Marc Weinstein Discusses Increase in Civil RICO Claims in The National Law Journal

Marc Weinstein discussed the increase of civil lawsuits alleging that business executives violated the federal Racketeer Influenced and Corrupt Organizations Act (RICO) in The National Law Journal.

The article explores the 108% year-over-year increase in civil RICO lawsuits following an April decision by the U.S. Supreme Court’s in Medical Marijuana Inc. v. Horn, which allowed a plaintiff’s civil RICO claims to proceed against a cannabidiol producer.

“The whole idea behind RICO, you have to establish two predicate acts, and those could be mail or wire fraud, which means you made a misstatement and it crossed state lines, which can be anything in commerce,” Weinstein said in the article. “As long as you have a materially false statement, you are going to be able to meet mail and wire fraud.

“It is so easy to meet the elements as long as you have a false statement. It just gives you that RICO predicate.”

According to Weinstein, this precedent set by the court negates the effectiveness and original purpose of the RICO statutes, which were to address organized crime and included a provision allowing plaintiffs to seek treble damages in federal court.

“The idea that a few misrepresentations can get you a RICO claim is just silly,” Weinstein said. “There is no reason to have that law. ... This requires a congressional fix. I don’t know if anyone in Congress cares enough to go back and fix this.”

Read the article.