Plaintiffs respond that they do not seek damages for their addiction, for pain and suffering, for fear of cancer, or for other personal injuries. Rather, plaintiffs seek only damages for the out-of-pocket expenses they incurred in treating their addictions, specifically the cost of the Nicotine Patch and related medical expenses. Plaintiffs contend this is an injury to property.
Although theoretically it is not always easy to distinguish a personal injury from an injury to property, for the purposes of bringing an action under RICO the courts have been clear that even the economic consequences of personal injuries are not compensable under RICO. See Doe v. Roe, 958 F.2d 763, 770 (7th Cir. 1992). The phrase "injury to business or property" has restrictive significance. Reiter v. Sonotone Corp., 442 U.S. 330, 339, 60 L. Ed. 2d 931, 99 S. Ct. 2326 (1979). The Supreme Court has made clear that this phrase does not include personal injuries suffered. Id. In this case, although plaintiffs characterize the injury as pecuniary and thus an injury to their property, the Court is unable to ignore that the core injury alleged in the complaint is addiction to nicotine. Plaintiffs have incurred the costs of the Nicotine Patch and other medical expenses as a direct result of their addictions. Such pecuniary consequences of personal injuries are not recoverable under RICO.
The federal courts that have addressed this question have all held that Congress intended the "business or property" language to exclude civil RICO actions seeking recovery of expenses resulting from personal injury. For example, in Genty v. Resolution Trust Corp, 937 F.2d 899, 918 (3rd Cir. 1991), cited favorably by the Ninth Circuit in Oscar v. University Students Co-Op Ass'n, the court held that plaintiffs could not recover under RICO for medical expenses incurred for treatment of illnesses caused by a toxic waste dump. The court found that precluding such a claim under RICO was consistent with Congress' intent in enacting RICO, which was to thwart the organized criminal invasion and acquisition of legitimate business enterprises and property. Genty, 937 F.2d at 918.
Other courts have similarly held that physical injuries are not compensable under RICO, even if plaintiffs incurred financial expenses as a result. See, e.g., Drake v. B.F. Goodrich Co., 782 F.2d 638, 644 (6th Cir. 1986) (wrongful death action not permitted under RICO); Frogner v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 1983Fed. Sec. L. Rep. (CCH) P 99,504 (N.D. Cal. Sept. 26, 1983) (medical expenses are not injury to "business or property" for purposes of § 1964(c)); Munson v. Eli Lilly and Co., 1987 U.S. Dist. LEXIS 11040, 1987 WL 20383 (D. Minn. 1987) (money paid to treat or cure injury caused by defendant's product not injury to business or property and not compensable under RICO).
As the Eleventh Circuit recognized in Grogan v. Platt, 835 F.2d 844, 847 (11th Cir. 1988), cases involving bodily injury, injury to reputation, mental or emotional anguish, or the like, all cause some financial loss. Had Congress intended to create a federal treble damages remedy for cases involving such claims, it could have enacted a statute referring to injury generally, without any restrictive language. Significantly, plaintiffs have not cited any cases which permit recovery under RICO for medical expenses resulting from personal injury.
Plaintiffs attempt to save their claim by contending that under California law, money is considered "property," and therefore, the cost of purchasing a Nicotine Patch should be treated as an injury to property for purposes of § 1964(c). Although plaintiffs are correct in their assertion that whether a particular interest is considered property is usually a question of state law, see Logan v. Zimmerman Brush Co, 455 U.S. 422, 430, 71 L. Ed. 2d 265, 102 S. Ct. 1148 (1982), the Court will not adopt a state interpretation of "property" that will contravene Congress' intent in enacting RICO. Doe v. Roe, 958 F.2d 763, 768 (7th Cir. 1992).
Accordingly, the Court finds that plaintiffs' claim under § 1964(c) must fail because the complaint does not allege an injury to business or property. Plaintiffs therefore lack standing to bring a civil suit under RICO and the entire complaint must be DISMISSED WITH PREJUDICE. CTR's Motion to Dismiss the Second Claim for Relief is MOOT.
IT IS SO ORDERED.
Dated: September 21, 1994
IRMA E. GONZALEZ
United States District Judge