914 F.3d 1302
11th Cir.2019Background
- Al‑Rayes obtained a $25.7 million consent judgment (2006) against Ben Willingham but collected only ~$40k; he alleges Ben and wife Erika conspired to hide Ben’s assets to obstruct collection.
- Evidence from bankruptcy proceedings and bank records showed hundreds of wire transfers over ~11 years into Swiss accounts held in Erika’s name, transfers from those accounts into U.S. joint accounts, and use of funds for living expenses.
- Ben initially denied Swiss accounts and testified Erika controlled her own Swiss account; later admissions and bank records showed Ben had signatory authority on multiple Swiss accounts in Erika’s name and routed salary/benefits there.
- The couple failed to disclose substantial transactions (house sale, condo purchase, retirement‑home payments), placed real estate title in Erika’s name, created a trust in Erika’s name, and formed a corporation (Osborn) used for transfers and personal expenses.
- Al‑Rayes sued Erika under RICO §§ 1962(c) and (d) alleging an association‑in‑fact enterprise formed to conceal assets; the district court granted Erika summary judgment, finding no enterprise separate from the marital relationship, and awarded her costs. The Eleventh Circuit reversed and vacated the costs award.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Erika and Ben can constitute an association‑in‑fact enterprise under RICO | Al‑Rayes: their coordinated transfers, false sworn statements, title transfers, trust and corporate activity show a shared purpose and sufficient structure/relationships and longevity to form an enterprise | Erika: the conduct was domestic, marital, and personal management; marriage predated alleged scheme and no separate enterprise or businesslike structure was formed | Court: Reversed — a preexisting marital relationship does not preclude finding an association‑in‑fact; the evidence could permit a jury to find a common purpose to commit fraud and the requisite structural features under Boyle |
| Whether the district court properly awarded costs to Erika | Al‑Rayes: judgment should not stand; costs inappropriate if summary judgment is reversed | Erika: as prevailing party below, she was entitled to costs under Rule 54(d)(1) | Court: Vacated costs award because reversal removes Erika’s prevailing‑party status |
Key Cases Cited
- Boyle v. United States, 556 U.S. 938 (2009) (defines association‑in‑fact enterprise and rejects requirement that enterprise be businesslike)
- United States v. Turkette, 452 U.S. 576 (1981) (association‑in‑fact: group associated for common purpose of engaging in a course of conduct)
- Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479 (1985) (RICO to be read broadly; elements of §1962(c) articulated)
- Almanza v. United Airlines, Inc., 851 F.3d 1060 (11th Cir. 2017) (association‑in‑fact enterprise requires purpose, relationships, and sufficient longevity)
- Crowe v. Henry, 43 F.3d 198 (5th Cir. 1995) (association‑in‑fact can be formed by preexisting friends/business associates)
- United States v. Torres‑Lopez, 851 F.2d 520 (1st Cir. 1988) (preexisting institutional relationships do not bar finding an enterprise)