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Supreme Court rules in RICO, speedy trial, civil service cases

[JURIST] The US Supreme Court [official website; JURIST news archive] on Monday ruled that a company cannot bring a claim under s.1962(c) of the Racketeer Influenced and Corrupt Organizations Act (RICO) [text] alleging that a competitor fraudulently failed to collect sales tax on its products. In Anza v. Ideal Steal Supply Corp. [Duke Law case backgrounder; JURIST report], Ideal sued National Steel Supply (owned by the Anza family) under RICO, alleging that National Steel Supply did not collect a New York sales tax from customers paying in cash which allowed it to significantly undercut Ideal's business. The Court overturned the Second Circuit's ruling [PDF] on the alleged 1962(c) violation - that provision prohibits conducting or participating in the conduct of an company's affairs through a pattern of racketeering activity - ruling that the connection between Ideal's injury and National Steel's conduct was too attenuated. The Court also directed the Second Circuit to reconsider Ideal's argument that National Steel violated s.1962(a) of RICO, which prohibits a person for using or investing income derived from racketeering activity in a business engaged in or affecting interstate commerce, in light of the Court's decision. Read the Court's opinion [text] per Justice Kennedy, along with a concurrence [text] from Justice Scalia, a partial dissent [text] from Justice Thomas and a second partial dissent [text] from Justice Breyer. AP has more.

In light of its decision in Anza, the Court ordered the US Court of Appeals for the Eleventh Circuit to reconsider Mohawk Industries v. Williams [Duke Law case backgrounder; JURIST report]. In Mohawk, the Court heard arguments on whether a corporation and its agents constitute an "enterprise" under the RICO; in order for civil RICO liability to attach, the defendant must "conduct" or "participate in" affairs of a larger enterprise beyond its own internal affairs. Mohawk employees sued the company, alleging that the company conspired with third-party recruiters to hire illegal immigrants in order to reduce labor costs. The Eleventh Circuit last year affirmed [opinion, PDF] the district court's holding that the company's collaborations with the recruiters constitutes an "enterprise" under RICO. In its per curiam decision [PDF text], however, the Court dismissed its grant of review on that issue, and instead remanded the case to the Eleventh Circuit for consideration, under Anza, of whether the plaintiffs properly stated proximately caused injuries, an issue which the Court had initially declined to hear when it granted certiorari last December.

In Zedner v. United States [Duke Law case backgrounder], the Court held that a defendant cannot prospectively waive application of the Speedy Trial Act [DOJ backgrounder] and, therefore, that a defendant's waiver of his right under the Act "for all time" is ineffective. The Act requires that a federal criminal trial begin within 70 days of an indictment or a defendant's initial appearance, but allows for delays that are "excluded" by the court. In Zedner's case, after two continuances had been granted and Zedner requested another delay, the Court suggested that Zedner waive application of the Act "for all time." After Zedner agreed to waive application, the district court did not enter orders excluding further delays. The Court reversed the Second Circuit's ruling [PDF text], saying that Zedner's waiver of his rights under the Act was ineffective. Read the Court's opinion [text] per Justice Alito, along with a concurrence [text] from Justice Scalia.

In the final decision handed down Monday, the Court remanded Whitman v. Department of Transportation [Duke Law case backgrounder] back to the US Court of Appeals for the Ninth Circuit. The federal appeals court had upheld [opinion, PDF] the lower court's dismissal of Whitman's lawsuit alleging that the Department of Transportation had violated his constitutional rights by misapplying its random drug testing policies. In dismissing the case, the lower courts reasoned that they lacked jurisdiction to hear the dispute because the suit was governed by the Civil Service Reform Act [text] and should have been resolved under the applicable collective bargaining agreement. The Supreme Court remanded the case, directing the Ninth Circuit to resolve certain questions that would determine whether CSRA removes jurisdiction given to courts under the federal question statute or precludes employees affected by CSRA from pursuing alternate remedies other than those outlined in the statute. Read the Court's per curiam opinion [PDF].

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