Opinion ID: 526475
Heading Depth: 2
Heading Rank: 2

Heading: Distinguishing RICO Persons from the RICO Enterprise

Text: 42 Appellants argue that plaintiffs' pleadings do not adequately describe the enterprise and the persons participating in the enterprise. Only persons can be held liable for RICO violations; the enterprise itself is not liable. 18 U.S.C. § 1962(c). See, e.g., Yellow Bus Lines, Inc. v. Local Union 639, 839 F.2d 782 (D.C.Cir.), cert. denied, --- U.S. ----, 109 S.Ct. 309, 102 L.Ed.2d 328 (1988). The person and the enterprise must be separate and different entities. See, e.g., United States v. Feldman, 853 F.2d 648, 656 (9th Cir.1988), cert. denied, --- U.S. ----, 109 S.Ct. 1164, 103 L.Ed.2d 222 (1989). This distinction must be described in the pleadings. Bennett v. Berg, 685 F.2d 1053, 1061 (8th Cir.1982), cert. denied, 464 U.S. 1008, 104 S.Ct. 527, 78 L.Ed.2d 710 (1983). 43 The pleadings in this case satisfactorily describe and distinguish the persons and the enterprise. The statute defines an enterprise as any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity. 18 U.S.C. § 1961(4). We believe the pleadings adequately state that each of the five defendants was a person and together they formed a racketeering enterprise. An enterprise must be merely an ongoing organization, formal or informal. United States v. Turkette, 452 U.S. 576, 583, 101 S.Ct. 2524, 2528, 69 L.Ed.2d 246 (1981). In this case, Metropolitan, Palm Beach, Krypton, Levine and Feltner comprised such a group. See also Feldman, 853 F.2d at 655-56 (individuals and corporations can associate to create RICO enterprise). 44 Appellant contends that the enterprise alleged and proven was not sufficiently distinct from the person--in other words, because Feltner owned 100% of the corporations, they were the equivalent of his right arm, with whom he could not conspire. See United States v. Computer Sciences Corp., 689 F.2d 1181, 1190 (4th Cir.1982), cert. denied, 459 U.S. 1105, 103 S.Ct. 729, 74 L.Ed.2d 953 (1983). Such argument has no merit; the fact that Feltner owned 100% of the corporations' shares does not vitiate the fact that these corporations were separate legal entities. See Feldman, 853 F.2d at 656 (stating, [i]f one corporation possesses an existence separate from its incorporator, clearly a group of corporations formed by defendant is also distinct); United States v. Benny, 786 F.2d 1410 (9th Cir.), cert. denied, 479 U.S. 1017, 107 S.Ct. 668, 93 L.Ed.2d 720 (1986); McCullough v. Suter, 757 F.2d 142, 143-44 (7th Cir.1985). Clearly, the jury had ample basis to find that all defendants were collectively, the enterprise. 4 45