Background - Plaintiff Jorge Yarur Bascuñán (Chilean resident) sued his cousin Daniel Yarur Elsaca (also Chilean) in S.D.N.Y. under civil RICO, alleging multiple schemes by Elsaca to misappropriate roughly $64 million from an estate Bascuñán controls. - Alleged schemes included: transfers from a J.P. Morgan New York trust account (Afghan/Capri Star trusts), a Chilean private fund (Anacapri) that dissipated assets and laundered funds (some through U.S. accounts), theft of bearer shares from a J.P. Morgan New York safety‑deposit box, and diversion of dividends to Morgan Stanley accounts in New York. - After the Supreme Court decided RJR Nabisco (holding §1964(c) does not reach foreign injuries), defendants moved to dismiss for failure to allege a “domestic injury.” - The district court treated the alleged harm as a single $64 million economic loss and held that because Bascuñán is a Chilean resident his injuries were foreign and dismissed the complaint; it also denied leave to file a second amended complaint as futile. - The Second Circuit reversed in part: it held that injuries to property located in the U.S. may satisfy §1964(c)’s domestic‑injury requirement even if the owner is foreign, but laundering or transfers through U.S. accounts do not by themselves convert otherwise foreign injuries into domestic ones. ### Issues | Issue | Plaintiff's Argument | Defendant's Argument | Held | |---|---:|---:|---| | Whether RICO §1964(c) requires a domestic injury and how to locate that injury geographically | Bascuñán: district court erred relying solely on plaintiff's residence; injuries to property located in the U.S. are domestic | Elsaca: plaintiff's residence controls; a foreign plaintiff alleging an economic loss suffered abroad cannot state a domestic RICO injury | Court: §1964(c) requires a domestic injury but location depends on the specific injury alleged; analyze each distinct injury separately | | Whether misappropriation of funds held in a U.S. bank account is a domestic injury | Funds held in J.P. Morgan New York account were U.S.-located property and their theft is domestic | Transfers through U.S. financial system do not automatically create a domestic injury when the owner and underlying property are foreign | Held: misappropriation of property physically located in U.S. (e.g., a New York bank account) plausibly alleges a domestic injury | | Whether theft of bearer shares from a NY safety‑deposit box is a domestic injury | Bearer shares were physically in NY; their removal constitutes theft of tangible property in the U.S. | Defendant argued property belonged to foreign entities and plaintiff is foreign | Held: theft of bearer shares from a NY box plausibly alleges a domestic injury to tangible property located in the U.S. | | Whether laundering or moving stolen foreign assets through U.S. accounts converts otherwise foreign injuries into domestic ones | Bascuñán contended U.S. financial contacts support domestic injury findings | Elsaca argued that using U.S. accounts does not alter locus of injury | Held: use of U.S. bank accounts to launder or route funds is not, by itself, sufficient to transform a foreign injury into a domestic one | ### Key Cases Cited RJR Nabisco, Inc. v. European Community, 136 S. Ct. 2090 (2016) (held §1964(c) does not apply extraterritorially; plaintiffs must allege a domestic injury) H.J., Inc. v. Northwestern Bell Telephone Co., 492 U.S. 229 (1989) (definition of a RICO pattern and purpose of RICO) Agency Holding Corp. v. Malley‑Duff & Assocs., Inc., 483 U.S. 143 (1987) (civil RICO remedies are aimed at economic injuries) Morrison v. National Australia Bank Ltd., 561 U.S. 247 (2010) (presumption against extraterritoriality and its application to private causes of action) Shipping Corp. of India v. Jaldhi Overseas Pte Ltd., 585 F.3d 58 (2d Cir. 2009) (cautions about treating transient U.S. banking contacts as sufficient to confer domestic effects) Reiter v. Sonotone Corp., 442 U.S. 330 (1979) (recognition that money is property for legal purposes)