Antitrust Law Daily Wrap Up, RICO—10th Cir.: Dismissal of RICO claim for failure to allege enterprise upheld, (Jan 13, 2014)

By Edward L. Puzzo, J.D.

A claim of RICO violations in connection with a foreclosure and eviction was properly dismissed due to plaintiff’s failure to allege an enterprise, the U.S. Court of Appeals in Denver has ruled (Crowe v. Clark, January 10, 2014, Anderson, S.).

Plaintiff Vicki Dillard Crowe, proceeding pro se, alleged various constitutional and statutory violations arising from foreclosure and eviction proceedings involving her home in Denver. The defendants, including the City of Denver and various officers involved in the eviction, were never served and therefore made no answers or other pleadings in this case.

Crowe asserted 18 claims against the individuals and entities that she claimed were responsible for wrongfully evicting her and her mother, who resided with her. Among her claims were various RICO allegations. The district court allowed her to proceed in forma pauperis, but found her RICO claims frivolous because she failed to allege an enterprise or injury and invoked inapplicable provisions of the RICO statute. The district court therefore dismissed her RICO claims with prejudice.

Upon appeal, the appellate court reviewed the lower court’s dismissal de novo. A RICO claim under §1962, the appellate court explained, required conduct of an enterprise through a pattern of racketeering activity. The plaintiff claimed that the lower court had erred in finding that she had failed to allege an enterprise. She argued that an enterprise was apparent from defendants’ alleged wrongdoing during the eviction.

Enterprise defined. The appellate court clarified that an enterprise need not exist separate and apart from a pattern of racketeering activity. Citing Boyle v. U.S., 556 U.S. 938 (2009), the court noted that to qualify as an association-in-fact enterprise, a group must have a common purpose to engage in a course of conduct, but that purpose need not exist “beyond or independent of the group’s pattern of racketeering activity.”

Nevertheless, the appellate court explained, the plaintiff sought to define an enterprise by defendants’ alleged wrongdoing during the eviction, but she failed to identify any common purpose or course of conduct. She claimed the defendants attempted to detain and kidnap her, presumably to show a pattern of racketeering, but this says nothing about the existence of any ongoing criminal enterprise. The district court was therefore correct to dismiss this claim, the appellate court ruled.

The case is No. 13-1221.

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