United States v. Robertson
115 S. Ct. 1732, 514 US 669, 1995 U.S. LEXIS 3042 (1995)
Rule of Law:
An enterprise is considered 'engaged in' interstate commerce under RICO (§ 1962(a)) if it directly participates in the production, distribution, or acquisition of goods or services across state lines, regardless of whether its activities meet the 'affecting commerce' test regarding substantial effects.
Facts:
- Robertson, a resident of Arizona, entered a partnership to finance a gold mining operation in Alaska.
- He invested $125,000 for mining claims and approximately $100,000 for equipment.
- Robertson purchased some of the mining equipment and supplies in Los Angeles, California, and transported them to Alaska for use in the mine.
- He hired seven employees from outside the state of Alaska and paid for their travel to the mine site.
- Robertson operated the mine as a sole proprietorship after the partnership dissolved, continuing to hire out-of-state workers.
- The mine produced between $200,000 and $290,000 in gold.
- While most gold was sold in Alaska, Robertson personally transported approximately $30,000 worth of gold out of the state.
Procedural Posture:
- The United States charged Robertson with narcotics offenses and RICO violations in federal district court.
- The jury convicted Robertson on the narcotics counts and the RICO count.
- Robertson appealed his conviction to the United States Court of Appeals for the Ninth Circuit.
- The Ninth Circuit reversed the RICO conviction, ruling that the government failed to prove the mine 'affected' interstate commerce.
- The United States filed a petition for certiorari with the Supreme Court.
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Issue:
Does a gold mining enterprise satisfy the RICO jurisdictional requirement of being 'engaged in' interstate commerce when it purchases equipment from another state, hires out-of-state workers, and transports a portion of its product across state lines?
Opinions:
Majority - Per Curiam
Yes, the enterprise satisfied the jurisdictional statute because it was directly engaged in interstate commerce through its cross-border activities. The Court reasoned that the Court of Appeals incorrectly applied the 'affecting commerce' test, which is generally reserved for defining Congress's power over purely intrastate activities that have substantial interstate effects. In this case, the 'affecting' test was unnecessary because Robertson's mine was directly 'engaged in' commerce. The Court relied on evidence that Robertson purchased equipment in California for use in Alaska, transported workers between states, and personally carried gold out of Alaska. Citing United States v. American Building Maintenance Industries, the Court held that a business is 'engaged in' commerce when it is directly involved in the production, distribution, or acquisition of goods or services in interstate commerce.
Analysis:
This decision clarifies the jurisdictional reach of RICO by distinguishing between the 'affecting commerce' and 'engaged in commerce' standards. The Court emphasizes that the 'affecting commerce' test—often associated with Wickard v. Filburn—is a fallback for purely intrastate activities. When a defendant actually moves goods, people, or money across state lines, the stricter 'substantial effect' analysis is not required. This simplifies the burden of proof for prosecutors in RICO cases where direct interstate activity is present, preventing lower courts from imposing unnecessarily high thresholds for establishing federal jurisdiction.
