Third Circuit Affirms Dismissal of RICO Lawsuit Against Major Insurers
Case Study

Third Circuit Affirms Dismissal of RICO Lawsuit Against Major Insurers

Two major national insurers beat back a pro se plaintiff’s RICO claims, securing a decision from U.S. Court of Appeals for the Third Circuit affirming a federal district court’s prior ruling in their favor. Goldberg Segalla partners Jonathan M. Kuller and Stewart G. Milch represented the insurers, coordinating their approach to dispatch both the trial and appeal as efficiently as possible.

In a 2015 lawsuit a pro se plaintiff sued a group of large national insurance companies in the U.S. District Court for the District of New Jersey, alleging the insurers had committed violations under the Racketeer Influenced and Corrupt Organizations (RICO) Act in connection with a 2012 New Jersey state court action that had been dismissed. Her suit included allegations that Goldberg Segalla’s clients conspired with other defendants in the state court case to withhold evidence and file false documents, and also committed mail fraud, wire fraud, and extortion. Jonathan, an experienced first-party coverage litigator and GIS New Jersey team leader, lead the defense in the district court and successfully moved to dismiss the complaint.

Recognizing the likelihood of an appeal early on, Jonathan recommended that Stu, co-chair of the firm’s national Appellate practice, monitor the district proceedings. Stu took the lead when the plaintiff did appeal, and won an affirmation of the lower court’s decision, holding that the plaintiff’s complaint did not sufficiently allege any predicate acts necessary to support a RICO claim. Specifically, the court held that the alleged witness tampering did not occur in an official proceeding; that the claims of mail fraud were not specifically pleaded as required by Federal Rule of Civil Procedure 9(b); nor did the plaintiff sufficiently plead facts supporting her extortion claim.