Valentina Sheshtawy v. Conservative Club of, 697 F. App'x 380

Plaintiffs (seven individuals involved in three unrelated probate disputes) sued multiple defendants connected to Harris County Probate Court No. 1, alleging a RICO conspiracy, common-law fraud, and breach of fiduciary duty based on a scheme to “take over” the probate court and enrich defendants.
The district court dismissed the federal RICO claims under Fed. R. Civ. P. 12(b)(1) and 12(b)(6) and declined to exercise jurisdiction over the related state-law claims (dismissed without prejudice).
The district court also imposed Rule 11 and inherent‑power sanctions against several plaintiffs and against their attorneys; plaintiffs appealed the dismissals and the sanctions against themselves (but not the sanctions against counsel, who were not parties to the appeal).
On review, the Fifth Circuit considered standing, pleading particularity under RICO, and whether the district court abused its discretion in imposing sanctions.
The Fifth Circuit affirmed: plaintiffs lacked RICO standing because they failed to allege a direct, concrete, particularized, and proximate injury (their asserted expectancy interests in probate distributions were too speculative); the court also upheld the sanctions as not an abuse of discretion.

Issue	Plaintiff's Argument	Defendant's Argument	Held
RICO standing	Plaintiffs alleged financial harm from defendants’ scheme to control probate outcomes	Defendants argued plaintiffs alleged only speculative expectancy interests and no direct, concrete injury	Held: Plaintiffs lack standing—no direct, concrete, particularized, proximate injury alleged
RICO pleading particularity	Complaint (246 pages) sufficiently alleges enterprise, pattern, and racketeering with factual detail	Complaint is conclusory, repetitious, lacks factual specificity required for RICO	Held: Court affirmed dismissal; would also affirm for failure to plead RICO with required particularity
Sanctions under Rule 11 and inherent power	Sanctions were unwarranted / punitive	District court argued filings were improper, meant to multiply proceedings and escalate costs; conduct showed bad faith	Held: Sanctions affirmed—district court did not abuse its discretion
Appealability of sanctions against counsel	Plaintiffs attempted to challenge counsel sanctions on appeal	Defendants argued appeal did not include counsel (not parties to Notice of Appeal)	Held: Fifth Circuit lacks jurisdiction to review sanctions against counsel because they were not parties to the appeal

Lujan v. Defs. of Wildlife, 504 U.S. 555 (standing requires injury that is concrete, particularized, and actual or imminent)
In re Taxable Mun. Bond Sec. Litig., 51 F.3d 518 (5th Cir. 1995) (RICO standing requires proximate, concrete injury; expectancy interests are speculative)
Gil Ramirez Grp., L.L.C. v. Hous. Indep. Sch. Dist., 786 F.3d 400 (5th Cir. 2015) (distinguishing direct harm from speculative beneficiary interests)
Firestone v. Galbreath, 976 F.2d 279 (6th Cir. 1992) (estate, not potential beneficiaries, suffers direct harm for RICO standing purposes)
Elliott v. Foufas, 867 F.2d 877 (5th Cir. 1989) (RICO elements are terms of art requiring particularity)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (pleading standards require more than conclusory recitals)
FDIC v. Maxxam, Inc., 523 F.3d 566 (5th Cir. 2008) (sanctions review: abuse of discretion standard)
Willy v. Coastal Corp., 503 U.S. 131 (court retains authority to award sanctions even after dismissal)
Kingsley v. Lakeview Regional Med. Ctr., LLC, 570 F.3d 586 (5th Cir. 2009) (appellate jurisdiction limits regarding who may appeal sanctions)
Carmon v. Lubrizol, 17 F.3d 791 (5th Cir. 1994) (standards for imposing Rule 11 sanctions)