RACKETEERING

Both the state and federal governments have legislation outlawing racketeering activity.  These laws are referred to as RICO statutes.  Racketeering is commonly thought of as a criminal offense, which it is, but the law also authorizes civil recovery for those injured by racketeering activity.  The purpose of the federal RICO statute is “the elimination of the infiltration of organized crime and racketeering into legitimate organizations operating in interstate commerce.” S.Rep. No. 617, 91st Cong., 1st Sess. 76 (1969). However, the statute is sufficiently broad to encompass illegal activities relating to any enterprise affecting interstate or foreign commerce.  Congress intented in § 1962(c) to target a specific variety of criminal activity: “the exploitation and appropriation of legitimate businesses by corrupt individuals.” United States v. Goldin Industries, Inc., 219 F.3d 1268, 1270 (11th Cir. 2000).

There are substantial similarities between the elements necessary to prove civil and criminal RICO violations.  But, there are differences.   Those differences are of type that distinguish most civil cases from criminal cases such as standing to sue, causation, injury or damages, pleading rules, venue, and jurisdiction.  To prove a criminal RICO case, the government does not have to prove a direct versus an indirect injury, the success of the crime, or damages.  To obtain civil relief, those are important elements.  At its core, racketeering is a criminal offense that requires proof of criminal activity, but it can be pursued civilly.

Both civil and criminal RICO actions require proof of a person or group carrying on a pattern of racketeering activity through an enterprise.  The distinction between the RICO person (the one who commits the wrongdoing) and the RICO enterprise is necessary because the enterprise itself can be a passive instrument or victim of the racketeering activity.  The enterprise is not the pattern of racketeering activity; it is an entity separate and apart from the pattern of activity in which it engages. United States v. Bledsoe, 674 F.2d 647, 663-64 (8th Cir. 1982), citing, United States v. Turkette, 101 S.Ct. 2524, 2528-29 (1981).  The enterprise and the conspiracy to act illegally through it are distinct.   The existence of an enterprise at all times remains a separate entity which must be proved.  Id.  The term enterprise must signify an association that is substantially different from the acts which form the pattern of racketeering activity.  Id.  RICO’s severe penalties are limited to enterprises consisting of more than simple conspiracies to perpetrate the predicate acts of racketeering.

The participation in the enterprise “through a pattern of racketeering activity” requires proff of the commission of certain federal or state crimes, usually called predicate acts.  The predicate acts must be related to the enterprise charged, and the predicate acts formed a pattern.  United States v. Starrett, 55 F.3d 1525, 1542 (11th Cir. 1995). Circuits that have explored this relationship requirement have held it may be satisfied by showing either that the defendant was enabled to commit the predicate offenses “solely by virtue of his position in the enterprise” or that the predicate offenses are related to the activities of the enterprise. Id.  For the second component, that the predicate acts must actually form a pattern, the predicate acts must be related to each other and have continuity. Starrett, 55 F.3d at 1543, citing, Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 n. 14 (1985); Jones v. Childers, 18 F.3d 899, 911 (11th Cir.1994); Cox v. Administrator U.S. Steel & Carnegie, 17 F.3d 1386, 1397 (11th Cir.), modified on other grounds, 30 F.3d 1347 (11th Cir.1994); United States v. Church, 955 F.2d 688, 693-94 (11th Cir. 1992).  RICO is not applied to isolated or sporadic criminal acts.

State RICO statutes can broader than their federal counterpart and may eliminate some elements required by the federal statute.  There may also be distinctions in the type of predicate acts that can form the pattern of racketeering activity.  Equitable relief is also usually available at the state level.  The Florida RICO statute closely tracks the federal model but affords the courts injunctive and other powers affecting the ongoing operations of an enterprise.  The Florida Civil Remedies Act includes the right to treble a damages upon proof of a violation of the substantive provisions of the Act by clear and convincing evidence.  In Florida, the State may also pursue a civil action (and civil forfeiture) for RICO violations.   

Representative Case

United States of America v. Organized Crime Crew, United States District Court, Middle District of Florida – Trombley & Hanes, P.A. represented an individual charged with racketeering for his participation in organized crime. The Defendant entered into a confidential resolution with the government.

State of Florida v. Individual and Federal Civil case in United States District Court, Middle District of Florida – Trombley & Hanes, P.A. lawyers represented a former President of Barnett Bank in relation to alleged fraudulent financial transactions conducted by the bank.  The matter was tried in State Court and in Federal Court in the Middle District of Florida.  Trombley & Hanes, P.A. was successful in obtaining a dismissal of the federal case in the Middle District of Florida, Tampa Division and also a favorable dismissal of the case against the President of Barnett Bank in the State Court proceedings.