PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
E. I. DU PONT DE NEMOURS AND
COMPANY,
Plaintiff-Appellee,
v.
KOLON INDUSTRIES, INCORPORATED,
Defendant-Appellant,
and
KOLON USA, INCORPORATED,
Defendant, No. 10-1103
v.
MICHAEL D. MITCHELL; ARAMID
FIBER SYSTEMS, LLC,
Third Party Defendants.
UNITED STATES OF AMERICA;
FEDERAL TRADE COMMISSION,
Amici Supporting Appellant.
2 DUPONT v. KOLON INDUSTRIES
E. I. DU PONT DE NEMOURS AND
COMPANY,
Plaintiff-Appellee,
v.
KOLON INDUSTRIES, INCORPORATED,
Defendant-Appellant,
and
KOLON USA, INCORPORATED,
Defendant, No. 10-1275
v.
MICHAEL D. MITCHELL; ARAMID
FIBER SYSTEMS, LLC,
Third Party Defendants.
UNITED STATES OF AMERICA;
FEDERAL TRADE COMMISSION,
Amici Supporting Appellant.
Appeals from the United States District Court
for the Eastern District of Virginia, at Richmond.
Robert E. Payne, Senior District Judge.
(3:09-cv-00058-REP)
Argued: October 26, 2010
Decided: March 11, 2011
Before KEENAN and WYNN, Circuit Judges, and
Bobby R. BALDOCK, Senior Circuit Judge of the
United States Court of Appeals for the Tenth Circuit,
sitting by designation.
DUPONT v. KOLON INDUSTRIES 3
Reversed by published opinion. Judge Wynn wrote the opin-
ion, in which Judge Keenan and Senior Judge Baldock joined.
COUNSEL
ARGUED: Stephen Blake Kinnaird, PAUL HASTINGS
JANOFSKY & WALKER, LLP, Washington, D.C., for
Appellant. Nickolai Gilford Levin, UNITED STATES
DEPARTMENT OF JUSTICE, Washington, D.C., for Amici
Supporting Appellant. Howard Feller, MCGUIREWOODS,
LLP, Richmond, Virginia, for Appellee. ON BRIEF: Michael
P. A. Cohen, PAUL HASTINGS JANOFSKY & WALKER,
LLP, Washington, D.C.; Dana J. Finberg, LECLAIRRYAN,
Richmond, Virginia, for Appellant. Willard K. Tom, General
Counsel, FEDERAL TRADE COMMISSION, Washington,
D.C.; Christine A. Varney, Assistant Attorney General, Cath-
erine G. O’Sullivan, UNITED STATES DEPARTMENT OF
JUSTICE, Washington, D.C., for Amici Supporting Appel-
lant. Kristen M. Calleja, MCGUIREWOODS, LLP, Rich-
mond, Virginia; Shari Ross Lahlou, CROWELL & MORING,
LLP, Washington, D.C., for Appellee.
OPINION
WYNN, Circuit Judge:
Under the Sherman Act, a plaintiff making monopoly and
attempted monopoly claims must allege a relevant geographic
market to help the court determine whether the defendant has
monopoly power. In this case, the district court held that
Supreme Court precedent required including in the relevant
geographic market definition all locations where product sup-
pliers are headquartered. Yet the Supreme Court case upon
which the district court relied, Tampa Electric Co. v. Nash-
ville Coal Co., 365 U.S. 320 (1961), requires no such thing.
4 DUPONT v. KOLON INDUSTRIES
Rather, it requires that courts consider, in defining the rele-
vant geographic market, where sellers operate and where pur-
chasers can predictably turn for supplies. If U.S. consumers
can predictably turn to supplies only in the United States, then
the United States is the relevant geographic market. Because
that is what Kolon Industries Incorporated alleged here, the
district court erred in dismissing its counterclaim for failure
to sufficiently plead a relevant geographic market.
I.
This is a case about whether E.I. du Pont de Nemours and
Company ("DuPont") attempted to wield, and did wield,
monopoly power over the U.S. para-aramid fiber market in
violation of Section 2 of the Sherman Act. Para-aramid fibers
are strong, complex synthetic fibers used to make, among
other things, body armor, tires, and fiber optic cables. Three
para-aramid producers—American DuPont, Dutch Teijin, and
Korean Kolon—sell their para-aramid fibers to U.S. consum-
ers. Other para-aramid producers exist but do not sell into the
U.S. market. DuPont is the unquestioned industry leader in
the U.S. para-aramid market. Indeed, for many years, DuPont
was the only para-aramid producer in the U.S. market, and it
currently sells over 70 percent of the para-aramid fibers pur-
chased in the United States.
In February 2009, DuPont brought a trade secrets suit
against Kolon, a relative newcomer to para-aramid produc-
tion. Kolon counterclaimed that DuPont had monopolized and
had attempted to monopolize the para-aramid market in viola-
tion of Section 2 of the Sherman Act, 15 U.S.C. § 2.1 The pri-
mary thrust of Kolon’s second amended counterclaim
("Counterclaim") is that DuPont illegally used multi-year sup-
ply agreements with high-volume para-aramid fiber custom-
1
Kolon counterclaimed under Section 16 of the Clayton Act, 15 U.S.C.
§ 26, "to prevent and restrain violations of Section 2 of the Sherman Act."
[J.A. 554]
DUPONT v. KOLON INDUSTRIES 5
ers. Those agreements required high-volume customers to
purchase 80 to 100 percent of their para-aramid requirements
from DuPont. Kolon alleged that those agreements removed
substantial commercial opportunities from competition and
limited other para-aramid fiber producers’ ability to compete.
DuPont moved, under Federal Civil Procedure Rule
12(b)(6), to dismiss Kolon’s Counterclaim. The district court
granted that motion on December 18, 2009, on the bases that:
(a) Kolon inadequately pled the relevant geographic market
within which competition for para-aramid fibers takes place;
and (b) Kolon failed to plead adequately unlawful exclusion-
ary conduct on the part of DuPont. E.I. Du Pont De Nemours
& Co. v. Kolon Indus., Inc., 683 F. Supp. 2d 401 (E.D. Va.
2009). The district court allowed Kolon to amend, but Kolon
declined in favor of an immediate appeal. The district court
therefore entered a final judgment against Kolon under Civil
Procedure Rule 54(b).
II.
We review de novo the district court’s grant of DuPont’s
motion to dismiss. Sucampo Pharm., Inc. v. Astellas Pharma,
Inc., 471 F.3d 544, 550 (4th Cir. 2006). When ruling on a
Rule 12(b)(6) motion to dismiss, "a judge must accept as true
all of the factual allegations contained in the complaint."
Erickson v. Pardus, 551 U.S. 89, 94 (2007). To survive the
motion, a complaint (or counterclaim, as is the case here)
must contain sufficient facts to state a claim that is "plausible
on its face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544,
570 (2007). Nevertheless, a complaint "need only give the
defendant fair notice of what the claim is and the grounds
upon which it rests." Coleman v. Md. Ct. of Apps., 626 F.3d
187, 190 (4th Cir. 2010) (internal quotation marks omitted).
Further, "like the district court, [we] draw all reasonable infer-
ences in favor of the plaintiff." Nemet Chevrolet, Ltd. v. Con-
sumeraffairs.com, Inc., 591 F.3d 250, 253 (4th Cir. 2009).
6 DUPONT v. KOLON INDUSTRIES
III.
Kolon contends that DuPont violated Section 2 of the Sher-
man Act through its use of exclusive contracts with high-
volume para-aramid customers. Under Section 2, "[e]very
person who shall monopolize, or attempt to monopolize, or
combine or conspire with any other person . . . to monopolize
any part of the trade" is guilty of an offense and subject to
penalties. 15 U.S.C. § 2. To prove a Section 2 monopolization
offense, a plaintiff must establish two elements: (1) the pos-
session of monopoly power; and (2) willful acquisition or
maintenance of that power—as opposed to simply superior
products or historic accidents. Eastman Kodak Co. v. Image
Technical Servs., Inc., 504 U.S. 451, 480 (1992); Cavalier
Tel., LLC v. Verizon Va., Inc., 330 F.3d 176, 183 (4th Cir.
2003). An attempted monopolization offense consists of: (1)
the use of anticompetitive conduct; (2) with specific intent to
monopolize; and (3) a dangerous probability of success. Spec-
trum Sports, Inc. v. McQuillan, 506 U.S. 447, 456 (1993);
Advanced Health-Care Servs., Inc. v. Radford Cmty. Hosp.,
910 F.2d 139, 147 (4th Cir. 1990).
To run afoul of Section 2, a defendant must be guilty of
illegal conduct "to foreclose competition, to gain a competi-
tive advantage, or to destroy a competitor." Eastman Kodak,
504 U.S. at 482-83 (internal quotation marks omitted). Con-
duct that might otherwise be lawful may be impermissibly
exclusionary under antitrust law when practiced by a monopo-
list. Indeed, "a monopolist is not free to take certain actions
that a company in a competitive . . . market may take, because
there is no market constraint on a monopolist’s behavior."
LePage’s, Inc. v. 3M, 324 F.3d 141, 151-52 (3d Cir. 2003)
(citing Aspen Skiing Co. v. Aspen Highlands Skiing Corp.,
472 U.S. 585, 601-04 (1985)). And although not per se illegal,
exclusive dealing arrangements can constitute an improper
means of acquiring or maintaining a monopoly. See, e.g.,
United States v. Grinnell Corp., 384 U.S. 563, 576 (1966);
Tampa Electric, 365 U.S. at 324, 327; United States v. Micro-
DUPONT v. KOLON INDUSTRIES 7
soft Corp., 253 F.3d 34, 70-71 (D.C. Cir. 2001); Advanced
Health-Care Servs., 910 F.2d at 142, 148-49.
In analyzing Sherman Act Section 2 claims such as the
ones Kolon makes here, courts begin with a preliminary
inquiry into market definition, which serves as a tool to deter-
mine the defendant’s market power. See Consul, Ltd. v.
Transco Energy Co., 805 F.2d 490, 493-95 (4th Cir. 1986).
The market definition has two components—the relevant
product market and the relevant geographic market. Id. at
493; RCM Supply Co., Inc. v. Hunter Douglas, Inc., 686 F.2d
1074, 1076 (4th Cir. 1982). Generally, in a Section 2 case, a
plaintiff must allege both as a threshold matter. Id.; Consul,
805 F.2d at 493-95. Here, the parties do not dispute the rele-
vant product market, which is the para-aramid fiber market.
The disagreement here centers on the relevant geographic
market.
The relevant geographic market inquiry focuses on that
geographic area within which the defendant’s customers who
are affected by the challenged practice can practicably turn to
alternative supplies if the defendant were to raise its prices or
restrict its output. William C. Holmes, Antitrust Law Hand-
book § 3:4 (West 2009); see also Herbert Hovenkamp, Fed-
eral Antitrust Policy § 3.6 (West 2005) ("The relevant
geographic area for antitrust purposes is some geographic area
in which a firm can increase its price without 1) large num-
bers of its customers quickly turning to alternative supply
sources outside the area; or 2) producers outside the area
quickly flooding the area with substitute products."). Courts
consider, in this context, the availability—or lack thereof—of
alternative supplies to which a consumer might practicably
turn because alternative supplies constrain an alleged monop-
olist’s ability to raise prices or exclude competition. See Ball
Mem’l Hosp., Inc. v. Mut. Hosp. Ins., Inc., 784 F.2d 1325,
1336-37 (7th Cir. 1986).
8 DUPONT v. KOLON INDUSTRIES
The standard for determining the relevant geographic mar-
ket announced in Tampa Electric2 has been paraphrased as
follows:
[T]he geographic market should consist of an area in
which the Defendants operate and which the Plaintiff
can reasonably turn to for supplies. If you determine
that, as a practical matter, [Plaintiff] can only turn
for supplies or purchase their relevant [supplies] in
[a narrowly defined] market, then that market is the
geographic market for Section 2 purposes. On the
other hand, if you determine that [Plaintiff] could
turn for supplies in an area broader than the [nar-
rowly defined] market, then the larger market would
be the geographic market for Section 2 purposes.
RCM Supply, 686 F.2d at 1077 (quoting, with approval, dis-
trict court’s jury instructions and expressly recognizing them
as "aptly" paraphrasing Tampa Electric’s standard for deter-
mining relevant geographic market); see also Consul, 805
F.2d at 495 ("The formulation approved by this court in RCM
Supply is helpful: the geographic market should consist of an
area in which the defendants operate and which the plaintiff
can reasonably turn to for supplies.") (internal quotation
marks omitted).
As the RCM Supply jury instructions suggest, "‘market def-
inition is a question of fact. . . .’" Coastal Fuels of Puerto
Rico, Inc. v. Caribbean Petroleum Corp., 79 F.3d 182, 196
2
The complaint in Tampa Electric raised claims under the Sherman Act,
15 U.S.C. § 1 and the Clayton Act, 15 U.S.C. § 12. The Supreme Court’s
analysis addressed only the Clayton Act claims and then stated that,
because the conduct at issue did not run afoul of the Clayton Act, it also
was not forbidden by the Sherman Act. Tampa Electric, 365 U.S. at 335.
Tampa Electric’s relevant geographic market framework is applied rou-
tinely in Sherman Act cases. See, e.g., Consul, 805 F.2d at 495; RCM Sup-
ply, 686 F.2d at 1076-77; Am. Football League v. Nat’l Football League,
323 F.2d 124, 129 (4th Cir. 1963).
DUPONT v. KOLON INDUSTRIES 9
(1st Cir. 1996) (quoting Weiss v. York Hosp., 745 F.2d 786,
825 (3d Cir. 1984)); see also, e.g., Oahu Gas Serv., Inc. v.
Pac. Res., Inc., 838 F.2d 360, 363 (9th Cir. 1988) ("Our previ-
ous decisions establish that both market definition and market
power are essentially questions of fact."); Westman Comm’n
Co. v. Hobart Int’l, Inc., 796 F.2d 1216, 1220 (10th Cir.
1986) ("We recognize that market definition is a question of
fact . . . ."); Heatransfer Corp. v. Volkswagenwerk, A.G., 553
F.2d 964, 979 (5th Cir. 1977) ("Relevant market is essentially
a question of fact . . . ."). This makes sense, given that deter-
mining the relevant geographic market is a fact-intensive
exercise centered on the commercial realities of the market
and competition. See, e.g., Eastman Kodak, 504 U.S. at 453
("The proper market definition in this case can be determined
only after a factual inquiry into the ‘commercial realities’
faced by consumers."); Todd v. Exxon Corp., 275 F.3d 191,
199 (2d Cir. 2001) (Sotomayor, J.) (noting that "market defi-
nition is a deeply fact-intensive inquiry").
The commercial realities considered when defining the rel-
evant geographic market include: where the parties market
their products; the size, cumbersomeness, and perishability of
the products; regulatory requirements impeding the free flow
of competing goods into or out of the area; shipping costs and
limitations; the area within which the defendant and its com-
petitors view themselves as competing; and other factors bear-
ing upon where customers might realistically look to buy the
product. See, e.g., Antitrust Law Handbook § 3.4; RCM Sup-
ply, 686 F.2d at 1077; Wampler v. Sw. Bell Tel. Co., 597 F.3d
741, 744-45 (5th Cir. 2010); L.A. Draper & Son v.
Wheelabrator-Frye, Inc., 735 F.2d 414, 423 (11th Cir. 1984).
The Supreme Court has noted that "although the geo-
graphic market in some instances may encompass the entire
Nation, under other circumstances it may be as small as a sin-
gle metropolitan area." Brown Shoe Co. v. United States, 370
U.S. 294, 337 (1962). Therefore, in Brown Shoe, a Clayton
Act case, the geographic market was properly limited to cities
10 DUPONT v. KOLON INDUSTRIES
of a certain size where two shoe companies sold goods. Id.
Similarly, this Circuit has stated that "the relevant market has
been found to be a single city, a group of cities, a state, or
several states." Am. Football League, 323 F.2d at 129 (foot-
notes omitted).
Consequently, dismissal of an antitrust claim for failure to
adequately plead the relevant market can be problematic. As
then-Judge, now-Justice Sotomayor noted in Todd:3
Because market definition is a deeply fact-intensive
inquiry, courts hesitate to grant motions to dismiss
for failure to plead a relevant product market. See
Found. for Interior Design Educ. Research v. Savan-
nah Coll. of Art & Design, 244 F.3d 521, 531 (6th
Cir. 2001) ("Market definition is a highly fact-based
analysis that generally requires discovery.") (citing
Eastman Kodak Co. v. Image Technical Servs., Inc.,
504 U.S. 451, 482, 112 S. Ct. 2072, 119 L.Ed.2d 265
(1992)); Double D Spotting Serv., Inc. v. Supervalu,
Inc., 136 F.3d 554, 560 (8th Cir. 1998) (noting that
"courts are hesitant to dismiss antitrust actions
before the parties have had an opportunity for dis-
covery"); Queen City Pizza, Inc. v. Domino’s Pizza,
Inc., 124 F.3d 430, 436 (3d Cir. 1997) (explaining
that "in most cases, proper market definition can be
determined only after a factual inquiry into the com-
mercial realities faced by consumers") (citing East-
man Kodak, 504 U.S. at 482, 112 S. Ct. 2072); cf.
Hayden Publ’g Co. v. Cox Broad. Corp., 730 F.2d
64, 70 n.8 (2d Cir. 1984) ("The conclusion that gen-
uine issues of material fact preclude a finding as to
[the] relevant market as a matter of law is not unex-
3
While Todd focused on relevant product market definition, the
Supreme Court has recognized that "[t]he criteria to be used in determin-
ing the appropriate geographic market are essentially similar to those used
to determine the relevant product market." Brown Shoe, 370 U.S. at 336.
DUPONT v. KOLON INDUSTRIES 11
pected. It frequently has been observed that ‘a pro-
nouncement as to market definition is not one of law,
but of fact . . . .’ ") (citations and alterations omit-
ted). There is, however, no absolute rule against the
dismissal of antitrust claims for failure to allege a
relevant product market. Queen City, 124 F.3d at
436.
***
Cases in which dismissal on the pleadings is appro-
priate frequently involve either (1) failed attempts to
limit a product market to a single brand, franchise,
institution, or comparable entity that competes with
potential substitutes or (2) failure even to attempt a
plausible explanation as to why a market should be
limited in a particular way.
Todd, 275 F.3d at 199-200 (footnotes omitted) (reversing dis-
trict court’s dismissal of the complaint, which pled a relevant
market).
Stated differently, "dismissals at the pre-discovery, plead-
ing stage remain relatively rare and are generally limited to"
certain types of "glaring deficiencies," such as failing to
allege a relevant market. Allen v. Dairy Farmers of Am., Inc.,
No. 5:09-cv-230, ___ F. Supp. 2d ___, ___ (D. Vt. 2010)
(stating that dismissals are "generally limited to instances in
which the complaint either: (1) fails to allege a geographic
market or the boundaries of a relevant geographic market; (2)
defines a geographic market in an unreasonably and implausi-
bly narrow manner; or (3) alleges a contradictory and vague
delineation of the relevant geographic market. Here, none of
those glaring deficiencies are present in the Amended Com-
plaint. As a result, the proper market definition in this case
can be determined only after a factual inquiry into the com-
mercial realities faced by consumers." (internal quotation
marks and citations omitted)).
12 DUPONT v. KOLON INDUSTRIES
In this case, Kolon pled that the relevant geographic market
was "worldwide supply of para-aramid fiber to commercial
purchasers in the United States."4 [J.A. 561] Kolon also pled
that: the U.S. para-aramid market is distinct from other mar-
kets; prices are high while supply is low; some foreign manu-
facturers do not sell their para-aramid fibers to U.S.
consumers; high technical and legal barriers to the U.S. para-
aramid market exist; and DuPont dominates the market
through the use of essentially exclusive multi-year contracts.
In other words, Kolon pled that the United States functions
as a distinct market for para-aramid fibers. Further, Kolon
pled market realities that could have led to the United States’
being a distinct market—that is, technical, legal, and other
barriers to entry, as well as DuPont’s anticompetitive con-
4
Paragraph 24 of the Counterclaim states:
The relevant geographic market is worldwide supply of para-
aramid fiber to commercial purchasers in the United States. The
geographic market includes foreign supply practicably available
to U.S. commercial purchasers, but the extent and nature of that
supply is not known and will have the be determined on a factual
record. Competition for U.S. commercial para-aramid buyers
occurs in the United States where the buyers are located. Many
U.S. buyers require particular qualification analysis and tests for
their specific commercial uses. And prices in the United States
are distinct from other nations. There are only five global produc-
ers of para-aramid fiber. DuPont is the only domestic producer.
Teijin is the only other supplier to U.S. commercial customers,
but the amount of its supply and shipments to the United States
for commercial use are not known. Its capacity to divert produc-
tion for supply to United States commercial customers also is not
known. Accordingly, the extend of its production that should be
included in the market definition and market share calculations
must be left for factual determination. Kolon is the only other
manufacturer that supplies commercial customers in the United
States, and its sales to date are de minimis. Kamenskvolokno and
Yenta Spandex do not supply commercial customers or otherwise
ship para-aramid fiber into the United States.
[J.A. 561]
DUPONT v. KOLON INDUSTRIES 13
tracts with key para-aramid consumers. Kolon therefore pled
a plausible, distinct relevant geographic market. Indeed, even
the district court recognized that Kolon pled that U.S. con-
sumers "have considerable difficulty in turning to the prod-
ucts of foreign manufacturers," that Kolon gives "specific
reasons" for these difficulties, and that this and "other com-
mercial realities" "mitigate[] [sic] toward the plausibility of
Kolon’s proposed market definition." [J.A. 730-32]
The district court nevertheless concluded that "[t]he mar-
ket, per Tampa Electric, . . . must be expanded to include the
areas where the sellers operate," apparently without regard to
whether U.S. consumers of para-aramid fibers can practicably
turn to supplies in those places. [J.A. 740] Consequently, the
district court held:
Kolon cannot acknowledge, on the one hand, that
Teijin and Kolon sell to American customers while,
on the other hand, excluding those countries from
the geographic market. Thus, the minimum plausible
geographic market for Kolon’s allegations must
include the Netherlands, where Teijin is head-
quartered, and Korea, where Kolon is headquartered.5
[J.A. 740-41] The district court so concluded with no infor-
mation before it, on DuPont’s Rule 12(b)(6) motion, about
what para-aramid fiber supplies exist in those headquarter
countries or the extent to which the presumed supplies in
those countries could be diverted to U.S. consumers. As a
matter of fact, the district court deemed such commercial real-
ities irrelevant: "Even if there is considerable evidence6 that
5
At other points in its opinion, the district court also refers to the neces-
sity of including in the relevant geographic market those places where
sellers "operate" and "produce." [J.A. 739-741]
6
The district court’s use of the word "evidence" in this context under-
scores the district court’s failure to adhere to the strict standards of what
may be considered—the Counterclaim—and who benefits from the infer-
ences drawn therefrom—the non-movant—on a Rule 12(b)(6) motion.
This problem is addressed in some detail below.
14 DUPONT v. KOLON INDUSTRIES
much of Kolon’s supply is not practically available to con-
sumers in the United States, the wisdom of Landes & Posner
. . . counsels the Court to include all of Kolon’s sales to all
markets within the relevant geographic market for this case."
[J.A. 739]
The district court reached this conclusion despite the fact
that no federal appellate court has held that supplier head-
quarter sites must, as a matter of law, be included in the rele-
vant geographic market definition in Sherman Act cases. The
district court instead relied on a 1981 law review arti-
cle—William M. Landes & Richard A. Posner, Market Power
in Antitrust Cases, 94 Harv. L. Rev. 937 (1981).7 Landes and
Posner posited that
if a distant seller has some sales in a local market, all
its sales, wherever made, should be considered a part
of that local market for purposes of computing the
market share of a local seller. This is because the
distant seller has proved its ability to sell in the mar-
ket and could increase its sales there, should the
local price rise, simply by diverting sales from other
markets.
Id. at 963.
As the district court itself recognized, however, the "model
proposed by Landes and Posner is less persuasive when
exclusive dealing arrangements are alleged. When a ‘distant
seller’ (id.) is prevented from effectively competing in the
American market by anticompetitive conduct, the anticompe-
titive actor’s exclusive deals prevent the distant seller from
injecting a rapid influx of competing product in response to
a price increase." [J.A. 739] That is precisely what Kolon
alleged in its Counterclaim.
7
While we otherwise would hesitate to give such extensive treatment to
a law review article, we do so here because the district court heavily relied
on this one in granting DuPont’s motion to dismiss.
DUPONT v. KOLON INDUSTRIES 15
Further, Landes’s and Posner’s model, by its own terms,
applies only to suppliers with "nonnegligible sales in the mar-
ket for a continuous period of several years. This is necessary
to deal with the case where distant sellers make sporadic or
insignificant sales in the market in question . . . ." Landes &
Posner, supra, at 967. Kolon pled that its sales constituted
only .87 percent of the U.S. para-aramid market and that
Kolon had been in the market since only 2006. Even Landes
and Posner would therefore almost surely not include Korea
in Kolon’s relevant geographic market. And Landes and Pos-
ner also made clear that "[s]ometimes a foreign product will
. . . reach just one of the coasts of the United States (the west
coast, for Japanese and other Asian producers; the east coast,
for European producers); domestic U.S. transportation costs
will prevent it from reaching the interior markets of the
United States or the other coast. These sellers should not be
included in measuring the market power of firms selling to the
interior markets or the other coast." Id. That caveat could rule
both Dutch Teijin and Korean Kolon out of the relevant geo-
graphic market.8
8
Moreover, the Landes and Posner article has been the target of consid-
erable criticism for its failure to take into account commercial realities in
international trade cases. See, e.g., Robert Pitofsky, New Definitions of
Relevant Market and the Assault on Antitrust, 90 Colum. L. Rev. 1805,
1857-59 (1990); Timothy J. Brennan, Mistaken Elasticities and Mislead-
ing Rules, 95 Harv. L. Rev. 1849, 1849 (1982); Louis Kaplow, The Accu-
racy of Traditional Market Analysis and a Direct Adjustment Alternative,
95 Harv. L. Rev. 1817, 1835-48 (1982). Its critics warned that Landes’s
and Posner’s "logic is applicable in only the rarest of cases," Kaplow,
supra, at 1836, and "may lead to faulty estimates of market power." Bren-
nan, supra, at 1849. For example, Landes and Posner indicated that their
logic "holds only if the foreign and domestic products are perfectly identi-
cal." Landes & Posner, supra, at 965. But "[m]ost products do vary some-
what across brands, at least as perceived by consumers. Ordinarily,
antitrust analysis treats substantially similar products as though they were
identical, because any error thereby introduced is insignificant. But with
Landes and Posner’s rule for geographical market definition, the resulting
error is overwhelming, because even modest imports dictate the inclusion
of all foreign production." Kaplow, supra, at 1836 (footnote omitted). Fur-
ther, Landes and Posner were criticized for failing to account for, among
other things, foreign suppliers’ difficulties in diverting potential alterna-
tive supplies, transportation and tariff costs, and other barriers to importa-
tion. See, e.g., Brennan, supra at 1849-50.
16 DUPONT v. KOLON INDUSTRIES
Regardless of Landes’s and Posner’s construct, in RCM
Supply, our paraphrasing of Tampa Electric’s standard makes
plain that this Circuit does not interpret Tampa Electric to
require suppliers’ headquarter locations to be included in rele-
vant market definition without regard to whether consumers
can actually turn to those places for supplies. RCM Supply,
686 F.2d at 1077. In fact, the RCM Supply jury was instructed
to find the relevant geographic market to be the Washington,
D.C. area if it found that RCM could practically turn only to
supplies in that area. Id. The jury was further instructed that,
to determine to what area "RCM can practically turn for sup-
plies, you should consider whether there are any differences
in transportation costs, distribution facilities, customer inven-
tory or any other factor that would cause the Plaintiff to turn
to the suppliers solely within" the Washington area. Id. That
is, one must look at the commercial realities to define the rele-
vant market.
Similarly, in United States v. Pabst Brewing Co., 384 U.S.
546, 548 (1966), a Clayton Act case, the Supreme Court
approved of a geographic market for beer sales that was lim-
ited to Wisconsin or a tri-state area of Wisconsin, Illinois, and
Michigan—even though a significant portion of the beer sold
in Wisconsin was brewed elsewhere. See United States v.
Pabst Brewing Co., 233 F. Supp. 475, 481 (E.D. Wisc. 1964),
rev’d, 384 U.S. 546 (noting that "beer was sold in Wisconsin
by 69 breweries" but only "38 breweries were operated in that
state").
Further, in United States v. Dentsply Int’l, Inc., 399 F.3d
181, 184, 187-88 (3d Cir. 2005), the Third Circuit accepted a
relevant market definition of "the sale of prefabricated artifi-
cial teeth in the United States." The government’s complaint
in Dentsply, similar to Kolon’s Counterclaim here, alleged
that Dentsply, which held a 75- to 80-percent market share,
stifled artificial tooth competition, including through the use
of exclusive agreements. Id. at 184. Some of the other manu-
facturers of prefabricated artificial teeth who sold into the
DUPONT v. KOLON INDUSTRIES 17
U.S. market—such as "Vita Zahnfabrik" and "Heraeus Kulzer
GmbH"—would seem to be foreign. Id. Nonetheless, the rele-
vant market was confined to all prefabricated artificial teeth
sales in the United States. Id.
RCM Supply, Brown Shoe, Pabst Brewing, Dentsply, and
other cases9 demonstrate that, in defining the relevant geo-
graphic market in an antitrust case, plaintiffs are not required
to include supplier headquarter or other sites without regard
to whether consumers can predictably turn to those places for
supply. And Tampa Electric neither held nor implied any such
requirement.
Here, Kolon pled a relevant geographic market—the United
States. Further, Kolon pled plausible reasons for limiting the
geographic market to the United States. Kolon therefore
cleared the hurdle of pleading a plausible relevant geographic
market. Whether Kolon’s proffered relevant geographic mar-
ket definition will hold up upon a fact-intensive inquiry
remains to be seen. But dismissing Kolon’s Counterclaim on
its face was error.
Nonetheless, DuPont attempts to preserve its 12(b)(6) vic-
tory by comparing the inadequate complaint in Twombly, 550
U.S. 544, to Kolon’s Counterclaim here. But this case is no
Twombly. In Twombly, the class-action plaintiffs brought an
antitrust conspiracy claim but then failed to allege a conspir-
acy, i.e., an illegal agreement, instead alleging merely parallel
business conduct. Twombly, 550 U.S. 544. Here, in contrast,
Kolon unquestionably alleged a relevant geographic market.
9
See, e.g., United States v. Columbia Steel Co., 334 U.S. 495 (1948)
(considering the supply of steel products that producers located outside the
relevant geographic area supplied to consumers within the area); In re
Polypore Int’l, Inc., Case No. 9327, 2010 WL 866178 (F.T.C. Mar. 1,
2010) (limiting relevant geographic market to North America despite
respondent’s having manufacturing sites in the United States as well as in
Austria, Thailand, China, India, France, and Italy).
18 DUPONT v. KOLON INDUSTRIES
As the record shows, Kolon alleged a distinct U.S. market and
then explained why it was so.
DuPont further contends that Kolon’s Counterclaim must
fail because of the Berry Amendment, which generally pro-
hibits the Department of Defense from buying supplies from
foreign producers such as Kolon. See 10 U.S.C. § 2533a.
However, the extent to which DuPont’s dominant market
position can be attributed to the Berry Amend-
ment—something the district court attempted to analyze by
inappropriately going beyond the Counterclaim—cannot be
determined at the motion-to-dismiss stage. Further, Kolon’s
Counterclaim restricts its market definition to commercial
purchasers. Under these circumstances, dismissal was inap-
propriate.
Finally, DuPont contends that, according to the U.S.
Department of Justice’s and Federal Trade Commission’s
Horizontal Merger Guidelines, considering foreign supply
into the U.S. market while limiting the relevant geographic
market to the United States is appropriate only where price
discrimination is alleged. DuPont argues that, because Kolon
did not use the phrase "price discrimination" in its Counter-
claim, Kolon made no such allegation.
DuPont cites no binding authority for either the proposition
that such a market definition is permissible only where price
discrimination is alleged or the proposition that the specific
words "price discrimination" must be used to allege price dis-
crimination. See United States v. Dean Foods Co., Case No.
10-CV-59, 2010 WL 1417926, at *5 (E.D. Wis. April 7,
2010) (holding that plaintiff was not required "to include
magic words in order to survive a motion to dismiss" when
claiming defendant’s ability to price-discriminate—i.e.,
impose a small but significant and nontransitory increase in
price on customers unable to turn to alternative supply).
Meanwhile, Kolon pled that DuPont dominated the U.S.
para-aramid market, that U.S. para-aramid consumers pay
DUPONT v. KOLON INDUSTRIES 19
more than consumers elsewhere, but that, despite high prices,
para-aramid fiber supply in the United States remains low.
These allegations suggest price discrimination that would sup-
port Kolon’s contention that DuPont possessed sufficient mar-
ket power such that it was a monopolist. See, e.g., In re Brand
Name Prescription Drugs Antitrust Litig., 186 F.3d 781, 783
(7th Cir. 1999) ("Price discrimination implies market power,
that is, the power to charge a price above cost (including in
‘cost’ a profit equal to the cost of equity capital) without los-
ing so much business so fast to competitors that the price is
unsustainable.").
In sum, Kolon pled a distinct relevant geographic market
and provided numerous reasons for defining the market as it
did. Kolon’s plausible relevant geographic market was suffi-
cient to withstand a Rule 12(b)(6) motion to dismiss, and the
district court erred in holding otherwise.
IV.
The district court also concluded that Kolon failed to ade-
quately plead anticompetitive conduct. Kolon contends that
this determination rested on information inappropriately con-
sidered on a motion to dismiss and on inferences in DuPont’s,
instead of Kolon’s, favor. We agree.
A. Facts And Inferences On DuPont’s Motion To Dismiss
When ruling on a Rule 12(b)(6) motion to dismiss, "a judge
must accept as true all of the factual allegations contained in
the complaint." Erickson, 551 U.S. at 94. See also Advanced
Health-Care Servs., 910 F.2d at 147 ("The factual allegations
of the plaintiff with respect to the relevant markets and the
defendants’ market shares must be accepted as true at this
point."). The complaint "need only give the defendant fair
notice of what the claim is and the grounds upon which it
rests." Coleman, 626 F.3d at 190 (internal quotation marks
20 DUPONT v. KOLON INDUSTRIES
omitted). And "all reasonable inferences" must be drawn in
favor of the complainant. Nemet Chevrolet, 591 F.3d at 253.
In deciding whether a complaint will survive a motion to
dismiss, a court evaluates the complaint in its entirety, as well
as documents attached or incorporated into the complaint.
Sec’y of State for Defence v. Trimble Navigation Ltd., 484
F.3d 700, 705 (4th Cir. 2007); Phillips v. LCI Int’l Inc., 190
F.3d 609, 618 (4th Cir. 1999) (stating that "a court may con-
sider [a document outside the complaint] in determining
whether to dismiss the complaint" where the document "was
integral to and explicitly relied on in the complaint" and there
was no authenticity challenge). However, the district court
cannot go beyond these documents on a Rule 12(b)(6)
motion; if it does, it converts the motion into one for summary
judgment. Fed. R. Civ. P. 12(b), 12(d), 56. Such conversion
is not appropriate where the parties have not had an opportu-
nity for reasonable discovery. Gay v. Wall, 761 F.2d 175, 178
(4th Cir. 1985) ("Because Gay was not afforded an opportu-
nity for reasonable discovery, the district court’s treatment of
the motion to dismiss as a motion for summary judgment was
an abuse of discretion.").
Additionally, statements by counsel that raise new facts
constitute matters beyond the pleadings and cannot be consid-
ered on a Rule 12(b)(6) motion. Dolgaleva v. Va. Beach City
Pub. Sch., 364 F. App’x 820, 825 (4th Cir. 2010) (citing
Hamm v. Rhone-Poulenc Rorer Pharms., Inc., 187 F.3d 941,
948 (8th Cir. 1999)); cf. Smith v. Local No. 25, Sheet Metal
Workers Int’l Ass’n, 500 F.2d 741, 744-45 (5th Cir. 1974)
(treating a Rule 12(b)(6) dismissal order as converted into
summary judgment because district court relied on materials
outside the pleadings, including oral argument). In Dolgaleva,
rather than considering only the face of the complaint, the dis-
trict court allowed the defendant to dispute allegations during
a hearing. The district court then improperly dismissed the
complaint based on statements the defendant made at the
hearing. Dolgaleva, 364 F. App’x at 825-26. (citing Lee v.
DUPONT v. KOLON INDUSTRIES 21
City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (find-
ing error where the district court "assumed the existence of
facts that favor defendants based on evidence outside plain-
tiffs’ pleadings, [and] took judicial notice of the truth of dis-
puted factual matters")).
Similarly, in this case, the district court went beyond
Kolon’s Counterclaim in ruling on DuPont’s motion to dis-
miss. The district court relied upon a statement made by
DuPont’s counsel during oral argument that "Kolon had
access to all of DuPont’s relevant supply agreements during
the time period in question." [J.A. 712] The district court reit-
erated several times that "DuPont asserts that these are the
only supply agreements relevant to Kolon’s claims" and that
"DuPont has affirmed, at oral argument in open court, that it
has disclosed all supply agreements pertinent to Kolon’s
claims." [J.A. 745-46] The district court then made plain that
it accepted the statement as true and would evaluate Kolon’s
complaint in light thereof: "These documents, in essence, are
Kolon’s case for anticompetitive conduct." [J.A. 747]
Similarly, the district court stated:
The Court will not view these supply agreements as
it would the entirety of both parties’ evidence at
summary judgment. But, DuPont has affirmed, at
oral argument in open court, that it has disclosed all
supply agreements pertinent to Kolon’s claims.
Thus, the legal sufficiency of Kolon’s allegations
depends upon whether its claims of market exclusion
are plausible given the substance of the supply
agreements.
[J.A. 745] The problem: Kolon never suggested in its Coun-
terclaim that it had received all of DuPont’s contracts relevant
to Kolon’s antitrust claims. And it would surely have been
difficult for Kolon to know whether it had all relevant DuPont
22 DUPONT v. KOLON INDUSTRIES
contracts given that nothing in the record indicates that full
discovery had been undertaken.10
Nevertheless, the district court’s anticompetitive conduct
analysis is riddled with reliance on DuPont’s statement about
the contracts. For example, the district court stated that
"DuPont has executed supply agreements, covering various
periods from 2006 through the end of 2010, with four of its
top twelve customers. . . . [T]his percentage does not allow
for a plausible claim of substantial foreclosure." [J.A. 738] In
analyzing DuPont’s market share for which Kolon was pre-
vented from competing, the district court assumed only four
anticompetitive contracts—i.e., that four of DuPont’s top
twelve customers were constrained from buying Kolon’s or
other DuPont competitors’ products. On that basis, the district
court calculated an overall market foreclosure percentage of
less than 25 percent and held that such a low percentage was
not enough to have a significant effect on competition in vio-
lation of the Sherman Act.
We hold that the district court erred in accepting statements
beyond the Counterclaim and making inferences on that basis
in favor of DuPont. And because the record indicates that the
parties had not yet had the opportunity to conduct reasonable
discovery, converting the motion to dismiss to one for sum-
mary judgment, where such statements, if appropriately pre-
sented, could be considered, would have been error. See Gay,
761 F.2d at 178 ("Because Gay was not afforded an opportu-
nity for reasonable discovery, the district court’s treatment of
the motion to dismiss as a motion for summary judgment was
an abuse of discretion.").
10
Indeed, Kolon objected that DuPont’s statements "ha[d]n’t been tested
by discovery. They are just standing up here, making representations about
the facts that we’ve had absolutely no ability to get." [J.A. 667] Kolon’s
counsel underscored that "[w]e have gotten a self-selected set of discovery
that was not given to us under any compulsory discovery. We still haven’t
gotten compulsory discovery. We don’t know whether or not their self-
representation . . . is correct." [J.A. 668]
DUPONT v. KOLON INDUSTRIES 23
It remains for us to determine whether the district court’s
error was harmless. Where a district court errs in going
beyond the complaint on a Rule 12(b)(6) motion, the error is
harmless if the complaint would not have withstood the
motion to dismiss on its face. Dolgaleva, 364 F. App’x at 826.
Stated differently, we can affirm the dismissal of the com-
plaint "on any basis fairly supported by the record." Eisenberg
v. Wachovia Bank, N.A., 301 F.3d 220, 222 (4th Cir. 2002).
We therefore look to Kolon’s Counterclaim to determine
whether Kolon sufficiently pled its two Sherman Act claims,
taking Kolon’s allegations as true and making all reasonable
inferences in its favor. See Erickson, 551 U.S. at 94; Nemet
Chevrolet, 591 F.3d at 253.11
B. Kolon’s Monopolization Claim
As stated earlier, a monopolization violation consists of
two elements: (1) the possession of monopoly power in the
relevant market, and (2) willful maintenance of that power.
Eastman Kodak, 504 U.S. at 480; Cavalier Tel., 330 F.3d at
183. To violate Section 2, a defendant must engage in conduct
"to foreclose competition, gain a competitive advantage, or to
destroy a competitor." Eastman Kodak, 504 U.S. at 482-83
(internal quotation marks omitted).
As to the first element, possession of monopoly power, this
Court has previously noted that "when monopolization has
been found the defendant controlled seventy to one hundred
per cent of the relevant market." White Bag Co. v. Int’l Paper
Co., 579 F.2d 1384, 1387 (4th Cir. 1974) (citations omitted).
See also, e.g., Dentsply, 399 F.3d at 188 (noting that Dentsply
"has had a persistently high market share between 75% and
80% on a revenue basis, in the artificial tooth market" and
holding that "Dentsply’s share of the market is more than ade-
11
The United States, as amicus curiae, requested that the case be
remanded to the district court for application of the correct standard in
determining the adequacy of the geographic market allegation.
24 DUPONT v. KOLON INDUSTRIES
quate to establish a prima facie case of power") (internal quo-
tation marks omitted); Domed Stadium Hotel, Inc. v. Holiday
Inns, Inc., 732 F.2d 480, 489 (5th Cir. 1984) ("Supreme Court
cases, as well as cases from this court, suggest that absent
special circumstances, a defendant must have a market share
of at least 50 percent before he can be guilty of monopoliza-
tion."). Further, some courts have also focused on the durabil-
ity of the defendant’s market power, particularly with an eye
toward other firms’ (in)ability to enter the market. See, e.g.,
Reazin v. Blue Cross & Blue Shield of Kansas, Inc., 899 F.2d
951, 967-68 (10th Cir. 1990).
Here, the district court assumed that Kolon adequately pled
possession of monopoly power. That assumption was correct,
given that Kolon pled, among other things, that: numerous
barriers to entry into the U.S. para-aramid fiber market exist
and supply is low; DuPont has long dominated the U.S. para-
aramid fiber market; and DuPont currently controls over 70
percent of that market, i.e., that "DuPont’s market share
remains greater than 70% of all sales by purchase volume of
para-aramid fiber in the United States." [J.A. 559, 748] See
Advanced Health-Care Servs., 910 F.2d at 147 ("In its com-
plaints, the plaintiff contends that [defendants] have a domi-
nant share of the [product] markets in their respective relevant
geographic areas and that this constitutes monopoly power or
a dangerous probability of actual monopolization. These alle-
gations could, if proven, support a finding of monopolization
or a dangerous probability of monopolization of the relevant
DME markets at stake.").
Further, regarding the relevant market, there is no dispute
that the product market is that for para-aramid fibers. And we
have already held that the pled geographic market, para-
aramid fiber supply to commercial consumers in the United
States, was sufficient to withstand DuPont’s Rule 12(b)(6)
motion.
As to the second element of a monopolization claim, willful
maintenance of monopoly power, Kolon’s Counterclaim
DUPONT v. KOLON INDUSTRIES 25
focuses on DuPont’s use of essentially exclusive agreements
with key para-aramid fiber purchasers. Although not per se
illegal, exclusive dealing arrangements may be an improper
means of acquiring or maintaining a monopoly. See, e.g.,
Grinnell, 384 U.S. at 576; Tampa Electric, 365 U.S. at 324,
327; Microsoft, 253 F.3d at 70-71.
In Tampa Electric, the Supreme Court held that an exclu-
sive dealing arrangement does not violate antitrust law unless
its probable effect is to "foreclose competition in a substantial
share of the line of commerce affected." 365 U.S. at 327. The
market share foreclosed is important because, for the contract
to adversely affect competition, "the opportunities for other
traders to enter into or remain in that market must be signifi-
cantly limited . . . ." Id. at 328. In Tampa Electric, the perti-
nent contract affected less than one percent of the relevant
market, which was "quite insubstantial," and did not violate
the Clayton or Sherman Acts. Id. at 333, 335. "Because an
exclusive deal affecting a small fraction of a market clearly
cannot have the requisite harmful effect upon competition, the
requirement of a significant degree of foreclosure serves a
useful screening function" for such antitrust cases. Microsoft,
253 F.3d at 69.
In Microsoft, the D.C. Circuit indicated that "[a] monopo-
list’s use of exclusive contracts, in certain circumstances, may
give rise to a [Sherman Act] § 2 violation even though the
contracts foreclose less than [a] roughly 40% or 50% share
. . . ." Id. at 70. Microsoft had exclusive agreements with four-
teen of the top fifteen access providers in North America,
ensuring that its browser was offered as the default browser
or as the only browser to the majority of internet users in that
area. Id. at 70-71. The exclusive deals helped maintain Micro-
soft’s monopoly and thus violated Section 2 of the Sherman
Act. Id.
Here, Kolon alleged that DuPont’s use of multi-year exclu-
sive contracts with high-volume para-aramid fiber purchasers
26 DUPONT v. KOLON INDUSTRIES
constituted improper anticompetitive conduct. Kolon alleged
that DuPont used the contracts "with the highest volume pur-
chasers in the most important commercial sustainable para-
aramid categories," committing those valuable customers such
as "leading U.S. producers of optic fiber" and "one of the
largest U.S. branded tire manufacturers" to buying from
DuPont. [J.A. 564] Kolon pled that the contracts "not only
limited the overall volume of para-aramid supply available to
competition, but has also severely limited Kolon from compe-
tition for the most important customers in categories needed
to gain a foothold for effective competition to DuPont." [J.A.
564]
Kolon complained that "[b]ecause DuPont’s supply con-
tracts severely restricted access to customers and preclude
effective competition, DuPont’s conduct has had a direct, sub-
stantial and adverse effect on competition. And DuPont’s
anticompetitive conduct has allowed it to control output and
increase prices for para-aramid fiber in the United States."
[J.A. 565] And "[b]y precluding Kolon from competition for
these customers when demand for para-aramid fibers has sig-
nificantly increased and supply is low, DuPont’s conduct has
constrained the only potential entrant to the United States in
decades from effectively entering the market, reducing if not
practically eliminating additional competition, as well as pre-
serving and growing DuPont’s monopoly position." [J.A. 565]
These allegations are sufficient to withstand a motion to dis-
miss. See Advanced Health-Care Servs., 910 F.2d at 147
(allegation of a dominant market share coupled with exclu-
sionary conduct sufficient to withstand a motion to dismiss).12
12
While Kolon did not allege a specific percentage of market foreclo-
sure in its Counterclaim, it would be problematic to reject its Counter-
claim, with its extensive factual allegations, solely on that basis at the pre-
discovery, motion-to-dismiss stage, when Kolon likely has insufficient
information to calculate a precise number. In contrast, Microsoft, 253 F.3d
34, and Tampa Electric, 365 U.S. 320, in which foreclosure percentages
were determined, were decided after a bench trial and on summary judg-
ment, respectively.
DUPONT v. KOLON INDUSTRIES 27
DuPont argues that the agreements it produced to Kolon
and which may properly be considered on its motion to dis-
miss doom Kolon’s exclusivity claim. We disagree. As
DuPont notes, the agreements required customers to buy
somewhat less than all of their para-aramid fiber requirements
from DuPont. However, as the district court stated, it may be
unrealistic to expect consumers to seek out a mere 15 percent
of their requirements for a specialized, integrated product like
para-aramid fibers from a second supplier.
Further, despite DuPont’s argument to the contrary, the
"meet or release" clauses are also restrictive. As the district
court indicated, "to win business that DuPont controls by a
supply agreement with a ‘meet or release’ clause, Kolon must
make a shot-in-the-dark price offer, hope that the offer beats
DuPont’s price (which it has no way of knowing) by 2% or
more, then hope that DuPont decides not to match Kolon’s
price. . . . Although these clauses may provide some incre-
mental check on DuPont’s ability to raise prices to anticompe-
titive levels, they pose a formidable hurdle to competing for
the customers who have agreed to these deals." [J.A. 756]
DuPont also contends that the purportedly exclusive agree-
ments were not sufficient in duration to prevent Kolon from
entering and competing in the market. DuPont points to the
fact that none of the four agreements produced had a term of
longer than two years. While the four contracts DuPont has
thus far produced may well be so limited, Kolon did not plead
that all of DuPont’s exclusive agreements lasted for only two
years or less. Rather, Kolon pled that the exclusive deals were
"multi-year." And, as already discussed, relying on DuPont’s
statement that the four produced contracts are the only agree-
ments relevant to Kolon’s Counterclaim is improper. Taking
Kolon’s allegations as true and making all inferences in its
favor, as we must on a motion to dismiss, see Nemet Chevro-
let, 591 F.3d at 253, DuPont’s argument fails.
28 DUPONT v. KOLON INDUSTRIES
In sum, Kolon adequately pled all elements of its monopo-
lization claim. We therefore have no basis on which to affirm
the district court’s dismissal of that claim and reverse.
C. Kolon’s Attempted Monopolization Claim
Attempted monopolization employs "methods, means and
practices which would, if successful, accomplish monopoliza-
tion, and which, though falling short, nevertheless approach
so close as to create a dangerous probability of it." M & M
Med. Supplies & Servs., Inc. v. Pleasant Valley Hosp., Inc.,
981 F.2d 160, 166 (4th Cir. 1992) (internal quotation marks
omitted). To state a claim for attempted monopolization, a
claimant must plead: (1) the use of anticompetitive conduct,
(2) with specific intent to monopolize, and (3) a dangerous
probability of success. Spectrum Sports, 506 U.S. at 456;
Advanced Health-Care Servs., 910 F.2d at 147.
In this case, we held above that Kolon adequately pled
DuPont’s use of anticompetitive, exclusive agreements with
high-volume para-aramid customers. Kolon has therefore
cleared the bar as to the first element—anticompetitive con-
duct.
As to the second element, specific intent to monopolize,
this Court has previously stated that "[s]pecific intent may be
inferred from the defendant’s anticompetitive practices." M &
M Med. Supplies, 981 F.2d at 166. We have already held that
Kolon adequately pled anticompetitive practices. Further,
Kolon alleged various actions undertaken by DuPont over
time to protect its dominant market position, including: suc-
cessfully seeking and obtaining a ban against imports of cer-
tain para-aramid fibers into the United States in 1986;
"scar[ing] off" others in the industry through trade disputes;
and fighting the U.S. International Trade Commission’s revo-
cation of antidumping duties on para-aramid fibers. [J.A. 557-
59] Kolon has therefore sufficiently pled specific intent to
monopolize.
DUPONT v. KOLON INDUSTRIES 29
The third and final element of Kolon’s attempted monopo-
lization claim is a dangerous probability of success. "In order
to determine whether there is a dangerous probability of
monopolization, courts have found it necessary to consider
the relevant market and the defendant’s ability to lessen or
destroy competition in that market." Spectrum Sports, 506
U.S. at 456. Given that we held above that Kolon adequately
pled actual monopolization, we can reach no conclusion other
than that Kolon adequately pled a dangerous probability of
success as to DuPont’s attempted monopolization.
Because Kolon adequately pled all elements of its
attempted monopolization claim, we have no basis on which
to affirm the district court’s dismissal and therefore reverse.
See Advanced Health-Care Servs., 910 F.2d 139 (allegation of
dominant market share coupled with exclusionary conduct
sufficient to withstand motion to dismiss monopolization and
attempted monopolization claims).
V.
In sum, the district court erred both in holding that Tampa
Electric required the Netherlands and Korea to be included in
Kolon’s relevant geographic market definition and in consid-
ering facts beyond the pleadings and construing them against
Kolon to dismiss Kolon’s Counterclaim. Because Kolon plau-
sibly pled monopolization and attempted monopolization in
violation of Section 2 of the Sherman Act, we reverse.
REVERSED