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RICO Claims: The Enterprise Element

The term ‘racketeering’ is most often associated with criminal operations. However, increasingly, wholly legitimate Florida businesses are facing civil RICO claims. The language of the RICO (Racketeer Influenced and Corrupt Organization) Act is expansive. These claims have many complicated factors, including the ‘enterprise element’. If you have any questions about RICO’s enterprise element, or Florida RICO claims in general, please contact an experienced business law attorney for immediate legal assistance.

The Required Elements of a Civil RICO Claim

In order for a plaintiff to recover damages under the RICO Act, it must be proven that the defendant:

  • Engaged in conduct: This means that the defendant must have had some role in directing, controlling, or participating in the affairs of the organization in question.
  • As part of an ‘enterprise’: An enterprise is defined as any legal entity, such as a partnership or corporation. However, it could also include non-legal entities in some situations.
  • That established a pattern: The ‘continuity plus’ test is used to prove a pattern of activity. A pattern must be at least two acts in the same ten year period.
  • Of racketeering activity: Qualifying racketeering activity is defined under Section 1961 of the United States Code.

A dispute could arise over any of these elements. In some cases, it may be difficult to prove that a ‘pattern’ of racketeering activity took place, whereas in other cases, it may be challenging to prove that any racketeering activity occurred at all. Increasingly, though, the enterprise element has become a hotly litigated issue.

How Broad is the Definition of an ‘Enterprise’?

Undoubtedly, the statute, and the courts, have defined ‘enterprise’ broadly. However, in some cases, this definition becomes very difficult to apply, specifically when it comes to non-legal entities. Most frequently, enterprise element-related litigation occurs when two distinct business operations have engaged in routine transactions, and the allegation of a RICO violation arises. In 2009, the Supreme Court of the United States, in the case of Boyle v. United States, sought to clarify the meaning of the term ‘enterprise’ in the RICO Act. According to the Court, proving an enterprise exists requires proving that a business association has a fundamental ‘structure’. Specially, the plaintiff must prove that:

  • A relationship exists between all parties that are allegedly involved;
  • The business association has a common purpose; and
  • There is sufficient operational longevity.

Further, the ‘structure’ must exist beyond the alleged racketeering activity. This means that simply proving racketeering activity occurred is not sufficient to prove a common business purpose or a qualifying relationship. Ultimately, these are very complex claims. If you, or your business, is involved in a Florida RICO claim, an experienced attorney should comprehensively review the facts of your individual case.

Contact Our Office Today

The RICO claims attorneys at Pike & Lustig, LLP have extensive experience handling these claims for both plaintiffs and defendants. Please do not hesitate to contact our West Palm Beach office today at (561) 291-8298 to learn more about how we can help you. Initial legal consultations are free of charge, and we proudly serve business throughout South Florida, including in Boca Raton and Fort Lauderdale.

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