United States District Court for the Eastern District of Pennsylvania · 2019-04-10
18usc1343: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md); 18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)
Case and law context
Role: applied; posture: civil RICO action (18 U.S.C. § 1962(c)) with wire fraud as predicate; defendants' Rule 12(b)(6) / Rule 9(b) motions to dismiss denied as to the wire-fraud predicate; result: claimant-won; claim:
Uncertainty
Element scheme: holding: the alleged falsity (agreement is an unenforceable usurious loan) rests on the court's assumption "without deciding and only for purposes of the instant motions" that the Factoring Agreement was a loan
Element scheme: other: the court adds that even if wire fraud were not properly alleged the RICO claim would survive on the unchallenged "collection of unlawful debt" theory, so the wire-fraud ruling is one of two independent grounds for denying dismissal of Count IV
Misfit
None recorded
Role: applied; posture: civil; small-business borrower and its guarantors sued a merchant-cash-advance funder and broker under § 1962(c), alleging both a pattern of wire fraud and collection of unlawful (usurious) debt; Rule 12(b)(6) motions denied as to the RICO count (the agreement assumed, for the motions only, to be a loan governed by Texas usury law); result: claimant-won; claim: (c)
Uncertainty
None recorded
Misfit
The unchallenged collection-of-unlawful-debt theory (element debt) and the briefly treated RICO standing rulings (injury: usurious interest paid and lost profits; proximate cause) were also resolved for plaintiffs at the pleading stage and are not recorded as blocks.
B · Case × element grid
Top-level elements follow claim order in panels of up to six elements. Case rows repeat across panels. Every recorded block retains its holding and basis; multiple blocks are not merged into a case-level verdict. ✓ satisfied · ✗ not satisfied · ○ not reached · · not addressed. Muted blocks are not counted. Sub-element evidence remains on case and element pages.
Elements 1–6 of 8
| Case | Scheme or artifice to defraud | Traditional money or property as an object | Material deception | Knowing participation with intent to defraud | Transmission or causation by wire, radio, television | Wire transmission for execution of scheme |
|---|---|---|---|---|---|---|
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 (18usc1343: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | · not addressed | · not addressed | · not addressed | · not addressed |
Elements 7–8 of 8
| Case | Interstate or foreign transmission | Separate section 1346 theory; outside property-fraud claim |
|---|---|---|
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 (18usc1343: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | · not addressed | · not addressed |
B · Case × element grid
Top-level elements follow claim order in panels of up to six elements. Case rows repeat across panels. Every recorded block retains its holding and basis; multiple blocks are not merged into a case-level verdict. ✓ satisfied · ✗ not satisfied · ○ not reached · · not addressed. Muted blocks are not counted. Sub-element evidence remains on case and element pages.
Elements 1–6 of 19
| Case | Culpable person (§ 1961(3)) distinct from the enterprise under (c) | Pattern of racketeering activity (§ 1961(5)): at least two predicate acts with relatedness and continuity | Racketeering activity (§ 1961(1) enumerated state and federal predicate offenses) | Collection of an unlawful debt (§ 1961(6)) — alternative to pattern of racketeering activity | Use or investment of racketeering income in an enterprise (§ 1962(a)) | Enterprise (§ 1961(4)): legal entity or association-in-fact |
|---|---|---|---|---|---|---|
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 (18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | · not addressed | · not addressed | · not addressed | · not addressed | · not addressed |
Elements 7–12 of 19
| Case | Interstate or foreign commerce nexus | De minimis open-market securities investment proviso (§ 1962(a)) | Acquire or maintain interest in or control of an enterprise (§ 1962(b)) | Defendant employed by or associated with the enterprise (§ 1962(c)) | Conduct or participate in the conduct of enterprise affairs (§ 1962(c) operation or management test) | Conspiracy to violate § 1962(a), (b), or (c) (§ 1962(d)) |
|---|---|---|---|---|---|---|
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 (18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | · not addressed | · not addressed | · not addressed | · not addressed | · not addressed | · not addressed |
Elements 13–18 of 19
| Case | Civil RICO injury to business or property (18 U.S.C. § 1964(c)) | But-for and proximate causation ("by reason of", 18 U.S.C. § 1964(c)) | Statute of limitations (4-year civil under Agency Holding; 5-year criminal under 18 U.S.C. § 3282) | Claim preclusion / release by prior class-action settlement | Civil aiding and abetting a RICO violation (rejected as a private cause of action) | Fifth Amendment Double Jeopardy bar against successive RICO conspiracy/substantive prosecutions |
|---|---|---|---|---|---|---|
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 (18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | · not addressed | · not addressed | · not addressed | · not addressed | · not addressed | · not addressed |
Elements 19–19 of 19
| Case | Parol evidence rule raised to bar extrinsic evidence of fraudulent misrepresentations |
|---|---|
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 (18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | · not addressed |
Instances and excluded annotation blocks
| Case | Element | Holding and scope | Pattern | Exact source quotations |
|---|---|---|---|---|
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 — satisfied · pleaded (18usc1343: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md); 18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Scheme or artifice to defraud | satisfied Counted merits instance applied / merits basis: pleaded; party: Complete Business Solutions Group, Inc. (CBSG) and Prime Time Funding, LLC (PTF); count: civil RICO (Count IV), wire fraud as the predicate racketeering activity; subject: party=Complete Business Solutions Group, Inc. (CBSG) and Prime Time Funding, LLC (PTF); count=civil RICO (Count IV), wire fraud as the predicate racketeering activity The only challenge to the predicate was Rule 9(b) particularity; the court held the scheme (luring borrowers into loans falsely presented as enforceable) pleaded with enough particularity. No substantive sub-question of "scheme" was decided, hence route _pleading. | lender misrepresents enforceability of a usurious merchant-cash-advance "factoring" agreement; Rule 9(b) who-to-whom-and-what satisfied | "Mail or wire fraud consists of (1) a scheme to defraud, (2) use of the mail or interstate wires to further that scheme, and (3) fraudulent intent."Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [26738:26886] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.Nevertheless, a plaintiff "must allege who made a misrepresentation to whom and the general content of the misrepresentation."Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [28955:29081] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.At its core, the Amended Complaint alleges the Defendants engaged in a scheme to defraud by intentionally misrepresenting the enforceability of the Factoring Agreement, when, in fact, the Factoring Agreement was a usurious, and thus unenforceable, loan.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [27056:27309] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.As evidence, Plaintiffs allege the existence of (but have not actually filed with the Court) two email exchanges between Plaintiffs, PTF, and CBSG, in January 2017, in which Defendants fraudulently (1) claimed the Agreement would help move Fleetwood Services away from cash advances and save money, and (2) the Agreement was legally enforceable.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [27310:27655] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.Defendants' promises, according to the Amended Complaint, were lies manufactured to conceal the true purpose behind CBSG and PTF's offer, which was to "worsen [ ] Fleetwood Services's cash flow and thereby increase its dependence on further loans exclusively from [ ] CBSG."Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [2500:2774] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.The Court is satisfied Plaintiffs have alleged "who made a misrepresentation to whom and the general content of that misrepresentation," Lum , 361 F.3d at 224, and that the Amended Complaint suffices to put Defendants on the notice of the "precise misconduct with which they are charged," Seville , 742 F.2d at 791.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [30108:30423] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db. |
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 — satisfied · pleaded (18usc1343: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md); 18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Transmission or causation by wire, radio, television | satisfied Counted merits instance applied / merits basis: pleaded; party: Complete Business Solutions Group, Inc. (CBSG) and Prime Time Funding, LLC (PTF); count: civil RICO (Count IV), wire fraud as the predicate racketeering activity; subject: party=Complete Business Solutions Group, Inc. (CBSG) and Prime Time Funding, LLC (PTF); count=civil RICO (Count IV), wire fraud as the predicate racketeering activity Use of the wires held adequately pleaded under Rule 9(b) by the alleged January 2017 email exchanges (alleged, not filed) and the ACH debits. The court's sentence also covers furtherance; no separate furtherance analysis. | January 2017 emails and daily ACH debits from borrower's Texas bank accounts | In further support of its claim, Plaintiffs allege Defendants' use of the interstate wires to electronically debit its bank account "further created the impression" the Factoring Agreement was enforceable, and once Fleetwood Services experienced issues making payments, Defendants used emails and other wire communications to bolster this impression.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [27656:28006] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.The Factoring Agreement obligated Fleetwood Services to repay the Receipts Purchased Amount in 110 daily installments of $ 5,000.25, which were effectuated by electronic automated clearing house debits from Fleetwood Services's Texas-based bank accounts.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [4686:4940] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.(2) the use of the wires (i.e., January, 2017, emails and ACH debits between Defendants and Fleetwood Services furthering the false impression of the enforceability of the unenforceable agreements) to further the schemeSource: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [30662:30881] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db. |
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 — satisfied · pleaded (18usc1343: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md); 18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Enterprise (§ 1961(4)): legal entity or association-in-fact | satisfied Counted merits instance applied / merits basis: pleaded; claim: (c); party: CBSG and PTF (moving defendants: the funder/servicer and the broker); count: Count IV, civil RICO § 1962(c); theory: association-in-fact "Lending Enterprise" of Doe investors, broker PTF and funder/servicer CBSG; subject: party=CBSG and PTF (moving defendants: the funder/servicer and the broker); count=Count IV, civil RICO § 1962(c); theory=association-in-fact "Lending Enterprise" of Doe investors, broker PTF and funder/servicer CBSG Association-in-fact enterprise adequately pleaded under both Turkette and Boyle; the court also rejected the argument that providers of "routine credit services" fall outside RICO enterprises. | investors supply capital, a broker originates and a funder services usurious merchant cash advances | PTF and CBSG, along with the unidentified Investor Defendants, work together to fund, originate, underwrite, and service loans, which, like their consumer analogs, feature exorbitant annualized interest rates.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [1444:1653] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.there were relationships between each of the members (the John and Jane Does provided the capital, PTF brokered the loans, and CBSG serviced them), and sufficient longevity (from at least 2015) to accomplish that purposeSource: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [25040:25260] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.Rather, the Amended Complaint explains how they each worked together in this scheme to originate, underwrite, and service loans with illegal interest rates.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [24427:24583] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.Here, Plaintiffs allege the existence of an "association-in-fact" enterprise, which requires its own three-part showing: "(1) there exists an ongoing organization, formal or informal; (2) the various associates of the organization function as a continuing unit; and (3) the organization has an existence separate and apart from the alleged pattern of racketeering activity."Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [22447:22821] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.The Court finds the Amended Complaint satisfies both Turkette and Boyle at this stage.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [23355:23441] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db. |
| Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 — satisfied · pleaded (18usc1343: author: Flash3 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md); 18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Mail or wire fraud predicate (18 U.S.C. §§ 1341, 1343) | satisfied Counted merits instance applied / merits basis: pleaded; claim: (c); party: CBSG and PTF (moving defendants: the funder/servicer and the broker); count: Count IV, civil RICO § 1962(c); theory: wire fraud by misrepresenting a usurious loan as an enforceable factoring agreement; subject: party=CBSG and PTF (moving defendants: the funder/servicer and the broker); count=Count IV, civil RICO § 1962(c); theory=wire fraud by misrepresenting a usurious loan as an enforceable factoring agreement Added in triage. Wire-fraud predicates survive a Rule 9(b) particularity challenge. The court adds that the count would survive anyway on the unchallenged collection-of-unlawful-debt theory. | emails and ACH debits said to create the false impression that a usurious cash-advance agreement was enforceable | At its core, the Amended Complaint alleges the Defendants engaged in a scheme to defraud by intentionally misrepresenting the enforceability of the Factoring Agreement, when, in fact, the Factoring Agreement was a usurious, and thus unenforceable, loan.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [27056:27309] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.In further support of its claim, Plaintiffs allege Defendants' use of the interstate wires to electronically debit its bank account "further created the impression" the Factoring Agreement was enforceable, and once Fleetwood Services experienced issues making payments, Defendants used emails and other wire communications to bolster this impression.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [27656:28006] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.Nevertheless, a plaintiff "must allege who made a misrepresentation to whom and the general content of the misrepresentation."Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [28955:29081] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.As a result, the Court will deny Defendants' motion to dismiss on this ground.Source: docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [30986:31064] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db. |
Court interpretations recorded from this case
interpretation
Here, Plaintiffs allege the existence of an "association-in-fact" enterprise, which requires its own three-part showing: "(1) there exists an ongoing organization, formal or informal; (2) the various associates of the organization function as a continuing unit; and (3) the organization has an existence separate and apart from the alleged pattern of racketeering activity.
Fleetwood Servs., LLC v. Complete Bus. Solutions Grp., Inc. — 374 F. Supp. 3d 361 (2019) · United States District Court for the Eastern District of Pennsylvania · 2019 (18usc1962: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md))
Here, Plaintiffs allege the existence of an "association-in-fact" enterprise, which requires its own three-part showing: "(1) there exists an ongoing organization, formal or informal; (2) the various associates of the organization function as a continuing unit; and (3) the organization has an existence separate and apart from the alleged pattern of racketeering activity.Source:
docroot/ir/caselaw/f_supp_3d_374.jsonl#/f-supp-3d/374/0361-01; Unicode character offsets [22447:22820] (end exclusive); SHA-256 c041cf6cf58e2814a8ec0b0d635cfd00b5b7a557d2adb7ffa3eb21670f1c22db.Turkette and Boyle govern association-in-fact enterprises: purpose + relationships among associates + longevity sufficient to pursue the purpose.