SCOTUS Resolves Circuit Split On How To Assess Domestic Injury Under RICO

Key Takeaways:

• The Supreme Court, building on its holding in RJR Nabisco, Inc. v. European Community, held in Yegiazaryan v. Smagin that courts must apply a context-specific test when analyzing whether a RICO plaintiff has sufficiently pled a domestic injury.
• Applying this new test, the Court found a foreign plaintiff may bring a RICO claim against a defendant who is seeking to avoid the enforcement of an arbitral award through an alleged pattern of racketeering activity.
• This ruling shows RICO is a powerful U.S. tool to combat fraudulent evasion of judgments enforcing arbitral awards that, when combined with other aspects of U.S. litigation (e.g. discovery), could make the U.S. an attractive forum for plaintiffs to seek enforcement.