The opinion of the court was delivered by: Honorable Paul A. Crotty, United States District Judge
Plaintiff Robert Hoatson ("Plaintiff") instituted this action on December 13, 2005*fn1 against ten defendants in four groups, each of which is separately represented:
(1) the New York Archdiocese and Cardinal Edward Egan; (2) the Newark Archdiocese and Archbishop John J. Myers; (3) the Congregation of Christian Brothers, Father John O'Brien, Br. Laurence Boschetto,*fn2 and Br. Paul Kevin Hennessy; and (4) the Roman Catholic Diocese of Albany and Bishop Howard J. Hubbard ("Defendants"). Plaintiff filed an amended complaint on January 19, 2006. Plaintiff alleges that for years he witnessed and experienced sexual abuse at the hands of the clergy, and that after he publicly exposed the abuse and coverup and the Catholic Church's handling of sexual abuse scandals, Defendants fired him from his position as Director of Schools at a Catholic school in Newark.
Based on these assertions, Plaintiff brings nine causes of action, two of which are based on federal law: 1) Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. § 1961, et seq; and 2) Title VII of the Civil Rights Act of 1964. The seven other causes of action are state claims: 1) violation of New Jersey statutory whistleblower laws; 2) intentional infliction of emotional distress; 3) tortious interference with employment; 4) sexual abuse; 5) breach of fiduciary duty; 6) negligence; and 7) hostile work environment.
On March 31, 2006, each of the Defendants moved to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1) and (6). Plaintiff responded on May 16, 2006 and Defendants replied on June 6, 2006. On May 24, 2006, all Defendants moved for sanctions pursuant to Federal Rule of Civil Procedure 11. Plaintiff responded on August 14, 2006; and Defendants replied on August 28, 2006.
In the normal course, the motions would have been argued in late summer or early fall, but on September 9, 2006, Plaintiff moved to recuse the Court on the grounds of prejudice and bias. After the matter was briefed and argued, the Court issued its decision denying the recusal motion. Hoatson v. N.Y. Archdiocese, et al., 05-CV-10467, 2006 U.S. Dist. Lexis 87877 (S.D.N.Y. Dec. 1, 2006). Four days later, Plaintiff wrote to the Court indicating his desire to withdraw his RICO claim without prejudice. Defendants objected to withdrawal without prejudice. At a subsequent conference held on December 21, 2006, the Court advised Plaintiff that he could withdraw the RICO claim with prejudice, but if Plaintiff chose not to do that, the Court would proceed to address the Defendants' motions to dismiss. The Court also advised Plaintiff that absent the federal question claims, there would be no basis for federal jurisdiction since there was no diversity. The Court gave Plaintiff time to make his decision. On January 5, 2007, Plaintiff chose not to withdraw with prejudice his RICO claim and the matter came on for oral argument on January 30, 2007.
The Court grants Defendants' 12(b)(6) motion to dismiss with prejudice Plaintiff's RICO and Title VII claims. With the dismissal of the federal claims and since there is concededly no diversity, the Court declines to exercise supplemental jurisdiction over the state law claims and dismisses them without prejudice. As for the motion for sanctions against John Aretakis, the Court imposes monetary sanctions and issues an admonishment.
Plaintiff's amended complaint recounts various episodes of sexual abuse he and other members of the Church allegedly experienced at the hands of clergymen dating back to his entry into the Christian Brothers novitiate in the early 1970s. Plaintiff further alleges that the Defendants have "engaged in an intentional and long standing practice of intimidating victims of clergy sexual abuse and their advocates including Plaintiff, and [have] a longstanding pattern or scheme of protecting priests from being arrested, charged, indicted or convicted for crimes of a sexual nature, as well as a criminal cover-up of same, and have retaliated against, harassed and discharged the plaintiff for exposing same." (Am. Compl. ¶ 67.)
Plaintiff specifically alleges that in late May 2003, Plaintiff testified before the New York State Senate on behalf of clergy sexual abuse victims, and in support of legislation to amend New York's statute of limitations regarding such crimes. (Am. Compl. ¶ 58.) Almost immediately after testifying, according to the amended complaint, the Defendants "had the Plaintiff fired from his position as Director of Schools at Our Lady of Good Counsel Parish in Newark, New Jersey."*fn4 (Am. Compl. ¶ 63.)
Plaintiff's experience is claimed to be similar to what others experienced for speaking out against sexual abuse by clerics and for helping victims of clerical sexual abuse.
I. Motion to Dismiss Standard
The district court may dismiss a claim under Federal Rule of Civil Procedure 12(b)(6) only if "it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations." H.J. Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 249-50 (1989) (citing Hishon v. King & Spalding, 467 U.S. 69, 73 (1984)). The court must accept as true all well-pleaded factual allegations in the complaint, and view them in the light most favorable to the plaintiff. See De Jesus v. Sears, Roebuck & Co., 87 F.3d 65, 70 (2d Cir. 1996). Despite the Rule's liberal standard, "conclusory allegations or legal conclusions masquerading as factual conclusions" are not sufficient to withstand a motion to dismiss. Id.
Plaintiff alleges a violation of 18 U.S.C. § 1962(c) and (d). Subsection (c) makes it unlawful "for any person employed by or associated with any enterprise . . . to conduct or participate . . . in the conduct of such enterprise's affairs through a pattern of racketeering activity . . . ." Subsection (d) makes it "unlawful for any person to conspire to violate . . . subsection (c) . . . ." What constitutes "racketeering activity" is not simply bad or offensive conduct, but rather what the statute specifically defines as racketeering activity in § 1961(1). In order to have a civil remedy, a person must also be "injured in his business or property by reason of a violation of section 1962 . . . ." 18 U.S.C. § 1964(c).
To establish a violation of 18 U.S.C. § 1962(c), a plaintiff must show "(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity." De Falco v. Bernas, 244 F.3d 286, 306 (2d Cir. 2001) (citing Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 (1985)). Furthermore, the requirements of section 1962(c) must be established as to each individual defendant. See id.
RICO defines an "enterprise" as "any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity." 18 U.S.C. § 1961(4). The term "enterprise" includes both legitimate and illegitimate enterprises. See United States v. Turkette, 452 U.S. 576, 582-83 (1981). A RICO enterprise is "proved by evidence of an ongoing organization, formal or informal, and by evidence that the various associates function as a continuing unit."
Id. at 583. The "enterprise" is neither the individual defendant nor the "pattern of racketeering activity;" rather it is "an entity separate and apart from the pattern of activity in which it engages," and must be alleged and proved separately. Id.
As a matter of pleading, Plaintiff has failed to adequately allege the requisite "enterprise." Plaintiff asserts that "[t]he relationship between the defendants constitutes an association in fact," over which defendants "Myers, Egan, and Hubbard all exhibit and exercise control." (Am. Compl. ¶ 133.) Further, he claims that "[t]he defendants Dioceses and/or the defendants Myers, Hubbard, and Egan constituted an actual enterprise as required by statute, and that each of these defendants has engaged in two or more predicate acts,". and "[t]he enterprise has and has had continuity of structure and shared and common purpose and the scheme or pattern of protecting, hiding and moving sexually abusive priests has been going on for decades." (Am. Compl. ¶¶ 146, 137.)
Beyond these wholly conclusory allegations, Plaintiff does not allege any facts that the defendants functioned "as a continuing unit," or were "an entity separate and apart" from their alleged illegal activities. Rather, it appears that this group of Defendants has been grouped together for the sole reason that they all allegedly had a hand in Plaintiff's termination. The "enterprise," however, must exist and function separately from the alleged illegal acts, and Plaintiff has failed to assert that. There are simply no facts whatsoever to support Plaintiff's conclusory allegation that any "enterprise," as defined by RICO, existed.
ii. Pattern of Racketeering Activity
To properly plead the existence of a pattern of racketeering, a plaintiff must allege and prove that "at least two acts of "racketeering activity" were committed in a 10-year period. 18 U.S.C. § 1961(5). The predicate acts of racketeering must be related and constitute a threat of continuing activity. See Nw. Bell Tel. Co., 492 U.S. at 239. Each defendant must have engaged in two predicate acts. See De Falco, 244 F.3d at 306. Similar to the allegations of "enterprise," there are only bald conclusory allegations that each defendant committed two predicate acts. There is not even a minimal attempt to allege which predicate acts were performed by which Defendants.
(b) Racketeering Activity
"Racketeering activity" is defined in 18 U.S.C. § 1961(1) to include, inter alia, a number of crimes including kidnapping, extortion, obstruction of justice and mail and wire fraud. Plaintiff makes a laundry list of allegations in the amended complaint.*fn5
Only three of them, however, could possibly constitute predicate acts under RICO: 1) extortion under the Hobbs Act, 18 U.S.C. 1951; 2) mail and wire fraud, in violation of 18 U.S.C. § 1341 and § 1343; and 3) violations of the Protection of Children Against Sexual Exploitation Act, 18 U.S.C. § 2251, et seq. (Am. Compl. ¶ 142.) Pleading requires more than a recitation of the statute purportedly violated; and Plaintiff has failed to sufficiently allege any racketeering activity.*fn6
Plaintiff maintains that he was the victim of extortion. Pursuant to 18 U.S.C. § 1951(b)(2), extortion is defined as, "the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened ...