H.J. Inc. v. Northwestern Bell Telephone Company

RESPONDENT: Northwestern Bell Telephone Company
LOCATION: State University of New York Albany

DOCKET NO.: 87-1252
DECIDED BY: Rehnquist Court (1988-1990)
LOWER COURT: United States Court of Appeals for the Eighth Circuit

CITATION: 492 US 229 (1989)
ARGUED: Nov 08, 1988
DECIDED: Jun 26, 1989

John D. French - on behalf of the Respondents
Mark Reinhardt - on behalf of the Petitioners

Facts of the case


Media for H.J. Inc. v. Northwestern Bell Telephone Company

Audio Transcription for Oral Argument - November 08, 1988 in H.J. Inc. v. Northwestern Bell Telephone Company

William H. Rehnquist:

We'll hear argument next in No. 87-1252, H. J. Inc. v. Northwestern Bell Telephone Company.

Mr. Reinhardt, you may proceed whenever you're ready.

Mark Reinhardt:

Mr. Chief Justice, and may it please the Court:

This case is a review of the dismissal of Petitioners' complaint brought under 18 U.S.C. 1961 and 1968, commonly known as RICO.

The specific acts alleged in our complaint were a series of bribes carried out by Northwestern Bell Telephone Company affecting a number of different Northwestern Bell charges ranging from pay phone rates to the cost of buying home telephones.

These bribes, carried out over a period of years, involved various Bell officials, agents, passing over $140,000 to members of the Minnesota Public Utilities Commission.

The Public Utilities Commission is the rate setting, semi or quasi-judicial body in Minnesota that sets Bell's rates.

As pointed out in footnote 1 at page 4 of our brief, a later commission discovered this activity of Bell and reopened one of the many affected rates because of this undue influence.

They cut that tainted rate of $57 million by over $10 million.

This discussion should be broken into three parts: first, the Eighth Circuit's multiple scheme dismissal of this case should be reversed; second, what is a pattern of racketeering activity'; and third, a brief discussion of amici's organized crime connection argument which we submit should be rejected.

First, this Court should reject the Eighth Circuit's multiple scheme requirement.

Nowhere in the plain words of the statute, or indeed, in the legislative history, do we find the words "multiple schemes".

Pattern is defined in statute 1961 as two acts of racketeering activity, not two schemes, just two acts.

There's no multiplicity of schemes involved.

Indeed, a reading of 1962, the operative portion of the RICO statute, shows the impossibility of the Eighth Circuit's position.

1962 forbids a pattern of, forbids a person of acquiring an interest in an enterprise through a pattern of racketeering activity.

In other words, there is a pattern plus the goal of acquiring an interest in this enterprise.

These two together form a single scheme, as do all schemes.

You have a pattern--

Sandra Day O'Connor:

Mr. Reinhardt, at least you take the position that there have to be separate criminal transactions for the pattern.

Mark Reinhardt:

--Your Honor--

Sandra Day O'Connor:

If not schemes, at least separate transactions.

Mark Reinhardt:

--There has to be separate acts, a pattern of acts is the definition.

Those acts could, in certain limited situations, be part of one transaction, although the word "transaction" is hardly self-defining.

Sandra Day O'Connor:

Well, I'm not sure about that.

How do we, how do we give meaning to the continuity requirement that Congress clearly intended to have a role in the pattern inquiry?

Mark Reinhardt:

Your Honor, I think continuity can be thought of, of course, as a series, as you just pointed out, a number of transactions.

However, I believe it also has within it the threat of being a series, and a prime example is the Watchmaker case cited in our brief where some Hell's Angels shot some police officers in one incident.

There were two or perhaps three acts in that case.

There was no other acts or transactions that could be pointed to, but it was clear that through the Hell's Angels enterprise that these acts were committed so as to allow for the threat of continuity or for continuity.