those discovery disputes. Among those rulings was an order that defendant Glanton give deposition testimony on that issue and orders cutting off a wild goose chase to depose newspaper reporters and Rome's lawyer in this case on that issue. See Court's Order of Feb. 12, 1997 (order quashing subpoena of Shannon Duffy); Court's Order of Feb 12, 1997 (order quashing subpoenas of Joseph Daughen and Leonard W. Boasberg); Court's Order of February 10, 1997 (order granting plaintiffs' Motion for a Protective Order); Court's Order of February 5, 1997 (order granting in part and denying in part plaintiffs' Motion for Sanctions and to Compel the Continued Deposition of Richard Glanton). Such management of the case was necessary to keep the litigation within the bounds of reason; the court has given the defendants an adequate opportunity for discovery on this claim, and the claim has proven to be without merit. Summary judgment is entered on this count.
Plaintiffs also seek summary judgment on defendants' RICO claims. In Count VI, the defendants allege that plaintiff Guizzetti engaged in various acts of wire and mail fraud to induce defendant Glanton to go to Rome while misrepresenting the nature of the proposed negotiations with the Mayor of Rome. Counterclaim Count VI, PP 49-53. Defendants also allege that Guizzetti's misrepresentations to Glanton were part of a larger scheme of fraudulent transactions with other companies and art exhibitions. Counterclaim Count VI, PP 43-47.
The RICO statute creates a private cause of action for any person injured in his business or property by a violation of 18 U.S.C. § 1962. See 18 U.S.C. § 1964(c). Section 1962(c) prohibits a person employed by or associated with any enterprise engaged in or the activities of which affect interstate or foreign commerce, to conduct or participate in conduct of the enterprise's affairs through a pattern of racketeering activity. 18 U.S.C. § 1962(c). To maintain a claim for a violation of § 1962(c), a litigant must set forth: 1) the existence of an enterprise that affects interstate commerce and is separate and distinct from the defendant; 2) that the defendant was associated with the enterprise; 3) that the defendant conducted or participated in the affairs of the enterprise; 4) that each defendant engaged in a pattern of racketeering activity; and 5) the racketeering was the proximate cause of injury to the plaintiff. Shearin v. E.F. Hutton Group, Inc., 885 F.2d 1162, 1165 (1985). A § 1964(c) action based on § 1962(c) requires a claim against defendant "persons" acting through a distinct "enterprise," but allegations of conduct by officers or employees who operate or manage a corporate enterprise will satisfy this requirement. See Jaguar Cars, Inc. v. Royal Oaks Motor Car Co., 46 F.3d 258, 268 (3d Cir. 1995). Section 1962(d) prohibits any person from conspiring to violate §§ 1962(a)-(c). 18 U.S.C. § 1962(d). A claim under § 1962(d) requires a litigant to plead and prove 1) an agreement to commit the predicate acts; 2) knowledge of those acts as part of a pattern of racketeering in violation of (a), (b), or (c); and 3) an injury proximately caused by the conspiracy. Shearin, 885 F.2d at 1166.
To survive summary judgment on a § 1964(c) claim predicated on § 1962(c), a litigant must establish a pattern of racketeering activity, and this "pattern" must include at least two instances of statutorily specified activities within a ten year period, although two acts in and of themselves may not constitute a "pattern" for the purpose of RICO liability. 18 U.S.C. § 1961(5); H.J. Inc., v. Northwestern Bell Telephone Co., 492 U.S. 229, 237, 106 L. Ed. 2d 195, 109 S. Ct. 2893 (1989). A RICO litigant need not establish the existence of multiple criminal schemes. Id. at 240. Predicate acts that further a single scheme may suffice, provided that the scheme meets the other requirements of a pattern of racketeering activity: 1) the predicate acts are related; and 2) the predicate acts amount to or pose a threat of continued criminal activity. Id. at 239-40.
Predicate acts are "related" if they "have the same or similar purposes, results, participants, victims, or methods of commission, or otherwise are interrelated by distinguishing characteristics and are not isolated events." Id. at 240. For the purpose of a RICO claim, continuity may be considered either a closed or open-ended concept, "referring either to a closed period of repeated conduct, or by past conduct that by its nature projects into the future with a threat of repetition." Id. at 241 (citing Barticheck v. Fidelity Union Bank/First National State, 832 F.2d 36, 39 (3d Cir. 1987)). A litigant may demonstrate closed-ended continuity by proving a series of predicate acts over a "substantial" period of time. 492 U.S. at 242. Whether a period of time is "substantial" will turn on the facts of an individual case, but conduct that does not last for more than twelve months will not meet the standard in this circuit for closed-ended continuity. Tabas v. Tabas, 47 F.3d 1280, 1293 (3d Cir.), cert. denied, 132 L. Ed. 2d 275, 115 S. Ct. 2269 (1995). As for open-ended continuity, predicate acts that occur over a few weeks or months will not satisfy the continuity requirement unless these acts demonstrate a threat of future criminal activity. H.J. Inc., 492 U.S. at 242-43.
Mail fraud has two elements: 1) a scheme to defraud, and 2) use of the mails in furtherance of the scheme. 18 U.S.C. § 1341; United States v. Dreer, 457 F.2d 31 (3d Cir. 1972). Wire fraud requires: 1) a scheme to defraud, and 2) use of interstate communications in furtherance of the scheme. 18 U.S.C. § 1343. Defendants have indeed alleged predicate acts of wire and mail fraud, but they have not produced sufficient evidence on this record to establish a question of material fact as to the elements of mail and wire fraud.
Moreover, despite an actively pursued course of discovery, defendants have not offered up evidence of record to establish the existence of a pattern of racketeering activity or the requisite causation for either § 1962(c) or (d). Defendants have alleged a closed-ended scheme in which Guizzetti engaged in a series of false deals. The record has only produced evidence of failed deals in which Guizzetti pursued courses of action in what might be described as a less than graceful manner. In Tabas, the Third Circuit recognized that its interpretation of the RICO requirements would encompass "garden variety fraud cases," see Tabas, 47 F.3d at 1296, and this court also recognizes that RICO must be "read broadly." Id. at 1297. RICO was not meant to sweep this broadly, nor was the statute intended to remedy all sharp dealing. Summary judgment is entered on this count as well.
In Count VII, defendants assert a claim for contribution and state that any right to recovery that plaintiffs may have can be attributed to the false statements that plaintiffs and third party defendants made to one another "concerning defendants' position regarding the necessary elements of the contract." Counterclaim Count VII, P 55. Plaintiffs argue that this claim is premature and can only arise after trial and judgment against the defendants. See Stahl v. Ohio River Co., 424 F.2d 52, 55-56 (3d. Cir. 1970); 42 Pa. Cons. Stat. Ann. § 8324(a)-(b) (West 1982 & Supp. 1996).
Putting aside the difficult jurisdictional issues that this count presents, defendants have not demonstrated how the third parties they have sought to join are or may be liable to defendants for all or any part of the claims against the defendants, even if Rule 14(a) permits acceleration as a procedural matter. See, e.g., 3 James Wm. Moore et al., Moore's Federal Practice, §§ 14.05(2), 14.07 (3d ed. 1997). Thus, while Rule 14(a) authorizes the assertion of future, contingent, unmatured claims against third parties, defendants have not demonstrated any substantive basis for such a claim. See Stahl, 424 F.2d at 56. Summary judgment is entered on this count.
BY THE COURT:
MARVIN KATZ, J.