We recently posted on the analysis of the extraterritoriality issue stemming from Morrison but applied to RICO claims (here). In that case, involving Chevron and the proceeings pending in the Southern District of New York, the District Court here determined that the Second Cicruit’s decision in Norex Petroleum Ltd. v Access Indus., Inc., 631 F.3d 29 (2d Cir. 2010), did not determine that RICO claims (18 U.S.C. sec. 1962(c)) could never apply to cases where some of the conduct occurred outside the U.S.; that indeed the matters giving rise to the initial and significant RICO prosecutions included matters with substantial non-U.S. contacts; and that the key issues in that case led to the conclusion that RICO did apply to certain of the claims presented there.
In Aluminum Bahrain B.S.C. v. Alcoa, Inc., et al., Civil Action No. 8-299 (W.D. Pa. 2012), the District Court similarly analyzed claims under RICO. Even though this particular had “previously acknowledged that the Morrison decision has been understood to preclude extraterritorial application of RICO, the Court here concluded that the allegations before it were not “essentially foreign” and came to a different result.
The allegations here included that Alcoa, in and from the U.S. controlled the Autrailian affiliate alleged to have been the principal wrongdoer (alleged bribes to senior officials of Alba and the Government of Bahrain). The complaint identified each of the members of the allegedly criminal enterprise as domestic U.S. persons or entities. Numerous other U.S. contacts are alleged and mentioned in the Court’s decision.
Of the Second Circuit’s decision in Norex, the District Court here said:
At first blush, the analogy is appealing. In Norex, the plaintiff was foreign, complaining of a conspiracy involving a foreign industry. Yet further analysis reveals the analogy wanting. In Norex, the court focused its analysis on determining whether a Morrison assessment should be done under the guise of subject matter jurisdiction or a failure to state a claim. Deciding on the latter, the court provided little commentary on what quality and quantity of contacts would qualify an enterprise as “domestic” under Morrison rather than “foreign.”