excerpted from Manual for Complex Litigation, 1995 ed.
33.8 Civil RICO fn1273
.82 Defining and Managing the Issues
.83 Related Litigation
.85 Final Pretrial Conference
The pleadings play an especially important role in civil RICO fn1274 cases.
Because RICO applies to a broad range of conduct, often occurring over an
extended period of time and involving a large number of people or entities,
the complaint will often assert numerous claims against numerous parties.
Since most RICO complaints allege underlying acts of mail, wire, or
securities fraud, which must be pleaded with particularity under Fed. R.
Civ. P. 9(b), the complaint may be lengthy and complex.
The strict pleading requirements peculiar to RICO (discussed further below)
may result in extensive motion practice directed at dismissing all or parts
of the complaint. Decision of these motions can significantly affect the
scope of the litigation; eliminating claims will not only obviate discovery
and other proceedings related to the claims themselves, but may remove the
jurisdictional predicate for supplemental state law claims, fn1275 allowing
them to be dismissed as well (usually without prejudice). fn1276
The court should therefore adopt procedures for RICO cases designed to test
the sufficiency of the pleadings early on, before other significant
litigation activity commences. Some courts have standing orders requiring
parties alleging RICO claims to file RICO case statements, amplifying and
clarifying the allegations in the pleading. In courts that do not, the court
may adopt a case order requiring submission of such statements before
responsive motions or pleadings are due. fn1277
These statements, together with a careful reading of the complaint, will
help narrow the issues and allow early identification of claims insufficient
on their face, which may be dismissed (with or without prejudice) before
significant time and effort is spent on them. The length and complexity of
RICO complaints may justify granting defendants additional time to respond.
The court should consider entering an order immediately following assignment
of the litigation suspending the time for defendants to respond until after
the initial conference. At the conference, counsel and the court may be able
to narrow the issues, avoiding unnecessary motion practice. At the
conclusion of the conference or shortly thereafter, the court should set a
schedule for filing motions and opposing and reply briefs, as well as
33.82 Defining and Managing the Issues
Efficient management of RICO litigation requires that the disputed legal and
factual issues and the precise statutory violations alleged be identified
and, where possible, narrowed, as early as possible. This is made difficult
by the complexity of the RICO statute and the fact that the terms it
employs, such as "person," "enterprise," "conduct," and "pattern," have been
given varying and sometimes confusing interpretations. Reference to the four
categories of unlawful conduct specified in 18 U.S.C. 1962 will assist the
1. Section 1962(a): Investment of income. This subsection makes it unlawful
for "any person who has received any income derived . . . from a pattern of
racketeering activity . . . to invest . . . any part of such income . . . in
acquisition of an interest in, or the establishment or operation of, any
enterprise . . . ."
Most courts have ruled that the only injury compensable under 1962(a) is
that resulting from a defendant's investment of racketeering income. fn1278
Therefore, claims under 1962(a) alleging injury resulting from
racketeering activity alone, rather than from the investment of income so
derived, may be subject to early dismissal.
2. Section 1962(b): Interest/control.
This subsection makes it unlawful for a person "to acquire or maintain . . .
any interest in or control of any enterprise" through a pattern of
racketeering activity. Most courts have required that the alleged injury to
the plaintiff proximately result from the defendant's acquisition of an
interest in, or control over, an enter-prise. fn1279 If the complaint does
not allege injury arising specifically from such an acquisition, 1962(b)
claims may be subject to dismissal.
3. Section 1962(c): Conduct of an enterprise.
Most civil RICO claims are filed under 1962(c), which makes it unlawful to
"conduct or participate, directly or indirectly, in the conduct" of an
enterprise through a pattern of racketeering activity. The four primary
elements of this subsection, as set out by the Supreme Court, are "(1)
conduct (2) of an enterprise (3) through a pattern (4) of racketeering
The interpretation of the first three of these requirements (the fourth is
relatively uncontroversial) is shrouded in considerable uncertainty, only
some of which has been resolved by the Court. The judge should therefore
give early attention to determining the definitions applied in the circuit.
* "Conduct." The Supreme Court has ruled that liability for
"participat[ing]" in the "conduct" of the enterprise extends only to those
who "have some part in directing [the enterprise's] affairs," adopting the
"operation or management" test articulated by the Eighth Circuit. fn1281
The defendant need not be in upper management; liability may extend to
lower-level employees under the direction of upper management, persons
associated with the enterprise who exert control over it (for example, by
bribery), and outsiders who participate in the operation or management of
the enterprise. fn1282
Nevertheless, the allegations against at least some defendants, particularly
outsiders (such as accountants, attorneys, or lenders), may fail to satisfy
the conduct requirement. In some cases, a Rule 12 motion or a motion for
summary judgment may be an appropriate vehicle to resolve this issue. fn1283
* "Enterprise" and "Person." Most courts have ruled that 1962(c) was
designed to punish only the persons who run an enterprise illegally and not
the enterprise itself, which often will be an innocent victim of the
racketeering activity. fn1284 Therefore, 1962(c) requires pleading and
proof of two separate entities a "person" and an "enterprise" with only
the "person" being liable for damages. fn1285
Three different theories have been used to attempt to reach the assets of a
corporate enterprise despite this requirement: (1) affiliated corporations;
(2) vicarious liability; and (3) association-in-fact enterprises.
Circuit law has been divided on these issues. Some courts have ruled that a
subsidiary is an "affiliated corporation," which conducts the affairs of its
separate parent corporation, and thus can be held liable for damages under
1962(c). fn1286 By contrast, all of the federal appeals courts that have
considered the issue have held that an employer alleged to be the RICO
"enterprise" cannot be held vicariously liable under 1962(c) for the acts
of its employees. fn1287
Note, however, that Claims alleging the existence of "association-in-fact
enterprises" pose a more difficult problem, and may not be appropriate for
summary resolution under Rule 12(b)(6) or 56. RICO provides that an
enterprise may be composed of "any union or group of individuals associated
in fact although not a legal entity." fn1288
A RICO enterprise must, however, be a continuing unit that has some type of
organization and constitutes an entity separate and apart from the alleged
pattern of racketeering; fn1289 claims alleging association-in-fact
enterprises have been dismissed on pretrial motions for failure to allege
the requisite continuity, or for failure to identify an enterprise that is
more than a corporate entity and its agents conducting their regular
* "Pattern." The Supreme Court's most recent attempt to define the
"pattern" requirement was in H.J. Inc. v. Northwestern Bell Telephone Co.,
in which it ruled that proving a pattern requires showing that the
racketeering acts "are related" and "amount to or pose the threat of
continued criminal activity." Fn1291 The Court defined "related" acts as
those "that have the same or similar purposes, results, participants,
victims, or methods of commission, or otherwise are interrelated by
distinguishing characteristics and are not isolated events." fn1292
The Court defined "continuity" to require either "a closed period of
repeated conduct" or "past conduct that by its nature projects into the
future with a threat of repetition." fn1293 Whether the acts "establish a
threat of continued racketeering activity depends on the specific facts of
each case." fn1294
Following H.J., courts have dismissed 1962(c) claims in two overlapping
areas for failure to satisfy the pattern requirement. First, where the
allegations involve completed ("closed-ended") conduct lasting twelve months
or less, and where there is no threat of future criminal conduct, courts
have dismissed the claims on motions to dismiss or for summary judgment.
Second, courts have held that claims involving only a single (or a few)
victims cannot pose a threat of long-term criminal conduct, and should be
dismissed even where the conduct complained of lasted for many months or
even years. fn1296
In other cases, courts have applied a multifactor test to determine whether
a pattern of racketeering activity has been pleaded or proved. The factors
considered typically include the nature, number, and variety of predicate
acts; the duration or time span involved; fn1297 the number of victims; the
number of separate transactions involving unlawful conduct; and the presence
of distinct injuries. fn1298
4. Section 1962(d): Conspiracy.
This subsection makes it unlawful to conspire to violate the previous three.
To state a claim under 1962(d), a plaintiff must plead that the defendant
agreed to join the conspiracy, agreed to commit predicate acts, and knew
that those acts were part of a pattern of racketeering activity. fn1299 The
agreement to commit predicate acts, standing alone, is not enough. fn1300
There is a circuit split on two important issues under 1962(d). First,
some courts have held that a RICO conspiracy claim may be stated where a
plaintiff is injured by any acts that further a RICO conspiracy, fn1301
while others require that the acts complained of all be predicate acts as
defined by 1961. fn1302 Second, some courts require that a defendant
agree to commit at least two predicate acts, fn 1303 while others hold that
it is sufficient if a defendant agreed that some member of the enterprise
would commit the predicate acts. fn1304
* Additional issues.
The following issues may also arise in RICO litigation:
- standing: whether a RICO plaintiff has the necessary standing to sue may
be appropriate for resolution under Rule 12 or 56; fn1305
- proximate cause: whether a claimed injury is sufficiently related to the
claimed RICO violation may be appropriate for resolution under Rule 12 or
- propriety of damage claims: some categories of damages, such as claims
for personal injury, may not be allowable under RICO; fn1307
- statute of limitations: although the appeals courts have divided on when
a RICO claim accrues, fn1308 the issue may be appropriate for early
- availability of equitable relief: although the RICO statute provides for
certain equitable remedies, fn1309 these may not be available to private
- arbitration: since an arbitration clause in an agreement between the
parties will be enforced by a federal court to require arbitration of RICO
claims, fn1311 the court should determine early on whether such an agreement
existsthe right to arbitrate may be lost if not promptly invoked; fn1312
- miscellaneous defenses: in some RICO cases, dismissal may be appropriate
under theories of preemption, fn1313 abstention, fn1314 act of state, fn1315
primary jurisdiction, fn1316 and res judicata or collateral estoppel
(discussed further below). fn1317
33.83 Related Litigation
Because the "pattern" pleaded may involve activities in several states,
related RICO actions may be filed in several districts. The procedures for
consolidation or coordination discussed in supra section 31 should therefore
be considered, as appropriate. Because criminal racketeering activity is an
element of civil RICO liability, civil RICO defendants will often be, or
have been, the subject of criminal investigation or prosecution. The court
should determine the existence and status of any related criminal
proceedings, which may have an effect on pretrial and trial planning. Where
criminal and civil RICO cases are proceeding concurrently, the criminal
charges should ordinarily be tried first, without a general stay being
imposed in the civil action.
If related cases have been concluded, the trial judge must consider
potential claim and issue preclusion. RICO provides that a final judgment
in favor of the United States in a criminal proceeding shall estop the
defendant from denying the essential allegations of the criminal offense in
any civil proceeding brought by the United States. fn1318 The statute is
silent on the use of such convictions in civil cases brought by private
parties, but courts may still apply claim and issue preclusion. fn1319
Preclusion may also arise from prior civil litigation, whether in federal or
state court. fn1320
Prior administrative proceedings fn1321 or arbitration awards fn1322 may
also be accorded preclusive effect. Some courts, however, have held that
prior adjudications in bankruptcy court will not bar subsequent civil RICO
actions based on claims which could have been raised in bankruptcy. fn1323
While claim and issue preclusion ordinarily bar the parties or those in
privity with them from relitigating claims or defenses which were, or which
could have been, litigated in a prior proceeding, and from relitigating
factual or legal issues which were actually litigated and essential to a
final judgment, there are considerations common to civil RICO cases that may
operate to bar application of these doctrines in some cases. Different
burdens of proof, fn1324 inability to litigate the issue in the prior
proceeding, fn1325 or lack of knowledge regarding the facts required to
allege a RICO violation fn1326 may prevent application of preclusion
doctrines in a civil RICO action.
The specific elements required to prove a RICO violation may pose special
problems in discovery. The "pattern" requirement may involve discovery into
a RICO defendant's conduct and practices over an extended period of time and
with respect to numerous transactions.
The existence of related criminal proceedings may raise issues such as the
defendant's Fifth Amendment privilege against self-incrimination and the
discoverability of grand jury material. Civil RICO claims may also require
discovery involving foreign countries. These issues must be addressed early
in the litigation, before depositions begin, in order to avoid unnecessary
conflict and discovery motions.
To establish a pattern of racketeering activity, a civil RICO plaintiff must
allege separate predicate acts that are both related and pose a threat of
continuity. fn1327 While discovery into unrelated alleged criminal acts
should therefore ordinarily not be permitted, fn1328 courts must be careful
not to curtail unduly a plaintiff's discovery into alleged wrongdoing,
especially where it relates to other alleged victims of the same pattern of
racketeering activity or to acts within the exclusive knowledge of the
33.85 Final Pretrial Conference fn1330
It may not be possible to determine the sufficiency of some RICO claims
until the parties have conducted discovery. Prior to the final pretrial
conference, the court should require the parties to file statements and
memoranda setting out the claims and defenses that remain viable and the
factual and legal bases therefor. The parties should attempt to reach
stipulations where possible; where disagree-ments remain, motions for
summary judgment, filed in advance by a specified deadline, can be resolved
or at least considered at the conference. If the elimination of RICO or
other federal claims removes the jurisdictional basis for supplemental state
law claims, the court should decide whether it will retain jurisdiction over
Some of the technical issues in civil RICO trials may be particularly
confusing to lay jurors. The court should therefore explain to the jurors
the general nature of the claims. This should be done at an early stage,
either during voir dire or before the parties' opening statements.
In addition to briefly noting the general nature of the case, the court
should outline some of the characteristics and elements of a civil RICO
case. These include the fact that the case is a civil action, not a criminal
proceeding; that the burden of proof is by a preponderance of the evidence,
not beyond a reasonable doubt; fn1331 and that the plaintiff need not prove
that the defendant is a "racketeer" in the everyday sense of that term or is
associated with "organized crime."
The court should urge the parties to submit a joint set of preliminary
comments or instructions for this purpose. To avoid confusion, and to direct
the jurors' attention to the sufficiency of each separate statutory and
common law claim submitted for their decision, special verdicts or a general
verdict with interrogatories should usually be employed.
Issues may be submitted to the jury for decision sequentially, both to
simplify deliberations and to obviate deliberation on issues rendered moot
by an earlier verdict. Some courts have held that the jury should not be
informed that damages awarded on a RICO verdict will automatically be
1273. With acknowledgment to Edward F. Mannino, Esq.
1274. Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C.
1275. See 28 U.S.C. 1367 (supplemental jurisdiction).
1276. See, e.g., Parker & Parsley Petroleum Co. v. Dresser Indus., 972 F.2d
580, 58490 (5th Cir. 1992); Spiegel v. Continental Ill. Nat. Bank, 790 F.2d
638, 64950 (7th Cir. 1986).
1277. See Sample Form infra 41.54.
1278. See, e.g., Parker & Parsley, 972 F.2d at 584; Danielsen v. Burnside-
Ott Aviation Training Ctr., Inc., 941 F.2d 1220, 122930 (D.C. Cir. 1991);
Craighead v. E. F. Hutton & Co., 899 F.2d 485, 494 (6th Cir. 1990); Ouaknine
v. MacFarlane, 897 F.2d 75, 8283 (2d Cir. 1990); Rose v. Bartle, 871 F.2d
331, 35658 (3d Cir. 1989); Grider v. Texas Oil & Gas Corp., 868 F.2d 1147,
114951 (10th Cir. 1989). Contra Busby v. Crown Supply, Inc., 896 F.2d 833,
837 (4th Cir. 1990) (en banc).
1279. See, e.g ., Danielsen v. Burnside-Ott Aviation Training Center, Inc.,
941 F.2d 1220 (D.C. Cir. 1991); Kehr Packages, Inc. v. Fidelcor, Inc., 926
F.2d 1406 (3d Cir.), cert. denied , 111 S. Ct. 2839 (1991); Airlines
Reporting Corp. v. Barry, 666 F. Supp. 1311, 1315 (D. Minn. 1987).
1280. Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 (1985).
1281. Reves v. Ernst & Young, 113 S. Ct. 1163, 116870 (1993), referring to
Bennett v. Berg, 710 F.2d 1361, 1364 (8th Cir. 1983) (en banc).
1282. Reves, 113 S. Ct. at 1173.
1283. Outsiders may still be liable as conspirators (under 1962(d)) or
under an "aiding and abetting" theory, which has been recognized by two
federal appeals courts. See Petro-Tech, Inc. v. Western Co., 824 F.2d 1349,
1356, 135960 (3d Cir. 1987); Armco Indus. Credit Corp. v. SLT Warehouse
Co., 782 F.2d 475, 48586 (5th Cir. 1986).
1284. See, e.g., Board of County Comm'rs v. Liberty Group, 965 F.2d 879, 885
(10th Cir.), cert. denied , 113 S. Ct. 329 (1992); Yellow Bus Lines, Inc. v.
Local Union 639, 883 F.2d 132, 13940 (D.C. Cir. 1989); Schofield v. First
Commodity Corp., 793 F.2d 28, 2930 (1st Cir. 1986); Bennett v. United
States Trust Co., 770 F.2d 308, 315 (2d Cir. 1985); B.F. Hirsch v. Enright
Refining Co., 751 F.2d 628, 634 (3d Cir. 1984); Rae v. Union Bank, 725 F.2d
478, 481 (9th Cir. 1984).
1285. See, e.g., Bennett v. Berg, 685 F.2d 1053, 106162 (8th Cir. 1982).
1286. See, e.g., Haroco, Inc. v. American Nat. Bank & Trust Co., 747 F.2d
384, 40203 (7th Cir. 1984), aff'd on other grounds, 473 U.S. 606 (1985);
Center Cadillac, Inc. v. Bank Leumi Trust Co., 808 F. Supp. 213, 23637
(S.D.N.Y. 1992). Contra NCNB Nat'l Bank v. Tiller, 814 F.2d 931, 93637 (4th
Cir. 1987), overruled on other grounds, Busby v. Crown Supply, Inc., 896
F.2d 833, 84041 & n.8 (4th Cir. 1990) (en banc); In re Tucker Freight
Lines, Inc., 789 F. Supp. 884, 893 (W.D. Mich. 1991).
1287. See Parker & Parsley Petroleum Co. v. Dresser Indus., 972 F.2d 580,
584 (5th Cir. 1992); Board of County Comm'rs v. Liberty Group, 965 F.2d 879,
885, 886 (10th Cir.), cert. denied, 113 S. Ct. 329 (1992); Miranda v. Ponce
Fed. Bank, 948 F.2d 41, 45 (1st Cir. 1991); Brittingham v. Mobil Corp., 943
F.2d 297, 30003 (3d Cir. 1991); Landry v. Air Line Pilots Ass'n Int'l, 901
F.2d 404, 425 (5th Cir. 1990); Yellow Bus Lines, Inc. v. Local Union 639,
883 F.2d 132, 140 (D.C. Cir. 1989); D & S Auto Parts, Inc. v. Schwartz, 838
F.2d 964, 96768 (7th Cir. 1988); Petro-Tech, Inc. v. Western Co., 824 F.2d
1349, 135960 (3d Cir. 1987); Luthi v. Tonka Corp., 815 F.2d 1229, 1230 (8th
Cir. 1987); Schofield v. First Commodity Corp., 793 F.2d 28, 32 (1st Cir.
Note, however, that some courts permit vicarious liability where an
employer is benefited by its employees' 1962(c) violations, if the
employer is distinct from the enterprise. See, e.g., Brady v. Dairy Fresh
Prods. Co., 974 F.2d 1149, 1154 (9th Cir. 1992); Petro-Tech, 824 F.2d at
Vicarious liability has also been found proper under other subsections of
1962. See, e.g., Quick v. Peoples Bank of Cullman County, 993 F.2d 793,
79798 (11th Cir. 1993) ( 1962(b)). See generally A Proposal for the
Application of Vicarious Liability Under Civil RICO (American College of
Trial Lawyers 1994).
1288. 18 U.S.C. 1961(4). While some have argued that this definition
limits associations-in-fact to groups of individuals, that argument has
found little support in the decisions. See, e.g., Atlas Pile Driving Co. v.
DiCon Fin. Co., 886 F.2d 986, 995 n.7 (8th Cir. 1989); Shearin v. E.F.
Hutton Group, Inc., 885 F.2d 1162, 116566 (3d Cir. 1989). But see In re
Tucker Freight Lines, Inc., 789 F. Supp. 884, 893 (W.D. Mich. 1991).
1289. United States v. Turkette, 452 U.S. 576, 583 (1981).
1290. See, e.g., Parker & Parsley, 972 F.2d at 583; Brittingham v. Mobil
Corp., 943 F.2d 297, 30003 (3d Cir. 1991) ("a 1962(c) enterprise must be
more than an association of individuals or entities conducting the normal
affairs of a defendant corporation"); Yellow Bus Lines, 883 F.2d at 141
("allowing plaintiffs to generate such 'contrived partnerships' consisting
of an umbrella organization and its subsidiary parts, would render the non-
identity requirement of section 1962(c) meaningless. We decline to permit
such an 'end run' around the statutory requirements."); Atkinson v. Anadarko
Bank & Trust Co., 808 F.2d 438 (5th Cir. 1987); Haroco, 747 F.2d at 401,
aff'd on other grounds , 473 U.S. 606 (1985). But see Atlas Pile Driving,
886 F.2d 986 (two members of "association in fact" enterprise could also be
1291. 492 U.S. 229, 239 (1989).
1292. Id. at 240.
1293. Id. at 241.
1294. Id. at 242.
1295. See, e.g., Midwest Grinding Co. v. Spitz, 976 F.2d 1016 (7th Cir.
1992); Uni*Quality, Inc. v. Infotronx, Inc., 974 F.2d 918 (7th Cir. 1992);
Tel-Phonic Servs., Inc. v. TBS Int'l, Inc., 975 F.2d 1134 (5th Cir. 1992);
Hughes v. Consol-Pennsylvania Coal Co., 945 F.2d 594, 60911 (3d Cir. 1991),
cert. denied , 112 S. Ct. 2300 (1992) (holding that "twelve months is not a
substantial period of time" for continuity purposes in a closed-ended
scheme); Feinstein v. RTC, 942 F.2d 34 (1st Cir. 1991); Kehr Packages, Inc.
v. Fidelcor, Inc., 926 F.2d 1406 (3d Cir.), cert. denied , 111 S. Ct. 2839
(1991); Pyramid Sec., Ltd. v. IB Resolution, Inc., 924 F.2d 1114 (D.C.
Cir.), cert. denied, 112 S. Ct. 85 (1991); American Eagle Credit Corp. v.
Gaskins, 920 F.2d 352 (6th Cir. 1990); Delta Pride Catfish, Inc. v. Marine
Midland Bus. Loans, Inc., 767 F. Supp. 951, 96768 (E.D. Ark. 1991);
Johnston v. Wilbourn, 760 F. Supp. 578, 58889 n.16 (S.D. Miss. 1991)
(collecting cases and concluding that in no case in which predicate acts
spanned less than one year in a closed-ended scheme had courts found a
1296. See, e.g., Boone v. Carlsbad Bancorporation, Inc., 972 F.2d 1545, 1556
(10th Cir. 1992); Hindes v. Castle, 937 F.2d 868, 87276 (3d Cir. 1991)
("[i]t remains an open question whether RICO liability is ever appropriate
for a single-scheme, single-victim conduct threatening no future harm");
Lange v. Hocker, 940 F.2d 359 (8th Cir. 1991); Banks v. Wolk, 918 F.2d 418,
422 (3d Cir. 1990); United States Textiles, Inc. v. Anheuser-Busch Cos., 911
F.2d 1261, 126769 (7th Cir. 1990); Sil-Flo, Inc. v. SFHC, Inc., 917 F.2d
1507, 1516 (10th Cir. 1990).
1297. In gauging the duration in cases charging mail or wire fraud, some
courts have held that only the duration of the fraudulent acts is relevant,
and that innocent mailings may not be considered. See, e.g ., Feinstein v.
RTC, 942 F.2d 34, 46 (1st Cir. 1991); Kehr Packages, 926 F.2d at 1418, cert.
denied , 111 S. Ct. 2839 (1991).
1298. See, e.g., Midwest Grinding, 976 F.2d at 102325. These factors are
followed by courts which established this test before H.J. While that test
was not followed in H.J., and while some courts have since found it no
longer permissible, see, e.g., Fleet Credit Corp. v. Sion, 893 F.2d 441,
44546 (1st Cir. 1990), other courts still utilize it. See, e.g., Banks v.
Wolk, 918 F.2d 418, 423 (3d Cir. 1990); United States Textiles, 911 F.2d at
1299. See, e.g., Glessner v. Kenny, 952 F.2d 702, 714 (3d Cir. 1991); Reddy
v. Litton Indus. Inc., 912 F.2d 291 (9th Cir. 1990); Hecht v. Commerce
Clearing House, Inc., 897 F.2d 21 (2d Cir. 1990).
1300. See, e.g., Seville Indus. Mach. Corp. v. Southmost Mach. Corp., 742
F.2d 786, 792 n.8 (3d Cir. 1984).
1301. Schiffels v. Kemper Fin. Servs., Inc., 978 F.2d 344, 34851 (7th Cir.
1992); Shearin v. E.F. Hutton Group, Inc., 885 F.2d 1162, 1169 (3d Cir.
1302. Bowman v. Western Auto Supply Co., 985 F.2d 383 (8th Cir.), cert.
denied , 113 S. Ct. 2459 (1993); Reddy v. Litton Indus., Inc., 912 F.2d 291
(9th Cir. 1990); Hecht, 897 F.2d 21.
1303. See, e.g., Miranda v. Ponce Fed. Bank, 948 F.2d 41 (1st Cir. 1991);
United States v. Rastelli, 870 F.2d 822 (2d Cir. 1989).
1304. See, e.g., United States v. Pryba, 900 F.2d 748 (4th Cir. 1990);
United States v. Kragness, 830 F.2d 842, 860 (8th Cir. 1987); United States
v. Joseph, 835 F.2d 1149 (6th Cir. 1986); United States v. Neapolitan, 791
F.2d 489, 49498 (7th Cir. 1986); United States v. Adams, 759 F.2d 1099 (3d
Cir. 1985); United States v. Tille, 729 F.2d 615, 619 (9th Cir. 1984);
United States v. Carter, 721 F.2d 1514 (11th Cir. 1984).
1305. See, e.g., In re Sunrise Sec. Litig., 916 F.2d 874 (3d Cir. 1990);
Mid-State Fertilizer Co. v. Exchange Nat. Bank, 877 F.2d 1333, 133436 (7th
Cir. 1989); Warren v. Manufacturers Nat. Bank, 759 F.2d 542 (6th Cir. 1985).
See also Ceribelli v. Elghanayan, 990 F.2d 62 (2d Cir. 1993).
1306. See, e.g., Holmes v. Securities Investor Protection Corp., 112 S. Ct.
1311 (1992); Imagineering, Inc. v. Kiewit Pac. Co., 976 F.2d 1303, 131112
(9th Cir. 1992), cert. denied, 113 S. Ct. 1644 (1993); Zervas v. Faulkner,
861 F.2d 823 (5th Cir. 1988); Brandenburg v. Seidel, 859 F.2d 1179 (4th Cir.
1307. See, e.g., Genty v. RTC, 937 F.2d 899, 91819 (3d Cir. 1991); Grogan
v. Platt, 835 F.2d 844 (11th Cir. 1988); Drake v. B.F. Goodrich Co., 782
F.2d 638 (6th Cir. 1986).
1308. See, e.g., McCool v. Strata Oil Co., 972 F.2d 1452, 146466 (7th Cir.
1992); Bivens Gardens Office Bldg., Inc. v. Barnett Bank, 906 F.2d 1546,
155455 (11th Cir. 1990); Keystone Ins. Co. v. Houghton, 863 F.2d 1125, 1130
(3d Cir. 1988).
1309. 18 U.S.C. 1964(a).
1310. Compare In re Fredeman Litig., 843 F.2d 821 (5th Cir. 1988) and
Religious Technology Ctr. v. Wollersheim, 796 F.2d 1076 (9th Cir. 1986) with
Aetna Casualty & Surety Co. v. Liebowitz, 570 F. Supp. 908, 910 n.11
(E.D.N.Y. 1983), aff'd on other grounds, 730 F.2d 905 (2d Cir. 1984).
1311. See, e.g., Shearson/American Express, Inc. v. McMahon, 482 U.S. 220
(1987); Kerr-McGee Ref. Corp. v. M/T Triumph, 924 F.2d 467 (2d Cir.), cert.
denied , 112 S. Ct. 81 (1991).
1312. See, e.g., Van Ness Townhouses v. Mar Indus. Corp., 862 F.2d 754,
75859 (9th Cir. 1988); Faircloth v. Jackie Fine Arts, Inc., 682 F. Supp.
837, 841 (D.S.C. 1988), modified on other grounds, 938 F.2d 513 (4th Cir.
1991). See also Nesslage v. York Sec., Inc., 823 F.2d 231, 234 (8th Cir.
1313. See, e.g., Smith v. Fidelity Consumer Discount Co., 898 F.2d 907 (3d
1314. Coopers & Lybrand v. Sun-Diamond Growers, 912 F.2d 1135 (9th Cir.
1990); Brandenburg, 859 F.2d at 119095.
1315. W.S. Kirkpatrick & Co. v. Environmental Tectonics Corp., Int'l, 110 S.
Ct. 701 (1990).
1316. See, e.g., H.J. Inc. v. Northwestern Bell Tel. Co., 734 F. Supp. 879
(D. Minn. 1990), aff'd , 954 F.2d 485 (8th Cir.), cert. denied, 112 S. Ct.
1317. See, e.g., Saud v. Bank of New York, 929 F.2d 916 (2d Cir. 1991). See
1318. 18 U.S.C. 1964(d).
1319. See, e.g., Appley v. West, 832 F.2d 1021 (7th Cir. 1987); Roso v.
Saxon Energy Corp., 758 F. Supp. 164, 16770 (S.D.N.Y. 1991); Anderson v.
Janovich, 543 F. Supp. 1124, 1132 (W.D. Wash. 1982).
1320. See, e.g., Saud, 929 F.2d 916; Polur v. Raffe, 912 F.2d 52, 5657 (2d
Cir. 1990); Evans v. Dale, 896 F.2d 975, 97778 (5th Cir. 1990); McCarter v.
Mitcham, 883 F.2d 196, 199201 (3d Cir. 1989).
1321. See Fry v. General Motors Corp., 728 F. Supp. 455, 45960 (E.D. Mich.
1322. See, e.g ., Central Transport, Inc. v. Four Phase Sys., Inc., 936 F.2d
256 (6th Cir. 1991); Benjamin v. Traffic Executive Ass'n E. R.R., 869 F.2d
107 (2d Cir. 1989); Rudell v. Comprehensive Accounting Corp., 802 F.2d 926
(7th Cir. 1986); Greenblatt v. Drexel Burnham Lambert, Inc., 763 F.2d 1352,
136062 (11th Cir. 1985).
1323. Barnett v. Stern, 909 F.2d 973, 97882 (7th Cir. 1990); Howell
Hydrocarbons, Inc. v. Adams, 897 F.2d 183 (5th Cir. 1990).
1324. See, e.g., Wilcox v. First Interstate Bank, 815 F.2d 522 (9th Cir.
1325. See, e.g., George v. United Ky. Bank, Inc., 753 F.2d 50 (6th Cir.
1326. See, e.g., Norris v. Wirtz, 703 F. Supp. 1322 (N.D. Ill. 1989).
1327. H.J. Inc. v. Northwestern Bell Tel. Co., 492 U.S. 229 (1989). See
1328. See, e.g., Jolley v. Welch, 904 F.2d 988, 992 (5th Cir. 1990); Olive
Can Co. v. Martin, 906 F.2d 1147, 115253 (7th Cir. 1990); Zerman v. E.F.
Hutton & Co., 628 F. Supp. 1509, 1512 (S.D.N.Y. 1986); PMC, Inc. v. Ferro
Corp., 131 F.R.D. 184 (C.D. Cal. 1990).
1329. See, e.g., Michaels Bldg. Co. v. Ameritrust Co., N.A., 848 F.2d 674,
67981 (6th Cir. 1988); Halperin v. Berlandi, 114 F.R.D. 8, 1113 (D. Mass.
1330. See generally supra 21.6.
1331. See, e.g., Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 491 (1985); In
re EDC, Inc., 930 F.2d 1275, 1280 (7th Cir. 1991); Wilcox v. First
Interstate Bank, N.A., 815 F.2d 522, 53032 (9th Cir. 1987).
1332. See Lerchen v. Merrill Lynch, Pierce, Fenner & Smith, Inc., No. 86-
1158 (E.D. Mich. 1985), aff'd, 817 F.2d 756 (6th Cir. 1987). See also
Pollock & Riley, Inc. v. Pearl Brewing Co., 498 F.2d 1240 (5th Cir. 1974)
Civil RICO Case-Statement Order
It is ORDERED:
The proponent of the civil RICO claim shall file and serve [within days of
] a case statement that shall include the facts relied on to initiate the
RICO claim. In particular, the statement shall use the numbers and letters
set forth below, unless filed as part of an amended and restated pleading
(in which latter case, the allegations of the amended and restated pleading
shall reasonably follow the organization set out below), and shall state in
detail and with specificity the following information:
1. State whether the alleged unlawful conduct is in violation of 18 U.S.C.
1962(a), (b), (c), and/or (d). If you allege violations of more than one
1962 subsection, treat each as a separate RICO claim.
2. List each defendant, and state the alleged misconduct and basis of
alleged liability of each defendant.
3. List the alleged wrongdoers, other than the defendants listed above, and
state the alleged misconduct of each wrongdoer.
4. List the alleged victims, and state how each victim allegedly was
5. Describe in detail the pattern of racketeering activity or collection of
an unlawful debt alleged for each RICO claim. A description of the pattern
of racketeering activity shall:
(a) list the alleged predicate acts and the specific statutes allegedly
violated by each predicate act;
(b) state the dates of the predicate acts, the participants in the
predicate acts, and a description of the facts surrounding each predicate
(c) if the RICO claim is based on the predicate offenses of wire fraud,
mail fraud, fraud in the sale of securities, or fraud in connection with a
case under U.S.C. Title 11, the "circumstances constituting fraud or mistake
shall be stated with particularity," Fed. R. Civ. P. 9(b) (identify the
time, place, and contents of the alleged misrepresentation or omissions, and
the identity of persons to whom and by whom the alleged misrepresentations
or omissions were made);
(d) describe in detail the perceived relationship that the predicate acts
bear to each other or to some external organizing principle that renders
them "ordered" or "arranged" or "part of a common plan"; and
(e) explain how the predicate acts amount to or pose a threat of
continued criminal activity.
6. Describe in detail the alleged enterprise for each RICO claim. A
description of the enterprise shall:
(a) state the names of the individuals, partnerships, corporations,
associations, or other entities allegedly constituting the enterprise;
(b) describe the structure, purpose, roles, function, and course of
conduct of the enterprise;
(c) state whether any defendants are employees, officers, or directors of
the alleged enterprise;
(d) state whether any defendants are associated with the alleged
enterprise, and if so, how;
(e) explain how each defendant participated in the direction of the
affairs of the en-terprise;
(f) state whether you allege [(i) that the defendants are individuals or
entities separate from the alleged enterprise, or (ii) that the defendants
are the enterprise itself, or (iii) that the defendants are] members of the
(g) if you allege any defendants to be the enterprise itself, or members
of the enterprise, explain whether such defendants are perpetrators, passive
instruments, or victims of the alleged racketeering activity.
7. State whether you allege, and describe in detail, how the pattern of
racketeering activity and the enterprise are separate or have merged into
8. Describe the alleged relationship between the activities and the pattern
of racketeering activity. Discuss how the racketeering activity differs from
the usual and daily activities of the enterprise, if at all.
9. Describe what benefits, if any, the alleged enterprise and each defendant
received from the alleged pattern of racketeering activity.
10. Describe the effect of the activities of the enterprise on interstate or
11. If the complaint alleges a violation of 18 U.S.C. 1962(a), provide the
(a) State who received the income derived from the pattern of
racketeering activity or through the collection of an unlawful debt; and
(b) Describe the use or investment of such income.
12. If the complaint alleges a violation of 18 U.S.C. 1962(b), provide the
(a) Describe in detail the acquisition or maintenance of any interest in
or control of the alleged enterprise; and
(b) State whether the same entity is both the liable "person" and the
"enterprise" under 1962(b).
13. If the complaint alleges a violation of 18 U.S.C. 1962(c), provide the
(a) state who is employed by or associated with the enterprise; [and]
(b) state whether the same entity is both the liable "person" and the
"enterprise" under 1962(c).
14. If the complaint alleges a violation of 18 U.S.C. 1962(d), describe in
detail the alleged conspiracy.
15. Describe the alleged injury to business or property.
16. Describe the relationship between the alleged injury and violation of
the RICO statute.
17. List the damages sustained by reason of the violation of 1962,
indicating the amount for which each defendant allegedly is liable.
18. Provide any additional information you feel would be helpful to the
Court in processing your RICO claim.
United States District Judge
Note: This order has been designed to establish a uniform and efficient
procedure for deciding civil actions containing claims made pursuant to 18
U.S.C. 19611968 ("civil RICO").
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