United States v. Bledsoe
754 F.2d 377 (1984)
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Rule of Law:
An "association-in-fact" constitutes an enterprise under the Racketeer Influenced and Corrupt Organizations Act (RICO) only if it has an ascertainable structure, a common purpose, and continuity of structure and personnel that is distinct from the pattern of racketeering activity itself.
Facts:
- Harold Russell Bledsoe, S. L. Srygley, and others formed a group to sell lifetime memberships in a purported non-profit organization called 'American Vets.'
- The group targeted elderly individuals for their sales.
- Salespeople made false representations, claiming the organization would provide substantial benefits to its members and that membership fees were tax-deductible charitable contributions.
- The group operated under various names and had a consistent structure, with Bledsoe and Srygley acting as leaders who recruited and managed salesmen.
- The funds collected from the memberships were not used for any charitable or organizational purpose but were instead converted to the personal use of the group's members.
- This scheme continued over a period of time, demonstrating continuity in the group's personnel and operations.
Procedural Posture:
- Harold Russell Bledsoe was indicted in the United States District Court for the Western District of Missouri on one count of conspiracy to violate RICO and multiple counts of mail fraud.
- A jury found Bledsoe guilty on the RICO conspiracy count and fourteen counts of mail fraud.
- Bledsoe, the appellant, appealed his conviction to the United States Court of Appeals for the Eighth Circuit.
- On appeal, Bledsoe argued that the government, the appellee, failed to present sufficient evidence to prove the existence of a RICO 'enterprise.'
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Issue:
Does an "association-in-fact" constitute an "enterprise" under the Racketeer Influenced and Corrupt Organizations Act (RICO) only if it has an ascertainable structure distinct from that inherent in the commission of the predicate acts of racketeering?
Opinions:
Majority - Arnold, J.
Yes. For an association of individuals to constitute a RICO enterprise, it must have an ascertainable structure distinct from the pattern of racketeering activity. The Supreme Court in United States v. Turkette established that the 'enterprise' is a separate element that must be proved and is not synonymous with the 'pattern of racketeering activity.' The enterprise is the 'vehicle' through which the unlawful activity is conducted. Therefore, the evidence must show that the enterprise has an existence beyond that which is necessary merely to commit the predicate acts. This requires proof of a common purpose, a continuity of structure and personnel, and an ascertainable structure distinct from the racketeering. In this case, the government's evidence was sufficient to show such an enterprise, as the group had a defined, ongoing structure with leaders and salesmen that was more than just the sum of the mail fraud acts.
Analysis:
This decision established the influential three-part test in the Eighth Circuit for defining an 'association-in-fact' enterprise under RICO. By requiring a structure distinct from the criminal acts, the court prevents the government from using RICO to prosecute ordinary conspiracies that lack a separate organizational framework. This interpretation ensures that RICO targets genuinely organized, ongoing criminal entities, rather than becoming a duplicative tool for any case involving multiple defendants or predicate acts. This 'structure-plus' standard has guided subsequent RICO litigation, clarifying the evidentiary burden on prosecutors.
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