Opinion ID: 187362
Heading Depth: 2
Heading Rank: 5

Heading: BATCo

Text: Defendant BATCo claims that the district court erred in imposing liability on the basis of its conduct outside the United States. Noting that the district court found that its activities and statements took place outside of the United States, Philip Morris, 449 F.Supp.2d at 873, BATCo claims that it enjoys immunity from RICO liability because the statute has no extraterritorial reach. We need not decide today whether RICO has true extraterritorial reachthat is, whether it could reach foreign conduct with no impact on the United Statesbecause the district court found BATCo liable on the theory that its conduct had substantial domestic effects. Id. Because conduct with substantial domestic effects implicates a state's legitimate interest in protecting its citizens within its borders, Congress's regulation of foreign conduct meeting this effects test is  not an extraterritorial assertion of jurisdiction. Laker Airways Ltd. v. Sabena, Belgian World Airlines, 731 F.2d 909, 923 (D.C.Cir.1984). Thus, when a statute is applied to conduct meeting the effects test, the presumption against extraterritoriality does not apply. See Envtl. Def. Fund, Inc. v. Massey, 986 F.2d 528, 531 (D.C.Cir.1993) (noting that the presumption [against extraterritoriality] is generally not applied where the failure to extend the scope of the statute to a foreign setting will result in adverse effects within the United States, citing Laker Airways ). BATCo argues that the effects test is inapplicable because the United States had no obligation to prove that Defendants' conduct had any effects whatsoever. Although BATCo attributes this to the fact that 18 U.S.C. § 1964(a) does not require the government to prove that it has been injured, we think it better explained by the fact that the mail and wire fraud statutes punish the scheme, not its success. Pasquantino v. United States, 544 U.S. 349, 371, 125 S.Ct. 1766, 161 L.Ed.2d 619 (2005). That said, BATCo's point has nothing to do with the case at hand. Here the district court found that BATCo's conduct had substantial direct effects on the United States. Philip Morris, 449 F.Supp.2d at 873. The fact that some other defendant might commit some other offense without effects in the United States hardly renders BATCo immune from liability for the domestic effects it did cause. Someone who fires a rifle from Canada into the United States and wounds his victim can plainly be convicted of attempted murder. See Laker Airways, 731 F.2d at 922 ([W]hen a malefactor in State A shoots a victim across the border in State B, State B can proscribe the harmful conduct.). This is so even though in general the government may prove attempted murder without establishing that the attempt had any effect whatsoever. Similarly, the fact that effects are not elements of mail and wire fraud offenses or associated RICO violations provides no immunity to those, like BATCo, whose fraud and racketeering has substantial and direct domestic effects. Thus, we need decide only whether the district court erred in applying the effects testwhich asks whether conduct has a substantial, direct, and foreseeable effect within the United States, see Consol. Gold Fields PLC v. Minorco, S.A., 871 F.2d 252, 261-62 (2d Cir.1989) (describing substantial effect as direct and foreseeable)to the facts of this case. We see no error. The district court found that as part of the overall scheme to defraud, BATCo conducted sensitive nicotine research for Brown & Williamson abroad and secretly shared the results with Brown & Williamson in the United States. Philip Morris, 449 F.Supp.2d at 298-304. It further found that BATCo, in concert with other Defendants, founded, funded, and actively participated in various international organizations, which Defendants themselves saw as instrumental to their efforts to perpetuate what the district court found to be their fraudulent scheme in the United States. See id. at 119-23. In one example, TI admitted that the back-wash from events and attacks affecting the industry in smaller countries comes back powerfully to the USA, id. at 140 (quotation marks omitted), and praised INFOTAB, an international organization of which BATCo was a founding member, id. at 132, for help[ing] the industry to unite in trying to combat the attacks, id. at 140 (quotation marks omitted). Notwithstanding BATCo's demands for a nearly unattainable level of specificity, these unchallenged findings, together with the findings of the tremendous domestic effects of the fraud scheme generally, see, e.g., id. at 209, 307-08, make clear that the district court committed no error in finding that BATCo's participation had substantial, direct, and foreseeable effects in the United States. Cf. Laker Airways, 731 F.2d at 925-26 (finding allegations that the anticompetitive elimination of a foreign airline increased domestic air fares adequate to support antitrust action without demanding further specificity).