The Atlantic Legal Foundation and the DRI Center for Law and Public Policy have filed an amicus brief in Medical Marijuana, Inc. v. Horn, No. 23-365, urging the Supreme Court to address the question of whether personal injury claims can be transformed in treble-damages civil RICO suits. Sarah Spencer of Christensen & Jensen and I co-authored the brief. We received valuable pro bono assistance from Joe Hollingsworth, Bill Cople, and Elyse Shimada of Hollingsworth LLP.
Case Background
The Racketeer Influenced and Corrupt Organizations Act (“RICO”) authorizes the filing of civil suits for treble damages and attorney fees by “[a]ny person injured in his business or property by reason of” engaging in certain prohibited activities. 18 U.S.C. § 1964(c). RICO was enacted as a prosecutorial tool for fighting organized crime. The Second and Ninth Circuits have held, however, that a civil RICO treble-damages claim can be filed for lost wages or other employment-related economic injuries resulting from a personal injury—such as in a product liability case—even though it is well settled that personal injury claims themselves are excluded from civil RICO.
Plaintiffs’ lawyers have seized upon these holdings, with which at least three other circuits disagree, to attempt to transform ordinary product liability suits into civil RICO actions. Civil RICO’s broad venue and jurisdictional provisions enable plaintiffs to “forum shop” to circuits or district courts that allow such personal injury-related civil RICO claims, and thereby not only seek treble damages, but also circumvent various States’ tort reform measures.
Horn v. Medical Marijuana, Inc. is a seemingly ordinary manufacturing-defect product liability suit involving alleged ingestion of a legal, non-psychoactive, CBD wellness product. The Second Circuit held, however, that the truck driver plaintiff, who lost his job after ingesting the product and then failing a routine drug test, can maintain a civil RICO claim for lost wages and other employment-elated economic harm against the product’s producers. They have filed a certiorari petition requesting the Supreme Court to rule that civil RICO claims do not encompass economic harms resulting from personal injuries.
Amicus Brief
The ALF/DRI amicus brief argues that the Supreme Court should grant certiorari and reverse the Second Circuit to deter forum-shopping plaintiffs from circumventing state tort reform laws by transforming ordinary product liability suits into civil RICO treble-damages actions. Civil RICO’s expansive venue provision allows plaintiffs to sue practically anywhere. Unless the Supreme Court intercedes, plaintiffs will try to avoid state product liability reforms by filing in circuits that allow civil RICO claims for personal injury-related economic harms. Allowing such suits would greatly exacerbate the already skyrocketing costs of product liability litigation, and adversely affect product innovation and the public.