Robertson v. Sun Life Financial et al

MOTION to Dismiss for Failure to State a Claim FOR VIOLATIONS OF RICO AND THE LOUISIANA RACKETEERING ACT

E.D. La.April 12, 2017

00407395 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA LEVI E. ROBERTSON, on behalf of himself and all others similarly situated, Plaintiff, v. SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.), WACHOVIA BANK, N.A., and MATTHEW PIZZOLATO, Defendants No. 2:17-CV-02148 SECTION: “R” DIVISION: 1 JUDGE: SARAH S. VANCE MAGISTRATE JUDGE: JANIS VAN MEERVELD DEFENDANT SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)’S MOTION TO DISMISS PLAINTIFF’S CLAIMS FOR VIOLATIONS OF RICO AND THE LOUISIANA RACKETEERING ACT On October 9, 2008, Plaintiff Levi E. Robertson filed this action against Sun Life Financial, Sun Life Assurance Company of Canada, Sun Life Administrators, (U.S.), Inc., Wachovia Bank, N.A., Capitol One Bank, N.A., and Matthew Pizzolato, asserting Louisiana state common law claims. Nearly a decade later—after three amendments to the Petition for Damages and two trips to the Louisiana Court of Appeals—Plaintiff asserts, for the first time, claims for violations of the federal Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. §§ 1961-68, and the Louisiana state equivalent, La. Stat. Ann. §§ 15:1351-56 (“LRA”). Pursuant to Federal Rules of Civil Procedure 9(b) and 12(b)(6), defendant Sun Life Assurance Company of Canada (U.S.) hereby moves to dismiss these claims. First, Plaintiff’s racketeering claims are barred by the applicable statutes of limitations and do not relate back to Plaintiff’s original claims because they rely on new allegations and raise novel theories of liability. Case 2:17-cv-02148-SSV-JVM Document 23 Filed 04/12/17 Page 1 of 3 00407395 Second, Plaintiff’s substantive RICO claim must be dismissed because he has failed to plausibly allege two of the elements necessary to establish a RICO violation: the existence of a criminal enterprise and a pattern of racketeering activity. See St. Germain v. Howard, 556 F.3d 261, 263 (5th Cir. 2009). Third, because Plaintiff’s has failed to establish a substantive RICO violation, his conspiracy claim necessarily fails. Robinson v. Standard Mortg. Corp., 191 F. Supp. 3d 630, 646 (E.D. La. 2016). Finally, Plaintiff’s LRA claim fails for the same reasons as his RICO claim. In addition, Plaintiff has failed to identify a single predicate state law violation, as required to state a claim under the LRA. DATED: April 12, 2017 /s/ Edward W. Trapolin Edward W. Trapolin (#27667) Kelly Juneau Rookard (#30573) Irwin Fritchie Urquhart & Moore, LLC 400 Poydras Street, Suite 2700 New Orleans, Louisiana 70130 Telephone: (504) 310-2100 Facsimile: (504) 310-2101 Andrea J. Robinson (pro hac vice) Timothy J. Perla (pro hac vice) Ian D. Coghill (pro hac vice) Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, Massachusetts 02109 Telephone: (617) 526-6000 Facsimile: (617) 526-5000 Attorneys for Sun Life Assurance Company of Canada (U.S.) Case 2:17-cv-02148-SSV-JVM Document 23 Filed 04/12/17 Page 2 of 3 00407395 CERTIFICATE OF SERVICE I hereby certify that, on April 12, 2017, the foregoing was filed electronically with the Clerk of Court using the CM/ECF system. Notice of this filing will be sent to all counsel of record by operation of the Court’s electronic filing system. /s/ Edward W. Trapolin __________________________________ Case 2:17-cv-02148-SSV-JVM Document 23 Filed 04/12/17 Page 3 of 3 00407396 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA LEVI E. ROBERTSON, on behalf of himself and all others similarly situated, Plaintiff, v. SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.), WACHOVIA BANK, N.A., and MATTHEW PIZZOLATO, Defendants NO: 2:17-CV-02148 SECTION: “R” DIVISION: 1 JUDGE SARAH S. VANCE MAGISTRATE JANIS VAN MEERVELD MEMORANDUM IN SUPPORT OF DEFENDANT SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)’S MOTION TO DISMISS PLAINTIFF’S CLAIMS FOR VIOLATIONS OF RICO AND THE LOUISIANA RACKETEERING ACT Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 1 of 27 00407396 i ActiveUS 161347069v.12 TABLE OF CONTENTS Page INTRODUCTION ...........................................................................................................................1 BACKGROUND .............................................................................................................................2 I. For Eight Years, Plaintiff Prosecuted an Individual Action Premised Upon Sun Life’s Allegedly Negligent Breach of Contract ...................................................................2 II. In 2017, Plaintiff Drastically Altered His Case ...................................................................3 ARGUMENT ...................................................................................................................................4 I. Plaintiff’s RICO and LRA Claims Are Time Barred ...........................................................4 II. Plaintiff Fails To State a RICO Claim and To Meet Governing Pleading Requirements .......................................................................................................................6 A. Plaintiff Fails to Allege the Existence of a Criminal “Enterprise” ..........................6 B. Plaintiff Fails to Allege That Sun Life Conducted or Participated in the Enterprise, as Required by § 1962(c) .....................................................................10 C. Plaintiff Fails to Allege a “Pattern of Racketeering Activity” ...............................11 1. Plaintiff Fails to Allege Two Predicate Acts .............................................11 a) Plaintiff Has Not Sufficiently Alleged That Sun Life Is Liable For Mail Fraud ....................................................................11 b) Plaintiff Has Not Plausibly Alleged That Sun Life Is Liable For a Violation of the National Stolen Property Act .....................13 2. Plaintiff Has Not Satisfied the “Pattern” Requirement ..............................15 III. Plaintiff Fails to Allege a RICO Conspiracy .....................................................................18 IV. Plaintiff Fails to State a Claim Under the LRA .................................................................19 CONCLUSION ..............................................................................................................................20 Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 2 of 27 00407396 ii ActiveUS 161347069v.12 TABLE OF AUTHORITIES Page(s) Federal Cases Abraham v. Singh, 480 F.3d 351, 355 (5th Cir. 2007) .............................................................................................6 Agency Holding Corp. v. Malley-Duff & Assocs., Inc., 483 U.S. 143 (1987) ...................................................................................................................4 Atel Mar. Inv’rs, LP v. Sea Mar Mgmt., L.L.C., No. CIV.A. 08-1700, 2012 WL 2994337 (E.D. La. July 20, 2012) ........................................16 Baker v. IBP, Inc., 357 F.3d 685 (7th Cir. 2004) .....................................................................................................8 Boyle v. United States, 556 U.S. 938 (2009) .............................................................................................................7, 10 Calcasieu Marine Nat. Bank v. Grant, 943 F.2d 1453 (5th Cir. 1991) .................................................................................................17 Delta Truck & Tractor, Inc. v. J.I. Case Co., 855 F.2d 241 (5th Cir. 1988) ...............................................................................................7, 16 Dooley v. United Techs. Corp., 803 F. Supp. 428 (D.D.C. 1992) ..............................................................................................11 Elliott v. Foufas, 867 F.2d 877 (5th Cir. 1989) .....................................................................................................7 Fasugbe v. Williams, No. CIV. 2:10-2320 WBS, 2011 WL 2119128 (E.D. Cal. May 26, 2011) .............................13 Flaherty & Crumrine Preferred Income Fund, Inc. v. TXU Corp., 565 F.3d 200 (5th Cir. 2009) .....................................................................................................6 H.J. Inc. v. Nw. Bell Tel. Co., 492 U.S. 229 (1989) ...........................................................................................................15, 17 Holmes v. Greyhound Lines, Inc., 757 F.2d 1563, 1566 (5th Cir. 1985) .........................................................................................5 In re Burzynski, 989 F.2d 733, 742-43 (5th Cir. 1993) ........................................................... 15-16 Int’l Data Bank, Ltd. v. Zepkin, 812 F.2d 149 (4th Cir. 1987) ...................................................................................................15 Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 3 of 27 00407396 iii ActiveUS 161347069v.12 Lachmund v. ADM Investor Servs., Inc., 191 F.3d 777 (7th Cir.1999) ....................................................................................................18 Manax v. McNamara, 842 F.2d 808 (5th Cir.1988) ......................................................................................................7 United States v. Manzella, 782 F.2d 533 (5th Cir. 1986) .....................................................................................................8 Marcotte v. Bank of Am., No. CIV.A. H-14-2773, 2015 WL 2184369 (S.D. Tex. May 11, 2015) ..................................17 McGregor v. Louisiana State Univ. Bd. of Supervisors, 3 F.3d 850 (5th Cir. 1993) .................................................................................................4, 5, 6 Meadaa v. K.A.P. Enters., No. CIV.A. 09-1211, 2014 WL 6801636 (W.D. La. Dec. 1, 2014) ........................................19 Montesano v. Seafirst Commercial Corp., 818 F.2d 423, 427 (5th Cir. 1987) .............................................................................................7 N. Am. Capacity Ins. Co. v. Brister’s Thunder Karts, Inc., No. CIV. A. 97-0330, 1998 WL 259966 (E.D. La. May 20, 1998) .........................................18 Nolen v. Nucentrix Broadband Networks Inc., 293 F.3d 926 (5th Cir. 2002) ...................................................................................................18 United States v. Peterson, 244 F.3d 385 (5th Cir. 2001) ...................................................................................................12 Ray v. Karris, 780 F.2d 636 (7th Cir. 1985) ...................................................................................................19 Reves v. Ernst & Young, 507 U.S. 170 (1993) .................................................................................................................10 Robinson v. Standard Mortg. Corp., 191 F. Supp. 3d 630, 639 (E.D. La. 2016) .........................................................................12, 18 S. Snow Mfg. Co. v. SnoWizard Holdings, Inc., 912 F. Supp. 2d 404 (E.D. La. 2012), aff’d, 567 F. App’x 945 (Fed. Cir. 2014) ....................11 Scotsdale Ins. Co. v. Dorman, 153 F.Supp.2d 852 (E.D. La. 2001) .........................................................................................17 Spool v. World Child Int’l Adoption Agency, 520 F.3d 178 (2d Cir. 2008).....................................................................................................17 Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 4 of 27 00407396 iv ActiveUS 161347069v.12 St. Germain v. Howard, 556 F.3d 261 (5th Cir. 2009) .........................................................................................6, 11, 15 Whitney Nat’l Bank v. Med. Plaza Surgical Ctr. L.L.P., No. CIV.A. H–06–1492, 2007 WL 400094, at *4 (S.D. Tex. Feb.1, 2007) ............................18 Williams v. WMX Techs., Inc., 112 F.3d 175 (5th Cir. 1997) .....................................................................................................6 Wilmington Savs. Fund Soc’y FSB v. PHL Variable Ins. Co., 2014 WL 1389974 (D. Del. Apr. 9, 2014) ...............................................................................11 Word of Faith World Outreach Ctr. Church, Inc. v. Sawyer, 90 F.3d 118 (5th Cir. 1996) .....................................................................................................16 State Cases Robertson v. Sun Life Fin., 2009-2275 (La. App. 1 Cir. 6/11/10), 40 So. 3d 507 .................................................................2 State v. Touchet, 1999-1416 (La. App. 3 Cir. 4/5/00), 759 So. 2d 194, 197)......................................................19 Federal Statutes Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. §§ 1961-68 ....................................................................................................................... passim 18 U.S.C. § 1341 ............................................................................................................................12 18 U.S.C. § 1962 ..........................................................................................................10, 11, 15, 19 18 U.S.C. § 2314 ................................................................................................................11, 13, 14 18 U.S.C. § 2315 ..........................................................................................................11, 13, 14, 15 State Statutes Louisiana Code of Civil Procedure Article 591 ...............................................................................3 Louisiana Racketeering Act, La. Rev. Stat.. §§ 15:1351-56 (“LRA”) .................................. passim La. Stat. Ann. § 15:1352 ................................................................................................................19 La. Stat. Ann. § 15:1353 ................................................................................................................19 Rules Fed. R. Civ. P. 9(b) ....................................................................................................................6, 18 Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 5 of 27 00407396 v ActiveUS 161347069v.12 Fed. R. Civ. P. 12(b)(6) ...................................................................................................................6 Fed. R. Civ. P. 15(c) ....................................................................................................................1, 4 Other Authorities Wright & Miller, 6A Fed. Prac. & Proc. Civ. § 1497 (3d ed.) ........................................................5 Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 6 of 27 00407396 1 INTRODUCTION This case arises from Plaintiff’s purchase of a deferred annuity contract from Defendant Sun Life Assurance Company of Canada (U.S.) (“Sun Life”), and the subsequent alleged theft of withdrawal checks by his investment advisor, Matthew Pizzolato (“Matthew”). For eight years, Plaintiff prosecuted this case in Louisiana state court—including two trips to the appeals court— premised on the theory that Sun Life negligently breached the annuity contract by failing to follow industry standards that Plaintiff contended potentially could have prevented Matthew’s alleged misconduct. Plaintiff now seeks to introduce class action allegations, and new theories that include violations of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. §§ 1961-68, and the Louisiana state equivalent, the Louisiana Racketeering Act, La. Stat. Ann. §§ 15:1351-56 (“LRA”). Plaintiff now alleges that Sun Life participated in a criminal enterprise with Matthew and his father, Sherel Pizzolato (“Sherel” and, collectively with Matthew, the “Pizzolatos”), to defraud Plaintiff. Given the federal cause of action and class allegations, Sun Life removed to this court, and now moves to dismiss. The Court should dismiss the RICO and LRA claims pursuant to Federal Rules of Civil Procedure 9(b) and 12(b)(6) for several reasons. First, these claims are long time-barred. Plaintiff knew of the alleged wrongdoing by no later than 2008, so the statutes of limitations ran in 2012 (RICO) and 2013 (LRA). Yet, Plaintiff did not assert his claims until 2017. Rule 15(c) relation back, which would allow the new claims to be treated as if filed in 2008, is inapplicable because Plaintiff’s RICO and LRA claims raise new theories and are based on new allegations, such as the theory that Sun Life knew about the alleged fraud. Second, Plaintiff does not properly allege that Sun Life and the Pizzolatos shared the common purpose required for an association-in-fact criminal enterprise, that the enterprise was Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 7 of 27 00407396 2 separate and apart from the pattern of racketeering, or that Sun Life knew about or participated in the enterprise, as is required to state a RICO claim. Nor does Plaintiff properly allege the required predicate violations of criminal law, or that such violations were part of a pattern of racketeering. Third, Plaintiff cannot maintain a RICO conspiracy claim where, as here, the underlying RICO claim fails. Finally, Plaintiff’s LRA claim fails for the same reasons the RICO claim fails—the required elements of the two statutes are nearly identical. In fact, Plaintiff’s pleading of an LRA claim is even more deficient because he makes no attempt to identify predicate state law violations, as required to state a claim for violation of the LRA. In short, the Court should see this case for what it is: an impermissibly belated attempt to convert a simple case for negligent breach of contract into unsupported and unspecified RICO and class claims, in an overt effort to increase the litigation stakes for Sun Life. The Court should allow Sun Life’s motion and dismiss the RICO and LRA claims. BACKGROUND I. For Eight Years, Plaintiff Prosecuted an Individual Action Premised Upon Sun Life’s Allegedly Negligent Breach of Contract On October 9, 2008, Plaintiff filed a complaint in Louisiana state court asserting state common law claims against three Sun Life entities, Capitol One, Wachovia Bank N.A., and Matthew.1 He alleged that, in or around July 2005, on Matthew’s advice, Plaintiff purchased a Sun Life deferred annuity for $300,000. See First Amend. Pet. ¶¶ 15, 16; Third Amend. Pet. ¶¶ 2-3; Fourth Amend. Pet. ¶ 20. 1 Plaintiff initially sued the wrong entities, but subsequently dismissed them and then named as a defendant Sun Life Assurance Company of Canada (U.S.), the entity that issued the annuity. Wachovia and Matthew never appeared or answered. Defendant Capitol One was dismissed. See Robertson v. Sun Life Fin., 2009-2275 (La. App. 1 Cir. 6/11/10), 40 So. 3d 507, 514-515 (upholding dismissal). Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 8 of 27 00407396 3 Plaintiff further alleged that, on or around October 21, 2005, Sun Life mailed a withdrawal check for $99,999 to Plaintiff’s home address. Pet. ¶ 5. Plaintiff alleged he did not authorize this withdrawal (Pet. ¶ 8), and that Matthew took this check from the mailbox and cashed it without authorization (see Second Amend. Pet. ¶ 5). Thus, Plaintiff alleged that Sun Life breached the annuity contract by not contacting Plaintiff to verify the legitimacy of the withdrawal or to ensure that he received the funds, and by mailing a check instead of sending funds via a wire transfer. See Third Amend. Pet. ¶¶ 4-5. II. In 2017, Plaintiff Drastically Altered His Case On February 16, 2017, Plaintiff amended his complaint to include new and very different allegations and claims, asserting for the first time violations of RICO and the LRA, and seeking to represent a class pursuant to Louisiana Code of Civil Procedure Article 591. See generally Fourth Amend. Pet. Plaintiff now alleges that Matthew’s father, Sherel, was an agent of Sun Life (see Fourth Amend. Pet. ¶ 21), and that Sherel worked with Matthew to make three unauthorized withdrawals of $99,999.99 or less from Plaintiff’s Sun Life annuity in October 2005, January 2006, and November 2007, respectively (see id. at ¶¶ 22-24). Plaintiff asserts that Sun Life was part of a RICO enterprise with the Pizzolatos wherein Sherel (who is not and never has been a defendant) would advise clients to establish retirement accounts with Sun Life and then withdraw money from those accounts and deposit the funds in fictitious accounts the Pizzolatos created. See id. at ¶ 21. This directly contradicts his previous allegation that Sun Life failed to discover the alleged fraud. He further alleges that the enterprise began in July 2005, when Sun Life issued Plaintiff’s annuity contract. See id. at ¶ 23. On March 15, 2017, Sun Life removed the case to this court. That same day, the Court entered the Eastern District of Louisiana’s RICO Standing Order, requiring Plaintiff to file a statement describing the basis for his RICO claim with specificity (“RICO Statement”). Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 9 of 27 00407396 4 Plaintiff’s RICO Statement alleges additional facts, some of which contradict his pleadings. For example, the First Amended Petition states that Matthew put Robertson into the Sun Life annuity. First Amend. Pet. ¶¶ 15-16. By contrast, the RICO Statement asserts that Robertson met with Sherel, who recommended the Sun Life annuity. See RICO Statement ¶ 6(i). The RICO Statement also alleges, apparently relying on the letters “SLG” appearing in Sherel’s fax header, that Sherel’s office was also Sun Life’s office.2 See id. ARGUMENT I. Plaintiff’s RICO and LRA Claims Are Time Barred The statute of limitations for federal RICO claims is four years. See Agency Holding Corp. v. Malley-Duff & Assocs., Inc., 483 U.S. 143, 156 (1987). The LRA statute of limitations is five years. La. Rev. Stat. 15:1356(H). Plaintiff alleges that he became aware of the alleged wrongful conduct in July 2008. Pet. ¶ 9. Therefore, he had until no later than July 2012 to file his RICO claim and July 2013 to file his LRA claim. However, he filed his RICO and LRA claims in February 2017. Therefore, the claims are barred on the face of the Fourth Amended Petition. Relation back does not salvage the claims. Rule 15(c) provides in relevant part: “[a]n amendment to a pleading relates back to the date of the original pleading when the amendment asserts a claim or defense that arose out of the conduct, transaction, or occurrence set out—or attempted to be set out—in the original pleading.” Fed. R. Civ. P. 15(c)(1)(B). However, “[t]he [] amended complaint will not relate back if it asserts new or distinct conduct, transactions, or occurrences as the basis for relief.” McGregor v. Louisiana State Univ. Bd. of Supervisors, 3 2 Sun Life has never used “SLG” as an acronym for its business. Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 10 of 27 00407396 5 F.3d 850, 863 (5th Cir. 1993) (citing Holmes v. Greyhound Lines, Inc., 757 F.2d 1563, 1566 (5th Cir. 1985)). Thus, Wright & Miller explains: [T]he standard for determining whether amendments qualify under Rule 15(c) is not simply an identity of transaction test. Although not expressly mentioned in the rule, the courts also inquire into whether the opposing party has been put on notice regarding the claim or defense raised by the amended pleading. . . . . But if the alteration of the original pleading is so substantial that it cannot be said that defendant was given adequate notice of the conduct, transaction, or occurrence that forms the basis of the new claim or defense, then the amendment will not relate back and will be time barred if the limitations period has expired. Thus, a failure of notice will prevent relation back. Wright & Miller, 6A Fed. Prac. & Proc. Civ. § 1497 (3d ed.). “The test is whether the original complaint apprised the [defendant] of the [new] claims set forth in the [] amended complaint.” McGregor, 3 F.3d at 864. Until the Fourth Amended Petition, Plaintiff alleged only that Sun Life had failed to use what he claimed were “normal industry standards” to discover Matthew’s alleged misconduct concerning a single unauthorized withdrawal check. See Third Amend. Pet. ¶ 4. The parties litigated for eight years—including motions to dismiss, summary judgment motions, and two trips to the state appeals court—based solely on this theory. The Fourth Amended Petition now seeks to assert that (1) Sun Life was a knowing and active member of a RICO enterprise established to defraud Plaintiff, (2) Sherel, who was unmentioned in any prior pleading, was also a participant in the enterprise, (3) Sherel acted as Sun Life’s agent in the alleged scheme, and (4) Sun Life is responsible for defrauding Plaintiff of $300,000, not just one $99,999 check. None of Plaintiff’s prior pleadings put Sun Life on notice of any of these claims or alleged facts. Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 11 of 27 00407396 6 In short, Robertson’s “amendment attempted to add a new legal theory unsupported by factual claims raised in the original complaint.” McGregor, 3 F.3d at 864. As a result, the claims do not relate back to the initial petition, and the statute of limitations ran long ago. II. Plaintiff Fails To State a RICO Claim and To Meet Governing Pleading Requirements Plaintiff also has not properly pleaded the elements of a RICO claim in accordance with Rule 9(b) and Rule 12(b)(6). Because the claim rests on allegations of fraud, the Fourth Amended Petition must satisfy Rule 9(b)’s heightened pleading requirements. Williams v. WMX Techs., Inc., 112 F.3d 175, 177 (5th Cir. 1997) (“Fed. R. Civ. P. 9(b) applies to . . . RICO claims resting on allegations of fraud.”). Rule 9(b) requires that “a party . . . state with particularity the circumstances constituting fraud.” Fed. R. Civ. P. 9(b). Courts in the Fifth Circuit “interpret[] Rule 9(b) strictly, requiring the plaintiff to ‘specify the statements contended to be fraudulent, identify the speaker, state when and where the statements were made, and explain why the statements were fraudulent.’” Flaherty & Crumrine Preferred Income Fund, Inc. v. TXU Corp., 565 F.3d 200, 207 (5th Cir. 2009) (quoting Williams, 112 F.3d at 177). RICO claims “have three common elements: ‘(1) a person who engages in (2) a pattern of racketeering activity, (3) connected to the acquisition, establishment, conduct, or control of an enterprise.” St. Germain v. Howard, 556 F.3d 261, 263 (5th Cir. 2009) (quoting Abraham v. Singh, 480 F.3d 351, 355 (5th Cir. 2007) (emphasis added)). Here, the Fourth Amended Petition and RICO Statement fail to allege (i) Sun Life’s participation in a RICO enterprise, or (ii) a pattern of racketeering activity. A. Plaintiff Fails to Allege the Existence of a Criminal “Enterprise” To establish an association-in-fact enterprise and avoid dismissal, Robertson must properly plead: (1) the existence of an enterprise “separate and apart from the pattern of Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 12 of 27 00407396 7 racketeering,” (2) that is an “ongoing organization,” (3) with members that “function as a continuing unit as shown by a hierarchical or consensual decision making structure.” Delta Truck & Tractor, Inc. v. J.I. Case Co., 855 F.2d 241, 243 (5th Cir. 1988). An association-in-fact RICO enterprise is “a continuing unit that functions with a common purpose.” Boyle v. United States, 556 U.S. 938, 948 (2009). Here, Plaintiff’s allegations with respect to the enterprise element of a RICO claim are conclusory and unsupported by well-pleaded facts. Plaintiff fails to allege that Sun Life and the Pizzolatos were involved in an enterprise that was “separate and apart from the pattern of racketeering.” Delta, 855 F.2d at 243; see also Elliott v. Foufas, 867 F.2d 877, 881 (5th Cir. 1989) (association must have “existed for any purpose other than to commit the predicate offenses.”). Plaintiff has not alleged a purpose for which the enterprise existed other than to commit the predicate offenses and, as such, fails to satisfy the separateness requirement under RICO. Relatedly, Plaintiff has also failed to allege that defendants were part of an “ongoing organization.” Delta, 855 F.2d at 243. “[I]ndividuals who join together for the commission of one discrete criminal offense have not created an ‘association-in-fact’ enterprise, even if they commit two predicate acts during the commission of this offense, because their relationship to one another has no continuity.” Manax v. McNamara, 842 F.2d 808, 811 (5th Cir.1988) (quoting Montesano v. Seafirst Commercial Corp., 818 F.2d 423, 427 (5th Cir. 1987) (internal quotation omitted). Here, Plaintiff alleges that the enterprise began only after he entered into the annuity contract with Sun Life and he does not allege that the enterprise continued after Plaintiff’s account was emptied. Fourth Amend. Pet. ¶ 23. Thus, Plaintiff has not alleged that the enterprise existed before or continued after Plaintiff was defrauded and, therefore, he has not alleged the continuity required to establish a RICO enterprise. Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 13 of 27 00407396 8 Moreover, there are no facts alleged that indicate Sun Life shared any common purpose whatsoever with the Pizzolatos. Sun Life is alleged to have “solicited Mr. Robertson by mail in 2005,” “advised Mr. Robertson to empty his Merrill Lynch retirement fund into a Sun Life annuity,” “obtained all of Mr. Robertson’s personal retirement funds,” (RICO Statement ¶ 6(g)) “issued a contract to set up an index value annuity for Robertson,” (id. at ¶ 6(j)), “approved, permitted, and created transactions from Mr. Robertson’s retirement account in a repeated pattern of withdrawals in amounts of $99,999.99 or less” (id. at ¶ 6(m)), and collected a penalty for withdrawing money from the annuity (id. at ¶ 5(a)).3 These allegations are consistent with the solicitation of lawful business and the issuance and administration of Sun Life’s financial products. The facts as alleged only support an intent to defraud on the part of the Pizzolatos, who allegedly sought to invest Plaintiff’s money “in fraudulent companies and Ponzi schemes.” Compl. ¶ 6(k). These are “divergent goals” sufficient to defeat the common purpose requirement. See Baker v. IBP, Inc., 357 F.3d 685, 691 (7th Cir. 2004). Even Plaintiff’s own filings, until the most recent petition, alleged that Sun Life did not share a purpose with the Pizzolatos. See First Amend. Pet. ¶ 18 (“These named defendants except for Pizzoloto [sic] are liable to plaintiffs [sic] for their failure to monitor the activities of their customers which if they had done so in a normal and customary fashion would have put them on notice that something was amiss in the activities of defendant, Pizzoloto [sic] in time to stop his activities to warn plaintiff.”). Plaintiff also fails to explain how Sun Life knew about the allegedly fraudulent activity or why it would have had any reason to know. See, e.g., United States v. Manzella, 782 F.2d 533, 538 (5th Cir. 1986) (“To prevent unjust association with the crimes of others, however, we 3 With respect to the withdrawal penalty, Plaintiff does not contend it was unlawful or in violation of the annuity contract. Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 14 of 27 00407396 9 required the government to show that each defendant had some knowledge of the enterprise’s nature.”). Some of Plaintiff’s allegations regarding Sun Life’s knowledge are wholly conclusory. See RICO Statement ¶ 5(a) (“Sun Life’s actions were intentional and done with actual knowledge.... Sun Life acted with reckless disregard and indifference.”). Others are implausible and irrelevant. See RICO Statement ¶ 6(h) (discussing “shared” office space).4 And still others claim that the Pizzolatos took affirmative steps to prevent Sun Life from discovering their alleged misconduct. See, e.g., RICO Statement ¶ 6(m) (alleging that withdrawal amount of $99,999.99 “chosen as a way to avoid the $100,000 threshold that would automatically receive greater scrutiny” by Sun Life). These allegations do not come close to establishing that Sun Life knew about the Pizzolatos’ alleged fraud, much less that Sun Life shared a common purpose with the Pizzolatos.5 Indeed, for many years, this case was premised on the notion that Sun Life did not know of the alleged fraud. The initial Petition for Damages alleged that Sun Life negligently allowed Matthew to gain possession of the check sent in October 2005. Pet. ¶ 10. After the court dismissed the negligence claim, Plaintiff’s Third Amended Petition alleged breach of contract 4 It is unclear what Plaintiff means by “Sun Life’s offices.” The description seems to arise principally from Plaintiff’s allegation that “the repeated withdrawals and transfers from Mr. Robertson’s account took place at Sun Life’s offices in Covington, Louisiana which was also the office of Sherel Pizzolato, Matthew Pizzolato, and other entities formed or controlled by the Pizzolatos.” RICO Statement ¶ 6(h). However, a broker’s alleged use of a space to meet with a client and recommend a Sun Life product that ultimately issues does not offer a basis to conclude that the space was “Sun Life’s offices.” 5 Similarly, Plaintiff alleges that “[i]f not knowledgeable to all the racketeering activity, Sun Life acted with reckless disregard and indifference of its duties and obligations as a financial advisor and institution as Sun Life made multiple false statements and consciously avoided learning the truth about Robertson’s account set up, withdrawals, ‘penalties,’ and advice.” RICO Statement ¶ 5(a). Plaintiff also claims that Sun Life “fail[ed] to monitor the activities of their customers” (First Amend. Pet. ¶ 18) and failed to use “normal industry standards” to discover misconduct (Third Amend. Pet. ¶ 4). None of these broad, generalized statements sets forth sufficient facts which, if taken as true, would establish reckless or conscious disregard of the alleged fraud. As explained above, Plaintiff has not stated how or why Sun Life would have had reason to suspect criminal activity, or what Sun Life failed to do that would have alerted it to misconduct. In fact, Plaintiff alleges that all of the withdrawals were less than the $100,000 threshold that would have signaled possible misconduct. RICO Statement ¶ 6(m). Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 15 of 27 00407396 10 arising from failure to discover misconduct. Third Amend. Pet. ¶ 4; see also First Amend. Pet. ¶ 18. B. Plaintiff Fails to Allege That Sun Life Conducted or Participated in the Enterprise, as Required by § 1962(c) No pleaded facts indicate that Sun Life conducted or participated in the alleged enterprise, as required by § 1962(c) (it is “unlawful for any person employed by or associated with any enterprise . . . to conduct or participate, directly or indirectly, in the conduct of such enterprise’s affairs through a pattern of racketeering activity[.]”). The U.S. Supreme Court has interpreted “conduct or participate” to mean that “one has participated in the operation or management of the enterprise itself.” Reves v. Ernst & Young, 507 U.S. 170, 183 (1993). “Operation or management” requires more than being unknowingly implicated in another’s fraudulent scheme. It requires some purposeful action in furtherance of the unlawful conduct. See id. at 179 (“Once we understand the word ‘conduct’ to require some degree of direction and the word ‘participate’ to require some part in that direction, the meaning of § 1962(c) comes into focus. In order to ‘participate, directly or indirectly, in the conduct of such enterprise’s affairs,’ one must have some part in directing those affairs.”); see also Boyle, 556 U.S. at 953-54 (“It is not enough for a defendant to ‘carry on’ or ‘participate in’ an enterprise’s affairs through a pattern of racketeering activity; instead, evidence that he operated, managed, or directed those affairs is required. This requirement confirms that the enterprise element demands evidence of a certain quantum of businesslike organization—i.e., a system of processes, dealings, or other affairs that can be ‘directed.’” (citations omitted)). Here, Plaintiff has not alleged that Sun Life had any control or direction over the affairs of the enterprise. Instead, the actions allegedly taken by Sun Life are consistent with the issuance and administration of Sun Life’s financial products. Plaintiff does not allege that Sun Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 16 of 27 00407396 11 Life had any contact or affiliation whatsoever with Matthew. Plaintiff’s allegations with respect to Sherel amount to a conclusory statement that Sherel was Sun Life’s agent, without any supporting factual allegations or support under the law.6 In short, simply issuing an annuity from which money was allegedly fraudulently withdrawn cannot be the basis for RICO liability. C. Plaintiff Fails to Allege a “Pattern of Racketeering Activity” A RICO plaintiff must also allege that the defendant engaged in a “pattern of racketeering activity.” See 18 U.S.C. § 1962(c). “A pattern of racketeering activity consists of two or more predicate criminal acts that are (1) related and (2) amount to or pose a threat of continued criminal activity.” St. Germain, 556 F.3d at 263. Plaintiff “must plead a set of facts sufficient to plausibly establish” those acts. S. Snow Mfg. Co. v. SnoWizard Holdings, Inc., 912 F. Supp. 2d 404, 420 (E.D. La. 2012), aff’d, 567 F. App’x 945 (Fed. Cir. 2014). The predicate acts must be performed by the defendant, not other members of the enterprise. See Dooley v. United Techs. Corp., 803 F. Supp. 428, 440 (D.D.C. 1992) (plaintiff “must allege that each defendant participated in the conduct of an enterprise through a pattern of racketeering activity” (emphasis added)). Here, Plaintiff fails to allege two or more predicate acts committed by Sun Life, or that they formed a pattern. 1. Plaintiff Fails to Allege Two Predicate Acts Plaintiff alleges as predicate acts violations of three statutory provisions: mail fraud, see 18 U.S.C. § 1341 and two sections of the National Stolen Property Act, see 18 U.S.C. §§ 2314, 2315. But these claims are unsupported by the particularized factual allegations required. a) Plaintiff Has Not Sufficiently Alleged That Sun Life Is Liable For Mail Fraud 6 The paying of a commission to an insurance broker alone is not sufficient to establish a RICO association-in-fact. See Wilmington Savs. Fund Soc’y FSB v. PHL Variable Ins. Co., 2014 WL 1389974, at *6 (D. Del. Apr. 9, 2014) (“Other than the paying of commissions to the third party agents at the time of sale, the Plaintiffs point to no viable relationship between the third party agents and [the insurer].”). Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 17 of 27 00407396 12 The elements of mail fraud under 18 U.S.C. § 1341 are: “(1) a scheme to defraud; (2) use of the mails to execute the scheme; and (3) the specific intent to defraud.” United States v. Peterson, 244 F.3d 385, 389 (5th Cir. 2001); see also Robinson v. Standard Mortg. Corp., 191 F. Supp. 3d 630, 639 (E.D. La. 2016) (citing same standard in civil RICO case). Here, Plaintiff’s “vague, general allegations are plainly insufficient to state a plausible claim for relief.” Robinson, 191 F. Supp. 3d at 640. He simply asserts that “Sun Life made multiple false statements.” RICO Statement ¶ 5(a). He does not, however, identify any such statement or specify the time, place, or contents thereof. Nor does he explain why the statements were false. The allegation that “Sun Life’s actions and omissions were documented in written statements sent through the U.S. Mail” is equally lacking in specificity. Id. at ¶ 5(c). Similarly, Plaintiff claims that Sun Life “solicited [him] by mail in 2005” and “advised [him] to empty his Merrill Lynch retirement fund into a Sun Life annuity.” Id. at ¶ 6(g). But he does not describe (1) the content of the initial solicitation, (2) when it was received, (3) or whether it had any causal relationship to Plaintiff’s purchase of the annuity. He also fails to demonstrate that Sun Life’s alleged advice contained any misrepresentations.7 Indeed, even as to Sherel, Plaintiff fails to identify an instance of mail fraud. Plaintiff alleges that he had a meeting with Sherel on July 15, 2005, during which Sherel recommended that Plaintiff purchase a “Single Premium Equity Indexed Deferred Annuity.” RICO Statement ¶ 6(i). This description fails to identify any alleged misrepresentations or explain why those statements were false. Moreover, this description is inconsistent with the allegation in the First Amended Petition that Matthew (not Sherel) convinced Plaintiff to purchase the annuity. First 7 It is clear why Plaintiff is unable to identify a fraudulent statement by Sun Life—that allegation would be incompatible with the case that Plaintiff has prosecuted for nearly eight years. All of Plaintiff’s prior Petitions for Damages have emphasized that Matthew was responsible for the allegedly deceptive conduct. See, e.g., First Amend. Pet. ¶¶ 15-17. Plaintiff’s allegations against Sun Life asserted only that it had failed to use “normal industry standards” to discover misconduct. See Third Amend. Pet. ¶ 4. Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 18 of 27 00407396 13 Amend. Pet. ¶¶ 15-17. These earlier allegations undermine the plausibility of Plaintiff’s new and contradictory allegations with respect to Sherel. See Fasugbe v. Williams, No. CIV. 2:10-2320 WBS, 2011 WL 2119128, at *5 (E.D. Cal. May 26, 2011) (noting that courts “may properly consider the plausibility of” amended pleadings “in light of . . . prior allegations”). Finally, Plaintiff’s allegations are also inconsistent with the notion that any alleged mail solicitations or sales meetings constitute part of a fraud. The RICO statement alleges that the fraudulent “scheme and enterprise to recommend and assist [Robertson] . . . into withdrawing funds from the Sun Life products and then placing them in fraudulent companies and Ponzi schemes,” began after he purchased the Sun Life annuity. RICO Statement ¶ 6(k). This suggests that the alleged fraud had not even occurred at the time of the alleged solicitation and sales meetings. Thus, Plaintiff has failed to plead mail fraud as a predicate act. b) Plaintiff Has Not Plausibly Alleged That Sun Life Is Liable For a Violation of the National Stolen Property Act Plaintiff also asserts that Sun Life violated two sections of the National Stolen Property Act, 18 U.S.C. §§ 2314, 2315. To plausibly allege a violation of § 2314, Plaintiff must show that Sun Life “transport[ed], transmit[ed], or transfer[ed] in interstate or foreign commerce any goods, wares, merchandise, securities or money, of the value of $5,000 or more, knowing the same to have been stolen, converted or taken by fraud.” 18 U.S.C. § 2314. Plaintiff never identifies what action Sun Life took knowingly to transfer stolen property. To the extent Plaintiff’s claim is based on Matthew’s allegedly unauthorized withdrawal of $99,999.99 from the Sun Life annuity in October 2005, see Pet. ¶¶ 5, 8-10, Plaintiff has not alleged how Sun Life knew the check it sent—to Robertson’s address—had been requested in Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 19 of 27 00407396 14 reliance on fraudulent misrepresentations. As described above, many of Plaintiff’s allegations regarding Sun Life’s actions are largely conclusory, implausible, or irrelevant. Moreover, far from alleging intent, a fair reading of the RICO Statement shows that the alleged scheme was structured so that Sun Life would not discover the Pizzolatos’ misconduct. Plaintiff alleges that the Pizzolatos took affirmative steps to prevent Sun Life from learning that the withdrawals were out of the ordinary. RICO Statement ¶ 6(m) (withdrawal amount of $99,999.99 was chosen “as a way to avoid the $100,000 threshold that would automatically receive greater scrutiny” from Sun Life).8 Plaintiff fares no better alleging a violation of § 2315. To plausibly allege a violation of § 2315, Plaintiff must show that Sun Life received, possessed, concealed, stored, bartered, sold, or disposed “of any goods, wares, or merchandize, securities, or money of the value of $5,000 of more . . . which may have crossed a State or United States boundary after being stolen, unlawfully converted, or taken, knowing the same to have been stolen, unlawfully converted, or taken.” 18 U.S.C. § 2315. In addition to the reasons just stated, Plaintiff’s claim under § 2315 fails because he has made no effort to allege that Sun Life engaged in any of the enumerated acts after the goods at issue were stolen, unlawfully converted, or taken. Insofar as this claim is based on the check sent in October 2005, Plaintiff has made clear his belief that the check was taken from his mailbox after it arrived. Second Amend. Pet. ¶ 5. Finally, even if Plaintiff’s claims against Sun Life under §§ 2314 and 2315 are based on the conclusory and unsupported allegation that Sherel was an agent of Sun Life, they would still fail. The claim under § 2314 falls flat because Plaintiff has not alleged that Sherel sent in 8 The conclusion that Sun Life knew about the fraud is also refuted by the Petitions for Damages on which this case was based for eight years, which did not allege that Sun Life had any knowledge of the alleged fraud. See Pet. ¶ 10 (setting forth negligence claim); Third Amend. Pet. ¶ 4 (alleging breach of contract arising from failure to use normal industry standards to discover alleged fraud). Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 20 of 27 00407396 15 interstate commerce anything of value that was stolen, converted, or procured by fraud. The claim under § 2315 is similarly unavailing. Plaintiff alleges that the October 2005 check was “removed” from his mailbox “by Matthew Pizzolato and/or an agent of Matthew Pizzolato,” forged by Matthew Pizzolato, and cashed by Capitol One Bank. Second Amend. Pet. ¶ 5. Absent from this recitation is any indication that Sherel had any role in this conduct. Because Plaintiff has failed to sufficiently allege even one RICO predicate act, his claim under § 1962(c) must be dismissed. 2. Plaintiff Has Not Satisfied the “Pattern” Requirement Even assuming Robertson had successfully alleged two predicate acts—which he has not—he still would not have alleged a “pattern of racketeering activity.” At most, he alleges a single instance of fraud. That is insufficient to plead RICO liability. “A pattern of racketeering activity consists of two or more predicate criminal acts that are (1) related and (2) amount to or pose a threat of continued criminal activity.” St. Germain v. Howard, 556 F.3d 261, 263 (5th Cir. 2009). However, “[t]he statement that a pattern ‘requires at least’ two predicates implies ‘that while two acts are necessary, they may not be sufficient.’” H.J. Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 237 (1989) (citations omitted). As the Fourth Circuit succinctly explained: If the commission of two or more “acts” to perpetrate a single fraud were held to satisfy the RICO statute, then every fraud would constitute “a pattern of racketeering activity.” It will be the unusual fraud that does not enlist the mails and wires in its service at least twice. Such an interpretation would thus eliminate the pattern requirement altogether. Int’l Data Bank, Ltd. v. Zepkin, 812 F.2d 149, 154-55 (4th Cir. 1987). Even when the alleged criminal activity consists of multiple actions, it does not follow that those actions constitute a pattern. When the alleged actions all relate to a single goal, accomplished in a short period of time, the pattern requirement is not satisfied. See id. For example, in In re Burzynski, the Fifth Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 21 of 27 00407396 16 Circuit Court of Appeals held that plaintiff’s alleged predicate acts lacked continuity, and therefore a pattern, because the acts all occurred in the defense of a single lawsuit, which “did not constitute or threaten long-term criminal activity.” 989 F.2d 733, 742-43 (5th Cir. 1993) (citing Delta Truck & Tractor, Inc. v. J.I. Case Co., 855 F.2d 241 (5th Cir. 1988), for the proposition that there is no continuity where “multiple acts of fraud . . . were part and parcel of a single, discrete and otherwise lawful commercial transaction.”). Here, viewing Plaintiff’s allegations in the most favorable light possible, he has alleged that either Sherel or Matthew convinced him to purchase an annuity from Sun Life (an inherently lawful transaction), then fraudulently converted the funds after submitting unauthorized requests for withdrawals. Even assuming that Plaintiff had adequately alleged Sun Life knew of and intentionally participated in the withdrawals of funds from the annuity, those alleged withdrawals are “part and parcel of [the] single, otherwise lawful transaction”— namely administration of Plaintiff’s annuity account. The alleged fraud amounts to a scheme to empty Plaintiff’s annuity account and the withdrawals were all executed to accomplish that one, limited objective. Once that goal was achieved, there was no threat of continued criminal activity. This single alleged fraud on a single victim is insufficient to plead a continuing “pattern” of wrongdoing on the part of Sun Life.9 See Atel Mar. Inv’rs, LP v. Sea Mar Mgmt., L.L.C., No. CIV.A. 08-1700, 2012 WL 2994337, at *9 (E.D. La. July 20, 2012) (holding that plaintiff’s allegation that defendants engaged in “various acts of mail and wire fraud” were insufficient to 9 Plaintiff’s conclusory allegations concerning other “victims” does not alter this analysis. See RICO Statement ¶ 20. Plaintiff provides no facts to support his assertion that the Desselles were victims of the same alleged racketeering activity. He provides no description of their claim or even the time period underlying their claim, nor any explanation of how Sun Life was allegedly involved. “Pleading the mere existence of lawsuits is not the same as pleading the facts that demonstrate predicate illegal acts as the defendant’s regular way of doing business. [Plaintiff] has not in this respect sufficiently alleged a continued threat of illegal activity by [Defendant].” Word of Faith World Outreach Ctr. Church, Inc. v. Sawyer, 90 F.3d 118, 124 (5th Cir. 1996). Indeed, the case caption identified in the RICO Statement makes no mention of Sun Life as a defendant in the Desselles case. Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 22 of 27 00407396 17 establish a pattern of racketeering activity because the alleged acts were part of a single, lawful transaction related to chartering of vessels); Scotsdale Ins. Co. v. Dorman, 153 F.Supp.2d 852, (E.D. La. 2001) (holding that plaintiff failed to establish a pattern of racketeering activity when all alleged predicate acts of mail and wire fraud were part of a single fraudulent scheme, carried out against one insurer over a period of six months, and intended to achieve the specific goal of avoiding payment for medical expenses). Moreover, the length of time of the Pizzolatos’ alleged scheme was too short to satisfy RICO’s continuity requirement. Plaintiff asserts that his account was “depleted . . . to nothing within two years.” See RICO Statement ¶ 6(l). RICO only addresses “activities that amount to, or threaten, long-term criminal activity.” H.J. Inc., 492 U.S. at 243 n.4. Indeed, the Second Circuit has determined that alleged frauds lasting less than two years will not satisfy the pattern requirement. See, e.g., Spool v. World Child Int’l Adoption Agency, 520 F.3d 178, 184-85 (2d Cir. 2008) (stating that “[a]lthough we have not viewed two years as a bright-line requirement, it will be rare that conduct persisting for a shorter period of time establishes closed-ended continuity”). Here, the brevity of Sun Life’s alleged wrongdoing, combined with the limitation of the allegations to a single fraud allegedly perpetrated on a single victim, mean that Plaintiff has not satisfied the continuity requirement. See Calcasieu Marine Nat. Bank v. Grant, 943 F.2d 1453, 1464 (5th Cir. 1991) (“Short-term criminal conduct is not the concern of RICO.”). Finally, Plaintiff cannot forestall dismissal by asserting that Sherel acted as Sun Life’s agent for all purposes, such that Sherel’s liability is Sun Life’s liability. Plaintiff has not pleaded any facts supporting that allegation, let alone satisfied the requirement to plead facts establishing the agency relationship with particularity. See, e.g., Marcotte v. Bank of Am., No. CIV.A. H-14- 2773, 2015 WL 2184369, at *5 (S.D. Tex. May 11, 2015) (“When, as here, the issue is whether Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 23 of 27 00407396 18 an entity is liable as the principal of the person who allegedly made the fraudulent statements, the plaintiffs must ‘plead with the particularity required under Rule 9(b) facts showing that when [the alleged agent] had [the plaintiff] sign the ... loan and guaranty documents, [the alleged agent] acted as [the defendant’s] actual or apparent agent.’” (quoting Whitney Nat’l Bank v. Med. Plaza Surgical Ctr. L.L.P., No. CIV.A. H–06–1492, 2007 WL 400094, at *4 (S.D. Tex. Feb.1, 2007)); cf., Lachmund v. ADM Investor Servs., Inc., 191 F.3d 777, 783 (7th Cir.1999) (“[W]hen the plaintiff relies upon the same circumstances to establish both the alleged fraud and the agency relationship of a defendant, the reasons for more particularized pleading that animate Rule 9(b) apply with equal force to the issue of agency and to the underlying fraud claim.”); N. Am. Capacity Ins. Co. v. Brister’s Thunder Karts, Inc., No. CIV. A. 97-0330, 1998 WL 259966, at *4 (E.D. La. May 20, 1998) (citing four factors used to determine whether broker was agent of insurer under Louisiana law, including requirement that insurer have control over alleged agent). Thus, Plaintiff has not successfully alleged a pattern of racketeering activity. III. Plaintiff Fails to Allege a RICO Conspiracy Under 18 U.S.C. § 1962(d), it is unlawful to engage in a conspiracy to violate § 1962(c). A plaintiff who fails to plausibly allege the elements of a § 1962(c) violation cannot plead a conspiracy to violate that section. Nolen v. Nucentrix Broadband Networks Inc., 293 F.3d 926, 930 (5th Cir. 2002). Because Plaintiff has failed to establish that Sun Life violated § 1962(c), his conspiracy claim necessarily fails. See Robinson v. Standard Mortg. Corp., 191 F. Supp. 3d 630, 646 (E.D. La. 2016) (“Because [the plaintiff’s] allegations fail to state a substantive RICO claim upon which relief may be granted, her conspiracy claim fails as well.”). Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 24 of 27 00407396 19 IV. Plaintiff Fails to State a Claim Under the LRA The arguments that support dismissing Plaintiff’s RICO claim apply with equal reason to his claim under the LRA. The language of the two statutes is nearly identical.10 And “[b]ecause Louisiana’s Racketeering Act is modeled on federal RICO legislation, federal decisions regarding RICO are persuasive when interpreting the state law.” Meadaa v. K.A.P. Enters., No. CIV.A. 09-1211, 2014 WL 6801636, at *6 (W.D. La. Dec. 1, 2014) (citing State v. Touchet, 1999-1416 (La. App. 3 Cir. 4/5/00), 759 So. 2d 194, 197). First, Plaintiff’s LRA claim must be dismissed because he does not sufficiently allege a criminal enterprise involving Sun Life and the Pizzolatos. See Touchet, 759 So. 2d at 197 (applying, in case involving criminal prosecution under the LRA, Fifth Circuit standard for determining whether association-in-fact exists). See supra Argument, Section II.A. Second, Plaintiff’s claim fails because he has not sufficiently alleged an LRA predicate act. Like RICO, the LRA requires plaintiffs to establish “a pattern of racketeering activity,” which is defined as “at least two incidents of racketeering activity.” La. Stat. Ann. §§ 15:1352(C), 15:1353(C). The definition of “racketeering activity,” in turn, includes a list of over 60 predicate acts. See La. Stat. Ann. § 15:1352(A). As a threshold matter, Plaintiff does not specify which predicate or predicate acts Sun Life is alleged to have committed under state law. That alone is sufficient to dismiss the LRA claim. See Ray v. Karris, 780 F.2d 636, 645 (7th Cir. 1985) (“A complaint is not sufficient if it does not specify the nature of the predicate acts to a 10 Compare 18 U.S.C. § 1962(c) (it is “unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise’s affairs through a pattern of racketeering activity . . .”), with La. Stat. Ann. § 15:1353(C) (“It is unlawful for any person employed by, or associated with, any enterprise knowingly to conduct or participate in, directly or indirectly, such enterprise through a pattern of racketeering activity.”). Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 25 of 27 00407396 20 degree that will allow the defendants to comprehend the specific acts to which they are required to answer.”). Accordingly, the Court should dismiss Plaintiff’s LRA claim. CONCLUSION For the foregoing reasons, pursuant to Federal Rules of Civil Procedure 9(b) and 12(b)(6), Sun Life respectfully requests that this Court dismiss Plaintiff’s claims under 18 U.S.C. § 1962 and Louisiana Revised Statutes §§ 15:1351-1356. DATED: April 12, 2017 /s/ Edward W. Trapolin Edward W. Trapolin (#27667) Kelly Juneau Rookard (#30573) Irwin Fritchie Urquhart & Moore, LLC 400 Poydras Street, Suite 2700 New Orleans, Louisiana 70130 Telephone: (504) 310-2100 Facsimile: (504) 310-2101 Andrea J. Robinson (pro hac vice) Timothy J. Perla (pro hac vice) Ian D. Coghill (pro hac vice) Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, Massachusetts 02109 Telephone: (617) 526-6000 Facsimile: (617) 526-5000 Attorneys for Sun Life Assurance Company of Canada (U.S.) Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 26 of 27 00407396 21 CERTIFICATE OF SERVICE I hereby certify that, on April 12, 2017, the foregoing was filed electronically with the Clerk of Court using the CM/ECF system. Notice of this filing will be sent to all counsel of record by operation of the Court’s electronic filing system. /s/ Edward W. Trapolin Case 2:17-cv-02148-SSV-JVM Document 23-1 Filed 04/12/17 Page 27 of 27 00407397 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA LEVI E. ROBERTSON, on behalf of himself and all others similarly situated, Plaintiff, v. SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.), WACHOVIA BANK, N.A., and MATTHEW PIZZOLATO, Defendants No. 2:17-CV-02148 SECTION: “R” DIVISION: 1 JUDGE: SARAH S. VANCE MAGISTRATE JUDGE: JANIS VAN MEERVELD DEFENDANT SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)’S NOTICE OF SUBMISSION Please take notice that defendant Sun Life Assurance Company of Canada (U.S.) will submit for consideration its motion to dismiss under Federal Rules of Civil Procedure 9(b) and 12(b)(6) before the Honorable Sarah S. Vance at 10:00 a.m. on June 7, 2017. DATED: April 12, 2017 /s/ Edward W. Trapolin Edward W. Trapolin (#27667) Kelly Juneau Rookard (#30573) Irwin Fritchie Urquhart & Moore, LLC 400 Poydras Street, Suite 2700 New Orleans, Louisiana 70130 Telephone: (504) 310-2100 Facsimile: (504) 310-2101 Andrea J. Robinson (pro hac vice) Timothy J. Perla (pro hac vice) Ian D. Coghill (pro hac vice) Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, Massachusetts 02109 Telephone: (617) 526-6000 Facsimile: (617) 526-5000 Case 2:17-cv-02148-SSV-JVM Document 23-2 Filed 04/12/17 Page 1 of 2 00407397 Attorneys for Sun Life Assurance Company of Canada (U.S.) CERTIFICATE OF SERVICE I hereby certify that, on April 12, 2017, the foregoing was filed electronically with the Clerk of Court using the CM/ECF system. Notice of this filing will be sent to all counsel of record by operation of the Court’s electronic filing system. /s/ Edward W. Trapolin __________________________________ Case 2:17-cv-02148-SSV-JVM Document 23-2 Filed 04/12/17 Page 2 of 2