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Civil RICO: How Ambiguity Allowed the

Racketeer Influenced and Corrupt

Organizations Act to !pand "eyond ItsIntended #urpose

Lee Coppola & Nicholas DeMarco

I. INTRODUCTION

We nonetheless recognize that, in its private civil version, RICO is

evolving into something !ite "i##erent #rom the original conception o#

its enactors.$

Congress enacte" the Rac%eteer In#l!ence" an" Corr!pt Organizationsct 'RICO( as Title I) o# the Organize" Crime Control ct o# $*+. -TheOrganize" Crime Control ct o# $*+ so!ght the era"ication o# organize"crime in the Unite" /tates0 12 enhancing e3isting legal tools in theevi"ence4gathering process0 an" esta1lishing ne5 penal prohi1itions,05hich incl!"e" RICO.6 t its inception, the /enate committee reportaccompan2ing the #inal version o# the Organize" Crime Control ct o#$*+ state" that the p!rpose o# RICO 5as the elimination o# thein#iltration o# organize" crime an" rac%eteering into legitimateorganizations operating in interstate commerce.07

One o# the principal reasons #or the !n#oreseen an" !nprece"ente"e3pansion o# RICO, especiall2 in civil cases, is the 1roa" an" am1ig!o!s

lang!age o# the stat!te.8

This has ma"e it a po5er#!l 5eapon against$ . /e"ima, /.9.R.L. v. Imre3 Co., Inc., 7+6 U./. 7+*, 8 '$*:8(.- . $: U./.C. ;; $*@ORA9. BO/>9?, CIILRICO D>EINITI>@UID>6 '6" e". -$(.8 . See Davi" F!rz5eil, Criminal and Civil RICO: Traditional Canons of Statutory

Interpretation and the Liberal Construction Clause, 6 COLUM. B.L. & /OC. 9ROG/. 7$, 7-4

77 '$**.

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-7- CRI#I$%L %$& CI'IL CO$(I$)#)$T Hol. 6:-7$persons engage" in prohi1ite" rac%eteering activities.

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-$- CI'IL RICO -76comman",0 or other 1!siness4li%e attri1!tes an" that co!rts co!l" in#er thee3istence o# an enterprise 12 its pattern o# rac%eteering activit2.$:

It is important to note that the co!rts have o#ten ta%en a li1eral approachto interpreting RICO 1eca!se 5hen it 5as enacte", Congress incl!"e" a

li1eral constr!ction cla!se0 that states, The provisions o# this title shall1e li1erall2 constr!e" to e##ect!ate its reme"ial p!rposes.0$*While man2co!rts have ta%en this cla!se to heart, the /!preme Co!rt !ali#ie" itsp!rpose sa2ing, This cla!se o1vio!sl2 see%s to ens!re that CongressJ Hsicintent is not #r!strate" 12 an overl2 narro5 rea"ing o# the stat!te, 1!t it isnot an invitation to appl2 RICO to ne5 p!rposes that Congress neverinten"e".0-

One o# the !"iciar2Js most important responsi1ilities in o!r societ2 is itsinterpretation o# the la5s passe" 12 the legislat!re.-$Conce"e"l2, man2 o#o!r la5s incl!"e am1ig!o!s an" vag!e terminolog2 in their provisions. --

?o5 a co!rt, most importantl2 the /!preme Co!rt, !ltimatel2 interprets apartic!lar stat!te or 5or"s 5ithin a stat!te can have reso!n"ing

conse!ences on its application. This Note 5ill e3plore ho5 RICO has1een li1erall2 treate" an" ho5 its scope has 1een e3tensivel2 1roa"ene" 12the co!rts, especiall2 the /!preme Co!rt. In partic!lar, this Note 5ill #oc!son the "evelopment o# the civil ca!se o# action in RICO, its treatment 12the co!rts, an" ho5 it is !se" to"a2.

9art II o# this Note anal2zes the 1ac%gro!n" an" legislative histor2 o#the RICO stat!te. 9art III e3amines the treatment o# civil RICO 12 theco!rts, in partic!lar, the /!preme Co!rt. Einall2, 9art I e3plores ho5!"icial treatment o# RICO has allo5e" civil litigants access to #e"eralco!rt an" has allo5e" man2 s!rprising, !nanticipate" claims to come#or5ar".

II. GCF@ROUNDNDL>@I/LTI>?I/TORA

Tr2ing to !n"erstan" CongressJs intent #or enacting RICO an" "ra#tingits provisions in s!ch 1roa", mallea1le lang!age sho!l" 1egin 5ith at leasta 1asic !n"erstan"ing, i# not an appreciation, o# the !ni!e, m!lti#ario!senem2 it so!ght to era"icate the merican Ma#ia.

The merican Ma#ia, an Italian4merican organize" crime net5or%5ith operations in cities across merica, partic!larl2 Ne5 Aor% an"

$: . Id. at --78 'We see no 1asis in the lang!age o# RICO #or the str!ct!ral

re!irements that petitioner as%s !s to recognize. s 5e sai" in Tur*ette, an associate4in4#act

enterprise is simpl2 a contin!ing !nit that #!nctions 5ith a common p!rpose.0(.$* . 9!1. L. No. *$478$- 'co"i#ie" as $: U./.C. ; $*rnst & Ao!ng, 8+ U./. $+, $:6 '$**6(.-$ . See Mass. v. Mellon, -n"icott,La, is $ecessarily 'ague, + L>@LT?>ORA6

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-77 CRI#I$%L %$& CI'IL CO$(I$)#)$T Hol. 6:-7$Chicago, rose to po5er thro!gh its s!ccess in the illicit li!or tra"e0 "!ringthe $*-s.-6t that time, Italian4merican gangs 'along 5ith other ethnicgangs( entere" the 1ooming 1ootleg li!or 1!siness an" trans#orme"themselves into sophisticate" criminal enterprises, s%ille" at sm!ggling,mone2 la!n"ering, an" 1ri1ing police an" other p!1lic o##icials.0-7

s the mo1Js po5er gre5, so "i" its organization. In $*6$, mo1sterL!c%2 L!ciano mastermin"e" the esta1lishment o# the Commission.0-8

This Commision 5o!l" serve as the central governing 1o"2 #or more than- Italian4merican crime gro!ps, or #amilies, then operating in the Unite"/tates.0-

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-$- CI'IL RICO -78an" tho!san"s o# associates across the co!ntr2.066

D!ring the Ma#iaJs t5entieth cent!r2 rise to po5er, #e"eral la5en#orcement agencies ma"e #e5 inroa"s in stopping the Ma#iaJs rise,partic!larl2 1eca!se some government lea"ers, incl!"ing EGI Director B.

>"gar ?oover, voice" s%epticism a1o!t the e3istence o# a national Italian4merican organize" crime net5or%, an" s!ggeste" that crime gangsoperate" strictl2 on a local level.067 It 5as not !ntil $*8 5hen a U./.senator #rom Tennessee, >stes Fe#a!ver, la!nche" an investigation intoorganize" crime an" hel" televise" p!1lic hearingsPthe #irst time an2part o# the #e"eral government p!1licl2 recognize" the e3istence o# themerican Ma#ia.068The primar2 #!nction o# the Fe#a!ver Committee 5asto ma%e a #!ll, complete st!"2 an" investigation to "etermine 5hetherorganize" crime !tilizes the #acilities o# commerce, or 5hether it operatesother5ise thro!gh the aven!es o# interstate commerce to promote an2transactions.6

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-7< CRI#I$%L %$& CI'IL CO$(I$)#)$T Hol. 6:-7$p!1lic a1o!t organize" crimePcom1ating an" "e#ining it an" setting thestage #or the RICO stat!tePthe legislative histor2 o# the Organize" CrimeControl ct o# $*+, an" s!1se!entl2 RICO, starts 5ith the 9resi"entJsCommission on La5 >n#orcement an" "ministration o# B!stice in $*

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-$- CI'IL RICO -7+the merican Ma#ia as something that epitomizes, i# it "oes not e3ha!st,the concept o# organize" crime,0 an" place" prominence in organize"crimeJs in#iltration o# legitimate 1!sinesses, la1or organizations, an" itscorr!ption o# government activities.8

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-7: CRI#I$%L %$& CI'IL CO$(I$)#)$T Hol. 6:-7$an" high4level mo1sters.

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-$- CI'IL RICO -7*in!re" 12 rac%eteering activit2.+6

E!rthermore, the /!preme Co!rt "eclare", RICO 5as an aggressiveinitiative to s!pplement ol" reme"ies an" "evelop ne5 metho"s #or #ightingcrime.0+7The Co!rt also a""resse" the arg!ment, !se" 12 opponents o#

RICO since its inception, #or a narro54scope that 5as 1ase" on the premisethat too 1roa" o# an interpretation 5o!l" ma%e RICO too eas2 a 5eaponagainst innocent 1!sinessmen,0 an" 5o!l" 1e prone to a1!se.+8 Inreecting this arg!ment, B!stice White again emphasize" ho5 RICO 5as to1e interprete" in a 1roa", li1eral manner stating

Aet Congress 5ante" to reach 1oth legitimate0 an" illegitimate0

enterprises. The #ormer eno2 neither an inherent incapacit2 #or criminal

activit2 nor imm!nit2 #rom its conse!ences. The #act that ; $*

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-8 CRI#I$%L %$& CI'IL CO$(I$)#)$T Hol. 6:-7$RICOJs provisions 5henever the2 can allege in goo" #aith t5o instances

o# mail or 5ire #ra!".:$

In a separate "issenting opinion, B!stice 9o5ell arg!e" that thelegislative histor2 ma"e it clear that RICO 5as inten"e" to 1e applie" toorganize" crime an" that an2 e##ect it ha" 1e2on" s!ch crime 5as meant to

1e onl2 inci"ental.:-9o5ell a"vocate" that Hthe stat!te ma2 an" sho!l" 1erea" narro5l2 to con#ine its reach to the t2pe o# con"!ct Congress ha" inmin". It is the "!t2 o# this Co!rt to implement the !ne!ivocal intention o#Congress.0:6

This "ichotom2 o# the Co!rt epitomize" 12 the opinions in Sedimapersiste". In several RICO cases since Sedima, the Co!rt has e3pan"e" inpivotal 5a2s the stat!teJs lang!age an" 1rea"th.:7?o5ever, there are also a#e5 nota1le cases 5here the Co!rt has "ecline" to e3pan" RICOJscoverage, restricting the stat!teJs applications.:8 Eollo5ing Sedima, thene3t signi#icant revisiting o# RICO 12 the Co!rt occ!rre" in $*:* in +.2.Inc. v. $orth,estern Bell Telephone Co., 5hich allo5e" the Co!rt to1olster theSedimamaorit2Js treatment o# RICOJs legislative histor2 an"

again reect the arg!ment #or a narro5 constr!ction.:3posJ move to Washington 1e#ore event!all21eing sent to ar1itration, 5here ar1iters r!le" in #avor o# Maor Leag!eGase1all, permitting the move to Washington.$$-

In another instance o# !sing RICO in an !nor"inar2 manner, a Goston!r2 Hin -$ #o!n" that pharmace!tical giant 9#izer . . . ha" violate" theHRICO ct in its mar%eting o# the epileps2 "r!g Ne!rontin #or !ses theEoo" an" Dr!g "ministration never approve".0$$6 The !r2Js S7+.7million ver"ict 5as a!tomaticall2 triple" !n"er the RICO ctJs Htre1le"amages provision,0 highlighting !st ho5 l!crative a RICO s!it co!l" 1e#or potential civil litigants.$$7

#ter the 9#izer ver"ict, in -$ Gritish 9etrole!m 'G9( 5as name" in atleast three la5s!its that acc!se" the oil giant o# committing a long4termseries o# crimes 12 concealing #la5s in "eep45ater "rilling plans an"lac%ing sa#eg!ar"s to contain a catastrophic @!l# o# Me3ico spill.0$$8The

$+ . Nicholas R. Mancini, #obsters in the #onastery5, : RO@>R WILLIM/ U. L.

R>. $*6, $*< '--(.$: . Id.at $*74*8.$* . Id.$$ . Id. at -66467.$$$ . M!rra2 Chass, G/>GLL=% 0roup6s Rac*eteering Suit Brings Baseball to (ull

Bristle, N.A. TIM>/, B!l2 $+, --, http555.n2times.com--+$+sports1ase1all4a4

gro!p4s4rac%eteering4s!it41rings41ase1all4to4#!ll41ristle.html.$$- . Ruling clears ,ay for move to &.C., //OCIT>D9R>//, Nov. $8, -7, available

at httpsports.espn.go.comml1ne5sstor2i"$*-67$+.$$6 . 1igail Eiel", Legal Briefing: !fi7er (ound 0uilty of !ushing $eurontin for

napproved ses, DILAEINNC>'Mar. -:, -$( http555."ail2#inance.com-$6-:legal41rie#ing4p#izer4loses4$7-4million4in4ne!rontin4case 'last visite" Ban. 6$, -$-(.$$7 . Id.$$8 . Travis Donovan,B!: RICO La, #ade To Combat #afia sed %gainst Oil 0iant

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-87 CRI#I$%L %$& CI'IL CO$(I$)#)$T Hol. 6:-7$la5s!its acc!se" the compan2 o# violating RICO committing 5ire an"mail #ra!" over a n!m1er o# 2ears 12 #iling #alse "oc!ments 5ith the U./.government, an" 12 mislea"ing investors thro!gh other "oc!ments an"#alsehoo"s.0$$