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`22-655
`Yookel, Inc. v. U.S. Steel Corp.
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`UNITED STATES COURT OF APPEALS
`FOR THE SECOND CIRCUIT
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`SUMMARY ORDER
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`RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO
`A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS
`GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S
`LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH
`THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
`ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY
`CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT
`REPRESENTED BY COUNSEL.
`
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`At a stated term of the United States Court of Appeals for the Second Circuit,
`held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the
`City of New York, on the 21st day of April, two thousand twenty-three.
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`PRESENT:
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`No. 22-655
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`BARRINGTON D. PARKER,
`DENNY CHIN,
`RICHARD J. SULLIVAN,
`Circuit Judges.
`_____________________________________
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`YOOKEL, INC.,
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`Plaintiff-Appellant,
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`v.
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`UNITED STATES STEEL CORPORATION,
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`Defendant-Appellee.∗
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`_____________________________________
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`∗ The Clerk of Court is respectfully directed to amend the official case caption as set forth above.
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`MANDATE
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`MANDATE ISSUED ON 05/12/2023
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page2 of 10
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`For Plaintiff-Appellant:
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`S.
`(Avery
`NICHOLAS VELIKY
`Mehlman, Shivani Poddar, on the
`brief), Herrick, Feinstein LLP, New
`York, NY.
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`For Defendant-Appellee:
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`CHRISTOPHER J. POTTMEYER, Jones
`Day, Pittsburgh, PA (Roy A. Powell,
`Jones Day, Dallas, TX, on the brief).
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`Appeal from a judgment of the United States District Court for the Eastern
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`District of New York (Kiyo A. Matsumoto, Judge).
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`UPON DUE CONSIDERATION,
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`IT
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`IS HEREBY ORDERED,
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`ADJUDGED, AND DECREED that the judgment of the district court is
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`AFFIRMED.
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`Yookel, Inc. (“Yookel”) appeals from the district court’s grant of a motion
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`for judgment on the pleadings after finding that Yookel did not plausibly allege
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`claims for breach of contract, declaratory judgment, unjust enrichment, and
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`fraudulent inducement against United States Steel Corporation (“U.S. Steel”).
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`Yookel alleges that U.S. Steel fraudulently induced Yookel to enter into two
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`agreements (the “Real Estate Agreement” and “Rail Easement”), which give
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`Yookel access to a railroad system that services industrial warehouses at the
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`Keystone Industrial Port Complex (“KIPC”), by failing to disclose that Yookel and
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`its lessee could be subject to demurrage fees charged by railyard operator
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page3 of 10
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`Consolidated Rail Corporation (“Conrail”) and its parent company, CSX
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`Transportation, Inc. (“CSX”). On appeal, Yookel principally argues that its
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`allegations were sufficiently plausible to survive U.S. Steel’s motion and that the
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`court’s issuance of a judgment on the pleadings with prejudice improperly deprived
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`Yookel of its right to amend its complaint. We assume the parties’ familiarity with
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`the underlying facts, procedural history, and issues on appeal.
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`“We review de novo a district court’s decision to grant a motion for
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`judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c).”
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`Lively v. WAFRA Inv. Advisory Grp., Inc., 6 F.4th 293, 301 (2d Cir. 2021) (internal
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`quotation marks omitted). On a Rule 12(c) motion, “we draw all reasonable
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`inferences in the plaintiff’s favor” to determine whether the plaintiff’s complaint
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`“contain[s] sufficient factual matter, accepted as true, to state a claim to relief that
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`is plausible on its face.” Id. (internal quotation marks omitted).
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`We agree with the district court that Yookel’s claims cannot withstand U.S.
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`Steel’s Rule 12(c) challenge.1 Starting with the breach-of-contract claim, we note
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`that Pennsylvania law is clear that when a contract is unambiguous – meaning “it
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`1 For the reasons discussed in the district court’s thorough and well-reasoned opinion, we are
`governed by New York’s choice-of-law rules, and therefore apply Pennsylvania substantive law
`to Yookel’s breach-of-contract and declaratory-judgment claims and New York substantive law
`to Yookel’s fraudulent-inducement and unjust-enrichment claims. Sp. App’x at 7–11.
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page4 of 10
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`is [not] reasonably susceptible of different constructions and capable of being
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`understood in more than one sense,” Hutchison v. Sunbeam Coal Corp., 519 A.2d
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`385, 390 (Pa. 1986) – “the intent of the parties is to be ascertained from the
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`document itself,” Kripp v. Kripp, 849 A.2d 1159, 1163 (Pa. 2004).
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`Here, the Real Estate Agreement and Rail Easement are unambiguous and
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`lend themselves to only one reasonable interpretation. Under the express terms
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`of the agreements, U.S. Steel granted Yookel “irrevocable, non-exclusive rights for
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`rail access[] and railroad staging,” App’x at 481 (Real Estate Agreement § 1.01),
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`“subject to [the] rights of other owners, tenants[,] and occupants at the KIPC, and
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`to [U.S. Steel’s] rights and [those of U.S. Steel’s] agents, assignees, carriers,
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`contractors[,] and all other persons lawfully using the Ancillary Rights,” id. at 482
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`(Real Estate Agreement § 1.01(A)). As part of this arrangement, Yookel agreed to
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`pay an annual maintenance fee. Id. at 482 (Real Estate Agreement § 1.01(B)). In
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`return, U.S. Steel agreed to “maintain the Common Area Rail Lines that service the
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`Premises,” id., and to keep the rails in “good working condition,” id. at 239 (Rail
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`Easement § 1(D)(c)). In other words, the quid pro quo was straightforward:
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`Yookel agreed to pay an annual maintenance fee and U.S. Steel promised to
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`maintain the Common Area Rails.
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page5 of 10
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`Yookel alleges that U.S. Steel breached the maintenance-fee provision of the
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`Real Estate Agreement because CSX assessed demurrage fees against Yookel’s
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`lessee. According to Yookel, it is entitled to reimbursement of the demurrage fees
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`because “Yookel . . . understood that it was only required to pay [U.S.] Steel the
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`Maintenance Fee in connection with its use of the Common Area Rails[] and was
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`not responsible for any other fees.” Id. at 55 ¶ 45. We disagree.
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`It is undisputed that section 1.01 of the Real Estate Agreement covers fees
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`for maintenance services only, and makes no reference to the myriad fees that
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`Yookel and its lessee might otherwise incur. Yookel would have us transform the
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`maintenance-fee provision into an insurance policy for any and all fees that Yookel
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`and its lessee might be charged, or a representation or warranty from U.S. Steel
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`that no other fees would apply to Yookel’s use of the Common Area Rails. But
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`Yookel never bargained for these contractual protections. Pennsylvania courts
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`have repeatedly and consistently held that when – as here – “a contract fails to
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`provide for a specific contingency, it is silent, not ambiguous[,] [and] [i]n such
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`circumstances, we will not read into the contract a term, . . . which clearly it does
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`not contain.” Seven Springs Farm, Inc. v. Croker, 748 A.2d 740, 744 (Pa. Super. Ct.
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`2000) (citation omitted), aff’d, 801 A.2d 1212 (Pa. 2002); see also Steuart v. McChesney,
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page6 of 10
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`444 A.2d 659, 662 (Pa. 1982). Accordingly, we agree with the district court that
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`“the plain language of the Real Estate Agreement does not entitle Yookel to recoup
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`demurrage fees from U.S. Steel” and that “[j]udgment on the pleadings [was] thus
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`appropriately granted to U.S. Steel on Yookel’s breach[-]of[-]contract claim.” Sp.
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`App’x at 19.
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`For largely the same reasons, Yookel also fails to allege a plausible
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`declaratory-judgment claim. Yookel first seeks a declaration – based on the silence
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`of the Real Estate Agreement and Rail Easement as to nonmaintenance fees – that
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`U.S. Steel is obliged to reimburse Yookel for demurrage fees. But once again,
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`under Pennsylvania law, we cannot transform silence into an affirmative
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`obligation on U.S. Steel’s part to pay these nonmaintenance fees. See Seven Springs
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`Farm, 748 A.2d at 744; Steuart, 444 A.2d at 662. Yookel also seeks a declaration
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`announcing that it need not pay the maintenance fee in light of U.S. Steel’s breach
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`of the Real Estate Agreement. But because we find that U.S. Steel has fully
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`performed under the Real Estate Agreement, we discern no material breach of the
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`contract that would justify a declaration absolving Yookel of its obligation to pay
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`the agreed-upon maintenance fee. See McCausland v. Wagner, 78 A.3d 1093, 1101
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`(Pa. Super. Ct. 2013) (explaining that “the non-breaching party is relieved from
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page7 of 10
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`any obligation to perform” only “[i]f a breach constitutes a material failure of
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`performance”).
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`Yookel’s unjust-enrichment claim is likewise untenable. Under New York
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`law, an unjust-enrichment claim lies where a “defendant has obtained a benefit
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`[that] in equity and good conscience should be paid to the plaintiff.” Corsello v.
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`Verizon N.Y., Inc., 18 N.Y.3d 777, 790 (2012) (internal quotation marks omitted).
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`“[B]ut unjust enrichment is not a catchall cause of action to be used when others
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`fail,” nor is it “available where it simply duplicates, or replaces, a conventional
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`contract . . . claim.” Id. (citations omitted). Here, Yookel’s unjust-enrichment
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`claim merely asserts that “[U.S.] Steel was enriched at Yookel’s expense by
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`avoiding payment of the Demurrage Fees.” App’x at 66 ¶ 117. It is therefore
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`entirely duplicative of Yookel’s contract claim.
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`Yookel has also failed to plausibly allege a viable claim for fraudulent
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`inducement. Yookel’s main argument here is that U.S. Steel fraudulently
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`“induce[d] Yookel to enter into the Real Estate Agreement,” Yookel Br. at 26,
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`through its “intentional omission of information concerning its relationship with
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`Conrail,” id. at 27. In particular, Yookel claims that it “had no way of learning
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`about the full extent of [U.S.] Steel’s relationship with Conrail outside of disclosure
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page8 of 10
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`from either [U.S.] Steel or Conrail,” id. at 26–27, and that “Yookel had no reason to
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`believe that demurrage fees would apply to the privately held [rail yard at KIPC],”
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`id. at 27. But an omission is actionable only if there is a duty to disclose, either
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`because a fiduciary relationship exists or because “one party possesses superior
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`knowledge, not readily available to the other.” Loreley Fin. (Jersey) No. 3 Ltd. v.
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`Wells Fargo Sec., LLC, 13 F.4th 247, 263 (2d Cir. 2021) (internal quotation marks
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`omitted); accord Jana L. v. W. 129th St. Realty Corp., 802 N.Y.S.2d 132, 134–35
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`(1st Dep’t 2005). Neither of those situations is implicated here.
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`First, Yookel pleads no facts alleging that U.S. Steel and Yookel had a
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`fiduciary relationship, which is not “normally present” in an “arm’s[-]length
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`business transaction[].” Oddo Asset Mgmt. v. Barclays Bank PLC, 19 N.Y.3d 584,
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`592–93 (2012) (internal quotation marks omitted). Second, while Yookel invokes
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`the essential-facts doctrine, the possibility that Conrail would charge demurrage
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`fees was not “peculiarly within the knowledge” of U.S. Steel and, in any event,
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`“could have been discovered . . . through the exercise of ordinary intelligence.”
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`Jana, 802 N.Y.S.2d at 135 (alteration and internal quotation marks omitted).
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`Indeed, demurrage fees are governed by federal laws and regulations to which
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`Yookel had ready access. See, e.g., 49 C.F.R. § 1333.3. Yookel also knew that it was
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page9 of 10
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`required to use U.S. Steel’s designated “switching carrier,” App’x at 481 (Real
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`Estate Agreement § 1.01), and that Conrail was responsible for “keep[ing] and
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`maintain[ing] the Rail System in unobstructed, good working condition” for U.S.
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`Steel pursuant to an operating agreement, id. at 239 (Rail Easement § 1(D)(c)).
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`Lastly, Yookel was aware that its rights to the Common Area Rails were subject to
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`the rights of others. See id. at 482 (Real Estate Agreement § 1.01). Accordingly,
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`because U.S. Steel had no duty to disclose the details of the arrangements between
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`U.S. Steel and Conrail, Yookel has not alleged a plausible fraudulent-inducement
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`claim.
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`Yookel finally argues that it was reversible error for the district court to
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`grant judgment on the pleadings with prejudice, thereby depriving Yookel of the
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`opportunity to amend its complaint. But Yookel never moved to amend its
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`complaint, and “no court can be said to have erred in failing to grant a request that
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`was not made.” Gallop v. Cheney, 642 F.3d 364, 369 (2d Cir. 2011). Further, our
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`precedent is clear that “[a] plaintiff need not be given leave to amend if it fails to
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`specify either to the district court or to the court of appeals how amendment would
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`cure the pleading deficiencies in its complaint.” TechnoMarine SA v. Giftports, Inc.,
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`758 F.3d 493, 505 (2d Cir. 2014). Here, both in the district court and on appeal,
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`Case 22-655, Document 83, 05/12/2023, 3514847, Page10 of 10
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`Yookel has offered “no new facts or arguments that could lead the court to find
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`that” Yookel plausibly alleges claims for breach of contract, declaratory judgment,
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`unjust enrichment, or fraudulent inducement. Sp. App’x at 28–29.
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`For these reasons, we AFFIRM the judgment of the district court.
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`FOR THE COURT:
`Catherine O=Hagan Wolfe, Clerk of Court
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