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D'Addario v. D'Addario

United States District Court, D. Connecticut

March 22, 2017

VIRGINIA A. D'ADDARIO, Individually, and on behalf of the F. Francis D'Addario Testamentary Trust and the Virginia A. D'ADDARIO Trust; and VIRGINIA A. D'ADDARIO, EXECUTRIX, as Executrix of the Probate Estate of Ann T. D'Addario, Deceased, and on behalf of the F. Francis D'Addario Testamentary Trust and the Ann T. D'Addario Marital Trust, Plaintiffs,
v.
DAVID D'ADDARIO; MARY LOU D'Addario KENNEDY; GREGORY S. GARVEY; RED KNOT ACQUISITIONS, LLC; SILVER KNOT, LLC; and NICHOLAS VITTI, Defendants.

          RULING GRANTING DEFENDANTS' MOTION TO DISMISS

          Janet Bond Arterton, U.S.D.J.

         Virginia D'Addario ("Virginia") individually, on behalf of two testamentary trusts and in her capacity as Executrix of the probate estate of her deceased mother, Ann T. D'Addario (collectively, "Plaintiffs"), filed this suit against Defendants David D'Addario ("David"), Mary Lou D'Addario Kennedy ("Mary Lou"), Gregory S. Garvey ("Garvey"), Red Knot Acquisitions, LLC ("Red Knot"), Silver Knot LLC ("Silver Knot") and Nicholas Vitti ("Vitti") (collectively, "Defendants") alleging: RICO violations by all Defendants (Count One); breach of fiduciary duties by David D'Addario as Executor of the Estate (Count Two); breach of fiduciary duties by David D'Addario as Trustee of the Testamentary Trust, the Marital Trust and the Virginia Trust (Count Three); aiding and abetting breach of fiduciary duties by all Defendants (Count Four); conspiracy to breach fiduciary duties by all Defendants (Count Five); and unjust enrichment by David D'Addario (Count Six). Defendants move [Doc. # 37] to dismiss Plaintiffs' First Amended Complaint ("Am. Compl") [Doc. #25] in its entirety. Oral argument was held on November 15, 2016.

         In summary, and for the reasons discussed in the Ruling that follows, the Court grants Defendants' Motion to Dismiss because Plaintiffs fail to adequately plead substantive RICO violations, there is no diversity of parties, and the Court will not exercise supplemental jurisdiction over the state law claims. In granting this Motion, the Court finds that Plaintiffs' interest in the Estate is sufficient to confer RICO standing upon them, but that their lost debt injury remains uncertain and speculative and is therefore not ripe. Nonetheless, Plaintiffs' independent claim for collection expenses associated with their lost debt injury is ripe and therefore the Court addresses the sufficiency of Plaintiffs' substantive RICO allegations. Although Plaintiffs pled a pattern or practice of racketeering behavior, and with respect to their Section 1962(b) claim, adequately linked Defendants' racketeering to the maintenance of the enterprise, Plaintiffs failed to allege the necessary separate acquisition and maintenance injury, resulting in dismissal of their Section 1962(b) claim. Plaintiffs' Section 1962(c) claim fails due to the hub-and-spoke nature of the alleged association-in-fact enterprise and Plaintiffs' RICO conspiracy claim under Section 1962(d) must also be dismissed, as Plaintiffs have not sufficiently alleged any substantive RICO violation. Given the dismissal of Plaintiffs' only federal claim, and in the absence of diversity jurisdiction, the Court will not exercise supplemental jurisdiction over Plaintiffs' state law claims and the Complaint will be dismissed in its entirety.

         I. Facts Alleged

         A. Background

         On March 5, 1986 F. Francis D'Addario ("Mr. D'Addario") died in an airplane crash, leaving behind a will directing the manner in which his estate, worth over $120, 000, 000, [1] was to be divided. (Am. Compl. ¶¶ 12, 13, 26.) Mr. D'Addario left behind his wife, Ann T. D'Addario, as well as five children: Virginia, the oldest; Lawrence; Mary Lou; Lisa; and David, the youngest, who is 15 years younger than his oldest sister, Virginia. (Id. ¶ 11.) The will created "a revocable testamentary trust (the "Testamentary Trust"), which provided for approximately one-half of Mr. D'Addario's net assets to go into a marital trust (the "Marital Trust") for the benefit of his wife, Ann, and the other half into separate trusts for the benefit of his five children in equal shares, including a trust for the benefit of his oldest daughter, Virginia (the "Virginia Trust")." (Id. ¶ 12.) Mr. D'Addario appointed his two sons, David and Larry, as well as three non-family members, Executors of the Estate. (Id. ¶ 13.)

         Shortly after Mr. D'Addario's death the will was filed for probate in the Probate Court of Trumbull, Connecticut, with the Honorable John P. Chiota presiding. (Id.) "On March 11, 1986, David D'Addario accepted his appointment as an Executor of the Estate, and, on that date, was charged with the duty of administering and settling the affairs of the Estate in a prompt and efficient manner." (Id.) At that time, David D'Addario was 24 years old and living at his mother's house in Trumbull, Connecticut. (Id. ¶ 14.) He did not have any significant assets to his name, and his only source of income was from working as an employee for his father's business, D'Addario Industries. (Id.) "As of today, and for the last 15 years, David D'Addario and Larry D'Addario are the sole remaining Executors of the Estate. While David and his brother are technically Co-Executors, David exercises dictatorial control over the management and operation of the Estate." (Id. ¶ 15.)

         Virginia fell on difficult financial times and on November 30, 1987 she obtained an advance on her distributional interest in the Estate (in the form of a $3, 900, 000 non-recourse promissory note) to allow her to emerge from Chapter 11 bankruptcy. (Id. ¶ 17.) In return for this advance, David "required that his sister, Virginia, no longer participate in or take part in Estate deliberations or decisions as regards the Estate or its property, and waive all rights ... in her favor against the Executors as regards their administration of the Estate and the validity of their decisions ... except for willful fraud, malfeasance or dishonesty." (Id. (internal quotation marks omitted.)) After executing this agreement, David, cognizant of the fact that should his mother and his older sister, Virginia, predecease him before the Estate closed, their interests in his father's Estate would be distributed on a pro rata basis to himself and his remaining siblings, vowed that Virginia would never receive another penny from the Estate. (Id. ¶ 18.) "In fact, on a number of occasions, David told his sister, Virginia, that 'I'm 15 years younger than you, I'll outlive you, and I can keep the Estate open until after you die.'" (Id.)

         On May 18, 1990 Lisa D'Addario, one of the five siblings, passed away. (Id. ¶ 19.) Her interest in her father's will passed to her siblings in equal shares, making Virginia a 12.5% beneficiary of Mr. D'Addario's will. (Id.)

         According to Plaintiffs, "[f]rom and after the November 20, 1987 agreement with Virginia D'Addario, David D'Addario ran the Estate as his personal piggy bank, and did everything within his power to transfer the significant assets of the Estate for his personal financial benefit." (Id. ¶ 21.) David has consistently refused to provide detailed information to Virginia about the operations of the Estate, despite repeated attempts by Virginia to obtain this information. (Id.) Moreover, after filing a few initial accountings with the Probate Court, after May 31, 1991 David had the Estate stop filing interim accountings and for over four years none were filed without judicial intervention, until July 18, 1995 when the Probate Court ordered the Estate to resume filing these interim accountings. (Id. ¶ 22.) Still, despite this order, David "did not file any additional interim accountings for the Estate until some six years later, when, in 2001, some additional accountings finally were filed, but which only covered the period up to November 30, 1996." (Id.) "In 2006, after another unauthorized and extended hiatus, some post-1996 interim accountings were finally filed with the Probate Court, but David D'Addario had those additional accountings filed under seal so that neither Virginia D'Addario, nor any other interested party, could have access to the accountings covering the period from 1996 through 2006." (Id.) Probate Court Judge Chiota never reviewed the interim accountings and refused Virginia D'Addario's repeated requests to review those accountings. (Id.)

         On October 3, 2011 a new Probate Court Judge, Honorable Joseph A. Egan, Jr., unsealed the interim accountings, giving Virginia the ability to review them. (Id. ¶ 23.) However, the vague and confusing nature of the interim accountings raised more questions regarding the management of the Estate than they answered, as they "consisted mainly of line-item entries that were devoid of meaningful information to assess the propriety of the transactions reported." (Id. ¶¶ 23, 24.) Over the past 30 years David, through the Estate, has resisted all discovery and appealed every order entered by the Probate Judge. (Id. ¶ 24.) David has refused to produce any documents pertaining to his "self-dealing and systematic looting of the Estate." (Id. ¶ 25.)

         B. The Alleged Fraudulent Schemes[2]

         Plaintiffs allege Defendant David D'Addario, with the assistance of the other Defendants and several others not named in the Complaint, engaged in several fraudulent schemes involving property owned by the Estate and debts it owed.

         i. The Honeyspot Road Scheme

         The first of these schemes is known in the Complaint as "The Honeyspot Road Scheme." (Id. § C.) The Honeyspot Road Property, owned free and clear by the Estate, was appraised in December of 1986 as having a fair market value of $3, 800, 000. (Id. ¶ 30.) The most likely candidate to purchase was the lessee of the property, Pace Motor Lines, Inc., which was owned by the Pacelli brothers, friends of the D'Addario family. (Id. ¶¶ 29, 30.) In fact, on January 5, 1989 the Estate accepted an offer to purchase the Honeyspot Road Property for $3, 200, 000. That sale, however, did not close." (Id. ¶ 31.)

         Instead, at the direction of David, the Estate consciously chose not to pay real estate taxes on the Property, nor did it pay the $149, 112.38 owed in delinquent taxes, despite having ample notice and assets to do so. (Id. ¶ 32.) Thus, David decided to "let this multi-million dollar Estate asset be lost at the tax foreclosure sale. As a consequence, on June 28, 1996 the Honeyspot Road Property was sold at the tax foreclosure sale for $179, 323.84 to Dennis and William Miko, who were friends of Mary Lou D Addario." (Id. ¶ 33.) Meanwhile, David directed his attorney, Paul Berg ("Berg"), who was also an attorney for the Estate, to set up a Connecticut limited liability company, Honeyspot Ventures, LLC ("HSV"), which was owned by David, Larry, and Mary Lou. (Id. 34.)

         On September 30, 1997, rather than having the Estate redeem the Honeyspot Road Property, [3] David had the tax sale purchasers, the Miko brothers, quit-claim the Property to his new company, HSV, for $250, 000. (Id. ¶ 35.) Subsequently, "on October 6, 1998 David had HSV sell the Honeyspot Road Property to Honeyspot Investors, LLP - an entity owned by the Pacelli brothers - for $1, 100, 000, which was a price far below the approximately $3, 000, 000 fair market value of that property." (Id.) This resulted in a profit of $850, 000, none of which went to the Estate, but which was instead divided among David, Larry, and Mary Lou D'Addario. (Id. ¶ 36.)[4]

         ii. The Frenchtown Road Scheme

         The Estate also owned a 50% ownership interest in 34.4 acres of undeveloped real estate on Frenchtown Road in Trumbull, Connecticut (the "Frenchtown Road Property"). (Id. ¶ 41.) The remaining 50% interest was owned by the family of Joseph Rosenberg. Mr. D'Addario's interest in the Property, according to Mr. D'Addario's 1985 financial statement, was worth $1, 250, 000, with no mortgage indebtedness. (Id.) Upon learning in the spring of 1989 that the Town of Trumbell wanted to purchase the Property for a new school, David and Attorney Berg formed Sunny Spot Associates, LLC ("SSA"), with David as owner and manager, and acquired the Rosenberg 50% interest in the Property for $450, 000. (Id. ¶¶ 42, 43.) This was done without affording the Estate the opportunity to acquire the Rosenberg interest in the Property, which the accountings make clear it could have afforded, and in fact the opportunity was concealed from Virginia, the Estate's unsecured creditors, and the Probate Court. (Id. ¶ 43, 45.)

         Then, on May 15, 1999 David directed Attorney Berg to form Old Town Land Partners, a partnership between David's company, SSA, and the Estate. (Id. ¶ 44.) David, through Berg, subsequently had SSA and the Estate transfer their 50% interests in the Frenchtown Road Property to Old Town Land Partners, which proceeded to sell to the Town of Trumbell the Property for $6, 000, 000. (Id.) Pursuant to this scheme, David's company SSA, made a $2, 550, 000 profit on the sale, which should have gone to the Estate. (Id.) Moreover, the Estate contributed $750, 000 to the Town of Trumbull for the right to name the new school on Frenchtown Road after David's mother, Ann D'Addario. (Id.)

         Hi. The Red Knot Forbearance Agreement Scheme

         When the Estate was opened in March 1986, the Executors reported that it had total liabilities in the amount of $41, 363, 977, secured by some of Mr. D'Addario's assets. (Id. ¶ 47, 48.) The majority of this debt ($25, 218, 084) was owed to three different banks (the "Bank Group"). (Id. ¶ 48.) As a result of the Estate defaulting on some of the obligations in connection with the previous loans made to Mr. D'Addario, on December 13, 1990 "the Bank Group and the Estate entered into an omnibus agreement governing the continuing credit relationship between the parties (the 'Definitive Agreement'). Under the Definitive Agreement, approximately $14, 000, 000 in additional funds were loaned by the Bank Group to the Estate, but certain limitations were imposed on the Executors' management and operation of the Estate." (Id. ¶ 49.) By the end of December, 1997, the debt owed to the Bank Group had grown to over $48, 000, 000. (Id. ¶ 53.) However, because of "inner turmoil, " the Bank Group offered to extinguish this debt if the Estate paid them only $4, 750, 000 (a $43, 250, 000 discount). (Id.)

         David claimed the Estate could not come up with the $4, 750, 000, while the recently unsealed interim accountings reveal that the Estate did in fact have "plenty of cash, liquid assets and other free and clear assets to come up with the $4, 750, 000 necessary to extinguish the $48, 000, 000 in secured loan obligations." (Id. ¶¶ 54, 55.) Instead of paying the Bank Group, David had Attorney Berg establish Red Knot, an entity that was supposedly owned and controlled by long-time friend and business partner, Garvey, but in reality was the mere alter-ego of David D'Addario. (Id. ¶ 54.) Red Knot, in turn, acquired the Bank Group's loan position and then entered into a so-called "Forbearance Agreement" for the debtor-creditor relationship between the Estate and the purchasing entity-Red Knot." (Id. ¶ 54.)

         Under the Forbearance Agreement, signed December 30, 1997,

the Estate granted Red Knot a lien on virtually all of the Estate's assets, and also provided that, should David D'Addario ever be removed as an Executor of the Estate, Red Knot [which Plaintiffs allege is simply David's alter-ego] had the immediate right to engage in collection efforts on the over $48, 000, 000 allegedly owed to Red Knot, including the right to foreclose on all of the Estate's assets.

(Id. ¶ 59.) This "Executor for life" clause was inserted in the Forbearance Agreement despite the fact that the Bank Group had previously filed a Motion to Remove David D'Addario as an Executor of the Estate, which listed as grounds for removal: negligence, mismanagement, malfeasance and serious conflicts of interest. (Id.) Additionally, the Forbearance Agreement provided the Estate with a "purchase option" that, on paper, allowed the Estate an option to purchase the Bank Group's loan position (now held by Red Knot) at a steep discount, with the option price increasing at a rate of over 20% per year until January 7, 2003, at which time the purchase option was set to expire (the "Estate Purchase Option"). (Id. ¶ 60.)

         The recently unsealed accountings reveal that the Estate had paid Red Knot $6, 650, 000 leaving a balance of $828, 383, which the Estate could have purchased (and had the funds to do so) at a discount pursuant to the Estate Purchase Option. (Id. ¶ 64.) However, rather than exercise the Estate Purchase Option, thus ridding the Estate of an additional $55, 000, 000 of debt, "David let the Estate Purchase Option at the $828, 383 buy-out price expire, with the amount thereafter allegedly owed by the Estate to Red Knot exceeding $100, 000, 000, and with a purported lien by Red Knot on all of the Estate's assets." (Id. ¶ 65.) In Plaintiffs' view:

[T]he only real use of the Forbearance Agreement was as a threat to (a) the unsecured creditors, (b) the beneficiaries under Mr. D'Addario's Will (such as David D'Addario's older sister, Virginia), and (c) the Probate Court (including the Superior Court upon de novo appeal) that if David was pushed too hard or was ever removed as an Executor, Red Knot (as the alter-ego of David D'Addario) would exercise its 'rights' under the Forbearance Agreement to commence collection proceedings on its alleged $55, 000, 000 in secured indebtedness, and thus annihilate the Estate. That club, however, would be lost should the Estate ever pay off the supposed Red Knot indebtedness at the steeply discounted price in accordance with the Estate Purchase Option.

(Id. ¶ 69.) Therefore, Plaintiffs conclude that the Red Knot Forbearance Agreement was, and continues to be, a fraud on the court used by David as a means of staying in control of the Estate. (Id. ¶ 70.)

         iv. The Wrongful Use and Transfer of Estate Owned Residential Properties for the Benefit of David, Larry, and Mary Lou D'Addario

         Plaintiffs allege that David rewarded his brother and sister, Larry and Mary Lou, for their willingness not to question his management and operation of the Estate. (Id. ¶ 73.) He did this by giving them "free and unfettered use of several different properties owned by the Estate, with the Estate continuing to pay all costs and expenses associated with the use and maintenance of these properties. (Id.) David also enjoyed this benefit. (Id.) Moreover, several of these properties (the San Francisco condo, Vermont condo, Vermont lot, and New York condo) were either sold to a third party or transferred to David or his siblings, without any indication that funds were ever paid to the Estate for these transactions. (Id.)

         v. The Silver Knot/Wise Metal Scheme

         "Silver Knot is a corporation that was set up by David D'Addario and Garvey in early 1999 to acquire a controlling interest in Wise Metals, which was a producer of aluminum can stock for the beverage industry." (Id. ¶ 74.) In 2001, David, through his ownership interest in Silver Knot, acquired a majority interest in Wise Metals. (Id.) Plaintiffs contend that David D'Addario used assets, proceeds and business opportunities of the Estate to acquire a controlling interest in Wise Metals through Silver Knot, which interest equitably belonged to the Estate. (Id. ¶ 75.) Then, in October of 2014 a Dutch company "acquired Wise Metals, through its purchase of Silver Knot, for $1.4 billion, comprised of a cash payment to David D'Addario's company, Silver Knot, of $455, 000, 000, and the assumption of $945, 000, 000 in debt. (Id.) David's ownership interest in Silver Knot and the proceeds resulting from the sale of Wise Metals belonged to the Estate, but David has converted it for his own personal benefit. (Id. ¶ 77.)

         vi. Red Knot/David D'Addario Settlement Scheme

         Finally, Plaintiffs detail a series of lawsuits, beginning with one brought against David and Larry as Executors of the Estate by The Cadle Company ("Cadle"), which was owed in excess of $810, 000 on a promissory note Mr. D'Addario executed prior to his death. Final judgment was entered on March 1, 2010 by the Superior Court, awarding Cadle $810, 245.59 as the principal amount due under the $1, 000, 000 Note, along with interest and costs, for a total judgment against the Estate in the amount of $2, 580, 470.23. (Id. ¶ 83.) David made no effort to pay the amount due by the Estate to Cadle. (Id.) Consequently, "after unearthing evidence of David's systematic and long-term looting of the Estate, " Cadle filed suit against David D'Addario, Garvey, Red Knot and others for engaging in a RICO conspiracy to denude the assets of the Estate. See The Cadle Company v. David D'Addario, et al., United States District Court, District of Connecticut, No. 3:12-cv-00816-WGY (Hon. William G. Young, J., Dist. of Mass., sitting by designation) (the "Cadle RICO Suit"). (Am. Compl. ¶ 84.) Judge Young administratively closed the case for a period of nine months in order to allow David, as Executor, the opportunity to bring the Estate to a close and pay Cadle the amount owed, after which it could be reopened upon motion by either party. (Id. ¶ 85.)

         David and Garvey devised a plan, using his alter-ego, Red Knot, to prevent the Cadle RICO Suit from reopening, which would allow Cadle to conduct discovery (thus revealing the sham Red Knot Forbearance Agreement and David's systemic looting of the Estate). (Id. ¶ 86.) Essentially, an Estate asset - the Hi Ho Motel - was transferred to Red Knot for a $4, 500, 000 credit on an amount supposedly owed to Red Knot, and Red Knot subsequently sold that Motel and used the proceeds to buy Cadle's judgment against the Estate, thereby settling Cadle's RICO Suit claims without any discovery ever occurring. (Id. ¶ 87.)

         Plaintiffs contend that "[t]he transfer of the Motel from the Estate to Red Knot for the purpose of funding the settlement of a multi-million dollar claim against David D'Addario contributed to the insolvency of the Estate, and eventually left Plaintiffs unable to receive their promised inheritable beneficial interests from the net assets of the Estate." (Id. 90.)

         C. Breach of Fiduciary Duty to Trusts

         As an Executor of the Estate, David D'Addario never properly funded the Testamentary Trust, the Marital Trust, or the Virginia Trust, and as Trustee of those trusts, never diligently pursued the full funding of those trusts with assets from the Estate. (Id. ¶ 92.) Instead, "David conspired with the other Defendants named herein to keep the assets of the Estate out of those trusts such that those assets would stay within the control of David as the chief Executor of the Estate, which would, in turn, allow David to deal with those assets as he chose for his personal financial benefit." (Id.) Plaintiffs claim that David systematically manipulated the Testamentary Trust, the Marital Trust and Virginia Trust from November 30, 1987 to the present, so that they became his alter-egos, and were simply used by him to perpetuate the fraudulent and other wrongful conduct set forth in their complaint. (Id. 93.)

         D. Probate Court

         According to Plaintiffs, the Connecticut Probate Court has permitted David D'Addario, an interested party, to preside over the "liquidation and winding-up of the affairs of an $162, 000, 000 probate estate, with virtually no supervision over [his] conduct, and no accountability for [his] wrongful conduct." (Id. ¶ 96.) Without any true judicial supervision, the Estate has sold or otherwise disposed of approximately 75 assets or businesses since March of 1986. (Id.) Even when accountings were finally filed, they were under seal and were not reviewed by the Probate Court Judge. (Id.) David D'Addario has no intention of closing the Estate. (Id. ¶ 100.)

         On September 25, 2012 Judge Egan ordered the Executors to report to the Court as to what steps have or are being taken to finalize the administration of this Estate beginning January 1, 2013 and quarterly thereafter. (Id. ¶ 101.) The Executors never provided to the Probate Court such a report. (Id.) On July 16, 2013 the Probate Court again ordered the Executors to submit a report detailing what steps the fiduciaries have taken or are going to take to satisfy all outstanding creditors and asking when they anticipate the Estate will be closed. (Id.) To date the Executors have failed to provide the Probate Court with the required information. (Id.)

         Although David has represented to the Probate Court on numerous occasions that the Estate is solvent, Plaintiffs aver that these misrepresentations were at best misleading, if not knowingly false.[5] (Id. ¶¶ 108-09.) Put simply, Plaintiffs allege that the Estate is currently insolvent. (Id. 113.)

         II. Discussion[6]

         Plaintiffs contend that Defendants' conduct constitutes violations of 18 U.S.C. §§1962(b), (c) and (d) of RICO.[7] Defendants move to dismiss the entire Complaint, focusing in substance on Plaintiffs' RICO claims (Count One), which they contend are the only valid basis for federal jurisdiction. Defendants' Motion offers the following grounds for dismissing Plaintiffs' RICO claims: 1) Plaintiffs do not have standing to pursue their RICO action; 2) Plaintiffs' claims are unripe; and 3) Plaintiffs have failed to plead the requisite elements of a RICO claim under either §§ 1962(b), (c), or (d). Defendants argue that because Plaintiffs' RICO claims must be dismissed, the Court lacks subject matter jurisdiction over the remainder of the claims and thus that the entire case must be dismissed. The Court takes each argument in turn.

         A. Plaintiffs Have Standing to Bring Their RICO Claims

         Defendants assert that Plaintiffs lack standing to pursue their RICO claims because the Estate, and not Plaintiffs, was the direct victim of the Defendants' alleged long-term pattern of wrongful conduct, and therefore the Estate is "the [only] party with standing to bring a civil RICO claim." (Def.'s Mot. to Dismiss at 7.) Plaintiffs respond that they have adequately alleged causation of injury to their business or property, especially given that Virginia D'Addario was the primary target of David's actions.[8]

         In order to establish a civil RICO violation, Plaintiffs must meet the following standing requirements: "(1) a violation of section 1962; (2) injury to business or property; and (3) causation of the injury by the violation." First Nationwide Bank v. Gelt Funding Corp., 27 F.3d 763, 767 (2d Cir. 1994). Plaintiffs "must prove not only that the acts of [D]efendant constitute a RICO violation, but also that [P]laintiff suffered injury as a result of that violation. Until such injury occurs, there is no right to sue for damages ..." Bankers Trust Co. v. Rhoades, 859 F.2d 1096, 1102 (2d Cir. 1988). Thus, a plaintiff alleging a civil RICO violation must "demonstrate a direct relation between the injury suffered [to his/her business or property] and the alleged injurious conduct." Holmes v. Sec. Inv'r Prot. Corp., 503 U.S. 258, 268 (1992).[9] In Holmes, the Supreme Court held that a court must examine the following three factors to determine whether an alleged RICO violation proximately caused injury to the plaintiffs business or property as required by the RICO statute: (1) the degree of directness of the injury; (2) the difficulty of apportioning damages among others affected by the alleged RICO violations; and (3) the possibility that other more directly injured victims could better vindicate the policies underlying RICO. 503 U.S. at 269-70.

         Defendants' two primary authorities for claiming that "Plaintiffs, as beneficiaries to an estate . . . lack standing to bring a civil RICO suit based on any alleged injury to their expected inheritable interests" are two unpublished, out-of-circuit cases: Schrager v. Aldana, 542 F.App'x 101 (3d Cir. 2013) and Firestone v. Galbreath,976 F.2d 279 (6th Cir. 1992). (Def.'s Mot. to Dismiss at 7.) ...


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