Opinion ID: 2773473
Heading Depth: 2
Heading Rank: 1

Heading: RICO and proving “enterprise” in Ohio

Text: {¶ 3} The federal Racketeering Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. 1961 et seq., was the general model for Ohio’s own corrupt-activity statute. State v. Schlosser, 79 Ohio St.3d 329, 332, 681 N.E.2d 911 (1997). Ohio’s RICO statute, R.C. 2923.32(A)(1), provides: “No person employed by, or associated with, any enterprise shall conduct or participate in, directly or indirectly, the affairs of the enterprise through a pattern of corrupt 2 January Term, 2015 activity or the collection of an unlawful debt.” “Enterprise” is defined as including any individual, sole proprietorship, partnership, limited partnership, corporation, trust, union, government agency, or other legal entity, or any organization, association, or group of persons associated in fact although not a legal entity. “Enterprise” includes illicit as well as licit enterprises. R.C. 2923.31(C). {¶ 4} The state’s sole proposition of law states: In order to prove the existence of an “enterprise” to sustain a conviction for engaging in a pattern of corrupt activity in violation of R.C. 2923.32, the State is not required to prove that the organization is a structure separate and distinct from the pattern of activity in which it engages. {¶ 5} As we have stated, A RICO offense is dependent upon a defendant committing two or more predicate offenses listed in R.C. 2923.31(I). However, a RICO offense also requires a defendant to be “employed by, or associated with” an “enterprise” and to “conduct or participate in” an “enterprise through a pattern of corrupt activity.” R.C. 2923.32(A)(1). “Such pattern must include both a relationship and continuous activity, as well as proof of the existence of an enterprise. Thus, the conduct required to commit a RICO violation 3 SUPREME COURT OF OHIO is independent of the conduct required to commit [the underlying predicate offenses].” (Emphasis added.) State v. Dudas, 11th Dist. Lake Nos. 2008-L-109 and 2008-L-110, 2009-Ohio-1001, ¶ 46.  The intent of RICO is “ ‘to criminalize the pattern of criminal activity, not the underlying predicate acts.’ ” State v. Thomas, 3d Dist. Allen Nos. 1-11-25 and 1-11-26, 2012-Ohio5577, ¶ 61, quoting State v. Dodson, 12th Dist. Butler No. 200907-1147, 2011-Ohio-6222, ¶ 68. State v. Miranda, 138 Ohio St.3d 184, 2014-Ohio-451, 5 N.E.3d 603, ¶ 13. {¶ 6} In Miranda, we held that “a RICO offense does not merge with its predicate offenses for purposes of sentencing.” Id. at ¶ 3. Today, we conclude, in essence, that a “pattern of corrupt activity” does not merge with the concept of “enterprise.” {¶ 7} There is no question that a RICO conviction depends on the state being able to “prove both the existence of an ‘enterprise’ and the connected ‘pattern of racketeering activity.’ ” United States v. Turkette, 452 U.S. 576, 583, 101 S.Ct. 2524, 69 L.Ed.2d 246 (1981). See Miranda at ¶ 13. The question in this case is whether the same evidence can be used to prove both the existence of an enterprise and the associated pattern of corrupt activity. We conclude that it can and, therefore, also conclude that the state is not required to prove that the defendants were associated with an organization having an existence as an entity or structure separate and distinct from the pattern of activity in which it engages. {¶ 8} Nothing in R.C. Chapter 2923 implicitly or explicitly states that an enterprise and a pattern of corrupt activity must be proven with separate evidence. The definition of “enterprise” is remarkably open-ended. It includes “any individual, sole proprietorship, partnership, limited partnership, corporation, trust, union, government agency, or other legal entity, or any organization, association, 4 January Term, 2015 or group of persons associated in fact although not a legal entity.” R.C. 2923.31(C). See Boyle v. United States, 556 U.S. 938, 944, 129 S.Ct. 2237, 173 L.Ed.2d 1265 (2009) (similar enumeration in 18 U.S.C. 1961(4) of what constitutes an enterprise is “obviously broad”). {¶ 9} The statutory scheme does not indicate how the existence of an enterprise is to be proved, though various decisions of Ohio courts (Miranda and cases cited therein; State v. Welch, 3d Dist. Wyandot No. 16-06-02, 2006-Ohio6684), and the United States Supreme Court have provided insight. It is easy to prove the existence of certain enterprises, especially those with licit purposes: there is a document memorializing the creation of a partnership or corporation, etc. But here and in most cases involving a RICO-type conviction, the existence of an enterprise is more difficult to establish because the enterprise is entirely an “association in fact,” i.e., a de facto enterprise. Turkette, 452 U.S. at 583, 101 S.Ct. 2524, 69 L.Ed.2d 246. An association-in-fact enterprise has been defined as “a group of persons associated together for a common purpose of engaging in a course of conduct.” Id. See Boyle at 948 (“an association-in-fact enterprise is simply a continuing unit that functions with a common purpose). {¶ 10} The Supreme Court stated that “the existence of an enterprise is an element distinct from the pattern of racketeering activity and ‘proof of one does not necessarily establish the other.” Boyle at 947, quoting Turkette at 583. See Miranda, 138 Ohio St.3d 184, 2014-Ohio-451, 5 N.E.3d 603, ¶ 13. We agree with this conclusion, that proof of one essential element does not “necessarily” prove another. But we emphasize that, logically, evidence that proves one of the elements can sometimes prove the other, even though it doesn’t necessarily do so. The court in Boyle accentuated this point when it stated that “the evidence used to prove the pattern of racketeering activity and the evidence establishing an enterprise ‘may in particular cases coalesce.’ ” Id., quoting Turkette at 583. In so stating, the court expressly rejected the notion that “the existence of an enterprise 5 SUPREME COURT OF OHIO may never be inferred from the evidence showing that persons associated with the enterprise engaged in a pattern of racketeering activity   .” Id. {¶ 11} The court in Boyle concluded that the following jury instruction was not error: “the existence of an association-in-fact is oftentimes more readily proven by what it does, rather than by abstract analysis of its structure.” Boyle, 556 U.S. at 951, 129 S.Ct. 2237, 173 L.Ed.2d 1265. The penultimate sentence of the Boyle opinion essentially answered the question before us when it stated that “proof of a pattern of racketeering activity may be sufficient in a particular case to permit a jury to infer the existence of an association-in-fact enterprise.” Id. {¶ 12} At least one court of appeals in Ohio has wrangled with the issue before us, resolved the case consistent with our decision today, and done so without reference to Turkette or Boyle. Welch, 2006-Ohio-6684. The court in that case reviewed the evidence under a sufficiency standard and concluded that “any reasonable trier-of-fact could have found that Welch was operating as part of an enterprise.” Id. at ¶ 28. In the very next sentence, the court stated, “The same evidence cited above also supports the ‘pattern of corrupt activity’ element.” Id. at ¶ 29. {¶ 13} We hold that the existence of an enterprise, sufficient to sustain a conviction for engaging in a pattern of corrupt activity under R.C. 2923.32(A)(1), can be established without proving that the enterprise is a structure separate and distinct from a pattern of corrupt activity. {¶ 14} We emphasize that we reach our conclusion after analyzing the statutory scheme and applying it to the question before us. We have relied on Turkette and Boyle for guidance, not because they are the law of the land (they are not in Ohio, R.C. 2923.31 and 2923.32 are), but because the reasoning applied by the Supreme Court is logical and apt. See Michigan v. Long, 463 U.S. 1032, 1044, 103 S.Ct. 3469, 77 L.Ed.2d 1201 (1983) (United States Supreme Court will not review state cases that rely “on an adequate and independent state ground”). 6 January Term, 2015 {¶ 15} The court of appeals concluded that “Beverly’s conviction for Engaging in a Pattern of Corrupt Activity is not supported by sufficient evidence.” 2013-Ohio-1365, ¶ 31. We disagree. The standard when testing the sufficiency of the evidence “ ‘is whether, after viewing the evidence in a light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime proven beyond a reasonable doubt.’ ” State v. McKnight, 107 Ohio St.3d 101, 2005-Ohio-6046, 837 N.E.2d 315, ¶ 70, quoting State v. Jenks, 61 Ohio St.3d 259, 574 N.E.2d 492 (1991), paragraph two of the syllabus. {¶ 16} The record is replete with examples of Beverly and Imber associating together for a common purpose of engaging in a course of conduct. Beverly and Imber drove (and perhaps stole) an Ohio Department of Transportation truck and used it to steal an expensive stump grinder. They used a stolen Chevrolet Caprice in the course of an attempted burglary. And most notoriously, for purposes of this case, they used a stolen truck to commit several burglaries on January 28, 2011. It is clear to us that the record provides ample support for a rational trier of fact to conclude that Beverly and Imber constituted an association-in-fact enterprise and that they engaged in a pattern of corrupt activity. Indeed, we cannot imagine a trier of fact concluding otherwise.