Opinion ID: 4468300
Heading Depth: 2
Heading Rank: 1

Heading: Closed‐ended Continuity

Text: Like the district court, we find that Grace has failed to allege closed‐ended continuity. As noted above, “[t]o satisfy closed‐ended continuity, the plaintiff must prove ‘a series of related predicates extending over a substantial period of time.’” Cofacredit, 187 F.3d at 242 (quoting H.J. Inc., 492 U.S. at 242). Since the 5 Supreme Court decided H.J. Inc., we have never found predicate acts spanning less than two years to be sufficient to constitute closed‐ended continuity. “[W]hile two years may be the minimum duration necessary to find closed‐ended continuity, the mere fact that predicate acts span two years is insufficient, without more, to support a finding of a closed‐ended pattern.” First Capital, 385 F.3d at 181. The court must also consider the number and variety of predicate acts, the presence or absence of multiple schemes, and the number of participants and victims. See Spool v. World Child Int’l Adoption Agency, 520 F.3d 178, 184 (2d Cir. 2008); First Capital, 385 F.3d at 181. Grace argues it has adequately alleged the requirements of closed‐ended continuity because “the acts took place for a period extending longer than two (2) years,” Plaintiff’s Amended Complaint (“AC”) ¶ 240, since the scheme allegedly lasted a total of twenty‐nine months. However, the scheme involved few victims – most generously Grace, its principal investor, and a handful of subcontractors who were left unpaid – and fewer perpetrators – just Festa, acting through his construction company, Falcon. At bottom, the RICO scheme alleged in the complaint had the limited goal of defrauding Grace. We therefore agree with the district court that such a scheme does not support a finding of closed‐ended 6 continuity. See First Capital, 385 F.3d at 182 (holding that predicate acts over two‐ and‐a‐half years did not constitute closed‐ended continuity because the complaint “alleged that [defendant] engaged in a single scheme to defraud two creditors by quickly moving his assets to his relatives and then concealing the existence of those assets during his bankruptcy proceeding”).