Reynolds v. Condon, C 94-4118.
| Citation | 908 F. Supp. 1494 |
| Decision Date | 02 January 1996 |
| Docket Number | No. C 94-4118.,C 94-4118. |
| Court | U.S. District Court — Northern District of West Virginia |
| Parties | Bryan REYNOLDS, Plaintiff, v. Charles CONDON, Lisa Reynolds, Barbara Orzechowski, Klass, Hanks, Stoos, Stoik & Villone, a partnership organized in the State of Iowa, Marvin J. Klass, James C. Hanks, William K. Stoos, and James R. Villone, Defendants. |
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J. Russell Hixson of Dickinson, Mackaman, Tyler & Hagan, P.C., Des Moines, Iowa, for Plaintiff Bryan Reynolds.
Nicholas V. Critelli, Jr. of the Law Offices of Nick Critelli, P.C., Des Moines, Iowa, for Defendant Charles Condon.
Edward J. Keane of Gildemeister, Willia & Keane, Sioux City, Iowa, for Defendant Lisa Reynolds.
Maurice B. Nieland of Rawlings, Nieland, Probasco & Killinger, Sioux City, Iowa, for Defendants Barbara Orzechowski, Marvin J. Klass, James C. Hanks, William K. Stoos, James R. Villone, and the law firm of Klass, Hanks, Stoos, Stoik & Villone.
TABLE OF CONTENTS
I. INTRODUCTION AND BACKGROUND..............................................1498
A. Procedural Background ................................................1498
B. Factual Background ...................................................1500
II. APPLICABLE STANDARDS ....................................................1502
III. LEGAL ANALYSIS ..........................................................1503
A. Defendants' January 26, 1995, Motion To Dismiss ......................1503
B. The Defendants' Other Motions To Dismiss .............................1504
1. Is the RICO claim time-barred? ....................................1504
2. Sufficiency of RICO allegations ...................................1506
a. Purpose and scope of RICO ......................................1506
b. Elements Of Plaintiff's § 1962(c) RICO Claim ..............1507
i. RICO enterprise ............................................1508
ii. Conduct of the enterprise ..................................1510
iii. Pattern of racketeering activity ...........................1512
iv. Causation ..................................................1517
v. Summary ....................................................1519
c. RICO conspiracy ................................................1520
C. Lack Of A Federal Question ...........................................1521
IV. CONCLUSION...............................................................1523
This lawsuit alleges appalling and shocking conduct; but even so, the motions to dismiss raise probing and nettlesome questions as to whether such conduct states a federal claim upon which to invoke the limited jurisdiction of this court. The plaintiff in this lawsuit has asserted claims pursuant to the Racketeer Influenced and Corrupt Organizations Act (RICO) and state law alleging that defendants extorted favorable terms from him in settlement of a dissolution of marriage by threatening a criminal prosecution for sexual abuse of a minor child. The defendants have moved to dismiss plaintiff's complaint pursuant to Fed.R.Civ.P. 12(b)(6) on the ground that the plaintiff's claims each fail to state a claim upon which relief can be granted. More specifically, the defendants attack the plaintiff's RICO claim, the only one upon which federal jurisdiction is based, as time-barred, pleading no proper RICO enterprise or conduct of that enterprise by the RICO defendants, and failing to allege a pattern of racketeering activity or continuing criminal activity.
Plaintiff Bryan Reynolds filed this lawsuit on December 27, 1994, against various defendants alleging injuries as the result of their conduct during an acrimonious divorce. Bryan Reynolds named as defendants Lisa Reynolds, his ex-wife, and Charles Condon, his former father-in-law. In addition, he named as defendants his ex-wife's attorney, Barbara Orzechowski, Ms. Orzechowski's law firm, Klass, Hanks, Stoos, Stoik & Villone (herein "Law Firm"), and some of the partners therein, Marvin J. Klass, James C. Hanks, William K. Stoos, Anthony J. Stoik, and James R. Villone. The original complaint was amended on January 17, 1995, prior to any answer or motion by the defendants. This first amended complaint in this matter was in eleven counts.1 However, the only count involving a federal claim, and thus the count upon which federal jurisdiction was then asserted, was a claim brought pursuant to 42 U.S.C. § 1983 alleging violation of Bryan Reynolds's civil rights. That count alleged that the defendants, individually and as a group, acting under color of state law, had conspired with the Woodbury County Attorney's Office to subject Bryan Reynolds to the threat of a wrongful prosecution in order to gain advantage in the divorce proceedings involving Bryan and Lisa Reynolds. On January 26, 1995, defendants Orzechowski, the Law Firm, and Messrs. Klass, Hanks, Stoos, Stoik, and Villone (collectively, "the Law Firm Defendants"), moved to dismiss the complaint for failure to state a claim upon which relief can be granted. Defendant Condon joined in that motion to dismiss on February 1, 1995, as did defendant Lisa Reynolds on February 2, 1995. Plaintiff Bryan Reynolds resisted the motion to dismiss on February 24, 1995.
However, on February 24, 1995, Bryan Reynolds also sought leave to file a second amended and substituted complaint. Leave to amend was granted on March 22, 1995. The March 22, 1995, second amended complaint withdrew all reference to a claim of violation of civil rights pursuant to 42 U.S.C. § 1983. Instead, Count I of this complaint asserted violation of provisions of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961-68, as the only federal claim upon which jurisdiction of this court was founded.2 The gravamen of the RICO claim is that the Law Firm is a RICO "enterprise," and that defendants Condon Lisa Reynolds, and Orzechowski conducted that enterprise in violation of 18 U.S.C. § 1962(c) or conspired to do so in violation of 18 U.S.C. § 1962(d). Bryan Reynolds alleges that these defendants "maliciously and repeatedly made various threats to Plaintiff constituting several acts of extortion in violation of 18 U.S.C. § 1961(1)," March 22, 1995, Amended And Substituted Complaint (Complaint), ¶ 106, and "repeatedly caused letters and other matters and things to be delivered by the United States Postal Service in repeated violation of 18 U.S.C. § 1341," which prohibits mail fraud. Complaint, ¶ 107. All of the conduct specifically pleaded as RICO predicate acts is alleged to have occurred between October 21, 1990, and November 22, 1991.
On April 3, 1995, the Law Firm Defendants moved to dismiss the March 22, 1995, second amended and substituted complaint. They assert that the second amended and substituted complaint still fails to state a federal claim upon which relief can be granted, because the RICO count does not allege "continuing criminal activity," these defendants did not "direct the enterprise," the claim is time-barred by the applicable statute of limitations, and no conduct of these defendants as alleged in the RICO claim was the cause of any injury to Bryan Reynolds. They also moved to dismiss any of the state law claims made against any of the Law Firm Defendants on the ground that they also failed to state a claim and that there was no viable federal question upon which to base jurisdiction in this court over any state-law claims. Lisa Reynolds joined in this motion to dismiss on April 14, 1995. Defendant Condon also joined in the motion to dismiss on May 3, 1995, but at the same time moved to dismiss all other counts against him. Lisa Reynolds then joined in defendant Condon's motion to dismiss, as well as that of the Law Firm Defendants, on May 3, 1995.
Bryan Reynolds resisted the new motion to dismiss by the Law Firm Defendants, in which Lisa Reynolds joined, on April 21, 1995. He resisted the motion to dismiss by defendant Condon on May 19, 1995. Bryan Reynolds argues that he has sufficiently alleged a "pattern" of racketeering activity, that Lisa Reynolds and Condon are proper RICO defendants, that the Law Firm is a proper RICO enterprise, that the defendants have not attacked the adequacy of his RICO conspiracy claim, and that his RICO claim is not time-barred. As to defendant Condon's and defendant Lisa Reynolds's additional grounds for dismissal of the claims against them, Bryan Reynolds argues that this court has supplemental jurisdiction pursuant to 28 U.S.C. § 1367 to hear such claims.
The court heard oral arguments on the motions to dismiss on November 1, 1995. Plaintiff Bryan Reynolds was represented at the oral arguments by counsel J. Russell Hixson of Dickinson, Mackaman, Tyler & Hagan, P.C., in Des Moines, Iowa. Mr. Hixson appeared by telephone. All other counsel appeared in person. Defendant Charles Condon was represented by counsel Nicholas V. Critelli, Jr. of the Law Offices Of Nick Critelli, P.C., in Des Moines, Iowa; defendant Lisa Reynolds was represented by counsel Edward J. Keane of Gildemeister, Willia & Keane, in Sioux City, Iowa; and the Law Firm Defendants were represented by counsel Maurice B. Nieland of Rawlings, Nieland, Probasco & Killinger, in Sioux City, Iowa. The oral arguments were both spirited and informative for the court and of great assistance in resolving close, troublesome, and complex issues of federal law.
The factual background for disposition of this motion, of course, is based entirely on the facts as alleged in Bryan Reynolds's March 22, 1995, complaint. According...
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