Sorota v. Sosa
842 F. Supp. 2d 1345
S.D. Fla.2012Background
- Sorota is a 91-year-old Florida resident who sues Sosa, a Peru resident, in Florida federal court.
- Amended Complaint asserts a RICO Count I alleging Sosa defrauded Sorota and misappropriated funds through elaborate schemes.
- Sosa allegedly formed Sparq and related Peru entities; he purportedly held majority or control interests to facilitate fraud.
- From 2007 to 2010 Sorota wired funds from Florida to Sparq in Peru, which Sosa used for personal purposes.
- Court evaluates extraterritoriality of RICO following Morrison; concludes Morrison controls and RICO does not apply extraterritorially; RICO claim dismissed with prejudice; remaining state-law claims dismissed without prejudice; case closed as to federal and state claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether RICO applies extraterritorially | Sorota argues RICO covers foreign enterprise. | Sosa contends RICO has no extraterritorial reach. | RICO does not apply extraterritorially. |
| Whether Sorota's RICO claim targets a domestic focus | Enterprise-related effects justify extraterritorial reach. | Enterprise and effects are foreign to the U.S. | Enterprise and impact entirely foreign; no extraterritorial application. |
| Whether dismissal with prejudice was proper and whether to exercise supplemental jurisdiction | N/A in opinion excerpt. | N/A in opinion excerpt. | RICO claim dismissed with prejudice; supplemental jurisdiction declined; other claims dismissed without prejudice. |
Key Cases Cited
- Morrison v. Nat’l Australia Bank Ltd., 130 S. Ct. 2869 (U.S. 2010) (presumption against extraterritoriality; no extraterritorial application without clear congressional intent)
- Norex Petroleum Ltd. v. Access Indus. Inc., 631 F.3d 29 (2d Cir. 2010) (rejects conduct/effects tests after Morrison)
- CGC Holding Co., LLC v. Hutchens, 824 F. Supp. 2d 1193 (D. Colo. 2011) (applies Morrison-like reasoning to RICO extraterritoriality)
- In re Toyota Motor Corp., 785 F. Supp. 2d 883 (C.D. Cal. 2011) (RICO extraterritoriality analysis post-Morrison)
- United States v. Philip Morris USA Inc., 783 F. Supp. 2d 23 (D.D.C. 2011) (post-Morrison extraterritorial reasoning for RICO)