Waste Management of Louisiana LLC v. River Birch Incorporated, __ F.3d __, 2019 WL 1550248 (5th Cir., Apr. 10, 2019)
The Court vacated the district court’s judgment dismissing a civil RICO claim on a summary judgment motion, and remanded this case for further proceedings.
Appellants challenge the district court’s order granting partial summary judgment in favor of Defendants River Birch, Inc., Albert Ward, Frederick Heebe and Highway 90, L.L.C (collectively referred as “River Birch”). Plaintiff Waste Management alleged that Defendants bribed former New Orleans Mayor Ray Nagin to shut down a landfill opened in the city in the aftermath of Hurricane Katrina. Plaintiff was the operator of the shuttered landfill, and Defendants owned and operated competing landfills. Plaintiff alleged that the closure of its Chef Menteur landfill caused it to lose business that accrued to the benefit of its competitor, the River Birch landfill.
On summary judgment, the district court concluded that the Rule 56 evidence presented no jury question regarding the essential causation element to Plaintiff’s civil action under RICO, 18 U.S.C. § 1962(c) and (d). Specifically, the district court, without considering whether Defendants’ $ 20,000 campaign contribution was a bribe, held that the summary judgment evidence failed to create a genuine issue of material fact to allow a jury to find that this payment was the but for and proximate cause of Nagin’s decision to shut down Plaintiff’s landfill at Chef Menteur Highway.
The Court found the evidence was sufficient for a jury to make positive findings on both Plaintiff’s claim that the $ 20,000 payment to Nagin (made through shell corporations) was a bribe and that the bribe was causally related to Nagin’s action in shuttering the Chef Menteur landfill.
The Court considered the following legal issues:
1. Was there sufficient evidence so that a jury could find $ 20,000 contribution by Defendants to Nagin was a bribe under Louisiana law and thus a “predicate act” under RICO?
The issue is whether the payment was made “with the intent to influence a public official’s conduct in relation to his position, employment, or duty.” The court discussed various facts and scenarios and determined that based on Mouton’s testimony [Mouton was a former commissioner for the Louisiana Department of Wildlife and Fisheries who plead guilty to receiving a bribe] Mouton played a large role in Defendants’ underlying scheme to shutter the Chef Menteur landfill. Because there was a scheme to shutter the Chef Menteur landfill, the evidence suggesting Defendants’ intent to bribe Mouton can be considered by the jury in determining Defendants’ motive and intent in connection with their contribution to Nagin’s campaign. There is also the additional fact that these contributions in the amount of $ 5,000 each were made not in Defendants’ names, but rather by four shell corporations. The Court concluded that It is critical in cases such as this that inferences from circumstantial evidence about intent and motives about which reasonable minds could differ be sorted out by the jury, and thus denied the motion for summary judgment.
2. Was there evidence to support a jury finding that there was a causal connection between Defendants’ $ 20,000 payment and Nagin’s ultimate decision to shut down the Chef Menteur landfill?
The Court discussed various issues and concluded that a reasonable jury could infer causation from Mayor Nagin’s disregard of the evidence that the Chef Menteur landfill was safe and badly needed in the City’s disaster cleanup.
Accordingly, for various reasons, the Court concluded that the record reflected genuine issues of material fact as to both whether the Defendants’ campaign contribution to Nagin was a bribe, and whether the payment was the but for and proximate cause of Nagin’s decision to close the Chef Menteur landfill. Thus, the Court held that Plaintiff has provided sufficient evidence to survive a summary judgment challenge in this case. [A dissenting Judge opined that there was inadequate evidence of causation to bring the case to a jury].
Ed Note: When civil RICOs involve predicate crimes such as bribery, courts often have more leeway to allow those cases to proceed. Bribery is at the heartland of civil litigation and criminal RICO prosecutions. Civil litigants who can plausibly allege felony bribery violations stand a strong chance of successfully litigating their case.