United States Court of Appeals for the Second Circuit · 1980-04-04
Case and law context
Role: applied; posture: criminal; appeal from jury conviction on a (c) count (plus securities-fraud, bankruptcy-fraud, conspiracy and obstruction counts); challenges to the RICO jury charge; result: claimant-won; claim: (c)
Instances and excluded annotation blocks
| Case | Element | Holding and scope | Variant | Exact source quotations |
|---|---|---|---|---|
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Defendant employed by or associated with the enterprise (§ 1962(c)) | not_reached Excluded from merits counts applied / merits claim: (c) | Unspecified variant | No source quotation recorded for this block. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Interstate or foreign commerce nexus | not_reached Excluded from merits counts applied / merits claim: (c) | Unspecified variant | No source quotation recorded for this block. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Conduct or participate in the conduct of enterprise affairs (§ 1962(c) operation or management test) | satisfied Counted merits instance applied / merits basis: proved; claim: (c); party: Weisman; subject: party=Weisman The nexus decided is "predicate act committed in the conduct of the enterprise's affairs" (raising its capital), not the later Reves operation/management question. | through-pattern/fraudulent-financing-of-own-company | This pattern emerged in 1973, when Weisman, along with his partners and eventual co-defendants Gregory J. DePalma and Richard Fusco, sought through a fraudulent public offering of common stock to raise over two million dollars for construction of the Theatre.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [1998:2257] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.The procurement of additional funds through the 1973 public offering was thus simply another, admittedly crucial, part of the Theatre’s continuing affairs, and the jury could therefore conclude that the fraud that occurred in connection with the public offering constituted an act of racketeering activity undertaken in the conduct of the Theatre’s affairs.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [20173:20530] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Enterprise (§ 1961(4)): legal entity or association-in-fact | satisfied Counted merits instance applied / merits basis: proved; claim: (c); party: Westchester Premier Theatre (the enterprise); count: the 1973 stock offering, before the Theatre was built or operating; subject: party=Westchester Premier Theatre (the enterprise); count=the 1973 stock offering, before the Theatre was built or operating A corporation in its organizational/financing phase is already an enterprise; (c) does not reach predicate acts committed before the enterprise exists. | legal-entity/corporation-before-business-operations-began | Weisman argues that because the Theatre was not constructed and in operation until 1975, it was not an “enterprise” in 1973 when the acts of securities fraud took place.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [19060:19229] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.For example, after its incorporation in 1971, the Theatre adopted bylaws, secured counsel and hired employees, established offices, sought a construction loan, entered negotiations with a real estate firm for a construction site, and began entering performance contracts with various entertainers.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [19875:20172] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.While that provision is apparently inapplicable to acts of racketeering occurring before the creation or acquisition of an enterprise, we believe that there was sufficient evidence to allow the jury to conclude that an enterprise was in existence well before the acts of securities fraud in 1973.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [19578:19874] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.We reject this view as an overly restrictive interpretation on these facts of the meaning of “enterprise” within the context of that section.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [19436:19577] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Relatedness of predicate acts (horizontal and vertical relatedness) | not_reached Excluded from merits counts rule-announced / merits claim: (c); party: Weisman; subject: party=Weisman Pre-H.J. Inc. rule: no act-to-act relatedness is required; each act need only relate to the enterprise's affairs and fall within ten years. Decided as review of the jury charge (refusal to give the defendant's relatedness instruction upheld): a proposed sub-requirement is rejected, not found satisfied. | relatedness/supplied-by-common-enterprise | The Theatre, from its inception until its collapse, was operated through a wide ranging pattern of fraud.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [1892:1997] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.the statutory language does not expressly require that the predicate acts of racketeering be specifically “related” to each other and we find no affirmative evidence in the legislative history from which we should infer such a requirementSource: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [9856:10094] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Thus, the enterprise itself supplies a significant unifying link between the various predicate acts specified in section 1961(1) that may constitute a “pattern of racketeering activity.”Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [10752:10938] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Accordingly, we find no error in the court’s refusal to adopt Weisman’s extended definition of “pattern” in charging the jury.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [12851:12977] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Relatedness of predicate acts (horizontal and vertical relatedness) | satisfied Excluded from merits counts applied / alternative basis: proved; claim: (c); party: Weisman; theory: act-to-act relatedness, if it were required; subject: party=Weisman; theory=act-to-act relatedness, if it were required Footnote alternative: even under an act-to-act test the 1973 stock fraud and 1976-77 bankruptcy fraud were related (same perpetrator, victims, goal, methods). [proved]: on the trial evidence no jury could have found the acts unrelated. | relatedness/same-perpetrator-victims-goal-and-methods | Weisman was a perpetrator of all of the acts of fraud and all were undertaken during the conduct of the Theatre’s affairs.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [50090:50212] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Furthermore, the acts of stock fraud harmed legitimate investors in the Theatre and many of these same investors were again harmed when the later acts of bankruptcy fraud prevented the Theatre’s financial rehabilitation.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [50213:50433] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.In light of the numerous similarities between the predicate acts of racketeering, we find appellant’s contention that a jury could find that the acts of racketeering activity he engaged in were sporadic and unrelated to be completely untenable.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [50743:50987] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Offense involving fraud connected with a case under title 11 (§ 1961(1)(D)) | satisfied Counted merits instance applied / merits basis: proved; claim: (c); party: Weisman; subject: party=Weisman Each of nine bankruptcy-fraud counts was a distinct episode and a separate predicate act. | bankruptcy-fraud/skimming-receipts-of-debtor-in-possession | The newly constructed Theatre opened in March 1975, at which time Weisman and his confederates systematically began to skim and convert to their own use moneys received by the Theatre from ticket sales and various concessions.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [3120:3346] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Nonetheless, Weisman, DePalma and Fusco, now joined by Cannatella, continued secretly to skim the Theatre’s receipts.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [4046:4163] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Thus, even excluding the conspiracy counts as predicate acts, the convictions for securities fraud and bankruptcy fraud could also constitute ten separate predicate acts of racketeering, any two of which would be sufficient to sustain the conviction on the RICO count.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [16748:17016] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Conspiracy to commit a § 1961(1)(A) or (D) offense charged as a predicate act | satisfied Counted merits instance applied / merits basis: law; claim: (c); party: Weisman; count: § 371 conspiracies to commit securities fraud and bankruptcy fraud; subject: party=Weisman; count=§ 371 conspiracies to commit securities fraud and bankruptcy fraud §371 is not a listed predicate, but (1)(D)'s "any offense involving" fraud reaches conspiracies to commit (D) offenses. Pure question of law raised against the jury charge; the conspiracy convictions themselves were not attacked. | conspiracy-as-predicate/any-offense-involving-1961-1-d | Weisman was convicted of one count of operating the Theatre through a pattern of racketeering activity in violation of 18 U.S.C. §§ 1962(c) and 2, nine counts of fraud in the sale of securities in violation of 15 U.S.C. §§ 77q(a) and 77x and 18 U.S.C. § 2, nine counts of bankruptcy fraud in violation of 18 U.S.C. §§ 152 and 2, one count each of conspiracy to commit securities fraud and bankruptcy fraud in violation of 18 U.S.C. § 371,Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [486:924] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.we think that conspiracy can properly be charged as a predicate act of racketeering under RICO, at least when it involves any of the substantive offenses listed in section 1961(1)(D)Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [14351:14533] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.This language is certainly broad enough on its face to include conspiracies involving securities and bankruptcy fraud and drug related offenses.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [14879:15023] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Conspiracy to commit a § 1961(1)(A) or (D) offense charged as a predicate act | not Excluded from merits counts applied / alternative basis: assumed; claim: (c); party: Weisman; count: § 371 conspiracies to commit securities fraud and bankruptcy fraud; subject: party=Weisman; count=§ 371 conspiracies to commit securities fraud and bankruptcy fraud "Even if" the conspiracies could not be predicates (assumed arguendo), the error in the charge was harmless: the substantive convictions alone gave ten predicate acts. | conspiracy-as-predicate/harmless-if-excluded-substantive-predicates-suffice | Thus, even if the conspiracy counts were excluded, the jury verdict conclusively established a RICO violation and therefore any error in the inclusion of these counts in the RICO charge was harmless.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [17650:17849] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
| /f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980 | Fraud in the sale of securities predicate (§ 1961(1)(D)) | satisfied Excluded from merits counts applied / lower-court basis: proved; claim: (c); party: Weisman; count: 1973 public offering (nine securities counts); subject: party=Weisman; count=1973 public offering (nine securities counts) Nine securities counts from one offering = ONE predicate act (district court's charge, not disturbed). Sufficiency not contested by Weisman. Jury verdict and district-court counting ruling, reported but not reviewed by the panel. | securities-fraud/false-prospectus-and-secret-purchase-arrangements | Weisman and his co-defendants filed with the Securities and Exchange Commission a prospectus that contained false and misleading statements and that failed to disclose material facts, including DePalma’s and Fusco’s role in the project and their beneficial ownership of a large portion of the Theatre’s stock.Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [2258:2567] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.made secret arrangements through which various individuals agreed to purchase stock in the Theatre in return for promises of eventual cash payoffs, transfers of portions of Weis-man’s interest in the Theatre, and other forms of inducement or remunerationSource: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [2783:3037] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.The district court concluded that the specific violations of securities laws charged elsewhere in the indictment could only constitute a single predicate act of racketeering because they arose “out of the same episode.”Source: docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [50990:51209] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed. |
Court interpretations recorded from this case
interpretation
the statutory language does not expressly require that the predicate acts of racketeering be specifically “related” to each other and we find no affirmative evidence in the legislative history from which we should infer such a requirement
/f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980
the statutory language does not expressly require that the predicate acts of racketeering be specifically “related” to each other and we find no affirmative evidence in the legislative history from which we should infer such a requirementSource:
docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [9856:10094] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Under H.J. Inc., predicate acts are related if they have the same or similar purposes, results, participants, victims, or methods of commission, or are interrelated by distinguishing characteristics and are not isolated events; in criminal enterprise cases (Weisman), vertical relatedness to the enterprise's affairs also links disparate predicates.
interpretation
Thus, the enterprise itself supplies a significant unifying link between the various predicate acts specified in section 1961(1) that may constitute a “pattern of racketeering activity.”
/f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980
Thus, the enterprise itself supplies a significant unifying link between the various predicate acts specified in section 1961(1) that may constitute a “pattern of racketeering activity.”Source:
docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [10752:10938] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Under H.J. Inc., predicate acts are related if they have the same or similar purposes, results, participants, victims, or methods of commission, or are interrelated by distinguishing characteristics and are not isolated events; in criminal enterprise cases (Weisman), vertical relatedness to the enterprise's affairs also links disparate predicates.
interpretation
This language is certainly broad enough on its face to include conspiracies involving securities and bankruptcy fraud and drug related offenses.
/f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980
This language is certainly broad enough on its face to include conspiracies involving securities and bankruptcy fraud and drug related offenses.Source:
docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [14879:15023] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Criminal RICO and pre-PSLRA civil RICO include fraud in the sale of securities under § 1961(1)(D); note 18 U.S.C. § 1964(c) (added 1995) bars civil RICO claims relying on conduct actionable as securities fraud absent a criminal conviction.
interpretation
This language is certainly broad enough on its face to include conspiracies involving securities and bankruptcy fraud and drug related offenses.
/f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980
This language is certainly broad enough on its face to include conspiracies involving securities and bankruptcy fraud and drug related offenses.Source:
docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [14879:15023] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Enumerated in § 1961(1)(D) as "any offense involving fraud connected with a case under title 11".
interpretation
we think that conspiracy can properly be charged as a predicate act of racketeering under RICO, at least when it involves any of the substantive offenses listed in section 1961(1)(D)
/f2d/624/1118-01 — United States Court of Appeals for the Second Circuit · 1980
we think that conspiracy can properly be charged as a predicate act of racketeering under RICO, at least when it involves any of the substantive offenses listed in section 1961(1)(D)Source:
docroot/ir/caselaw/f2d_624.jsonl#/f2d/624/1118-01; Unicode character offsets [14351:14533] (end exclusive); SHA-256 9f02652be952ebf06fe5bc7850efdd6237ac4cd8110d7ce9690b75ad54eaa6ed.Distinct from § 1962(d) RICO conspiracy: a conspiracy to commit an offense within § 1961(1)(A) or ("any offense involving...") § 1961(1)(D) can itself count as one of the predicate acts of racketeering.