Llacua v. Western Range Ass'n

930 F.3d 1161 (2019) United States Court of Appeals for the Tenth Circuit 2019-07-16

civil; H-2A shepherds brought antitrust and class RICO claims against ranching associations and an association officer over false reimbursement assurances to the DOL; district court dismissed the RICO claims under Rule 12(b)(6) for lack of person/enterprise distinctness and denied leave to amend; CA10 affirmed as to the associations, reversed as to the officer (result: mixed)

Facts

  1. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) not pleaded
    WRA and MPAS are membership associations for sheep ranchers. They recruit and hire shepherds for their member ranches.
  2. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) satisfied pleaded
    The corporate owner/employee, a natural person, is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
  3. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) satisfied pleaded
    Brannon and Cedric Kushner make clear that the RICO distinctness requirement is satisfied when a corporate officer, such as Richins in his role as executive director, board member, and president of WRA, is sued as the RICO defendant person and the alleged RICO enterprise is the corporation or association (i.e., WRA).
  4. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) satisfied pleaded
    Thus, the district court erred in determining, as a matter of law, that Richins was not distinct from WRA.
  5. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) not pleaded
    In short, an organization cannot join with its own members to do that which it normally does and thereby form an enterprise separate and apart from itself.
  6. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) not pleaded
    The limited allegations in the SAC merely state that each Association Defendant has formed an association-in-fact with its members, the common purpose of each member of these associations-in-fact is to recruit shepherds at low wages, and that Association Defendants file job orders and H-2A Applications on behalf of their membership.
  7. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) not pleaded
    The SAC further asserts, in entirely conclusory fashion, that the Association Defendants are the "lynchpins" of the alleged associations-in-fact.
  8. 1 Culpable person (§ 1961(3)) distinct from the enterprise under (c) not pleaded
    Based on these limited allegations, this court can perceive no distinction between the alleged RICO persons (WRA and MPAS) and the corresponding RICO enterprises (WRA and its members and MPAS and its members).