Opinion ID: 621801
Heading Depth: 2
Heading Rank: 2

Heading: The RICO Pattern Instruction

Text: Chris Cain, David Cain, and Jamie Soha collectively argue that the district court erred in failing to instruct the jury that, in order to establish a pattern of racketeering for the purposes of securing a RICO conviction, the government was required to show that the predicate acts were related to one another and threatened continued criminal activity. We agree that the district court erred in failing to give the required relatedness and continuity instructions but conclude that the issue was forfeited due to the defendants' failure to object below. Although the error was not so prejudicial with regard to David Cain and Jamie Soha as to allow us to notice it under plain error review, we are of the view that the predicate acts proven with respect to Chris Cain are sufficiently disconnected to warrant reversal of his RICO convictions. The substantive RICO provision under which the defendants were convicted makes it unlawful for any person employed by or associated with any enterprise. . . to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity. 18 U.S.C. § 1962(c). Section 1962(d), in turn, makes it unlawful for any person to conspire to violate the substantive provisions of RICO. To satisfy the pattern of racketeering activity requirement, the statute requires at least two acts of racketeering activity . . . the last of which occurred within ten years (excluding any period of imprisonment) after the commission of a prior act of racketeering activity. 18 U.S.C. § 1961(5). Following Supreme Court precedent, however, we have held that the commission of two racketeering acts in furtherance of the RICO enterprise is not alone sufficient to establish a RICO pattern. See United States v. Indelicato, 865 F.2d 1370, 1376 (2d Cir.1989) (en banc), citing Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 497 n. 14, 105 S.Ct. 3275, 87 L.Ed.2d 346 (1985). Rather, a RICO pattern may not be established without some showing that the racketeering acts are interrelated and that there is continuity or a threat of continuity. Indelicato, 865 F.2d at 1381. Our subsequent decisions have labeled the requirement that the predicate acts be related to one another horizontal relatedness and the requirement they have a nexus to the enterprise vertical relatedness. See United States v. Burden, 600 F.3d 204, 216 (2d Cir.2010). The jury charge in this case failed to ensure that the horizontal relatedness and continuity requirements were met. The court instructed the jury that in order to satisfy RICO's pattern requirement, the government need only prove that the defendant committed at least two of [the charged] racketeering acts within 10 years of each other. That was error, as our decision in Indelicato makes clear. Moreover, because a conspiracy charge under Section 1962(d) requires proof that the conspirators reached a meeting of the minds as to the operation of the affairs of the enterprise through a pattern of racketeering conduct,  United States v. Basciano, 599 F.3d 184, 199 (2d Cir.2010) (emphasis added), the erroneous pattern instruction infected the jury's deliberations with regard to the conspiracy count as well. The government suggests, however, that the error was harmless in light of the jury's finding that the predicate acts had a nexus to the charged enterprise (an issue on which the jury was properly instructed). It is true that, in the context of sufficiency-of-the-evidence review, we have held that the requirements of horizontal relatedness can be established by linking each predicate act to the enterprise, although the same or similar proof may also establish vertical relatedness. United States v. Daidone, 471 F.3d 371, 375 (2d Cir.2006). But that analysis presumes a properly instructed jury whose attention has been called to the distinct nature of the vertical and horizontal relatedness requirements. As the Supreme Court has noted in discussing the relationship between the pattern requirement and RICO's enterprise element, while the proof used to establish these separate elements may in particular cases coalesce, proof of one does not necessarily establish the other. United States v. Turkette, 452 U.S. 576, 583, 101 S.Ct. 2524, 69 L.Ed.2d 246 (1981). Given the possibility that, if properly instructed, the jury in this case might have found that the proven predicates were not in fact interrelated, we cannot say that the district court's error was necessarily harmless. Indeed, in United States v. Long, faced with a case in which the district court had likewise failed to instruct the jury with regard to relatedness and continuity, we rejected precisely the argument that the government makes here, noting that [t]he erroneous RICO pattern instruction prevented the jury from validly determining whether the requisite pattern existed. 917 F.2d 691, 698 (2d Cir.1990). The government next maintains, however, that even if the defective pattern instruction was not harmless, the defendants forfeited their right to challenge it on appeal by failing to object adequately during trial. We agree that the objection was not adequately preserved. Under Federal Rule of Criminal Procedure 30(d), [a] party who objects to any portion of the instructions or to a failure to give a requested instruction must inform the court of the specific objection and the grounds for the objection before the jury retires to deliberate, and [f]ailure to object in accordance with [the] rule precludes appellate review, except where the plain error standard of Rule 52(b) is satisfied. Fed.R.Crim.P. 30(d). The defendants did not include an instruction like the one they now contend was required in any request to charge submitted in the district court before or during trial. Nor did any defendant object during the charge conference that the district court's proposed charge omitted the relatedness and continuity language, or advise the court that such language should be included in the charge. Moreover, after the court gave the charge, but before the jury retired to deliberate, when given a last opportunity to raise objections to the charge, no defendant objected to the definition of pattern that the judge had utilized in instructing the jury. In arguing that trial counsel adequately preserved a challenge to the defective pattern instruction, the defendants cite a colloquy between defense counsel and the trial court that took place after the charge had been delivered but before the jury had begun deliberations. Counsel for Jamie Soha objected to the court's instruction with regard to predicate act 9A of the indictmentthe extortion of Chuck Braceywhich was also charged as a substantive count in the indictment. As relevant here, the court instructed the jury, If you find that the defendant committed the Hobbs Act extortion charged in Count 5, then this 9th Racketeering Act is satisfied as to that defendant. Counsel for Jamie Soha, James Harrington, objected to this instruction on the ground that even though it may have been proven beyond a reasonable doubt that a defendant committed this particular act, that doesn't necessarily make it a RICO act, because it still has to be related to the RICO enterprise and it has to be related to the other. The following colloquy then took place: THE GOVERNMENT: Judge, I don't remember what you said or didn't say, but you instructed them on relatedness and those parts of RICO throughout the course of your instructions [6] and you had instructed them to read your instruction as a whole. I think you've done what the law requires. THE COURT: Yeah. Your objection is noted, Mr. Harrington. Okay. COUNSEL FOR C. CAIN: Your Honor, on behalf of Chris Cain, I'd like to join in that same objection that Your Honor's just ruled upon, but so that the record notes it. Our concern, obviously, being that jury might figure that a predicate must be checked if the substantive count is proven and then from there go on to conclude that it's part of a RICO pattern. Counsel for David Cain later joined in the objection without elaborating on the point. These statements by defense counsel failed to direct the trial court's attention to the contention that is to be raised on appeal, as is required to satisfy the Rule 30 standard. See United States v. Civelli, 883 F.2d 191, 194 (2d Cir.1989). Plainly, counsels' objections were specifically targeted at the district court's instruction that a guilty finding with respect to count five would require the jury to conclude that the corresponding RICO predicate had been proven. Nothing in the colloquy suggests an objection to the district court's general instructions regarding the pattern element of a RICO offense. Certainly no one called the court's attention to the fact that it had omitted a key portion of the RICO charge. Indeed, defense counsel did not challenge the government's mistaken assertion that the court had properly instructed the jury on the relatedness requirement. Nor did the objection refer in any way to the continuity aspect of the pattern requirement. Accordingly, we conclude that the defendants failed to preserve the argument that they now raise on appeal. Having concluded that the issue was not properly presented below, we next consider whether the district court's omission of a proper pattern instruction nevertheless constitutes plain error with regard to each of the defendants. As the Supreme Court has interpreted Rule 52(b), in order for us to correct an error that was forfeited in the district court, we must conclude that there was in fact error, that it was plain, and that it affected the defendant's substantial rights. See United States v. Pescatore, 637 F.3d 128, 141-42 (2d Cir.2011), citing Johnson v. United States, 520 U.S. 461, 467, 117 S.Ct. 1544, 137 L.Ed.2d 718 (1997). Where these three conditions have been met, we may exercise our discretion to notice a forfeited error, but only if it seriously affects the fairness, integrity, or public reputation of judicial proceedings. Pescatore, 637 F.3d at 141 (internal quotation marks and brackets omitted). On the facts of this case, we have little trouble concluding that the district court's omission of a pattern instruction satisfies the first two prongs of plain error review. As discussed above, a RICO pattern may not be established without some showing that the racketeering acts are interrelated and that there is continuity or a threat of continuity. Indelicato, 865 F.2d at 1381. Failure to instruct the jury on the relatedness and continuity requirements of a RICO offense was thus undoubtedly error. Moreover, this rule is well established in this Circuit, as is evidenced by our en banc decision in Indelicato and numerous cases that have followed it. See, e.g., Long, 917 F.2d at 696-98; United States v. Alkins, 925 F.2d 541, 553 (2d Cir.1991); Ianniello v. United States, 10 F.3d 59, 62 (2d Cir. 1993). The substantial body of caselaw addressing this issue, as well as the fact that the government's proposed charge in this case included a proper pattern instruction, lead us to conclude that the district court's error in omitting a pattern instruction was clear or obvious, rather than subject to reasonable dispute, and therefore plain within the meaning of Rule 52(b). See United States v. Kaiser, 609 F.3d 556, 565 (2d Cir.2010), quoting United States v. Marcus, ___ U.S. ___, 130 S.Ct. 2159, 2164, 176 L.Ed.2d 1012 (2010) (internal quotation marks omitted). Whether the district court's error affected the defendants' substantial rights, however, is a closer question. As the Supreme Court has recently reminded us, [i]n the ordinary case, to meet this standard an error must be prejudicial, which means that there must be a reasonable probability that the error affected the outcome of the trial. Marcus, 130 S.Ct. at 2164 (internal quotation marks omitted). We can discern no such possibility with respect to the RICO convictions of David Cain and Jamie Soha. The core of the government's RICO case was the charge that David Cain, with the assistance of various associates including Jamie Soha, orchestrated a campaign of extreme violence against rivals of his tree service and logging business in order to intimidate them into leaving the market. Consistent with this theory, predicate acts seven, nine, and ten of the indictment charged David Cain and Soha with the extortion of competitors Keith Kent, Charles Bracey, and Dan Gollus. As discussed above, the district court's extortion charge required the jury to find, inter alia, that the defendant wrongfully obtained the property of another or attempted to do so . . . with the victim's consent, but that this consent was compelled by the wrongful use or threatened use of force, violence or fear. Having found that the extortion predicates were proved with respect to both David Cain and Jamie Soha, a properly instructed jury could not have failed to conclude that they were interrelated. Whether the property in question was specific tree-service jobs or simply the victims' share of the market, the evidence overwhelmingly demonstrated that the same objective motivated each act of extortionto increase the market share of David's Tree Service and to enrich David Cain and his associates. In the words of one witness, He wanted to be the biggest and best tree service in the area. It is equally undeniable that the Kent, Bracey and Gollus extortions satisfy the continuity requirement. Continuity is both a closed- and open-ended concept, referring either to a closed period of repeated conduct, or to past conduct that by its nature projects into the future with a threat of repetition. H.J. Inc. v. Northwestern Bell Tel. Co., 492 U.S. 229, 241, 109 S.Ct. 2893, 106 L.Ed.2d 195 (1989) (internal quotation marks omitted). Both notions of continuity are satisfied here. The extortions occurred over more than two years, which we have held is a sufficient period to support a finding of closed-ended continuity. See DeFalco v. Bernas, 244 F.3d 286, 321 (2d Cir.2001). Moreover, we have recognized that where the enterprise is an entity whose business is racketeering activity, an act performed in furtherance of that business automatically carries with it the threat of continued racketeering activity. Burden, 600 F.3d at 219 (internal quotation marks omitted). Nothing in the evidence remotely suggested that the extortions of Kent, Bracey and Gollus were aimed uniquely at them. Rather, the evidence overwhelmingly demonstrated that the purpose of the extortions was to secure David Cain's dominance over the tree service business in Niagara Countya goal that plainly posed a threat of future similar acts as needed to eliminate additional existing competitors or future entrants into the market. Because it was the business of the Cain gang to advance its members' interests through the use of violent criminal means, the extortions exhibited open-ended continuity. Having established that, if properly instructed, the jury in this case would necessarily have concluded that the relatedness and continuity requirements were proven with respect to predicate acts seven, nine and ten, we need not inquire further to conclude that the RICO convictions of both David Cain and Jamie Soha must be affirmed. The last of these predicatesthe extortion of Dan Gollusoccurred in March of 2003, and was therefore well within RICO's five-year statute of limitations when the defendants were indicted on these charges in May 2006. See 18 U.S.C. § 3282 (1988); United States v. Persico, 832 F.2d 705, 714 (2d Cir.1987). The next most recent predicatethe extortion of Chuck Braceytook place in February 2002 and thus satisfies RICO's ten-year temporal relatedness requirement. See 18 U.S.C. § 1961(5). The extortion predicates alone are thus sufficient to support David Cain's conviction under 18 U.S.C. § 1962(c) and (d). Furthermore, although the verdict form did not require the jury to make a finding as to the particular racketeering predicates that were foreseeable to Soha as part of the racketeering conspiracy charge, given that the jury found him guilty on the underlying extortion counts, we have no doubt that, if the question had been posed, the jury would have identified these three acts as part of the basis for its racketeering verdict. Accordingly, because it is not reasonably probable that a properly instructed jury would have returned a different verdict with regard to David Cain and Soha, we affirm their racketeering convictions. [7] We cannot conclude the same, however, with regard to Chris Cain. Unlike the other two defendants, Chris Cain was not charged in the three tree-service extortions that made up the core of the RICO case against his brother. Indeed, the evidence connecting Chris Cain's unlawful activities to the criminal association charged in the indictment was remarkably thin. The only predicate act that the jury found to have been proved with respect to both Chris Cain and David Cain (the alleged leader of the enterprise) was the November 1994 arson of a vehicle belonging to Niagara County Sheriff's Deputy Timothy Callaghan. But the government has acknowledged on appeal that the evidence was insufficient to support the jury's finding with respect to that predicate. Because the court properly instructed the jury as to the nexus requirement and returned a guilty verdict against Chris Cain on the substantive RICO and conspiracy charges, we must assume that it found some meaningful connection between the defendant's illegal acts and the affairs of the enterprise. As discussed above, we recognize that a jury may properly infer continuity and relatedness where the predicates can be attributed to a defendant operating as part of a long-term association that exists for criminal purposes. See H.J., 492 U.S. at 242-43, 109 S.Ct. 2893; see also Daidone, 471 F.3d at 375. But a jury would be equally entitled not to draw such an inference. In this case, the racketeering acts that the jury found to have been proved as to Chris Cain are not so clearly linked to each other or to the enterprise itself that we could confidently conclude that a rational jury, properly instructed, would necessarily or even likely find that they constitute a pattern of racketeering activity. The government defends the jury's verdict with regard to only four predicate acts that involved Chris Cain: a conspiracy to grow and distribute marijuana in the summer of 2003, the September 2003 arson of Georgia Korosecz's residence at the instigation of her ex-boyfriend, arson and insurance fraud in connection with an August 2003 fire that destroyed a rental property owned by the Cains' parents, and a home invasion robbery of Marjorie Carter in the fall of 2003. As found by the jury, none of these offenses involved David Cain, [8] David's Tree Service or the large cast of characters who participated in the core extortion activities. [9] Nor is there any readily apparent connection among the crimes. Although two of the crimes involved arson, one involved insurance fraud related to the Cain family, while Chris Cain was hired to carry out the other by Randy Maedl, a stranger to the enterprise, whose only objective was to pressure Korosecz into cohabitating with him. The marijuana business was short-lived and had little in common with any of the other crimes attributed to the enterprise, and the robbery exhibited many indicia of an opportunistic act. Given the minimal overlap in players and motives, the link between Chris Cain's criminal activities and the enterprise headed by David Cain was tenuous at best. Certainly the relationship was not so strong that the jury would have been required to infer that the racketeering acts in which Chris Cain was named were interrelated to each other or to the other predicate acts associated with the enterprise and constituted (or threatened) continuing criminal activity. Aside from whatever minimal connection they might have to the overarching enterprise, the four proven predicates differ significantly with regard to the type of activity at issue and the defendant's putative motives; nothing suggests that a jury, properly focused on the requirement by a correct instruction, would have been likely to find beyond a reasonable doubt that they were interrelated. Nor is it a foregone conclusion that they satisfy the continuity requirement. The Supreme Court has recognized that a threat of continuing criminal activity may be proven even when the number of predicate acts is small and they occur close together in time. See H.J., 492 U.S. at 242, 109 S.Ct. 2893. But in this case, there is a reasonable probability that a jury considering the matter would conclude that the four predicate acts attributed to Chris Cain, which occurred over a period of just a few months, were neither temporally extensive enough nor sufficiently suggestive of future crime to support a finding of continuity. Chris Cain was therefore prejudiced by the district court's failure to instruct the jury as to RICO's pattern requirement. Moreover, we conclude that the district court's incomplete instruction seriously affects the fairness, integrity [and] public reputation of judicial proceedings as they pertain to Chris Cain and that, accordingly, we are warranted in exercising our discretion to notice it. Pescatore, 637 F.3d at 141 (internal quotation marks and brackets omitted). For the reasons that we have outlined, there is a reasonable likelihood that a properly instructed jury would conclude that the government has not proved beyond a reasonable doubt that Chris Cain's criminal conduct constitutes a pattern of racketeering activity. Thus, it may very well be that, absent the error, the jury would not have returned a guilty verdict on the substantive RICO count. Allowing this error to stand, in the face of a significant chance that the defendant was not guilty of the crime charged, would significantly affect the fairness and integrity of the proceeding. Chris Cain's conviction for conspiring to violate RICO must be reversed as well. A conspiracy conviction under Section 1962(d) requires proof, inter alia, that a defendant agreed with others (a) to conduct the affairs of an enterprise (b) through a pattern of racketeering. United States v. Basciano, 599 F.3d 184, 199 (2d Cir.2010). Although a conspirator charged with racketeering conspiracy need not commit or even agree to commit the predicate acts, he must intend to further an endeavor which, if completed, would satisfy all of the elements of a substantive [RICO] offense. Salinas v. United States, 522 U.S. 52, 65, 118 S.Ct. 469, 139 L.Ed.2d 352 (1997). Thus we have recognized that, in deciding whether a defendant is guilty of RICO conspiracy, the jury must consider the predicate acts charged against the defendant and his alleged coconspirators to determine whether the charged predicate acts were, or were intended to be, committed as part of that conspiracy. United States v. Yannotti, 541 F.3d 112, 129 n. 11 (2d Cir.2008). Because the verdict form in this case did not require the jury to identify the specific predicate acts that supported its verdict on the conspiracy charges, we cannot be certain of the basis of the jury's verdict convicting Chris Cain of conspiracy. Based on the evidence, the jury could conceivably have found that Chris Cain conspired with David Cain and Jamie Soha to manage the affairs of their gang through a pattern of activity that included the predicate acts that the jury found proven with respect to David Cain and Soha. The defective pattern instruction would have little bearing on such a finding since, as we have already discussed, the evidence establishing the relatedness and continuity of the core extortion counts was overwhelming. But a jury may convict a defendant of conspiracy even when the defendant does not know the full extent of the conspiracy. United States v. Sureff, 15 F.3d 225, 230 (2d Cir. 1994). Thus, the jury might also have convicted Chris Cain on the theory that he conspired with Paul Rutherford Jr. and others to manage the affairs of the Cain gang through a pattern of activity that included only the predicate acts with which he was himself chargedand, indeed, it is far more likely that the jury found that Chris Cain conspired to violate the RICO statute through his own acts than that he did so by agreeing to support activities of the enterprise in which he played no substantial part. For reasons that we have already articulated, the latter theory is compromised by the district court's failure to give a proper pattern instruction. Because of the risk that the jury convicted Chris Cain of RICO conspiracy on the basis of a legally flawed theory, we must reverse not only his substantive RICO conviction but his conviction on the conspiracy count as well.