Crest Construction II, Inc. v. Doe

660 F.3d 346 (2011) United States Court of Appeals for the Eighth Circuit 2011-10-31

civil; investor/financier sues used-car dealer, its owners and affiliated companies; RICO count dismissed under 12(b)(6)/9(b), leave to amend denied, state claims declined; plaintiffs appeal; affirmed (result: claimant-lost)

Facts

  1. 2 Enterprise (§ 1961(4)): legal entity or association-in-fact not pleaded
    The complaint broadly and nonspecifically alleges Defendants formed and operated an “association in fact” that fraudulently grew a “web of interrelated” commonly-owned and managed companies that engaged in a host of “fraudulent and illegal” business practices, including mail and wire fraud, and used this association in fact to fraudulently induce Plaintiffs to purchase third-party vehicle loan accounts from On Time Auto and to purchase — then lose — an equity interest in On Time Auto.
  2. 2 Enterprise (§ 1961(4)): legal entity or association-in-fact not pleaded
    The complaint further asserts that Defendants used On Time Auto as a front to maximize and divert the revenues and profits of the illegal enterprise
  3. 2 Enterprise (§ 1961(4)): legal entity or association-in-fact not pleaded
    The district court found Plaintiffs failed to properly plead the RICO elements of an enterprise, a pattern of racketeering activity, and at least two predicate acts committed by each defendant. We agree.
  4. 2 Enterprise (§ 1961(4)): legal entity or association-in-fact not pleaded
    In deciding whether an alleged RICO enterprise has an ascertainable structure distinct from the pattern of racketeering activity, we must “determine if the enterprise would still exist were the predicate acts removed from the equation.”
  5. 2 Enterprise (§ 1961(4)): legal entity or association-in-fact not pleaded
    we note that these assertions are more of the same eonclusory allegations that altogether fail to establish how the Defendants are associated with each other or the RICO enterprise.
  6. 2 Enterprise (§ 1961(4)): legal entity or association-in-fact not pleaded
    In their complaint, Plaintiffs merely suggest that at indefinite times, in nondescript ways, and for unidentified purposes, some, but not all Defendants provided On Time Auto with funds or services.