The opinion of the court was delivered by: LOUIS F. OBERDORFER
This matter is before the Court on defendants' motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). Plaintiff's nine-count Second Amended Complaint alleges violations of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961-1968, and the Robinson-Patman Act, 15 U.S.C. § 13(c), as well as several pendent state law claims. Defendants argue that the complaint fails to state claims under RICO and Robinson-Patman, and that the remaining state claims should be dismissed under the authority of United Mine Workers of America v. Gibbs, 383 U.S. 715, 16 L. Ed. 2d 218, 86 S. Ct. 1130 (1966). For the reasons stated below, defendants' motion to dismiss will be denied.
Plaintiff Edison Electric Institute (EEI) is a Virginia non-stock corporation with its principal place of business in Washington, D.C. Defendant Jerry Henwood is an individual resident and citizen of Maryland. Henwood is the President and Treasurer of defendant Results Computer Services, Inc. (Results), a Virginia corporation with its principal place of business in Maryland.
According to the complaint, the target of the bribes was EEI's Director of Library Sciences and Information Systems. He was responsible for purchasing all computer equipment, services, and materials for EEL. Complaint P 7. The EEI employee was a manager and a fiduciary of EEI, and controlled a budget of approximately $ 1,100,000 in 1991 and over $ 800,000 in 1990. He also had significant control over other budgets, such as the capital expenditure budget and the relocation budget. Under these budgets, according to plaintiff, he exerted control over an additional $ 284,000 in 1991 and $ 1,600,000 in 1990. Id.
Plaintiff alleges that, between June 1988 and March 1992, Henwood, Results, and the EEI employee "devised and executed a scheme to defraud EEI and to obtain money from EEI using false pretenses," utilizing the United States Postal Service and telephones in interstate commerce. Id. at P 6. The complaint avers that Henwood and Results submitted at least 33 invoices to EEI totalling $ 124,460 for goods and services that were never provided. Id. at PP 15, 19. The EEI employee, knowing that he would receive kickbacks, allegedly approved these invoices, and EEI made payment on the invoices to Henwood and Results. Id. at P 14. Henwood and Results allegedly sent the EEI employee kickbacks through the mail for the invoices that EEI paid. Id. at P 16.
In addition, plaintiff alleges, Henwood and Results arranged through the EEI employee for EEI to do business with three vendors with which Henwood and Results were associated, Trawick & Associates (Trawick), Toppe Associates, Inc. (Toppe), and Condor Financial Services, Inc. (Condor). Id. at P 20. Trawick, Toppe, and Condor submitted at least 56 invoices to EEI. The EEI employee, knowing that he would receive kickbacks for this business, allegedly approved the invoices, for which EEI paid a total of $ 644,202. Id. at PP 28, 31. According to the complaint, Trawick, Toppe, and Condor paid Henwood and Results at least $ 123,553 for the EEI business. Henwood and Results sent a portion of that amount to the EEI employee as a kickback. Id. at PP 33, 34.
The complaint further alleges that defendants arranged for the EEI employee, Toppe, and Henwood to set up a venture called Optimum Computer Services (Optimum). Optimum allegedly offered goods and services to EEI without disclosing the EEI employee's interest in Optimum, or the fact that the EEI employee would receive a payment for money received from EEI. Id. at P 37. EEI paid Optimum at least $ 157,346 for goods and services. A portion of that amount was disbursed to the EEI employee in the form of kickbacks, according to the complaint. Id. at PP 37, 49.
The allegations in the complaint are taken as true for purposes of a motion to dismiss under Rule 12(b)(6). Such a motion should be granted only if "it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations." Hishon v. King & Spalding, 467 U.S. 69, 73, 81 L. Ed. 2d 59, 104 S. Ct. 2229 (1984). Defendants contend that the complaint fails to state a claim under either the RICO statute or the Robinson-Patman Act.
The RICO statute provides that it "shall be unlawful for any person employed by or associated with any enterprise . . . to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a ...