A complaint may be dismissed for failure to state a claim where
it appears beyond any doubt that no relief could be granted under
any set of facts which could be proved consistent with the
allegations. Hartford Fire Ins. Co. v. California,
509 U.S. 764, 811-12, 113 S.Ct. 2891, 125 L.Ed.2d 612 (1993); Hishon v.
King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59
(1984); Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2
L.Ed.2d 80 (1957); Piecknick, 36 F.3d at 1255; ALA, Inc. v.
CCAIR, Inc., 29 F.3d 855, 859 (3d Cir. 1994); Ransom v.
Marrazzo, 848 F.2d 398, 401 (3d Cir. 1988); Angelastro v.
Prudential-Bache Sec., Inc., 764 F.2d 939, 944 (3d Cir.), cert.
denied, 474 U.S. 935, 106 S.Ct. 267, 88 L.Ed.2d 274 (1985).
A complaint should not be dismissed unless it appears beyond
doubt that "the facts alleged in the complaint, even if true,
fail to support the claim." Ransom, 848 F.2d at 401. Legal
conclusions made in the guise of factual allegations, however,
are given no presumption of truthfulness. See Papasan v.
Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209
(1986); Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d
Cir. 1997) ("[A] court need not credit a complaint's `bald
assertions' or `legal conclusions' when deciding a motion to
dismiss"); Haase v. Webster, 807 F.2d 208, 215 (D.C.Cir.),
vacated on other grounds, 835 F.2d 902 (D.C.Cir. 1987);
Briscoe v. LaHue, 663 F.2d 713, 723 (7th Cir.), aff'd,
460 U.S. 325, 103 S.Ct. 1108, 75 L.Ed.2d 96 (1983); Western Mining
Council v. Watt, 643 F.2d 618, 626 (9th Cir.), cert. denied,
454 U.S. 1031, 102 S.Ct. 567, 70 L.Ed.2d 474 (1981); Bermingham
v. Sony Corp. of Am., 820 F. Supp. 834, 846 (D.N.J.), aff'd,
37 F.3d 1485 (3d Cir. 1994).
A district court reviewing the sufficiency of a complaint has a
limited role. "The issue is not whether a plaintiff will
ultimately prevail but whether the claimant is entitled to offer
evidence to support his [or her] claims." Scheuer v. Rhodes,
416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974);
Bermingham, 820 F. Supp. at 846.
Generally, when conducting such an inquiry, material beyond the
pleadings should not be considered. See In re Burlington Coat
Factory Sec. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997);
Pension Benefit Guar. Corp. v. White Consol. Indus.,
998 F.2d 1192, 1196 (3d Cir.), cert. denied, 510 U.S. 1042, 114 S.Ct.
687, 126 L.Ed.2d 655 (1994); Wallace v. Systems & Computer Tech.
Corp., No. 95-6303, 1997 WL 602808, at *5 (E.D.Pa.23 Sept.
1997); Gannon v. Continental Ins. Co., 920 F. Supp. 566, 574
If the claims are based upon undisputably authentic documents
expressly relied upon or integral to the pleadings or matters of
public record, however, such documents may be considered. See In
re Burlington Coat Factory Sec. Litig., 114 F.3d at 1426; In re
Westinghouse Sec. Litig., 90 F.3d 696, 707 (3d Cir. 1996); In
re Donald Trump Sec. Litig., 7 F.3d 357, 368 n. 9 (3d Cir.),
cert. denied, 510 U.S. 1178, 114 S.Ct. 1219, 127 L.Ed.2d 565
(1994); EP Medsystems, Inc. v. Echocath, Inc., 30 F. Supp.2d 726,
740 (D.N.J. 1998); Pension Benefit Guar. Corp., 998 F.2d
at 1196; Wallace, 1997 WL 602808, at *5; Interfaith Community
Organization v. Alliedsignal, Inc., 928 F. Supp. 1339, 1345
(D.N.J. 1996); Weiner v. Quaker Oats, 928 F. Supp. 1372 (D.N.J.
1996), rev'd on other grounds, 129 F.3d 310 (3d Cir. 1997);
Gannon, 920 F. Supp. at 574. Documents attached to a motion to
dismiss must be explicitly relied upon or integral to the
complaint or counterclaim of the nonmovant. See In re Burlington
Coat Factory Sec. Litig., 114 F.3d at 1426 (quoting Shaw v.
Digital Equip. Corp., 82 F.3d 1194, 1220 (1st Cir. 1996)).
The failure of a nonmovant to attach or cite documents in the
complaint or counterclaim does not preclude a review of the texts
of such extrinsic documents in conjunction with a motion to
dismiss. See In re Burlington Coat Factory Sec. Litig.,
114 F.3d at 1426; EP Medsystems, 30 F. Supp.2d at 740. The
reason for this rule is to prevent
[t]he situation in which a [claimant] is able to
maintain a claim . . . by extracting an isolated
statement from a document and placing it in the
complaint, even though if the statement were examined
in the full context of the document, it would be
clear that the statement was not [actionable].
Id.; see Dykes, 68 F.3d at 1567 n. 3 (if documents specifically
referred to in the pleadings could not be considered, "a
plaintiff with a legally deficient claim could survive a motion
to dismiss simply by failing to attach a dispositive document
upon which it relied"). Under these circumstances, where a motion
to dismiss references such documents outside of the complaint or
counterclaim, the motion to dismiss is not converted into a
motion for summary judgment. See id.; Pension Benefit Guar.
Corp., 998 F.2d at 1196-97.
In support of the instant Motion, Syncsort submitted and relied
upon, among other things, the Syncsort Advertisements, the
Licensing Agreement, the Non-Disclosure Agreement and the
Responses of Sequential to the First Set of Interrogatories,
dated 26 May 1998, (the "Sequential Interrogatories
Responses").*fn6 See Moving Brief at 7-8. Syncsort contended
the Syncsort Advertisements, the Licensing Agreement and the
Sequential Interrogatories Responses may all properly be
considered in ruling on the instant Motion. See id.
Consideration of the Syncsort Advertisements, the Licensing
Agreement and the Non-Disclosure Agreement does not require
conversion of the instant Motion into one for summary judgment
under Fed. R.Civ.P. 56. See In re Burlington Coat Factory Sec.
Litig., 114 F.3d at 1426. These documents were expressly
referenced and relied upon in the Answer and Counterclaim. See
Answer and Counterclaims at ¶¶ 8, 9, 77, 85-94. The Licensing
Agreement, the Non-Disclosure Agreement and the Syncsort
Advertisements, moreover, are integral both to the False
Advertising Counterclaim and the Antitrust Counterclaim.
The Sequential Interrogatories Responses, by contrast, were
neither relied upon by Sequential, nor are they integral to the
pleadings of Sequential. Rather, the Sequential Interrogatories
Responses were relied upon by Syncsort "to the extent they help
explain the theories underlying each counterclaim." See Moving
Brief at 7. As such, the Sequential Interrogatories Responses
will not be considered in connection with the instant Motion.
See In re Burlington Coat Factory Sec. Litig., 114 F.3d at
B. The Antitrust Counterclaim
In the Antitrust Counterclaim, Sequential alleged Syncsort
violated section two ("Section Two") of the Sherman Antitrust Act
(the "Sherman Act"), 15 U.S.C. § 2. Specifically, Sequential
alleged, inter alia,
Syncsort is able to control the UNIX sorting
market*fn7 and maintain control of that market
through a variety of means including the use of
improperly restrictive licensing and confidentiality
agreements, misuse of its copyright, bringing
anti-competitive litigation, and knowingly asserting
claims for invalid or unfounded trade secrets.
Antitrust Counterclaim at ¶ 77. Sequential further alleged: