United States v. Winstead, 76C2513.

• Decision Date: 13 July 1976
• Docket Number: No. 76C2513.,76C2513.
• Parties: UNITED STATES of America, Plaintiff, v. James C. WINSTEAD et al., Defendants.
• Court: U.S. District Court — Northern District of Illinois

421 F. Supp. 295

UNITED STATES of America, Plaintiff, v. James C. WINSTEAD et al., Defendants.

No. 76C2513.

United States District Court, N. D. Illinois, E. D.

July 13, 1976.

Samuel K. Skinner, U. S. Atty., Chicago, Ill., for plaintiff.

Sam F. Adam, Howard D. Geter, Chicago, Ill., for defendants.

MEMORANDUM OPINION

FLAUM, District Judge:

Before the court is the plaintiff's motion for a temporary restraining order brought pursuant to 18 U.S.C. § 1964 which empowers the district court "to prevent and restrain" violations of 18 U.S.C. § 1962. The complaint in the instant action alleges that defendants have operated and are operating a gambling organization or policy wheel in violation of 18 U.S.C. § 1962 which provides:

(b) It shall be unlawful for any person through a pattern of racketeering activity or through collection of an unlawful debt to acquire or maintain, directly or indirectly, any interest in or control of any enterprise which is engaged in, or the activities of which affect, interstate or foreign commerce.

(c) It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct or such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt.

(d) It shall be unlawful for any person to conspire to violate any of the provisions of subsections (a), (b), or (c) of this section.

The threshold question before the court is a jurisdictional one, requiring a determination of whether section 1962 is directed to protecting those enterprises which are legitimate businesses from infiltration by racketeers or to prohibiting racketeering itself in unlawful enterprises such as the policy wheel allegedly operated by the defendants. In this circuit the issue has been resolved in United States v. Cappetto, 502 F.2d 1351 (7th Cir. 1974) wherein the court expressly noted that "There is nothing in the language of subsection (b) or (c) of section 1962 or in the definition section of the Act . . . to suggest that the enterprise must be a legitimate one. Congress' intention to include an illegal gambling business in the categories of "racketeering activity" and "enterprise" appears not only from the language of the statute but from the Senate Committee Report . . . ." 502 F.2d at 1358. But see United States v. Moeller, 402 F.Supp. 49 (D.Conn.1975). Recognizing this binding authority, the defendants have argued that Cappetto is factually distinguishable from the instant case as the illegal gambling operation enjoined in Cappetto was connected to a legitimate business, the Western Avenue Billiard Hall. 502 F.2d at 1354. This premise cannot be reconciled with the clear language of Cappetto and the court's unequivocal finding that "enterprise" in section 1962 is not restricted solely to legitimate business. Accordingly, the court finds that jurisdiction pursuant to section 1964 may be invoked to prevent or restrain allegedly illegal enterprises not otherwise connected with legitimate business.

The equitable relief sought by the plaintiff is available in this district, but the availability of that remedy does not render the propriety of the injunctive relief a foregone conclusion. As the Seventh Circuit noted in Cappetto, "Whether equitable relief is appropriate depends . . . on whether a preponderance of the evidence shows a likelihood that the defendants will commit wrongful acts in the future." 502 F.2d at 1358. The court in Cappetto indicated that the likelihood of continued violations of section 1962 may be established by inferences drawn from past conduct. Where continuous gambling activity "to the date of the filing of the complaint" is alleged and,...