Antitrust Law Daily Wrap Up, RICO—C.D. Cal.: Overcharging for dental work would not constitute “racketeering activity”, (Jan 17, 2014)

By John W. Arden, J.D., LL.M.

Alleged overcharging for dental work and attempts to collect the bill did not constitute “racketeering activity” under the federal RICO law, according to the federal district court in Los Angeles (Wald v. Abaro, January 16, 2014, Real, M.). Thus, a patient’s civil RICO action was dismissed with prejudice.

Arnold Wald filed a complaint against dentist Ronald Abaro and his related dental group, containing a claim under the federal Racketeer Influenced and Corrupt Organizations Act, as well as several state law claims.

The elements of a civil RICO claim are: (1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity (known as predicate acts) (5) causing injury to the plaintiff’s business or property. Racketeering activity is defined as acts or threats involving a variety of crimes, such as murder, kidnapping, gambling, arson, robbery, bribery, or extortion, the court stated.

In this case, Wald alleged only that Abaro and the Canoga Park Dental group overcharged him and attempted to collect the bill. “This alleged conduct does not constitute ‘racketeering activity’ as that term is defined in Title 18 U.S.C. §1961(1),” the court held. “Because the Complaint does not contain allegations constituting racketeering activity, the RICO claim is dismissed. Dismissal is with prejudice because any amendment would be futile.”

Since the RICO claim was the sole basis for federal jurisdiction, its dismissal prompted the court to decline to exercise supplemental jurisdiction over the remaining state claims.

The case is No. CV 13-7922-R.

Attorneys: Caroline Vai Lei Cheung (Ford Walker Haggerty and Behar) for Ronald Abaro and Canoga Park Dental.

Companies: Canoga Park Dental

Cases: RICO CaliforniaNews