City of Almaty v. Viktor Khrapunov, 956 F.3d 1129

Victor Khrapunov, as mayor of Almaty (1997–2004), allegedly rigged property privatizations so family members bought city real estate at below-market prices.
The Khrapunovs fled to Switzerland with the sale proceeds; Swiss authorities investigated and froze their accounts after Kazakh authorities traced the funds there.
Almaty alleges the family laundered stolen proceeds into the United States (notably Beverly Hills real estate and sham investments) and cycled funds to frustrate recovery.
Almaty sued in U.S. federal court (2014; operative consolidated complaint 2018), asserting RICO and related federal and state claims alleging domestic money laundering harms.
The district court dismissed Almaty’s RICO claim for failure to allege a domestic injury under RJR Nabisco; Almaty appealed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Almaty’s expenditures in the U.S. to trace stolen funds constitute a "domestic" injury under 18 U.S.C. § 1964(c)	Almaty: being compelled to expend resources in the U.S. to locate laundered assets is a domestic injury to its property	Khrapunovs: RJR Nabisco forecloses treating such voluntary tracing expenditures as domestic injuries	Court: Did not adopt a new test; held Almaty’s expenditures are merely consequential of the foreign theft and not a cognizable independent RICO injury
Whether Almaty’s expenditures were proximately caused by defendants’ U.S. money laundering (RICO causation)	Almaty: laundering forced it to spend money to trace and recover funds, so proximate cause exists	Khrapunovs: no direct causal link; expenditures were voluntary and not compelled by a U.S. governmental or adjudicative requirement	Court: No proximate causation. Unlike Harmoni or Maiz (where defendant conduct directly compelled or caused the loss), here laundering was not the direct cause of Almaty’s tracing expenses
Whether Almaty lacks standing in its sovereign capacity to bring RICO claims	Almaty: pursued claims as the municipal plaintiff	Khrapunovs: argued Almaty lacks standing in sovereign capacity (raised on appeal)	Court: Did not decide standing; the argument was not raised below and the panel affirmed on the ground Almaty failed to allege a cognizable injury

RJR Nabisco, Inc. v. European Community, 136 S. Ct. 2090 (2016) (presumption against extraterritoriality applies to § 1964(c))
Holmes v. Securities Investor Prot. Corp., 503 U.S. 258 (1992) (RICO proximate-cause requirement: injury must have direct relation to predicate acts)
Harmoni Int'l Spice, Inc. v. Hume, 914 F.3d 648 (9th Cir. 2019) (expenses compelled by a statutorily required administrative review can be a RICO injury proximately caused by defendant filings)
Diaz v. Gates, 420 F.3d 897 (9th Cir. 2005) (RICO injury must be harm to business or property under state-law principles)
Canyon County v. Syngenta Seeds, Inc., 519 F.3d 969 (9th Cir. 2008) (government expenditures in sovereign capacity are generally not RICO injuries; commercial expenditures may be)
Maiz v. Virani, 253 F.3d 641 (11th Cir. 2001) (money laundering integral to scheme can be the proximate cause of plaintiffs’ losses)
Reiter v. Sonotone Corp., 442 U.S. 330 (1979) (governmental commercial overcharges can constitute injury to property)
United States v. Sperry Corp., 493 U.S. 52 (1989) (money is fungible; not uniquely identifiable property in some contexts)