With results that are not flattering to the Democratic National Committee in its suit against Russia, the Trump campaign, and sundry others: “There are three groups that use RICO indiscriminately: pro se litigants complaining that the Bureau of Indian Affairs implanted SatNav in their junk, plaintiffs’ attorneys of the sort who go to court in a sports coat they keep in their glove compartment, and professional vexatious litigants. That’s why many federal judges often have standard orders they issue in civil RICO cases that say, in effect, ‘you think you have a valid RICO claim? Fine, answer these 20 complicated questions to help me sort it out.’ Judges don’t do that for other claims. …. DNC, your lawsuit appears to reflect you going all-in on public relations strategy at the expense of effective legal strategy.” [Popehat] More: Mike Masnick, TechDirt: “basically a laundry list of the laws that we regularly talk about (especially about how they’re abused in litigation). Seriously, look at the complaint. There’s a CFAA claim, an SCA claim, a DMCA claim, a “Trade Secrets Act” claim… and everyone’s favorite: a RICO claim.”
- Hoping to blame Pacific Gas & Electric power lines for Northern California fires, lawyers from coast to coast descend on wine country [Paul Payne, Santa Rosa Press-Democrat]
- Courts should police lawyers’ handling of class actions, including temptation to sweep additional members with doubtful claims into class so as to boost fees [Ilya Shapiro, Trevor Burrus, and Reilly Stephens on Cato certiorari amicus in case of Yang v. Wortman]
- “Seventh Circuit Curtails RICO Application to Third-Party Payor Off-Label Suits” [Stephen McConnell, D&DL] “Here Is Why The False Claims Act Is An ‘Awkward Vehicle’ In Pharma Cases” [Steven Boranian]
- Litigation finance moves into car crash business [Denise Johnson, Insurance Journal]
- Slain NYC sanitation worker’s “frequent advice to Sanitation colleagues about how to save for the future helped persuade the jury that Frosch had a viable career ahead of him in financial planning,” contributing large future earnings component to $41 million award [Stephen Rex Brown, New York Daily News]
- “Ninth Circuit Overturns State Licensing Scheme Forcing Businesses to Incorporate in California” [Cory Andrews, WLF]
a pro-Drug-War group [Safe Streets Alliance] is using civil RICO to go after banks, bonding companies, landlords, and other commercial vendors that do business with marijuana facilities legalized under Colorado’s Amendment 64. Whatever you think of the underlying Colorado law, RICO (I argue) puts too much power in the hands of bounty-hunting private lawyers.
Now the Tenth Circuit has ruled that Safe Streets Alliance, representing a couple named Reilly, can proceed with a racketeering suit against the Reilly’s marijuana-growing neighbors. The direct damages claimed, including noxious odors, are of the sort that might form the basis of a conventional nuisance action, but the RICO framing could make possible steeper penalties, such as triple damages and attorneys’ fees, while the continued unlawfulness of the growing under federal law (even if left unenforced) knocks out possible defenses for the growers [Eugene Volokh; my 2015 piece]
“[Disliked person or institution] should be investigated for racketeering!” is the sort of slogan “waved around by morons like a big foam finger at a ball game.” But RICO, or the Racketeer Influenced and Corrupt Organizations Act, is a law requiring proof of “the commission of a whole bunch of very specific federal crimes… not just any crime [but] only the ones on the list.” It “is not a … frown emoji. It’s not an exclamation point. It’s not a rhetorical tool to convey you are upset about something…. RICO doesn’t mean ‘this organization advocates things that are bad for society.'” Wait, there’s no RICO predicate act for climate denial or for being the NRA?
Ken White’s RICO explainer at Popehat observes that civil RICO is overused in court both by pro se litigants and by plaintiff’s lawyers who employ it as “a scare tactic and a propaganda tool.” So overused is it that “judges often have standing orders requiring plaintiffs to explain how and why they are claiming RICO — that’s something judges don’t do for almost any other cause of action…. So why do we still have civil RICO? Mostly because Congress is more scared of being called soft on crime than they are interested in reforming time-wasting abusive statutes.” Incidentally, the cutesy acronym for an anything-but-cutesy law is because “Congress likes acronyms like your great-aunt likes porcelain cats.”
P.S. From Jonathan Adler, Greenpeace, RICO, and what goes around comes around.
They knew, because their own allies had told them: “As you know, deception/disinformation isn’t itself a basis for criminal prosecution under RICO.” — an official of the Union of Concerned Scientists, writing to the organizers of a campaign to enlist scientists behind a call for a RICO investigation of the fossil fuel industry for its statements about climate change. The letter added, explaining UCS’s unwillingness to back the letter, “We don’t think that Sen. [Sheldon] Whitehouse’s call gives enough of a basis for scientists to sign on to this as a solid approach at this point.” [Reason]
Despite cautions like these, calls for a RICO investigation soon caught on among the political class and an investigation launched by Democratic state attorneys general has now aimed dragnet climate subpoenas at the Competitive Enterprise Institute and, thus far less directly, at nearly 100 advocacy, free-market, and university-based groups. “These include the U.S. Chamber of Commerce Foundation, the George Mason University Law and Economics Center, the American Enterprise Institute, the National Taxpayers Union Foundation, the Cato Institute [which publishes Overlawyered], the National Black Chamber of Commerce, the Federalist Society for Law and Public Policy Studies, the Heritage Foundation, and on and on,” writes Ronald Bailey. CEI responded to the subpoena here (in a brief written by Andrew Grossman) and here, and on May 13 Cohen Milstein, the private contingency-fee law firm representing the attorney general of the Virgin Islands, responded, reserving the right to compel compliance with the subpoena, which demands the production of ten years’ worth of documents.
Presidential candidates Hillary Clinton and Bernie Sanders are among public figures who have backed calls for a racketeering investigation of fossil fuel companies’ participation in climate debates. I have found no evidence that either has expressed concern about the direction in which such investigations are headed.
- In Tyson Foods v. Bouaphakeo, Kennedy preserves statistical sampling as a way of proving classwide liability; liberal side would have prevailed even with Scalia on court [Mark Moller/PrawfsBlawg, Daniel Fisher, Paul Karlsgodt]
- Cato’s amicus brief suggests nifty administrative-law fix by which Court could excuse Little Sisters of the Poor without stoking culture war [Ilya Shapiro]
- Oral argument in case on whether RICO racketeering law applies extraterritorially [Daniel Fisher, first and second posts; RJR Nabisco v. European Community]
- Luis v. U.S.: oddly split Court restricts freezing of untainted assets when needed to pay for criminal defense [Jonathan Adler, Scott Greenfield]
- Caetano: Court tells Massachusetts to revisit its opinion that Second Amendment cannot apply to stun guns [Jonathan Adler, Eugene Volokh]
- As predicted, Court won’t take up weak claim by Oklahoma and Nebraska that Colorado’s pot law harms them [Tim Lynch and Adam Bates]
- Amicus wranglers, amicus whisperers; friends of court seen to display flock, herd, pack behavior [Adam Liptak, New York Times]
- As an experienced lawyer Hillary Clinton surely knows better than to say the things she’s saying about gun lawsuits. [Charles Cooke, thanks for citing my work]
- While we’re at it, Ms. Clinton, there is so much wrong with your contemplated business exit tax [Ira Stoll, New York Sun]
- Metallica vs. cover band cease/desist spat gets patched up quickly [Rockfeed, followup]
- Alas, RICO suits harassing Colorado legal-pot business appear to be prospering [Jacob Sullum/Reason, my Cato take]
- Judge tosses $21.5 million award in that colorful Holland America case we’ve covered [Seattle Times, earlier]
- Labor-rights case from Colombia causing further difficulty for Terry Collingsworth, attorney known for Alien Tort suits [Daniel Fisher, earlier]
- “Harvard Law Review Freaks Out, Sends Christmas Eve Threat Level Over Public Domain Citation Guide” [Mike Masnick, TechDirt]
An editorial in this morning’s Wall Street Journal is blunt:
Advocates of climate regulation are urging the Obama Administration to investigate people who don’t share their views.
Last month George Mason Professor Jagadish Shukla and 19 others signed a letter to President Obama, Attorney General Loretta Lynch and White House science adviser John Holdren urging punishment for climate dissenters. “One additional tool — recently proposed by Senator Sheldon Whitehouse — is a RICO (Racketeer Influenced and Corrupt Organizations Act) investigation of corporations and other organizations that have knowingly deceived the American people about the risks of climate change, as a means to forestall America’s response to climate change,” they wrote.
In other words, they want the feds to use a law created to prosecute the mafia against lawful businesses and scientists. … [RICO] can inflict treble damages upon a defendant. Enacted to stop organized crime and specifically to prosecute individuals tied to loansharking and murder-for-hire, it was long seen as so powerful a tool that the government warned prosecutors to limit its use.
The scientists’ RICO letter was “inadvertently posted” on the website of a group almost entirely funded by taxpayers [Ian Tuttle, National Review Online; Coyote] Rob Nikolewski at Watchdog.org has more on the letter and its aftermath, and quotes me:
Walter Olson, senior fellow at the libertarian Cato Institute’s Center for Constitutional Studies, thinks that’s a dangerous step to take.
“This is core political persuasion,” Olson told Watchdog.org. “If this is illegal racketeering, then potentially an awful lot of things that people debate about are also illegal racketeering … It’s a dangerous power because it won’t be used even-handedly.”
I’m interviewed at Vermont Watchdog about the truly terrible idea of aiming a civil RICO/racketeering action or investigation against the forces of “climate denial” over wrongful advocacy. The notion seems to have some well organized friends, including Sen. Sheldon Whitehouse (D-R.I.) and, more recently, twenty scientists who recently signed a letter calling for such a probe. “I have no idea how it affects the First Amendment” says one of the letter’s signers, a Vermont scientist, according to a companion report. I should note that when I speak of RICO in the interview transcript, I am referring to the civil-litigation side of the law (“civil RICO”) as distinct from the law’s other wing, “criminal RICO.”
I note, and reject, the idea that the First Amendment protects only truthful speech and thus has no application here because climate skepticism is false. (As Cato and many others argued in last year’s Supreme Court case of Susan B. Anthony List v. Driehaus, controversial speech need not be true to be protected, and in practice an “only truth has rights” rule would give the state a stifling power to punish advocacy in debates that it considers settled.) In substantial part, I note, debate in Washington (and not just in Washington) proceeds by way of advocates’ deployment of half-truths, selectively marshaled data, scientific studies with agendas, and so forth. It is common for both sides to use these techniques. The same techniques are also accepted as standard currency within the adversary process itself, in which the law takes such pride, which makes it particularly absurd to propose defining it as unlawful racketeering to “use dubious information to advance a cause.”
Among those promoting this bad idea: BoingBoing, often regarded as a pro-free-speech site.
P.S. Adapted together with an earlier post into one at Cato at Liberty.
Scientists’ “Letter To President Obama: Investigate Deniers Under RICO” is exactly what it sounds like [Greg Laden, ScienceBlogs] We earlier noted, as a step toward attaching legal consequences to unwanted advocacy, Sen. Sheldon Whitehouse’s (D-R.I.) op-ed “urg[ing] the U.S. Department of Justice to consider filing a racketeering suit against the oil and coal industries for having promoted wrongful thinking on climate change, with the activities of ‘conservative policy’ groups an apparent target of the investigation as well,” as well as Gawker’s call to “arrest climate change deniers.”
P.S. For more on the widely publicized book Merchants of Doubt by Naomi Oreskes and Erik Conway, which condemns various scientists said to be too skeptical of the factual basis for regulation, see links gathered by Judith Curry, including this Reiner Grundmann review. Yet more: “I have no idea how it affects the First Amendment” says Vermont scientist who backs probe of wrongful advocacy [Bruce Parker/Watchdog, quotes me]