Duff & Associates, Inc., 483 U.S. 143, 151 (1987) ("private attorneys general [for] a serious national problem for which public prosecutorial resources are deemed inadequate"); Shearson/American Express, Inc. v. McMahon, 482 U.S. 200, 241 (1987) ("vigorous incentives for plaintiffs to pursue RICO claims"); Sedima, 473 U.S. at 493 ("private attorney general provisions... designed to fill prosecutive gaps") (citing Reiter v. Sonotone, 442 U.S. at 344).11/As such, RICO fits easily into a consistent pattern of

federal legislation enacted as general reform over the past half century or more aimed at 12/ a specific target, but drafted without limiting it to the specific target.

While the language of a statute must "ordinarily be regarded as conclusive," it can, of course, give way to a "clearly expressed legislative intention" to the contrary found in the statute's legislative history. Consumer Product Safety Commission v. GTE Sylvania, Inc., 447 U.S. 102, 108 (1980); United States v. Apfelbaum, 445 U.S. 115, 121 (1980) (same). The broad, remedial purposes of RICO and the importance of its private civil

11/ RICO and the antitrust statutes are well integrated. "There are three possible kinds of force which a firm can resort to: violence (or threat of it), deception, or market power." C. Kaysen & D. Turner, Antitrust Policy 17 (1959). RICO focuses on the first two; antitrust focuses on the third. See also American C&L Co. v. United States, 257 U.S. 377, 414 (1921) (Brandeis, J., dissenting) ("Restraint may be exerted through force or fraud or agreement."). See generally Note, Treble Damages Under RICO: Characterization and Computation, 61 Notre Dame. Rev. 526, 533-34 (1986) ("(1) encourage private citizens to bring RICO actions, (2) deter future violators, and (3) compensate victims for all accumulative harm. These multiple and convergent purposes make the treble damage provision a powerful mechanism in the effort to vindicate the interests of those victimized by crime."). 12/ See, e.g., 18 U.S.C. § 1951 (extortion) held not limited to racketeering in United States v. Culbert, 435 U.S. 371, 373-74 (1978); 18 U.S.C. § 1952 (Travel Act) held not limited to organized crime bribery in Perrin v. United States, 444 U.S. 37, 46 (1979); 18 U.S.C. § 1953 (lottery tickets) held not limited to organized crime in United States v. Fabrizio, 385 U.S. 263, 265-67 (1966); 18 U.S.C. § 2113(b) (bank robbery) held not limited to gangsters in Bell v. United States, 462 U.S. 356, 358-62 (1983); 18 U.S.C. § 2421 (1982) (white slave traffic) held not limited to commercial prostitution in Caminetti v. United States, 242 U.S. 470, 485-90 (1917). See generally Equitable Relief at 529 n.13 (other cases collected).

-

remedy to Congress in effectuating those purposes are, however, fully confirmed rather than undercut by its legislative history. "[T]he legislative history [of RICO] shows that Congress knew what it was doing when it adopted commodious language capable of extending beyond organized crime." H.J. Inc., 57 U.S.L.W. at 4955. When RICO's legislative history is carefully reviewed, it demonstrates that "Congress meant what it said." INS v. Phinpathya, 464 U.S. 183, 196 (1984).

[A] review of the legislative history of S. 30 [the Organized
Crime Control Act] in general, and Title IX in particular, esta-
blishes the following points beyond serious question:

(5) Congress was well aware that it was creating
important new federal criminal and civil reme-
dies in a field traditionally occupied by common
law fraud.

Civil Action at 280 (emphasis in original). Civil Action's review of the legislative history of RICO was cited with approval in Russello, 464 U.S. at 28.

3.

Judicial Efforts to Curtail the Implementation of RICO Are Improper.

The private bar did not begin to bring Civil RICO suits until about 1975. When it did, the district courts reacted with extreme hostility and undertook judicially to redraft the statute in an effort to dismiss civil suits in all possible ways. The first effort to redraft civil RICO involved reading into it an "organized crime" limitation. See, e.g., Barr v. WUI/TAS, Inc., 66 F.R.D. 109, 113 (S.D.N.Y. 1975). Because that limitation had no support in the text of the statute it was also specifically voted down in the legislative debates this Court and the Fifth, Seventh and Eighth Circuits quickly rejected it. Alcorn County, Miss. v. U.S. Interstate Supplies, 731 F.2d 1160, 1167 (5th Cir. 1984) (cases cited).

The next effort involved reading a "competitive injury" limitation into the statute. See, e.g., North Barrington Development, Inc. v. Fansiow, 547 F. Supp. 207, 211 (N.D. III. 1980). The Seventh and Eighth Circuits quickly turned this effort aside. Schacht v. Brown, 711 F.2d 1343, 1356-58 (7th Cir.), cert. denied, 464 U.S. 1002 (1983) (the organized crime limitation "revived under ... [a new] guise"); Bennett v. Berg, 685 F.2d 1053, 1058-59 (8th Cir. 1982), aff'd on rehearing en banc, 710 F.2d 1361, cert. denied, 464 U.S. 1008 (1983).

Then the district courts developed the "racketeering injury" limitation. See, e.g., Landmark Savings and Loan v. Rhoades, 527 F. Supp. 206, 208–09 (E.D. Mich. 1981). It was, together with the criminal conviction limitation, a companion effort to circumscribe the plain text and the clear legislative history of RICO. Both limitations, adopted by this Court in sharply divided opinions, were set aside by the Supreme Court in Sedima. "Congress'... [intent is, the Court held,] best determined by the statutory language it chooses. x x x Congressional silence [in the legislative history] ... cannot override the words of the statute." Sedima, 473 U.S. at 495 n. 13.

Since Sedima, the courts, however, have continued "largely unabated" to fashion various devices to circumscribe the scope of Civil RICO. Equitable Relief at 580. Indeed, the dismissal rate remains high at 51.1%. Id. at 620. Nevertheless, the Supreme Court in H.J., Inc., unanimously turned back the effort to use "pattern" to unduly narrow the statute, rejecting the Eighth Circuit's requirement of multiple criminal schemes as proof of a "pattern of racketeering activity." It also squarely refused to narrow the construction of RICO's expansive terms by limiting its reach only to "organized criminal" activity. The Court aptly observed:

As this Court stressed in Sedima, in rejecting a pinched con-
struction of RICO's provision for a private civil action, adopted
by a lower court because it perceived that RICO's use against
non-organized-crime defendants was an "abuse" of the Act,
"Congress wanted to reach both 'legitimate' and 'illegitimate'
enterprises." ... Legitimate businesses "enjoy neither an
inherent incapacity for criminal activity nor immunity from its
consequences"; and, as a result, § 1964(c)'s use "against re-
spected businesses allegedly engaged in a pattern of specifi-
cally identified criminal conduct is hardly a sufficient reason
for assuming that the provision is being misconstrued." ... If
plaintiffs' ability to use RICO against businesses engaged in a
pattern of criminal acts is a defect, we said, it is one "inherent
in the statute as written," and hence beyond our power to cor-
rect....
[R]ewriting [RICO] ... is a job for Congress, if it is
so inclined, and not for this Court. There is no more room in
RICO's "self consciously expansive language and overall
approach" for the the imposition of an organized crime
limitation than for the "amorphous racketeering injury'
requirement" we rejected in Sedima. ... We thus decline the
invitation to invent a rule that RICO's pattern of racketeering
concept requires an allegation and proof of an organized crime
nexus. (citations omitted) 57 U.S.L.W. at 4956.

Here the District Court has merely adopted a different tack to avoid the application of RICO. While conceding, as it must, that RICO violations were properly pled and proven (see Section B(1), infra), the District Court, after contemplating a result

it did not like, strained to find some basis to dismiss the claim. The basis it hit upon was an "implied exception" purportedly justified by the various rationales it mustered. But see Fedorenko v. United States, 449 U.S. 490, 513 (1981) (A court is "not at liberty to

imply condition[s into a] statute.... To [so] hold... is not to construe the

...

...

statute, but to amend it.") (quoting Detroit Trust Co. v. Barlum S.S. Co., 293 U.S. 21, 38 (1934)).

B.

RICO APPLIES TO FRAUD IN RATE MAKING

To determine the scope of RICO, the place to begin is its text. H.J. Inc., 57 U.S.L.W. at 4953 (citing Russello 464 U.S. at 20) (citing Turkette, 452 U.S. at 580).13/ Text includes structure. Sedima, 473 U.S. at 490 n.8; Turkette, 452 U.S. at 587. Ordinary or plain meaning controls. H.J. Inc., 57 U.S.L.W. at 4953 (citing Richards v. United States, 369 U.S. 1, 9 (1962)); Russello, 464 U.S. at 20 (citing Turkette, 452 U.S. at

13/ Four basic assumptions are integral in any principled effort to interpret a statute.

(1)

(2)

(3)

legislative supremacy within the constitutional framework;

the use of the statutory vehicle to exercise that supremacy;
reliance on accepted means of communication; and

reasonable availability of the statutory vehicle to those to be
governed by it, not only its text, but any other part of its legislative
context that serves to give it meaning.

R. Dickerson, The Interpretation and Application of Statutes, 7-12 (1975).
More than 100 years ago, the Supreme Court noted, "It is easy, by very ingenious
and astute construction, to evade the force of almost any statute, where a court is
so disposed... [By such] a construction [it is possible to] annul [it] and [render] it
superfluous and useless." Pillow v. Roberts, 54 U.S. (13 How.) 472, 476 (1851)
(Grier, J.). Such an approach to statutory construction, however, carries with it a
heavy price. After a lifetime of study of the law, Dean Roscoe Pound concluded
that such construction (1) "tend[ed] to bring the law into disrespect; (2) ...
subject[ed] the courts to political pressure; [and] (3) ... invite[d] an arbitrary
personal element in judicial administration." III R. Pound, Jurisprudence 488
(1959). It threatened, he found, to make "laws ... worth little and to "break
down" the "legal order" itself. Id. at 490.

។