Mills et al v. Atlas Drilling LLC

REPLY to Response to Motion re MOTION to Dismiss

W.D. Okla.October 23, 2017

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF OKLAHOMA (1) TAYLOR MILLS ) (2) ALLEN O’HARA ) (3) JOSEPH NEWMAN, ) ) Plaintiffs, ) ) v. ) Case No. 5:17-cv-00809-HE ) (1) ATLAS DRILLING, LLC, ) ) Defendant. ) DEFENDANT’S REPLY IN SUPPORT OF ITS MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM Defendant Atlas Drilling, LLC (“Atlas”), hereby submits its Reply in support of its Motion to Dismiss Plaintiffs’ claim regarding alleged violations of 18 U.S.C. § 1962 (hereinafter, “RICO”). 1 Plaintiffs have failed to plead sufficient facts to allege Atlas engaged in two distinct predicate acts in furtherance of its purported activity in violation of the Immigration and Nationality Act. Moreover, Plaintiffs’ Complaint is entirely devoid of any allegations to support the requisite “financial gain” element of their RICO claim. Based upon these glaring factual omissions in their Complaint, and inadequate attempt to remedy the same in their Response, dismissal is appropriate under Rule 12(b)(6). 1 As noted by Plaintiffs in their Response, following submission of its Motion to Dismiss, Atlas withdrew the portion of the Motion relating to an alleged claim of intentional infliction of emotional distress. [Doc. No. 15.] Therefore, Atlas seeks dismissal only of Plaintiffs’ RICO claim. Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 1 of 9 2 ARGUMENT AND AUTHORITY As noted in Plaintiffs’ response to the Motion, “[i]t is not enough for a plaintiff to file a RICO claim, chant the statutory mantra, and leave the identification of the predicate acts to the time of trial.” [Doc. No. 17, Pls.’ Resp., p. 6.]. Additionally, while a court “will accept well-pled allegations as true for purposes of the motion, it will not accept unsupported conclusions, unwarranted inferences, or sweeping legal conclusions cast in the form of actual allegations.” Zavala, 393 F.Supp.2d at 302 (citing Miree v. DeKalb, 433 U.S. 25(1977). Despite acknowledging these admonitions, Plaintiffs’ Complaint does just that. The very case law cited in support of their own Response clearly reflects that neither their Complaint, nor proposed amendment thereto, satisfy the threshold requirements necessary for a RICO claim. Accordingly, Atlas’s Motion to Dismiss should be granted. I. Plaintiffs have not sufficiently pled that Atlas engaged in two distinct predicate acts in violation of the INA. In order to properly establish a civil RICO claim under violations of the Immigration and Nationality Act (“INA”), Plaintiffs must, beyond mere conclusory statements, properly allege that: (1) Atlas has committed at least two distinct but related acts of racketeering activity (“predicate acts”); (2) which resulted in economic harm to the Plaintiffs; (3) that were performed for purposes of financial gain. See [Doc. No. 14, p. 5]; see also [Doc. No. 17, Plfs.’ Resp., p. 6. In addition to the obvious shortcomings regarding their requisite allegations of Atlas’s purported racketeering activity, Plaintiffs Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 2 of 9 3 have conveniently overlooked the part of section 274 of the INA that requires a connection between such alleged activities and Atlas’s purported financial gain. a. Hiring. Plaintiffs allege they were terminated and replaced, in whole or in part, by undocumented aliens in furtherance of Atlas’s racketeering scheme, and that “each illegal alien hired constitutes a separate [predicate] act” of Atlas’s pattern of racketeering activity. [Doc. No. 17, Plfs.’ Resp., p. 11-12.] This is a fundamental misinterpretation of both the RICO statutes and applicable case law regarding illegal hiring practices for multiple reasons. First, in order for a violation of section 274 of the INA to qualify as a predicate act, 8 U.S.C. § 1324(a)(3)(A) requires that an employer must have, during any 12-month period, “knowingly hired for employment at least 10 individuals with actual knowledge that the individuals are aliens described in subparagraph B.” (emphasis added). Here, Plaintiffs contend that “[s]everal, if not all of the Latino workers who remained employed and/or were hired to replace Plaintiffs were undocumented, illegal aliens,” provides sufficient notice of the subject claims despite the fact that “Plaintiffs did not provide a precise number in pleading” as “[e]ach illegal alien hired” is a discrete act for purposes of the RICO analysis 2 . Plaintiffs theory, although novel, is wholly unsupported. In order to rise to the level of a RICO predicate act, it is clear Plaintiffs must, at a minimum, allege that Atlas (1) knowingly hired for employment (2) at least 10 illegal aliens (3) within any 2 While Section 274a of the INA also covers the employment of illegal aliens, a violation of that particular statute does not constitute a predicate act under RICO. Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 3 of 9 4 12-month period. See 8 U.S.C. § 1324(a)(3)(A) (setting forth requirements for a violation of the INA). Even if the Court finds that the phrase “several, if not all” is plausibly tantamount to the 10-employee minimum, Plaintiffs have failed to introduce any factual allegations which would support a finding that Atlas had knowledge of their illegal status or that those “Latino workers” who “remained employed” with Atlas were hired within a 12-month period of one another. However, assuming, arguendo, that Plaintiffs allegations are sufficient to satisfy the threshold pleading requirements applicable to 8 U.S.C. § 1324(a)(3)(A), the Court’s analysis does not end there. Plaintiffs are further required to make sufficient averments as to subparagraph (B) of said statute, requiring that employers have “actual knowledge” that the hired employee is an unauthorized alien “that has been brought into the United States in violation of this subsection.” 8 U.S.C. § 1324(a)(3)(B). As set forth in Zavala— a case relied upon by Plaintiffs in support of their Response—the court dismissed the plaintiffs’ claim for failing to allege that the defendant “had actual knowledge that the aliens not only were ‘unlawfully present in the United States,’ but also were ‘brought into the United States in violation of this subsection.” Zavala, 393 F.Supp.2d at 309. Furthermore, the district court in System Mgt., Inc. v. Loiselle, following the precedent set by Zavala, similarly dismissed the plaintiffs’ complaint for failing to properly assert facts regarding the employer’s actual knowledge as to the employee alien’s illegal status. System Mgt., Inc. v. Loiselle, 91 F.Supp.2d 401, 408 (D. Mass. 2000) (emphasis added). The plaintiffs in Loiselle actually pled that the employer knew of the employee’s illegal status, but failed to address “any factual allegation as to how the Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 4 of 9 5 aliens had been brought into the United States and that they were brought into the United States in violation of this employment provision. Id. Therefore, to avoid dismissal here, case law makes it clear that Plaintiffs must offer more than mere conclusory statements that Atlas had actual knowledge as to (1) how the employees arrived in this country; (2) that the employees were illegal aliens at the time they were hired; and (3) they were brought in to the country “by an employer for the purpose of illegal employment.” See Zavala, 393 F.Supp.2d at 309 (citing Loiselle, 91 F.Supp.2d at 408) (emphasis added). Even when read in the light most favorable to Plaintiffs, it is evident from both the instant Complaint, and proposed amendment thereto, that Plaintiffs cannot meet the threshold requirements to overcome dismissal of their RICO claim. b. Concealing and Shielding. In addition to the glaring deficiencies regarding the hiring aspect of Atlas’s purported racketeering scheme, Plaintiffs further rely on threadbare conclusory statements describing Atlas’s practice of concealing and shielding these so-called illegal aliens. When a particular statute fails to define certain terms, as is the case with these particular aspects of the INA, courts rely on the ordinary definitions of such terms. See Zavala, 393 F.Supp.2d at 306 (citations omitted). Thus, “to ‘conceal’ is to ‘prevent disclosure or recognition of’…and to ‘shield’ is to ‘protect with or as if with a shield’ or ‘provide with a protective cover or shelter’ or ‘to cut off from observation’ or ‘hide.’” Id. at 306 (citing Merriam-Webster On-Line Dictionary, http://www.merriamwebster.com). As was the case in Zavala, it is difficult here “to determine which allegations address Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 5 of 9 6 concealment or shielding” as none of Plaintiffs’ averments “sufficiently allege these acts.” See Zavala, at 306. Plaintiffs’ Response regarding the ‘concealing and shielding’ portions of their claim is more of the same--unsupported conclusions, unwarranted inferences, and sweeping legal conclusions cloaked under the guise of actual allegations requiring strained explanations such as: “it is entirely plausible that [Atlas] hid the illegal aliens’ status” while simultaneously failing to identify any facts in their Complaint in support of this statement. See [Doc. No. 17, Plfs.’ Resp., p. 9.] Plaintiffs attempt to overcome their glaring insufficiencies by isolating and seizing upon a single phrase from Atlas’s Motion in support of what is not required to survive dismissal. Atlas, in its Motion, offers the suggestion that Plaintiffs could have named the alleged illegal employees to avoid the challenges raised in Atlas’ Motion. [Doc. No. 14, Motion, p.3]. Plaintiffs’ Response, wholly abandoning the opportunity to argue in support of the sufficiency of its “concealing and shielding” allegation, decries Atlas’s suggestion as a pleading requirement. Plaintiffs have neglected to show their minimal facts are adequate, and thus, they remain in the same stagnant position---a position which requires dismissal under Rule 12(b)(6). Because Plaintiffs have failed to set forth two distinct predicate acts, as required by statute, no viable RICO violations exist. Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 6 of 9 7 II. Plaintiffs’ Complaint makes no mention, and their Response fails to address, the“financial gain” element required to maintain their RICO claim against Atlas. As noted by Plaintiffs, a civil RICO claim in the context of section 274 of the INA requires the commission of certain predicate acts as described above, provided such acts were “committed for financial gain.”[Doc. No. 17, Plfs.’ Resp., p. 7 (emphasis added)]. However, through their Complaint (and proposed amendment thereto), Plaintiffs fail to offer a single allegation regarding how Atlas’s alleged activity was for “financial gain.” Therefore, even accepting all other allegations as true, Plaintiffs’ Complaint fails to plead facts sufficient to meet the requisite elements for a RICO claim. Accordingly, the claim should be dismissed. CONCLUSION Based on the foregoing, Atlas respectfully request this Court grant its Motion to Dismiss. Respectfully submitted, s/ Andre’ B. Caldwell Bradley A. Gungoll, OBA #3660 Austin J. Keeney, OBA #22420 GUNGOLL, JACKSON, BOX & DEVOLL, P.C. 101 Park Avenue, Suite 1400 Oklahoma City, Oklahoma 73102 P: (405) 272-4710 F: (405) 272-5141 gungoll@gungolljackson.com keeney@gungolljackson.com -and- Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 7 of 9 8 Samuel R. Fulkerson, OBA #14370 Andre’ B. Caldwell, OBA #22092 Gauri D. Nautiyal, OBA #31669 OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. 101 Park Avenue, Suite 1300 Oklahoma City, Oklahoma 73102 P: (405) 546-3772 F: (405) 652-1401 sam.fulkerson@ogletree.com andre.caldwell@ogletree.com gauri.nautiyal@ogletree.com ATTORNEYS FOR DEFENDANT Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 8 of 9 CERTIFICATE OF SERVICE I hereby certify that on October 23, 2017, I electronically filed the foregoing document with the Clerk of Court using the CM/ECF system which will automatically send an email notification of such filing to all attorneys of record at this time. s/ Andre’ B. Caldwell Andre’ B. Caldwell 31709203.3 Case 5:17-cv-00809-HE Document 20 Filed 10/23/17 Page 9 of 9