Opinion ID: 187183
Heading Depth: 2
Heading Rank: 4

Heading: RICO Jurisdiction

Text: In Count IV of their amended complaint, Eisenberg and FCIG allege that IFX violated the conspiracy section of RICO, 18 U.S.C. § 1962(d). Appellant's Br. 29 (citing Am. Comp. ¶¶ 47-59). They argue that under RICO the exercise of personal jurisdiction over IFX . . . was permissible, even in the absence of minimum contacts by IFX with the District, pursuant to RICO's nationwide service of process provision, 18 U.S.C. § 1965(d). Id. [13] But IFX counters that under RICO at least one defendant must have minimum contacts with the District before jurisdiction will be had over the other, nonresident defendant in the alleged RICO conspiracy. Appellee's Br. 27. 18 U.S.C. § 1965, entitled Venue and process, provides in relevant part: (a) Any civil action or proceeding under this chapter against any person may be instituted in the district court of the United States for any district in which such person resides, is found, has an agent, or transacts his affairs. (b) In any action under section 1964 of this chapter in any district court of the United States in which it is shown that the ends of justice require that other parties residing in any other district be brought before the court, the court may cause such parties to be summoned, and process for that purpose may be served in any judicial district of the United States by the marshal thereof. (c) In any civil or criminal action or proceeding instituted by the United States under this chapter in the district court of the United States for any judicial district, subpenas issued by such court to compel the attendance of witnesses may be served in any other judicial district. . . . (d) All other process in any action or proceeding under this chapter may be served on any person in any judicial district in which such person resides, is found, has an agent, or transacts his affairs. 18 U.S.C. § 1965 (emphases added). There are differing views among our own district judges as well as in our sister circuits regarding the proper interpretation of this language. Compare Republic of Panama v. BCCI Holdings (Luxembourg) S.A., 119 F.3d 935, 942-48 (11th Cir.1997) (finding nation-wide jurisdiction under section 1965(d)), and ESAB Group, Inc. v. Centricut, Inc., 126 F.3d 617, 626-27 (4th Cir.1997) (same), with PT United Can Co. Ltd. v. Crown Cork & Seal Co., 138 F.3d 65, 70 (2d Cir.1998) (section 1965(b) provides for nationwide service of process only where personal jurisdiction based on minimum contacts is established as to at least one defendant), and Butcher's Union Local No. 498 v. SDC Inv. Inc., 788 F.2d 535, 538 (9th Cir.1986) (under section 1965(b) the court must have personal jurisdiction over at least one of the participants in the alleged multidistrict conspiracy and the plaintiff must show that there is no other district in which a court will have personal jurisdiction over all of the alleged coconspirators); compare also Dooley v. United Techs. Corp., 786 F.Supp. 65, 70 (D.D.C.1992) (under section 1965(d) [m]inimum contacts with the forum state, as required under the traditional long-arm jurisdiction analysis, is not necessary), with World Wide Minerals Ltd. v. Republic of Kazakhstahn, 116 F.Supp.2d. 98, 108 (D.D.C.2000) (reject[ing] the notion that the federal RICO statute . . . provide[s] a basis for nation wide jurisdiction), remanded on other grounds, 296 F.3d 1154 (D.C.Cir.2002), cert. denied, 537 U.S. 1187, 123 S.Ct. 1250, 154 L.Ed.2d 1019 (2003), and AGS Int'l Servs. v. Newmont USA Ltd., 346 F.Supp.2d 64, 87 (D.D.C.2004) (same). Having considered the arguments of the parties, as well as the reasoning of our sister circuits on this question, we are persuaded to adopt the Second Circuit's reasoning. In PT United Can Co. Ltd. v. Crown Cork & Seal Co., 138 F.3d 65, 70 (2d Cir.1998), the Second Circuit explained that section 1965 must be read to give effect to all its sections in a way that renders a coherent whole. It stated: Reading all of the subsections of § 1965 together, the court finds that § 1965 does not provide for nationwide personal jurisdiction over every defendant in every civil RICO case, no matter where the defendant is found. First, § 1965(a) grants personal jurisdiction over an initial defendant in a civil RICO case to the district court for the district in which that person resides, has an agent, or transacts his or her affairs. In other words, a civil RICO action can only be brought in a district court where personal jurisdiction based on minimum contacts is established as to at least one defendant. Second, § 1965(b) provides for nationwide service and jurisdiction over other parties not residing in the district, who may be additional defendants of any kind, including co-defendants, third party defendants, or additional counter-claim defendants. This jurisdiction is not automatic but requires a showing that the ends of justice so require. This is an unsurprising limitation. There is no impediment to prosecution of a civil RICO action in a court foreign to some defendants if it is necessary, but the first preference, as set forth in § 1965(a), is to bring the action where suits are normally expected to be brought. Congress has expressed a preference in § 1965 to avoid, where possible, haling defendants into far flung fora. Next, § 1965(c) simply refers to service of subpoenas on witnesses. Thus, § 1965(d)'s reference to [a]ll other process, means process other than a summons of a defendant or subpoena of a witness. This interpretation, one which gives meaning to the word other by reading sequentially to understand other as meaning different from that already stated in subsections (a)(c), gives coherent effect to all sections of § 1965, and effectively provides for all eventualities without rendering any of the sections duplicative, without impeding RICO actions and without unnecessarily burdening parties. Id. at 71-72 (emphases added) (footnote omitted). [14] The Second Circuit endorsed the Ninth Circuit's holding in Butcher's Union, 788 F.2d at 538, that [f]or nationwide service to be imposed under section 1965(b), the court must have personal jurisdiction over at least one of the participants in the alleged multidistrict conspiracy and the plaintiff must show that there is no other district in which a court will have personal jurisdiction over all of the alleged co-conspirators. Id., as cited in PT United Can, 138 F.3d at 72 (adopting the natural reading given to § 1965(b) by the 9th Circuit in Butcher's Union ). In addition, the Tenth Circuit, the only circuit to have considered section 1965 since PT United Can, has also followed its interpretation, finding its reasoning persuasive and consistent with congressional intent. Cory v. Aztec Steel Bldg., Inc., 468 F.3d 1226, 1231 (10th Cir.2006). Because the district court is otherwise without personal jurisdiction over IFX, the sole defendant, it is also without RICO jurisdiction over IFX. For the foregoing reasons, the judgment of the district court is affirmed. So ordered.