separate schemes; and (d) the occurrence of distinct injuries).
The racketeering activity upon which Plaintiffs premise their RICO claims is mail and wire fraud. See 18 U.S.C. §§ 1341, 1343. Such a RICO claim requires that the plaintiffs 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, or used the wire service, for the purpose of executing the scheme. McDonald v. Schencker, 18 F.3d 491, 494 (7th Cir. 1994); Marcial v. Coronet Ins. Co., 880 F.2d 954, 958 (7th Cir. 1989). To support their RICO claim here, therefore, Plaintiffs must establish that Defendant knowingly schemed to defraud Plaintiffs of their property and used the mail or wire services in furtherance of this scheme. See Marcial, 880 F.2d at 958.
Defendant argues that he cannot be liable under § 1962(c) because there is no evidence that he committed a pattern of racketeering activity, i.e. at least two predicate offenses "related and that amount to, or threaten the likelihood of, continued racketeering activity." Initially, Defendant asserts that neither he nor Loyola L employees at his direction ever used the United States Postal Service or engaged in interstate use of any wire service in connection with any of actions Plaintiffs allege he conducted. (Def. Mem., Ex. A at P 5.) Defendant asserts that all of Loyola L's banking transactions occurred via a contracted armored car carrier. (Id. at P 10.)
Defendant also states that he never made interstate telephone calls with regard to any of the communications alleged in Plaintiffs' complaint; the initial calls between Favia, Lewis and Defendant setting up Favia's initial check cashing at Loyola L occurred while all parties were located within Illinois.
In opposition to summary judgment, Plaintiffs argue that the evidence demonstrates that Defendant can be charged directly with the acts of mail and wire fraud constituting the RICO predicate acts and pattern of racketeering activity. Plaintiffs note that: (1) Favia and Defendant came together for the cashing of the first check through a mutual friend, Lewis; (2) Defendant, then, agreed to cash the first check for Favia; (3) Favia continued to return to Loyola L to cash checks made out to different entities; (4) the Loyola L cashiers continued to cash the checks presented by Favia; and (5) Defendant accepted the fruits of the fraudulent scheme because the Loyola L corporate entity deducted and retained a percentage of the check cashed by Favia as a fee.
After a careful review of the facts set forth by Plaintiffs, this court finds that the evidence Plaintiffs present in opposition to Defendant's summary judgment motion does not raise a material issue of fact regarding whether Defendant conducted or participated (as defined above) in the check cashing scheme through a pattern of racketeering activity. Plaintiffs, dispositively, have simply not presented any evidence that Defendant made any interstate phone calls or utilized the postal service regarding the check cashing scheme. Therefore, Plaintiffs have not established the requisite mail or wire fraud essential to a § 1962(c) violation. See Marcial, 880 F.2d at 958.
Plaintiffs additionally insinuate that Defendant indirectly participated in the scheme and is therefore subject to "aider and abettor liability" under § 1962(c).
As Magistrate Judge Ashman explained in ruling on Defendant's motion to dismiss, the elements for pleading a claim of aiding and abetting are: (1) the existence of an independent wrong committed by the primary offender; (2) the rendering of substantial assistance to the primary wrongdoer by the aider and abettor; and (3) the requisite scienter on the aider and abettor. R.E. Davis Chem. Corp. v. Nalco Chem. Co., 757 F. Supp. 1499, 1515 (N.D. Ill. 1990). "Substantial assistance means more than just a little aid. To put it another way, to be held liable as an aider and abettor, a person must in some sort associate himself with the venture, . . . participate in it as something that he wishes to bring about, [and] seek by his action to make it succeed." FMC Corp. v. Boesky, 727 F. Supp. 1182, 1200 (N.D. Ill. 1989) (internal citations and quotations omitted).
A thorough review of the facts set forth by Plaintiffs shows that Plaintiffs cannot survive summary judgment on their aider and abettor theory. Plaintiffs have not demonstrated that there is a material issue of fact that Defendant substantially assisted Favia's fraudulent cashing of the checks. Nor have Plaintiffs set forth evidence which would raise a material issue of fact that Defendant had the requisite intent to assist in such a scheme.
Specifically, the mere fact that Defendant authorized the cashing of the initial check, after being assured by a trusted business acquaintance, inter alia, that the check was "good," is, in isolation, innocuous on its face. Even coupling this with the fact that employees of the currency exchange subsequently uncarefully cashed Favia's properly signed checks (which cleared for years), Plaintiffs evidence, even with all reasonable inferences therefrom favorable to Plaintiffs, is insufficient to meet the requisite scienter (or substantial assistance) requirements against the Defendant here. In short, in the face of the Defendant's (and Lewis') sworn evidence of non-knowledge, it cannot be reasonably inferred from a single unspecial check authorization and mere later check cashings (albeit uncareful) by firm employees that Defendant knew of (or assisted in) Favia's fraudulent check cashing scheme.
In sum, summary judgment must be granted Defendant as to Plaintiffs' § 1962(c) claim.
III. 18 U.S.C. § 1962(d).
Section 1962(d) prohibits a conspiracy to violate any of RICO's other substantive provisions, including § 1962(c). 18 U.S.C. § 1962(d). Here, plaintiffs allege that defendants conspired to commit a § 1962(c) violation. As with any conspiracy charge, in order to prevail on their claim, plaintiffs must proffer evidence of an agreement between and among the defendants. See United States v. Neapolitan, 791 F.2d 489, 497 (7th Cir. 1986) ("[A] conspiracy to violate RICO should not require anything beyond that required for a conspiracy to violate any other federal crime.").
Agreement is the cornerstone of any RICO conspiracy claim. Gagan v. American Cablevision, Inc., 77 F.3d 951, 960 (7th Cir. 1996). In fact, it is the agreement to violate RICO's substantive provisions, not the actual violations themselves, that imposes liability under § 1962(d). Schiffels v. Kemper Fin. Serv., Inc., 978 F.2d 344, 348 (7th Cir. 1992). The Seventh Circuit has observed:
"From a conceptual standpoint a conspiracy to violate RICO can be analyzed as composed of two agreements [.]" Neapolitan, 791 F.2d at 499. The first is "an agreement to conduct or participate in the affairs of an enterprise [or to acquire or maintain any interest in or control of any enterprise] through a pattern of racketeering activity." Id. at 498. The second is "an agreement to the commission of at least two predicate acts." Id. at 499. If either aspect of the agreement is lacking then there is insufficient evidence that the defendant embraced the objective of the alleged conspiracy. Finally, a "RICO conspiracy, like all conspiracies, does not require direct evidence of agreement; an agreement can be inferred from the circumstances." Id. at 501 (citing Glasser v. United States, 315 U.S. 60, 80, 86 L. Ed. 680, 62 S. Ct. 457 (1942)).
Gagan, 77 F.3d at 961.
Accordingly, to withstand a motion for summary judgment, Plaintiffs must show that a genuine issue exists as to whether Defendant agreed to conduct (or participate in the conduct of) the check cashing scheme through a pattern of racketeering activity, and that Defendant further agreed that someone would commit at least two predicate acts to accomplish those goals. Plaintiffs are not required to show, however, that Defendant committed the predicate acts himself, Schiffels, 978 F.2d at 348, or that Defendant agreed to commit the predicate acts himself or even participate in their commission. Neapolitan, 791 F.2d at 498 (breadth of RICO conspiracy liability extends even to "those persons who while intimately involved in the conspiracy, neither agreed to personally commit nor actually participated in the commission of the predicate" offenses). Rather, Plaintiffs need only demonstrate that Defendant agreed that the acts would be committed on behalf of the conspiracy. See, e.g., United States v. Quintanilla, 2 F.3d 1469, 1484 (7th Cir. 1993); United States v. Campione, 942 F.2d 429, 437 (7th Cir. 1991).
In its motion, Defendant argues that there is no evidence that Fishman agreed that two predicate acts would be committed on behalf of the conspiracy. Initially, Defendant states that he only authorized the cashing of the first check, innocuously, after a trusted business acquaintance (Lewis) vouched for the check and stated the check was "good." Defendant points to Lewis' affidavit, which Defendant maintains is unrebutted, which expresses Lewis had no knowledge or involvement in Favia's check cashing scheme. Defendant further states that, in any event, his permission for Favia to cash one check on one occasion does not establish Defendant's ongoing participation in the alleged check cashing scheme. Instead, Defendant maintains that, after Favia's first transaction at Loyola L, Loyola L's employees took it upon themselves to cash the checks presented by Favia. Defendant argues that in the face of his sworn affidavit of non-knowledge and non-participation any perceived check cashing shortcomings by employees at Loyola L do not establish his agreement to or knowing participation in the check cashing scheme or the commission of any predicate act under RICO.
In response, Plaintiffs argue that the evidence demonstrates that Fishman was involved in a RICO conspiracy. Plaintiffs note that the evidence demonstrates that Defendant authorized Favia to cash his first check. Plaintiffs note that Loyola L employees continued to cash the checks presented by Favia regardless of who was listed on the check as the payee. Plaintiffs additionally argue that Loyola L employees did not follow usual safeguards or procedures set up by the currency exchange in dealing with Favia's checks (even after one of Favia's checks was returned to Loyola L for insufficient funds).
Plaintiffs also suggest that certain deposition testimony provides evidence of an agreement with Favia. A careful review of the deposition testimony, however, fails to support Plaintiffs' claim. Plaintiffs first suggest that Defendant's own deposition testimony demonstrates his agreement with Favia. Defendant, however, testified that he could not recall if he had ever met Favia and that his only communication with Favia was that Favia "called [Defendant] possibly to ask [Defendant] if he [could] cash one of his company checks." (Pls. 12(n), Ex. B at pp. 33-34.) Plaintiffs also suggest that deposition testimony by a Loyola L employee demonstrates that Defendant authorized Favia to cash a later check on February 26, 1992. However, review of the deposition testimony cited discloses that the employee was referring to the initial check cashing incident that the Defendant approved, and not to a subsequent check cashing incident. (Pls. 12(n), Ex. E at pp. 10-23.)
This court finds that the deposition testimony and other evidence Plaintiffs have set forth in opposition to Defendant's summary judgment motion with regard to the § 1962(d) claim is insufficient to meet Plaintiffs' burden of proof that Defendant was involved in a conspiracy. Although it is true that evidence of a conspiratorial agreement can be proven by circumstantial evidence, see Gagan, 77 F.3d at 961, Defendant's alleged membership in the conspiracy here cannot reasonably be inferred from the circumstantial evidence presented by the Plaintiffs herein.
In sum, Plaintiffs have not carried their burden of presenting or pointing to evidence which demonstrates the existence of a genuine issue of material fact to support a RICO conspiracy claim under § 1962(d).
For the reasons set forth above, Defendant's motion for summary judgment is granted, and the cause is dismissed with prejudice.
IAN H. LEVIN
United States Magistrate Judge
Dated: January 5, 1998