SCOTUS decision for fired trucker could create 'quite a mess' of RICO personal injury cases, dissent says
A truck driver fired for having THC in his system after taking a product said to be free of the substance can seek triple damages under the Racketeer Influenced and Corrupt Organizations Act even if the alleged business damage stemmed from a personal injury, the U.S. Supreme Court ruled Wednesday.
The Supreme Court ruled 5-4 for Douglas Horn, who said the company Medical Marijuana Inc. did not disclose that the CBD product that he took for his pain also contained THC, a psychoactive marijuana ingredient that turned up when he was selected for random drug screening.
Horn’s lawsuit had alleged that Medical Marijuana was a RICO enterprise engaging in mail and wire fraud through its marketing, distribution and sales of Dixie X, the supplement that he took. He sought triple damages under a RICO provision allowing suits for “any person injured in his business or property.”
The Supreme Court rejected the “antecedent-personal-injury bar,” adopted by some federal appeals courts, which prohibits RICO suits for business or property losses caused by personal injury.
Justice Amy Coney Barrett wrote the majority opinion, joined by Justice Sonia Sotomayor, Justice Elena Kagan, Justice Neil Gorsuch and Justice Ketanji Brown Jackson.
In a dissent, Justice Brett Kavanaugh warned that the aftermath of the majority opinion “could be quite a mess, as courts grapple with RICO personal injury cases where the question is what losses qualify as business or property losses.”
The Supreme Court majority did not address Horn’s argument that he suffered from an injury to his livelihood—his business—rather than a personal injury by ingesting the THC. The Supreme Court proceeded on the understanding that there was a personal injury because a lower court so held and the finding was not appealed.
Nor did the Supreme Court address a federal appeals court finding that an injury to business includes an injury to employment because the issue was not appealed.
“The only question we address,” Barrett wrote, “is the one squarely before us: whether civil RICO bars recovery for all business or property harms that derive from a personal injury.” It does not, Barrett said.
“In short, a plaintiff can seek damages for business or property loss regardless of whether the loss resulted from a personal injury,” Barrett said.
Justice Clarence Thomas said in a separate dissent he would have dismissed the case as improvidently granted because of a dispute over whether Horn suffered from a personal injury and inadequate briefing on the meaning of a key statutory phrase.
Kavanaugh’s dissent was joined by Chief Justice John Roberts and Justice Samuel Alito.
“The fundamental question here is whether business or property losses from a personal injury transform a traditional personal injury suit into a business injury or property injury suit that can be brought in federal court for treble damages under RICO,” he wrote.
The answer should be no, Kavanaugh said.
“If the rule were otherwise, as plaintiff Horn advocates here,” he wrote, “RICO would federalize many traditional personal injury tort suits.”
The case is Medical Marijuana Inc. v. Horn.
SCOTUSblog had early coverage of the opinion announcements.
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