From Capone To Corporations: Supreme Court Ruling On Civil RICO Claims Could Create Uptick In Personal Injury Lawsuits

• Published date: 10 April 2025
• Subject Matter: Litigation, Mediation & Arbitration, Cannabis & Hemp, Trials & Appeals & Compensation, Personal Injury
• Law Firm: Crowell & Moring LLP
• Author: Mr Andrew D. Kaplan, Emily Tucker and Helena Alvarez

On April 2, 2025, the U.S. Supreme Court extended the reach of Section 1964(c) of the Racketeer Influenced and Corrupt Organizations (RICO) Act by holding that a plaintiff may seek treble damages for a business or property loss resulting from a personal injury.¹ The 5-4 decision has resolved a 3-2 circuit split over whether the RICO statute precludes relief for losses stemming from a personal injury.

Civil Actions Under RICO

Passed by Congress in 1970, RICO is a federal law that prohibits a person from investing, acquiring, or participating in an enterprise through a pattern of racketeering activity involving certain "predicate acts", such as murder, kidnapping, gambling, arson, robbery, bribery, extortion, and drug dealing.² The law provides a private treble damage right of action to "[a]ny person injured in his business or property by reason of a violation of [RICO]"³

RICO was originally intended to combat organized crime. However, as Justice Powell noted in his dissent in Sedima, S.P.R.L. v. Imrex Co.⁴, "[o]nly a small fraction of the scores of civil RICO cases now being brought implicate organized crime in any way." Because some of the potential predicate acts under RICO involve infliction of personal injuries, plaintiffs have attempted to bring civil RICO claims for economic losses (i.e., business or property losses) arising from personal injuries. The Supreme Court's recent opinion addresses whether RICO should serve as an available remedy for plaintiffs who have suffered an economic loss stemming from a personal injury.

Case Background

This case deals with a RICO claim brought by a commercial truck driver against an alternative medicine manufacturer. Seeking relief from chronic pain, Plaintiff Douglas Horn purchased and began taking "Dixie X", a purportedly THC-free CBD tincture made by defendant Medical Marijuana, Inc. Several weeks...