O.C.G.A. § 16-14-6 (2019)

Annotations

Editor’s notes. Ga. L. 2015, p. 693, § 4-1/HB 233, not codified by the General Assembly, provides that: “This Act shall become effective on July 1, 2015, and shall apply to seizures of property for forfeiture that occur on or after that date. Any such seizure that occurs before July 1, 2015, shall be governed by the statute in effect at the time of such seizure.” Law reviews. For article, “The Civil Jurisdiction of State and Magistrate Courts,” see 24 Ga. St. B. J. 29 (1987).

For article, “A Comprehensive Analysis of Georgia RICO,” see 9 Georgia St. U.L. Rev. 537 (1993). For article, “Theories of Stockbroker and Brokerage Firm Liability,” see 9 Ga. St. B. J. 12 (2004). For article, “Overcoming Under-Compensation and Under-Deterrence in Intentional Tort Cases: Are Statutory Multiple Damages the Best Remedy?,” see 62 Mercer L. Rev. 449 (2011). For article on the 2015 amendment of this Code section, see 32 Georgia St. U.L. Rev. 1 (2015).

JUDICIAL DECISIONS Constitutionality. - Trial court’s dismissal of the claims against the in personam defendant was reversed because since the equitable remedies allowed by O.C.G.A. § 16-14-6(a) were available to other aggrieved parties as well as to the state, an action for such remedies was uncharacteristic of a criminal matter. As such, such a claim was not unconstitutional. State v. Singh, 291 Ga. 525, 731 S.E.2d 649, 2012 Ga. LEXIS 691 (2012). Legislative purpose not element of cause of action. - Expression of legislative purpose in enacting O.C.G.A. Ch. 14, T. 16 is not an element of a civil cause of action under RICO. State v. Shearson Lehman Bros., 188 Ga. App. 120, 372 S.E.2d 276, 1988 Ga. App. LEXIS 895 (1988); Reaugh v. Inner Harbour Hosp., 214 Ga. App. 259, 447 S.E.2d 617, 1994 Ga. App. LEXIS 1437 (1994), cert. denied, No. S94C1817, 1994 Ga. LEXIS 1179 (Ga. Dec. 2, 1994). O.C.G.A. Ch. 14, T. 16 requires the plaintiff to allege an organized crime

nexus. Georgia Gulf Corp. v. Ward, 701 F. Supp. 1556, 1987 U.S. Dist. LEXIS 14352 (N.D. Ga. 1987). Claim for attorney fees based on bad faith. - Loan servicer’s argument that the borrowers’ claim for attorney fees should be dismissed lacked merit because regardless of whether the loan servicer had acted in bad faith, the court could not, at a motion to dismiss stage, rule on whether the loan servicer had been stubbornly litigious or whether it had caused the borrowers unnecessary trouble and expense. Kerfoot v. FNF Servicing, Inc., No. 1:13-cv-33, 2013 U.S. Dist. LEXIS 153849 (M.D. Ga. Oct. 25, 2013). Subsection (c). - Authorization of recovery of post-trial attorney fees and costs in O.C.G.A. § 16-14-6(c) does not violate equal protection, due process, or chill the rights of litigants seeking appellate review. Dee v. Sweet, 268 Ga. 346, 489 S.E.2d 823, 1997 Ga. LEXIS 509 (1997). Standing. - Party indirectly injured by Racketeer Influenced and Corrupt

Organizations (RICO), O.C.G.A. § 16-14-1 et seq., offense lacks standing to bring a RICO claim. Morast v. Lance, 631 F. Supp. 474, 1986 U.S. Dist. LEXIS 27392 (N.D. Ga. 1986), aff’d, 807 F.2d 926, 1987 U.S. App. LEXIS 1016 (11th Cir. 1987). National bank vice president, who was discharged for reporting an irregular transaction to the comptroller of the currency, was not entitled to relief under O.C.G.A. § 16-14-1 et seq., since the vice president was not fired because of a refusal to participate in the bank’s illegal scheme and, consequently, the vice president’s injury did not flow directly from the banking violations. Morast v. Lance, 807 F.2d 926, 1987 U.S. App. LEXIS 1016 (11th Cir. 1987). Forfeiture. - Trial court properly allowed only individual members of a class to assert their claims against forfeited funds or property because the members were trying to use the property or funds forfeited in the Georgia Racketeer Influenced and Corrupt Organizations (RICO) Act, O.C.G.A. § 16-14-1 et seq., proceeding as a recovery “superfund” for their federal class action claims; the members cited no authority supporting the members’ contention that a federally certified class in a federal class action case had to be considered to be an “injured person,” as that term was used in RICO, O.C.G.A. § 16-14-6(d), in proceedings instituted under a state RICO forfeiture provision. Smith v. Cisco, 316 Ga. App. 871, 730 S.E.2d 583, 2012 Ga. App. LEXIS 671 (2012), cert. denied, No. S12C1922, 2012 Ga. LEXIS 976 (Ga. Nov. 19, 2012). While the Georgia Racketeer Influenced and Corrupt Organizations Act, O.C.G.A. § 16-14-1 et seq., specifically O.C.G.A. § 16-14-6(d), allows an injured person to intervene and to make a claim to the forfeited property and that claim is superior to that of the state, there is nothing in the statute that gives injured persons the right to dictate to the state which property should be forfeited to the state; thus, nothing in the statute prevents the state from making a “unilateral decision” concerning which property it will pursue in the forfeiture

proceedings. Smith v. Cisco, 316 Ga. App. 871, 730 S.E.2d 583, 2012 Ga. App. LEXIS 671 (2012), cert. denied, No. S12C1922, 2012 Ga. LEXIS 976 (Ga. Nov. 19, 2012). Bond. - Because officers failed to move in the trial court for the state to post a bond under the Georgia Racketeer Influenced and Corrupt Organizations Act, O.C.G.A. § 16-14-1 et seq., specifically O.C.G.A. § 16-14-6(b), the officers’ claim that the trial court erred in not requiring the state to post a bond would not be considered on appeal; the officers did move for the receiver to post a bond, but the trial court had discretion whether or not to require the receiver to give a bond conditioned for the faithful discharge of the trust reposed, O.C.G.A. § 9-8-10, and the trial court did not abuse that discretion. Pittman v. State, 288 Ga. 589, 706 S.E.2d 398, 2011 Ga. LEXIS 149 (2011). Sufficiency of complaint. - Complaint which alleges that the plaintiff was injured as a result of the defendant having committed at least two similar or interrelated predicate offenses shall survive a motion to dismiss for failure to state a claim. State v. Shearson Lehman Bros., 188 Ga. App. 120, 372 S.E.2d 276, 1988 Ga. App. LEXIS 895 (1988). Unpublished decision: Former employee’s Georgia Racketeer Influenced and Corrupt Organizations Act, O.C.G.A. § 16-14-1 et seq., claim, alleging the former employer was defrauding customers and engaging in racial discrimination, failed because there was no evidence the employee was injured by the commission of any predicate acts, and despite the employee’s apparent argument to the contrary, racial discrimination was not listed under former paragraph (9) of O.C.G.A. § 16-14-3 as a predicate act. Giles v. BellSouth Telecomms., Inc., 542 Fed. Appx. 756, 2013 U.S. App. LEXIS 20231 (11th Cir. 2013). Trial court properly ruled that the basis for treble damages under RICO had not been proved as only the principal damage award supported by the record was the $5,960.63 amount reflected in the check attached to the complaint and the complaint otherwise did not break down an

award by claim. Stewart Ausband Enters. v. Holden, 349 Ga. App. 295, 826 S.E.2d 138, 2019 Ga. App. LEXIS 153 (2019). Preponderance of evidence required. - In a civil action under the Georgia RICO Act, O.C.G.A. § 16-14-1 et seq., given the similarities in the purpose and language of the federal and Georgia RICO statutes, together with the General Assembly’s mandate to liberally construe the Act to effectuate its remedial purposes, under O.C.G.A. § 16-14-2(b), the applicable standard of proof in state civil RICO actions was held to be a preponderance of the evidence; thus, the Supreme Court of Georgia overruled Simpson Consulting, Inc. v. Barclays Bank PLC, 227 Ga. App. 648 (490 SE2d 184) (1997), and those other cases holding to the contrary, specifically, Blanton v. Bank of America, 256 Ga. App. 103 (2002), In re Copelan, 250 Ga. App. 856 (2001), and Tronitec, Inc. v. Shealy, 249 Ga. App. 442 (2001). Williams Gen. Corp. v. Stone, 279 Ga. 428, 614 S.E.2d 758, 2005 Ga. LEXIS 445 (2005). Trial court erred in a bifurcated suit asserting a claim of illegal insurance sales under the Georgia Racketeer Influenced and Corrupt Organizations Act (Georgia RICO), O.C.G.A. § 16-14-1 et seq., by instructing the jury that the suing passenger of a cab was required to prove the asserted Georgia RICO claims against two cab companies by clear and convincing evidence as the proper standard of proof to have been applied was a preponderance of the evidence. Am. Ass’n of Cab Cos. v. Parham, 291 Ga. App. 33, 661 S.E.2d 161, 2008 Ga. App. LEXIS 329 (2008), cert. denied, No. S08C1409, 2008 Ga. LEXIS 690 (Ga. Sept. 8, 2008). Trial court properly granted summary judgment on the ground that there was no genuine issue of material fact as to whether the executor committed a predicate act for purposes of Georgia’s RICO Act, O.C.G.A. § 16-14-1 et seq., as a result of concluding that alleged misrepresentations by the executor - the alleged predicate offenses - were not the proximate cause of the lodge’s loss or damages since it failed to have in place any reasonable measures to check the treasurer’s work. Benevolent Lodge No. 3

v. Davis, 365 Ga. App. 564, 878 S.E.2d 760, 2022 Ga. App. LEXIS 478 (2022). Preclusion. - When victims of a fraudulent scheme who sued the perpetrator of the fraud under the Georgia Racketeer Influenced and Corrupt Organizations Act, O.C.G.A. § 16-14-1 et seq., had previously unsuccessfully sued the perpetrator for fraud and related claims, judgment n.o.v. was properly entered in favor of the perpetrator because the victims’ claim was barred by res judicata and collateral estoppel, as it should have been raised in their previous suits against the perpetrator, which involved the same parties and the same subject matter. Austin v. Cohen, 268 Ga. App. 650, 602 S.E.2d 146, 2004 Ga. App. LEXIS 877 (2004), cert. denied, No. S04C2018, 2004 Ga. LEXIS 981 (Ga. Oct. 25, 2004). Remedy at law does not preclude injunctive relief. - Even if the plaintiff had a remedy at law in the form of money damages for breach of contract, a preliminary injunction was proper when issued in accordance with O.C.G.A. § 16-14-6. Cotton, Inc. v. Phil-Dan Trucking, Inc., 270 Ga. 95, 507 S.E.2d 730, 1998 Ga. LEXIS 1042 (1998). Proof required for treble damages. - In an action based on a violation of O.C.G.A. § 16-10-20, prohibiting the making of false statements, even though plaintiff had to show the defendants’ criminal acts injured plaintiff to recover treble damages, plaintiff’s inability to show that plaintiff was actually misled by the false statements was not fatal. Maddox v. Southern Eng’g Co., 216 Ga. App. 6, 453 S.E.2d 70, 1994 Ga. App. LEXIS 1415 (1994). Admission of facts by default estopped introducing evidence to rebut the admission of liability. - Admitted facts supported the defendant’s liability on plaintiff’s claims of fraud and a civil RICO violation, thus, defendant was estopped from arguing liability on those claims and was precluded from introducing evidence to rebut the admission of liability; therefore, the trial court erred by denying the plaintiff’s motion in limine on that topic. Hansford v. Veal, 369 Ga. App. 641, 894 S.E.2d 215, 2023 Ga. App. LEXIS 505 (2023).

Attorney fees. - In light of the practical difficulties required in allocating attorney fees to specific claims in Racketeer Influenced and Corrupt Organizations Act (RICO), O.C.G.A. § 16-14-1 et seq., cases, it will not be required unless the unsuccessful claims and those not receiving awards of attorney fees are distinctly different claims for relief, based on different facts and legal theories. Dee v. Sweet, 218 Ga. App. 18, 460 S.E.2d 110, 1995 Ga. App. LEXIS 634 (1995), cert. denied, No. S95C1718, 1995 Ga. LEXIS 1087 (Ga. Oct. 13, 1995). Damages award of $1.00 was sufficient to justify the award of attorney fees. Dee v. Sweet, 218 Ga. App. 18, 460 S.E.2d 110, 1995 Ga. App. LEXIS 634 (1995), cert. denied, No. S95C1718, 1995 Ga. LEXIS 1087 (Ga. Oct. 13, 1995). Prevailing plaintiffs in a RICO action could recover attorney fees and costs related to the investigation and litigation of actions necessary to collect on the RICO judgment they were awarded. Dee v. Sweet, 268 Ga. 346, 489 S.E.2d 823, 1997 Ga. LEXIS 509 (1997). Plain language of O.C.G.A. § 16-14-6(c) makes it clear that the statutory award of attorneys’ fees represents a separate and distinct interest awarded to compensate each injured plaintiff individually. Darden v. Ford Consumer Fin. Co., 200 F.3d 753, 2000 U.S. App. LEXIS 376 (11th Cir. 2000). Each plaintiff’s share of the attorneys’ fees recoverable under Georgia’s RICO statute, O.C.G.A. § 16-14-1 et seq., may not be aggregated to satisfy the amount-in-controversy requirement because under Georgia law each individual plaintiff has a separate and distinct statutory right or claim to recover those attorneys’ fees, and Georgia law provides that those fees are to compensate the injured plaintiff. Darden v. Ford Consumer Fin. Co., 200 F.3d 753, 2000 U.S. App. LEXIS 376 (11th Cir. 2000). Arbitration agreements’ class action waiver was valid and enforceable because the arbitration agreements expressly permitted the borrower/plaintiff and the other consumers to recover attorneys’ fees and expenses “if allowed by statute or

applicable law” and such relief was available under the applicable law, Georgia’s Racketeering Influenced and Corrupt Organizations Act, specifically O.C.G.A. § 16-14-6(c). Jenkins v. First Am. Cash Advance of Ga., LLC, 400 F.3d 868, 2005 U.S. App. LEXIS 2922 (11th Cir. 2005), cert. denied, 546 U.S. 1214, 126 S. Ct. 1457, 164 L. Ed. 2d 132, 2006 U.S. LEXIS 1842 (2006). Exhaustion of administrative remedies. - Allegation of Insurance Code violations does not transform a civil RICO complaint into a cause of action which must be pursued exclusively through administrative channels, particularly when numerous other predicate acts are alleged in the complaint including fraud. Provident Indem. Life Ins. Co. v. James, 234 Ga. App. 403, 506 S.E.2d 892, 1998 Ga. App. LEXIS 1258 (1998), cert. denied, No. S99C0074, 1999 Ga. LEXIS 72 (Ga. Jan. 15, 1999). Bankruptcy. - State racketeering action against the family of a debtor based on a property transfer to avoid debt collection was not property of a bankruptcy estate because a trustee stood in the shoes of the debtor, who could not have asserted the action against the family due to a role as a coconspirator. Johnson v. Flatau, 329 B.R. 910, 2005 Bankr. LEXIS 543 (Bankr. M.D. Ga. 2005), aff’d, 339 B.R. 524, 2006 U.S. Dist. LEXIS 11356 (M.D. Ga. 2006). Automatic stay did not prohibit a state racketeering action brought against the family of a debtor relating to the transfer of property to avoid debt collection because a judgment against the family would not have been in effect a judgment against the estate; the family was not entitled to indemnity from the estate. Johnson v. Flatau, 329 B.R. 910, 2005 Bankr. LEXIS 543 (Bankr. M.D. Ga. 2005), aff’d, 339 B.R. 524, 2006 U.S. Dist. LEXIS 11356 (M.D. Ga. 2006). Treble damages and attorneys fees awarded. - Internet service provider’s success on both the provider’s federal and state RICO claims each independently mandated the trebling of the provider’s damages, including the provider’s attorneys fees, under 18 U.S.C. § 1964(c) and O.C.G.A. § 16-14-6(c), respectively,

against an individual who had stolen Internet accounts in order to engage in unlawful spamming and spoofing activities. Earthlink, Inc. v. Carmack, No. 1:02-CV-3041-TWT, 2003 U.S. Dist. LEXIS 9963 (N.D. Ga. May 7, 2003). Estoppel to contest liability following criminal conviction. - Trial court erred in denying an investor’s motion for partial summary judgment as to the business person’s liability on the

investor’s civil Georgia Racketeer Influenced and Corrupt Organization Act (RICO), O.C.G.A. § 16-14-1 et seq., claim against the business person because the business person’s criminal conviction estopped the business person from contesting civil liability pursuant to RICO, O.C.G.A. § 16-14-6(c). Cox v. Mayan Lagoon Estates Ltd., 319 Ga. App. 101, 734 S.E.2d 883, 2012 Ga. App. LEXIS 1032 (2012).

RESEARCH REFERENCES ALR. Construction and application of Racketeer Influenced and Corrupt Organizations Act (RICO) nationwide service of process provision, 18 U.S.C.A. § 1965, 65 A.L.R. Fed. 2d 21.

Construction and Application of Federal Racketeer and Corrupt Organization Act’s (RICO) Remedial Provision, 18 U.S.C.A. § 1964(a), 23 A.L.R. Fed. 3d 6.