Gamboa v. Velez

Decision Date10 August 2006
Docket NumberNo. 05-1690.,05-1690.
Citation457 F.3d 703
PartiesRonny GAMBOA, Plaintiff-Appellee, v. Carlos VELEZ, Chicago Police Officer # 20162, R. Rodriguez, Chicago Police Officer # 20230, Paul Lopez, Chicago Police Officer # 2001, et al., Defendants-Appellants.
CourtU.S. Court of Appeals — Seventh Circuit

Jane E. Notz, Christopher S. Norborg (argued), Office of the Corporation Counsel Appeals Division, Chicago, IL, for Defendants-Appellants.

Before MANION, KANNE, and ROVNER, Circuit Judges.

MANION, Circuit Judge.

After a jury acquitted Ronny Gamboa of murder, Gamboa sued several Chicago police detectives under the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. §§ 1961 et seq. He claimed that the detectives lied and otherwise conspired in their investigation and testimony to falsely accuse him and others of committing the murder. The detectives moved to dismiss, arguing that Gamboa had failed to state a RICO claim. The district court denied the motion but allowed the detectives to pursue an interlocutory appeal. The officers then petitioned this court for permission to appeal, and we granted their petition. We now reverse.


In July 1997, Sindulfo Miranda was murdered in Chicago. The Chicago police department assigned detectives Alfonso Bautista, Paul Lopez, R. Rodriguez, and Carlos Velez to the case. As a result of the detectives' investigation, Ronny Gamboa was charged in November 1997 with murder and solicitation of murder for hire. Their investigation turned up evidence that Miranda was allegedly in a tavern owned by Gamboa on the night of his murder. Other evidence suggested that Gamboa allegedly solicited and participated in Miranda's kidnapping, beating, and murder. (Gamboa's supposed motive for killing Miranda is not readily apparent from the record before us.) In the face of these and similar allegations, Gamboa went to trial and was acquitted in August 2000.

Other defendants initially implicated in Miranda's murder were not so fortunate. The detectives' investigation linked Omar Aguirre, Robert Gayol, Luis Ortiz, and Duarte Santos to Gamboa and Miranda's murder. Aguirre was convicted of murder and sentenced to 55 years in prison. Gayol was convicted of murder and sentenced to life. Ortiz pleaded guilty to murder and received a 25-year sentence, and Santos pleaded guilty to a lesser charge, receiving a 12-year sentence. However, as the detectives now readily acknowledge, each of these convictions (even the guilty pleas) has been overturned. Apparently, Miranda's true killers have since been identified. See United States v. Carman, 2004 WL 1638231, at *2 (N.D.Ill. July 16, 2004) (describing Miranda's brutal murder as part of a gang's attempt to steal some 1,000 kilograms of marijuana from Miranda).

All this and more prompted Gamboa to sue the City of Chicago and the four detectives responsible for his apparently erroneous prosecution. Filed in January 2003, his complaint led with a RICO claim under 18 U.S.C. § 1962(c). It also included counts under 42 U.S.C. § 1983, as well as state law claims of malicious prosecution and intentional infliction of emotional distress. On the City and detectives' motion, the district court dismissed the § 1983 and state law claims with prejudice on statute-of-limitations grounds. In addition, the district court dismissed the RICO count for failing to state a claim but did so without prejudice for Gamboa to file an amended complaint. Gamboa did file an amended complaint, with the § 1962(c) claim as the only count, and the City and detectives again moved to dismiss. While that motion was pending Gamboa agreed to dismiss the City from the case without prejudice.1

As to the detectives, the district court denied their second motion to dismiss, concluding that Gamboa's amended complaint sufficiently stated a RICO claim. The legal dispute here centered upon whether Gamboa adequately alleged a pattern of racketeering activity, an element of his RICO claim described in greater detail below. With respect to that issue, the detectives, at the district court's suggestion, filed a motion requesting permission to pursue an interlocutory appeal under 28 U.S.C. § 1292(b). See Fed. R.App. P. 5(a)(3). The district court granted their request. The detectives then petitioned this court for permission to appeal, presenting the following question for review: "whether a single scheme that ends without indication that it will be repeated establishes a pattern of racketeering activity merely because the scheme occurs over several years, involves a variety of predicate acts, and targets more than one victim." We granted the detectives' petition.


Before tackling the interlocutory question presented by the detectives, we first review several fundamental points about stating a RICO claim under § 1962(c) and then further examine the pleading at issue in this appeal, i.e., Gamboa's amended complaint. The theory of Gamboa's claim is that the four detectives coordinated a scheme of widespread criminal misconduct to erroneously prosecute Gamboa, Aguirre, Gayol, Ortiz, and Santos for Miranda's murder and then cover it up. (To be clear, Gamboa is the only plaintiff in this action.) To advance his claim under § 1962(c), Gamboa characterizes the alleged misconduct as racketeering activity.

RICO, nonetheless, does not cover all instances of wrongdoing. Rather, it is a unique cause of action that is concerned with eradicating organized, long-term, habitual criminal activity. See Pizzo v. Bekin Van Lines Co., 258 F.3d 629, 633 (7th Cir.2001) (emphasizing the habitual nature of the requisite criminal activity) (quoting H.J. Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 242, 109 S.Ct. 2893, 106 L.Ed.2d 195 (1989)); Midw. Grinding Co., Inc. v. Spitz, 976 F.2d 1016, 1019 (7th Cir.1992). In keeping with this limited purpose, there are four elements to a § 1962(c) claim: (1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity. See Sedima v. Imrex Co., 473 U.S. 479, 496, 105 S.Ct. 3275, 87 L.Ed.2d 346 (1985); Bressner v. Ambroziak, 379 F.3d 478, 481-82 (7th Cir.2004). To give the detectives fair notice of the claim against them and avoid dismissal under Fed.R.Civ.P. 12(b)(6), Gamboa "must . . . allege each of these elements to state a claim." Sedima, 473 U.S. at 496, 105 S.Ct. 3275.

The only element disputed in this appeal is the third element — the pattern element. For this element to be satisfied, the alleged acts of wrongdoing must not only be related, but, important for purposes of this appeal, must "amount to or pose a threat of continued criminal activity." Corley v. Rosewood Care Ctr., Inc. of Peoria, 388 F.3d 990, 1002 (7th Cir.2004) (quoting H.J. Inc., 492 U.S. at 239, 109 S.Ct. 2893); see also Roger Whitmore's Auto. Servs., Inc. v. Lake County, 424 F.3d 659, 672-74 (7th Cir.2005) (citing H.J. Inc., 492 U.S. at 237-42, 109 S.Ct. 2893). This is true whether the misconduct at issue is considered a "close-ended" scheme (a completed scheme that, by its duration, can carry an implicit threat of future harm) or "open-ended" scheme (a scheme that, by its intrinsic (e.g., business-as-usual) nature, threatens repetition and thus future harm). See Roger Whitmore's, 424 F.3d at 672-73; Midw. Grinding, 976 F.2d at 1022-23. Consequently, isolated instances of criminal behavior, not presenting at least some threat of future harm, cannot meet § 1962(c)'s continuity element. See Roger Whitmore's, 424 F.3d at 673-74; Pizzo, 258 F.3d at 633 (observing that "continuity" is a proxy in the language of the case law for frequent, habitual criminal conduct); Midw. Grinding, 976 F.2d at 1022-23.

In this case, the detectives maintain that Gamboa has not satisfied the continuity element because the allegations in his amended complaint—even when construed in his favor for Rule 12(b)(6) purposes—present only a single, nonrecurring scheme (a frame-up of five individuals for a single murder), which, as alleged, does not carry any threat of continued criminal activity. Since the factual allegations in Gamboa's amended complaint are crucial to the question before us, we review those allegations in detail. For purposes of this discussion, we accept the amended complaint's allegations as true and draw all reasonable inferences therefrom in Gamboa's favor. See Bressner, 379 F.3d at 480.

The amended complaint begins by generally accusing the detectives of making false arrests, tampering with witness statements, procuring perjured testimony, committing perjury, and engaging in a malicious prosecution "in order to intimidate and retaliate against" one person, Gamboa. It further alleges that the detectives falsified police reports, coerced witnesses to testify against Gamboa and others falsely, and lied before a grand jury or in court "in an attempt to convict GAMBOA and others of the crime of murder and to keep him incarcerated, to cover up the false arrests of GAMBOA and others." The amended complaint defines the word "others" to mean Aguirre, Gayol, Ortiz, and Santos.

The amended complaint then moves to specifics, stating that Miranda was murdered in July 1997 and that Gamboa was arrested for and charged with Miranda's murder in November 1997. It also names the four detectives assigned to the Miranda murder investigation, Bautista, Lopez, Rodriguez, and Velez. The amended complaint then alleges that Rodriguez and Velez intimidated an individual named Miguel LaSalle into falsely stating that Miranda's kidnapping and beating took place in Gamboa's tavern at the direction and control of Gamboa. Elsewhere, the amended complaint alleges that LaSalle stated that Gamboa solicited and participated in Miranda's murder and that the detectives used these statements knowing that they were false. Also, according to the amended complaint, the detectives coerced two individuals named Jose Chapa and Leticia...

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