R.D. Mccullough, Ii v. Suter, 757 F.2d 142 (7th Cir. 1985). · Go Syfert
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R.D. Mccullough, Ii v. Suter, 757 F.2d 142 (7th Cir. 1985). Cases Citing This Book View Copy Cite
“if one-man band incorporates, it gets some legal protections from the corporate form, such as limited liability; and it is just this sort of legal shield for illegal activity that rico tries to pierce.”
190 citation events (56 in the last 25 years) across 37 distinct courts.
Strongest positive: Marshall v. Goguen (mtd, 2022-05-24)
Treatment trajectory · 1985 → 2026 · click a year to view as-of
1985 2005 2026
Top citers, strongest first. 50 distinct citers. How cited ↗
discussed Cited as authority (verbatim quote) Marshall v. Goguen
D. Mont. · 2022 · signal: see · quote attribution · 1 verbatim quote · confidence high
jou cannot associate with yourself, any more than you can conspire with yourself.
examined Cited as authority (verbatim quote) Jaguar Cars, Inc. v. Royal Oaks Motor Car Company, Inc. Theodore J. Forhecz, Sr. Mark M. Forhecz Theodore J. Forhecz, Jr. Richard Kirsh Jack Rusher Edward Zeller, Mark M. Forhecz, Jaguar Cars, Inc. v. Royal Oaks Motor Car Company, Inc. Theodore J. Forhecz, Sr. Mark M. Forhecz Theodore J. Forhecz, Jr. Richard Kirsh Jack Rusher Edward Zeller, Theodore J. Forhecz, Sr. (2×) also: Cited as authority (rule)
3rd Cir. · 1995 · quote attribution · 1 verbatim quote · confidence high
if one-man band incorporates, it gets some legal protections from the corporate form, such as limited liability; and it is just this sort of legal shield for illegal activity that rico tries to pierce.
discussed Cited as authority (rule) Sor v. TCF National Holdings, Inc.
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Hui v. Chojnacki
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Haynes v. Fairview Avenue Properties, LLC
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Said v. Chojnacki
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Michel v. Chojnacki
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Stafford v. Chojnacki
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Chen v. Chojnacki
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Shankar v. Fairview Avenue Properties LLC
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Abbas v. Mikosz
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Malik v. Prairie Raynor LLC
N.D. Ill. · 2023 · confidence medium
To satisfy RICO’s distinctness requirement, the enterprise can “be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization)” separate from the “person.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985); see also Cedric Kushner, 533 U.S. at 162–63 (“The corporate owner/employee, a natural person is distinct from the corporation itself, a legally different entity with different rights and responsibilities due to its different legal status.
discussed Cited as authority (rule) Sharif v. Newman
N.D. Ill. · 2022 · confidence medium
And because “you cannot associate with yourself,” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985), a RICO plaintiff must “identify a ‘person’—i.e., the defendant—that is distinct from the RICO enterprise” and allege that person “conducted or participated in the conduct of the ‘enterprise’s affairs’ not just [its] own affairs,” Walgreen, 719 F.3d at 853–54 (emphasis and alterations in original).
discussed Cited as authority (rule) Sharif v. Newman
N.D. Ill. · 2022 · confidence medium
And because “you cannot associate with yourself,” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985), a RICO plaintiff must “identify a ‘person’—i.e., the defendant—that is distinct from the RICO enterprise” and allege that person “conducted or participated in the conduct of the ‘enterprise’s affairs’ not just [its] own affairs,” Walgreen, 719 F.3d at 853–54 (emphasis and alterations in original).
discussed Cited as authority (rule) Calavan v. First Love International Ministries
N.D. Ill. · 2022 · confidence medium
And because “you cannot associate with yourself,” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985), a RICO plaintiff must “identify a ‘person’—i.e., the defendant—that is distinct from the RICO enterprise” and allege that person “conducted or participated in the conduct of the ‘enterprise’s affairs’ not just [its] own affairs,” Walgreen, 719 F.3d at 853–54 (emphasis and alterations in original).
discussed Cited as authority (rule) FOSTER v. DEMK, LLC
E.D. Pa. · 2019 · confidence medium
“The only important thing is that [the enterprise] be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization) separable from the individual.” Jaguar Cars, 46 F.3d at 269 (quoting McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985)).
discussed Cited as authority (rule) Oriska Insurance Company v. Avalon Gardens Rehabilitation & Health Care Center, LLC
N.D.N.Y. · 2019 · confidence medium
And as Judge Posner has explained, "[t]he only important thing is that [the RICO enterprise] be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in - 23 - the organization) separable from the individual." McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985).
discussed Cited as authority (rule) Roberts v. C.R. England, Inc. (2×) also: Cited "see, e.g."
D. Utah · 2017 · confidence medium
McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985) ("The only important thing is that it be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization) separable from the individual.”). .
discussed Cited as authority (rule) Kerik v. Tacopina
S.D.N.Y. · 2014 · confidence medium
Hemi Grp., LLC v. City of New York, 559 U.S. 1 , 130 S.Ct. 983 , 175 L.Ed.2d 943 (2010), the Second Circuit Court of Appeals held that even a sole proprietorship could be a RICO "enterprise” and satisfy the distinctness requirement, so long as the sole proprietorship is not "strictly a one-man show.” Id. at 448-49 (quoting and citing McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985)) (internal quotation marks omitted). .
discussed Cited as authority (rule) 4 K & D Corp. v. Concierge Auctions, LLC
S.D.N.Y. · 2014 · confidence medium
Hemi Grp., LLC v. City of New York, 559 U.S. 1 , 130 S.Ct. 983 , 175 L.Ed.2d 943 (2010), the Second Circuit Court of Appeals held that even a sole proprietorship could be a RICO “enterprise” and satisfy the distinctness requirement, so long as the sole proprietorship is not "strictly a one-man show.” Id. at 448-49 (quoting and citing McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985)) (internal quotation marks omitted). .
discussed Cited as authority (rule) Negrete v. Allianz Life Insurance Co. of North America (2×)
C.D. Cal. · 2013 · confidence medium
The Court cited with approval to McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985), which found that formal or practical separation would suffice to render an enterprise distinct from an individual.
discussed Cited as authority (rule) Sunlight Electrical Contracting Co. v. Turchi
E.D. Pa. · 2013 · confidence medium
Moreover, in Jaguar Cars the Court quoted Judge Posner with approval on this point, particularly his assessment that it “[t]he only important thing is that [the enterprise] be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization) separable from the individual.” Id. at 269 (quoting McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985)).
discussed Cited as authority (rule) Allstate Insurance v. St. Anthony's Spine & Joint Institute, P.C.
N.D. Ill. · 2010 · confidence medium
The Seventh Circuit has also held that sole proprietorships can be considered an enterprise as long as they have employees to distinguish them from the RICO “person.” See McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985) (“if [an individual or sole proprietorship] has employees or associates, the enterprise is distinct from him, and it then makes no difference, so far as we can see, what legal form the enterprise takes.
cited Cited as authority (rule) State v. Rivera
N.M. Ct. App. · 2009 · confidence medium
The State’s sole support for its contentions regarding Defendant’s wife is a case that is found in a footnote in the State’s brief, McCullough v. Suter, 757 F.2d 142, 143-44 (7th Cir.1985).
discussed Cited as authority (rule) Wade v. Gaither
D. Utah · 2009 · confidence medium
Similarly, in an opinion by Judge Richard Posner, the Seventh Circuit has stated that “a sole proprietorship can be an ‘enterprise’ with which the proprietor can be ‘associated.’ ” McCullough v. Suter, 757 F.2d 142, 143 (7th Cir.1985) (cited with approval in Cedric Kushner, 533 U.S. at 163 , 121 S.Ct. 2087 ).
discussed Cited as authority (rule) City of New York v. Smokes-Spirits. Com, Inc. (2×)
2d Cir. · 2008 · confidence medium
These circuits have held that a defendant is distinct from the sole proprietorship enterprise, unless the sole proprietor is “strictly a one-man show.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985) (“The only important thing is that [the enterprise] be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization) separable from the individual.”); United States v. Benny, 786 F.2d 1410, 1415-16 (9th Cir.) (affirming RICO conviction where defendant’s “sole proprietorship was a troupe, not a o…
discussed Cited as authority (rule) Schuster v. Anderson
N.D. Iowa · 2005 · confidence medium
As the Ninth Circuit noted in Feldman , this “is just the sort of legal shield for illegal activity that RICO tries to pierce.” Id. at 656 (citing McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985)).
cited Cited as authority (rule) Lockheed Martin Corp. v. Boeing Co.
M.D. Fla. · 2004 · confidence medium
McCullough, II v. Suter, 757 F.2d 142, 144 (7th Cir.1985).
discussed Cited as authority (rule) Ronald D. Smart, Doing Business as Paschall Electric v. International Brotherhood of Electrical Workers, Local 702 (2×)
7th Cir. · 2003 · confidence medium
Two plaintiffs are listed, but one is a sole proprietorship and the other the proprietor, so they are one, not two, in the eyes of the law (with an irrelevant exception for cases in which an individual is charged under RICO with using for nefarious ends an enterprise consisting of a sole proprietorship, McCullough v. Suter, 757 F.2d 142, 143-44 (7th Cir.1985)), and the one is the proprietor, Ronald Smart, not the proprietorship.
discussed Cited as authority (rule) Pizzo, Josephine v. Bekin Van Lines Co
7th Cir. · 2001 · confidence medium
The RICO claim fails, although the "enterprise" allegations are sufficient, Cedric Kushner Promotions, Ltd. v. King, 121 S.Ct. 2087 (U.S. 2001); McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985), and we’ll assume that the "racketeering" allegations are as well.
discussed Cited as authority (rule) Josephine Pizzo v. Bekin Van Lines Company
7th Cir. · 2001 · confidence medium
The RICO claim fails, although the “enterprise” allegations are sufficient, Cedric Kushner Promotions, Ltd. v. King, — U.S. —, 121 S.Ct. 2087 , 150 L.Ed.2d 198 (2001); McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985), and we’ll assume that the “racketeering” allegations are as well.
discussed Cited as authority (rule) Cedric Kushner Promotions, Ltd. v. King
SCOTUS · 2001 · signal: cf. · confidence medium
Cf. McCullough v. Suter, 757 F. 2d 142, 144 (CA7 1985) (finding either formal or practical separateness sufficient to be distinct under § 1962(c)).
discussed Cited as authority (rule) Donald Saucier v. Elliot M. Katz and in Defense of Animals
SCOTUS · 2001 · signal: cf. · confidence medium
Cf. McCullough v. Suter, 757 F.2d 142, 144 (CA7 1985) (finding either formal or practical separateness sufficient to be distinct under 1962(c)). 8 Linguistically speaking, an employee who conducts the affairs of a corporation through illegal acts comes within the terms of a statute that forbids any "person" unlawfully to conduct an "enterprise," particularly when the statute explicitly defines "person" to include "any individual ... capable of holding a legal or beneficial interest in property," and defines "enterprise" to include a "corporation." 18 U.S.C. 1961(3), (4).
examined Cited as authority (rule) Emcore Corp. v. PRICEWATERHOUSECOOPERS LLP (3×) also: Cited "see"
D.N.J. · 2000 · confidence medium
Tellingly, the Jaguar Court quoted Seventh Circuit Judge Posner’s observation in McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985): “The only important thing is that it [the enterprise] be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization) separable from the individual.” Id. at 269 (permitting claim against individual defendant whose sole proprietorship was named as enterprise).
discussed Cited as authority (rule) Molloy v. Primus Automotive Financial Services
C.D. Cal. · 2000 · confidence medium
The reason for this “distinctness” requirement is that “logic alone dictates that one entity may not serve [both] as the enterprise and the person associated with it because ... ‘you cannot associate with yourself.’ ” Yellow Bus Lines, Inc. v. Local Union 639, 883 F.2d 132 , 139 (D.C.Cir.1989) (quoting McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985)).
discussed Cited as authority (rule) Williams v. Ford Motor Co.
N.D. Ill. · 1998 · confidence medium
Indeed, the court has said that “[t]he only important thing is that [the enterprise] be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization) separable from the individual.” McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985).
discussed Cited as authority (rule) Emery v. American General Finance, Inc.
7th Cir. · 1998 · confidence medium
The Third Circuit, relying in part on our decision in McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985), has held that an allegation that corporate officers or employees are using their corporation to perpetrate the frauds or other predicate acts satisfies the "conduct the affairs through" requirement.
discussed Cited as authority (rule) Emery v. American General Finance, Inc.
7th Cir. · 1998 · confidence medium
The Third Circuit, relying in part on our decision in McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985), has held that an allegation that corporate officers or employees are using their corporation to perpetrate the frauds or other predicate acts satisfies the "conduct the affairs through" requirement.
discussed Cited as authority (rule) Rajiv Khurana v. Innovative Health Care Systems, Inc. Karry Teel Carl Holden William Malone I.H.S. River Region Hospital of Vacherie, La., Inc.
5th Cir. · 1997 · confidence medium
See Jaguar Cars, Inc. v. Royal Oaks Motor Car Co., 46 F.3d 258, 266-269 (3d Cir.1995); United States v. Robinson, 8 F.3d 398, 407 (7th Cir.1993); Sever v. Alaska Pulp Corp., 978 F.2d 1529, 1534 (9th Cir.1992); Ashland Oil, Inc. v. Arnett, 875 F.2d 1271, 1280 (7th Cir.1989); McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985); see also Securitron, 65 F.3d at 263 .
examined Cited as authority (rule) State v. Hutchings (3×) also: Cited "see"
Utah Ct. App. · 1997 · confidence medium
There, a section 1962(c) count was brought against a defendant whose sole proprietorship was also the RICO “enterprise” with which the government argued the defendant, as proprietor, “associated.” Id. at 143; see generally 18 U.S.C.A. § 1962 (e) (West 1995).
cited Cited as authority (rule) Eagle Traffic Control, Inc. v. James Julian, Inc.
E.D. Pa. · 1996 · confidence medium
McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985).
discussed Cited as authority (rule) United States v. London
1st Cir. · 1995 · confidence medium
The only important thing is that it be either formally (as when there is incorporation) or practically (as when there are people besides the proprietor working in the organization) separable from the individual. 107 McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985). 108 We therefore reject London's argument that he and the RICO enterprise alleged in the indictment are legally indistinguishable. 109 3.
discussed Cited as authority (rule) United States v. London
1st Cir. · 1995 · confidence medium
McCullough v. Suter, 757 F.2d 142, 144 (7th Cir. 1985). __________ _____ We therefore reject London's argument that he and the RICO enterprise alleged in the indictment are legally indistinguishable. -48- 48 3.
discussed Cited as authority (rule) United States v. London (2×)
1st Cir. · 1995 · confidence medium
McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985).
discussed Cited as authority (rule) Whaley v. Auto Club Ins. Ass'n
E.D. Mich. · 1995 · confidence medium
See Puckett v. Tennessee Eastman Co., 889 F.2d 1481, 1489 (6th Cir.1989); McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985) (holding that there has to be a distinction between the defendant and enterprise, because "a person cannot logically associate with himself"); Haroco v. American Nat.
discussed Cited as authority (rule) Richmond v. Nationwide Cassel
7th Cir. · 1995 · confidence medium
See United States v. Robinson, 8 F.3d 398, 407 (7th Cir.1993) (determining that the president and controlling shareholder of the corporation-enterprise was a separate and distinct entity from that enterprise); Ashland Oil, Inc. v. Arnett, 875 F.2d 1271, 1280 (7th Cir.1989) (determining that the defendants, owners of Arnett Oil, were sufficiently distinct from their incorporated business to be treated as separate entities); McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985) (holding that an unincorporated sole proprietorship is a distinct enterprise from its owner when it employs several ind…
discussed Cited as authority (rule) Richmond v. Nationwide Cassel L.P.
7th Cir. · 1995 · confidence medium
See United States v. Robinson, 8 F.3d 398, 407 (7th Cir.1993) (determining that the president and controlling shareholder of the corporation-enterprise was a separate and distinct entity from that enterprise); Ashland Oil, Inc. v. Arnett, 875 F.2d 1271, 1280 (7th Cir.1989) (determining that the defendants, owners of Arnett Oil, were sufficiently distinct from their incorporated business to be treated as separate entities); McCullough v. Suter, 757 F.2d 142,144 (7th Cir.1985) (holding that an unincorporated sole proprietorship is a distinct enterprise from its owner when it employs several indi…
discussed Cited as authority (rule) Jaguar Cars, Inc. v. Royal Oaks Motor Car Co.
3rd Cir. · 1995 · confidence medium
In reaching its conclusion, the Robinson panel relied on an earlier opinion by then Judge Posner in McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985), which held that an unincorporated sole proprietorship was a *269 distinct enterprise from its owner because it employed several individuals.
discussed Cited as authority (rule) Florian Sever v. Alaska Pulp Corporation Dennis Huse George Woodbury Jesse Cline Frank Roppel George Ishiyama Wayne Funk Ralph Fenner, Florian Sever v. Alaska Pulp Corporation Dennis Huse George Woodbury Jesse Cline Frank Roppel George Ishiyama Wayne Funk Ralph Fenner (2×)
9th Cir. · 1992 · confidence medium
As we observed then, " 'the only important thing is that [the enterprise] be either formally (as when there is a corporation) or practically (as when there are other people beside the proprietor working in the organization) separable from the individual.' " Benny, 786 F.2d at 1416 (quoting McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985)). 2 16 This decision makes it clear that the inability of a corporation to operate except through its officers is not an impediment to section 1962(c) suits.
discussed Cited as authority (rule) Sever v. Alaska Pulp Corp. (2×)
9th Cir. · 1992 · confidence medium
As we observed then, “ ‘the only important thing is that [the enterprise] be either formally (as when there is a corporation) or practically (as when there are other people beside the proprietor working in the organization) separable from the individual.' ” Benny, 786 F.2d at 1416 (quoting McCullough v. Suter, 757 F.2d 142, 144 (7th Cir.1985)). 2 This decision makes it clear that the inability of a corporation to operate except through its officers is not an impediment to section 1962(c) suits.
Retrieving the full opinion text from the archive…
R.D. McCullough Ii, and Utica National Bank, as Trustee of the R.D. McCullough Ii, Self Employed Retirement Plan
v.
Richard W. Suter, D/B/A National Investment Publishing Company
84-1516.
Court of Appeals for the Seventh Circuit.
Mar 13, 1985.
757 F.2d 142
Cited by 2 opinions  |  Published

757 F.2d 142

53 USLW 2474

R.D. McCULLOUGH, II, and Utica National Bank, as trustee of
the R.D. McCullough, II, Self Employed Retirement
Plan, Plaintiffs-Appellees,
v.
Richard W. SUTER, d/b/a National Investment Publishing
Company, Defendant-Appellant.

No. 84-1516.

United States Court of Appeals,
Seventh Circuit.

Argued Jan. 29, 1985.
Decided March 13, 1985.

Gordon J. Arnett, Chicago, Ill., for defendant-appellant.

Charles L. Glick, Burke, Bosselman, Freivogel, Weaver, Glaves & Ryan, Chicago, Ill., for plaintiffs-appellees.

Before CUDAHY, POSNER, and FLAUM, Circuit Judges.

POSNER, Circuit Judge.

[*~142]1

The question for decision--one of first impression so far as we are able to determine--is whether a sole proprietorship can be an "enterprise" with which its proprietor can be "associated" within the meaning of a provision of the Racketeer Influenced and Corrupt Organizations Act (Title IX of the Organized Crime Control Act of 1970), 18 U.S.C. Sec. 1962(c), which makes it "unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt." There are no cases on the question and no pertinent legislative history.

2

Richard Suter, who under the name of the National Investment Publishing Company advises people about investments and buys coins for investment on their behalf, received $23,000 from the Utica National Bank to buy coins for R.D. McCullough's self-employed retirement account, which the bank manages. Suter represented that he used the money to buy coins, but he sent only three coins, together worth less than $10,000, to the bank, and the bank and McCullough brought this suit. Later Suter pleaded guilty to two counts of having used the mails to defraud coin investors such as the bank and McCullough, in violation of the federal mail-fraud statute. After a bench trial, the district court in this case found that Suter had defrauded the plaintiffs of $14,000, and awarded them treble their damages, plus attorney's fees, under the civil damages provision of the RICO statute, 18 U.S.C. Sec. 1964(c).

[*~143]3

There is no question that Suter's fraudulent activity constituted a pattern of racketeering activity as that term is defined in the statute, or that Suter conducted the affairs of the National Investment Publishing Company through this pattern, or that this conduct caused the injury to the plaintiffs of which they complain. Hence they are entitled to recover damages under the RICO statute provided that a sole proprietorship can be an "enterprise" with which the proprietor can be "associated." We think it can be. The statute provides that " 'enterprise' includes any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity." 18 U.S.C. Sec. 1961(4). A sole proprietorship is a recognized legal entity, and, provided it has any employees, is in any event a "group of individuals associated in fact." Since it is obvious from the name of the statute ("... and Corrupt Organizations") that the enterprises to which the statute refers include criminal enterprises, and not just legitimate enterprises penetrated or looted by criminals, it would be passing strange to exclude proprietorships. After all, we do not suppose that "Murder Inc." was really a corporation; and we cannot believe that Congress would have wanted gangsters to be able to escape the clutches of section 1962(c) just by avoiding the corporate form, the partnership, or other forms of association named explicitly in section 1961(4)--especially in light of the last part of subsection (4) ("... and any union or group of individuals associated in fact although not a legal entity").

[*~144]4

There would be a problem if the sole proprietorship were strictly a one-man show. If Suter had no employees or other associates and simply did business under the name of the National Investment Publishing Company, it could hardly be said that he was associating with an enterprise called the National Investment Publishing Company; you cannot associate with yourself, any more than you can conspire with yourself, just by giving yourself a nom de guerre. We therefore held in Haroco, Inc. v. American National Bank & Trust Co., 747 F.2d 384, 399-402 (7th Cir.1984), cert. granted, --- U.S. ----, 105 S.Ct. 902, 83 L.Ed.2d 917 (1985), that an enterprise (a national banking association in that case) could not associate with itself for purposes of section 1962(c). But Suter had several people working for him; this made his company an enterprise, and not just a one-man band; and all section 1962(c) requires, as we said in Haroco, is "some separate and distinct existence for the person [Suter] and the enterprise [National Investment Publishing Company]," 747 F.2d at 402.

[*~144]5

It is true that if Suter were all by himself, and yet adopted the corporate form for his activity, he might well fall under section 1962(c), for the corporation would be an enterprise within the meaning of section 1961(4). And from this it could be argued that since subsection (4) defines enterprise so broadly, even a sole proprietorship is an enterprise and Suter is therefore caught by section 1962(c)--thus showing the absurdity of ever treating a sole proprietorship as an enterprise. But these cases are different. If the one-man band incorporates, it gets some legal protections from the corporate form, such as limited liability; and it is just this sort of legal shield for illegal activity that RICO tries to pierce. A one-man band that does not incorporate, that merely operates as a proprietorship, gains no legal protections from the form in which it has chosen to do business; the man and the proprietorship really are the same entity in law and fact. But if the man has employees or associates, the enterprise is distinct from him, and it then makes no difference, so far as we can see, what legal form the enterprise takes. The only important thing is that it be either formally (as when there is incorporation) or practically (as when there are other people besides the proprietor working in the organization) separable from the individual.

[*~143]6

The other issues raised by Suter on this appeal have no possible merit. The judgment for the plaintiffs is

7

AFFIRMED.