RICO Lawyer & Attorney : Thomas Walker : Cosho Humphrey Law Firm : RICO Act, Federal and State Racketeering Litigation, Boise Idaho

The White Collar Crime Prof Blog reported yesterday on an interesting issue presented in the Chronicle of Higher Education, Harvard Law Professor Takes New Tack Against RIAA (citing Jaikumar Vijayan, Computer World, Harvard professor offers new challenge to RIAA antipiracy campaign -Nesson claims Digital Theft Act, on which RIAA lawsuits are based, is unconstitutional) on whether the Digital Theft Act as used in a civil lawsuit is improper because the statute is limited to criminal matters.

Years back the issue would not have arisen as the overlap between criminal and third-party civil statutes did not exist.  With the Racketeer Influenced & Corrupt Organization Act (RICO) in 1970 we have seen statutes that allow for both criminal and civil enforcement, with the civil enforcement being extended beyond a government agency.  The rationale for these civil actions being allowed is that DOJ can't do it alone and allowing third-party civil actions can assist with enforcement. This was appealing with RICO because its initial focus was organized crime.  But RICO was interpreted broadly and went well beyond its roots and with it went the third-party civil actions. DOJ had and continues to have guidelines that restrict application of the statutes by providing oversight on prosecutorial discretion.  There are, however, no guidelines on the civil side.  This caused Congress to place additional limits on the civil side of RICO as seen in 18 U.S.C. 1964(c).

Other criminal statutes have seen attempts to be used in civil matters, such as the Foreign Corrupt Practices Act.  In Lamb v. Phillip Morris, Inc., 915 F.2d 1024 (6th Cir. 1024), the court did not allow the civil action. (See also Lewis v. Spock, 612 F. Supp. 1316 (N.D. Cal. 1985)).  Interestingly, one finds civil RICO actions that use the FCPA.

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If you’ve read my previous few posts, you may think that I hold a generally negative opinion of civil RICO. Not true! Although I am cautious and meticulous during pre-litigation investigation, once we decide to “pull the trigger” and file a case, my litigation team is relentless in pursuing it. By the time we file the complaint, we have decided that the defendant deserves to be “pulled through the knothole.” We are aggressive because we can be – we have done our homework and we know we have a good case. We have the forensic proof in hand and supported by at least one expert’s report and affidavit. This approach often overwhelms the unsuspecting defendant and his unprepared counsel.

On the other hand, if we’re defending, we undertake a thorough investigation of our own as soon as the defendant retains us.  Because of the complexity of defending civil RICO claims, most experienced lawyers require a large retainer to support an early concentration of efforts, including engaging one or more experts. Since the linchpin of a RICO claim is damage, most cases require us to hire a forensic accountant or certified fraud examiner right out of the starting blocks. From day one, we commit to a tenacious discovery effort. Delay in launching comprehensive discovery is not an option. Work must commence immediately to marshal the facts and law necessary to move for dismissal of the case at the earliest possible time. The defendant’s reputation is at stake and, as his counsel we must make every effort get the RICO claims dismissed as soon as possible. Then, we can concentrate on defending against the other claims, if any.  If our motion to dismiss is not granted, then our efforts shift to eliminating the RICO claims on summary judgment. Sometimes, we file a motion to dismiss for failure to state a claim and a motion for summary judgment at the same time. This gives the judge an opportunity to learn a lot about the facts and applicable defenses very early in the case.

Of course, while we are working our defense we expect that a well-prepared plaintiff’s lawyer will already have his opposition to our motion to dismiss and motion for summary judgment ready to go.

RICO lawsuits are demanding, exciting, and exhausting for both sides. Lawyers and their clients engaged in these cases better be prepared for the sting of battle – they better “. . . love the smell of napalm in the morning. . . .” ala Robert Duvall, Lt. Col. Bill Kilgore, in Apocalypse Now --

Kilgore: Smell that? You smell that?
Lance: What?
Kilgore: Napalm, son. Nothing in the world smells like that.
[kneels]
Kilgore: I love the smell of napalm in the morning.

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