The opinion of the court was delivered by: FLANNERY
This case involves a dispute over $ 5,000 lent by plaintiff, Harvey Barlow, to defendant Larry McLeod. Apparently, Barlow lent the money as part of an agreement with McLeod in which he was promised a job with McLeod's corporation, Human Development Systems ("HDS"), if McLeod was successful in obtaining a government contract. McLeod did not get the contract, did not hire Barlow, and then paid Barlow only $ 300 on the loan before defaulting.
At the time the loan was made, Larry McLeod operated HDS out of an office given him by his brother, Bobby McLeod. Bobby McLeod ran his own company, McLeod Corporation, in offices adjacent to the one he had rented for his brother. McLeod Corporation became involved in the agreement between Barlow and Larry McLeod because James Lieberman, an employee of the company who had attended law school, was asked by them to review the language of the loan agreement. Additionally, McLeod Corporation had to cash Barlow's $ 5,000 loan check because Barlow, apparently by mistake, named it as payee and because HDS had no bank account of its own.
After Larry McLeod's default, Barlow sued naming as defendants not only Larry McLeod and HDS, but also Bobby McLeod, McLeod Corporation, and James Lieberman. Barlow alleged a violation of the Racketeer Influenced and Corrupt Organizations Act ("RICO"), a conspiracy to violate RICO, violations of the D.C. Consumer Protection Act, fraud, and conspiracy to defraud, in addition to an action for the money lent.
On June 10, 1986, this court affirmed a magistrate's decision to enter a default judgment against defendant HDS. On July 23, 1986, this court affirmed the magistrate's decision to impose sanctions, against defendants Bobby McLeod and McLeod Corporation for refusal to produce documents, in the form of entering a default judgment on Count VI of the complaint -- the money lent. Presently before the court is defendant Lieberman's motion for summary judgment and for sanctions.
II. MOTION FOR SUMMARY JUDGMENT
Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." In determining whether there is a genuine issue for trial, this court is guided by the recent Supreme Court decision in Anderson v. Liberty Lobby, Inc., where the Court held that "the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." 477 U.S. 242, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986) (emphasis in original).
In his complaint, Barlow alleges a violation and a conspiracy to violate "the RICO statute." As Lieberman notes in his motion for summary judgment, plaintiff does not specify what subsection of the Act has been violated. Furthermore, plaintiff asserts the essential elements of a RICO claim (existence of an enterprise, how it affects interstate commerce, and a pattern of racketeering activity) in a conclusory manner. Whether or not such limited allegations could survive a Rule 12(b)(6) motion to dismiss, this court must now consider whether the allegations, in conjunction with supporting affidavits, depositions, and other documents, are sufficient to defeat a motion for summary judgment.
Taking all the available evidence in the light most favorable to the plaintiff, it is clear that defendant is entitled to summary judgment on the RICO claims. First, plaintiff has presented no evidence of a RICO enterprise. Second, plaintiff has presented no colorable evidence that defendant Lieberman was involved in a RICO violation. Third, the alleged predicate acts clearly do not constitute a pattern of racketeering activity.
With regards to the RICO enterprise requirement, the complaint baldly asserts that McLeod Corporation and HDS are "enterprises." There is no proof, however, that these two entities were associated for the common purpose of engaging in a course of conduct or a pattern of racketeering activity. Plaintiff's support for his contention of concerted action is limited to the fact that Larry McLeod's brother cashed Barlow's $ 5,000 check for him. Such support is innuendo at best, especially since McLeod's brother went to such extremes as opening a special trust account for the check, transferring the funds immediately to Larry McLeod, and informing plaintiff in writing of the entire transaction, to make sure he and his company, McLeod Corporation, operated independently of Larry McLeod and his company, HDS. Obviously this court's function is not to weigh this evidence, but only to determine whether it is sufficient to present an issue for trial. Where, as here, the evidence is at best "merely colorable" and "is not significantly probative," summary judgment is appropriate. Anderson v. Liberty Lobby, Inc., 106 S. Ct. at 2511.
Plaintiff has also presented no colorable evidence that defendant Lieberman was involved in a RICO violation. Lieberman's only connection to the transaction with Barlow was that he was asked to look over the loan agreement and suggest technical revisions -- presumably based on his legal knowledge. Barlow has admitted in a deposition, however, that he did not rely on Lieberman's presence and would have entered the agreement anyway. Barlow deposition, March 13, 1986, at 170-72. His complaint details no specific acts by Lieberman other than a generalized claim that he was part of a fraudulent scheme to dupe the plaintiff out of the $ 5,000. Such an allegation does not set forth even a RICO conspiracy claim.
A RICO conspiracy allegation requires pleading the existence of at least one overt act by a defendant in furtherance of the conspiracy and the assent of each defendant to the conspiracy. Van Dorn Co., Central States Can Co. Division v. Howington, 623 F. Supp. 1548, 1559 (N.D. Ohio 1985) (and cases cited therein). Not even plaintiff's opposition to the motion for summary judgment, let alone the original complaint, sets forth a proper RICO conspiracy claim because plaintiff's allegation on this count is a mere ...