Opinion
Civil Action No. 00-2949, Section "C" (1)
September 18, 2002
ORDER AND REASONS
I. Introduction
Defendants Easy Money of Louisiana, Inc. ("Easy Money/LA"), Easy Money Holdings, Inc., Easy Money of Virginia, Inc., David L. Greenberg, Tammi Gorder, and Jerome Greenberg (collectively, "Defendants") move the Court for summary judgment under Rule 56, Fed.R.Civ.P. Defendants seek the dismissal of all remaining claims of Plaintiff, Johnetta McMahon ("Plaintiff," "McMahon") with prejudice. Counsel for Plaintiff has informed the Court that no opposition is offered. (Rec. Doc. #127).
After reviewing the motions, the memoranda and exhibits submitted, the applicable law, and the case record, the Court GRANTS summary judgment in favor of Defendants.
II. Background
Previously, the Court dismissed all of McMahon's claims against Defendants, except for claims under §§ 1962(c) and (d) of the Racketeering Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961, et seq. ("RICO"), based on the collection of unlawful debts arising from alleged violations of §§ 3578.6A(6) and 3578.6A(7) of the Louisiana Deferred Presentment and Small Loans Act, La. R.S. 9:3578.1 et seq. ("LDPA"). ( See Rec. Doc. Nos. 42, 94, 118 and 124).
In an Order, filed July 19, 2002, the Court dismissed McMahon's RICO § 1962(c) claim based on the collection of an unlawful debt involving alleged "loan splitting" under La. R.S. 9:3578.6A(4). (Rec Doc. No. 124). The Court also dismissed McMahon's RICO § 1962(d) conspiracy claim based on "loan splitting" on the grounds that the underlying § 1962(c) been dismissed. ( Id. at 12). Further, the Court reexamined its prior conclusion that the year 2000 loans made by Easy Money/LA to McMahon violated LDPA §§ 3578.6A(6) and 3578.6A(7). The Court concluded that these LDPA provisions prohibited "rollover" or "renewal" loans, but not the "overlapping" loans made by Easy Money/LA to McMahon. Accordingly, the Court granted Easy Money/LA's motion for summary judgment on McMahon's "overlapping" loan claim. ( Id. at 11-12).
Having determined that these "overlapping" loans did not violate state law, the Court stated that it would entertain a motion to dismiss McMahon's remaining §§ 1962(c) and (d) claims based on these loans. ( Id. at 12 n. 3). Consequently, Defendants now move to dismiss McMahon's remaining RICO §§ 1962(c) and (d) claims based on alleged violations of LDPA §§ 3578.6A(6) and 3578.6A(7) caused by "overlapping" loans.
III. Summary Judgment
The Court can grant a motion for summary judgment only when the "`pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.'" Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986) (quoting Fed.R.Civ.P. 56(c)). Upon such a showing, the burden shifts to the non-moving party to produce evidence of the existence of a genuine issue for trial. Id. A factual dispute is "genuine" if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Beck v. Somerset Technologies, Inc., 882 F.2d 993, 996 (5th Cir. 1989) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986)). When considering a motion for summary judgment, the Court "will review the facts drawing all inferences most favorable to the party opposing the motion." Reid v. State Farm Mutual Automobile Ins. Co., 784 F.2d 577, 578 (5th Cir. 1986).
III. Discussion
Liability under the RICO statute is predicated on acts that consist of "racketeering activities," as defined in RICO § 1961(1), or the collection of "unlawful debts," as defined in RICO § 1961(6). See Flowers v. Continental Grain Co., 775 F.2d 1051, 1054 (8th Cir. 1985) ("[P]laintiff seeking civil recovery under RICO must plead that defendants have committed two or more of the predicate criminal offenses."); Blount Financial Services, Inc. v. Walter E. Heller Co., 819 F.2d 151, 152 (6th Cir. 1987) (finding non-usurious loans do not support RICO predicate act of unlawful debt collection); Broyles v. Wilson, 812 F. Supp. 651, 657-58 (M.D. La 1993) aff'd 3 F.3d 439 (5th Cir 1993). In its July 19, 2002 Order, the Court concluded that the "overlapping" loans made by Easy Money/LA to McMahon did not violate LDPA §§ 3578.6A(6) and 3578.6A(7). Therefore, McMahon has failed to state a claim under Louisiana law and, as such, no RICO predicate acts (collection of unlawful debts) have occurred. Consequently, the RICO claims asserted against Defendants are dismissed. See Porter v. ACE Cash Express, Inc., No. Civ. A. 00-586, 2000 WL 1610632, at * 7 (E.D. La. Oct. 26, 2000) (finding that no "unlawful debt" existed, hence no RICO claim survived where fees and charges were in accordance with Louisiana Consumer Credit Law).
"unlawful debt" means a debt (A) incurred or contracted in gambling activity which was in violation of the law of the United States, a State or political subdivision thereof, or which is unenforceable under State or Federal law in whole or in part as to principal or interest because of the laws relating to usury, and (B) which was incurred in connection with the business of gambling in violation of the law of the United States, a State or political subdivision thereof, or the business of lending money or a thing of value at a rate usurious under State or Federal law, where the usurious rate is at least twice the enforceable rate[.] (emphasis added).
Agreements to collect unlawful debts constitute RICO predicate acts as well. See United States v. Anguilo, 847 F.2d 956, 964 (1st Cir. 1988) cert. denied, 488 U.S. 852, cert. denied, 488 U.S. 928 (1988).
Further, McMahon' s claim under § 1962(d) alleging that Defendants conspired to violate other subsections of § 1962 must necessarily fail, because the other substantive claims are themselves deficient. See Ashe v. Corley, 992 F.2d 540, 544 (5th Cir 1993); Blanchard Co. v. Contursi, Nos. Civ. A. 99-1758, Civ. A. 00-3018, 2000 WL 574590, at *4 n. 5 (E.D. La., May 11, 2000) (Berrigan, J.) ("Any section 1962(d) claim base don conspiracy to violate Section 1962(c) fails as a result of this dismissal."); Bellizan v. Easy Money of La., Inc., No. Civ. A. 00-2949, 2002 WL 1611648, at *7 (E.D. La., July 19, 2002) ("As McMahon's § 1962(c) loan-splitting claims have been dismissed, and as `[any [§] 1962(d) claim based on the conspiracy to violate Section 1962(c) fails as a result of this dismissal,' McMahon's § 1962(d) loan-splitting claims also must be dismissed.") (internal citation omitted). As discussed above, the Court has concluded that McMahon has no viable § 1962(c) claim based on violations of LDPA §§ 3578.6A(6) and 3578.6A(7), therefore, McMahon's § 1962(d) conspiracy claim is dismissed.
IV. Conclusion
Plaintiff has failed to make a showing sufficient to establish each of the elements essential to her RICO §§ 1962(c) and (d) claims, on which she will bear the burden at trial. Although McMahon offered no opposition to Defendants' motion for summary judgment, after review of the Defendants' motion, the memoranda and exhibits submitted, the applicable law, and the case record, the Court finds that there is no genuine issue as to any material fact in this case. Therefore, Defendants Easy Money of Louisiana, Inc., Easy Money Holdings, Inc., Easy Money of Virginia, Inc., David L. Greenberg, Tammi Gorder, and Jerome Greenberg are entitled to judgment as a matter of law. Because dismissal of these last remaining claims result in no further claims before the Court in this matter, the court clerk is notified to enter a final dismissal.
Accordingly, IT IS ORDERED that Defendants motion for summary judgment is hereby GRANTED with prejudice. It is further ORDERED that the case, in its entirety is DISMISSED.