U.S. v. Bonanno Organized Crime Family of La Cosa Nostra

Citation879 F.2d 20
Decision Date23 June 1989
Docket NumberNo. 903,D,903
Parties, RICO Bus.Disp.Guide 7252 UNITED STATES of America, Plaintiff-Appellant, v. The BONANNO ORGANIZED CRIME FAMILY OF LA COSA NOSTRA, Joseph Bonanno, Philip Rastelli, Joseph Massino, Anthony Spero, Louis Attanasio, Alfred Embarrato, Gabriel Infanti, Frank Lino, Nicholas Marangello, Anthony Reila, Michael Sabella, Anthony Graziano, Benjamin Ruggiero, Ignatius Bracco, James Vincent Bracco, William Rodini, Vito Gentile, International Brotherhood of Teamsters Local 814 Van Drivers, Packers and Furniture Handlers, Warehousemen's and Appliance Home Delivery Union, Executive Board of International Brotherhood of Teamsters Local 814 Van Drivers, Packers and Furniture Handlers, Warehousemen's and Appliance Home Delivery Union, International Brotherhood of Teamsters Local 814 Van Drivers, Packers and Furniture Handlers, Warehousemen's and Appliance Home Delivery Union Welfare Fund, International Brotherhood of Teamsters Local 814 Van Drivers, Packers and Furniture Handlers, Warehousemen's and Appliance Home Delivery Union Pension Fund, International Brotherhood of Teamsters Local 814 Van Drivers, Packers and Furniture Handlers, Warehousemen's and Appliance Home Delivery Union Annuity Fund, Defendants-Appellees. ocket 88-6289.
CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)

Peter R. Ginsberg, Asst. U.S. Atty., E.D.N.Y., Brooklyn, N.Y. (Andrew J. Maloney, U.S. Atty., E.D.N.Y., Robert L. Begleiter, Thomas A. Carr, Asst. U.S. Attys., E.D.N.Y., Brooklyn, N.Y., of counsel), for plaintiff-appellant.

Michael J. Coyle, New York City (Stanley A. Teitler, New York City, of counsel), for defendant-appellee Rastelli.

Before MESKILL and NEWMAN, Circuit Judges, and KENNETH CONBOY, District Judge for the Southern District of New York (sitting by designation).

CONBOY, District Judge:

The United States filed the original complaint in this action on August 25, 1987 against "the Bonanno Organized Crime Family of La Cosa Nostra" ("the Bonanno Family"), Local 814 of the Van Drivers, Packers and Furniture Handlers, Warehousemen's and Home Delivery Union, and numerous individuals. An amended complaint was filed in October of 1987. The amended complaint contained fourteen separately denominated claims for relief, thirteen of which were predicated on violations of the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. Secs. 1961-1968 (1982 and Supp. VI 1987). The remaining claim was in rem against certain properties allegedly used by the defendants in connection with violations of 18 U.S.C. Sec. 1955 (1982 & Supp. V 1987), which essentially prohibits all forms of participation in the conduct of illegal gambling businesses. The government sought extensive injunctive relief pursuant to Section 1964(a), an award of treble damages pursuant to Section 1964(c), and forfeiture of the properties identified in the Section 1955 claim. In response to a number of motions attacking the pleadings, the District Court for the Eastern District of New York (I. Leo Glasser, Judge) ruled, inter alia, that the federal government lacks standing to sue under 18 U.S.C. Sec. 1964(c) and that the Bonanno Family is not a "person" within the meaning of RICO and thus not a proper RICO defendant. United States v. Bonanno Organized Crime Family, 683 F.Supp. 1411 (E.D.N.Y.1988). On the basis of these two rulings, which are the subject of this appeal, the District Court dismissed all claims against the Bonanno Organized Crime Family and all monetary damage claims based on RICO, and directed entry of judgment pursuant to Fed.R.Civ.P. 54(b).

I. Is the United States a "person" entitled to sue under Section 1964(c)?

As always, in executing our over-arching obligation to give effect to congressional intent, Blackfeet Tribe of Indians v. Montana, 729 F.2d 1192 (9th Cir.1984), aff'd, 471 U.S. 759, 105 S.Ct. 2399, 85 L.Ed.2d 753 (1985), "consideration must first be given to the language of the statute," Netherlands Shipmortgage Corp. v Madias, 717 F.2d 731, 732 (2d Cir.1983), and if the language is clear and unambiguous it must ordinarily be regarded as conclusive. Sierra Club v. U.S. Army Corps of Engineers, 732 F.2d 253, 258 (2d Cir.1984). But see Watt v. Alaska, 451 U.S. 259, 266, 101 S.Ct. 1673, 1678, 68 L.Ed.2d 80 (1981) (plain-meaning rule does not preclude consideration of persuasive extrinsic evidence if it exists); Shippers Nat'l Freight Claim Council, Inc. v. Interstate Commerce Comm'n, 712 F.2d 740, 747 (2d Cir.1983) ("Mere incantation of the plain meaning rule ... cannot substitute for meaningful analysis."), cert. denied, 467 U.S. 1251, 104 S.Ct. 3534, 82 L.Ed.2d 839 (1984). The plain-meaning rule, however, is easier stated than applied, since " 'whether ... the words of a statute are clear is itself not always clear.' " 2A Sutherland Statutory Construction Sec. 46.04, at 86 (4th ed. 1984) (quoting Barbee v. United States, 392 F.2d 532 (5th Cir.), cert. denied, 391 U.S. 935, 88 S.Ct. 1849, 20 L.Ed.2d 855 (1968)).

What the government heralds as the plain and obvious meaning of the relevant statutory text is in fact arrived at by a relatively involved, and selective, process of deduction. Section 1964(c) provides as follows:

Any person injured in his business or property by reason of a violation of section 1962 of this chapter may sue therefor 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.

"Person" is in turn defined to include "any individual or entity capable of holding a legal or beneficial interest in property." Section 1961(3). Sidestepping the question of whether the rather amorphous term "entity" plainly and ordinarily encompasses the United States, 1 the government maintains that it has standing to sue under Section 1964(c) because the United States is capable of holding a legal or beneficial interest in property. Whatever else might be said about this conclusion--that it is arguable or reasonable--it does not follow from the plain language of the statute. If the government's standing under Section 1964(c) is "plain," one would be at a loss for adjectives to describe the manner in which Congress ordinarily expresses its intention to render a statutory provision applicable to the United States: by explicit reference to the United States in the operative language of the statute or by explicit inclusion of the United States in the statutory definition of the object or objects affected by the law. See General Accounting Office v. General Accounting Office Personnel Appeals Bd., 698 F.2d 516, 524 (D.C.Cir.1983). To see examples, we need look no further than RICO itself, see Section 1963, nor for that matter beyond the subsections immediately preceding and following 1964(c), see Section 1964(b) ("The Attorney General may institute proceedings under this section.") and Section 1964(d) (final judgment in criminal proceeding estops defendant from denying essential elements of the crime "in any subsequent civil proceeding brought by the United States").

The argument against inclusion of the United States is strengthened in this case by the effective breadth of the ruling urged by the government. The government brings to bear an arsenal of statutory-construction principles on the question of whether it has standing to sue for treble damages under Section 1964(c), but the answer turns in large measure on the more general question of whether the United States is a "person" as that term is defined in 1961(3). Under RICO, "a 'person' can sue or be sued, and the statute does not distinguish between the definition of a potential plaintiff and defendant." Brief for the Appellant at 17. The disadvantage of being a "person" within the meaning of RICO is that it subjects qualifying entities to the powerful and expansive criminal and civil liability provisions of the Act. Whether the government has standing to sue and whether it has waived its sovereign immunity may, in the abstract, be different questions, but in this case the answer to one is apparently the answer to both. See Firestone v. Howerton, 671 F.2d 317, 320 n. 6 (9th Cir.1982) (when same terms are used in different sections of statute, they receive the same meaning); 2A Sutherland Statutory Construction, Sec. 47.07, at 133 (4th ed. 1984) ("Legislative declaration of the meaning that a term shall have ... is binding, so long as the prescribed meaning is not so discordant to common usage as to generate confusion.").

It is elementary that "[t]he United States, as sovereign, is immune from suit save as it consents to be sued ..., and the terms of its consent to be sued in any court define the court's jurisdiction to entertain the suit." United States v. Sherwood, 312 U.S. 584, 586, 61 S.Ct. 767, 769-770, 85 L.Ed. 1058 (1941). A waiver of sovereign immunity "cannot be implied but must be unequivocally expressed." United States v. King, 395 U.S. 1, 4, 89 S.Ct. 1501, 1503, 23 L.Ed.2d 52 (1969).

United States v. Mitchell, 445 U.S. 535, 538, 100 S.Ct. 1349, 1351, 63 L.Ed.2d 607 (1980). Thus, our analysis must be informed by the following question: Do the relevant sources of congressional intent on the meaning of Section 1964(c), separately or collectively, evince an unequivocal expression of congressional intent to expose the government to RICO liability? That the United States is capable of owning property and is, perhaps, an "entity" is no better than ambiguous evidence on this issue since

[s]tatutory provisions which are written in such general language as to make them reasonably susceptible to being construed as applicable both to the government and to private parties are subject to a rule of construction which exempts the government from their operation in the absence of other particular indicia supporting a contrary result in particular instances.

3 Sutherland Statutory Construction, Sec...

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