Antitrust Law Daily Wrap Up, RICO—E.D. La.: Lack of financial injury dooms former church-goer’s racketeering claims, (May 31, 2016)

By Greg Hammond, J.D.

A former member of a church failed to allege that the church’s founder and her daughter violated the Racketeer Influenced and Corrupt Organizations Act (RICO) by fraudulently promulgating that the founder had face-to-face, “in the flesh” meetings with Jesus Christ and participated in a pattern of racketeering by sending extortionate letters and settlement agreements to secure the former member’s silence. In dismissing the RICO claim, the federal district court in New Orleans concluded that the former member pleaded no cognizable injury sufficient to support a RICO claim (Scheppegrell v. Hicks, May 26, 2016, Lemelle, I.).

The former member claimed that Christ Gospel Churches International, Inc. founder Berniece Hicks engaged in a pattern of racketeering activity by fraudulently promulgating worldwide, by mail and wire, that she had face-to-face, “in the flesh” meetings with Jesus Christ. In addition, the former member claimed that Hicks directed her daughter’s unlawful activity, arguing that the daughter participated in a pattern of racketeering by sending extortionate letters and settlement agreements that secured victim’s silence, and protected the church’s illegal revenue stream. In particular, the former member entered into a settlement agreement whereby he agreed to take down a blog that sought to expose Hicks’ alleged plagiarism and to debunk her “Doctrine of the Bride.” The defendants moved to dismiss.

The court granted the motion to dismiss, finding that the former member failed to adequately allege damages to business or property. The alleged threat to his reputation, business relationships, and ability to earn a living, and his “reasonable fear” of economic harm that “remains a damoclean sword” over his head were deemed wholly speculative. The court also found that the former member’s inability to reproduce his blog and inability to write a tell-all book were insufficient injuries absent a showing of concrete financial loss, and the former member did not claim that he had any book deal and conceded that his blog was not “monetized.”

The only concrete financial injury alleged by the former member, according to the court, was his tithing of $22,000 as a result of Hick’s allegedly unlawful activities. However, because the plaintiff was aware of the injury in 1984 at the latest, when he left the church, the injury was deemed too distant to support a RICO claim filed roughly 30 years later.

The case is No. 15-5794.

Attorneys: Fred l. Herman (Law office of Fred l. Herman) for Louis Scheppegrell, II.

Cases: RICO LouisianaNews