# Amicus Curiae Brief — Hj Inc. v. Northwestern Bell Telephone Co. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0643%3A10 ## Record - **Collection:** Supreme Court brief - **Document type:** Amicus Curiae Brief - **Published:** January 1, 1989 - **Citation:** 492 U.S. 229 ## Text *” Byreome Court, U.S. Fit &D MAY 18 1968 _ SPAMIGL, & CLERK No. 87-1252 In The Supreme Court of the United States October Term, 1987 0 H.J., INC., a Minnesota corporation, KIRK DAHL, LAR- RY KRUGEN and MARY KRUGEN, individually and d/b/a PHOTO IMAGES, SUSAN DAVIS, ROBERT NEAL, ISAAC F. WARD, RICHARD L. ANDERSON, THOMAS J. MOTT, and all others similarly situated, Petitioners, NORTHWESTERN BELL TELEPHONE COMPANY, a subsidiary of US. WEST, A. B. C. individually and D. EK. F. as corporations, and other unnamed Co-con- spirators, Respondents. ray Vv On Writ of Certiorari to the Court of Appeals for tue Eighth Circuit ty a * J BRIEF FOR AMICI CURIAE IN SUPPORT OF RESPONDENT -O Rosert K. Corps Attorney General State of Arizona 1275 West Washington Phoenix, Arizona 85007 602-255-4256 COCKLE LAW BRIEF PRINTING CO., (800) 225-6964 or call collect (402) 342-2831 HONORABLE JOHN STEVEN CLARK Attorney General of the State of California HONORABLE JOHN J. KELLY Chief State’s Attorney, Connecticut HONORABLE JIM JONES Attorney General of the State of Idaho HONORABLE FRANK J. KELLEY Attorney General of the State of Michigan HONORABLE W. CARY EDWARDS Attorney General of the State of New Jersey HONORABLE HAL STRATTON Attorney General of the State of New Mexico HONORABLE LACY HH. THORNBURG Attorney General of the State of North Carolina HONORABLE JEAN A. BENOY Senior Deputy Attorney General of North Carolina HONORABLE DAVE FROHNMAYER Attorney General of the State of Oregon HONORABLE JIM MATTON Attorney General of the State of Texas HONORABLE KENNETIL ©. EIKENBERRY Attorney General of the State of Washington HONORABLE CHARLIE BROWN Attorney General of the State of West Virginia HONORABLE DONALD J. HANAWAY Attorney General of the State of Wiseonsin HONORABLE JOSEPH B. MEYER Attorney General of the State of Wyoming TABLE OF CONTENTS SUMMARY OF ARGUMENT C'S ARGUMENT 1. “PATTERN” IS ESTABLISHED WHERE ACTS ARE RELATED AND MANIFEST OR POSE A THREAT OF CONTINUITY WITH- OUT REGARD TO THE PRESENCE OF MUL- ee 6 Il. PATTERN UNDER STATE LAW IS AN IN- DEPENDENT QUESTION 15 APPENDIX il TABLE OF AUTHORITIES Page(s) Unitep States Supreme Court CasEs: Detroit Trust Co. v. The Thomas Barlum, 293 US. 21 (1984) 4 Fedorenko v. United States, 449 U.S. 490 (1981) ........ 4 Helvering v. Morgan’s Inc., 293 U.S. 121 (1934) 9 Indian Towing Co. v. United States, 350 U.S. 61 |; ) eee 24 Nash v. United States, 229 U.S. 373 (1913) ..cccccccceceeoeenee 10 Oklahoma City v. Tuttle, 471 U.S. 808 (1985) 00... 15 Patsy v. Florida Board of Regents, 457 U.S. 496 CO renee nico 23 Pillow v. Roberts, 54 U.S. (13 How.) 472 (1851)... 4 Russello v. United States, 464 U.S. 16 (1983) .... 6,9, 10, 12 Sedima S.P.R.L. v. Imrex Co., 473 U.S. 479 (1985) passim United States v. Bailey, 444 U.S. 394 (1980) . wae 13 United States v. Turkette, 452 U.S. 576 (1981) ........6, 9,10, 12,18 Oruer Freprerat CAsEs: Bank of American National Trust & Savings Ass’n v. Touche Ross Co., 782 F.2d 966 (11th Cir. 1986) ... 8 Bartecheck v. Fidelity Union Bank/First National State Bank, 832 F.2d 36 (3d Cir. 1987) ccc 8 Beck v. Manufacturers Hanover Trust Co., 820 F.2d 46 (2d Cir. 1987) . eerste cee a. Behunin v. Dow Chemical Co., 650 F. peat 1387 CTS Cai, TD aie chicane 4,17,18 Cabbell v. United States, 636 F.2d 246 (8th Cir. ee EF Nt ill TABLE OF AUTHORITIES—Continued Page(s) California Architectural Bldg. Products, Ine. v. Franciscan Ceramics, Inc., 818 F.2d 1466 (9th einem HN ie 4 ds Ae ohn 8 City of New York v. Joseph L. Balkan, Ine., 656 F. cape. S56 (E.DN.Y. 1967) 14 Cook v. Zions First Nat’ used 645 F. Supp. 423 (D.C. Utah 1986) oo ol SE Elliott v. c te Motor Club Ins., 809 F.2d 347 (7th Cir. 1987) . IIE nitro tmemehaicieisian anne Furman vy. Cirrito, 828 F.2d 898 (2d ( Cir. 1987) Ro 8 Garbade v. Great Divide a & Millin e g Corp., 831 F.2d 212 (10th Cir. 1987) . eeu , ae Henry v. Farmers City State Bank, 808 F.2d 1228 (7th Cir. 1986) . lecanad elsesintedemeind(- ae HMK Corp. v. W wee 28 F.2d 1071 coh Cir. In Re Dow Co. SaraBond Products Liability, 666 I’. Supp. 1466 (D.C. Colo. 1987) | " 18 J.G. Williams v. Regeney a Ltd., 672 F. Supp. 1436 (N.D. Ga. 1987) . eiemldinialeminimation: Lipin Enterprises, Ine. v. _— 803 F.2d 322 bites 2 ee LR Liquid Air sain v. Rogers 834 F.2d 1297 (7th Cir. 1987) . dae oe 2 aT eh 14 Louisiana Power & Light Co. v. United Gas Pipe Line Co., 642 I. Supp. 781 (E.D. La. 1986) .. —_ oe Madden v. Gluek, 815 F.2d 116 (8th Cir. 1987) 8 Marshall-Silver Construction Co., Ine. v. Mend 835 F.2d 63 (3d Cir. 1987) Gateckahiednentied —_ oneieiathe 14 iv TABLE OF AUTHORITIES—Continned Page(s) Michelson v. Merrill Lynch Pierce Fenner & Smith, 669 F. Supp. 1244 (S.DIN.LY. D987) centers + Montesano v. SeaFirst Commercial Corp., 818 F.2d QDS (Btn Cire, 1987) icc.ccecceccncennenseevncoeevecneenernernenernensonnnnonnnnn 8,21 Morgan v. Bank of Waukegan, 804 F.2d 970 (7th | i 8,10, 11,13 Paul S. Mullin & Assoc., Inc. v. Bassett, 632 F. Supp. 582 (D. Del. 1986) ee a Plains Resources, Ine. v. Gable, 782 F.2d 883 (10th Oe ac eecieeeencteerseeicevenseinionnenre preteen 4 Plains Resources, Ine. v. Gable, Civil No. 83-JM- 2145 (D. Colo. 1984) . ae Poling v. Morgan, 829 F.2d 882 (9th Cir. 1987) .................. 16 Roeder v. Alpha Indus., Inc., 814 F.2d 2 vse | ae ' ee a Saine v. A.LA., Ine., 582 F. ee 1299 9 (D.C. Colo. an ai anne ER aN ane ee Ea rem nO 19 Schnitzer v. Oppenheimer, 633 F. ee 92 — C. Ore. 1985) 0. ee “ iti 6 Schreiber Distrib. Co. v. Serv-Well Furniture (o.. Ine., 806 F.2d 1393 (Oth Cir. 1986) essen 11 Sun Savings & Loan Ass’n v. Dierdorff, 825 F.2d EN ED. | eae See ee 8,14 Superior Oil v. Fulmer, 785 F.2d 252 (8th Cir. 1986) .....8, 12 Tarrant v. Ponte, 751 F.2d 459 (1st Cir. 1985) 19 Thomas v. Myers-Diekson Furniture Co., 479 F.2d 740 (5th Cir. 1979) .. i aukimaandamaid se aakaaeas ae United States v. Calabrese, 645 F.2d 1379 (10th Vv TABLE OF AUTHORITIES—Continued Page(s) United States v. © 706 F.2d 1322 1983) ; ( (5th Cir. United States v. Elliott, 571 F.2d 880 (5th Cir. 1978) 17 United States v. Ianniello, 808 F.2d 184 (2d Cir. I cee et) Peat taki ee ee 8,11, 12, 13 United States v. lLron Workers Local 86, 443 F.2 544 (9th Cir.) ceoosaian ES Fae antven i a Ah a ae ) 15 United States v. Joseph, 781 F.2d 549 (6th Cir. Ee A ele ec ae Oe Sheol 13 United States v. Moeller, 402 F. tl 49 (D.C. RII Siete Bt ee Te 17, 20 United States v. Parness, 503 F.2d 430 (2d Cir. 1974). 17 United States v. Qaond, 777 F.2d 1 =ron “a r 105 (6th Cir. United States v. Starnes, 644 F.2d 673 (7th Cir.) ......... 17 United States v. Stofsky, 409 F. S 609 { auY. tor) upp. 609 (D.C. ERAN PME I, 2 i ise nler e 17 United States v. Weathersno 581 F.2d A 7 ae cancel oe on 17 United States v. Weisman, 624 F.2 a Cir. 1980) _.. ee ischial cm 17 STATE CAsEs: Arizona ex rel. Corbin v. Pickrell, 186 Ari 667 P.2d 1304 (1983) ee 2, 3, 23 Baines v. Superior Court, 688 P.2d 10 Ct. App. 1984) ianiesintun Banderas v. Banco Central del Eeuado if ’ yi rT. 46 1 S.2 265 (Fla. Dist. Ct. App. 1985) : vi TABLE OF AUTHORITIES—Continued Page(s) Boise-Payette Lumber Co. v. Siac 295 P.2d 791 (Colo. 1930) . catalan Carlson v. State, 405 S.2d 173 (Fla. 1981) ... Dombalion v. Fox, 88 Cal.App.3d 763, 765-67, 152 Cal. Rptr. 86, 87-88 (Ct. App., Div. 1, 1979) ......... 21 Dorsey v. State, 402 S.2d 1178 (Fla. 1981) 2 Hoen v. District Court in and for the County of Arap, 412 P.2d 428 (Colo. 1966) nn. .ccccennnneennnenenmmnnnn 3 In Re args < Estate, 170 Wash. 280, 16 P.2d 433 Jensen v. Intermountain Health Care, Inec., 679 P.2d 903 (Utah 1984) . Pot CME, re Oe eT Moorehead v. State, 383 S.2d 629 (Fla. 1980) 2000. 2,8 People v. Wahl, 716 P.2d 123 (Colo. 1986) 3 People v. W — Poker Club, 509 P.2d 324 I SIT > cscscamsysasilociiimsintainis or Sw Roash v. State, 413 S.2d 15 5 (Fle. ees as RE ae 2 State v. Whiddon, 384 S.2d 1269 (Fla. 1980) .0000. 2 . Feperat STATUTES AND REGULATIONS: ke a Le CI IIIS, cicunticesinallsinsiSahiaen TCE Ler 9, 29 IIIT, SIR, snconcinnnislalssienies me 18 U.S.C. § 1962(b) : 9, 12 OE Se ees ne ee 9,12 18 U.S.C. § 1962(d) . 12 vii TABLE OF AUTHORITIES—Continued Page(s) Svs... tae tttststsSS . 7 42 U.S.C. § 1983 (1982) Od 84 Stat. 947 (1970) i (sis? FrperaL Leaisative History: 110 Cong. Ree. 14270 (1970) - 116 Cong. Ree. 35,204 (1970) detainee cata 18 S. Rep. No. 91-617, 91st Cong., Ist Sess. 158 (1964) 11, 12,13 State Statutes anp Recu.ations: 18 Pa. Cons. Stat. 6 911(h) (Pardon 1983) 16, 20, 22 Colo. Rev. Stat. § 18-17-103 (Supp. 1984) 18, 19, 22, 23 Conn. Gen. Stat. Ann. § 53-394 (West Supp. 1984) _.22, 23 Del. Code Ann., Title 11, § 1502 STUIIIID cenininsianeeenendesiata 21, 23 Fla. Stat. Ann., § 772.02(4) (1986) 21 Fla. Stat. Ann., § 772.02 (1986) slaeeadibeiebdeaisieebbatetasieeed se , BB Ga. Code Ann, § 16-14-3 (1983) 0 si Hawaii Rev. Stat. §842 (1976) 16 Idaho Code § 18-7803 (1981) 23 ag a 56-Y2 oo _— on om Ind. Code Ann. § 35-45-6-1 isin Supp. 1982) .. | _s La. Rey. Stat. § 15-1351 (West 1985) 23 Miss. Code Ann. § 97-43-1-3 (Lawyers Co-op 1986): N.C. Gen. Stat. §75 D-3 (1986). 23 Vill TABLE OF AUTHORITIES—Continued Page(s) N.D. Century Code § 12.1-06.1 (Smith Supp. 1983) ....... 16 N.J. Stat. Ann. § 2C :416.2 (West Supp. 1982) ............. 16, 23 N.M. Stat. Ann. § 30-42-1-3 (Michie Supp. 1980) ..... 21, 23 N.Y. Crim. Proc., § 40.10(2) (1985) nenccnccxcccoeerceeeee 21, 22, 23 N.Y. Penal Cocde, § 460.10 (1986) nn eneceeeeenceersnennennennnnnen 20, 21 Nev. Rev. Stat. 6 207.380 (1963) —_—_________- 16, 23 Ohio Rev. C —, § en ee 16, 21, 23 Ore. Rev. Code Ann, § 166.715 (1983) nn ccenenenenennrnn 22 Utah Code Ann. § 76-10-1602 (Smith Supp. 1985) ........ 20, 23 Wash. Rev. Code Ann., names 82.010 sao — i SUED’ stansncteeenendalae 20, 22, 23 Wis. Stat. Ann. § 946.82 (West ilies 1984-85) 16, 21, 22, 23 Books aNxp OTHER Sources: 1 E. Livingston, Complete Works on Criminal - Jurisprudence 231 (1873 ede) nn ncnec.ccncnnnnnnennnnnmennnn A.B.A. Criminal Justice Section, Comprehensive Perspective on Civil and Criminal RICO Leg- islation and Litigation: A Report of the RICO Cases Cornmmittec BO-B7 ( UGGB) nnnnnnncaanenan ccc csceece sesesesevnncenennees 11 ‘ivil Blakey and Cessar, Equitable Relief under Civi . RICO, 62 Notre Dame L. Rev. 526 (1987) —........ 2,8 Blakey and Gettings, Racketeer Influenced and Corrupt Organizations (RICO): Basie Concepts Criminal and Civil Remedies, 53 Temple L. e. 0 ees a eel ee ee nonin i Blakey, The RICO Civil Action in Context, 58 Notre Dame L. Rev. 237 (1982) —...... pa ee a ae 4) ix TABLE OF AUTHORITIES—Continued Page(s) C. Wright & A. nil Federal Practice and Pro- cedure § 104 (1969) | hckaeniodih aah oe D. Wigdor, Roscoe Pound: Philosopher o of Law 174 (1974) .. i aaieaaaene Gpiieiinemiaees: ae E. Patterson, Sarigpraence: Men and Ideas of the Law 421 (1953) ne Ae Le Se Goldsmith, RICO and aii, ea gnepciens lt 88 oS Re ee 7 Horn, Judicial Plague Sweeps United States Re- sultorientitis’ Infects Civil RICO ee 5 Nat'l L. J. May 23, 1983 . ec edieniaseioeniemnanaihaddcas 20 a Il R. Pound, iliaieiliniea 124-29 (1959) _..._._.._.10, 24 III The Oxford English Dictionary 315 ( 1933) caaidiaiens 10 J. Hurst, The Growth of American Law 186 (1950) L. Wittgenstein, shcsundectauanasin Inv isn casera 20 (2d RN GR cette 10 Reconsideration of Pattern in Civil RICO Of- fenses, 62 Notre Dame L. Rev. 99 er 8 RICO Revisited: An Advanced Seminar on the Latest Techniques in Civil Suits, 157 (1987) 10 The Code of Criminal Procedure of the State of New York 470-71 (1850 ed) See 18 The Code of Penal Law 5 (1865 ed.) - ceasiinmeinadiaiilis? United States Attorney’s Manual, Title 9—Crijp. inal Division § 9.110.340 Sekdemdaie ae 17, 20 V The Oxford English Dictionary 152 (19383) 20 VII The Oxford English Dictionary 565-66 ( 1933)... 10 XI The Oxford English Dictionary 251 (1933) 21 No. 87-1252 EE Vv In The Supreme Court of the United States October Term, 1987 nn _— H.J., INC., a Minnesota corporation, KIRK DAHL, LAR- RY KRUGEN and MARY KRUGEN, individually and d/b/a PHOTO IMAGES, SUSAN DAVIS, ROBERT NEAL, ISAAC F. WARD, RICHARD L. ANDERSON, THOMAS J. MOTT, and all others similarly situated, Petitioners, NORTHWESTERN BELL TELEPHONE COMPANY, a subsidiary of U.S. WEST, A. B. C. individually and D. KE. F. as corporations, and other unnamed Co-con- spirators, Respondents. ff. A On Writ of Certiorari to the Court of Appeals for the Eighth Circuit tt. a BRIEF FOR AMICI CURIAE IN SUPPORT OF RESPONDENT INTEREST OF AMICI CURIAE This brief is submitted on behalf of the States of Arizona, California, Connecticut, Idaho, Michigan, New Jersey, New Mexico, North Carolina, Oregon, Texas, Wash invton, West Virginia, Wisconsin, and Wyoming.® In 1970, Congress enacted the Organized Crime Con- trol Aet, Tithe LX of which is known as “RICO” IS USC. *« 1961-68 (1982). Since then, twenty-seven states, inelud- “se Arizona, have followed Congress’ lead by adopting similar, but not identical legislation.' These states nave employed this legislation in criminal prosecutions agaist a wide variety of illegal conduet.? Both state governments and private plaintiffs have also utilized state RICO legis- lation in civil litigation.’ Although these states adagtes levislation analogous to, but different from, Tithe IX, ed- eral RICO plays a vital role in interpreting the state statutes.’ , this brief of Pro- * The assistance in the preparation of fessor G. Robert Blakey, O'Neill Protessor of Law, Notre ors Law School, Jenmter Ann Walecki (Notre Dame ‘89) and Josep P Shannon (Notre Dame '88) is hereby ac knowledged. ‘ror a detailed comparative analysis of the Federal and -— lecistation, see Blakey and Cessar, Equitable Reliet under Civi RICO 62 Notre Dame Lt. Rev. 526, 596 (1987) (hereinafter Equitable Relet) see, eg, Carlon v. State, 405 S.2d 173, 74 (Fla. = (house of all tame); Dorsey v State, 402 S.2d 7S, 1180 bt 1O81) (dewes): State vo Whiddon, 384 S 2d 1269, 1270 wats Mee ) (heit. burglary, arson and arson to defraud); Moorehead v. State. 445.2 629, 630-31 (Fla, 1980) (auto thett), ‘See, eg, Arizona ex rel. Corbin v. Pic krell, 136 Ariz. 589, 591 66” Pld 1304, 1306 (1983) (securities fraud) ; Banderas Vv. Banco Central del Ecuador, 461 §.2d 265 (Fla. Dist. Ct. App. 1985) (lorenzn exchange traud). ‘See, @@ Baines v. Superior Court, 688 P.2d 1037, 1040 (Ariz. Ct. App. 1984) (‘film the absence of any Arizona Cases, we will look to federal decisional law tor guidance’); Roash (Continued on tollowing page) 3 Distressingly, however, decisions by lower l'ederal courts demonstrate a distinct hostility toward the use of civil RICO! State RICO defendants use the decisions of the Federal courts to challenge state legislation in an attempt to narrow improperly the seope of the indepen- dent state statutes.© In the context of Federal litigation (Continued from previous page) v. State, 413 $.2d 15, 20-21 (Fla. 1982) (constitutionality of RICO- type civil remedies upheld relying on Federal decisions) ; Moore- head, 383 $.2d at 630-31 (constitutionality of “pattern” in Flori- da RICO statute upheld relying on Federa! decisions). The jurisprudence that directs this course of interpretation is familiar. It is reflected, for example, in the law of Colorado. When the General Assembly adopts “substantially” the provi- sions of an act from another jurisdiction, it “is presumed to have intended that such statute should receive by the |Colorado| courts . . . the same construction given it by the courts of [the other jurisdiction] prior to its adoption... .” Hoen v. District Court in and for the County of Arap, 412 P.2d 428, 431 (Colo. 1966). Subsequent decisions are of “persuasive value only.” Boise-Payette Lumber Co. v. Longwedel, 295 P.2d 791, 792 (Colo. 1930). Similar language is to be read similarly. People v. Wahl, 716 P.2d 123, 128 (Colo. 1986). But where “the Colorado ap- proach is significantly different,” limitations found in the “model act” should not be read into Colorado legislation. People v. Wheatridge Poker Club, 509 P.2d 324, 327 (Colo. 1977). Colo- rado’s jurisprudence reflects general jurisprudence. See, e.g., Jensen v. Intermountain Health Care, Inc., 679 P.2d 903, 904-05 (Utah 1984); In Re Eaton's Estate, 170 Wash. 280, 281, 16 P.2d 433, 434 (1932). *See generally, Horn, Judicial Plague Sweeps United States Resultorientitis’ Infects Civil RICO Decisions, 5 Nat'l J. May 23, 1983, at 31, col. 1. Indeed, prior to this Court’s decision in Sedima S.P.R.L. v. Imrex Co., 473 U.S. 479 (1985), sixty-one per cent of the reported civil RICO decisions were dismissed on motions of the defendants. Fquitable Relief at 534. Since Sedima, the dismissal rate has been fifty-one percent; forty percent of therm have relied on “pattern” grounds. Id. at 620. See infra n.29. *See, e.g, Arizona ex rel. Corbin, 136 Ariz. at 596. 667 P.2d at 1311 (distinct injury limitation rejected, but urged based on (Continued on following page) 4 with pendent state claims, Federal courts are also unjusti- fiably reading limitations into state legislation not sup- ported by the text or appropriate policy considerations, thus frustrating the particular designs of each state’s statute.’ Equally significant, lower Federal courts are reading the text of state RICO legislation—despite differ- ences in language and policy—in a fashion identical to Federal RICO, most often relying on “pattern” grounds for dismissal of complaints.* Courts “are not at liberty to imply . . . condition[{s] which . .. [are] opposed to the explicit terms of ... [a] statute... To [so] hold... is not to construe the ... [statute] but to amend it.” Fed- orenko v. United States, 449 U.S. 490, 513 (1981) (quoting Detroit Trust Co. v. The Thomas Barlum, 293 U.S. 21, 38 (1934)). Nor should courts fail to recognize the differences in text and policy between Federal and state legislation. (Continued from previous page) Federal decisions); Banderas, 461 $.2d at 270 (organized crime limitation rejected; “garden variety” fraud exclusion rejected, but urged, citing Sedima S.P.R.L. v. Imrex, Inc., 741 F.2d 482 (2d Cir. 1984), rev'd, 473 U.S. 479 (1985)). See, e.g., Plains Resources, Inc. v. Gable, Civil No. 83-)M- 2145 (D. Colo. 1984) (organized crime limitation read into Federal and Colorado RICO statutes), rev'd, 782 F.2d 883, 887 (10th Cir. 1986) (relying on Sedima). *See, e.g., |.G. Williams v. Regency Properties Ltd., 672 F. Supp. 1436, 1442-43 (N.D. Ga. 1987) (Georgia RICO “pattern” dismissed, since like Federal RICO); Michelson v. Merrill Lynch Pierce Fenner & Smith, 669 F. Supp. 1244, 1250 (S.D.N.Y. 1987) (New Mexico RICO “pattern” not dismissed, since like Federal RICO): Behunin v. Dow Chemical Co., 650 F. Supp. 1387, 1390 ‘DC. Colo. 1986) (Colorado RICO “pattern” dismissed, since like Federal RICO); Cook v. Zions First Nat’l Bank, 645 F. Supp. 423, 426 (D.C. Utah 1986) (Utah RICO “pattern” dismissed, since like Federal RICO); Schnitzer v. Oppenheimer, 633 F. Supp. 92. 99 (D.C. Ore. 1985) (Oregon RICO “pattern” dismissed, since like Federal RICO). See infra n.29. Accordingly, Amici urge this Court to give to Federal RICO an appropriate construction on the issue of ‘*nat- tern’’ and to provide appropriate guidance for the lower courts to use when undertaking the sensitive task of mak- ing the required independent analysis of state RICO statutes. ra’ Vv STATEMENT For the statement of the facts and course of the legal proceedings below, the Court is respectfully directed to the briefs of the parties. One issue is presented: Whether the Petitioners have alleged a ‘‘pattern of racketeering activity’’ under RICO, 18 U.S.C. ¢§ 1961-68? Amici urge this Court to answer this issue in the affirmative. ray a SUMMARY OF ARGUMENT In 1970, Congress enacted RICO as Title IX of the Organized Crime Control Act. In Sedima this Court sug- gested that the I’ederal courts reexamine ‘‘pattern’’ within the context of Federal RICO. The result has been a series of conflicting decisions. An examination of the text, legis- lative history, and policy of Federal RICO indicates that **pattern’’ means a ‘‘design’’ that reflects ‘‘relationship’’ and ‘‘continuity.’’ Different ‘‘designs’’ are possible de- pending on the different uses of the concept of ‘‘pattern’’ within RICO. Nothing in the text, legislative history, or policy of RICO justifies the adoption of a rigid multiple scheme limitation. 6 No matter how Federal RICO is read, the definition of “pattern” in state legislation is an independent question. The language of the Federal RICO statute is not identical with the language used by the twenty-seven states that fol- lowed Congress’ lead by adopting similar RICO legislation. The RICO statute of each state has its own legislative his- tory, text, and jurisprudence. This Court’s explication of the Federal “pattern” requirement provides guidance to Federal courts on the interpretation of each state's RICO statute in cases in which such interpretation is pre- sented. Although this ease does not directly present such interpretation, Amici urge this Court to provide guidance that state RICO statutes must be read on their own merits and not automatically in a fashion identical to their Fed- eral counterpart. —-—_—__ ——_ -Q——_- -—_--:_ -_—_——- ARGUMENT I ‘‘PATTERN’’ IS ESTABLISHED WHERE ACTS ARE RELATED AND MANIFEST OR POSE A THREAT OF CONTINUITY WITHOUT REGARD TO THE PRESENCE OF MULTIPLE SCHEMES. In 1970, Congress enacted RICO as Title IX of the Organized Crime Control Act. 18 U.S.C. §§ 1961-68 (1982). It was designed to provide a new weapon for the assault on organized crime. Russello v. United States, 464 U.S. 16, 26 (1983). The statute targeted but was not limit- ed to, the infiltration of legitimate businesses by organized crime figures. United States v. Turkette, 452 U.S. 576, 590-91 (1981); Russello, 464 U.S. at 26, 28; Sedima S.P.R.L. v. Imrex Co. Inc., 473 U.S. 479, 495 (1985). Indeed, 18 U.S.C. §1962 made it unlawful for “any person” to violate its substantive provisions by engaging in a ** nat- tern of racketeering activity’’ by, through, or against any ‘‘enterprise.’” If a person violates RICO’s provisions by engaging in the prohibited ‘pattern of racketeering ac- tivity,’ he has, in effect, engaged in ‘‘organized crime,’’ and is appropriately subject to RICO’s criminal and civil sanctions.''’ RICO is to be liberally construed. 84 Stat. 947 (1970). Its sanctions were designed to supplement, but not supersede, other Federal and state criminal and civil remedies. Id. This Court’s opinion in Sedima contained the now often cited footnote number 14, which stated, ‘‘the failure of Congress and the courts to develop a meaningful con- cept of ‘pattern’... resulted in the extraordinary uses to which civil RICO... [had] been put .. .’’ 473 U.S. at 200. Ignoring the general teachings of this Court in *Sedima, 473 U.S. at 495. See generally, United States v. Cauble, 706 F.2d 1322, 1330 (5th Cir. 1983) (“enterprise crim- inality’’ consists of “all types of organized criminal behavior . . . [ranging] from single political corruption to sophisticated white-collar crime schemes to traditional Mafia-type endeavor”) (quoting, Blakey and Gettings, Racketeer Influenced and Cor- rupt Organizations (RICO): Basic Concepts Criminal and Civil Remedies, 53 Temple L. Q. 1009, 1013-14 (1980), cert. denied, 465 U.S. 1005 (1984); Goldsmith, RICO and Enterprise Crim- inality, 88 Col. L. Rev. (1988). Racketeering activity” is defined in 18 U.S.C. § 1961(1) to mean various forms of conduct in violation of listed Federal and state criminal statutes. It is not necessary, however, that a person be previously convicted of one of the listed offenses be- fore the person can be found responsible under the criminal or civil provisions of RICO. Sedima, 473 U.S. at 490 n.8, 500 n.14. "RiCO’s criminal sanctions include imprisonment, fine and forfeiture. 18 U.S.C. § 1963 (1982). RICO’s civil sanctions in- clude injunctions and treble damages. 18 U.S.C. § 1964 (1982). 8 Sedima, and narrowly focusing on footnote 14, the lower courts have continued to dismiss the majority of civil RICO eases filed, most often relying on ‘‘nattern’’ grounds. Conflicting cireuit court decisions employ diverse and con- fusing uses of the concept of ‘pattern.’ This jurispru- dential confusion has been aptly termed **sheer bedlam.’*! 12Compare Bartecheck v. Fidelity Union Bank/First National State Bank, 832 F.2d 36, 38-40 (3rd Cir. 1987) (multiple scheme test rejected; need not be open ended; multiple factors); Cali- fornia Architectural Bldg. Products, Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1469 (9th Cir. 1987) (single episode limita- tion rejected); Roeder v. Alpha Indus., Inc., 814 F.2d 22, 31 (1st Cir. 1987) (multiple scheme or episode limitation rejected; mul- tiple factors must be considered) ; United States v. lanniello, 808 F.2d 184, 189-93 (2d Cir. 1986) (multiple scheme limitation re- jected; continuity for “pattern” may be found from continuing character of enterprise and open-ended nature of scheme); Morgan v. Bank of Waukegan, 804 F.2d 970, 974-77 (7th Cir. 1986) (multiple scheme limitation rejected; “pattern’” may be found where series of discrete harms inflicted) and Bank of American National Trust & Savings Ass’n v. Touche Ross Co., 782 F.2d 966, 987 (11th Cir. 1986) (different criminal episodes test rejected); with Garbade v. Great Divide Mining & Milling Corp., 831 F.2d 212, 214 (10th Cir. 1987) (single discrete scheme not “pattern”); HMK Corp. v. Walsey, 828 F.2d 1071, 1073-74 (9th Cir. 1987) (single development scheme not “pattern”’), cert. denied, 107 S. Ct. 706 (1988); Superior Oil v. Fulmer, 785 F.2d 252, 255-58 (8th Cir. 1986) (single scheme established relation- ship, but negates continuity for “pattern’’) and Madden v. Gluck, 815 F.2d 116 n.1 (8th Cir. 1987) (Fulmer “adhere[d] to” despite lanniello). For an excellent analysis of “pattern” that precedes, but anticipates the holdings of Bartecheck, etc., see Note, Re- consideration of Pattern in Civil RICO Offenses, 62 Notre Dame L. Rev. 92 (1986) (cited with approval in Sun Savings & Loan Ass’n v. Dierdorff, 825 F.2d 187, 192 (9th Cir. 1987)). See also Beck v. Manufacturers Hanover Trust Co., 820 F.2d 46, 50 (2nd Cir. 1987) (enterprise must have continuity); Montesano v. Sea First Commercial Corp., 818 F.2d 423, 426 (Sth Cir. 1987) (Beck followed). B3Furman v. Cirrito, 828 F.2d 898, 909 (2nd Cir. 1987) (Pratt, ' in dissent). For a detailed critique of “pattern,” see Equitable Relief at 535 n.37. Amici urge this Court to avoid the narrow approach of the lower courts and to adopt a straightforward definition of ‘*nattern’’ within RICO. Any effort to develop a meaningful definition of ‘‘pat- tern’’ ought to begin with the language of the statute. Sedima, 473 U.S. at 495 n.13; Russello, 464 U.S. at 20; Turkette, 452 U.S. at 580." The statute says ‘‘activity.’’ 18 U.S.C. § 1961(1) (1982). It does not say ‘‘schemes’’ or ‘‘episodes.’’ The statute ‘‘requires’’ that the ‘‘activity”’’ be composed of ‘‘at least two acts.’’ 18 U.S.C. § 1961(5) (1982). RICO’s text, therefore, limits, but does not define “pattern.” Sedima, 473 U.S. at 496, n.14 (“while two acts are necessary, they may not be sufficient’’).. Accord- ingly, ‘‘pattern’’ should be read in its ordinary or plain “The definition of “pattern” must serve six functions: 1. The definition of criminality (when an indictment may be returned); 2. A statement of a claim for relief (when an action may be brought); 3. The principal of claim preclusion (when an action must be brought); 4. The application of the statute of limitation (when, in whole or in part, it is too late to bring an action); 5. The scope of discovery before trial; and, 6. The admissibility of evidence at trial. Any definition of “pattern’’ must be faithfu! to the text of the statute, its legislative history, and its purpose. In addition, the definition ought to meet two tesis: it ought to work equally well on the civil and crimina! sides of the statute, and it ought to work equally well in §§ 1962(a), (b) and (c). 'SSee generally Helvering v. Morgan’s, Inc., 293 U.S. 121, 125 n.1 (1934) (discussion of difference between “means” and “in- cludes”); Blakey, The RICO Civil Action in Context, 58 Notre Dame L. Rev. 237, 241 n.16 (1982) (hereinafter Civil Action). 10 meaning, yet viewed within the context of the entire stat- ute. Sedima, 473 U.S. at 489, 495 n.13; Russello, 464 U.S. at 21, 22-23; Turkette, 452 U.S. at 580, 582, 587. The or- dinary or plain meaning of ‘‘pattern’’ is ‘‘design.’’" Ob- viously, a single kind of ‘‘design’’ is not required for all usstions or all uses of the concept within each section."” Thus, the requirement of ‘‘pattern’’ is a standard, not a rule.'* The legislative history of the statute should also be examined. Sedima, 473 U.S. at 486; Turkette, 452 U.S. at 586. Neither the text nor the legislative history requires a ‘‘single scheme’? or ‘‘multiple schemes’? for a showing ‘The Oxford English Dictionary paraphrases “pattern” as Atuitaa or “discernible form.”” See Vil The Oxford English Dictionary 565-66 (1933) (thirteen uses are noted; number eight refers to “design’”); Ill the Oxford English Dictionary 315 (1933) (definition number 8C: “An arrangement or order of things or activity in abstract sense; order or form discernible in things, actions, idea, situations, etc. Freq. with of, as pattern of be- havior . . . and as second element with defining word.”) (em- phasis in original). See RICO Revisited: An Advanced Seminar on the Latest Techniques in Civil Suits, 157 (1987) (“Pattern may be used in RICO violation in at least 240 different contexts [3 (sections) x 5 (kinds of enterprises) x 4 (kinds of predicate offenses) x 4 (roles in violations) = 240].”); See L. Wittgenstein, Philosophical In- vestigation 20 (2d ed. 1953) (‘For a large class of cepa not for all—in which we employ the word ‘meaning’ it can De defined thus: the meaning of a word is its use in the language.”’) (emphasis in original). Morgan, 804 F.2d at 976 (The doctrinal requirement of pattern of racketeering activity is a standard, not a rule, and as such its determination depends on the facts and circumstances of the particular use with no one factor being necessarily deter- minative.”’); 11 R. Pound, Jurisprudence 124-29 (1959). See also Nash v. United States, 229 U.S. 373, 376 (1913) (“restraint of trade’) (Holmes, |.) (“{T}he law is full of instances where a man’s fate depends on. . . some matter of degree.”’) 11 of ‘‘pattern.’" ‘‘Schemes”’ or ‘“‘episodes’’ are aot men- tioned either.” In facet, the legislative hiswory materials specifically point to only two goals that any definition of the concept of ‘pattern’? ought to reflect: **relationship”’ and ‘‘continuity.”’ See, e.g., S. Rep. No. 91-617, 91st Cong., Ist Sess. 158 (1964). Their inclusion in the concept reflects a desire to target more than mere **sporadie ac- tivity.”’ Td. If such concepts as ‘*scheme”’ or **episode’’ are rele- vant to a text-based approach to the concept of **pattern”’ that reflects the notion of ‘‘design,’’ the concepts would have validity solely as fests for the presence of congres- sionally-mandated goals. For example, a single ‘‘episode”’ (defined to mean several acts, so closely related in time and placed that they may be fairly described as producing but a single harm will not carry with it the reality or the threat of continuity. See, e.g., Schreiber Distrib. Co. v. Serv-Well Furniture Co., Inc.. 806 F.2d 1393, 1399 (9th Cir. 1986) (diversion of single shipment of product not pattern). As such, no pattern will be present. Yet a ‘multiple scheme’’ or ‘‘multiple episode’’ test ought not to be elevated to a judicially imposed requirement that "Compare United States v. Qaoud, 777 F.2d 1105, 1106 (6th Cir. 1985) (single scheme not required: acts need only be related by enterprise), cert. denied, 106 S. Ct. 1499 (1986) and A.B.A. Criminal Justice Section, Comprehensive Perspective on Civil and Criminal RICO Legislation and Litigation: A Report of the RICO Cases Committee 36-37 (1985) (common scheme lim- italion rejected, since it would frustrate the application of RICO to conglomerates of crime); Morgan, 804 F.2d at 975 (single scheme not precluded; “otherwise... a single scheme would automatically escape RICO liability . . . untenable result.”’). *Janniello, 808 F.2d at 192 n.16 (no “clear legislative his- tory” mandating multiple schemes). 12 would be inflexibly applied as a substitute for congres- sionally mandated elements. The point is most clearly seen in the context of See- tions 1962(b) and (d) of RICO. In construing ‘*pattern,”’ most of the lower courts have concentrated on Section 1962(c). See, e.g., Superior Oil, 785 F.2d at 255; but see id. at 255 and n.1 (6§ 1962(a), (b), and (c) ‘*share in com- mon’’ the ‘‘pattern’’ concept). Suppose, however, that the multiple scheme limitation were applied to Section 1962(b), which deals with the takeover of an enterprise, and which, all concede, represents the principal, albeit not exclusive, purpose of RICO, See Russello, 464 U.S. at 28: Turkette, 452 U.S. at 590-91. Should no pattern be found where the racketeering activity was engaged in pur- suant to a single scheme, then Section 1962(b) will have been read out of the statute—or at least rewritten to pro- hibit only the acquisition of multiple enterprises. /anniel- lo, 808 F.2d at 192 (*‘requiring two schemes to establish pattern would effectively eleminate’’ § 1962(b))2' Such a result would be both ‘“‘absurd’’ and ‘‘surprising.’’ Tur- kette, 452 U.S. at 587. It is not what Congress intended. S. Rep. No, 91-617, 91.1 Cong., Ist Sess. 158 (1969) (‘*The infiltration of legitimate business normally requires more than one ‘racketeering activity’ and the threat of contin- uing activity to be effective. It is this factor of continuity plus relationship which combines to produce a pattern.’*) 21See also Paul S. Mullin & Assoc., Inc. v. Bassett, 632 F. Supp. 532, 541 (D. Del. 1986) (“[A]n attempt by a racketeering enterprise to infiltrate General Motors could involve countless acts... . One could argue, however, that [no pattern was] in- volved because only one company was subverted. Under this view, a ‘pattern’ would come into existence only after the same enterprise began to infiltrate Chrysler or Ford.”). 13 Thus, to be successful, the takeover of a legitimate business—even though accomplished in the context of a ‘‘single scheme’’ or ‘‘single episode’’—would ‘“‘normally’’ require not only the act of takeover, but also a ‘‘threat”’ of continuing criminal activity to maintain its objective. Otherwise, the business could be reclaimed at any time. See Morgan, 804 F.2d at 975. (**To foeus excessively on either continuity or relationship alone effectively negates the remaining prong.’’) Similarly, requiring multiple schemes for ‘‘pattern’’ potentially conflicts with Section 1962(d) (conspiracy). A requirement of multiple schemes might defeat a single conspiracy charge. Conversely, a showing of a single conspiracy might preclude a finding a multiple schemes for ‘**pattern.’’ One act does not make a pattern. United States rv. Joseph, 781 F.2d 549, 554 (6th Cir. 1986). Nor do isolated acts. S. Rep. No. 91-617, 91st Cong., Ist Sess. 158 (1969) (*[O)|ne ‘isolated racketeering’ activity . .. [is] insuf- ficient ....’’) Nothing in the text or the legislative his- tory of the statute indicates that continuity (or its threat) may only be found in, or inferred from, the racketeering activity itself. It is wholly consistent with the text and legislative history of the statute to find continuity in any aspect of a violation that relates to the racketeering ae- tivity. lanniello, 808 F.2d at 190-91 (threat of continuity found from ongoing character of organized group). Con- 14 tinnity, too, should be tested during the ‘‘pattern,’’ not after its termination.” RICO is part of Title 18, the Federal criminal code. As such, ‘‘act”’ is best understood in tie traditional sense of actus reus and mens rea, United States v. Bailey, 444 U.S. 394, 415 n.11 (1980) (**Congiess in enacting criminal statutes legislates against a bac!:ground of Anglo-Saxon common law... .’’). When examining the ‘‘acts’’ that make up an alleged *‘pattern,’’ no reason exists for focus- ing on a purely jurisdictional ‘‘act,’? that is, a mailing, a use of wire communication, or interstate or foreign trans- portation. Sce e.g., Elliott v. Chicago Motor Club Lus., 809 F.2d 347, 350 (7th Cir. 1987) (mailings relating to same fraud not distinct for purpose of determining pat- tern); cf. Cabbell v. United States, 636 F.2d 246, 248-49 (Sth Cir. 1980) (proper prosecutorial unit under 4 2314 may ignore jurisdictional elements). While ‘‘pattern’’ must be read consistently in erim- inal and civil litigation, the ‘‘aets’’ that constitute the ‘pattern’? may differ. Elliott, 809 F.2d at 350 (quoting Lipin Enterprises, Inc. v. Lee, 808 F.2d 322, 325 (ith Cir, 1986) (Cudahy, J., coneurring) (‘‘a multiplicity of mail- ings does not reasonably translate directly into a ‘pat- 2Marshall-Silver Construction Co., Inc. v. Mendel, 835 F.2d 63, 66 (3rd Cir. 1987) (“poses or posed”); Liquid Air Corp. v. Rogers, 834 F.2d 1297, 1309 (7th Cir. 1987) (“duration ot the predicate acts”); Sun Savings, 825 F.2d 194 n.5 (9th Cir. 1987); City of New York v. Joseph L. Balkan, Inc., 656 F. Supp. 536, 545 (E.D.N.Y. 1987) (continuity measured between acts not at ter- mination); Louisiana Power & Light Co. v. United Gas Pipe Line Co., 642 F. Supp. 781, 810 (E.D. La. 1986) (would have continued if not caught). 15 tern’ ’’)). Compare Lipin Enterprises, 803 F.2d at 325 (Cudahy, J.) (‘‘It is not clear that the same analysis would be appropriate in cases involving other kinds of predicate acts [such as] arson.’’). The cause should focus on ‘‘act’’—the actus reus—that inflicts discrete harm. Morgan, 804 F.2d at 975. Using this approach, a ‘*pattern’’ may exist when at least two acts, which are ‘designed’? or have ‘‘discernible form’’ in reference to themselves or to the enterprise occur, and which reflect continuity (or its threat), either by looking at the acts themselves (¢.g., many bribes paid over a period of time), the purpose for which they were committed (e.g., obtaining, on a continuing basis, valuable rate consideration) or the enterprise itself (e.g., a corporation, a publie commission, or an on-going association of persons ard entities). Under this approach, little doubt exists that the Petitioners in this appeal stated a “pattern”™ in their complaint. The judg- ment of the Court of Appeals should be reversed. PATTERN UNDER STATE LAW IS AN INDEPENDENT QUESTION No matter how Federal RICO may be interpreted, cru- cial differences exist between Title IX and the definitions of **For parallel concepts, seé Henry v. Farmer City State Bank, 808 F.2d 1228, 1237 (7th Cir. 1986) (municipal liability under 42 U.S.C. § 1983 (1982) (“{A] plaintiff must allege [under Oklahoma City v. Tuttle, 471 U.S. 808, 814 (1985)} a specific pattern or series of incidents that support the general allegations of custom or policy .. . .”); United States v. Iron Workers Local 86, 443 F.2d 544, 551-52 (9th Cir.) (“pattern or practice” prerequi- site for an attorney general suit under Title Vil: defined as “more than an isolated, sporadic incident, but is repeated rou- tine of a generalized nature’) (quoting 110 Cong. Rec. 14270 (1970)) (remarks of Sen. Hubert H. Humphrey), cert. denied, 404 U.S. 984 (1971). 16 ‘*pattern’’ found in the individual state statutes that have pattern requirements. Althongh some states do not use ‘‘nattern’’ at all in their statutes, but instead rely on the more general concept of ‘racketeering activity,’ all state RICO statutes are vulnerable to unwarranted limi- tations imposed in Federal courts interpreting them, Anal- ysis of state RICO statutes requires independent exami- nation of their particular words and histories consistent with their rich variety and with the principles of federal- ism. The selection of a limitation or a definition of the pattern concept differs among the states, New Jersey? follows Federal RICO, creating only a limitation, while Pennsylvania” says ‘‘refers.”’ The statutes of the re- maining states that require patterns say ‘‘means,’”’ thus providing an exact definition of ‘“‘pattern.’”* It is, there- fore, inappropriate to read Federal concepts (i.e, ‘*scheme’* or ‘‘episode’’) into these definitions, especially 4See, e.g., Poling v. Morgan, 829 F.2d 882, 887 (9th Cir. 1987) (Arizona RICO). See also, Hawaii Rev. Stat. § 842 (1976); N.D. Century Code § 12:1-06.1 (Smith Supp. 1985). 23N J. Stat. Ann. § 2C:41-1 (d) (1), (2) (West Supp. 1982) (“Pattern of racketeering activity” requires. . .). 218 Pa. Cons. Stat. §911(h) (Pardon 1983) (‘Pattern of racketeering activity” refers. . .). "See, e.g., Nev. Rev. Stat. § 207.390 (1983) (“Racketeering activity” means .. .); Ohio Rev. Code § 2923.31 (1986) (‘Pattern of Corrupt Activity” means . . .); Wis. Stat. Aan. § 946.82 (West Supp. 1984-85) (“Pattern of racketeering activity’ means . . .). **See supra n. 15. 17 where the Federal concepts do not have textual support in the state statutes,” and particularly where these state %It is particularly inappropriate to use Federal jurisprudence on “multiple schemes” or “multiple episodes” developed after the effective date of a state statute to narrow a state statute. See, e.g., Behunin v. Dow Chemical Co., 650 F. Supp. 1390 (D.C. Colo. 1986) (Kane, |.) (“pattern’’ under Colorado RICO “coin- cide|s] with the meaning of its Federal counterpart.”’) In fact, before 1981, the effective date of the Colorado statute, RICO defense counsel made a major effort to exclude a “single episode” from Federal RICO. Asa matter of law, it did not succeed. See, e.g., United States v. Moeller, 402 F. Supp. 49, 57-58 (D.C. Conn. 1975) (single episode limitation advocated under § (c) but rejected as inconsistent with precedent under § (b) thought to be controlling). As a matter of prosecutorial discretion, it did. United States Attorney's Manual, Title 9— Criminal Division § 9.110.340 (RICO prosecution not to be brought where only a single episode). In addition, the uniform holding in the Federal decisions prior to 1981 was that “two acts,” not “two schemes,” were all that was required to estab- lish a “pattern.” See, e.g., United States v. Parness, 503 F.2d 430, 441-42 (2nd Cir. 1974) (“pattern” requires “two acts,” not “two schemes”) cert. denied, 419 U.S. 1105 (1975)); United States v. Weatherspoon, 581 F.2d 595, 602 (7th Cir. 1978) (same); United States v. Starnes, 644 F.2d 673, 677-78 (7th Cir.), cert. denied, 454 U.S. 826 (1982) (same); United States v. Calabrese, oa a 1379, 1389 (10th Cir.) (same), cert. denied, 454 US. 831 (1981). Prior to 1981 the Federal courts had held that if the prose- cution could show a “common scheme or plan” involving mul- tiple acts, a “pattern” was present. United States v. Stofsky, 409 F. Supp. 609, 614 (D.C. S.N.Y. 1973), aff'd, 527 F.2d 237 (2d Cir. 1975), cert. denied, 429 U.S. 819 (1976). Some interpreted this holding to mean that a “pattern” could only be found if there were a “common scheme or plan” linking the “acts.” Later decisions definitively establi that as long as the “acts” were related to the affairs of an enterprise, a “pattern” was present, regardless of whether a “common scheme or plan” existed. United States v. Weisman, 624 F.2d 1118, 1122 (2d Cir.), cert. denied, 449 U.S. 871 (1980) (citing United States v. Filiott, 571 F.2d 880 (5th Cir), cert. denied, 439 U.S. 953 (1978)). Thus, at (Continued on following page) 18 statutes, like their Federal counterpart, are to be liberally construed.” ‘Continued from previous page) the time Colorado RICO was passed in 1981, it was possible to show “relationship” under Federal RICO solely through the enterprise concept. The Federal courts, in short, had neither imposed a requirement that the “acts” be related to one an- other, nor adopted a narrow concept of continuity requiring multiple schemes. Even a cursory examination of the used to detine “pattern” under the Colorado statute e made it clear that its definition was “significantly difterent from that of Federal RICO. See Colo. Rev. Stat. § 18-17-103 (Supp. 1984). As such, limitations on RICO judicially crafted in the Federal courts since 1981 should not have been read into the Colorado statute. See supra n.4. The author of the Behunin opinion has been unusually candid about his personal feelings toward RICO. “RICO is just -_ . a rather sloppily thought out kind of way to get the Mafia that every body jumps on so that they can have more fun with fraud.” In Re Dow Co. SaraBond Products Liability, 666 F. Supp. 1466, 1470 (D.C. Colo. 1987) (Kane, }.). As such, “policy con- siderations” warrant the statute being “put to rest.” Id. Com- pare 116 Cong. Rec. 35,204 (1970) (statements of Cong. Poff) (‘no single measure [had] received more thorough considera- tion’): lannelli v. United States, 420 U.S. 770, 789 (1975) (“care- fully crafted piece of legislation”) with United States v. Turkette, 452 US. 576, 587 (1981) (“there is no argument that Congress acted bevond its power . . . that being the case, the courts are without authority to restrict the applications of the statute.”). *The presence of a liberal construction clause is not un- usual in state law. Such clauses had their origin in the codifi- cation movement of the 19th century. Edward Livingston sug- gested the rejection of the old common law rule of strict con- struction in the farsighted code he drafted for Louisiana between 1820 and 1825. 1 E. Livingston, Complete Works on Criminal jurisprudence 231 (1873 ed); 1 E. Livingston, supra, at 14. (“{A} penal laws whatever are to be construed according to the plain import of their words. . . .”). Livingston's suggestion for Louisiana was followed by David Dudley Field in his influ- ential draft of codes of penal law and criminal procedure for New York. The Code of Penal Law 5 (1865 ed.) (“fair import’); The Code of Criminal Procedure of the State of New York 470- (Continued on following page) 19 Federal RICO uses ‘‘acts’’ as its unit for counting for ‘‘continuity.’’ 18 U.S.C. § 1961(1) (1982). The states, on the other hand, utilize a variety of concepts in their attempt to establish a similar ‘‘continuity’’ prong for (Continued from previous page) 71 (1850 ed.) (revised code to be given “liberal construction” as the old rule had no support in any “principle of substantial justice, and . . . [its] highest aim, practically considered, seem|ed] to be, to render that law inconsistent with its spirit and as a consequence, absurd and ridiculous”). Ultimately, Livingston’s and Field’s work formed the intellectual basis for the Federal Rules of Civil and Criminal Procedure. C. Wright & A. Miller, Federal Practice and Procedure § 104 (1969). judicial hostility to change through legislation was com- mon in the 19th century. See J. Hurst, The Growth of American Law 186 (1950): [Wihere [judges] were not ready boldly to declare [it] un- constitutional, [they were ready] to interpret it so restric- tively as to narrow its effect. These factors found expression in the abstract canons of statutory interpretation . . . : strict construction of stat- utes in derogation of the common law; strict construction of penal statutes, or of legislation that imposed ‘drastic’ burdens, or of legislation that imposed special damages... . The effect was to put a primarily obstructive, if not de- structive connotation on the process of statutory inter- pretation. Legislatures reacted. “{I]t became standard practice in drafting statutes to insert a preamble stating broadly the purpose of the act and to close with a provision declaring that the statute should be liberally construed.” D. Wigdor, Roscoe Pound: Philosopher of Law 174 (1974); see E. Patterson, Jurisprudence: Men and Ideas of the Law 421 (1953). In fact ,a majority of states have abolished the common law rule. Civil Action, at 237, 245, n.25 (1982). Judicial hostility, however, continues into the 20th cen- tury. See, e.g. Sedima, 473 U.S. at 529 (Powell, J.) (liberal con- struction applies only to criminal provisions); Saine v. ALA, Inc., 582 F. Supp. 1299, 1305 (D.C. Colo. 1984) (same) (Kane, J). Courts have recognized that strict construction is not of constitutional dimension. See, e.g., Tarrant v. Ponte, 751 F.2d 459, 466 (1st Cir. 1985). 20 ‘*nattern.’’ Colorado," Illinois? New York, Pennsyl- vania** and Washington*® follow Federal RICO by count- ing ‘‘acts.’’ The remainder of ‘*pattern’’ states expressly count ‘incidents,’ ‘*episodes’*’ or ‘‘events,’"> each of which is synonymous with ‘‘oceurrence.’*? They reflect the position advocated by Judge Newman in United States v. Moeller® and codified by the guidelines of the Depart- ment of Justice’! that more than one occurrence is re- quired. This intent is most evident in the more recently Colo. Rev. Stat. § 18-17-103 (Supp. 1984) (‘Pattern of racketeering activity means engaging in at least two acts... .”). 37/1, Rey. Stat. ch. 56-Y2 § 1653(b) (Smith Hurd Supp. 1984- 85) (‘Pattern of narcotics activity means two or more acts... .”). 3NY Penal Code § 460.10 (1986) (‘Pattern of criminal ac- tivity means conduct engaged in by persons . . . constituting three or more criminal acts.”). 418 Pa. Cons. Stat. §911(h) (Pardon 1983) (‘pattern of racketeering activity refers to a course of conduct requiring two or more acts. .. .’’). Wash. Rev. Code Ann., §9A.82.010 (West Supp. 1986) (“Pattern of criminal profiteering activity means engaging in at least three acts... .”’). See, e.g., Fla. Stat. Ann., § 772.02 (1986) (‘Pattern of crim- inal activity means engaging in at least two incidents. . . .”’). Utah Code Ann. § 76-10-1602 (Smith Supp. 1985) (“Pattern of racketeering activity means engaging in at least two episodes of racketeering conduct.”’). See, e.g., Wash. Rev. Code Ann. § 9A.82.010 (West Supp. 1986) (’ .. . not be isolated events. . .”’). %V Oxford English Dictionary 152 (1933) (incident-French); Il id. 245 (episode-Greek), 338-39 (event-Latin). 402 F. Supp. 49, 57-58 (D.C. Conn. 1975), cert. denied, 429 U.S. 1039 (1977). See supra n.29. “United States Attorney’s Manual, Title 9—Criminal Divi- sion § 9-110.340 (‘single criminal episode”). See supra n.29. 21 enacted statutes, which specifically preclude counting as separate occurrences those that are too closely related in point of time and place.” None of these states, however, exclude from ‘‘pattern’’ a ‘‘single scheme.’*? As in Fed- eral RICO, the focus is on the conduct of people, not their state of mind, and these definitions do not lend them- selves to a ‘‘semantical game of generalizing the illegal objective.’’ Montesano v. SeaFirst Commercial Corp., 818 F.2d 423, 426 (5th Cir. 1987) (Higginbothan, J.). Federal RICO has included the ‘‘relationship’’ re- quirement in ‘‘pattern’’ through its legislative history. The states, on the other hand, use a variety of methods to deal with the factor of ‘‘relationship.’’ New Mexico relates ‘‘ineidents’’ solely by intent.4 Pennsylvania re- “See, e.g., Del. Code Ann., Title 11, § 1502 (1986); N.Y. Penal Code, § 460.10 (1986); Ohio Rev. Code § 2923.31 (1986); Wis. Stat. Ann., § 946.82 (West Supp. 1984-85). #80On the other hand, New York (N.Y. Crim. Proc., § 40.10(2) (1985) (“Criminal transaction” means conduct which established at least one offense, and which is comprised of two or more of a group of acts either (a) so closely related in point of time and circumstances of commission as to constitute a single criminal incident, or (b) constitute elements or integra! parts of a single criminal venture’’)) and Florida (Fla. Stat. Ann., § 772.02(4) (1986) (For the purposes of this chapter, the term ‘pattern of criminal activity’ shall not include two or more incidents of fraudulent conduct arising out of a single contract or transaction against one or more related persons’’)) preclude a single “transaction” from constituting a “pattern.’” “Transactions’’ may be _ para- phrased as “the carrying on or completion of an action or course of action.”” XI Oxford English Dictionary 251 (1933) (em- phasis added). It can, therefore, be read either narrowly or broadly. Compare, Thomas v. Myers-Dickson Furniture Co., 479 F.2d 740, 746 (5th Cir. 1979), with Dombalion v. Fox, 88 Cal.App. 3rd 763, 765-67, 152 Cal.Rptr. 86, 87-88 (Ct. App., Div. 1 1979). 4N.M. Stat. Ann. § 30-42-1-3 (Michie Supp. 1980). quires a ‘‘course of conduct.’ Where the enterprise is a legitimate one, New York requires a common scheme or plan; if the enterprise is illegitimate, state of mind and association with the enterprise suffice.“ Colorado, Dela- ware, and Ohio specify that any relationship to the affairs of the enterprise is enough to establish the ‘‘relationship”’ prong of ‘‘pattern.’’ The remaining ‘*nattern’’ states require that the occurrences be interrelated,* yet none provide a definition of ‘‘interrelated.’’ Connecticut, Ore- von and Washington explicitly resolve this ambiguity by expressly including a ‘‘nexus’’ to the affairs of the en- terprise as a form of ‘‘interrelation.’? Federal RICO requires ‘‘at least two acts’? committed ‘‘within ten years’’ of one another. 18 U.S.C. § 1961(5) (1984). New York, Washington, and Wisconsin require three acts” while Pennsylvania imposes no time limita- tion.’ Tennessee requires that the acts be committed within two vears of one another; Connecticut, Florida, 4518 Pa. Cons. Stat. § 911(h) (Pardon 1983). 46N.Y. Crim. Proc. § 40.10 (1985). 4738 Colo. Rev. Stat. § 17-18-103 (Supp. 1984); Del. Code Ann. Title 11, § 1502 (1986); Ohio Rev. Code § 2923.31 (1986). 48See, e.g., Ill, Rev. Stat. ch 56'/2 § 1653 (Smith Hurd Supp. 1984-1985). Conn. Gen. Stat. Ann. § 53-394 (West Supp. 1984); Ore. Rev. Code Ann. § 166.715 (1983); Wash. Rev. Code Ann § 9A. 82.010 (West Supp. 1986). SONY. Crim. Proc. § 40.10 (1985); Wash. Rev. Code Ann. § 9A.82.010 (West Supp. 1986); Wis. Stat. Ann. § 946.82 (West Supp. 1984-85). $118 Pa. Cons. Stat. § 911(h) (Pardon 1983). Tenn. Code Ann. § 93-1-1003 (1986). 23 Idaho, Georgia and North Carolina, four years ;* Illinois, Indiana, Louisiana, Mississippi, Nevada, New Mexico, Ore- gon, Utah and Washington, five years; Ohio, six years ;*5 and Wisconsin, seven years.*© The rest follow the Federal statute.” Since the various state statutes substantially differ from their Federal counterpart, Federal courts interpret- ing the state statutes must pay close attention to the texts of the state statutes when faced with a state RICO claim. Neither crowded court dockets nor considerations of Fed- eralism ought to play a role in the Federal judiciary’s reading of state RICO legislation, whatever role such con- siderations may properly play in reading Federal stat- utes. Compare, Patsy v. Florida Board of Regents, 457 U.S. 496, 512 n.13 (1982) (burden on Federal courts ‘‘not sufficient to justify a judicial decision to alter [a] con- eressionally [drafted scheme]’’) with Arizona ex rel. Corbin, v. Pickrell, 136 Ariz. at 591, 667 P.2d at 1306 See, Conn. Gen. Stat. Ann. § 53-394 (West Supp. 1984); Fla. Stat. Ann. § 772.02 (1986); Idaho Code § 18-7803 (1981); Ga. Code Ann. § 16-14-3 (1983), N.C. Gen. Stat. § 75 D-3 (1986). “See, Ill. Rev. Stat. ch 56'/2 § 1653(b) (Smith Hurd Supp. 1984-85); Ind. Code Ann. § 35-45-6-1 (Burns Supp. 1982); La. Rev. Stat. § 15-1351 (West 1985); Miss. Code Ann. § 97-43-1-3 (Lawyers Co-op 1986); Nev. Rev. Stat. § 207.390 (1983); N.M. Stat. Ann. § 30-42-1-3 (Michie Supp. 1980); Ore. Rev. Code Ann. § 166.715 (1983); Utah Code Ann. § 76-10-1602 (Smith Supp. 1985); Wash. Rev. Code Ann. § 9A.82.010 (West Supp. 1986). SOhio Rev. Code § 2923.31 (1986). ‘6Wis. Stat. Ann. § 946.82 (West Supp. 1984-85). See, e.g., N.J. Stat. Ann. § 2C:41-1(d)(1) (West Supp. 1982); Del. Code Ann. Title 11, § 1502 (1986); Colo. Rev. Stat. § 18-17- 103 (Supp. 1984). 24 (concern for federalization of state cases is not a con- sideration in interpretation of Arizona RICO). oOo CONCLUSION Under a proper construction of ‘‘pattern,’’ the Peti- tioners stated a claim for relief under Federal RICO. This Court ought, therefore, to reject the jurisprudence of the lower courts, which seems more intent on frustrat- ing RICO than implementing it** The judgment of the Court of Appeals should be reversed and the Petitioners’ complaint reinstated. Respectfully submitted, Ropert K. Corsix Attorney General State of Arizona S88More than 100 years ago, this 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 possibie to! annul [it] and render{] it super- fluous and useless.” Pillow v. Roberts, 54 U.S. (13 How.) 472, 476 (1851) (Grier, J.). See also, Indian Towing Co. v. United States, 350 U.S. 61, 68 (1955) (Tort Claims Act) (rejecting “distinctions so fine spun and capricious as to be almost incapable of bein held in the mind for adequate formulation’). Such an Ptinon to statutory construction, however, carries with it a heavy price. After a lifetime of study of the law, Dean Roscoe Pound con- cluded that such construction (1) “tend/ed] to bring the law into disrespect; (2) . . . subjectfed] the courts to political pressure; [and] (3) . . . invite{d] an arbitrary personal element in judicial administration.” 3 Jurisprudence 488 (1959). It threatened, he found, to make “laws . . . worth little’ and to “break down’ the “legal order” itself. Id. at 490. APPENDIX App. 1 Racketeer Influenced And Corrupt Organizations Statute (18 U.S.C. 1961-1968) § 1961. Definitions As used in this chapter— (1) ‘‘racketeering activity’? means (A) any act or threat involving murder, kidnapping, gambling, arson, robbery, bribery, extortion, dealing in obscene matter, or dealing in narcotic or other dangerous druvs, which is chargeable under State law and pun- ishable by imprisonment for more than one year; (B) any act which is indictable under any of the following provisions of title 18, United States Code: Seetion 201 (relating to bribery), section 224 (relating to sports bribery), sections 471, 472, and 478 (relating to coun- terfeiting), section 659 (relating to theft from inter- state shipment) if the act indictable under section 659 is felonious, section 664 (reltaing to embezzlement from pension and welfare funds), sections 891-894 (relating to extortionate credit transactions), section 1084 (relating to the transmission of gambling infor- mation), section 1341 (relating to mail fraud), section 1348 (relating to wire fraud, sections 1461-1465 (re- latine to obscene matter), section 1508 (relating to ob- struction of justice), section 1510 (relating to obstrue- tion of criminal investigations), section 1511 (relating to the obstruction of State or local law enforcement), section 1512 (relating to tampering with a witness, vie- tim, or an informant), section 1513 (relating to re- taliating against a witness, victim, or an informant), section 1951 (relating to interference with commerce, robbery, or extortion), seetion 1952 (relating te racke- App. 2 teering), section 1953 (relating to interstate transpor- tation of wagering paraphernalia), section 1954 (re- lating to unlawful welfare fund payments), section 1955 (relating to the prohibition of illegal cambling businesses), section 1956 (relating to the laundering of monetary instruments), section 1957 (relating to engaging in monetary transactions in property derived from specified unlawful activity), seetions 2512 and 2313 (relating to interstate transportation of motor vehicles), sections 2314 and 2315 (relating to interstate transportation of stolen property), section 2820 (relat- ing to white slave traffic), (C) any act whiel: is indict- vehicle parts), sections 2341-2346 (relating to traffick- ing in contraband cigarettes), sections 2421-24 (relat- ing to whiteslave traffic), (C) any aet which is indict- able under title 29, United States Code, section 186 (dealing with restrictions on payments and loans to labor organizations) or section 501(¢) (relating to em- bezzlement from union funds), (I)) any offense involv- ing fraud connected with a case under title 11, fraud in the sale of securities, or the felonious manufacture, im- portation, receiving, concealment, buying, selling, or otherwise dealing in narcotic or other dangerous drugs, punishable under any law of the United States, or (EB) any act which is indictable under the Curreney and Foreign Transactions Reporting Act; (2) ‘*State’’ means any State of the United States, the District of Columbia, the Commonwealth of Puerto Rico, any territory or possession of the United States, any political subdivision, or any de- partment, ageney, or instrumentality thereof; App. 3 (3) ‘‘person’’ includes any individual or entity capable of holding a legal or beneficial interest in property ; (4) ‘‘enterprise’’ includes any individual, part- nership, corporation, association, or other legal entity, and any union or group of individuals associated in fact althongh not a legal entity; (5) ‘pattern of racketeering activity’’ requires at least two acts of racketeering activity, one of which oceurred after the effective date of this chapter and the last of which occurred within ten years (excluding any period of imprisonment) after the commission of a prior act of racketeering activity ; (6) ‘‘unlawful debt’? means a debt (A) ineurred or contracted in gambling activity which was in viola- tion of the law of the United States, a State or politi- cal subdivision thereof, or which is unenforceable un- der State or Federal law in whole or in part as to prineipal or interest beeause of the laws relating to usury, and (B) which was incurred in connection with the business of gambling in violation of the law of the United States, a State or political subdivision thereof, or the business of lending money or a thing of value at a rate usurious under State or Federal law, where the usurions rate is at least twice the en- foreeable rate; (7) ‘‘racketeering investigator’’ means any at- torney or investigator so designated by the Attorney General and charged with the duty of enforcing or carrying into effect this chapter: App. 4 (8) ‘racketeering investigation’’ means any in- quiry conducted by any racketeering investigator for the purpose of ascertaining whether any person has been involved in any violation of this chapter or of any final order, judgment, or decree of any court of the United States, duly entered in any ease or pro- ceeding arising under this chapter; (9) ‘documentary material’? ineludes any book, paper, document, reeord, recording, or other material; and (10) ‘*Attorney General’ ineludes the Attorney General of the United States, the Deputy Attorney General of the United States, any Assistant Attorney General of the United States, or any employee of the Department of Justice or any employee of any de- partment or agency of the United States so designated by the Attorney General to carry out the powers con- ferred on the Attorney General by this chapter. Any department or agency so designated may use in in- vestigations authorized by this chapter either the in- vestigative provisions of this chapter or the investiga- tive power of such department or ageney otherwise conferred by law. $1962. Prohibited activities (a) It shall be unlawful for any person who has re- ceived any income derived, direetly or indireetly, from a pattern of racketeering activity or through collection of an unlawful debt in whieh such person has participated as a principal within the meaning of section 2, tithe 18, United States Code, to use or invest, ‘lireetly or indireetly, any App. 5 part of such income, or the proceeds of such income, in acquisition of any interest in, or the establishment or operation of, any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce. A purchase of securities on the open market for pur- poses of investment, and without the intention of con- trolling or participating in the control of the issuer, or of assisting another to do so, shall not be unlawful under this subsection if the securities of the issuer held by the purchaser, the members of his immediate family, and his or their accomplices in any pattern or racketeering activity or the collection of an unlawful debt after such purchase do not amount in the aggregate to one percent of the out- standing securities of any one class, and do not confer, either in law or in fact, the power to elect one or more directors of the issuer. (b) It shall be unlawful for any person through a pat- tern of racketeering activity or through collection of an unlawful debt to acquire or maintain, direetly or indireet- ly, any interest in or control of any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce. (c) It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the ae- tivities of which affect, interstate or foreign commerce, to conduet or_ participate, directly or indirectly, in the con- duct «f such enterprise’s affairs through a pattern of racketeering activity or collection of unlawful debt. (d) It shall be unlawful for any person to conspire to violate any of the provisions of subsections (a), (b), or (ce) of this seetion. App. 6 (a) Whoever violates any provision of section 1962 of this chapter shall be fined not more than $25,000 or imprisoned not more than twenty years, or both, and shall forfeit to the United States, irrespective of any provision of State law— (1) any interest the person has acquired or maintained in violation of section 1962; (2) any— (A) interest in; (B) security of; (C) elaim against; or (D) property or contractual right of any kind affording a source of influence over: any enterprise which the person has established, op- erated, controlled, conducted, or participated in the conduct of in violation of section 1962; and (3) any property constituting, or derived from, any proceeds which the person obtained, direetly or indirectly, from racketeering activity or unlawful debt collection in violation of section 1962. The court, in imposing sentence on such person shall order, in addition to any other sentence imposed pursuant to this section, that the person forfeit to the United States all property deseribed in this subsection. In lien of a fine otherwise authorized by this seetion, a defendant who de- rives profits or other proceeds from an offense may be fined not more than twice the gross profits or other pro- ceeds. - : 3 ’ { App. 7 (b) Property subject to criminal forfeiture under this section includes— (1) real property, including things growing on, affixed to, and found in land; and (2) tangible and intangible personal property, ineluding rights, privileges, interests, claims and se- curities. (ec) All right, title, and interest in property described in subsection (a) vests in the United States upon the com- mission of the act giving rise to forfeiture under this sec- tion. Any such property that is subsequently transferred to a person other than the defendant may be the subject of a special verdiet of forfeiture and thereafter shall be forfeited to the united States, unless the transferree es- tablishes in a hearing pursuant to subsection (/) that he is a bona fide purchaser for value of such property who at the time of purchase was reasonably without cause to believe that the property was subject to forfeiture under this section. (d)(1) Upon application of the United States, the court may enter a restraining order or injunction, require the execution of a satisfactory performance bond, or take any other action to preserve the availability of property deseribed in subsection (a) for forfeiture under this see- tion — (A) upon the filing of an indictment or informa- tion charging a violation of section 1962 of this chapter and alleging that the property with respect to which the order is sought, would, in the event of conviction, he subject to forfeiture under this section; or App. 8 (B) prior to the filing of such an indictment or information, if, after notice to persons appearing to have an interest in the property and opportunity for a hearing, the court determines that— (i) there is a substantial probability that the United States will prevail on the issue of for- feiture and that failure to enter the order will result in the property being destroyed, removed from the jurisdiction of the court, or otherwise made unavailable for forfeiture; and (ii) the need to preserve the availability of the property through the entry of the requested order outweighs the hardship on any party against whom the order is to be entered: Provided, however, That an order entered pursuant to subparagraph (B) shall be effective for not more than ninety days, unless extended by the court for good cause shown or unless an indictment or information described in subparagraph (A) has been filed. (2) A temporary restraining order under this snb- section may be entered upon application of the United States without notice or opportunity for a hearing when an information or indictment has not yet been filed with respect to the property, if the United States demonstrates that there is probable cause to believe that the property with respect to which the order is sought would, in the event of conviction, be subject to forfeiture under this see- tion and that provision of notice will jeopardize the avail- ability of the property for forfeiture. Such a temporary order shall expire not more than ten days after the date on App. 9 which it is entered, unless extended for good cause shown or unless the party against whom it is entered consents to an extension for a longer period. A hearing requested con- cerning an order entered under this paragraph shall be held at the earliest possible time, and prior to the expira- tion of the temporary order. (3) The court may receive and consider, at a hear- ing held pursuant to this subsection, evidence and informa- tion that would be inadmissible under the Federal Rules of Evidence. (e) Upon conviction of a person under this section, the court shall enter a judgment of forfeiture of the prop- erty to the United States and shall also authorize the At- torney General to seize all property ordered forfeited upon such terms and conditions as the court shall deem proper. Following the entry of an order declaring the property forfeited, the court may, upon application of the United States, enter such appropriate restraining or- ders or injunctions, require the execution of satisfactory performance bonds, appoint receivers, conservators, ap- praisers, accountants, or trustees, or take any other action to protect the interest of the United States in the proper- ty ordered forfeited. Any income accruing to, or derived from, an enterprise or an interest in an enterprise which has been ordered forfeited under this seetion may be used to offset ordinary and necessary expenses to the enter- prise which are required by law, or which are necessary to protect the interests of the United States or third parties. (f) Following the seizure of property ordered for- feited under this section, the Attorney General shall di- App. 10 rect the disposition of the property by sale or any other commercially feasible means, making due provision for the rights of any innocent persons. Any property right or interest not exercisable by, or transferable for value to, the United States shall expire and shall not revert to the defendant, nor shall the defendant or any person acting in concert with or on behalf of the defendant be eligible to purchase forfeited property at any sale held by the United States. Upon application of a person, other than the defendant or a person acting in concert with or on be- half of the defendant, the court may restrain or stay the sale or disposition of the property pending the conclusion of any appeal of the criminal case giving rise to the for- feiture, if the applicant demonstrates that proceeding with the sale or disposition of the property will result in irreparable injury, harm or loss to him. Notwithstand- ing 31 U.S.C. 3302(b), the proceeds of any sale or other disposition of property forfeited under this section and any moneys forfeited shall be used to pay all proper ex- penses for the forfeiture and the sale, including expenses of seizure, maintenance and custody of the property pending its disposition, advertising and court costs. The Attorney General shall deposit in the Treasury any amounts of such proceeds or moneys remaining after the payment of such expenses. (g) With respect to property ordered forfeited un- der this section, the Attorney General is authorized to— (1) grant petitions for mitigation or remission of forfeiture, restore forfeited property to victims of a violation of this chapter, or take any other action to protect the rights of innocent persons which is in App. 11 the interest of justice and which is not inconsistent with the provisions of this chapter; (2) compromise claims arising under this sec- tion; (3) award compensation to persons providing information resulting in a forfeiture under this sec- tion; (4) direct the disposition by the United States of all property ordered forfeited under this section by public sale or any other commercially feasible means, making due provision for the rights of inno- cent persons; and (5) take appropriate measures necessary to safeguard and maintain property ordered forfeited under this section pending its disposition. (h) The Attorney General may promulgate regula- tions with respect to— (1) making reasonable efforts to provide notice to persons who may have an interest in property or- dered forfeited under this section; (2) granting petitions for remission or mitiga- tion of forfeiture; (3) the restitution of property to victims of an offense petitioning for remission or mitigation of forfeiture under this chapter; (4) the disposition by the United States of for- feited property by public sale or other commercially feasible means; App. 12 (5) the maintenance and safekeeping of any property forfeited under this section pending its dis- position; and (6) the compromise of claims arising under this chapter. Pending the promulgation of such regulations, all pro- visions of law relating to the disposition of property, or the proceeds from the sale thereof, or the remission or mitigation of forfeitures for violation of the customs laws, and the compromise of claims and the award of compensation to informers in respect of such forfeitures shall apply to forfeitures incurred, or alleged to have been incurred, under the provisions of this section, insofar as applicable and not inconsistent with the provisions hereof. Such duties as are imposed upon the Customs Service or any person with respect to the disposition of property under the customs law shall be performed under this chapter by the Attorney General. (i) Exeept as provided in subsection (/), no party claiming an interest in property subject to forfeiture under this section may— (1) intervene in a trial or appeal of a criminal case involving the forfeiture of such property under this section; or (2) commence an action at law or equity against the United States concerning the validity of his al- leged interest in the property subsequent to the filing of an indictment or information alleging that the prop- erty is subject to forfeiture under this section. App. 15 (j) The district courts of the United States shall have jurisdiction to enter orders as provided in this see- tion without regard to the location of any property which may be subject to forfeiture under this section or which has been ordered forfeited under this section. (k) In order to facilitate the identification or loca- tion of property declared forfeited and to facilitate the disposition of petitions for remission or mitigation of forfeiture, after the entry of an order declaring property forfeited to the United States the court may, upon appli- cation of the United States, order that the testimony of any witness relating to the property forfeited be taken by deposition and that any designated book, paper, doeu- ment, record, recording, or other material not privileged be produced at the same time and place, in the same man- ner as provided for the taking of depositions under Rule 15 of the Federal Rules of Criminal Procedure. (/)(1) Following the entry of an order of forfeiture under this section, the United States shall publish notice of the order and of its intent to dispose of the property in such manner as the Attorney General may direct. The Government may also, to the extent practicable, provide direct written notice to any person known to have alleged an interest in the property that is the subject of the or- der of forfeiture as a substitute for published notice as to those persons so notified. (2) Any person, other than the defendant, asserting a legal interest in property which has been ordered fer- feited to the United States pursuant to this section may, within thirty days of the final publication of notice or his receipt of notice under paragraph (1), whichever is App. 14 earlier, petition the court for a hearing to adjudicate the validity of his alleged interest in the property. The he r- ing shall be held before the court alone, without a jury. (3) The petition shall be signed by the petitioner under penalty of perjury and shall set forth the nature and extent of the petitioner’s right, title, or imterest in the property, the time and circumstances of the petitioner’s acquisition of the right, title, or interest in the property, any additional facts supporting the petitioner’s claim, and the relief sought. (4) The hearing on the petition shall, to the extent practicable and consistent with the interests of justice, be held within thirty days of the filing of the petition. The court may consolidate the hearing on the petition with a hearing on any other petition filed by a person other than the defendant under this subsection. (5) At the hearing, the petitioner may testify and present evidence and witnesses on his own behalf, and cross-examine witnesses who appear at the hearing. The United States may present evidence and witnesses in re- buttal and in defense of its claim to the property and cross-examine witnesses who appear at the hearing. In addition to testimony and evidence presented at the hear- ing, the court shall consider the relevant portions of the record of the criminal case which resulted in the order of forfeiture. (6) If, after the hearing, the court determines that the petitioner has established by a preponderance of the evidence that— App. 15 (A) the petitioner has a legal right, title, or in- terest in the property, and such right, title, or in- terest renders the order of forfeiture invalid in whole or in part because the right, title, or interest was vested in the petitioner rather than the defendant or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which give rise to the forfeiture of the property un- der this section; or (B) the petitioner is a bona fide purchaser for value of the right, title, or interest in the property and was at the time of purchase reasonably without cause to believe that the property was subject to forfeiture under this section; the court shall amend the order of forfeiture in accordance with its determination. (7) Following the court’s disposition of all petitions filed under this subsection, or if no such petitions are filed following the expiration of the period provided in para- graph (2) for the filing of such petitions, the United States shall have clear title to property that is the subject of the order of forfeiture and may warrant good title to any subsequent purchaser or transferee. (n) If any of the property described in subsection (a), as a result of any act or omission of the defendant— (1) cannot be located upon the exercise of due diligence ; (2) has been transferred or sold to, or deposited with, a third party; App. 16 (3) has been placed beyond the jurisdiction of the court; (4) has been substantially diminished in value; or (5) has been commingled with other property which cannot be divided without difficulty; the court shall order the forfeiture of any other property of the defendant up to the value of any property described in paragraphs (1) through (5). (a) The district courts of the United States shall have jurisdiction to prevent and restrain violations of section 1962 of this chapter by issuing appropriate orders, ineluding, but not limited to: ordering any person to di- vest himself of any interest, direct or indirect, in any en- terprise; imposing reasonable restrictions on the future activities or investments of any person, including, but not limited to, prohibiting any person from engaging in the same type of endeavor as the enterprise engaged in, the activities of which affect interstate or foreign commerce ; or ordering dissolution or reorganization of any enterprise, making due provision for the rights of innocent persons. (b) The Attorney General may institute proceedings under this seetion. Pending final determination thereof, the court may at any time enter such restraining orders or prohibitions, or take such other actions, including the acceptance of satisfactory performance bonds, as it shall deem proper. (ec) Any person injured in his business or property by reason of a violation of section 1962 of this chapter App. 17 may sue therefor in any appropriate United States district court and shall recover threefold the damages he sustains and the cost of the suit, including a reasonable attorney's fee. (d)