Court Opinion

ID: 4285848
Source: CourtListenerOpinion
Date Created: 2018-06-19 18:57:58.55709+00
Date Added: 2024-06-11T14:35:52.284866
License: Public Domain

J-S18014-18

                              2018 Pa. Super. 170

RICHARD C. HVIZDAK                                IN THE SUPERIOR COURT
                                                     OF PENNSYLVANIA

                          Appellant

                     v.

DOUGLAS G. LINN, ESQUIRE, JENNIFER
R. LINN, ESQUIRE, LINN LAW GROUP
AND MICHELLE M. HVIZDAK

                          Appellees                 No. 1012 WDA 2017

                Appeal from the Order entered June 9, 2017
               In the Court of Common Pleas of Butler County
                      Civil Division at No: AD 15-11055

BEFORE: STABILE, J., MUSMANNO, J., and FORD ELLIOTT, P.J.E.

OPINION BY STABILE, J.:                           FILED JUNE 18, 2018

      Appellant, Richard C. Hvizdak (“Husband”), appeals pro se from an order

sustaining the preliminary objections of Appellees, Douglas G. Linn, Esquire,

Jennifer R. Linn, Esquire, Linn Law Group (collectively “Attorneys”) and

Michelle M. Hvizdak (“Wife”) to Husband’s third amended complaint and

dismissing his civil action with prejudice.

      This action arises from Husband’s and Wife’s bitter divorce proceedings

in the Court of Common Pleas of Butler County from 2007 to 2013. Attorneys

represented Wife during the proceedings. Husband asserts, inter alia, that

Wife’s and Attorneys’ conduct during the divorce case render them liable to

Husband for violating the federal Racketeer Influenced and Corrupt

Organizations Act (“RICO”), 18 U.S.C. § 1962(c), as well as for abuse of

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process and wrongful use of civil proceedings.        The trial court held that

Husband failed to state valid causes of action. We affirm.

                               Divorce Proceedings1

       Husband and Wife married in 1994 and had two children during the

marriage. In 2007, they divorced, and trial court entered a temporary order

of child support requiring Husband to pay $7,500 per month to Wife for the

child support. The court also granted Wife exclusive possession of the marital

residence.

       In September 2007, Husband presented a petition for special relief

claiming that a pre-marital agreement prohibited Wife from removing any of

his personal property from the marital residence. On September 26, 2007,

the trial court enjoined Husband and Wife from dissipating or removing the

other’s assets pending equitable distribution proceedings.       In July 2008,

____________________________________________

1 We take judicial notice of our decisions in two appeals during the divorce
proceedings at Nos. 2057 WDA 2007 and 37 WDA 2012.

Ordinarily, when reviewing an order sustaining a demurrer to a complaint, we
cannot take judicial notice of records from other cases. Styers v. Bedford
Grange Mut. Ins. Co., 900 A.2d 895, 899 (Pa. Super. 2006). However, there
are exceptions to this rule. First, we can take judicial notice of other
proceedings involving the same parties. Estate of Schulz, 139 A.2d 560,
563 (1958). The two prior decisions involve the same parties and therefore
are subject to judicial notice. Second, “[i]t is appropriate for a court to take
notice of a fact . . . which is incorporated into the complaint by reference to a
prior court action.” Styers, 900 A.2d at 899. Husband alleges in his third
amended complaint that Appellees committed a series of torts during the
divorce proceedings between 2007 to 2013. Since virtually every paragraph
in Husband’s third amended complaint concerns the divorce litigation, he has
effectively incorporated the entire divorce proceeding, and our decisions
therein, into his third amended complaint.

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Husband filed a petition for civil contempt against Wife for removing his items

from the residence in violation of the September 26, 2007 order. On August

26, 2008, the court ordered Wife to return all items that did not belong to her

or the children.    On November 13, 2008, the court held that Wife had

substantially complied with the August 26, 2008 order and continued the

contempt petition to a later date.

      On February 13, 2009, Husband filed a contempt petition against

Attorneys alleging that Wife had violated the September 26, 2007 order at

their direction.   On February 27, 2009, the trial court denied Husband’s

petition, observing that the contempt matter was moot because Wife had

complied with the August 26, 2008 order directing return of Husband’s

property.   Husband appealed to this Court at No. 565 WDA 2009, which

affirmed the order denying Husband’s contempt petition against Attorneys.

      The divorce proceedings reached their climax in late 2011 and early

2012 in a dispute over a global settlement agreement. We described these

events in Wife’s appeal at No. 37 WDA 2012:

      On August 22, 2011, the parties reached a global settlement
      agreement (the “Agreement”).        Pursuant to the Agreement,
      [Husband] would pay [Wife] $2.5 million. Also pursuant to the
      Agreement, [Husband] was to contribute $3.5 million to be used
      to fund a trust (“the Trust”) for the parties’ children (“the
      Children”) in discharge of [Husband]’s child support obligations.
      Finally, the Agreement required [Husband] to pay $350,000.00 in
      counsel fees to [Wife]’s attorneys.

      The parties retained counsel to draft documents governing the
      Trust, and the drafting of the Trust documents took place between
      August 22 and a scheduled September 28, 2011 bankruptcy

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      hearing. The drafting process was contentious, and in the hours
      immediately preceding the September 28, 2011 bankruptcy
      hearing [Wife] requested removal of language in the Trust
      stipulating that the Trust funds were to be spent for the benefit of
      the Children. [Wife] believed that she would be able to spend
      trust funds for her own support as well as for the Children. [Wife]
      alleges that she signed the Agreement and the Trust documents
      believing that the requested revision had been made. A federal
      bankruptcy judge ratified the signed Agreement and Trust
      documents on September 28, 2011 and dismissed the bankruptcy
      proceeding.

      [Wife] argues that the Trust documents are not binding because
      the parties did not reach a meeting of the minds as to [Wife]’s
      ability to use the Trust funds for herself as well as for the Children.
      [Husband] argues that the purpose of the Trust was to ensure that
      sufficient funds were available to satisfy his obligation to support
      the Children. [Husband] agrees that [Wife], as caretaker, will
      benefit directly or indirectly from using the Trust money for items
      such as housing and food, but [Husband] argues that the parties
      never intended [Wife] to have unfettered discretion to use the
      Trust money for any purpose.

      After the ratification of the Agreement in bankruptcy court,
      [Husband] provided the agreed upon funds. [Wife] has declined
      to use the money to fund the Trust, pending the outcome of the
      parties’ current dispute. [Husband] therefore filed a petition for
      special relief on October 25, 2011, asking the trial court to direct
      [Wife] to fund the Trust pursuant to the Agreement or to replace
      [Wife] as trustee. The trial court granted [Husband]’s petition in
      relevant part on December 8, 2011, and entered an order
      directing the parties to execute the Trust documents. [Wife] filed
      a motion to reconsider on December 28, 2011. After conducting
      a hearing on [Wife]’s reconsideration motion, the trial court
      denied relief in the order presently on appeal.

Hvizdak v. Hvizdak, 2013 WL 11279596, at *1 (Pa. Super., Feb, 22, 2013)

(appeal of Wife).

      On January 6, 2012, Wife appealed to this Court. On February 22, 2013,

we affirmed the trial court’s decision, holding that the Trust agreements were

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solely for the children’s benefit and stating, “Nothing in the record evinces the

parties' intent to draft Trust documents clothing Mother with unfettered,

unreviewable discretion to dissipate Trust assets without regard for the

[c]hildren’s benefit.” Id. at *4. Wife did not file a petition for allowance of

appeal to the Supreme Court.

                              The Present Case

      On May 19, 2014, Husband filed a civil action against Wife and Attorneys

in the Court of Common Pleas of Allegheny County alleging that their conduct

in the Butler County case rendered them liable for racketeering and common

law torts.   On May 27, 2014, Husband filed an amended complaint in the

Allegheny County action.

      According to Husband, in violation of court orders, Attorneys and Wife

conspired to steal valuable personal property from the former marital

residence in a burst of “pathological glee.” First Amended Complaint at ¶¶

27-28.   Husband also accused Wife of “allow[ing] un-housebroken pets to

deface, urinate or defecate over sofas, chairs, carpets, and torn down

draperies, all of this fomenting an ambience of fetid squalor inside the

mansion.” Id. at ¶ 29.

      According to Husband, the judge presiding over the divorce proceedings

was “vulnerable” to Attorneys’ “influences” and grew a “malignant obsession

with [Husband], developing [into] an immutable idee fixe.” Id. at ¶¶ 48-49.

Attorneys “puppeteer[ed]” the judge into seizing Husband’s passport, thus

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preventing Husband from traveling to England on business ventures. Id. at

¶ 79. In addition, Appellant claimed:

      [Attorneys] concocted a sensational whispering campaign to
      circulate the stupendous lie that [Husband] enlisted members of
      the “Pagans” motorcycle gang to assassinate Butler County
      President Judge Thomas Doerr, Judge Kelly Streib and
      [Attorneys]. The Butler County forum became poisoned for
      [Husband] and [his] efforts to have law enforcement or the
      judiciary investigate the matter only engendered new enmities
      and rekindled suspicions.

Id. at ¶ 80.

      Wife and Attorneys filed preliminary objections objecting to venue and

asserting that Husband failed to state valid causes of action. On August 13,

2015, the Allegheny County court sustained the preliminary objection to venue

and ordered Husband’s action transferred to Butler County. Husband did not

appeal this decision.

      On December 21, 2015, Butler County President Judge Doerr assigned

the case to the Honorable S. Michael Yeager. Husband wrote to Judge Doerr

requesting that he “rescind” his case assignment order and disqualify the

entire Butler County bench from hearing the case.     On January 15, 2016,

Judge Yeager recused himself. On January 25, 2016, the case was reassigned

to Judge Marilyn J. Horan. On January 26, 2016, Husband filed a motion for

recusal of Judge Doerr and the entire Butler County bench. On February 2,

2016, the motion was denied on the grounds that (1) the request with respect

to Judge Doerr was untimely and thus moot, and (2) the individual judge

assigned to the case alone could determine her own recusal.

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      On February 16, 2016, Husband filed another motion for recusal of the

entire Butler County bench, including Judge Horan. Husband asserted that

(1) false rumors had circulated during his divorce case that he had hired

motorcycle gang members to assassinate Attorneys and local judges; (2)

Husband requested the appointment of a grand jury to investigate the matter;

(3) due to his request for a grand jury, President Judge Doerr recused himself;

and (4) President Judge Doerr then denounced Husband in the media and

threatened to sue him. Husband alleged that as a result of President Judge

Doerr’s animus against him, an appearance of impropriety would arise if any

other member of the Butler County bench, including Judge Horan, presided

over this case.

      On March 2, 2016, Husband filed a motion for extraordinary relief in our

Supreme Court seeking recusal and disqualification of the Butler County

bench. On March 3, 2016, Judge Horan heard oral argument on Husband’s

motion.    On March 4, 2016, Judge Horan stayed her decision pending the

disposition of Husband’s motion in the Supreme Court. On June 10, 2016, the

Supreme Court denied Husband's motion.

      On August 3, 2016, Judge Horan denied Husband's motion for recusal,

stating:

      Following careful review of the record, [Husband’s] Motion for
      Recusal and disqualification of this judge, and argument by
      [Husband] and Defendants from March 3, 2016, this judge
      concludes that there is no legitimate basis to grant [Husband’s]
      Motion. This judge has no prior involvement with [Husband] or

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      with any matters involving him within this Court. There is nothing
      to preclude this judge from presiding over the above case.

Order, 8/1/16, at 2.

      Judge Horan scheduled briefing and argument on the remaining

preliminary objections to Husband’s first amended complaint. On November

3, 2016, Judge Horan entered an order sustaining the preliminary objections

to the amended complaint for legal and factual insufficiency but permitted

Husband sixty days to file a second amended complaint to cure the defects.

      On January 3, 2017, Husband filed a second amended complaint. Wife

and Attorneys filed preliminary objections to the second amended complaint’s

legal and factual sufficiency. Husband responded by filing a third amended

complaint on March 1, 2017 which purported to set forth claims of RICO Act

violations, conspiracy, fraud, abuse of process, and wrongful use of civil

proceedings arising out of the aforementioned divorce litigation.

      The third amended complaint was similar in content to the first amended

complaint discussed above. Husband alleged that Appellees were liable under

RICO for the following pattern of acts:

      [Appellees] generated a plethora of predicate acts within the
      2007-2013 period, but most notably: a) the conjuring of a
      fictitious protection from abuse order, 2007; b) the seizure of my
      personal and Trust property from the mansion, 2008; c) the
      despoilment of the house and grounds themselves; d) the ex parte
      seizure of my passport caused by baseless claims that I was
      disposing of assets to flee to Vietnam(!); e) the threatened
      imprisonment to coerce my signature upon tax return checks, f)
      other recurring motions for contempt over discovery demands
      that were oppressively burdensome to meet, 2007-2010; g)
      fraudulently procuring a court order freezing my assets and

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      forcing my businesses to shut down, 2010; h) unreasonably and
      deceitfully challenging a settlement in Common Pleas Court after
      accepting the settlement proceeds, 2012; i) unreasonably and
      deceitfully pursuing the matter into Superior Court after being
      reject[ed] in trial court, 2013.

Third Amended Complaint at ¶ 46. On March 20, 2017, Wife and Attorneys

filed preliminary objections to the third amended complaint’s legal and factual

insufficiency.

      On June 9, 2017, Judge Horan entered a memorandum and order

dismissing the third amended complaint with prejudice for failing to state a

cause of action. Husband timely appealed. Both Husband and Judge Horan

complied with Pa.R.A.P. 1925.

                                 Discussion

      Husband raises the following issues in this appeal, which we re-order for

the sake of convenience:

      1. Was it an abuse of discretion for the Judges of Allegheny and
      Butler Counties to declare [Husband’s] choice of forum [an]
      improper venue, when the brunt of economic injury was borne to
      business interests located within Allegheny County, where
      [Husband] resides and where the counsel for [Appellees] both live
      and work?

      2. Did extreme circumstances in this case, including false claims
      that [Husband] once plotted with motorcycle gang members to
      assassinate Butler Judges and lawyers (which provoked police
      inquiries and inspired a recusal), and public expressions of
      animosity over [Husband’s] motion for a grand jury investigation
      into [sic] justify grant of [Husband’s] motion to disqualify the
      Butler County judiciary?

      3. Was the third amended complaint, which identified at least
      eight arguable predicate acts of racketeering, along with
      conspiracy, fraud, and abuse of process claims against

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      [Appellees], frequently using mail fraud, within a 2007 through
      2013 period, constitute a cognizable claim for a racketeer[ing]
      pattern, or failing that, of a conspired, fraudulent scheme ?

      4. Does a two year statute of limitation bar [] Husband’s claims,
      even though [Appellees] were pressing a Superior Court appeal
      against [Husband] all throughout 2012, using mail fraud to
      continue a baseless, fraudulent matter?

      5. Does the four year statute of limitations as announced in
      Agency Holding Corp. v. Malley-Duff & Associates, 483 U.S.
143 (1987) for racketeer[ing] claims, as well as the 18 U.S.C.
      1961(5) “pattern of racketeering activity, at least two predicate
      acts within a ten year period,” satisfy any concerns about untimely
      filing here?

Husband’s Brief at 4.

      Husband first argues that the Allegheny County court erred by

sustaining Wife’s and Attorneys’ preliminary objection to venue and

transferring Husband’s action to Butler County.          Pursuant to Pa.R.A.P.

311(g)(1)(ii), Husband forfeited the opportunity to raise this argument by

failing to appeal within thirty days after entry of the order transferring venue.

      Pa.R.A.P. 311(c) provides that “[a]n appeal may be taken as of right

from an order in a civil action . . . changing venue . . .” The appeal must be

filed within thirty days after entry of the order changing venue. Pa.R.A.P. 902.

At the time of the Allegheny County court’s order, Pa.R.A.P. 311(g)(1)(ii)

provided, “Where an interlocutory order is immediately appealable under this

rule, failure to appeal . . . shall constitute a waiver of all objections . . . to

venue . . . and the question of venue shall not be considered on any

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subsequent appellate review of the matter.”2             Here, the Allegheny County

court entered its order transferring venue on August 13, 2015. This order was

immediately appealable under Rule 311(c), but Husband failed to appeal to

this Court within the next thirty days.            Thus, under Rule 311(g)(1)(ii), he

cannot object to the transfer of venue to Butler County in this appeal.

       In his next argument, Husband contends that Judge Horan abused her

discretion by denying Husband’s motion to recuse herself from this case.

Husband admits that he has no specific concern about Judge Horan; he simply

believes that she would rule against him so as not to offend President Judge

Doerr. Appellant’s Brief at 18. In effect, Appellant argues that no judge on

the Butler County bench can preside impartially over this case due to the

desire to remain in President Judge Doerr’s good graces. We conclude that

Judge Horan properly denied Appellant’s motion to recuse.

       “There is a presumption that judges of this Commonwealth are

honorable, fair and competent[.]”              In re Lokuta, 11 A.3d 427, 453 (Pa.

2011). Thus, a party seeking recusal “bears the burden of producing evidence

to establish bias, prejudice, or unfairness which raises a substantial doubt as

to the jurist’s ability to preside impartially.” Commonwealth v. Watkins,

108 A.3d 692, 734 (Pa. 2014). A trial judge facing a recusal request must

____________________________________________

2 Although our Supreme Court revised the text of Rule 311(g)(1)(ii) on
December 14, 2015, the meaning of the rule remains the same, i.e., a party
waives his objection to an order transferring venue unless he files an appeal
within thirty days after entry of the order.

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consider (1) whether she can “assess the case in an impartial manner, free of

personal bias or interest in the outcome,” and (2) whether presiding over the

case would “create an appearance of impropriety and/or would tend to

undermine public confidence in the judiciary.” Commonwealth v. Kearney,

92 A.3d 51, 62 (Pa. Super. 2014). Thus, a judge shall recuse herself from a

“proceeding in which the judge’s impartiality might reasonably be questioned.”

Pa. Code of Judicial Conduct Rule 2.11. “Where a jurist rules that he or she

can hear and dispose of a case fairly and without prejudice, that decision will

not be overruled on appeal but for an abuse of discretion.” Kearney, 92 A.3d

at 62.

         As noted above, Husband effectively seeks not only Judge Horan’s

recusal but also the recusal of every judge on the Butler County bench.

Occasionally, but rarely, it is necessary for all jurists in a particular county to

recuse themselves from a case. See, e.g., Commonwealth ex rel. Armor

v. Armor, 398 A.2d 173, 174 (Pa. Super. 1978) (recusal of entire Montgomery

County trial court bench required where spouse of one judge had financial

interest in child support case pending in Montgomery County). In most cases,

this step is unnecessary. See, e.g., Commonwealth v. Melvin, 103 A.3d 1,

22-23 (Pa. Super. 2014) (defendant, a former Superior Court judge and

Supreme Court justice, was not entitled to recusal of all members of county

bench in her criminal trial, even though defendant had formerly been a

member of that county bench, and her former law clerk was the wife of a

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member of county bench; defendant had no current relationship as colleague

with any bench members, and neither her former law clerk nor her husband

had any financial interest in outcome of case).

      In the present case, Husband failed to demonstrate any reason for Judge

Horan to recuse herself. Unlike Armor, there is no evidence that another

judge on the Butler County bench has any financial interest in this case.

Moreover, assuming that President Judge Doerr has any conflict with Husband,

no reason exists to infer that this conflict affects Judge Horan in any way.

Indeed, Judge Horan stated in her order denying recusal that she has no prior

involvement with Husband or with any cases involving Husband. Husband’s

argument that Judge Horan would rule against him in order to please President

Judge Doerr is sheer conjecture.      There is no evidence to overcome the

presumption that Judge Horan was anything other than “honorable, fair and

competent” in this case. Lokuta, 11 A.3d at 453.

      In his third argument, Husband contends that the trial court erred by

determining that the third amended complaint failed to state a valid cause of

action for RICO violations and other common law torts.         “In determining

whether the trial court properly sustained preliminary objections, the appellate

court must examine the averments in the complaint, together with the

documents and exhibits attached thereto, in order to evaluate the sufficiency

of the facts averred.” Clausi v. Stuck, 74 A.3d 242, 246 (Pa. Super. 2013).

The purpose of this inquiry is to “determine the legal sufficiency of the

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complaint and whether the pleading would permit recovery if ultimately

proven.”    Id.    The appellate court “will reverse the trial court’s decision

regarding preliminary objections only where there has been an error of law or

abuse of discretion.” Id. We address each cause of action alleged by Husband

below.

       RICO claim. Although RICO is a federal act, Pennsylvania courts and

federal courts exercise concurrent jurisdiction over civil RICO actions.

Drohan v. Sorbus, Inc., 584 A.2d 964, 968   (Pa. Super. 1990).

Pronouncements of the United States Supreme Court concerning RICO are

binding on us, but the decisions of lower federal courts are not.

Commonwealth v. Walker, 139 A.3d 225, 230–31 (Pa. Super. 2016).

Nevertheless, we may rely on decisions of lower federal courts for persuasive

authority. EMC Mortgage, LLC v. Biddle, 114 A.3d 1057, 1064 n.6 (Pa.

Super. 2015).

       Husband claims that the third amended complaint states a valid RICO

action under 18 U.S.C. § 1962(c), which requires Husband to plead that Wife

and Attorneys conducted an “enterprise” through a “pattern” of “racketeering

activity.”3 Id.; Reyes v. Netdeposit, LLC, 802 F.3d 469, 483 (3d Cir. 2015).

____________________________________________

3  An “enterprise” includes “any individual, partnership, corporation,
association, or other legal entity, and any union or group of individuals
associated in fact although not a legal entity.” 18 U.S.C. § 1961(5). We need
not examine whether Husband has satisfied the “enterprise” element because

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We hold that Husband has failed to allege that Appellees engaged in any

“racketeering activity” or in any “pattern” of racketeering activity.

       The definition of “Racketeering activities” identifies a lengthy list of

criminal acts (commonly referred to as “predicate acts”), which include, in

relevant part,

       any act or threat, involving murder, kidnapping, gambling, arson,
       robbery, bribery, extortion, dealing in obscene matter, or dealing
       in a controlled substance or listed chemical, which is chargeable
       under state law and punishable by imprisonment for more than
       one year; any act which is indictable under any of the following
       provisions of title 18, United States Code . . . section 1341
       (relating to mail fraud), . . . [and] section 1951 (relating to
       interference with commerce, robbery, or extortion).

18 U.S.C. § 1961(1).

       First, Husband contends Appellees violated 18 U.S.C. § 1951 (also

known as the Hobbs Act) and committed extortion under Pennsylvania law by

“threaten[ing]” to “imprison[] [Husband] to coerce [his] signature upon tax

return checks.” The trial court correctly rejected this argument.

       The Hobbs Act defines extortion as “the obtaining of property from

another, with his consent, induced by wrongful use of actual or threatened

force, violence, or fear.”         18 U.S.C. § 1951 (emphasis added).       Since

Appellees’ threats allegedly took place during divorce proceedings, it appears

that Husband alleges that Appellees threatened to ask the judge in the divorce

____________________________________________

we dispose of his RICO claim through analysis of the “racketeering activity”
and “pattern” elements.

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case to imprison Husband unless he signed tax return checks. This did not

involve any threat of force or violence. Moreover, threats of litigation do not

constitute inducement of “fear” under the Hobbs Act.             See Deck v.

Engineered Laminates, 349 F.3d 1253, 1258 (10th Cir. 2003) (joining

“multitude of other courts in holding that meritless litigation is not extortion

under [the Hobbs Act]”); Vemco, Inc. v. Camardella, 23 F.3d 129, 134 (6th

Cir. 1994) (“A threat of litigation if a party fails to fulfill even a fraudulent

contract ... does not constitute extortion”);    I.S. Joseph Co., Inc. v. J.

Lauritzen A/S, 751 F.2d 265, 267 (8th Cir. 1984) (even bad faith threat of

civil action does not constitute infliction of “fear” under Hobbs Act); Peterson

v. Philadelphia Stock Exchange, 717 F. Supp. 332, 336 (E.D. Pa. 1989)

(“The ordinary resort to legal process does not rise to the level of a ‘wrongful

use’ of force or fear” under Hobbs Act); G–I Holdings, Inc. v. Baron &

Budd, 179 F. Supp. 2d 233, 259 (S.D.N.Y. 2001); Grauberger v. St. Francis

Hosp., 169 F. Supp. 2d 1172, 1178 (N.D.Cal. 2001); von Bulow by

Auersperg v. von Bulow, 657 F. Supp. 1134, 1143–45 (S.D.N.Y. 1987).

      Pennsylvania’s Crimes Code defines extortion as, inter alia, obtaining

property of another by “threatening to accuse anyone of a criminal offense.”

18 Pa.C.S.A. § 3923(a)(2).       Despite filing several amended complaints,

Husband consistently failed to assert that Appellees threatened to imprison

Husband for a criminal offense.      Because the threat allegedly took place

during divorce proceedings, it could have been a threat to seek imprisonment

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for civil contempt—sanctions that occasionally take place during combative

divorce cases.   See, e.g., Sinaiko v. Sinaiko, 664 A.2d 1005, 1010 (Pa.

Super. 1995) (court acted within its discretion by ordering husband’s

imprisonment for failure to pay court-ordered attorney fees).

      Next, Husband alleges that several of Appellees’ acts constitute mail

fraud, including (1) a Protection From Abuse order procured against him

through fraud, (2) the seizure of his passport based on the false claim that he

was planning to flee to Vietnam, (3) the fraudulent procurement of a court

order freezing his assets and thus shutting down his business, and (4) the

“deceitful” challenge to the divorce settlement in the trial court and Superior

Court after Wife’s acceptance of settlement proceeds. The trial court correctly

held that Husband failed to allege mail fraud.

      The elements of the predicate acts of mail fraud are: “(1) the existence

of a scheme to defraud; (2) the participation by the defendant in the particular

scheme with the specific intent to defraud; and (3) the use of the United States

mail or of wire communications in furtherance of the fraudulent scheme.”

United States v. Syme, 276 F.3d 131, 142 n.3 (3d Cir. 2002).                The

defendant must have the specific intent to defraud, which “may be found from

a material misstatement of fact made with reckless disregard for the truth.”

United States v. Coyle, 63 F.3d 1239, 1243 (3d Cir. 1995). The scheme to

defraud “need not be fraudulent on its face but must involve some sort of

fraudulent misrepresentations or omissions reasonably calculated to deceive

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persons of ordinary prudence and comprehension.”           United States v.

Pearlstein, 576 F.2d 531, 535 (3d Cir. 1978).

     A civil RICO plaintiff alleging mail fraud must show that his injuries were

proximately caused by the defendant’s scheme to defraud, and that he

detrimentally relied on the defendant’s misrepresentations. Bank of China

v. NBM L.L.C., 359 F.3d 171, 176 (2d Cir. 2004); Chisolm v. TranSouth

Fin. Corp., 95 F.3d 331, 337 (4th Cir. 1996) (“where the predicate act giving

rise to civil liability under RICO was alleged to have been mail fraud,

prospective plaintiffs must, in order to demonstrate their standing to sue,

plausibly allege both that they detrimentally relied in some way on the

fraudulent mailing and that the mailing was a proximate cause of the alleged

injury to their business or property”); Summit Props. Inc. v. Hoechst

Celanese Corp., 214 F.3d 556, 562 (5th Cir. 2000); Cent. Distribs. of Beer,

Inc. v. Conn, 5 F.3d 181, 184 (6th Cir. 1993); Appletree Square I v. W.R.

Grace & Co., 29 F.3d 1283, 1286 (8th Cir. 1994); Sikes v. Teleline, Inc.,

281 F.3d 1350, 1360 (11th Cir. 2002); Pelletier v. Zweifel, 921 F.2d 1465,

1499–1500 (11th Cir. 1991).      Similarly, district courts in the Third Circuit

have required a showing of reliance either as a necessary condition of

proximate causation or as an element of a mail fraud violation. See Baker v.

Family Credit Counseling Corp., 440 F. Supp. 2d 392, 410 (E.D. Pa. 2006);

Cooper v. Broadspire Servs., Inc., 2005 WL 1712390, at *8 n. 7 (E.D. Pa.

2005); Smith v. Berg, 2001 WL 1169106, at *3 (E.D .Pa. 2001); Allen

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Neurosurgical Assocs., Inc. v. Lehigh Valley Health Network, 2001 WL
41143, at *4 (E.D.Pa. 2001); Rodriguez v. McKinney, 156 F.R.D. 112, 116

(E.D.Pa. 1994).

      A plaintiff who knows a representation to be untrue cannot use it to

claim fraud in a civil RICO action. The Third Circuit has framed this proposition

as   the   definition   of   a   misrepresentation   itself:    there   can   be   no

misrepresentation if the plaintiff knows the representation to be false.

Brokerage Concepts, Inc. v. U.S. Healthcare, Inc., 140 F.3d 494, 528–

29 (3d Cir. 1998) (defendant did not violate mail fraud statute by seeking

audit of plaintiff because plaintiff knew defendant’s “true motivation” for

seeking audit); Ideal Dairy Farms, Inc. v. John Labatt, Ltd., 90 F.3d 737,

747 (3d Cir. 1996) (no mail fraud predicate based on defendant’s “scheme”

to charge plaintiff more than contract price because plaintiff admitted it knew

defendant was not complying with contract).

      In this case, Husband does not allege that he relied on any of Appellees’

representations    to    his     detriment;   he   always      regarded   Appellees’

representations as false. The third amended complaint merely alleges that

Appellees misled the trial court, not Husband. Under the authorities collected

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above, none of Appellees’ representations constitutes predicate acts of mail

fraud.4

       Finally, Husband accuses Appellees of seizing property from his

mansion, “despoil[ing]” the mansion and grounds, and filing contempt

motions over discovery demands in the divorce proceedings. None of these

acts constitutes racketeering activity. Assuming that Appellees broke into the

mansion to seize personal property and damage the house, this at most

constitutes burglary, which is not a predicate offense under RICO. See 18

U.S.C. § 1961(1); 18 Pa.C.S.A. § 3502 (definition of burglary). It does not

constitute the RICO predicate act of robbery, because Appellees did not inflict

serious bodily injury on Husband or threaten him or intentionally put him in

fear of immediate bodily injury.          See 18 Pa.C.S.A. § 3701 (definition of

robbery). Further, there is no authority that the filing of contempt motions

during litigation constitutes a RICO predicate act.

____________________________________________

4 Appellees argue that Husband fails to state a valid cause of action for
common law fraud in his third amended complaint. It was not necessary for
Appellees to make this point, because Husband did not make any argument
concerning common law fraud in his opening brief. In any event, Husband
does not have a valid action for common law fraud for the same reason that
his RICO fraud claim fails, i.e., Husband never relied to his detriment on
Appellees’ representations. See Gibbs v. Ernst, 647 A.2d 882, 889 (Pa.
1994) (common law fraud requires proof of plaintiff’s justifiable reliance on
defendant’s misrepresentation).

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      Thus, Husband fails to allege a single act of racketeering against

Appellees. Even if he did, the third amended complaint fails to satisfy RICO’s

“pattern” element.

      The United States Supreme Court construes the pattern element to

require “continuity” and “relatedness,” i.e., the RICO predicates must pose a

threat of continuous criminal activity and must be related to each other. H.J.

Inc. v. Northwestern Bell Tel. Co., 492 U.S. 229, 239 (1989). The acts

alleged by Husband do not fulfill the continuity test.

      Continuity requires conduct that “amount[s] to or pose[s] a threat of

continued criminal activity.” H.J., 492 U.S. at 239. Such continuity can be

closed-ended or open-ended. Id. Criminal activity that occurred over a long

period of time in the past has closed-ended continuity, regardless of whether

it may extend into the future. Id. at 242. As such, closed-ended continuity

is “primarily a temporal concept,” Spool v. World Child Int'l Adoption

Agency, 520 F.3d 178, 184 (2d Cir. 2008), and requires that the predicate

crimes extend “over a substantial period of time.” H.J., 492 U.S. at 242. For

example, the Second Circuit generally requires that the crimes extend over at

least two years. Spool, 520 F.3d at 184. Open-ended continuity is criminal

activity “that by its nature projects into the future with a threat of repetition.”

H.J., 492 U.S. at 241.     This encompasses activity that by its very nature

includes a future threat, such as a protection racket. H.J., 492 U.S. at 242.

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In this case, Husband pleads a closed-ended scheme, since it allegedly began

in 2007 and ended in 2013, and there is no threat of repetition.

      Many federal courts have held that a civil RICO claim does not lie when

the plaintiff alleges a closed-ended scheme with only one objective and one

victim. See Home Orthopedics Corp. v. Rodriguez, 781 F.3d 521, 530

(1st Cir. 2015) (quoting Sil–Flo, Inc. v. SFHC, Inc., 917 F.2d 1507, 1516

(10th Cir. 1990)) (“our common sense dictates that where, as here, a closed-

ended series of predicate acts . . . constitute[s] a single scheme to accomplish

one discrete goal, directed at one individual with no potential to extend to

other persons or entities . . . RICO liability cannot attach under a theory of a

closed pattern of racketeering”); Moon v. Harrison Piping Supply, 465 F.3d
719, 725 (6th Cir. 2006) (no RICO liability where defendant had “single

objective” and there were “no facts suggesting that the scheme would

continue beyond the [d]efendants accomplishing their goal”); Edmondson &

Gallagher v. Alban Towers Tenants Ass’n, 48 F.3d 1260, 1265 (D.C. Cir.

1995) (where there is “single scheme, single injury, and few victims,” it will

be “virtually impossible” to state RICO claim); Flip Mortgage Corp. v.

McElhone, 841 F.2d 531, 538 (4th Cir. 1988) (fraudulent acts lasting seven

years by single entity against single victim did not establish racketeering

pattern). Similarly, the Third Circuit has observed that there is no pattern of

racketeering where the object of fraud is a “single piece of real estate,” or an

attempt “to force a single business entity bankrupt,” or is “directed at a single

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entity,” or can generally be characterized as a “single-scheme, single-victim”

transaction. Hughes v. Consol-Pennsylvania Coal Co., 945 F.2d 594, 610-

11 (3d Cir. 1991) (citing Banks v. Wolk, 918 F.2d 418 (3d Cir. 1990);

Marshall–Silver Construction Co. v. Mendel, 894 F.2d 593 (3d Cir. 1990);

Kehr Packages v. Fidelcor, Inc., 926 F.2d 1406, 1418 (3d Cir. 1991)); see

also Stoss v. Singer Fin. Corp., 2010 WL 678115, at *7 (E.D. Pa. 2010)

(citing Hughes).

      In the present case, Husband merely alleges a closed-ended scheme

with one objective (Husband’s financial ruination) and one victim (Husband).

In view of the decisions summarized above, this does not fulfill RICO’s

“pattern” element.

      Husband also asserts that Appellees are liable for a RICO conspiracy.

The RICO statute provides that it shall be unlawful for any person to conspire

to violate the other RICO provisions. 18 U.S.C. § 1962(d). However, “any

claim under section 1962(d) based on conspiracy to violate the other

subsections of section 1962 necessarily must fail if the substantive claims are

themselves deficient.” Lum v. Bank of America, 361 F.3d 217, 227 (3d Cir.

2004). Since the third amended complaint fails to allege a RICO action under

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Section 1962(c), Husband’s claim of conspiracy under Section 1962(d) falls

short as well.5

         Abuse of process. Appellees argued in their preliminary objections to

Husband’s third amended complaint that his claim for abuse of process was

untimely under Pennsylvania’s two-year statute of limitations, 42 Pa.C.S.A.

§ 5524(7). The trial court agreed and dismissed this action.

         Although it is improper to raise a statute of limitations defense in

preliminary objections, Husband failed to file preliminary objections to

Appellees’ preliminary objections challenging Appellees’ procedural error.

Thus, the trial court had the authority to rule on the statute of limitations

issue.     Preiser v. Rosenzweig, 614 A.2d 303, 305 (Pa. Super. 1992)

(“[w]here a party erroneously asserts substantive defenses in preliminary

objections rather than [] raise these defenses by answer or in new matter,

the failure of the opposing party to file preliminary objections to the defective

preliminary objections, raising the erroneous defenses, waives the procedural

defect and allows the trial court to rule on the preliminary objections”).

         The common law cause of action for abuse of process “is defined as the

use of legal process against another primarily to accomplish a purpose for

____________________________________________

5Because we conclude that Husband fails to state a valid RICO claim, we need
not address his arguments that he filed this claim within the applicable statute
of limitations.

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which it is not designed.” Rosen v. American Bank of Rolla, 627 A.2d 190,

192 (Pa. Super. 1993).

     To establish abuse of process, the plaintiff must show that the
     defendant (1) used a legal process against the plaintiff, (2)
     primarily to accomplish a purpose for which the process was not
     designed; and (3) harm has been caused to the plaintiff.

     Abuse of process is, in essence, the use of legal process as a
     tactical weapon to coerce a desired result that is not the legitimate
     object of the process. Thus, the gravamen of this tort is the
     perversion of legal process to benefit someone in achieving a
     purpose which is not an authorized goal of the procedure in
     question.

Werner v. Plater–Zyberk, 799 A.2d 776, 785 (Pa. Super. 2002).

     The Judicial Code provides:

     The following actions and proceedings must be commenced within
     two years: . . .

     (7) Any other action or proceeding to recover damages for injury
     to person or property which is founded on negligent, intentional,
     or otherwise tortious conduct or any other action or proceeding
     sounding in trespass, including deceit or fraud . . .

42 Pa.C.S.A. § 5524(7). This limitation period applies to actions for abuse of

process. See Stone Crushed Partnership v. Kassab Archbold Jackson &

O’Brien, 908 A.2d 875, 879 n.4 (Pa. 2006) (applying Section 5524 to abuse

of process claim); Langman v. Keystone National Bank & Trust Co., 672
F. Supp. 2d 691, 697 (E.D.Pa. 2009) (same).

     Unlike an action for wrongful use of civil proceedings under 42 Pa.C.S.

§ 8351, the tort of abuse of process does not require the plaintiff to

demonstrate that the underlying action terminated in his favor.       P.J.A. v.

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H.C.N., 156 A.3d 284, 291 (Pa. Super. 2017). Thus, the statute of limitations

for abuse of process begins running not when the underlying action terminates

in the plaintiff’s favor, but when the defendant uses legal process against the

plaintiff for an improper purpose, which in turn causes harm to the plaintiff.

Id. (former husband’s abuse of process claim against former wife accrued

when wife filed answer with new matter in child custody proceeding that

allegedly contained false allegations, not when the trial court denied wife’s

request for sole legal custody of the child).

      Husband commenced this action on May 19, 2014. Husband avers in

his third amended complaint that Appellees abused process by forcing him to

enter the global settlement agreement on August 22, 2011. Because this took

place more than two years before Husband filed suit, the trial court correctly

held that his action for abuse of process is time-barred.

      Wrongful use of civil proceedings. The tort of wrongful use of civil

proceedings statute, also known as the Dragonetti Act, is codified at 42

Pa.C.S.A. §§ 8351-9354. Section 8351 provides in relevant part:

      (a) Elements of action.—A person who takes part in the
      procurement, initiation or continuation of civil proceedings against
      another is subject to liability to the other for wrongful use of civil
      proceedings:

      (1) He acts in a grossly negligent manner or without probable
      cause and primarily for a purpose other than that of securing the
      proper discovery, joinder of parties or adjudication of the claim in
      which the proceedings are based; and

      (2) The proceedings have terminated in favor of the person
      against whom they are brought.

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42 Pa.C.S. § 8351(a). In addition,

      [a] person who takes part in the procurement, initiation or
      continuation of civil proceedings against another has probable
      cause for doing so if he reasonably believes in the existence of the
      facts upon which the claim is based, and either:

      (1) reasonably believes that under those facts the claim may be
      valid under the existing or developing law;

      (2) believes to this effect in reliance upon the advice of counsel,
      sought in good faith and given after full disclosure of all relevant
      facts within his knowledge and information; or

      (3) believes as an attorney of record, in good faith that his
      procurement, initiation or continuation of a civil cause is not
      intended to merely harass or maliciously injure the opposite party.

42 Pa.C.S. § 8352.

      The statute of limitations for Dragonetti actions is two years.

Buchleitner v. Perer, 794 A.2d 366, 372 (Pa. Super. 2002). Unlike common

law abuse of process, the statute of limitations for a Dragonetti action does

not begin running until the underlying proceedings terminate. Id. at 376.

Here, the underlying proceedings did not terminate until March 2013, following

Wife’s unsuccessful appeal at 37 WDA 2012.        Thus, Husband’s Dragonetti

action was timely filed.

      The trial court determined, however, that Husband failed to state a valid

Dragonetti action. The third amended complaint did not satisfactorily allege

that Appellees lacked probable cause to appeal from the trial court’s December

8, 2011 order granting Husband’s petition for special relief seeking

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enforcement of the parties’ global settlement agreement.     The trial court

reasoned:

      [Husband] fails to plead that the primary purpose for the
      proceedings was not that of securing adjudication of the claim on
      which the proceedings were based, or facts to support that
      [Appellees] did not have probable cause for continuing said
      proceedings. Although [Husband] avers broadly that [Appellees]
      had no probable cause for appealing the settlement agreement,
      [Husband’s] pleading is a conclusory statement. Facts to support
      a lack of probable cause must be pleaded. In his Third Amended
      Complaint, [Husband] does not allege any facts to support his
      conclusory allegations that probable cause to appeal the
      settlement agreement did not exist at the time when [Appellees]
      filed their appeal.

Trial Ct. Op., 6/9/17, at 16. We agree. We further note that our February

22, 2013 memorandum in Wife’s appeal does not state or suggest that

Appellees’ appeal was frivolous or in bad faith.

      Order affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 6/18/2018

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