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Civil RICO Claims in California

fraud.jpgFor most people, the Racketeer Influenced Corrupt Organization (RICO) Act is associated with organized crime. This is not surprising since the control of crime was the original purpose of the statute. However, civil action may also be brought under the RICO act. Further, in California, civil RICO claims are increasingly being brought not just against organized crime, but against clearly legitimate businesses. If you are considering bringing a civil RICO claim, or if a RICO claim has been brought against your California business, you need to consult with an experienced San Jose business litigation attorney as soon as possible.

When to Bring a Civil RICO Claim

A civil RICO claim can be brought against a business that has engaged in a pattern of racketeering activity. Racketeering activity comes in many different forms, including bribery, extortion, and fraud. Most RICO claims that are brought against legitimate business operations are brought because there are allegations of fraud. Though, proving that fraud occurred is not enough to prevail in a RICO action.

In addition, the plaintiff must also establish that the fraud occurred as part of a 'pattern of activity'. The Supreme Court, in the case of H.J. Inc. v. NW Bell Tel. Co., set forth the 'relationship plus continuity' test to assess whether a pattern of racketeering activity occurred. To satisfy the relationship plus continuity test, a plaintiff must prove the following three things:

  • The business engaged in repeated misconduct;
  • That misconduct was reasonably connected; and
  • There is good reason to believe that further misconduct will continue in the future.

Why Bring a RICO Claim?

It may occur to you that bringing a RICO claim appears to be unnecessary. After all, you could just bring a standard fraud claim against the business, right? While it is true that you could take action due to the fraud, a RICO claim makes sense for plaintiffs because substantial additional damages are available.

Under the RICO statute, courts can award the victims of the RICO violation treble damages along with the full cost reasonable legal expenses. This means that successful plaintiffs can often receive three times their actual damages and can have their attorneys' fees paid. The stakes are especially high in RICO cases. Unfortunately, some California businesses are now having illegitimate RICO claims levied against them. If your business is faced with defending a RICO claim, you need to speak to an aggressive attorney immediately.

Contact Our Office Today

At Diemer, Whitman & Cardosi, LLP, our dedicated San Jose business litigation attorneys have helped protect the rights and interests of many California companies. If your business is currently involved in a civil RICO case, please do not hesitate to contact our office today. We offer free case evaluations and represent businesses throughout the Bay Area, including in San Francisco and San Jose.



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