640 F. App'x 56
2d Cir.2016Background
- Jus Punjabi LLC and Penny K. Sandhu appeal a SDNY dismissal of their amended complaint.
- Plaintiffs asserted civil RICO claims under 18 U.S.C. §1964(c) and a Lanham Act claim under 15 U.S.C. §1125(a).
- District Court dismissed for failure to plead a RICO pattern, lack of plausible predicate acts, and failure to state a Lanham Act claim.
- Alleged predicate acts included wire fraud, mail fraud, visa/permit/passport fraud, money laundering, and violations of 18 U.S.C. §§1956-1957.
- Court declined to exercise supplemental jurisdiction over state-law claims after federal claims were dismissed.
- The appellate court affirms the district court’s order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether RICO claims were properly dismissed for failure to plead predicate acts. | Punjabi alleged multiple predicate acts. | Defendants showed plaintiffs failed to plead the acts with particularity. | Yes; claims rejected for lack of plausible predicates. |
| Whether mail/wire fraud and visa/permit/passport fraud were pleaded with Rule 9(b) specificity. | Fraudulent conduct alleged in detail. | Allegations insufficiently pleaded with specificity. | Plaintiffs failed to plead with particularity under Rule 9(b). |
| Whether the RICO conspiracy claim was properly dismissed. | Conspiracy to commit RICO acts existed. | No plausible conspiracy to commit deficient RICO acts. | Yes; dismissed for lack of viable underlying predicates. |
| Whether the Lanham Act false advertising claim was properly dismissed. | Defendants made false statements harming plaintiffs. | Statements not plausibly disseminated or commercial speech. | Yes; dismissed for failure to plead commercial speech and dissemination. |
| Whether the district court properly declined supplemental jurisdiction over state-law claims. | State claims remain if federal claims survive. | Federal claims dismissed, so jurisdiction over state claims should not be exercised. | Yes; district court did not abuse discretion. |
Key Cases Cited
- GICC Capital Corp. v. Tech. Fin. Grp., Inc., 67 F.3d 463 (2d Cir. 1995) (necessity of showing a serious underlying predicate)
- First Capital Asset Mgmt., Inc. v. Satinwood, Inc., 385 F.3d 159 (2d Cir. 2004) (requirement to plead predicates with plausibility)
- Lundy v. Catholic Health Sys. of Long Island Inc., 711 F.3d 106 (2d Cir. 2013) (Rule 9(b) particularity for fraud claims)
- Cohen v. S.A.C. Trading Corp., 711 F.3d 353 (2d Cir. 2013) (pleading misrepresentations with time, place, speaker, content)
- Moore v. PaineWebber, Inc., 189 F.3d 165 (2d Cir. 1999) (fraud pleading standard under Rule 9(b))
- Caputo v. Pfizer, Inc., 267 F.3d 181 (2d Cir. 2001) (fraud intent and falsity standard for RICO predicates)
- United States v. Maher, 108 F.3d 1513 (2d Cir. 1997) (proceeds of unlawful activity concept under §1956)
- Fashion Boutique of Short Hills, Inc. v. Fendi USA, Inc., 314 F.3d 48 (2d Cir. 2002) (requirements for dissemination in Lanham Act false-advertising)
- Gmurzynska v. Hutton, 355 F.3d 206 (2d Cir. 2004) (definition of commercial speech for Lanham Act)
- Boule v. Hutton, 328 F.3d 84 (2d Cir. 2003) (standards for false advertising claims)