Federal District Court Opinions
MAGNUM v. ARCHDIOCESE OF PHILADELPHIA, (E.D.Pa. 11-17-2006)
THOMAS MAGNUM, et al. Plaintiffs, v. ARCHDIOCESE OF
PHILADELPHIA, et al., Defendants. Civil Action No.
06-CV-2589. United States District Court, E.D.
Pennsylvania. November 17, 2006
MEMORANDUM
LEGROME DAVIS, District Judge
Presently before the Court is Defendants’ Motion to
Dismiss (Doc. No. 4), Plaintiffs’ Response in Opposition
(Doc. No. 7) and Defendants’ Reply thereto (Doc. No. 12).
Upon careful consideration of all the pleadings submitted
by Plaintiffs, and after hearing oral argument on the
matter on September 18, 2006, for the reasons set forth
below, Defendants’ Motion is GRANTED.
I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY
On June 15, 2006, twelve individuals, Thomas Magnum,
Willie Magnum, James Money, David Porter, Walt Daly, Mary
Logan, Alfred Roberts, Nicholas Siravo, Bill Henis, Joan
McCrane, John Quinn and James Spoerl (collectively
“Plaintiffs”), instituted the instant class-action civil
RICO action against the Archdiocese of Philadelphia and
Justin Rigali, Anthony Bevilacqua and the Estate of John
Krol, three individual Cardinals (collectively
“Defendants”). The substance of Plaintiffs’ claims are that
Defendants collectively engaged in a large-scale cover-up of
a pattern of child abuse perpetrated by individual priests
of the Philadelphia Archdiocese against numerous minor
children. Plaintiffs are adults, but were minor children
at Page 2 the time they were allegedly abused. The
earliest instance of abuse to a named plaintiff occurred in
1955, the latest of which in 1985. Plaintiffs base much of
their allegations on a grand jury investigation of the
Philadelphia Archdiocese conducted by the Office of the
District Attorney of Philadelphia, an investigation which
culminated in a 400-plus page report (“Grand Jury Report”)
detailing the Grand Jury’s factual findings with regard to
the allegations of sexual abuse and cover-up. The alleged
acts of sexual abuse ranged from inappropriate fondling to
harrowing instances of forcible oral, anal or vaginal rape
of minor children committed by priests. Plaintiffs claim
there are up to 500 members of the plaintiff class and
approximately sixty-three priests who are known to have
engaged in the sexual molestation of children. Plaintiffs
allege that the sexual abuse of minor children in the
Philadelphia Archdiocese began in 1940, but that the
cover-up has continued until at least 2002. In particular,
Plaintiffs claim that high level Archdiocese officials,
including the named Cardinal defendants, when confronted
with complaints and evidence of abuse, simply ignored the
allegations and allowed or even in some instances
encouraged the suspected priests to continue working in the
parishes, knowingly and recklessly exposing them to more
vulnerable children. In other cases, Plaintiffs allege that
Defendants coerced and improperly influenced complainants
to keep quiet, transferred priests with known and
unresolved allegations of abuse to different parishes so as
to “hide” them, reprimanded or sanctioned internal
complainants, or feigned internal investigations in order
to prevent complainants from going to the authorities.
Based on these allegations, Plaintiffs assert four causes
of action: (1) a 18 U.S.C. § 1964(c) (civil RICO)
claim based on a violation of 18 U.S.C. § 1962(c);
(2) a civil RICO claim predicated on a violation of
§ 1962(d) (RICO conspiracy); (3) a claim of
conspiracy to deprive of Page 3 civil rights (42 U.S.C.
§ 1985(2) and (3)); and (4) a claim of knowing
neglect to prevent 42 U.S.C. § 1985 violations (42
U.S.C. § 1986).
On July 17, 2006, Defendants moved to dismiss Plaintiffs’
Complaint in its entirety for failing to state a claim and
to stay class consideration until the resolution of the
Motion to Dismiss. The Court granted the stay on July 28,
2006. Subsequently, Plaintiffs responded in opposition to
the Motion to Dismiss and Defendants replied. The Court
heard oral arguments on September 18, 2006.
II. LEGAL STANDARD
A motion to dismiss pursuant to Rule 12(b)(6) of the
Federal Rules of Civil Procedure tests the legal
sufficiency of the complaint. See Markowitz v. Ne. Land
Co., 906 F.2d 100, 103 (3d Cir. 1990); Sturm v. Clark, 835
F.2d 1009, 1011 (3d Cir. 1987). Dismissal for failure to
state a claim is appropriate when it clearly appears that
the plaintiff can prove no set of facts in support of the
claim which would entitle him to relief. See Conley v.
Gibson, 355 U.S. 41, 45-46 (1957); Robb v. City of Phila.,
733 F.2d 286. 290 (3d Cir. 1984). In deciding a motion to
dismiss pursuant to Rule 12(b)(6), all facts alleged in the
complaint must be accepted as true. Malia v. Gen. Elec.
Co., 23 F.3d 828, 830 (3d Cir. 1994). A court may also
consider any document appended to and referenced in the
complaint on which plaintiff’s claim is predicated.[fn1]
See Fed.R.Civ.P. 10(c); In re Burlington Coat Factory Sec.
Litig., 114 F.3d 1426 (3d Cir. 1997); In re Westinghouse
Sec. Litig., 90 F.3d 696, 707 (3d Cir. 1996). A court,
however, need not credit conclusory allegations or legal
conclusions in deciding a motion to dismiss. See Gen.
Motors Page 4 Corp. v. New A.C. Chevrolet, Inc., 263 F.3d
296, 333 (3d Cir. 2001); Morse v. Lower Merion School
Dist., 132 F.3d 902, 906 (3d Cir. 1997). A claim may be
dismissed when the facts alleged and the reasonable
inferences therefrom are legally insufficient to support
the relief sought. See Pennsylvania ex rel. Zimmerman v.
PepsiCo., Inc., 836 F.2d 173, 179 (3d Cir. 1988).
III. DISCUSSION
A. Civil RICO Based on Violation of 18 U.S.C. §
1962(c) (18 U.S.C. § 1964(c))
The civil RICO statute creates a cause of action for
“[a]ny person injured in his business or property by reason
of a violation of section 1962 of this chapter.” 18 U.S.C.
§ 1964(c). Section 1962, in relevant part, provides:
(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 of such enterprise’s affairs
through a pattern of racketeering activity . . . (d) It
shall be unlawful for any person to conspire to violate
any of the provisions of subsection (a), (b), or (c) of
this section.
“Racketeering activity” is defined in 18 U.S.C. §
1961(1) to include, inter alia, a number of crimes such as
kidnapping, extortion and bribery punishable under state
law by a term of imprisonment in excess of one year, as
well as numerous federal crimes such as obstruction of
justice and mail and wire fraud.
In order to pursue a civil RICO claim, plaintiff must
first allege (1) that he suffered an injury to his
“business or property” (2) proximately caused by
defendant’s RICO violation. 18 U.S.C. § 1964(c);
Holmes v. Sec. Investor Prot. Corp., 503 U.S. 258, 268
(1992) (RICO violation must not only be “but for” cause but
also proximate cause of plaintiff’s injury). In general,
these Page 5 civil RICO “standing” requirements are viewed
as questions regarding the adequacy of the pleadings,
rather than as questions of subject matter jurisdiction.
Anderson v. Ayling, 396 F.3d 265, 269 (3d Cir. 2005)
(citing Maio v. Aetna, Inc., 221 F.3d 472, 482 n. 7 (3d
Cir. 2000)).
1. Injury to “Business or Property”
Plaintiffs allege three types of RICO injuries as a result
of Defendants’ cover-up: (1) severe emotional distress as a
result of sexual abuse, resulting in loss of earnings and
decreased earnings capacities; (2) out of pocket medical
and psychological treatment expenses; and (3) loss of the
ability to pursue personal injury claims as a result of the
running of the statute of limitations.[fn2] Compl. §
116-17.
a. Personal Injuries
The Third Circuit has interpreted the term injury to
“business or property” in § 1964(c) to exclude
personal injuries and the economic losses derived
therefrom. Genty v. Resolution Trust Corp., 937 F.2d 899,
918 (3d Cir. 1991) (emotional distress and medical expenses
arising from Page 6 alleged exposure to toxic waste do not
confer RICO standing); Zimmerman v. HBO Affiliate Group,
834 F.2d 1163, 1169 (3d Cir. 1987) (affirming dismissal for
failure to state RICO claim where only mental distress was
alleged). Additionally, to survive a motion to dismiss,
Plaintiffs must plead an actual and concrete monetary loss
and not merely a loss to “valuable intangible property
interests.” Maio, 221 F.3d at 483. Therefore, at the
outset, it is clear that Plaintiffs’ claims of emotional
distress, loss of earnings,[fn3] and decreased earnings
capacities are insufficient to support a civil RICO action.
In the leading Third Circuit case on this issue, a group
of individuals purchased homes only to later discover that
their homes were located near a municipal landfill owned by
the local township. Genty, 937 F.2d at 904. The homeowners
brought a civil RICO claim against the developer, mortgage
lender, township and township officials, alleging
defendants failed to warn them of the known dangers
associated with living near the allegedly toxic landfill,
and fraudulently assured some plaintiffs that the landfill
posed no serious harm. Id. In addition to alleging economic
injury resulting from decreased property values, plaintiffs
claimed personal injuries, including emotional distress and
out-of-pocket medical expenses resulting from Page 7
exposure to the allegedly toxic landfill. Id. at 918.
However, the Third Circuit concluded that because “[i]n
ordinary usage, `injury to business or property’ does not
denote physical or emotional harm to a person,” the
homeowners’ alleged physical and emotional injuries were
insufficient to support civil RICO standing. Id. (emphasis
in original).
The vast majority of circuits concur.[fn4] Indeed, the
Supreme Court has remarked with regard to the identical
language in section 4 of the Clayton Act that the phrase
“business or property” excludes personal injuries suffered.
Reiter v. Sonotone Corp., 442 U.S. 330, 339 (1979)
(citation omitted) (dictum). In light of the fact that the
Supreme Court has repeatedly observed that Congress modeled
§ 1964(c) after section 4 of the Clayton Act,[fn5]
see, e.g., Agency Page 8 Holding Corp. v. Malley-Duff &
Assoc., Inc., 483 U.S. 143, 150-51 (1987), many circuits
have relied on the aforementioned dictum in Reiter to
bolster their conclusions that personal injuries are not
injuries to “business or property” under § 1964(c).
See, e.g., Genty, 937 F.2d at 918 (citing Reiter); Grogan,
835 F.2d at 847 (same).
Given the overwhelming weight of legal authority on this
issue, the Court is compelled to conclude that Plaintiffs’
alleged emotional distress, loss of earnings and decreased
earnings capacity are personal injuries insufficient to
confer RICO standing.
b. Out-of-pocket expenses
Plaintiffs’ alleged out-of-pocket medical and
psychological treatment expenses also are insufficient to
support a RICO claim. While such expenses do represent
concrete financial losses, they nevertheless clearly derive
from the Plaintiffs’ personal injury claim of emotional
distress. Compl. § 117 (Plaintiffs’ medical and
psychological treatment was “necessitated by the acts of
abuse”). Indeed, the identical allegation was squarely
considered and rejected by the Third Circuit. See Genty,
937 F.2d at 918 (medical expenses incurred as a result of
exposure to allegedly toxic waste are not RICO
injuries).[fn6] Furthermore, even if the Court was to put
aside Page 9 controlling precedent in Genty, as a matter
of logic, it makes little sense to recognize such a
pecuniary consequence as a RICO injury when the direct
personal injury itself is legally insufficient. Therefore,
despite the pecuniary nature of these alleged out-of-pocket
expenses, the Court finds that they are nevertheless
properly understood as part of Plaintiffs’ personal injury
claims and thus cannot support RICO standing. Genty, 937
F.2d at 918; see also Evans v. City of Chicago, 434 F.3d
916, 926-27 (7th Cir. 2006) (loss of income caused by
alleged false imprisonment is pecuniary loss “derivative of
personal injuries arising under tort law” and not RICO
injury); Grogan, 835 F.2d at 846 (no recovery under RICO
for “those pecuniary losses that are most properly
understood as part of a personal injury claim”).
c. Lost tort claims
The Plaintiffs’ last remaining claim of injury is that as
a result of the Defendants’ conspiracy and concealment of
the crimes committed by priests under their supervision,
Plaintiffs lost valuable legal claims that would have
resulted in monetary recovery had the claims been asserted
in a timely manner. While this is a somewhat novel pleading
of injury, the Court nevertheless concludes based on a
review of relevant legal authority that Plaintiffs’ lost
tort claims are not injuries to “business or property”
under § 1964(c).
First, there is little legal support for the argument that
the loss of an opportunity to recover for a tort is a
cognizable RICO injury. In fact, a similar theory of injury
was rejected by a court in 0this district. In Mehling v.
New York Life Insurance Co., individual employees brought a
RICO Page 10 claim against their employer, alleging that
the employer engaged in a series of fraudulent investments
with regard to managing the employee retirement plan. 163
F. Supp. 2d 502 (E.D. Pa. 2001). The employee-plaintiffs
there alleged a similar injury: because of the employer’s
fraudulent conduct, the plaintiffs were denied the
opportunity to protect their interests by seeking the help
of authorities or discontinuing contributions into the
allegedly fraudulent retirement plan. Id. at 507. The Court
nevertheless dismissed the complaint, finding that
notwithstanding such claims, the plaintiffs failed to
allege any concrete financial injury resulting from the
alleged RICO violations. Id.; see also Doe v. Roe, 958 F.2d
763, 767-70 (7th Cir. 1992) (failure to allege RICO injury
where plaintiff claimed, inter alia, that defendant engaged
in “campaign of intimidation” to “prevent her from seeking
legal recourse which would have revealed his fraudulent
activities”).
Courts have held, however, in the context of business
litigation that a defendant’s fraudulent or obstructive
conduct which causes a plaintiff to relinquish a cause of
action or otherwise delays an in-progress prosecution may
constitute a “business or property” injury for RICO claims.
Deck v. Engineered Laminates, 349 F.3d 1253, 1258-60 (10th
Cir. 2003); Malley-Duff & Assoc., Inc. v. Crown Life Ins.
Co., 792 F.2d 341, 354-55 (3d Cir. 1986). In Deck, the
plaintiff, a former employee of the defendants, alleged
that defendants fraudulently induced him to enter into a
settlement agreement to release defendants from a pending
lawsuit. 349 F.3d at 1258. The agreement further required
that the plaintiff cease his business insofar as it
competed with the defendants’ in exchange for a series of
payments. Id. The plaintiff additionally alleged that when
defendants breached the settlement agreement by failing to
pay, they misrepresented to him that the corporation no
longer existed in order to prevent him from suing to
enforce the agreement at a time when defendants still had
assets. Id. at 1259. In this context, the Court held Page
11 that the foregone causes of action, both related to
plaintiff’s business and rooted in contract, were injuries
to “business or property” sufficient to establish RICO
standing. Id. Similarly, the Court in Malley-Duff found
that where the underlying cause of action arose out of the
“termination of a business,” plaintiff’s allegations of
“great expenses, delays and inconvenience” in his
prosecution of the underlying lawsuit against defendant as
a result of defendant’s obstruction of justice was a RICO
injury. Malley-Duff, 792 F.2d at 354-55.
However, Malley-Duff and Deck are distinguishable from the
case at hand since they both involved causes of action
affecting business interests grounded in contract, not
tort. The causes of action in Deck and Malley-Duff related
to in-progress business contract disputes while the
Plaintiffs’ claims here involve tort suits which were never
initiated. Plaintiffs here, unlike the plaintiffs in
Malley-Duff and Deck, allege that Defendants’ conduct
resulted in Plaintiffs’ “inability to pursue claims for
monetary damages against the Defendants for personal
injuries sustained.” Compl. § 116. Therefore, because
the holdings in Deck and Malley-Duff arose from factual
circumstances that are sufficiently distinct from those
surrounding Plaintiffs’ claims, this Court concludes that
they do not control the outcome in this case.
Furthermore, to the extent that Plaintiffs seek to
classify their unliquidated tort claims as “property” and
the loss of the opportunity to assert those claims a
deprivation thereof, that view is in direct conflict with
Pennsylvania state law. While RICO is a federal cause of
action, numerous circuits have held that the determination
of whether a particular interest is properly considered
“property” for injury to “business or property” purposes is
governed by state law. Diaz, 420 F.3d at 900 (looking to
state law to determine the definition of “property” for
deciding whether a certain injury is one suffered to
“business or property”); Doe, 958 F.2d at 768 (citing Logan
v. Page 12 Zimmerman Brush Co., 455 U.S. 422, 430 (1982)
(“The hallmark of property . . . is an individual
entitlement grounded in state law . . .”); Leach v. FDIC,
860 F.2d 1266, 1274 n. 14 (5th Cir. 1988) (“[a]ny
definition of the term `property,’ an inherently state
law-related term, should look to state law”). In this case,
under Pennsylvania law, an unliquidated personal injury
tort claim is decidedly not a property right.[fn7] See,
e.g., Sensenig v. Pa. R.R. Co., 78 A. 91, 92 (Pa. 1910)
(right to sue for tort “does not seem to us to be a
property right, capable of assignment, prior to
liquidation”); Chiropractic Nutritional Assoc., Inc. v.
Empire Blue Cross & Blue Shield, 669 A.2d 975, 983
(Pa.Super. 1995) (“under Pennsylvania state law, an
unliquidated personal injury tort claim is not a property
right and is not assignable”); cf. Galey v. Mellon, 33 A.
560 (Pa. 1896) (contracts and all rights to sue thereunder
are assignable).
Moreover, even assuming, arguendo, that there is merit to
the claim that Plaintiffs’ loss of their unliquidated tort
claims are injuries to property, determining the value of
that injury for compensatory purposes would be a wholly
speculative exercise. See First Nationwide Bank v. Gelt
Funding Corp., 27 F.3d 763, 768 (2d Cir. 1994) (a cause of
action does not accrue under Page 13 RICO until amount of
damages becomes “clear and definite”). Not surprisingly, a
number of courts in similar situations have dismissed RICO
claims on ripeness grounds where the value of the alleged
“property” deprivation was contingent upon uncertain
events, such as on plaintiff prevailing in a related
lawsuit against the defendant. See DeMauro v. DeMauro, 115
F.3d 94, 97 (1st Cir. 1997) (wife failed to adequately
allege injury to property where claim was based on mere
expectancy of receiving an award in pending divorce
proceeding); Lincoln House, Inc. v. Dupre, 903 F.2d 845,
847 (1st Cir. 1990); Capasso v. CIGNA Ins. Co., 765 F.Supp.
839, 842 (S.D.N.Y. 1991) (“mere expectation of a favorable
decree awarding [wife] a share of her husband’s assets in
the state court matrimonial action” is not a property
interest under RICO).
In Lincoln House, plaintiffs alleged defendant made
fraudulent asset transfers in order to avoid satisfying a
potential judgment in a state contract suit pending between
the same parties. 903 F.2d at 847. However, the Eleventh
Circuit dismissed the RICO action, pointing out that “the
only injury alleged by Lincoln is its hypothetical
inability to recover from Paul Dupre, if Lincoln obtains a
judgment, in some amount, in the pending state court breach
of contract action.” Id. (emphasis in original). If Lincoln
were to lose in its litigation in state court, the Court
reasoned, plaintiff would have no claim of injury of any
sort with which to support a RICO claim. Id. at 848.
Similarly, the Court in Deck noted that had plaintiff’s
only alleged injury been “prejudice to his ability to
collect damages for breach of contract” because defendants
allegedly fraudulently obstructed plaintiff’s suit until
such a time when defendants no longer had assets with which
to satisfy a potential judgment, his RICO claim would have
been dismissed as unripe until the contract action had been
resolved. Deck, 349 F.3d at 1260.
This Court is persuaded that this line of reasoning leads
to the conclusion that Plaintiffs Page 14 here have
failed to state a viable RICO cause of action. Plaintiffs’
claim of injury is entirely contingent on the assumption
that they would have prevailed in their individual tort
claims in state court had they asserted them in a timely
manner; had Plaintiffs’ claims been asserted and denied on
the merits, those claims would have had no monetary value
and thus cannot be “property” even under Plaintiffs’
theory.[fn8] Indeed, Plaintiffs’ counsel conceded at oral
argument that the tort claims at issue have been
“extinguished” by Pennsylvania state courts on statute of
limitations grounds. Tr. of Or. Arg. at 13; see also Meehan
v. Archdiocese of Phila., 870 A.2d 912 (Pa.Super. 2005)
(state tort actions based on similar allegations of child
abuse and fraudulent concealment barred by statute of
limitations). As such, even if the Court agreed with
Plaintiffs’ characterization of their lost claims as
“property,” their RICO claims predicated on such an alleged
injury would be unripe, and indeed would never become ripe,
for judicial resolution. Motorola Credit Corp. v. Uzan, 322
F.3d 130, 135 (2d Cir. 2003) (no statutory standing under
RICO where underlying claims are unripe and damages were
uncertain); Bankers Trust Co. v. Rhoades, 859 F.2d 1096,
1106 (2d Cir. 1988) (dismissing civil RICO claims because
alleged damages were “speculative” and “unprovable”).
Therefore, consistent with the holdings of the numerous
courts that have Page 15 already weighed in on the issue,
this Court conclude that Plaintiffs’ complaint must be
dismissed because it fails to adequately allege an injury
to “business or property” as required under §
1964(c).
2. Proximate cause
Even assuming, arguendo, that Plaintiffs properly pled an
injury to “business or property,” the Complaint
nevertheless fails to establish that Plaintiffs’ injury was
suffered “by reason of” a RICO violation. 18 U.S.C.
§ 1964(c). To survive a motion to dismiss, in
addition to alleging an injury to “business or property,”
plaintiff must also plead that his injuries were
proximately caused by defendant’s alleged RICO pattern or
acts. Anza v. Ideal Steel Supply Corp., 126 S.Ct. 1991,
1994 (2006); Holmes v. Sec. Investor Prot. Corp., 503 U.S.
258, 268 (1992). In determining whether proximate cause
exists, a court must ask whether the alleged injury was a
direct result of the complained of conduct. Anza, 126 S.Ct.
at 1998. The Third Circuit has developed three factors to
consider in the RICO proximate cause analysis: (1) the
directness of the injury; (2) the difficulty of
apportioning damages among potential plaintiffs and; (3)
the possibility of other plaintiffs vindicating the goals
of RICO by suing directly. Allegheny Gen. Hosp., 228 F.3d
at 443 (citing Steamfitters Local Union No. 420 Welfare
Fund v. Phillip Morris, Inc.. 171 F.3d 912, 932 (3d Cir.
1999)). Unlike the majority of cases where the proximate
cause issue arises because the RICO action is brought by a
third-party based on a subrogation theory, such is not the
case here. Thus the third factor does not apply. As such,
the Court’s discussion is limited to the first and second
proximate cause factors, both of which strongly counsel
against a finding of proximate cause.
a. Directness of injury Page 16
At the outset, this Court notes Plaintiffs’ emotional
distress and treatment cost injuries were alleged to have
resulted from the actual acts of sexual abuse, and not from
the subsequent fraudulent concealment. See Compl. §
117 (“Plaintiffs suffered severe emotional and
psychological stress and illness as a result of the sexual
abuse . . . Plaintiffs also have suffered and will continue
to suffer out-of-pocket expenses relating to medical and
psychological treatment, therapy and counseling
necessitated by the acts of abuse”) (emphasis added). None
of the Defendants, however, are alleged to have perpetrated
any acts of sexual abuse.[fn9] Therefore, the causation
analysis with regard to these injuries must end with the
conclusion that even factual causation is lacking.
With regard to loss of claims, Plaintiffs claim that their
injury resulted from Defendants’ extensive cover-up of the
widespread sexual abuse. Plaintiffs claim that they were
unaware of the wrongfulness of the priests conduct at the
time the abuse was inflicted upon them, and that they did
not know of the facts giving rise to Plaintiffs’ causes of
action until the Grand Jury Report was released in
September 2005. Compl. §§ 64, 66. Because of
Defendants’ fraudulent conduct in concealing the abuse,
Plaintiffs allege they were prevented from discovering
their injuries in time to seek legal redress. Id.
§§ 33, 116.
To establish a loss of claims, it must first be
demonstrated that the claims would have been Page 17
brought in the absence of Defendants’ alleged wrongdoing.
However, one may imagine many reasons why a victim of abuse
may not seek legal redress for his injuries in the absence
of any cover-up or even if he knew about the cover-up. Any
number of independent forces and decisions may have
intervened between the alleged concealment and the failure
of Plaintiffs to bring tort claims against their
abusers.[fn10] The chain of causation here is simply too
attenuated to support RICO standing. See Anza, 126 S.Ct. at
1997 (where plaintiff’s lost sales could have resulted from
a number of factors other than defendants’ alleged fraud,
injury is too indirect to constitute proximate cause in
civil RICO case).
b. Difficulty of apportioning damages
Moreover, as extensively discussed above, ascertaining the
extent of actual damages in this case based on the loss of
claims injury would be extremely difficult given the
speculative nature of the injury at issue. Therefore, this
factor also weighs heavily against a finding of proximate
cause.
3. Enterprise
Even if Plaintiffs are able to establish RICO standing,
the Court nevertheless has concerns about the pleadings
with regard to the “enterprise” element of RICO. RICO makes
it unlawful for “any person” who is employed by or
associated with “any enterprise” affecting interstate Page
18 commerce to “participate, directly or indirectly, in the
conduct of such enterprise’s affairs through a pattern of
racketeering activity.” 18 U.S.C. § 1962(c).
Plaintiffs allege a total of eleven distinct RICO
“enterprises,” consisting of various permutations involving
Cardinal Rigali, Cardinal Bevilacqua, the late Cardinal
Krol, the Archdiocese of Philadelphia, the “pedophile
priests” and the United States Bishops of the Roman
Catholic Church. See Compl. §§ 85-95. Under
§ 1961(4), “enterprise” is “any individual,
partnership, corporation, association, or other legal
entity, and any union or group of individuals associated in
fact although not a legal entity.” 18 U.S.C. §
1961(4). While “person” is defined broadly to include both
natural persons and entities, see 18 U.S.C. §
1961(3), sections 1962(c) and (d) require that the “person”
and “enterprise” be distinct from one another. B.F. Hirsch
v. Enright Ref. Co., Inc., 751 F.2d 628, 634 (3d Cir.
1984). Where the alleged “person” is also the RICO
“enterprise” through which the racketeering activity
occurred, liability can only arise under § 1962(a)
or (b). Petro-Tech, Inc. v. W. Co. of N. Am., 824 F.2d
1349, 1360-61 (3d Cir. 1987). Therefore, paragraph 93 of
the Complaint, in which the Archdiocese of Philadelphia
itself is alleged to be an “enterprise,” fails as a matter
of law.
4. Pattern of Racketeering Activity
Plaintiffs’ allegations of “pattern” and “racketeering
activity” are also problematic. Establishing a RICO
“pattern” requires pleading two related predicate acts of
racketeering and some threat of continuing activity. H.J.
Inc. v. Northwestern Bell Tel. Co., 492 U.S. 229, 239
(1989). In addition, plaintiff must also allege that each
individual defendant engaged in two or more predicate
offenses. Banks v. Wolk, 918 F.2d 418, 421 (3d Cir. 1990);
Hall v. Tressic, 381 F. Supp. 2d 101, 107 (N.D.N.Y. 2005).
At the outset, the Court notes that the pleadings do not
Page 19 support the maintenance of this current action
against Cardinal Rigali at all. Nothing in the Complaint or
the Grand Jury Report alleges any wrongdoing on the part of
Cardinal Rigali. In fact, in Plaintiffs’ own words, their
current claim is “based on allegations that Defendants
continued to violate RICO until at least the year 2002.”
Pl.’s Resp. Brief at 10. However, Cardinal Rigali was not
installed as the Archbishop of Philadelphia until October
7, 2003.[fn11]
Throughout the Complaint, Plaintiffs consistently refer to
Defendants in the collective, and generally allege that
Defendants collectively engaged in a series of racketeering
acts. As defined in § 1961(1), “racketeering
activity” includes, inter alia, a number of crimes
punishable under state law by a term of imprisonment in
excess of one year, as well as a litany of federal crimes
such as obstruction of justice and mail and wire fraud. 18
U.S.C. § 1961(1). In particular, Plaintiffs allege
that Defendants engaged in “acts and/or threats involving
kidnapping, bribery, extortion, and dealing in obscene
matter” all of which are felonies under state law. Compl.
§ 114. In addition, the Complaint claims that
Defendants committed the federal offenses of “mail and/or
wire fraud, obstruction of criminal investigations,
obstruction of state or local law enforcement, tampering
with a witness or victim, retaliating against a witness or
victim, peonage, slavery and Page 20 trafficking in
persons and sexual exploitation of children.”[fn12] Id.
Notwithstanding this long list of alleged criminal
conduct, however, the Complaint fails to provide sufficient
facts to support the allegations. The only individual
Defendant specifically mentioned by name in the Complaint
is Cardinal Belivacqua. Even then, the Complaint only
alleges that Cardinal Belivacqua made misrepresentations to
the Grand Jury in 2002 regarding the extent of the
cover-up, and that in 1988, Plaintiff Mr. Porter allegedly
notified Cardinal Belivacqua of his abuse.[fn13] Id. at
§ 115, 41. Looking to the Grand Jury Report, only
Cardinal Belivacqua and Cardinal Krol are mentioned by
name, and where they are so referenced, they are generally
alleged to have transferred and/or accepted certain priests
suspected of abuse and in some instances persuaded parents
not to go to the authorities with abuse complaints. The
allegations are conclusory and generalized, and often do
not even contain the dates the acts were alleged to have
occurred.
With regard to the alleged state crimes, the Complaint is
devoid of any facts in support of the essential elements of
the kidnapping, bribery, extortion and dealing in obscene
matter charges. Indeed, to the extent that Plaintiffs seek
to establish criminal liability based on state law on the
part of the named Defendants, their own Grand Jury Report
undercuts their attempt. The Report contains a detailed
analysis of the likelihood of success in prosecuting the
leaders of the Page 21 Archdiocese for their roles in the
sex abuse and the cover-up. See Grand Jury Report, p.
64-68. The Grand Jury considered various state criminal
statutes, including accomplice liability for sexual abuse,
reckless endangerment and obstructions of justice, but
ultimately concluded the conduct of the high level
Archdiocese officials did not rise to a level such that
they could be prosecuted under existing Pennsylvania
criminal law. Id. at 64.
Furthermore, as to the federal offenses, many of those
alleged by Plaintiffs to have been committed by Defendants
are wholly irrelevant to the facts of this case. For
instance, the “obstruction of state or local law
enforcement” offense pled by Plaintiffs only criminalizes
certain conduct done “with the intent to facilitate an
illegal gambling business.” 18 U.S.C. § 1511(a).
Likewise, the offenses of “peonage, slavery and trafficking
in persons” require the actual interstate or international
transportation of persons, see 18 U.S.C. §§
1581-90, or intent to coerce or force the minor to engage in
a “commercial sex act,” 18 U.S.C. § 1591, or involve
the withholding of an individual’s identification or
immigration documents, 18 U.S.C. § 1592.
Furthermore, the “sexual exploitation of children” offense
criminalizes conduct relating to the creation of child
pornography. 18 U.S.C. §§ 2251, 2251A, 2252,
2260. The “obstruction of criminal investigations” charge
also fails because it only relates to obstructive conduct
relating to a federal criminal investigations made to a
“criminal investigator.” 18 U.S.C. § 1510.
Additionally, even if the tampering and retaliation
statutes are applicable to this case, Plaintiffs have
nevertheless failed to allege any specific acts so as to
establish the essential elements of those offenses. See 18
U.S.C. §§ 1512, 1513.
Plaintiffs also allege that Defendants engaged in wire and
mail fraud, based on Defendants’ acts of transferring
priests to various parishes and of soliciting contributions
from Page 22 parishioners, both of which were accomplished
through interstate letters and telephone calls. Compl.
§§ 103, 113. The federal mail and wire fraud
statutes criminalizes the use of the mails or interstate
wires for purposes of carrying out any “scheme or artifice
to defraud.” 18 U.S.C. §§ 1341, 1343. However,
to the extent that Plaintiffs seek to base their RICO claim
on predicate acts of mail and wire fraud, they must comply
with Federal Rule of Civil Procedure 9(b), which requires
that fraud allegations be pled with specificity. Lum v.
Bank of Am., 361 F.3d 217, 224 (3d Cir. 2004); Fed.R.Civ.P.
9(b) (“[i]n all averments of fraud or mistake, the
circumstances constituting fraud or mistake shall be stated
with particularity”). Plaintiffs must plead with
particularity the circumstances of the alleged fraud so as
to provide defendants with notice of the precise misconduct
with which they are charged. Seville Indus. Mach. Corp. v.
Southmost Mach. Corp., 742 F.2d 786, 791 (3d Cir. 1984).
Plaintiffs can satisfy this heightened pleading requirement
by pleading the “date, place or time of the fraud,” or must
otherwise somehow inject some level of “precision” or
“substantiation” into their allegations. Lum, 361 F.3d at
224. Plaintiffs must, at the very least, allege “who made a
misrepresentation to whom and the general content of the
misrepresentation.” Id.
Plaintiffs’ Complaint fails to plead the mail and wire
fraud allegations with any level of particularity. With
regard to transferring the priests, neither the Complaint
nor the Grand Jury Report provides sufficient details of
the acts alleged to have been wrongful so as to satisfy
Rule 9(b). Plaintiffs do not give the dates and times of
the transfers, where the priests were transferred to and
from, exactly how the transfers were facilitated (whether
through letters or phone calls), or what
misrepresentations, if any, were made in carrying out the
transfers. Similarly, the allegations regarding the
contribution solicitations are even more vague and
conclusory, stating only that Page 23 Defendants
“fraudulently misrepresented facts of known sexual
misconduct to parishioners . . . for the economic purpose
of avoiding civil liability while increasing or maintaining
the charitable contributions . . . Upon information and
belief, much, if not all, of the solicitations for
contributions were effectuated by using the United States
Postal Service or interstate wire service.” Compl. §
113. Such allegations plainly fail to comply with Rule
9(b)’s pleading requirements. See Lum, 361 F.3d at 227
(district court properly dismissed complaint for failing to
plead mail and wire fraud with requisite specificity).
In conclusion, not only do Plaintiffs fail to sufficiently
allege that each Defendant engaged in two or more predicate
acts as is necessary to establish a RICO “pattern” under
§ 1961(5), the Court is not convinced that
Plaintiffs have even sufficiently pled the existence of any
“racketeering activity.” Therefore, even if Plaintiffs had
established standing for RICO purposes, the Complaint must
still be dismissed for failing to adequately plead a RICO
“pattern of racketeering activity.”
5. Statute of Limitations
Plaintiffs claim that Defendants’ fraudulent concealment
continued until at least 2002, and as a result of the
cover-up, Plaintiffs only discovered their injuries when
the Grand Jury report documenting the widespread cover-up
and sex abuse in the Philadelphia Archdiocese was released
in September 2005. While the statute of limitations may be
one of the most glaring legal issues in this case, the
Court concludes that this particular question is not
properly considered at the Rule 12(b)(6) stage. Robinson v.
Johnson, 313 F.3d 128, 135 (3d Cir. 2002) (may only dismiss
for Rule 12(b)(6) on statute of limitation grounds when the
bar is “apparent on the face of the complaint”). Given the
alleged fraudulent concealment and the potential
applicability of the Page 24 equitable tolling doctrine,
that the four-year RICO statute of limitations bars this
action is certainly not so facially apparent as to warrant
its dismissal on this ground.
B. Civil RICO Conspiracy in Violation of 18 U.S.C. §
1962(d) (18 U.S.C. § 1964(c))
Section 1962(d) provides that it “shall be unlawful for
any person to conspire to violate any of the provisions of
subsection (a), (b), or (c) of this section.” Plaintiffs’
RICO conspiracy claim cannot survive if the Complaint has
not sufficiently pled a substantive RICO claim based on
§ 1962(c). Lum, 361 F.3d at 227 n. 5 (district court
properly dismissed § 1962(d) claim where plaintiffs
failed to adequately plead a substantive RICO claim under
§ 1962(c)); Lightning Tube, Inc. v. Witco Corp., 4
F.3d 1153, 1191 (3d Cir. 1993) (“[a]ny claim under section
1962(d) based on a conspiracy to violate the other
subsections of section 1962 must necessarily fail if the
substantive claims are themselves deficient”). Since this
Court finds Plaintiffs have failed to adequately allege a
claim under § 1962(c), see supra Section III.A, it
follows that Plaintiffs’ § 1962(d) claim must be
dismissed as well.
C. Conspiracy For Deprivation of Civil Rights (42 U.S.C.
§ 1985(2) and (3))
Plaintiffs allege Defendants conspired to impede and
obstruct justice in violation of 42 U.S.C. §
1985(2)[fn14] and conspired to deprive Plaintiffs of equal
protection of the laws in violation Page 25 of 42 U.S.C.
§ 1985(3).[fn15] However, based on settled
constitutional principles, Plaintiffs have failed to state
a claim under either § 1985 provision.
Both § 1985(2) and (3) reach purely private
conspiracies. Brawer v. Horowitz, 535 F.2d 830, 839 (3d
Cir. 1976); Griffin v. Breckenridge, 403 U.S. 88, 96-101
(1971). The Supreme Court has interpreted § 1985(3)
and the second clause of § 1985(2) similarly,
finding that each contains language “requiring that the
conspirators’ actions be motivated by an intent to deprive
their victims of the equal protection of the laws.”[fn16]
Kush, 460 U.S. at 725. Furthermore, it is a settled
constitutional interpretation that “intent to deprive of
equal protection, or equal privileges and immunities, means
that there must be some racial, or perhaps otherwise
class-based, invidiously discriminatory animus behind the
conspirators’ action.” Id. at 726 (emphasis in original);
Bray, 506 U.S. at 272 n. 4 (applying Equal Protection
jurisprudence to § 1985(3) to Page 26 require
class-based discriminatory animus); Brawer, 535 F.2d at 840
(dismissing complaint for failing to state claim under
second half of § 1985(2) where there was no
allegation of class-based, invidiously discriminatory
animus).[fn17] The existence of such a discriminatory
animus is not presumed and intent to discriminate must be
clearly demonstrated. Palace v. Deaver, 838 F. Supp. 1016,
1020 (E.D. Pa. 1993). Moreover, section 1985(3) only
applies to “such conspiracies as are aimed at interfering
with rights . . . protected against private, as well as
official encroachment.” Bray, 506 U.S. at 278 (internal
quotations omitted) (quoting Carpenters v. Scott, 463 U.S.
825, 833 (1983)).
Therefore, in order to recover under § 1985(3),
plaintiff must plead (1) some class-based discriminatory
animus, (2) intent to deprive a right guaranteed against
private impairment, and (3) that the right was
intentionally targeted for impairment. Brown v. Phillip
Morris Inc., 250 F.3d 789, 805 (3d Cir. 2001). However, “in
the context of actions brought against private
conspirators, the Supreme Court has thus far recognized only
two rights protected under § 1985(3): the right to
be free from involuntary servitude and the right to
interstate travel.” Id.; Bray, 506 U.S. at 278.
Plaintiffs’ Complaint fails on all prongs. First,
Plaintiffs allege that they were members of a protected
class because they were “at all relevant times minor
children” or “members of the Page 27 Roman Catholic
Church.” Compl. §§ 125-26. The Supreme Court
has clarified that in order to constitute a “class of
persons” for § 1985(3), the persons must be “more
than a group of individuals who share a desire to engage in
conduct that the § 1985(3) defendant disfavors.”
Bray, 506 U.S. at 269. The group must consist of “victims
of historically pervasive discrimination” or those with
“immutable characteristics.” Pearson v. Miller, 988 F.
Supp. 848, 859 (M.D. Pa. 1997) (42 U.S.C. § 1985(3)
case) (quoting Carchman v. Korman Corp., 594 F.2d 354, 357
(3d Cir.), cert. denied, 444 U.S. 898 (1979)). Examples of
such recognized groups include women and the mentally
disabled. Lyes v. City of Riviera Beach, 126 F.3d 1380,
1389-90 n. 19 (11th Cir. 1997) (women as protected class);
Bedford v. Southeastern Pa. Transp. Auth., 867 F. Supp.
288, 294 (E.D. Pa. 1994) (because “[s]ex is an immutable
characteristic resulting from a fortuity of birth and women
historically have been victims of discrimination,” section
1985(3) encompasses gender-based animus); Lake v. Arnold,
112 F.3d 682, 686 (3d Cir. 1997) (extending class
protection in § 1985(3) case to mentally
handicapped). However, minor children have not been held to
be a protected class in the context of § 1985(3)
actions. Pearson, 988 F. Supp. at 859; Tazioly v. City of
Phila., 1998 WL 633747, *16 (E.D. Pa. Sept. 10, 1998)
(citing Pearson). On the other hand, there is conflicting
authority as to whether the reach of § 1985(3)
extends to include conspiracies motivated by religious
animus. Compare Word of Faith World Outreach Center Church,
Inc. v. Sawyer, 90 F.3d 118, 124 (5th Cir. 1996) (religious
animus not covered by § 1985(3)) with Ward v.
Connor, 657 F.2d 45, 48 (4th Cir. 1981) (religious
discrimination falls within ambit of § 1985). While
the Third Circuit has not explicitly addressed this issue,
its dictum suggests that religion-based animus would be
actionable under § 1985(3). See Wilson v. Rackmill,
878 F.2d 772, 775 (3d Cir. 1989) (since complaint alleged
defendants “acted against Page 28 [plaintiff] out of
racial and religious animus,” “[plaintiff] may have stated
a claim for conspiracy under § 1985”).
However, even if the Court assumes, arguendo, that
religious groups or minor children are protected classes
for § 1985(3) purposes, Plaintiffs nevertheless fail
to allege that Defendants’ actions were done by reason of
any discriminatory animus against members of either of
those groups.[fn18] Rather, Plaintiffs allege only that
Defendants preyed on the vulnerabilities of Plaintiffs as
members of those groups in carrying out their acts. See
Compl. § 125 (Defendants “used . . . Plaintiffs’
status as minor children, including their obedience to
adult authority and their susceptibility to the notion of
the sanctity of the pedophile priests” to perpetrate their
concealment), § 126 (Defendants “used . . .
Plaintiffs’ religious beliefs, including their belief in
God and the sanctity of the pedophile priests” to carry out
their wrongful acts). Such actions, while certainly morally
deplorable, nevertheless do not rise to allegations of any
discriminatory animus.
In addition, Plaintiffs do not allege the violation of any
right recognized to be protected under § 1985(3)
against private impairment, nor do they allege any state
action. Plaintiffs only claim violations of their
“substantive due process rights to bodily integrity” and
“substantive rights created under state law designed to
protect minor children.” Compl. §§ 142, 143.
In other parts of the Complaint, Plaintiffs plead another
deprivation: that of Plaintiffs’ “ability to seek legal
redress.” Id. §§ 127, 140 (Defendants
“obstructed the prosecution of Plaintiffs’ causes of action
against them”). However, there is no allegation that
Defendants’ conduct impinged on Page 29 Plaintiffs’ rights
to interstate travel and to be free from involuntary
servitude, the only two rights recognized under §
1985 to be protected from private encroachment. Therefore,
the Complaint fails to state a § 1985 cause of
action.
D. Knowing Neglect to Prevent 42 U.S.C. § 1985
Violation (42 U.S.C. § 1986)
A cognizable 42 U.S.C. § 1985 claim is a
prerequisite to stating a claim under § 1986.
Brawer, 535 F.2d at 841 (dismissing a § 1986 claim
because plaintiffs failed to state a claim under §
1985); Pearson, 988 F. Supp. at 859 (citing Robison v.
Canterbury Vill., Inc., 848 F.2d 424, 431 n. 10 (3d Cir.
1988)). Since Plaintiffs have not properly pled a §
1985 violation under any viable legal theory, their claim
under § 1986 must be dismissed as well.
IV. CONCLUSION
For the foregoing reasons, Defendants’ Motion to Dismiss
must be granted. In reaching this decision, the Court is
fully cognizant of the serious nature of the underlying
allegations at issue in this case. However, it is the duty
of the judiciary to apply the law as it has been written,
and as such this Court cannot force a moral wrong into a
legal mold where it clearly does not fit. The remedy lies
with Congress, not with the courts. An appropriate Order
follows. Page 30
ORDER
AND NOW, this 17th day of November 2006, upon careful
consideration of Defendants’ Motion to Dismiss (Doc. No.
4), Plaintiffs’ Response in Opposition (Doc. No. 7),
Defendants’ Reply thereto (Doc. No. 12), and after oral
argument by the parties, it is hereby ORDERED that
Defendants’ Motion to Dismiss is GRANTED, and that
Plaintiffs’ Complaint is DISMISSED. The Clerk of Court is
directed to close this matter for statistical purposes.
[fn1] In this case, because much of Plaintiffs’ Complaint
is based on the Grand Jury Report, this Court will also
consider the Report in evaluating Defendants’ Motion to
Dismiss.
[fn2] In particular, the Complaint states:
116. Plaintiffs have been injured in their business
and/or property by reason of their inability to pursue
claims for monetary damages against the Defendants for
personal injuries sustained as a result of the above
conduct due to the Defendants’ assertion of a defense
based on the statute of limitations. The fraudulent
racketeering activity set forth above was conducted for
the purpose of avoiding such civil liability and in order
to deny the Plaintiffs said monetary damages which they
were otherwise lawfully entitled to.
117. Plaintiffs have been and continue to be injured in
their business and/or property by reason of Defendants’
violations of 18 U.S.C. § 1962 et seq. Plaintiffs
suffered severe emotional and psychological stress and
illness as a result of the sexual abuse, which prevented
them from performing to their full capacity as productive,
working adults, thus causing them loss of earnings and
earning capacity. Plaintiffs also have suffered and will
continue to suffer out-of-pocket expenses relating to
medical and psychological treatment, therapy and
counseling necessitated by the acts of abuse.
Compl. §§ 116-17.
[fn3] However, there is legal support for the idea that an
alleged loss of employment may suffice as a RICO injury to
“property.” Diaz v. Gates, 420 F.3d 897, 900 (9th Cir.
2005) (en banc). The Diaz Court based its conclusion on a
distinction between “the mere loss of something of value
(such as wages)” and “injury to a property interest (such
as the right to earn wages).” Id. at 900 n. 1. There is
also authority from the Third Circuit to this effect. See
Shearin v. E.F. Hutton Group, Inc., 885 F.2d 1162, 1170 (3d
Cir. 1989) (in the commercial context, an alleged loss of
employment due to racketeering activity is injury to
“business” such that resulting loss of wages, benefits and
damages to reputation are compensable RICO injuries).
Regardless, such a distinction is not helpful to Plaintiffs
here since they do not allege that they lost any particular
employment through Defendants’ conduct, only that the
trauma they suffered from the alleged sexual abuse made them
less productive and less successful in their careers than
they otherwise would have been, resulting in reduced
earnings. See Compl. § 117.
[fn4] See, e.g., Hughes v. Tobacco Inst., Inc., 278 F.3d
417, 422 (5th Cir. 2001) (personal injuries arising from
allegations of tortious assault are not injuries to
“business or property”); Hamm v. Rhone-Poulenc Rorer
Pharm., Inc., 187 F.3d 941, 954 (8th Cir. 1999) (damage to
reputation is personal injury not cognizable under RICO);
Bast v. Cohen, Dunn & Sinclair, PC, 59 F.3d 492, 495 (4th
Cir. 1995) (extreme mental anguish insufficient to confer
RICO standing); Oscar v. Univ. Students Co-operative Ass’n,
965 F.2d 783 (9th Cir. 1992) (en banc) (personal discomfort
and annoyance not sufficient to state RICO cause of
action); Doe v. Roe, 958 F.2d 763, 767-68 (7th Cir. 1992)
(mental anguish and pain and suffering are not cognizable
RICO injuries to “business or property”); Grogan v. Platt,
835 F.2d 844, 846 (11th Cir. 1988) (loss of income based on
wrongful death action is not injury to “business or
property” despite its economic nature); Drake v. B.F.
Goodrich Co., 782 F.2d 638, 644 (6th Cir. 1986) (wrongful
death and personal injury from exposure to toxic chemicals
did not satisfy § 1964(c)’s injury to “business or
property” requirement); Bankers Trust Co. v. Rhoades, 741
F.2d 511, 515 (2d Cir. 1984) (“a person physically injured
in a fire whose origin was arson is not given a right to
recover for his personal injuries; damage to his business
or his building is the type of injury for which §
1964(c) permits suit”) (dictum), vacated on other grounds,
473 U.S. 922 (1985); see also Burnett v. Al Baraka Inv. and
Dev. Corp., 274 F. Supp. 2d 86, 100-02 (D.D.C. 2003)
(agreeing with the “overwhelming” authority that RICO
precludes personal injuries and pointing out dicta in prior
D.C. Circuit case suggesting the Circuit will follow the
other courts when it squarely addresses the issue).
[fn5] Section 4 of the Clayton Act provides, in relevant
part: “any person who shall be injured in his business or
property by reason of anything forbidden in the antitrust
laws may sue therefor . . . and shall recover threefold the
damages by him sustained, and the cost of suit, including a
reasonable attorney’s fee.” 15 U.S.C. § 15(a).
[fn6] One court, however, has held that for purposes of
RICO standing, money is “property” and a loss of money
constitutes an injury thereto. Blue Cross and Blue Shield
of New Jersey, Inc. v. Philip Morris, Inc., 36 F. Supp. 2d
560, 569 (E.D.N.Y. 1999). No court has specifically
rejected this broad conception of “property,” as subsequent
decisions discussing Blue Cross have focused only on the
issue of proximate causation. Nevertheless, Blue Cross has
been criticized by numerous courts. See Int’l Bhd. of
Teamsters, Local 734 Health and Welfare Trust Fund v.
Phillip Morris, Inc., 196 F.3d 818, 827 (7th Cir. 1999)
(Blue Cross is “thinly disguised refusal to accept and
follow” applicable Second Circuit precedent); see also
Allegheny Gen. Hosp. v. Phillip Morris, Inc., 228 F.3d 429,
445 (3d Cir. 2000) (expressly rejecting holding in Blue
Cross on issue of proximate cause); Rhode Island Laborers’
Health and Welfare Fund ex rel. Tr. v. Phillip Morris,
Inc., 99 F. Supp. 2d 174, 177-78 (D.R.I. 2000) (noting
Second Circuit holding to the contrary and refusing to
follow Blue Cross). Therefore, given the Third Circuit’s
decision in Genty and the fact that the Blue Cross decision
rests on tenuous legal footing, this Court declines to
follow Blue Cross insofar as it holds that all
out-of-pocket monetary losses are necessarily injuries to
“property” under § 1964(c). See, e.g., Doe, 958 F.2d
at 770 (“whether [plaintiff] can show a financial loss does
not, by definition, establish that she has suffered a
business or property injury within the meaning of §
1964(c)”).
[fn7] Insofar as Plaintiffs rely on Simon v. Playboy
Elsinore Associates, 1991 WL 71119 (E.D. Pa. April 29,
1991) and Hurley v. Hurley, 492 A.2d 439 (Pa.Super.Ct.
1985) for their assertion to the contrary on this point,
such reliance is misplaced. The issue in Simon was whether
a settled tort claim was property subject to a federal tax
lien. Simon, 1991 WL 71119, at *2. In Simon, plaintiffs
sued for personal injuries arising out of a slip and fall
occurring in a hotel operated by defendant. After the
defendant deposited funds with the court pursuant to a
settlement agreement, the federal government intervened to
levy against the settlement proceeds in order to satisfy
the plaintiffs’ outstanding tax obligations. 1991 WL 71119,
at *1 (E.D. Pa. April 29, 1991). After citing to Hurley
(the same case Plaintiffs rely on here for the opposite
proposition) for the idea that personal injury claims not
reduced to judgment are not assignable and not subject to
distribution as marital property, the Simon Court concluded
that different policies were at issue in the tax context
and as such, the government was entitled to levy against
the settlement proceeds of the in-progress tort claim at
issue. Id. at *2-3; see also Hurley, 492 A.2d at 441
(rights of action are not property in Pennsylvania) (citing
Sensenig, 78 A. at 92).
[fn8] To the extent that Plaintiffs attempt to quantify
their damages by relying on a report allegedly received by
the National Conference of Catholic Bishops in 1985
predicting that the failure of the Roman Catholic Church to
correct the “pervasive problem of child sexual abuse by
priests” “could result in liability for the church in
excess of one billion dollars ($1,000,000,000.00) over ten
years,” Compl. § 105, such an approach is
problematic. First, the report’s figure of “one billion
dollars” is merely an estimate, and estimates necessarily
involve some degree of uncertainty and speculation. Second,
the predicted liability figure is for the Catholic Church
as a whole, whereas the only issue here relates to the
liability of the Archdiocese of Philadelphia. Given the
myriad of uncertainties that would undoubtedly be inherent
in the process, even if the $1 billion estimate is accepted
at face value (which it is not), the Court declines to
engage in the entirely speculative exercise of attempting
to apportion such a liability estimate among the various
Archdioceses.
[fn9] Plaintiffs also allege that Defendants aided and
abetted the sexual abuse of children by their acts of
concealment, thereby “expanding the victim base for the
pedophile priests.” While this allegation may sufficiently
establish factual causation, even if Plaintiffs were able
to show that they were part of this expanded victim base,
proximate causation would nevertheless be attenuated, as
the direct injuries would still have resulted from
independent and intervening acts of the priests who
actually committed the sexual abuse. See Anderson v.
Ayling, 396 F.3d 265, 271 (3d Cir. 2005) (no proximate
causation where independent acts of third-parties
intervened between alleged racketeering conduct and
ultimate injury).
[fn10] Furthermore, Plaintiffs do not allege that any of
the alleged racketeering acts were ever done towards them,
namely, that any of the priests responsible for their abuse
were ever transferred or that Plaintiffs were bribed or
improperly coerced or the like based on their complaints.
In fact, with the exception of Mr. Porter, none of the
Plaintiffs allege that they ever told any of the Defendants
about their abuse. Even in Mr. Porter’s case, where he
allegedly passed a note complaining of the abuse he
suffered to Cardinal Bevilacqua in 1988, some twenty-three
years after he was abused, there are no allegations that
the Cardinal acted to conceal the complaint or engaged in
any acts of bribery or coercion or obstructions of justice
in that instance. Compl. § 41.
[fn11] While the Complaint does not provide the dates of
Cardinal Rigali’s tenure, according to his biography as
published on the Archdiocese of Philadelphia website, the
Cardinal was appointed as Archbishop of Philadelphia on
July 15, 2003 and was formally installed as such on October
7, 2003. See
http://archdiocese-phl.org./rigali/biorigali.htm. Prior to
2003, Cardinal Rigali served as the Archbishop of St.
Louis. Id. Because this information is a matter of public
record, and is both generally known and capable of accurate
and ready determination, the Court will take judicial
notice. See Fed.R.Evid. 201(b) (type of facts subject to
judicial notice); see also Buck v. Hampton Township School
Dist., 452 F.3d 256, 260 (3d Cir. 2006) (courts may
consider items subject to judicial notice and matters of
public record, in addition to the pleadings, when
evaluating motion to dismiss).
[fn12] The Complaint does not specify where in Title 18 the
alleged offenses are found. However, it appears that
Plaintiffs have used the general names of the offenses as
they are found in the definition of “racketeering activity”
18 U.S.C. § 1961(1). Therefore, this Court will
analyze the sufficiency of Plaintiffs’ allegations by
reference to § 1961(1) and the offenses provided
therein.
[fn13] With regard to Mr. Porter, the Complaint only alleges
that although his note to Cardinal Belivacqua contained his
contact information, he was never contacted. Compl.
§ 41.
[fn14] Section 1985(2) contains two distinct clauses. The
first deals with conspiracies to obstruct justice in
federal courts, and the second prohibits conspiracies to
obstruct justice in the states. See Kush v. Rutledge, 460
U.S. 719, 724-25 (1983). Plaintiffs have only alleged a
violation of the second clause, and as such all discussion
here only addresses that portion of the statute. The
relevant part of § 1985(2) provides:
If two or more persons conspire for the purpose of
impeding, hindering, obstructing, or defeating, in any
manner, the due course of justice in any State or
Territory, with intent to deny to any citizen the equal
protection of the laws . . . the party so injured or
deprived may have an action for the recovery of damages
occasioned by such injury or deprivation, against any one
or more of the conspirators.
[fn15] Section 1985(3) provides:
If two or more persons in any State or Territory conspire
or go in disguise on the highway or on the premises of
another, for the purpose of depriving, either directly or
indirectly, any person or class of persons of the equal
protection of the laws, or of equal privileges and
immunities under the laws; or for the purpose of
preventing or hindering the constituted authorities of any
State or Territory from giving or securing to all persons
within such a State or Territory the equal protection of
the laws . . . the party so injured or deprived may have
an action for the recovery of damages occasioned by such
injury or deprivation, against any one or more of the
conspirators.
[fn16] This Court rejects Plaintiffs’ assertion that the
second clause of § 1985(3) — the “prevention
clause” — is not subject to the class-based animus
requirement notwithstanding its “equal protection”
language. Pl.’s Resp. Brief at 22 (citing Bray v.
Alexandria Women’s Health Clinic, 506 U.S. 263, 302-03
(1993) (Souter, J., concurring)). This argument made by
Justice Souter in his Bray concurrence was also made by
Justice Stevens in dissent, but the argument was
nevertheless discounted and essentially rejected by the
majority. See Bray, 506 U.S. at 282 n. 13 (straightforward
application of Kush to the language of § 1985(3)’s
“prevention clause” results in contrary conclusion to that
reached by Justice Stevens).
[fn17] To the extent Plaintiffs rely on Britt v. Suckle to
claim § 1985(2) does not require a class-based
animus, that reliance is misplaced. 453 F. Supp. 987, 997
(E.D. Tex. 1978). First, the Britt decision is in direct
conflict with Third Circuit precedent in Brawer. Id. at 995
(noting Third Circuit holding that § 1985(2)
requires a class-based animus but declining to follow it).
Furthermore, as the Supreme Court subsequently noted in
Kush, the same “equal protection” language is found in
§ 1985(3) and in the second clause of §
1985(2), language which was interpreted in Griffin to
require some racial or other class-based discriminatory
animus. See Kush, 460 U.S. at 725; Bray, 506 U.S. at 282 n.
13 (Griffin’s animus requirement derived from an
interpretation of the “equal protection” language in
§ 1985(3)). As such, this Court has serious concerns
about whether Britt is good law, especially after Kush and
Bray.
[fn18] Indeed, Defendants themselves are members of the
same religious group as Plaintiffs — the Roman
Catholics.