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June 13, 2011 Articles

Going Beyond the Complaint in Motions to Dismiss

Defendants must thoroughly know when they can refer to documents outside of the complaint in a motion to dismiss

By John J. Bajger

Iqbal dramatically changed motions to dismiss in federal court. Courts must now take a searching look at the complaint's allegations and determine whether the allegations are plausible. Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). Courts can even go as far as inferring lawful explanations for the defendant's alleged conduct from the allegations. Given these vigorous pleading standards, motions to dismiss have become a powerful weapon for defendants to attack complaints. To further this goal, and to maximize the effectiveness of motions to dismiss, defendants (and plaintiffs for that matter) must thoroughly know when they can refer to documents outside of the complaint.

At the outset, we must address the potential hazard of going beyond the four corners of the complaint. Federal Rule of Civil Procedure 12(d) provides that if "matters outside the pleadings" are presented on a motion to dismiss or a motion for judgment on the pleadings and the court does not choose to exclude them, the court must convert the motion into one for summary judgment, a potentially disastrous turn in the litigation. The question becomes when can a defendant refer to documents outside of the complaint in motions to dismiss without running the risk of having the court transform the motion into one for summary judgment?  

A good place to begin is with the common situation of documents attached to the complaint itself. Federal Rule of Civil procedure 10(c) makes any "written instrument" attached to a complaint part of the pleading. Clearly, "written instruments" include documents like contracts and loan documents, but it often encompasses a great deal more, ranging from magazine articles to letters. However, even when documents are attached, some courts will not consider documents that are incomplete or unreliable. See, eg, Divane v. Nextiraone, LLC, WL 31433504 (N.D. Ill., 2002). Nonetheless, chances are if the document is attached to the complaint, a defendant may utilize it in her motion to dismiss, which may prove very useful. All too often plaintiffs hastily attach documents to the complaint that contain valuable information for the defense—sometimes information that is inconsistent with the allegations of complaint.

Suppose a plaintiff refers to a document in its complaint but does not attach it. In this situation, the plaintiff may open the door to allowing the defendant to attach it to her motion to dismiss. As one court describes it, "when a complaint's factual allegations are expressly linked to—and admittedly dependent upon—a document (the authenticity of which is not challenged), that document effectively merges into the pleadings and the trial court can review it in deciding a motion to dismiss under Rule 12(b)(6)."” Beddall v. State St. Bank and Trust Co., 137 F.3d 12, 17 (1st Cir.1998). In other words, if the plaintiff chooses to selectively quote from a document, the defendant may complete the picture in her motion to dismiss by attaching the entire document to her motion and incorporating its contents in her argument.

Utilizing this principle of law makes the motion to dismiss as effective as a motion for summary judgment in some cases, and it accomplishes this without forcing the defendant to endure the burdens of discovery. For example, in Fudge v. Penthouse, the plaintiffs sued Penthouse, alleging that their publication of an article about the plaintiffs constituted libel and that it portrayed them in a false light. Fudge v. Penthouse International, LTD, 840 F.2d 1012 (11th Cir 1988). Penthouse included a copy of the article in their motion to dismiss. The court relied heavily on the article in granting Penthouse's motion. On appeal, the Eleventh Circuit affirmed the dismissal and held that the trial court properly considered the article because it was unquestionably central to the plaintiffs' claims. Accordingly, because the plaintiff eventually had to introduce the article, as they could not prove their claim without it, there was no good reason to prevent Penthouse from introducing the article in its motion to dismiss.

If a document is truly central to the claim, as in the Penthouse case, a defendant may be able to offer it on a motion to dismiss even if the plaintiff doesn’t refer to the document in the complaint. Assume, for example, a contract is not expressly mentioned in a complaint but the plaintiff heavily relies on its terms anyway. Under this circumstance, a defendant may attach the contract to the motion to dismiss. See, e.g. International Audiotext Network, Inc. v. American Tel. and Tel. Co. 62 F.3d 69 (2nd Cir 1995).  

Blay v. Zipcar provides another example of this situation. Blay v. Zipcar, 716 F. Supp. 2d 115 (D. Mass. 2010). The court afforded Zipcar, a rental car company, free reign to attach a significant number of documents to its motion to dismiss, which alleged unjust enrichment, among other things. Zipcar’s documents included a membership agreement, emails from a consumer, snapshots from the company's website, and a portion of the company's standard operating procedure. In its order granting the motion to dismiss, the court justified its consideration of the documents by concluding they were essential to the plaintiffs' claims. The court stated it would be unfair to permit the plaintiffs to characterize Zipcar's policies in the complaint while at the same time preventing Zipcar from pointing out misrepresentations in its motion to dismiss.

However, the broad range of documents the court allowed in Zipcar can be a bit misleading. Court decisions across the country get increasing fractious when the complaint does not reference the document. If there is some question as to the authenticity of the documents, then a court may not consider them. Likewise, courts are also hesitant to permit documents the plaintiff did not know about in order to prevent undue surprise. Before a defendant attaches a document when it is not explicitly referenced in the complaint (and this is true anytime a document is attached), she must carefully examine the circuit’s case law.

A court may also consider documents not referenced in a complaint if the court could otherwise take judicial notice of it under Federal Rule of Evidence 201. This includes official public records, like legislative history, SEC public disclosure documents, and court documents in unrelated cases, all of which are potentially very powerful on a motion to dismiss. For example, in Section 1983 cases, a public official may utilize public records and administrative records to justify their conduct in the context of a qualified immunity defense. Judicial notice could even extend beyond public records to include facts, like a dictionary definition (Clark v. Walt Disney Co., 642 F. Supp. 2d 775 (S.D. Ohio 2009)) or publicized stock prices (Greenhouse v. MCG Capital Corp., 392 F.3d 650 (4th Cir. 2004)).

In the post-Iqbal world of pleading, both plaintiffs and defendants must know what documents beyond the complaint can be addressed in a motion to dismiss. At the same time, when utilizing outside documents, defendants must also be cautious of going too far beyond the complaint to avoid the risk of having the court transform the motion to dismiss into one for summary judgment. To balance these two concerns, the defendant must be very familiar with the applicable circuit's case law and then must carefully justify the use of the documents in the motion itself.

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