Lipin Enter. Inc. v. Goldie W. Lee, 803 F.2d 322 (1st Cir. 1986). · Go Syfert
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Lipin Enter. Inc. v. Goldie W. Lee, 803 F.2d 322 (1st Cir. 1986). Cases Citing This Book View Copy Cite
“here must be some indication of a 'threat of continuing activity' by the defendants, not just one instance of fraud with a single victim”
221 citation events (29 in the last 25 years) across 25 distinct courts.
Strongest positive: Potbelly Sandwich Works, LLC v. Montalto (ilnd, 2020-08-17)
Treatment trajectory · 1986 → 2026 · click a year to view as-of
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Top citers, strongest first. 50 distinct citers.
discussed Cited as authority (verbatim quote) Potbelly Sandwich Works, LLC v. Montalto
N.D. Ill. · 2020 · quote attribution · 1 verbatim quote · confidence high
there must be some indication of a threat of continuing activity by the defendants, not just one instance of fraud with a single victim.
discussed Cited as authority (verbatim quote) ca4 1988 (2×) also: Cited as authority (rule)
4th Cir. · 1988 · signal: see also · quote attribution · 1 verbatim quote · confidence high
here must be some indication of a 'threat of continuing activity' by the defendants, not just one instance of fraud with a single victim
cited Cited as authority (rule) Skycoin Global Foundation Limited v. Stephens
N.D. Ill. · 2023 · confidence medium
Inc. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
cited Cited as authority (rule) Turow v. Glazier
N.D. Ill. · 2022 · confidence medium
Inc. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
discussed Cited as authority (rule) Crete Carrier Corp. v. Sullivan & Sons, Inc.
D. Maryland · 2022 · confidence medium
Therefore, “[t]he pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes.” Lipin Enters. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
cited Cited as authority (rule) HORTON v. LEASINGDESK SCREENING
S.D. Ind. · 2021 · confidence medium
Id. (citing Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986)).
discussed Cited as authority (rule) Dye v. MLD Mortgage, Inc.
D. Maryland · 2021 · confidence medium
Therefore, “[t]he pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes.” Lipin Enters. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
discussed Cited as authority (rule) Ekstrom v. Congressional Bank
D. Maryland · 2020 · confidence medium
Therefore, “[t]he pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes.” Lipin Enters. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
discussed Cited as authority (rule) Donaldson v. Primary Residential Mortgage, Inc.
D. Maryland · 2020 · confidence medium
Therefore, “[t]he pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes.” Lipin Enters. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
cited Cited as authority (rule) Sciarrone v. Amrich
N.D. Ill. · 2020 · confidence medium
Inc. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
discussed Cited as authority (rule) Sizer v. Oshinnaiye
D. Maryland · 2020 · confidence medium
Therefore, “[t]he pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes.” Lipin Enters. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986).
discussed Cited as authority (rule) Menzies v. Seyfarth Shaw LLP
N.D. Ill. · 2016 · confidence medium
Lipin Enterprises Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986); see also Midwest Grinding, 976 F.2d at 1024-25 (finding that, given the nature of the scheme, the mere multiplicity of mail and wire fraud acts by itself “may be no indication of the requisite continuity of the underlying fraudulent activity”) (internal quotations omitted); Jennings, 495 F.3d at 475 (same); Vicom, 20 F.3d at 781 (same).
discussed Cited as authority (rule) Drobny v. JP Morgan Chase Bank, NA
N.D. Ill. · 2013 · confidence medium
Slaney, 244 F.3d at 599 (7th Cir.2001); Ashland Oil, Inc. v. Arnett, 875 F.2d 1271, 1278-79 (7th Cir.1989); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986) (multiple acts of mail fraud in furtherance of a single episode of fraud involving one victim and relating to one basic transaction cannot constitute the necessary pattern).
discussed Cited as authority (rule) Holding v. Cook
C.D. Ill. · 2007 · confidence medium
Elliott v. Chicago Motor Club Ins., 809 F.2d 347, 350 (7th Cir.1986)(several acts of mail fraud over period of years did not state RICO claim where all the acts were related to settling one insurance claim arising from one accident), quoting Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986)(12 separate acts of mail fraud did not make RICO pattern, where acts related to one sale to one person). “[A] single fraudulent scheme with only one injury to one victim ... [is] not a ‘pattern of racketeering activity’ under Section 1962(c) simply because it required several acts of ma…
discussed Cited as authority (rule) Daniels v. Bursey
N.D. Ill. · 2004 · confidence medium
As for the number of predicate acts, the Seventh Circuit has said that multiple acts of mail or wire fraud do not necessarily form a pattern because “[m]ail and wire fraud are perhaps unique among the various sorts of ‘racketeering activity’ possible under RICO in that the existence of a multiplicity of predicate acts ... may be no indication of the requisite continuity of the underlying fraudulent activity.’ ” Id. at 781 (quoting Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 325 (7th Cir.1986) (Cudahy, J., concurring)).
discussed Cited as authority (rule) Mary Decker Slaney v. The International Amateur Athletic Federation and the United States Olympic Committee (2×) also: Cited "see"
7th Cir. · 2001 · confidence medium
In Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986), we held that a single fraudulent scheme with only one injury to one victim was not a “pattern of racketeering activity” under § 1962(c) simply because it required several acts of mail and wire fraud to inflict the single injury.
discussed Cited as authority (rule) Slaney, Mary D. v. Int'l Amateur (2×) also: Cited "see"
7th Cir. · 2001 · confidence medium
In Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir. 1986), we held that a single fraudulent scheme with only one injury to one victim was not a "pattern of racketeering activity" under sec. 1962(c) simply because it required several acts of mail and wire fraud to inflict the single injury.
discussed Cited as authority (rule) Gagan v. American Cablevision
7th Cir. · 1996 · confidence medium
In Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986), the plaintiffs alleged a fraudulent acquisition of stock amounted to a RICO violation because it entailed a multitude of fraudulent statements and representations transmitted through the mails and wires.
discussed Cited as authority (rule) Gagan v. American Cablevision, Inc.
7th Cir. · 1996 · confidence medium
In Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986), the plaintiffs alleged a fraudulent acquisition of stock amounted to a RICO violation because it entailed a multitude of fraudulent statements and representations transmitted through the mails and wires.
discussed Cited as authority (rule) Vicom, Inc. v. Harbridge Merchant Services, Inc., as Successor in Interest to Peach Tree Bancard Corporation, Judy Elliot, James Elliot (2×)
7th Cir. · 1994 · confidence medium
Id. at 325 (Cudahy, J., concurring); see also Hartz, 919 F.2d at 473 (quoting Lipin remark); United States Textiles, 911 F.2d at 1268 (same); Sutherland v. O'Malley, 882 F.2d 1196 , 1205 n. 8 (7th Cir.1989) (same); Ashland Oil, Inc. v. Arnett, 875 F.2d 1271, 1278 (7th Cir.1989) (stating that the “number of [mail and wire fraud] offenses is only tangentially related to the underlying fraud, and can be a matter of happenstance”).
discussed Cited as authority (rule) Trans World Airlines, Inc. v. Berger
E.D. Mo. · 1994 · confidence medium
See, e.g., Menasco, Inc. v. Wasserman, 886 F.2d 681 , 684 (4th Cir.1989); Torwest DBC, Inc. v. Dick, 810 F.2d 925 , 928-29 (10th Cir.1987); Medallion Television Enterprises, Inc. v. SelecTV of California, Inc., 833 F.2d 1360, 1362-64 (9th Cir.1987); Jones v. Lampe, 845 F.2d 755, 757-58 (7th Cir. 1988); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323-24 (7th Cir.1986); Roeder v. Alpha Industries, Inc., 814 F.2d 22, 30-31 (1st Cir.1987).
discussed Cited as authority (rule) Riley v. Murdock
E.D.N.C. · 1993 · confidence medium
Basically, “[t]he pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendants as [persons] who regularly commit[ ] such crimes.” Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986).
discussed Cited as authority (rule) Professionals, Inc. v. Berry
3rd Cir. · 1991 · confidence medium
As the Seventh Circuit stated in Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986), "[t]he pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes.
cited Cited as authority (rule) Hartz v. Friedman
7th Cir. · 1990 · confidence medium
Id. at 325 (Cudahy, J., concurring).
discussed Cited as authority (rule) Hartz v. Friedman
7th Cir. · 1990 · confidence medium
In Lipin Enterprises Inc. v. Lee, 803 F.2d 322 (7th Cir.1986), the court did not find a pattern although twelve predicate acts were alleged: 15 Mail fraud and wire fraud are perhaps unique among the various sorts of "racketeering activity" possible under RICO in that the existence of a multiplicity of predicate acts (here, the mailings) may be no indication of the requisite continuity of the underlying fraudulent activity. 16 Id. at 325 (Cudahy, J., concurring). 17 In their brief, the plaintiffs argue they could also prove a violation of the Hobbs Act, 18 U.S.C.
discussed Cited as authority (rule) Jennings v. Emry
7th Cir. · 1990 · confidence medium
But "simply alleging racketeering acts is not enough to allege a RICO pattern," Lipin Enter., Inc., 803 F.2d at 324, and simply alleging racketeering acts is all we can possibly credit the Appellants with here. 12 11 The "pattern" requirement aside, the Appellees also argue that the Appellants have failed adequately to allege a RICO enterprise.
discussed Cited as authority (rule) Jennings v. Emry
7th Cir. · 1990 · confidence medium
But “simply alleging racketeering acts is not enough to allege a RICO pattern,” Lipin Enter., Inc., 803 F.2d at 324, and simply alleging racketeering acts is all we can possibly credit the Appellants with here. 12 The “pattern” requirement aside, the Ap-pellees also argue that the Appellants have failed adequately to allege a RICO enterprise.
discussed Cited as authority (rule) Dalton v. Alston & Bird
S.D. Ill. · 1990 · confidence medium
Triad Associates, Inc. v. Chicago Housing Authority, 892 F.2d 583, 595 (7th Cir.1989); Ashland Oil, Inc. v. Arnett, 875 F.2d 1271, 1278-79 (7th Cir.1989); Lipin Enterprises Inc. v. Lee, 803 F.2d 322, 325 (7th Cir.1986) (Cudahy J., *1334 concurring).
discussed Cited as authority (rule) Triad Associates, Inc. v. Chicago Housing Authority
7th Cir. · 1990 · confidence medium
Finally, in Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986), we held that a sin gle fraudulent scheme with only one injury to one victim was not a “pattern of racketeering activity” under § 1962(c) simply because it required several acts of mail and wire fraud to inflict the single injury.
discussed Cited as authority (rule) Triad Associates, Inc. v. Chicago Housing Authority
7th Cir. · 1990 · confidence medium
Finally, in Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986), we held that a single fraudulent scheme with only one injury to one victim was not a "pattern of racketeering activity" under § 1962(c) simply because it required several acts of mail and wire fraud to inflict the single injury.
discussed Cited as authority (rule) Menasco, Inc. v. Wasserman
4th Cir. · 1989 · confidence medium
See e.g., Torwest DBC, Inc. v. Dick, 810 F.2d 925, 928-29 (10th Cir.1987); Medallion Television Enterprises, Inc. v. SelecTV of California, Inc., 833 F.2d 1360, 1362-64 (9th Cir.1987); Jones v. Lampe, 845 F.2d 755, 757-58 (7th Cir.1988); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323-24 (7th Cir.1986); Roeder v. Alpha Industries, Inc., 814 F.2d 22, 30-31 (1st Cir.1987). 18 This case presents a paradigm of one in which no pattern of racketeering activity is present.
discussed Cited as authority (rule) Menasco, Inc. v. Wasserman
4th Cir. · 1989 · confidence medium
See e.g., Torwest DBC, Inc. v. Dick, 810 F.2d 925, 928-29 (10th Cir.1987); Medallion Television Enterprises, Inc. v. SelecTV of California, Inc., 833 F.2d 1360, 1362-64 (9th Cir.1987); Jones v. Lampe, 845 F.2d 755, 757-58 (7th Cir.1988); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323-24 (7th Cir.1986); Roeder v. Alpha Industries, Inc., 814 F.2d 22, 30-31 (1st Cir.1987).
discussed Cited as authority (rule) Kimberly A. Sutherland v. Paul R. O'Malley and O'Malley & O'malley, Ltd. (2×) also: Cited "see"
7th Cir. · 1989 · confidence medium
Lipin, 803 F.2d at 325 (Cudahy, J., concurring), quoted in Arnett, supra, 875 F.2d at 15, 1278-79 . 9 .
discussed Cited as authority (rule) Cross v. Simons
N.D. Ill. · 1989 · confidence medium
A pattern of racketeering, as the Seventh Circuit has held, “requires at the barest minimum two ‘acts of racketeering activity,’ ... [although] much more than two such acts must be shown in order to demonstrate a pattern.” Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir. 1986), quoting 18 U.S.C. § 1961 (5); see also Sedima S.P.R.L. v. Imrex Co., 473 U.S. 479 , 496 n. 14, 105 S.Ct. 3275 , 3285 n. *595 14, 87 L.Ed.2d 346 (1985).
discussed Cited as authority (rule) Hofstetter v. Fletcher
6th Cir. · 1988 · confidence medium
Other courts have also purported to adopt a "case-by-case approach." See, e.g., Barticheck v. Fidelity Union Bank, 832 F.2d 36 (3d Cir.1987); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986); Garbade v. Great Divide Mining and Milling Corp., 831 F.2d 212 (10th Cir.1987). 27 In the instant case, it is undisputed that the defendants sold millions of dollars worth of insurance policies to scores of individual clients throughout the country by means of a fraudulent promotion whereby the defendants falsely represented that the potential investors could completely avoid payment of an…
discussed Cited as authority (rule) Hofstetter v. Fletcher
6th Cir. · 1988 · confidence medium
Other courts have also purported to adopt a "case-by-case approach." See, e.g., Barticheck v. Fidelity Union Bank, 832 F.2d 36 (3d Cir.1987); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986); Garbade v. Great Divide Mining and Milling Corp., 831 F.2d 212 (10th Cir.1987). 26 In the instant case, it is undisputed that the defendants sold millions of dollars worth of insurance policies to scores of individual clients throughout the country by means of a fraudulent promotion whereby the defendants falsely represented that the potential investors could completely avoid payment of an…
discussed Cited as authority (rule) Hofstetter v. Fletcher
6th Cir. · 1988 · confidence medium
Other courts have also purported to adopt a “case-by-case approach.” See, e.g., Barticheck v. Fidelity Union Bank, 832 F.2d 36 (3d Cir.1987); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986); Garbade v. Great Divide Mining and Milling Corp., 831 F.2d 212 (10th Cir.1987).
cited Cited as authority (rule) Sk Hand Tool Corporation and Corcoran Partners, Ltd. v. Dresser Industries, Inc.
7th Cir. · 1988 · confidence medium
Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986). 7 .
discussed Cited as authority (rule) Fisher v. Samuels
N.D. Ill. · 1988 · confidence medium
As the Seventh Circuit has held that although “[a] pattern of racketeering activities requires at the barest minimum two ‘acts of racketeering activity,’ ... much more than two such acts must be shown in order to demonstrate a pattern.” Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986), quoting 18 U.S.C. § 1961 (5); See also Sedima S.P.R.L. v. Imrex Co., 473 U.S. 479 , 496 n. 14, 105 S.Ct. 3275 , 3285 n. 14, 87 L.Ed.2d 346 (1985).
discussed Cited as authority (rule) In re Langley
E.D. Wis. · 1988 · confidence medium
The separate racketeering acts must reflect both “continuity” and “relatedness” in order to constitute a pattern. 803 F.2d at 323 (Emphasis added.) Since the separate racketeering acts must reflect both “continuity” and “relatedness” in order to constitute a pattern, it is not sufficient to allege, as the plaintiffs have in this case, that there were a number of phone conversations (commonly referred to as “predicate acts”) in which false representations were made to the Langleys, and that the mails were used to arrange, service, and receive payments on the loans.
discussed Cited as authority (rule) Medical Emergency Service Associates v. Foulke (2×)
7th Cir. · 1988 · confidence medium
Following these guidelines in Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986), we held that multiple fraudulent representations inducing the sale of a large block of stock did not constitute a "pattern" of fraudulent representations where the acts (1) occurred within a short period of time, (2) were related to a single transaction (inducing the stock sale), (3) involved a single victim, and (4) inflicted a single injury.
cited Cited as authority (rule) Derson Group, Ltd. v. Right Management Consultants, Inc.
N.D. Ill. · 1988 · confidence medium
Lipin Enterprises Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986). “[T]he target of RICO is not sporadic activity or the isolated offender.” Marks, 811 F.2d at 1111 .
discussed Cited as authority (rule) Medical Emergency Service Associates, S.C. v. Foulke (2×)
7th Cir. · 1988 · confidence medium
Following these guidelines in Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986), we held that multiple fraudulent representations inducing the sale of a large block of stock did not constitute a “pattern” of fraudulent representations where the acts (1) occurred within a short period of time, (2) were related to a single transaction (inducing the stock sale), (3) involved a single victim, and (4) inflicted a single injury.
discussed Cited as authority (rule) Wabash Valley Power Ass'n v. Public Service Co. of Indiana, Inc.
S.D. Ind. · 1988 · confidence medium
The separate racketeering acts must reflect both ‘continuity’ and ‘relatedness’ in order to constitute a pattern.” Lipin, 803 F.2d at 323 (citations omitted). *763 In its subsequent opinion in Morgan , the court further discussed the concept of a “pattern.” Initially, the court cautioned against focusing excessively on either the “continuity” or “relationship” prongs of the pattern requirement.
discussed Cited as authority (rule) United States v. John Horak, and United States of America v. John Horak (2×)
7th Cir. · 1987 · confidence medium
Horak appropriately directs attention to Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986), a civil RICO case where this court found no “pattern” established by twelve mail frauds perpetrated over a brief period of several months, relating to a single scheme to defraud a single victim in the sale of a business.
discussed Cited as authority (rule) Mary Kochton Appley v. Stuart West, Mary Kochton Appley v. National Republic Bank of Chicago
7th Cir. · 1987 · confidence medium
Lipin cannot allege that the defendants defrauded another victim with similar racketeering activity and cannot allege that Lipin has been defrauded more than once by the defendants through similar racketeering acts. 803 F.2d at 324.
examined Cited as authority (rule) Design Time, Inc. v. Synthetic Diamond Technology, Inc. (3×)
N.D. Ind. · 1987 · confidence medium
The court noted that the “pattern” requirement was meant to limit RICO “to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes”, and to those cases that present “some indication of a ‘threat of continuing activity’ by the de *1576 fendants, not just one instance of fraud with a single victim”. 803 F.2d at 324.
discussed Cited as authority (rule) Singh v. Curry
N.D. Ill. · 1987 · confidence medium
See Skycom Corp. v. Telstar Corp., 813 F.2d 810, 818 (7th Cir.1987); Marks v. Forster, 811 F.2d 1108, 1110 (7th Cir.1987); Elliott v. Chicago Motor Club Insurance, 809 F.2d 347, 349 (7th Cir.1986); Morgan v. Bank of Waukegan, 804 F.2d 970, 974 (7th Cir. 1986); Lipin Enterprises, Inc. v. Lee, 803 F.2d 322, 323 (7th Cir.1986).
discussed Cited as authority (rule) Omega Const. Co., Inc. v. Altman (2×) also: Cited "see"
W.D. Mich. · 1987 · confidence medium
See Lipin Enterprises Inc. v. Lee, 803 F.2d 322, 323-24 (7th Cir.1986); id. at 325 (Cudahy, J., concurring); Graham v. Slaughter, 624 F.Supp. 222, 224-25 (N.D.Ill.1985).
discussed Cited as authority (rule) Gutfreund v. Christoph
N.D. Ill. · 1987 · confidence medium
Under our Court of Appeals’ evolution of the term, the “single transaction” notion would likely insulate defendants only if their racketeering acts were all designed “to defraud one victim ... on one occasion” (Lipin Enterprises Inc. v. Lee, 803 F.2d 322, 324 (7th Cir.1986)).
Lipin Enterprises Incorporated, an Illinois Corporation
v.
Goldie W. Lee, Thomas Monahan, First National Bank of Skokie, Daniel J. McCarthy Marquette National Bank, McCarthy Duffy, Neidhart & Snakard, a Partnership, Arthur Hamer & Company, Gerald Dunklau and Chicago Title & Trust Company
85-2772.
Court of Appeals for the First Circuit.
Nov 12, 1986.
803 F.2d 322
Published

803 F.2d 322

RICO Bus.Disp.Guide 6403

LIPIN ENTERPRISES INCORPORATED, an Illinois corporation,
Plaintiff-Appellant,
v.
Goldie W. LEE, Thomas Monahan, First National Bank of
Skokie, Daniel J. McCarthy, Marquette National Bank,
McCarthy, Duffy, Neidhart & Snakard, a partnership, Arthur
Hamer & Company, Gerald Dunklau and Chicago Title & Trust
Company, Defendants-Appellees.

No. 85-2772.

United States Court of Appeals,
Seventh Circuit.

Argued May 15, 1986.
Decided Oct. 9, 1986.
Rehearing and Rehearing En Banc Denied Nov. 12, 1986.

Paul J. Petit, Betar & Petit, Chicago, Ill., for plaintiff-appellant.

Joshua G. Vincent, Hinshaw Culbertson Moelmann Hoban & Fuller, Chicago, Ill., Stephen A. Snakard, McCarthy Duffy Neidhart & Snakard, Chicago, Ill., for defendants-appellees.

Before BAUER, Chief Judge, CUDAHY, and RIPPLE, Circuit Judges.

BAUER, Chief Judge.

[*~322]1

Plaintiff, Lipin Enterprises, appeals the dismissal of its complaint for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). The district court dismissed Lipin's complaint, a civil RICO action, on the alternative grounds that the complaint failed to allege a RICO enterprise and failed to allege a pattern of racketeering activity. Lipin challenges both of these grounds as error. We agree with the district court that Lipin failed adequately to allege a pattern of racketeering activity. We affirm the dismissal of the complaint on that ground.

I.

2

Lipin is the unhappy buyer of Rifco Auto Leasing Company and its wholly-owned subsidiary, Modern Cars, Inc. In its complaint, Lipin alleges the seller and sole shareholder of Rifco, Goldie W. Lee, conspired with other parties involved in the sale (accountants, lawyers, and several banks) to dupe Lipin into buying Rifco for more than it was worth.

3

Lipin alleges that each of the defendants made fraudulent misrepresentations in order to accomplish the sale. Lipin is especially peeved by alleged overstatements of Rifco's net worth (since the purchase price was directly tied to this figure) and the omission of several equipment leases and open end leases from an inventory of leases relied upon by Lipin. (Lipin alleges that it was "crucial" for Lipin that there be "few or no" open end leases). The district court found that, as alleged, these misrepresentations amounted to at least twelve separate acts of mail fraud. Lipin Enterprises v. Lee, 625 F.Supp. 1098, 1099 (N.D.Ill.E.D.1985).

4

Nonetheless, the district court granted the defendants' motion under 12(b)(6) to dismiss Lipin's complaint. The court found that Lipin had failed to allege a RICO enterprise because "nothing in the complaint indicates that the defendants' alleged association was ongoing or that they functioned as a continuing unit." Lipin Enterprises v. Lee, 625 F.Supp. 1098, 1100 (N.D.Ill.E.D.1985). The court further held that if Rifco (and its subsidiary Modern Cars, Inc.) itself was viewed as the enterprise, Lipin had failed to allege participation by each of the defendants in the "affairs of those companies through a pattern of racketeering activity." Id. at 1100 (emphasis in original). The district court also held that the twelve alleged acts of mail fraud did not constitute "facts that would establish a pattern of racketeering activity." Id. at 1100 (emphasis in original). Lipin contends that the district court was simply wrong on all grounds and appeals to this court for reinstatement of its complaint.

II.

5

Lipin alleges the district erred when it found that the misrepresentations alleged in the complaint do not constitute a pattern of racketeering activity for RICO purposes. We disagree.

6

A pattern of racketeering activity requires at the barest minimum two "acts of racketeering activity." 18 U.S.C. Sec. 1961(5). In general, however, much more than two such acts must be shown in order to demonstrate a pattern. Sedima, S.P.R.L. v. Imrex Co., --- U.S. ---, 105 S.Ct. 3275, 3285 n. 14, 87 L.Ed.2d 346 (1985). The separate racketeering acts must reflect both "continuity" and "relatedness" in order to constitute a pattern. Id.; S.Rep. No. 617, 91st Cong., 1st Sess. 158 (1969). It is not enough, therefore, for Lipin simply to allege twelve acts of racketeering activity (the twelve acts of mail fraud) in order to allege a pattern of racketeering activity. Something more is required.

[*~323]7

What this "something more" is that needs to be shown in order to allege a RICO pattern has been the subject of some debate. Some courts have indicated that a RICO plaintiff must show not only two acts of racketeering activity but also two separate "schemes" in order to show a pattern. Superior Oil Co. v. Fulmer, 785 F.2d 252, 254-58 (8th Cir.1986); Grant v. Union Bank, 629 F.Supp. 570 (D.Utah 1986); Meyer v. Cloud County Bank & Trust, 647 F.Supp. 974 (D.Kan. 1986); Professional Assets Management v. Penn Square Bank, N.A., 616 F.Supp. 1418, 1420-23 (W.D.Okla.1985). Other courts have been unhappy with this formulation since it would allow a large continuous scheme to escape the enhanced penalties of RICO liability. These courts prefer a definition of pattern that would require a RICO plaintiff to show at least two separate criminal "episodes" rather than two separate schemes. Fleet Management Systems v. Archer-Daniels-Midland Co., 627 F.Supp. 550, 553-60 (C.D.Ill.1986); Marks v. Pannell Kerr Forster, No. 85 C 9399, slip op. (N.D.Ill. Mar. 21, 1986); Frankart Distributors v. RMR Advertising, 632 F.Supp. 1198 (S.D.N.Y.1986). Medallion TV Enterprise v. Selec TV of Cal., 627 F.Supp. 1290, 1295-97 (C.D.Cal.1985). An episode is apparently something more than an act of racketeering activity but something less than a scheme.

8

Since the Supreme Court clarified in Sedima, S.P.R.L. v. Imrex Co., --- U.S. ---, 105 S.Ct. 3275, 3285 n. 14, 87 L.Ed.2d 346 (1985) that a pattern of racketeering activity is generally more than two racketeering acts, this court has never explicitly addressed the question of the necessary requirements for a RICO pattern. We have indicated that the mailing of nine separate fraudulent tax returns constitutes a sufficient RICO pattern. Illinois Department of Revenue v. Phillips, 771 F.2d 312, 313 (7th Cir.1985). We did not explain in Phillips, however, whether the pattern was sufficiently established there by the nine separate returns because the returns were separate schemes or were separate episodes or because the mailings satisfied some other legal definition of "pattern." Fortunately, it is not necessary for us to formulate an exact definition of "pattern" of racketeering activity to dispose of Lipin's complaint. Whether this court will eventually adopt the separate scheme formulation, the separate episode formulation, or some other formulation of the requirements necessary to demonstrate a RICO pattern, it is clear that these requirements are not satisfied by Lipin's complaint.

9

The Supreme Court emphasized in Sedima that simply alleging racketeering acts is not enough to allege a RICO pattern. Sedima, 105 S.Ct. at 3285 n. 14. That is all that Lipin has done, and apparently all that Lipin can do. Lipin's complaint alleges racketeering acts all designed to defraud one victim, Lipin, on one occasion, the sale of Rifco. Lipin cannot allege that the defendants defrauded another victim with similar racketeering activity and cannot allege that Lipin has been defrauded more than once by the defendants through similar racketeering acts.

[*~324]10

Whatever more is required to allege a pattern of racketeering activity, that something more is lacking here. The pattern requirement was intended to limit RICO to those cases in which racketeering acts are committed in a manner characterizing the defendant as a person who regularly commits such crimes. ABA SECTION OF CORPORATION, BANKING & BUSINESS LAW, REPORT OF THE AD HOC CIVIL RICO TASK FORCE 203-08 (1985). RICO is not "aimed at the isolated offender." Sedima, 105 S.Ct. at 3285 n. 14 (quoting 116 Cong.Rec. 35, 193 (1970) (statement of Rep. Poff)). There must be some indication of a "threat of continuing activity" by the defendants, not just one instance of fraud with a single victim. S.Rep. No. 617, 91st Cong., 1st Sess. 158 (1969).

III.

11

The district court correctly dismissed Lipin's complaint for failure to allege a pattern of racketeering activity. We, therefore, need not reach the question of whether Lipin adequately alleged a RICO enterprise. The judgment of the district court is

12

AFFIRMED.

13

CUDAHY, Circuit Judge, concurring.

14

I agree that plaintiff has not alleged "a pattern of racketeering activity." I think it is important to note, however, that we are dealing here with mail fraud. Mail fraud and wire fraud are perhaps unique among the various sorts of "racketeering activity" possible under RICO in that the existence of a multiplicity of predicate acts (here, the mailings) may be no indication of the requisite continuity of the underlying fraudulent activity. Thus, a multiplicity of mailings does not necessarily translate directly into a "pattern" of racketeering activity. It is not clear that the same analysis would be appropriate in cases involving other kinds of predicate acts (like, for example, arson).