Raineri Constr., LLC v. Taylor

• Decision Date: 24 October 2014
• Docket Number: Case No. 4:12–CV–2297 CEJ.
• Citation: 63 F.Supp.3d 1017
• Parties: RAINERI CONSTRUCTION, LLC, Plaintiff, v. Keith TAYLOR, et al., Defendants.
• Court: U.S. District Court — Eastern District of Missouri

63 F.Supp.3d 1017

RAINERI CONSTRUCTION, LLC, Plaintiff

v.Keith TAYLOR, et al., Defendants.

Case No. 4:12–CV–2297 CEJ.

United States District Court, E.D. Missouri, Eastern Division.

Signed Oct. 24, 2014.

Theresa A. Phelps, John J. Gazzoli, Jr., Rosenblum and Goldenhersh, P.C., St. Louis, MO, for Plaintiff.

Gerald Kretmar, Kretmar and Beatty, St. Louis, MO, Gregory Nathan Freerksen, Whitfield and McGann, Chicago, IL, for Defendants.

MEMORANDUM AND ORDER

CAROL E. JACKSON, District Judge.

This matter is before the Court on defendants' motion to dismiss Counts I through VII of plaintiff's second amended complaint for failure to state a claim for relief, pursuant to Fed.R.Civ.P. 12(b)(6). Plaintiff has filed a response in opposition and the issues are fully briefed.

I. Background

Plaintiff Raineri Construction, LLC (Raineri) is a construction contractor. Defendant Carpenters District Council of Greater St. Louis and Vicinity (CDC) is a labor union that represents carpenters and other skilled workers in collective bargaining with construction contractors. The ten individual defendants, Keith Taylor, Scott Byrne, Paul Higgins, Al Bond, Mark Kabuss, Michael Ebert, Christopher Woods, George Wingbermuehle III, Tod Wingbermuehle, and Terry Nelson, are officers or members of the CDC.

In the second amended complaint, plaintiff asserts claims of violation of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961 –1968 (Counts I–IV), tortious interference with business relations (Count V), civil conspiracy (Count VI), injurious falsehood (Count VII), and unfair labor practice in violation of the Labor–Management Relations Act (LMRA), 29 U.S.C. § 158(b)(4) (Count VIII). Plaintiff alleges that beginning in November 2011 and continuing to date, defendants have engaged in a conspiracy to extort money and inflict substantial damages upon plaintiff by threatening physical violence and property damage, stalking and harassing plaintiff's management and employees, defamation, filing frivolous complaints with the St. Louis City Building Department, the St. Louis County Department of Health, and the U.S. Department of Labor–Occupational Safety and Health Administration, and unlawfully interfering with plaintiff's existing and prospective business relations.

Defendants filed the instant motion seeking to dismiss plaintiff's second amended complaint. Defendants argue that plaintiff has failed to state a claim in Counts I through VII.¹

II. Legal Standard

The purpose of a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure is to test the legal sufficiency of the complaint. The factual allegations of a complaint are assumed true and construed in favor of the plaintiff, “even if it strikes a savvy judge that actual proof of those facts is improbable.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (citing Swierkiewicz v. Sorema N.A., 534 U.S. 506, 508 n. 1, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002) ); Neitzke v. Williams, 490 U.S. 319, 327, 109 S.Ct. 1827, 104 L.Ed.2d 338 (1989) (“Rule 12(b)(6) does not countenance ... dismissals based on a judge's disbelief of a complaint's factual allegations”); Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974) (a well-pleaded complaint may proceed even if it appears “that a recovery is very remote and unlikely”). The issue is not whether the plaintiff will ultimately prevail, but whether the plaintiff is entitled to present evidence in support of his claim. Id. A viable complaint must include “enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp., 550 U.S. at 570, 127 S.Ct. 1955 ; see also id. at 563, 127 S.Ct. 1955 (stating the “no set of facts” language in Conley v. Gibson, 355 U.S. 41, 45–46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957), “has earned its retirement.”). “Factual allegations must be enough to raise a right to relief above the speculative level.” Id. at 555, 127 S.Ct. 1955.

When ruling on a motion to dismiss, a court generally may not consider matters outside the pleadings. Porous Media Corp. v. Pall Corp., 186 F.3d 1077, 1079 (8th Cir.1999) (citations omitted). It may, however, consider matters of public records, materials that do not contradict the complaint, exhibits attached to the pleadings, and materials necessarily embraced by the complaint. Mills v. City of Grand Forks, 614 F.3d 495, 498 (8th Cir.2010). In this case, defendants attached to their motion letters defendant sent to plaintiff's customers—documents referred to by plaintiff in its complaint. These letters are materials necessarily embraced by the complaint, and the Court may consider them in ruling on the motion to dismiss the second amended complaint.

III. Discussion

A. RICO Claims

Defendants first argue that plaintiff has failed to properly plead its RICO claims. RICO prohibits a person from engaging in a pattern of racketeering activity or from using proceeds derived from racketeering activity so to affect an interstate enterprise in one of three ways: (1) investing the income derived from a pattern of racketeering in the enterprise, § 1962(a) ; (2) acquiring or maintain an interest in an enterprise through a pattern of racketeering, § 1962(b) ; or (3) conducting the affairs of an enterprise through a pattern of racketeering, § 1962(c). Section 1962(d) also prohibits conspiring to violate subsections (a), (b), or (c). Count I alleges a violation of § 1962(c), while Counts II–IV allege that defendants violated § 1962(d) by conspiring to violate (c), (a), and (b), respectively.

To prevail on a RICO claim under any of the subsections of § 1962, a plaintiff must prove both the existence of an enterprise and a pattern of racketeering within the enterprise. McDonough v. Nat'l Home Ins. Co., 108 F.3d 174, 177 (8th Cir.1997) ; see also Beck v. Prupis, 529 U.S. 494, 504–06, 120 S.Ct. 1608, 146 L.Ed.2d 561 (2000) (resolving a circuit split in holding that a RICO conspiracy charge under § 1962(d) also requires pleading predicate acts of racketeering). In dismissing plaintiff's first amended complaint, the Court found that plaintiff had sufficiently pled the existence of an enterprise within the meaning of RICO. Raineri Constr., LLC v. Taylor, No. 4:12–CV–2297 (CEJ), 2014 WL 348632, *5 (E.D.Mo. Jan. 31, 2014). The Court found, however, that plaintiff failed to meet the continuity requirement for pleading a pattern of racketeering activity. Raineri Constr., LLC, 2014 WL 348632 at *8. In the instant motion, defendants argue that plaintiff has failed to sufficiently plead a pattern of racketeering activity, because the alleged instances of misconduct are not predicate acts for a RICO claim. If a plaintiff fails to present sufficient evidence as to any one element of a RICO claim, the entire claim fails. Craig Outdoor Adver., Inc. v. Viacom Outdoor, Inc., 528 F.3d 1001, 1028 (8th Cir.2008).

1. Predicate Acts

As set forth in RICO, a “pattern of racketeering activity” requires the commission of at least two acts of a racketeering offense over a ten-year period. § 1961(5) ; see Sedima, S.P.R.L. v. Imrex Co., Inc.,

473 U.S. 479, 488, 105 S.Ct. 3275, 87 L.Ed.2d 346 (1985) (adopting the term “predicate acts”). The racketeering activity in which plaintiff alleges defendants engaged includes extortion, aggravated stalking, stealing, harassment, threats of physical violence and property damage, defamation, and the filing of frivolous complaints to governmental agencies. [Doc. # 60, ¶¶ 33–34, 37]. Section 1961(1) of RICO contains an exhaustive list of the offenses that qualify as “racketeering activity.” Beck, 529 U.S. at 497 n. 2, 120 S.Ct. 1608 (2000). Section 1961(1)(A) defines the state laws, punishable by imprisonment for more than one year, that qualify as racketeering activity and may serve as predicate acts for a RICO claim. The enumerated laws include “any act or threat involving murder, kidnapping, gambling, arson, robbery, bribery, extortion, dealing in obscene matter, or dealing in a controlled substance.” § 1961(1)(A). Plaintiff has not alleged any of these crimes under Missouri law. Section 1961(1) also includes acts that are indictable under Title 18 of the United States Code, labor violations under Title 29, and securities and narcotics violations punishable under federal law. The only charge plaintiff has alleged that qualifies as racketeering activity under § 1961(1) is the federal crime of extortion under the Hobbs Act, 18 U.S.C. § 1951.

Under the Hobbs Act, extortion is defined as “the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence, or fear, or under color of official right.”§ 1951(b)(2). Plaintiff alleges that defendants committed extortion through their attempts to obtain money and property from plaintiff, including contributions for insurance and pension benefits, dues and fees for CDC members or prospective CDC members plaintiff employed, by causing plaintiff's employees, job applicants, and management to fear for their safety and by causing plaintiff's customers to cease business with plaintiff out of fear for the well-being of their businesses. [Doc. # 60, ¶ 35]. Defendants, in contrast, characterize their acts as involving a “non-violent labor dispute with [plaintiff] in an attempt to sign that company to a collective bargaining agreement” and “an information campaign to bring the labor dispute to the public's attention, including [plaintiff's] customers and potential customers.” [Doc. # 64, p. 5].

Defendants rely upon United States v. Enmons, 410 U.S. 396, 93 S.Ct. 1007, 35 L.Ed.2d 379 (1973), in support of their argument that plaintiff has failed to plead extortion. The Supreme Court in Enmons held that the Hobbs Act “does not apply to the use of force to achieve legitimate labor ends.” 410 U.S. at 401, 93 S.Ct. 1007. The reasoning in Enmons created what courts have titled “the claim of right defense” to extortion under the ...