97-11279 | 5th Cir. | Jul 30, 1998
147 F.3d 438" date_filed="1998-07-30" court="5th Cir." case_name="Rotella v. Wood">147 F.3d 438
RICO Bus.Disp.Guide 9528
Mark ROTELLA, Plaintiff-Appellant,
v.
Angela M. WOOD, MD, et al., Defendants,
Angela M. Wood, MD; Gary Lee Etter, MD PA; William M.
Pederson, MD; Grover Lawlis, MD; David R. Baker, MD;
Larrie W. Arnold, MD; Fred L. Griffin, MD; Leslie H.
Secrest, MD; John M. Zimburean, MD; Bradford M. Goff, MD;
Dallas Psychiatric Associates; David R. Baker, MD PA;
Larrie W. Arnold, MD PA; Leslie H. Secrest, MD PA; William
M. Pederson, MD PA; Fred L. Griffin, MD PA; Bradford M.
Goff, MD PA; Grover Lawlis, MD PA; Angela M. Wood, MD PA;
John M. Zimburean, MD PA; Gary Lee Etter, MD, Defendants-Appellees.
No. 97-11279
Summary Calendar.
United States Court of Appeals,
Fifth Circuit.
July 30, 1998.
Kevin Hampton Dubose, Richard Phillips Hogan, Jr., Holman, Hogan, Dubose & Townsend, Richard Warren Mithoff, Mithoff & Jacks, Houston, TX, Robert Franklin Andrews, Andrews & Cirkiel, Fort Worth, TX, for Rotella.
Debora M. Alsup, Julie Caruthers Parsley, Thompson & Knight, Austin, TX, Jane Politz Brandt, John H. Martin, Thompson & Knight, Dallas, TX, for Wood and Etter.
Tom B. Renfro, Joseph F. Cleveland, McLean & Sanders, Fort Worth, TX, for Pederson, Baker, Arnold, Griffin, Secrest, Zimburean, Goff and Dallas Psychiatric Associates.
Charles T. Frazier, Jr., Andrea M. Kuntzman, Gregory Joseph Lensing, Cowles & Thompson, Dallas, TX, for Lawlis.
Appeal from the United States District Court for the Northern District of Texas.
Before REYNALDO G. GARZA, SMITH and BENAVIDES, Circuit Judges.
REYNALDO G. GARZA, Circuit Judge:
Mark Rotella sued a group of doctors and their related business entities under the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. §§ 1961-68, for improperly conspiring to admit, treat, and retain him at Brookhaven Psychiatric Pavilion for reasons related to their own financial interests rather than the patient's psychiatric condition. The defendants moved for summary judgment based on the statute of limitations. United States District Judge John McBryde granted all motions for summary judgment, finding that Rotella's RICO cause of action accrued when he discovered his injury more than four years before he brought this action. See Agency Holding Corp. v. Malley-Duff & Assocs., 483 U.S. 143" date_filed="1987-06-22" court="SCOTUS" case_name="Agency Holding Corp. v. Malley-Duff & Associates, Inc.">483 U.S. 143, 156, 107 S.Ct. 2759, 97 L.Ed.2d 121 (1987) (holding that civil RICO claims are subject to a four-year statute of limitations). Rotella brought this appeal from the district court's ruling, arguing that, for limitations purposes, a RICO cause of action does not accrue until a plaintiff discovers both the injury and the pattern of racketeering activity. Having reviewed the briefs, the summary judgment evidence, and the district court's opinion, we find that Judge McBryde applied the correct rule of law and, therefore, we affirm.
Last year, the Supreme Court acknowledged, but declined to resolve, the split among the circuits regarding whether a RICO cause of action accrues upon the discovery of the injury alone, or upon the discovery of both the injury and the pattern of racketeering activity. Klehr v. A.O. Smith Corp., 521 U.S. 179" date_filed="1997-06-19" court="SCOTUS" case_name="Klehr v. A. O. Smith Corp.">521 U.S. 179, 117 S.Ct. 1984, 1989, 138 L.Ed.2d 373, 384 (1997). The Court struck down only the Third Circuit's approach, which required discovery of the last predicate act for accrual of a RICO cause of action. Id. at 1988, 138 L. Ed. 2d 373" date_filed="1997-06-19" court="SCOTUS" case_name="Klehr v. A. O. Smith Corp.">138 L.Ed.2d at 381. As such, Klehr does not dictate our choice between the injury discovery rule and the injury-pattern discovery rule.
As this circuit has not expressly endorsed either approach in a published opinion, we take this opportunity to join the First, Second, Fourth, Seventh, and Ninth Circuits in holding that a RICO cause of action accrues upon the discovery of the injury in question. See Grimmett v. Brown, 75 F.3d 506" date_filed="1996-01-26" court="9th Cir." case_name="Tom Grimmett v. Patricia Brown Patricia Brown">75 F.3d 506, 511 (9th Cir.1996), cert. dism'd as improvidently granted, 519 U.S. 233" date_filed="1997-01-14" court="SCOTUS" case_name="Grimmett v. Brown">519 U.S. 233, 117 S.Ct. 759, 136 L.Ed.2d 674 (1997); McCool v. Strata Oil Co., 972 F.2d 1452" date_filed="1992-10-26" court="7th Cir." case_name="Daniel Mccool John Pellettiere v. Strata Oil Company">972 F.2d 1452, 1464-1465 (7th Cir.1992); Rodriguez v. Banco Central, 917 F.2d 664" date_filed="1990-10-30" court="1st Cir." case_name="Raul F. Rodriguez v. Banco Central, Raul Rodriguez Rodriguez v. Banco Central Corporation, Raul F. Rodriguez v. Banco Central">917 F.2d 664, 665-666 (1st Cir.1990); Bankers Trust Co. v. Rhoades, 859 F.2d 1096" date_filed="1988-10-03" court="2d Cir." case_name="Bankers Trust Company v. Daniel Rhoades, Herman Soifer and Milton Braten">859 F.2d 1096, 1102 (2d Cir.1988), cert. denied, 490 U.S. 1007" date_filed="1989-04-03" court="SCOTUS" case_name="Lowery v. Lowery">490 U.S. 1007, 109 S. Ct. 1642" date_filed="1989-04-03" court="SCOTUS" case_name="Gekas v. Pipin">109 S.Ct. 1642, 1643, 104 L. Ed. 2d 158" date_filed="1989-04-03" court="SCOTUS" case_name="Constant v. Advanced Micro-Devices, Inc.">104 L.Ed.2d 158 (1989); Pocahontas Supreme Coal Co. v. Bethlehem Steel Corp., 828 F.2d 211" date_filed="1987-10-22" court="4th Cir." case_name="Pocahontas Supreme Coal Company Inc. Edward Borg v. Bethlehem Steel Corporation">828 F.2d 211, 220 (4th Cir.1987); see also Riddell v. Riddell Washington Corp., 866 F.2d 1480" date_filed="1989-02-03" court="D.C. Cir." case_name="Roland Riddell v. Riddell Washington Corporation">866 F.2d 1480, 1489-1490 (D.C.Cir.1989) (assuming, but not deciding, that injury discovery rule applies). We must so hold in order to remain consistent with several of our prior unpublished decisions. Furthermore, this approach is also consistent with our published precedent related to the question.
We have recently adopted the injury discovery rule in a string of unpublished decisions. In Schwertz v. Zimburean, No. 96-11155, 121 F.3d 703" date_filed="1997-07-07" court="5th Cir." case_name="Callaway v. Natl Convnce Stores">121 F.3d 703 (5th Cir. July 25, 1997) and Cain v. Lawlis, No. 96-11238, 121 F.3d 704" date_filed="1997-07-16" court="5th Cir." case_name="United States v. Riojas">121 F.3d 704 (5th Cir. July 15, 1997), we affirmed the district court's application of the injury discovery rule. Schwertz relied on Cain and on another recent unpublished decision, Mitchell v. Bolan, No. 96-11168, 120 F.3d 266" date_filed="1997-07-03" court="5th Cir." case_name="Carverdale Commty v. Johnson">120 F.3d 266 (5th Cir.1997). Cain relied on Schwertz and also on Mitchell. Mitchell, in turn, affirmed a summary judgment on RICO claims for statute of limitation purposes "for essentially the reasons stated by the district court in its memorandum order." The district court in Mitchell expressly adopted the injury discovery rule. Mitchell v. Bolan, No. 4:95-CV-528-A (N.D.Tex. July 2, 1996) (McBryde, J.). Judge McBryde cited cases from the First, Second, Fourth, Seventh, and Ninth Circuits, and noted that he was "particularly impressed" with the reasoning employed by the First and Second Circuits in Rodriguez and Bankers Trust. Mitchell, No. 4:95-CV-528-A, slip op. at 10-11.
Contrary to Rotella's argument, our holding today does not conflict with our decisions in Daboub v. Gibbons, 42 F.3d 285" date_filed="1995-01-12" court="5th Cir." case_name="Daboub v. Gibbons">42 F.3d 285 (5th Cir.1995) and La Porte Const. Co. v. Bayshore Nat'l Bank, 805 F.2d 1254" date_filed="1986-12-17" court="5th Cir." case_name="La Porte Construction Company, Inc. And Floyd G. Dicus v. Bayshore National Bank of La Porte, Texas, and Arthur Andersen & Co.">805 F.2d 1254 (5th Cir.1986). Although La Porte mentions accrual upon discovery of "the fraud," 805 F.2d 1254" date_filed="1986-12-17" court="5th Cir." case_name="La Porte Construction Company, Inc. And Floyd G. Dicus v. Bayshore National Bank of La Porte, Texas, and Arthur Andersen & Co.">805 F.2d at 1256, and Daboub speaks in terms of the defendant's conduct, 42 F.3d 285" date_filed="1995-01-12" court="5th Cir." case_name="Daboub v. Gibbons">42 F.3d at 291, neither case mentions or even implies a requirement of discovery of a pattern of racketeering activity with regard to the accrual of a civil RICO cause of action. As such, these cases are fully consistent with our adoption of the injury discovery rule of accrual for civil RICO actions.
Accordingly, we hold that Judge McBryde applied the correct rule of accrual in granting summary judgment based on the expiration of the statute of limitations. In so holding, we place the Fifth Circuit on record as in line with the First, Second, Fourth, Seventh, and Ninth Circuits' choice of the injury discovery rule of accrual for civil RICO causes of action. As such, we affirm the district court's decision below.
AFFIRMED.