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RODRIQUEZ v. TOPPS CO.

June 21, 2000

JON RODRIQUEZ, IRENE RODRIQUEZ AND GRETCHEN DUMAS, ON BEHALF OF THEMSELVES AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS,
V.
TOPPS COMPANY, INC., DEFENDANT.



The opinion of the court was delivered by: Brewster, Senior District Judge.

ORDER: (1) VACATING PREVIOUS ORDER OF MAY 14, 1999 PUBLISHED AT 52 F. Supp.2d 1183 NUNC PRO TUNC; (2) DISMISSING PLAINTIFFS' RICO CLAIM WITHOUT LEAVE TO AMEND; and (3) DISMISSING WITHOUT PREJUDICE ALL PENDENT CLAIMS

INTRODUCTION

Plaintiffs herein, alleged residents of New York and California, claim to be purchasers, or the guardian ad litem of purchasers, of trading cards. Plaintiffs allege that they purchased trading cards in the hope of winning "chase"*fn1 cards, redeemable in bonus cash prizes. Defendant is an alleged resident of New York and Delaware. On April 18, 2000, this Court ordered Plaintiffs to show cause as to why the claim brought under the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. § 1961-1968, should not be dismissed for lack of standing under § 1964(c) of RICO. The hearing for this Court's Order to Show Cause ("OSC") was held on June 7, 2000 with counsel for all parties present.

The Court re-reviewed all pleadings, motions, and briefs heretofore filed as well as all briefs filed in response to the OSC. The Court, having heard oral argument by counsel and being fully advised in the premises, now therefore issues the following ORDER:

(1) The prior order of May 14, 1999 denying Defendant's Fed.R.Civ.P. 12(b)(6) motion to dismiss is hereby vacated nunc pro tunc;
(2) The RICO claim is dismissed pursuant to Fed.R.Civ.P. 12(b)(6) without leave to amend on the ground that Plaintiffs lack standing as required by § 1964(c) of RICO; and
(3) All pendent claims are dismissed without prejudice pursuant to 28 U.S.C § 1367.

DISCUSSION

A. Standing Requirement under 18 U.S.C. § 1964(c)

Pursuant to this Court's April 18, 2000 Order to Show Cause, the issue before this Court is whether Plaintiffs have met the requirement of 18 U.S.C. § 1964(c) in order to have standing to bring a lawsuit against Defendant for its alleged gambling activity. Standing under 18 U.S.C. § 1964(c) requires an ability to state a claim for harm to a person's "business or property" resulting from conduct violative of 18 U.S.C. § 1962.

1. Section 1964(c)

Section 1964(c) provides in pertinent part: "Any person injured in his business or property by reason of a violation of section 1962 of this chapter may sue therefore 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. . . ." 18 U.S.C. § 1964(c) (emphasis added). Federal courts have established that RICO was "intended to combat organized crime, not to provide a federal cause of action and treble damages to every tort plaintiff." Oscar v. University Students Co-operative Assn., 965 F.2d at 783, 786 (9th Cir. 1992). Although this additional requirement of a showing of "business or property" injury is not imposed upon governmental entities, it is required in order for a private party to have standing to recover under RICO.

2. "Injury" to Business or Property under 18 U.S.C. § 1964(c)

In their reply papers, Plaintiffs set forth several arguments which skirt the immediate issue before this Court of whether there has been a showing of injury to their "business or property" sufficient to meet the standing requirements of § 1964(c).*fn2 Plaintiffs appear to equate the issue of whether they have set forth a proper showing of a pattern of racketeering activity under § 1962 with whether they have satisfied the requirements of standing under § 1964(c). Plaintiffs also ...


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