Rule 59(e) allows a party to file a motion to alter or amend a judgment no later than ten days after entry of the judgment. Fed.R.Civ.P. 59(e). Motions for reconsideration enable a party to request that the district court correct manifest errors of law or fact. Publishers Resource, Inc. v. Walker-Davis Publications, Inc., 762 F.2d 557, 561 (7th Cir. 1985). Specifically, a motion for reconsideration is proper when "the Court has patently misunderstood a party, or has made a decision outside the adversarial issues presented to the Court by the parties, or has made an error not of reasoning but of apprehension. A further basis for a motion to reconsider would be a controlling or significant change in the law or facts since the submission of the issues to the Court. Such problems rarely arise and the motion to reconsider should be equally rare." Bank of Waunakee v. Rochester Cheese Sales, Inc., 906 F.2d 1185, 1191 (7th Cir. 1990).
In this case, the plaintiff requests this Court to vacate its Memorandum Opinion and Order pursuant to Fed.R.Civ.P. 59(e) because the first amended complaint "did not adequately convey to the Court that the dealer was acting as the agent of Perino in obtaining financing, that MFC Illinois induced the dealer to breach the duty it owed Perino as his agent and that MFC Illinois' conduct is explicitly illegal because it constitutes commercial bribery in violation of 720 ILCS 5/29A-1." In further support of his motion, the plaintiff requests leave to file a second amended complaint which, when "taken into consideration" by the Court, demonstrates that "MFC Illinois' action[s] are in violation of Illinois law and illegal."
In order to state a claim under RICO, 18 U.S.C. § 1962(c), the plaintiff must establish "(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity." Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496, 87 L. Ed. 2d 346, 105 S. Ct. 3275 (1985); McDonald v. Schencker, 18 F.3d 491, 494 (7th Cir. 1994). A pattern of racketeering activity consists of at least two predicate acts of racketeering committed within a ten year period. See 18 U.S.C. § 1961(5). RICO defines "racketeering activity," also referred to as "predicate acts," as acts indictable under any one of several federal or state offenses, including mail fraud under 18 U.S.C. § 1341. See 18 U.S.C. § 1961(1)(B); Midwest Grinding Co., Inc. v. Spitz, 976 F.2d 1016, 1019 (7th Cir. 1992).
The racketeering activity on which the plaintiff's complaint was premised was mail fraud. See 18 U.S.C. § 1341. This type of RICO claim requires the plaintiff to establish that the defendant (1) has participated in a scheme to defraud and (2) has mailed or knowingly has caused to be mailed a letter or other material for the purpose of executing the scheme. McDonald, 18 F.3d at 494. The mail fraud provision encompasses any "scheme to [defraud or] deprive another of money or property by means of false pretenses, representations, or promises." Richards v. Combined Insurance Company of America, 55 F.3d 247, 251-252 (7th Cir. 1995) (quoting Carpenter v. United States, 484 U.S. 19, 27, 98 L. Ed. 2d 275, 108 S. Ct. 316 (1987)). The words "to defraud" in the mail fraud statute "usually signify the deprivation of something of value by trick, deceit, chicane or overreaching." Richards, 55 F.3d at 252 (quoting McNally v. United States, 483 U.S. 350, 358, 97 L. Ed. 2d 292, 107 S. Ct. 2875 (1987)).
In this case, we dismissed the RICO claim because the plaintiff failed to allege a "racketeering activity" or "predicate act" of mail fraud as required by the statute. Specifically, we found that the plaintiff failed to allege any scheme to defraud. The plaintiff's "kickback" allegations focused on nondisclosure of the transaction or discount between MFC Illinois and Mancari Chrysler. However, the alleged failure to disclose this discount does not violate either federal or state law in a manner which triggers the RICO statute. MFC Illinois made all required disclosures under the federal Truth-in-Lending Act. Accordingly, MFC Illinois did not engage in fraudulent conduct which constitutes a "scheme to defraud" under the mail fraud statute, and his RICO claim must therefore fail. Moreover, we reemphasize that the plaintiff's repeated allegations of "secret agreements" and "kickbacks" do not transform this conduct into actionable fraud under RICO.
The plaintiff now requests this Court to consider a second amended complaint in support of his motion. The defendant correctly notes that Rule 59(e) does not concern amendments to pleadings. Even if we consider the new complaint as the plaintiff requests, the second amended complaint still fails to state a federal RICO claim. According to the plaintiff's own admission, the additional language in the second amended complaint merely alleges another state law claim. Specifically, the plaintiff alleges that MFC Illinois' conduct is illegal because "it constitutes commercial bribery in violation of 720 ILCS 5/29A-1." Only certain state offenses which are "chargeable under State law and punishable by imprisonment for more than one year" constitute "racketeering activity" under the RICO statute. See 18 U.S.C. § 1961(1)(A). Although bribery is defined as a "racketeering activity" under RICO, 18 U.S.C. § 1961(1)(A), commercial bribery under Illinois law is only punishable by a fine not exceeding $ 5000. See 720 ILCS 5/29A-3. Therefore, this additional state law claim does not trigger the RICO statute. We must deny the plaintiff's motion to alter or amend the judgment.
For all of the foregoing reasons, the plaintiff's motion to alter or amend the judgment pursuant to Fed.R.Civ.P. 59(e) is hereby denied. The defendant's request that the Court impose Rule 11 sanctions is also denied. It is so ordered.
Wayne R. Andersen
United States District Judge
Dated: October 12, 1995
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