Reddy v. Litton Industries, Inc.

Background

A person sued under the federal racketeering law (RICO), claiming a conspiracy to commit wrongdoing. The Ninth Circuit held that the person could not bring a RICO conspiracy claim because the alleged wrongful acts were not the specific kinds of crimes the RICO law lists as "predicate acts." Other federal appeals courts have reached different results in similar cases.

Reasoning

The core question was whether someone can sue for a RICO conspiracy when the overt acts they point to are not the types of crimes RICO defines as predicate acts. The Ninth Circuit followed the Second Circuit’s rule that a plaintiff must show injury from overt acts that themselves are RICO-prohibited. The Third Circuit had taken the opposite view and allowed such conspiracy claims. Justice White wrote a dissent saying the Supreme Court should review this split, but the Supreme Court declined to take the case and left the appeals-court disagreement in place.

Real world impact

Because the high court refused review, the disagreement among appeals courts remains. People trying to bring RICO conspiracy lawsuits will face different rules depending on which federal appeals court covers their case. The Ninth Circuit’s rule will block some conspiracy claims that other circuits might allow. This decision is a procedural refusal to review, not a final nationwide ruling on the legal question.

Dissents or concurrances

Justice White dissented from the Court’s refusal to review. He emphasized the circuit split and said the issue was important enough for the Supreme Court to decide.