Source: https://www.law.cornell.edu/supct/html/98-1480.ZO.html
Timestamp: 2019-04-24 01:53:51+00:00

Document:
ROBERT A. BECK, II, PETITIONER v. RONALD M. PRUPIS et al.
The Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 19611968 (1994 ed. and Supp. IV), creates a civil cause of action for [a]ny person injured in his business or property by reason of a violation of section 1962. 18 U.S.C. § 1964(c) (1994 ed., Supp. IV). Subsection (d) of §1962 in turn provides that [i]t shall be unlawful for any person to conspire to violate any of the provisions of subsection (a), (b), or (c) of [§1962]. The question before us is whether a person injured by an overt act done in furtherance of a RICO conspiracy has a cause of action under §1964(c), even if the overt act is not an act of racketeering. We conclude that such a person does not have a cause of action under §1964(c).
Congress enacted RICO as Title IX of the Organized Crime Control Act of 1970, Pub. L. 91452, 84 Stat. 922, for the purpose of seek[ing] the eradication of organized crime in the United States, id., at 923. Congress found that organized crime in the United States [had become] a highly sophisticated, diversified, and widespread activity that annually drain[ed] billions of dollars from Americas economy by unlawful conduct and the illegal use of force, fraud, and corruption. Id., at 922. The result was to weaken the stability of the Nations economic system, harm innocent investors and competing organizations, interfere with free competition, seriously burden interstate and foreign commerce, threaten the domestic security, and undermine the general welfare of the Nation and its citizens. Id., at 923. Finding the existing sanctions and remedies available to the Government [to be] unnecessarily limited in scope and impact, Congress resolved to address the problem of organized crime by strengthening the legal tools in the evidence-gathering process, by establishing new penal prohibitions, and by providing enhanced sanctions and new remedies to deal with the unlawful activities of those engaged in organized crime. Ibid.
Petitioner, Robert A. Beck II, is a former president, CEO, director, and shareholder of Southeastern Insurance Group (SIG).3 Respondents, Ronald M. Prupis, Leonard Bellezza, William Paulus, Jr., Ernest S. Sabato, Harry Olstein, Frederick C. Mezey, and Joseph S. Littenberg, are former senior officers and directors of SIG. Until 1990, when it declared bankruptcy, SIG was a Florida insurance holding company with three operating subsidiaries, each of which was engaged in the business of writing surety bonds for construction contractors.
We granted certiorari, 526 U.S. 1158 (1999), to resolve a conflict among the Courts of Appeals on the question whether a person injured by an overt act in furtherance of a conspiracy may assert a civil RICO conspiracy claim under §1964(c) for a violation of §1962(d) even if the overt act does not constitute racketeering activity. The majority of the Circuits to consider this question have answered it in the negative. See, e.g., Bowman v. Western Auto Supply Co., 985 F.2d 383, 388 (CA8), cert. denied, 508 U.S. 957 (1993); Miranda v. Ponce Fed. Bank, 948 F.2d 41, 48 (CA1 1991); Reddy v. Litton Indus., Inc., 912 F.2d 291, 294295 (CA9 1990), cert. denied, 502 U.S. 921 (1991); Hecht v. Commerce Clearing House, Inc., 897 F.2d 21, 25 (CA2 1990). Other Circuits have allowed RICO conspiracy claims where the overt act wasas in the instant casemerely the termination of employment, and was not, therefore, racketeering activity. See, e.g., Khurana v. Innovative Health Care Systems, Inc., 130 F.3d 143, 153154 (CA5 1997), vacated sub nom. Teel v. Khurana, 525 U.S. 979 (1998); Schiffels v. Kemper Financial Services, Inc., 978 F.2d 344, 348349 (CA7 1992); Shearin v. E. F. Hutton Group, Inc., 885 F.2d 1162, 11681169 (CA3 1989).
presumably knows and adopts the cluster of ideas that were attached to each borrowed word in the body of learning from which it was taken and the meaning its use will convey to the judicial mind unless otherwise instructed. In such case, absence of contrary direction may be taken as satisfaction with widely accepted definitions, not as a departure from them. Morissette v. United States, 342 U.S. 246, 263 (1952).
By the time of RICOs enactment in 1970, it was widely accepted that a plaintiff could bring suit for civil conspiracy only if he had been injured by an act that was itself tortious. See, e.g., 4 Restatement (Second) of Torts §876, Comment b (1977) (The mere common plan, design or even express agreement is not enough for liability in itself, and there must be acts of a tortious character in carrying it into execution); W. Prosser, Law of Torts §46, p. 293 (4th ed. 1971) (It is only where means are employed, or purposes are accomplished, which are themselves tortious, that the conspirators who have not acted but have promoted the act will be held liable (footnotes omitted)); Satin v. Satin, 69 App. Div. 2d 761, 762, 414 N. Y. S. 2d 570, (1979) (Memorandum Decision) (There is no tort of civil conspiracy in and of itself. There must first be pleaded specific wrongful acts which might constitute an independent tort); Cohen v. Bowdoin, 288 A. 2d 106, 110 (Me. 1972) ( [C]onspiracy fails as the basis for the imposition of civil liability absent the actual commission of some independently recognized tort; and when such separate tort has been committed, it is that tort, and not the fact of combination, which is the foundation of the civil liability); Earp v. Detroit, 16 Mich. App. 271, 275, 167 N. W. 2d 841, 845 (1969) (Recovery may be had from parties on the theory of concerted action as long as the elements of the separate and actionable tort are properly proved); Mills v. Hansell, 378 F.2d 53, (CA5 1967) (per curiam) (affirming dismissal of conspiracy to defraud claim because no defendant committed an actionable tort); J. & C. Ornamental Iron Co. v. Watkins, 114 Ga. App. 688, 691, 152 S. E. 2d 613, 615 (1966) ([The plaintiff] must allege all the elements of a cause of action for the tort the same as would be required if there were no allegation of a conspiracy); Lesperance v. North American Aviation, Inc., 217 Cal. App. 2d 336, 345 31 Cal. Rptr. 873, 878 (1963) ([C]onspiracy cannot be made the subject of a civil action unless something is done which without the conspiracy would give a right of action (internal quotation marks omitted)); Middlesex Concrete Products & Excavating Corp. v. Carteret Indus. Assn., 37 N. J. 507, 516, 181 A. 2d 774, 779 (1962) ([A] conspiracy cannot be made the subject of a civil action unless something has been done which, absent the conspiracy, would give a right of action); Chapman v. Pollock, 148 F. Supp. 769, 772 (WD Mo. 1957) (holding that a plaintiff who charged the defendants with conspiring to perpetrate an unlawful purpose could not recover because the defendants committed no unlawful act); Olmsted, Inc., v. Maryland Casualty Co., 218 Iowa 997, 998, 253 N. W. 804 (1934) ([A] conspiracy cannot be the subject of a civil action unless something is done pursuant to it which, without the conspiracy, would give a right of action); Adler v. Fenton, 24 How. 407, 410 (1861) ([T]he act must be tortious, and there must be consequent damage).
by reason of  a conspir[acy], it meant to adopt these well-established common-law civil conspiracy principles.
Petitioner challenges this view of the statute under the longstanding canon of statutory construction that terms in a statute should not be construed so as to render any provision of that statute meaningless or superfluous. He asserts that under our view of the statute, any person who had a claim for a violation of §1962(d) would necessarily have a claim for a violation of §1962(a), (b), or (c). However, contrary to petitioners assertions, our interpretation of §1962(d) does not render it mere surplusage. Under our interpretation, a plaintiff could, through a §1964(c) suit for a violation of §1962(d), sue co-conspirators who might not themselves have violated one of the substantive provisions of §1962.
We conclude, therefore, that a person may not bring suit under §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.
1. RICO also authorizes the Government to bring civil actions to prevent and restrain violations of §1962. 18 U.S.C. § 1964(a) and (b).
3. On review of the Court of Appeals affirmance of summary judgment for respondents, we accept as true the evidence presented by petitioner. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).
4. Petitioners lawsuit was originally brought as a cross-claim in a shareholders derivative suit filed against SIG officers and directors, including petitioner, in the United States District Court for the District of New Jersey. The New Jersey District Court severed petitioners claims and transferred them to the Southern District of Florida.
5. Although petitioner alleged violations of §§1962(a), (b), and (c), the Court of Appeals concluded that he had presented no evidence of violations of subsections (a) and (b). It therefore treated each of petitioners substantive RICO claims as alleging a violation of §1962(c). 162 F.3d, at 1095, n. 8. The court held that petitioner did not present evidence regarding elements of his §1962(c) claims and therefore affirmed the District Courts order granting summary judgment for respondents with respect to those claims. Id., at 10951098. Petitioner does not challenge the Court of Appeals conclusion with respect to his claims under §§1962(a)(c).
6. Petitioner suggests that we should look to criminal, rather than civil, common-law principles to interpret the statute. We have turned to the common law of criminal conspiracy to define what constitutes a violation of §1962(d), see Salinas v. United States, 522 U.S. 52, 6365 (1997), a mere violation being all that is necessary for criminal liability. This case, however, does not present simply the question of what constitutes a violation of §1962(d), but rather the meaning of a civil cause of action for private injury by reason of such a violation. In other words, our task is to interpret §§1964(c) and 1962(d) in conjunction, rather than §1962(d) standing alone. The obvious source in the common law for the combined meaning of these provisions is the law of civil conspiracy.
. Since liability for civil conspiracy depends on performance of some underlying tortious act, the conspiracy is not independently actionable; rather, it is a means for establishing vicarious liability for the underlying tort).
8. We disagree, moreover, with Justice Stevens interpretation of the grounds for decision in some of the cases we have cited. For example, Justice Stevens reads Mills v. Hansell, 378 F.2d 53 (CA5 1967) (per curiam), and Chapman v. Pollock, 148 F. Supp. 769, 772 (WD Mo. 1957), to deny recovery for conspiracy because the defendants had not entered into an unlawful agreement. See post, at 3. We think the opinions, and the language cited from these opinions by Justice Stevens, make clear that recovery was denied because the defendants had committed no actionable tort, regardless of whether they agreed to commit any such act. See ibid. Likewise, Justice Stevens reads J. & C. Ornamental Iron Co. v. Watkins, 114 Ga. App. 688, 691, 152 S. E. 2d 613, 615 (1966), to deny recovery because the plaintiff had suffered no injury. However, in that case, the plaintiffs conspiracy claim was predicated on several alleged torts including fraud, trespass, and malicious interference. Ibid. While the court held that the plaintiff could not recover for conspiracy to maliciously interfere because he had suffered no injury, the plaintiffs remaining conspiracy allegations were insufficient because the plaintiff did not allege all the elements of a cause of action for the tort the same as would be required if there were no allegation of a conspiracy. Ibid. Further, Justice Stevens chides us for citing cases in which the court allowed recovery. But in two of these cases the court explicitly grounded its decision on the fact that the plaintiff had identified an actionable independent tort on which the conspiracy claim could be based. See Cohen v. Bowdoin, 288 A. 2d 106, 110 (Me. 1972) ([I]f [the plaintiffs conspiracy claim] is to be upheld as stating a claim upon which relief can be granted, it must be on the ground that the complaint sufficiently alleges the actual commission of the separate and independent tort of defamation against the plaintiff); Middlesex Concrete Products & Excavating Corp. v. Carteret Indus. Assn., 37 N. J. 507, 516, 181 A. 2d 774, 779 (1962) (holding that the plaintiffs stated a claim for conspiracy because they alleged an actionable tort). In short, we think that there is ample evidence of the common-law rule we have cited.
9. For example, most courts of appeals have adopted the so-called investment injury rule, which requires that a plaintiff suing for a violation of §1962(a) allege injury from the defendants use or invest[ment] of income derived from racketeering activity, see §1962(a). See, e.g., Crowe v. Henry, 43 F.3d 198, 205 (CA5 1995); Vemco, Inc. v. Camardella, 23 F.3d 129, 132 (CA6) (collecting cases), cert. denied, 513 U.S. 1017 (1994). Although we express no view on this issue, arguably a plaintiff suing for a violation of §1962(d) based on an agreement to violate §1962(a) is required to allege injury from the use or invest[ment] of illicit proceeds.
10. Respondents argue that a §1962(d) claim must be predicated on an actionable violation of §§1962(a)(c). However, the merit of this view is a different (albeit related) issue from the one on which we granted certiorari, namely, whether a plaintiff can bring a §1962(d) claim for injury flowing from an overt act that is not an act of racketeering. Therefore, contrary to Justice Stevens suggestion, see post, at 56, we do not resolve whether a plaintiff suing under §1964(c) for a RICO conspiracy must allege an actionable violation under §§1962(a)(c), or whether it is sufficient for the plaintiff to allege an agreement to complete a substantive violation and the commission of at least one act of racketeering that caused him injury.

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