The opinion of the court was delivered by: Judge Mattice
Before the Court are Defendants Coffee County Realty and Auction, LLC's and Freda Jones's Motion to Dismiss [Court Doc. 24] and Defendant Curtis Williamson's Motion to Dismiss [Court Doc. 26] pursuant to Federal Rule of Civil Procedure 12(b)(6). As Defendant Williamson's motion merely incorporates the other Defendants' arguments, the Court will address both motions simultaneously.
I. FEDERAL RULE OF CIVIL PROCEDURE 12(B)(6) STANDARD
Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint that fails to state a claim upon which relief can be granted. The purpose of Rule 12(b)(6) is to permit a defendant to test whether, as a matter of law, the plaintiff is entitled to relief even if everything alleged in the complaint is true. Mayer v. Mylod, 988 F.2d 635, 638 (6th Cir. 1993). To survive a motion to dismiss under 12(b)(6), plaintiff's "factual allegations must be enough to raise a right to relief above the speculative level on the assumption that all the allegations in the complaint are true." Assoc. of Cleveland Fire Fighters v. City of Cleveland, 502 F.3d 545, 548 (6th Cir. 2007) (citing Bell Atlantic v. Twombly, 127 S.Ct. 1955, 1974 (2007)). "[A] plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. The Court must determine not whether the plaintiff will ultimately prevail but whether the plaintiff is entitled to offer evidence to support his claims. Scheuer v. Rhodes, 416 U.S. 232, 236 (1974). In making this determination, the Court must construe the complaint in the light most favorable to plaintiff and accept as true all well-pleaded factual allegations. Mixon v. Ohio, 193 F.3d 389, 400 (6th Cir. 1999). The Court need not accept as true mere legal conclusions or unwarranted factual inferences. Id.
As their only federal causes of action, Plaintiffs bring two claims under the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. §§ 1961-1968. Specifically, Plaintiffs allege that Defendants are liable under § 1964(c), which attaches civil liability to criminal RICO violations, for violations of § 1962(c) (prohibiting racketeering activity) and § 1962(d) (prohibiting a conspiracy to violate, inter alia, § 1962(c)).
Specifically, Plaintiffs allege that Defendants violated several criminal laws in constructing and brokering a parcel of improved real property purchased by Plaintiffs. (Court Doc. 1-3, Compl. ¶ 7.) Plaintiffs allege that Defendants violated 8 U.S.C. §§ 274 and 1324 (employing illegal immigrant labor), 18 U.S.C. § 1341 (mail fraud), 18 U.S.C. § 1343 (wire fraud), 18 U.S.C. § 1956 (money laundering), and 18 U.S.C. § 2314 (transportation of stolen property). (Id. ¶¶ 13, 15, 21, 25-26,.) According to Plaintiffs' allegations of fraud, Defendants worked together to conceal defects in the site preparation, construction, and zoning of the real property and improvements at issue.
(Id. ¶ 10.) Plaintiffs also allege that Defendant Williamson employed illegal immigrants in constructing the improvements to the real property (Id. ¶¶ 15-16). Finally, Plaintiffs aver that Defendants "transported in interstate commerce property which was not the property of the Defendants and which was, in fact, the property of the Plaintiffs." (Id. ¶ 26.) Plaintiffs fail to support the remaining alleged criminal violations listed above with any factual allegations.
Section 1962(c) provides that [i]t shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt.
To establish a cause of action under this section, a plaintiff must adequately plead the following elements: "(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity." Sedima, S.P.R.L. v. Imrex Co., Inc., 473 U.S. 479, 496 (1985). As Defendants argue that Plaintiffs have failed to sufficiently plead several of these elements, the Court will address each element in turn.
To establish a prima facie RICO violation, a plaintiff must first allege that defendants engaged in certain criminal conduct described in 18 U.S.C. § 1961(1), which is otherwise termed a predicate act. Although Plaintiffs' Complaint lists several predicate acts, most of these allegations are bare and conclusory assertions of criminal conduct, with no supporting factual allegations. As such, these allegations do not survive Defendants' Motion to Dismiss. Cleveland Fire Fighters, 502 F.3d at 548 Plaintiffs do, however, aver facts to support several allegations of fraud under 18 U.S.C. §§ 1341 (mail fraud) and 1343 (wire fraud), use of illegal immigrants in violation of 8 U.S.C. §§ ...