Conspiracy – 1962(d)

A RICO claim is broad but a RICO conspiracy claim is even broader. Anyone who agrees or conspires to pursue the same criminal objective can be held liable for a RICO violation. Salinas v. United States, 522 U.S. 52, 63-64 (1997). “If conspirators have a plan which calls for some conspirators to perpetrate the crime and others to provide support, the supporters are as guilty as the perpetrators.” Id. at 64. A conspirator must simply intend to further an endeavor which, if completed, would satisfy all elements of a civil RICO claim.  Id. at 65; see also CGC Holding Co., LLC v. Broad and Cassel, 773 F.3d 1076, 1088 (10th Cir. 2014) (one conspires to violate RICO by adopting the goal of furthering the enterprise, “even if the conspirator does not commit a predicate act”); United States v. Godwin, 765 F.3d 1306, 1324 (11th Cir. 2014); United States v. Godwin, 765 F.3d 1306, 1324 (11th Cir. 2014) (“[i]n proving the existence of a single RICO conspiracy, the government does not need to prove that each conspirator agreed with every other conspirator, knew of his fellow conspirators, was aware of all of the details of the conspiracy, or contemplated participating in the same related crime”); United States v. Kamahele, 748 F.3d 984, 1006 (10th Cir. 2014) (stating that “the Government does not need to prove that each defendant personally committed two predicate acts to prove a RICO conspiracy” and that “[t]he focus of this element is on the particular Defendant’s agreement to participate in the objective of the enterprise to engage in a pattern of racketeering activity, and not on the particular Defendant’s agreement to commit the individual acts”); United States v. Zemlyansky, 908 F.3d 1, 10 (2d Cir. 2018) (stating that “a jury’s finding that a defendant did not commit certain substantive crimes does not necessarily preclude the government from later proving that he or she knowingly agree to facilitate the racketeering scheme involving, or intending to involve, the same substantive crimes”). Thus, there are two ways to effectively defend against a RICO conspiracy claim: 1) the defendant must prove he never intended to further the criminal endeavor; or 2) the defendant must prove that the endeavor did not satisfy the elements of a civil RICO claim. Because the first defense is fact based, it is seldom an appropriate defense to raise in a dispositve motion. The best way to undermine a claim for conspiracy on a dispositive motion is to undermine the legal sufficiency of the allegations supporting the substantive offense. See Howard v. American Online Inc., 208 F.3d 741, 751 (9th Cir.), cert. denied, 531 U.S. 828 (2000) (a claim under section 1962(d) may not stand unless the plaintiffs can sustain a viable claim under another subsection of section 1962); Grubbs v. Sheakley Group, Inc., 807 F.3d 785, 806 (6th Cir. 2016) (“[t]o state a claim for RICO conspiracy, one must successfully allege all the elements of a RICO violation, as well as an illicit agreement to violate the substantive RICO provision”); Cisneros v. Petland, Inc., 972 F.3d 1204, 1220 (11th Cir. 2020) (“parties cannot be found guilty of conspiring to commit an act that is not itself against the law”).

Just as an attorney may operate and manage an enterprise in violation of section 1962(c), attorneys may be held liable as conspirators where they “cross[] the line” and become part of the criminal organization itself, as “its consigliere and fixer.” United States v. Farrell, 921 F.3d 116, 139 (4th Cir.), cert. denied , 140 S. Ct. 269 (2019).

A RICO plaintiff does not have standing to bring a RICO claim under section 1962(d) unless it is injured by an act of racketeering. For example, in Beck v. Prupis, 529 U.S. 494 (2000), the plaintiff was an executive who allegedly discovered that his corporation was engaged in a scheme to defraud regulators, shareholders and creditors. The plaintiff claimed that when he discovered the scheme and threatened to expose the conspiracy, he was terminated from his job and thereby sustained his own financial loss. The question was whether the plaintiff sustained a compensable injury since his wrongful termination (although not an act of racketeering itself) occurred in furtherance of the defendants’ efforts to conceal the conspiracy to defraud regulators, shareholders, and creditors. The Supreme Court held that the plaintiff lacked standing, stating: “a person my not bring suit under section 1964(c) predicated on a violation of § 1962(d) for injuries caused by an overt act that is not an act of racketeering or otherwise unlawful under the statute.” Id. at 507; see also Davis-Lynch, Inc. v. Moreno, 667 F.3d 539, 551-52 (5th Cir. 2012) (plaintiff was not entitled to summary judgment where it failed to allege or establish an injury caused by an act of racketeering).

In 2002, Congress enacted the Sarbanes-Oxley Act (“SOA”) to address growing concerns about the reliability and accuracy of disclosures made by publicly-traded corporations.  DeGuelle v. Camilli, 664 F.3d 192 (7th Cir. 2011).  The SOA also added violation of 18 U.S.C. § 1513(e) as an act of racketeering upon which a RICO claim can be predicated. Section 1513(e) prohibits retaliation against any person who provides to a law enforcement officer any truthful information relating to the commission or possible commission of a federal offense.  As a result, if an employee is injured by reason of a pattern of racketeering that results in his or her retaliatory discharge in violation of section 1513(e), that discharge may now confer standing on the employee to bring a RICO conspiracy claim against the individuals who engaged in the retaliatory actions.  Id.

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