Magistrate Judge Cites to Dissent in Boyle v. United States to Find An Enterprise Not Adequately Alleged

Catano v. Capuano and Schivato, 2019 WL 3035752 (S.D. Fla., July 11, 2019)

Magistrate Judge Edwin Torres granted defendant’s motion for summary judgment dismissing civil RICO claims. The case involved the defendants engaging together to hide embezzled funds, with Mrs. Capuano making false representations to the probate court and further impeding the recovery of estate assets, continuously through the time of the filing of Plaintiff’s complaint.

Magistrate Torres makes two critical errors in his analysis.

1. Pattern of Racketeering Argument is Not Supported by Supreme Court in H.J. Inc.

First, although Mrs. Capuano and Mr. Schirato committed the predicate acts over the course of four years, the Judge found no closed ended continuity because this was viewed as a single scheme involving only one victim.*3. This is in direct contravention of H.J. Inc. which specifically held that multiple schemes are NOT necessary to satisfy closed-ended continuity.

2. Judge Relies on Dissenting Language in Boyle v. United States To Find No Enterprise Was Separately Alleged

The Judge rests his opinion on the dissent in Boyle v. United States, 556 U.S. 239 (2009). Citing to Boyle’s dissent, the Judge is correct in stating “there must be evidence “of the entity’s ‘separate’ existence and ‘ongoing organization.’ ”Id. *7, citing Boyle, 556 U.S. at 955 (quoting Turkette, 452 U.S. at 583). But, the Judge improperly cites the Boyle dissent for the proposition that separate existence “will often require “proof of an enterprise’s separate existence,” and “different evidence from that used to establish the pattern of predicate acts.” Id. *7, citing Boyle, 556 U.S. at 955 (emphasis added). The Judge cited to the Boyle dissent for the principles that “evidence needed to establish an enterprise’s separate existence may be provided via an organizational hierarchy, an internal discipline mechanism, regular meetings, or a practice of reinvesting proceeds to promote and expand the enterprise. See Boyle, 556 U.S. at 956, ftn. 7.

These statements were specifically repudiated by the majority in Boyle, which citing to Turkette, held —
This instruction properly conveyed the point we made in Turkette that proof of a pattern of racketeering activity may be sufficient in a particular case to permit a jury to infer the existence of an association-in-fact enterprise.
Id. at 951.

Thus, there is no requirement that there be “different evidence” to show the separate existence of an enterprise. As a result, the Judge’s reliance on the dissent in Boyle, whose ideas were specifically repudiated by the majority opinion, to hold an enterprise was not separately alleged, is wrong and error.

David J. Stander is an attorney who focuses his practice on civil RICO litigation.


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