand Prix in April, 1981, and unsuccessfully attempted to establish its own independent tennis circuit for 1982. WCT thereafter commenced an action in the United States District Court for the Southern District of New York, alleging that MIPTC, ITF, and the Association of Tennis Professionals had violated the antitrust laws by engaging in a combination to monopolize the production and presentation of championship caliber men's professional tennis throughout the world. The lawsuit was settled in the fall of 1983, and WCT events were integrated into the Grand Prix. The resulting agreement (the "MIPTC-WCT Agreement") provided, inter alia, that: (1) MIPTC would sanction a specified minimum number of WCT tournaments; (2) MIPTC would give the WCT tournaments scheduling and sanctioning protection and priority; (3) WCT would not sponsor, own, or promote any Special Event or Grand Prix event that might adversely affect another Grand Prix event without prior MIPTC approval; (4) if certain conditions were satisfied, WCT would terminate its involvement in the business of acting as an agent or representative of men's professional tennis players; (5) if WCT decided to operate its WCT Tournament of Champions or its WCT World Doubles Championship as Special Events, MIPTC would (a) exempt these events from all Special Event restrictions, (b) continue to grant these events scheduling priority, and (c) exempt all players from any rules that would restrict their participation in these events; (6) MIPTC would limit the number of events it would sanction; (7) MIPTC would alter the players' Commitment Agreements to require all players who qualified to participate in the WCT Finals; (8) MIPTC would increase the minimum number of MIPTC-sanctioned events in which players would be required to participate; (9) MIPTC would use its power over the services of men's professional tennis players to encourage players to participate in both WCT and other MIPTC events; (10) MIPTC and WCT would fix minimum and maximum levels of compensation to be offered to players at WCT events; and (11) MIPTC rules would be altered to provide that no Super Series event would be held in the same week as a WCT event.2

3. Volvo's Involvement with Men's Professional Tennis

Volvo began its involvement in professional tennis in 1973 with a small tournament in New Hampshire known as the Volvo International Tennis Tournament. Volvo began producing and sponsoring the Washington, D.C. Volvo Classic tennis tournament in 1975 and the Volvo Tennis Games in Palm Springs, California in 1979. Late in 1979 Volvo agreed to become the overall sponsor of the entire series of Grand Prix tournaments for the years 1980, 1981, and 1982, with the option to sponsor the Grand Prix for 1983 and 1984. Volvo exercised its option to continue sponsoring the Grand Prix in 1983 and 1984, and offered to continue its overall sponsorship of the Grand Prix into the future. However, in February, 1984, MIPTC announced that it was awarding the Grand Prix sponsorship for 1985 to Nabisco Brands, Inc.

Relations between Volvo and MIPTC began to sour shortly after MIPTC chose to award the Grand Prix sponsorship to Nabisco. For several years the Masters Tournament, the final event of the annual Grand Prix series, had been held in Madison Square Garden in the week following professional football's Super Bowl. Although Volvo's right to sponsor the Grand Prix was to end in 1984, Volvo had acquired contractual rights to the use of Madison Square Garden for the Masters Tournament week in January, 1985. Volvo also entered into contractual commitments with the National Broadcasting Company ("NBC") for the televising of a men's professional tennis event during that week in future years. In response, appellee Philippe Chatrier, chairman of MIPTC, sent a letter to Volvo claiming that Volvo's negotiation of these contracts was legally improper and unethical. In January, 1985, Volvo agreed to assign its rights under the contracts with Madison Square Garden and NBC to MIPTC. In return, MIPTC agreed to approve Volvo's application for a sanction for the production of a tennis event at a site to be selected by Volvo, on the condition that Volvo sponsor no Special Events in North America during weeks in which Grand Prix tournaments were being conducted or in any city in which a Grand Prix event was held. In addition, the contract provided that MIPTC and Volvo would cooperate with each other's reasonable promotional activities.

Volvo claims, however, that despite the foregoing agreement to cooperate, appellee M. Marshall Happer, III, the administrator of MIPTC, embarked on a campaign to "dissuade and intimidate" tournament owners and producers from associating with Volvo or permitting Volvo to participate in the ownership, production, and sponsorship of Grand Prix events. Volvo also alleges that Happer sent letters to NBC Sports, Public Broadcasting Service, ESPN (a cable television sports network), and USA Network claiming that Volvo was attempting to mislead the public into believing that it was still the overall sponsor of the Grand Prix. Happer requested that the networks not permit Volvo to use its logo, a depiction of a tennis ball resting against the head of a racket, during their telecasts of any Grand Prix events.

In April, 1985, Volvo filed a complaint in the United States District Court for the Southern District of New York, alleging federal antitrust and common law claims against MIPTC, Chatrier, and Happer. In September, 1985, IMC and ProServ, two sports management companies that provide representational and management services to tennis players and produce and own certain men's professional tennis events, joined Volvo as plaintiffs when an amended complaint was filed.

The amended complaint alleges, inter alia, that appellees have violated Secs. 1 and 2 of the Sherman Act, 15 U.S.C. Secs. 1, 2 (1982), by conspiring to monopolize and restrain trade in the market for men's professional tennis. Appellants claim that this market includes: (1) the submarket for the production of men's professional tennis events; (2) the submarket for the tennis-playing services of men's professional players; and (3) the submarket for the rights to broadcast men's professional tennis events on television in the United States. Appellants identify several ways in which MIPTC allegedly has violated the Sherman Act.

First, appellants allege that MIPTC's administration of the Grand Prix has violated the Sherman Act in at least three ways. The amended complaint states that appellants, in their capacity as owners and producers of sanctioned events, "have been denied the opportunity to produce tennis events in the manner they seek, with respect to matters such as site location, player compensation and scheduling." With respect to player compensation in particular, the amended complaint states that MIPTC will not sanction a tournament unless the owner agrees to a ceiling on player compensation.

Next, appellants claim that MIPTC has "further inhibited the development of events that could compete effectively with them by coercing WCT to agree, in the MIPTC-WCT Agreement, not to own or become involved in promoting any Special Event that adversely affects any MIPTC-sanctioned event, without prior approval from the MIPTC." Appellants also assert that "the MIPTC-WCT Agreement gave the WCT competitive advantages, and used the MIPTC's monopoly power to benefit the WCT," insofar as the Agreement "included covenants not to compete and agreements between horizontal competitors to divide markets, fix prices, limit output, and limit outside competition."

Further, appellants contend that MIPTC has decreased the number of non-sanctioned tournaments in which players may compete by requiring all players who wish to participate in Grand Slam events to sign Commitment Agreements which include certain restrictive provisions. A player signing a Commitment Agreement agrees to participate in a minimum of fourteen Grand Prix events, and in the Masters Tournament or the WCT Finals, if he so qualifies. According to appellants, this restriction prevents players from competing in non-sanctioned tournaments for up to twenty-one weeks out of the year. The player also agrees not to participate in any Special Event that is held in the same week as, inter alia, a Grand Slam event, the Masters Tournament, or the WCT Finals. According to appellants, this requirement prevents players from participating in Special Events during sixteen weeks out of the year. In addition, the player agrees not to participate in any Special Event that is held within thirty days of a Grand Slam event, the Masters Tournament, the WCT Finals, or any Super Series event if the Special Event is held within one hundred miles of that event. And still further, no player may participate in more than four Special Events that are held during the same week and on the same continent as one of the MIPTC Super Series events.

Appellants also allege that MIPTC requires the owners and producers of sanctioned events to agree to contribute to a "bonus pool," which provides additional compensation to players who perform well at sanctioned events throughout the course of the year. This latter requirement provides players with an additional incentive to maximize their participation in sanctioned events.

Finally, appellants claim that certain proposed restrictions would further limit their ability to compete in the market for men's professional tennis events. Among these proposed rules is a "Special Event" Rule, which would require all owners, agents, consultants, and associates of a sanctioned event to agree not to "promote" any Special Event during the week of any Grand Prix tournament. Since Grand Prix tournaments occupy forty-eight weeks of the year, this rule allegedly would preclude any person associated with an existing sanctioned event from producing any Special Events at all. There is also a proposed rule, known as the "Best Interest" Rule, which would give MIPTC the right to refuse to sanction any event whenever "in the sole judgment of the MIPTC" sanctioning that event would not serve "the best interest of the sport." Another proposal, the "Conflicts of Interest" Rule, would allow MIPTC to prohibit owners and producers from inviting certain players to participate in their tournaments as "wild cards."3 And last, there is a proposed rule that would permit MIPTC to serve as the exclusive representative and agent for the pooled sale of television broadcasting rights to sanctioned events.

Appellants claim that, as a result of the foregoing restrictions, they have been injured in their capacities as owners and producers, or potential owners and producers, of Special Events, as well as in their capacities as owners and producers of sanctioned events. IMC and ProServ claim that MIPTC's rules have injured them in their capacities as owners and producers of Special Events in three ways: by restricting the ability of IMC and ProServ to obtain a sufficient supply of players' services for Special Events; by causing them to own and produce fewer Special Events than they otherwise would have owned and produced; and by causing the Special Events which they do own or produce to have been less profitable than they otherwise would have been. Volvo claims that it has been injured in similar fashion, but only in its capacity as a potential owner and producer of Special Events. All three appellants claim that they have been injured in their capacities as owners and producers of MIPTC-sanctioned events, primarily because compliance with the foregoing rules has limited their ability "to compete freely and vigorously with the events owned and produced by the defendants and their co-conspirators."

Five counts of the complaint set forth appellants' various theories of antitrust liability. Count One of the complaint states that appellees' activities constitute a group boycott of, and a concerted refusal to deal with, owners, producers, sponsors, player-agents, and players who refuse to agree to abide by the terms and conditions prescribed by appellees, in violation of Sec. 1. Count Two alleges that the foregoing rules are part of, and in furtherance of, a combination and conspiracy unreasonably to restrain trade in men's professional tennis, in violation of Sec. 1. Count Three alleges that appellees' activities constitute the willful acquisition and maintenance of monopoly power, in violation of Sec. 2. Count Four states that appellees' conduct demonstrates an attempt to monopolize, in violation of Sec. 2, and Count Five alleges a conspiracy to monopolize, also in violation of Sec. 2. Appellants also allege that MIPTC has tortiously interfered with their prospective business relations (Count Six), and has engaged in unfair competition (Count Seven). In addition, Volvo states claims for breach of contract, fraud, defamation, and product disparagement (Counts Eight through Thirteen).

In response, appellees filed a motion to dismiss the amended complaint on several grounds: they sought to dismiss appellants' challenge to the proposed MIPTC rules pursuant to Fed.R.Civ.P. 12(b)(1) on the ground that this challenge was not ripe; they sought to dismiss the antitrust claims pursuant to Fed.R.Civ.P. 12(b)(6) on the ground that appellants had not adequately alleged antitrust injury; they sought to dismiss the pendent state law claims for lack of subject matter jurisdiction, pursuant to Fed.R.Civ.P. 12(b)(1); and they sought to dismiss the fraud claims pursuant to Fed.R.Civ.P. 9(b) for failure to plead fraud with particularity.

In an opinion dated August 10, 1987, Judge Duffy granted the motion to dismiss Counts One through Seven and Thirteen, and he dismissed with leave to replead Counts Eight through Twelve. In dismissing the amended complaint, however, Judge Duffy did not rely primarily on the arguments raised by appellees in support of the motion to dismiss. Instead, he dismissed every count of the complaint, except the counts claiming breach of contract and fraud, on the ground that appellants had failed to state a claim upon which relief could be granted. The court dismissed Counts One and Two, which claimed violations of Sec. 1 of the Sherman Act, on the grounds that appellants had failed to allege another party with whom appellants conspired to restrain trade, 678 F.Supp. at 1039, and that none of the conduct alleged in the amended complaint constituted unreasonable restraints of the men's professional tennis market. Id. at 1042-43. Judge Duffy dismissed Count Three, the monopolization claim, on the ground that MIPTC did not possess monopoly power, id. at 1043; he did not expressly address the merits of Count Four, the attempted monopolization claim, or Count Five, the claim based on conspiracy to monopolize. Count Six, the tortious interference claim, was dismissed on the ground that appellants had not alleged any business relations between themselves and a third party that were harmed by appellees' behavior. Id. at 1044. The court dismissed Count Seven, the unfair competition claim, for failure to allege that appellees had misappropriated appellants' property, id. at 1044-45, and Count Thirteen, the product disparagement claim, for failure to allege special damages, id. at 1046. The remaining counts were dismissed with leave to replead.

Appellants thereafter appealed with respect to Counts One through Seven and Thirteen, pursuant to 28 U.S.C. Sec. 1292(a)(1) (1982). This court denied appellees' motion to dismiss the appeal with respect to Counts One through Seven and granted the motion to dismiss the appeal with respect to Count Thirteen. See 839 F.2d at 77. Now, on appeal, Volvo, IMC, and ProServ claim (1) that the district court erred by dismissing their claims, without leave to amend, on grounds neither raised by appellees nor briefed by appellants below; (2) that they have adequately alleged antitrust injury as well as the necessary elements to support their claims under Secs. 1 and 2 of the Sherman Act; and (3) that the court erred in dismissing the tortious interference count. IMC and ProServ also argue on appeal that the district court erred in dismissing the unfair competition claim--Volvo, however, has chosen to withdraw its unfair competition claim.

Appellees moved to dismiss appellants' challenge to MIPTC's four proposed rules on the ground that this challenge was not ripe for adjudication. The district court did not address this argument, and appellees have not raised it on appeal. Nevertheless, to the extent that "issues of ripeness involve, at least in part, the existence of a live 'Case or Controversy,' " Regional Rail Reorg. Act Cases, 419 U.S. 102, 138, 95 S.Ct. 335, 356, 42 L.Ed.2d 320 (1974) (footnote omitted), we should consider such issues sua sponte. See, e.g., Suburban Trails, Inc. v. New Jersey Transit Corp., 800 F.2d 361, 365 (3d Cir.1986); American Trucking Ass'ns v. I.C.C., 747 F.2d 787, 790 (D.C.Cir.1984); Johnson v. Sikes, 730 F.2d 644, 647-48 (11th Cir.1984); 13A C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure Sec. 3532.1, at 135 (2d ed. 1984) ("Wright, Miller & Cooper").

As the Supreme Court has noted, the purpose of the ripeness doctrine " 'is to prevent the courts, through premature adjudication, from entangling themselves in abstract disagreements.' " Thomas v. Union Carbide Agric. Prods. Co., 473 U.S. 568, 580, 105 S.Ct. 3325, 3332, 87 L.Ed.2d 409 (1985) (quoting Abbott Laboratories v. Gardner, 387 U.S. 136, 148, 87 S.Ct. 1507, 1515, 18 L.Ed.2d 681 (1967)). Ripeness therefore " 'is peculiarly a question of timing,' " id. (quoting Regional Rail Reorg. Act Cases, 419 U.S. at 140, 95 S.Ct. at 357), and it cautions courts against adjudicating " 'contingent future events that may not occur as anticipated, or indeed may not occur at all,' " id. at 580-81, 105 S.Ct. at 3333 (quoting Wright, Miller & Cooper Sec. 3532). Two additional factors, " 'the fitness of the issues for judicial decision' " and " 'the hardship to the parties of withholding court consideration,' " also inform any analysis of ripeness. Id. at 581, 105 S.Ct. at 3333 (quoting Abbott Laboratories, 387 U.S. at 149, 87 S.Ct. at 1515). The fitness of an issue for judicial decision depends at least in part on the extent to which the issue is "purely legal, and will not be clarified by further factual development." Id.; see also Abbott Laboratories, 387 U.S. at 149, 87 S.Ct. at 1515. In considering the hardship to the parties of withholding consideration, a court must be mindful that " '[o]ne does not have to await the consummation of threatened injury to obtain preventive relief. If the injury is certainly impending, that is enough.' " Regional Rail Reorg. Act Cases, 419 U.S. at 143, 95 S.Ct. at 358 (quoting Pennsylvania v. West Virginia, 262 U.S. 553, 593, 43 S.Ct. 658, 663, 67 L.Ed.2d 1117 (1923), reaff'd, 263 U.S. 350, 44 S.Ct. 123, 67 L.Ed. 1144 (1923)).

As appellees argued before the district court, the fact that the proposed rules "may never be enacted, or alternatively, may be enacted in a form which completely alleviates plaintiffs' concerns," seems to suggest that any challenge to the proposals is premature. "The difference between an abstract question and a 'case or controversy' is one of degree, [however], and is not discernible by any precise test." Babbitt v. United Farm Workers Nat'l Union, 442 U.S. 289, 297, 99 S.Ct. 2301, 2308, 60 L.Ed.2d 895 (1979). In some instances, "the prospect or fear of future events may have a real impact on present affairs," Wright, Miller & Cooper Sec. 3532.2, at 143, such that a preemptive challenge is ripe. See, e.g., Bowsher v. Synar, 478 U.S. 714, 727 n. 5, 106 S.Ct. 3181, 3189 n. 5, 92 L.Ed.2d 583 (1986); Pacific Gas & Elec. Co. v. State Energy Resources Conservation & Dev. Comm'n, 461 U.S. 190, 201, 103 S.Ct. 1713, 1720, 75 L.Ed.2d 752 (1983); Pierce v. Society of Sisters, 268 U.S. 510, 534, 536, 45 S.Ct. 571, 574, 69 L.Ed. 1070 (1925); Pennsylvania v. West Virginia, 262 U.S. at 593, 43 S.Ct. at 664. In the antitrust context in particular, a rule that has yet to be enacted or enforced may be ripe for review if its mere proposal is likely to inhibit competition. See, e.g., North Am. Soccer League v. National Football League, 465 F.Supp. 665 (S.D.N.Y.1979) ("NASL v. NFL ") (district court entertained an antitrust challenge to a proposed amendment to the constitution and bylaws of the National Football League that would have prevented NFL owners from acquiring any interest in another major team sport), complaint dismissed, 505 F.Supp. 659 (S.D.N.Y.1980), aff'd in part, rev'd in part, and remanded, 670 F.2d 1249 (2d Cir.), cert. denied, 459 U.S. 1074, 103 S.Ct. 499, 74 L.Ed.2d 639 (1982).

Applying the foregoing principles to the facts as alleged in the amended complaint, we conclude that appellants' challenge to the Special Events Rule is ripe for consideration. Appellants claim that this rule is having a present anti-competitive effect because "persons or entities involved with Special Events and ... persons involved with MIPTC-sanctioned events are inhibited and deterred from entering into contracts with ProServ and IMC that extend into the future ... because they fear that ProServ and IMC will be compelled by the new rule to break either their agreements involving Special Events or their agreements involving MIPTC-sanctioned events." Likewise, appellants allege that "owners and producers of MIPTC-sanctioned events, including Volvo, are afraid to enter into long-term agreements with ProServ or IMC for fear that the defendants will force them to choose between breaching their contract with the player-agent and losing their MIPTC sanction." In our view, these allegations plausibly suggest how the proposed rule may have "a real impact on present affairs"; and under these circumstances, to withhold consideration until the rule is actually adopted might work considerable hardship on appellants. We note also that the proposal, as alleged, appears to be straightforward: it threatens to prohibit persons associated with sanctioned events from producing any Special Events. Thus, its effect is unlikely to be clarified substantially by whatever "further factual development" would accompany its enactment. For these reasons, we conclude that appellants' challenge to the Special Event Rule is ripe for consideration.

We believe, however, that any challenge to the three remaining proposals would be premature, even though appellants have suggested various ways in which these rules might have an impact on present affairs. The amended complaint states that the Best Interest Rule, which would give MIPTC the power to refuse to sanction any event that would not serve "the best interest of the sport," is having a present anticompetitive effect because owners and producers of sanctioned events "must exercise extreme care ... to comply with all demands of [MIPTC] because of fear that [MIPTC] will otherwise utilize the new rule to refuse to sanction or withdraw the sanction of" a given event. Likewise, appellants claim that the Conflicts of Interest Rule--which would allow MIPTC to prohibit certain players from participating in sanctioned events as wild cards--is having a present anticompetitive effect because "owners and producers of MIPTC-sanctioned events are being deterred from entering into any contractual relationships with player-agents ... for fear that ... the ongoing business relationship with the player-agent will cost that event its sanction or its cont[r]ol over its Wild Cards." Finally, appellants claim that the rule relating to pooled television broadcasting rights is having a present anticompetitive effect because "it deters television companies from entering into long-term television contracts ... because of concerns about (1) the competition with an MIPTC contract with a television company for a substantial package of television broadcast rights to MIPTC-sanctioned events, and (2) the legal effects of [the] rule." These alleged present effects are all more attenuated, however, than the alleged present effect of the Special Events Rule. It is also much more difficult to predict how appellees will choose to employ the three remaining rules should they be enacted; thus, unlike the effect of the Special Events Rule, the effect of the other proposed rules may be clarified by the further factual development that would accompany their adoption.

We therefore hold that appellants' challenges to the proposed Best Interest Rule, the Conflicts of Interest Rule, and the rule relating to the pooling of television broadcasting rights are not ripe for review. In the event that these rules are adopted, appellants, of course, are free to reinstitute their challenges. See Wright, Miller & Cooper Sec. 3532.1, at 137 (dismissal for lack of ripeness is not a decision on the merits for purposes of preclusion by judgment). We therefore vacate so much of the district court's order as dismissed with prejudice appellants' claims relating to the Best Interest Rule, the Conflicts of Interest Rule, and the rule relating to pooled broadcasting rights, and we direct the court to dismiss the claims relating to these rules without prejudice.

Appellees raised four principal arguments in support of the motion to dismiss: that the challenge to the proposed MIPTC rules, as discussed above, was not ripe for review; that appellants' antitrust claims were insufficient for failure to allege antitrust injury; that the court lacked jurisdiction over the state law claims; and that appellants had failed to plead the fraud claims with sufficient particularity. Appellants argue on appeal that the district court addressed none of these issues, and that the court dismissed the complaint on grounds neither briefed nor argued by any of the parties, thus depriving appellants of the opportunity to brief or argue the relevant issues. See, e.g., Square D Co. v. Niagara Frontier Tariff Bureau, 760 F.2d 1347, 1365 (2d Cir.1985) (district court has no authority to dismiss complaint for failure to state a claim upon which relief can be granted without giving plaintiff an opportunity to be heard), aff'd, 476 U.S. 409, 106 S.Ct. 1922,