McCulloch v. United States

Background

In March 1981, people who ran an interstate operation that duplicated and distributed pirated sound recordings were convicted of multiple crimes, including interstate transportation of pirated tapes, conspiracy to violate copyright laws, wire fraud, and carrying out a racketeering enterprise under the RICO law. After this Court’s later decision in Dowling held that criminal penalties could not apply under the transportation statute, the defendants asked a federal court to set aside those transportation convictions under a post-conviction remedy. The trial court vacated the transportation convictions but left the wire fraud and RICO convictions intact, and an appeals court affirmed that result.

Reasoning

The central question is whether a RICO conviction may remain valid when some — but not all — of the criminal convictions used as the RICO “predicate” acts have been voided. Here, several predicate-act convictions were vacated for each defendant (six vacated for each of two named defendants), but the jury did not indicate which specific predicates formed the basis for finding a pattern of racketeering. Lower courts relied on an approach from one appeals court that allows the RICO conviction to stand if enough valid predicate acts remain, while other appeals courts have taken an opposing approach.

Real world impact

Because the high court denied review, the lower-court rulings stand and defendants’ RICO convictions remain in place for now. The disagreement among federal appeals courts about how to handle vacated predicate acts continues, leaving uncertainty for defendants and prosecutors about when RICO convictions survive partial vacatur. This division could affect RICO prosecutions nationwide unless the issue is later accepted for review.

Dissents or concurrances

Justice White, joined by Justice Brennan, dissented from the denial of review and would have granted review to resolve the conflict among the appeals courts over this important federal criminal statute.