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Supreme Court Hears Arguments Over Whether RICO Covers Economic Harms Tied to Personal Injuries
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Summary
In Medical Marijuana v. Horn, counsel debated whether civil RICO excludes "damages resulting from personal injuries," with justices probing proximate cause, foreseeability and the risk of federalizing state tort claims; the case was submitted to the Court.
The Supreme Court heard argument in Medical Marijuana v. Horn over whether civil RICO (the Racketeer Influenced and Corrupt Organizations Act) permits recovery for economic harms that "result from personal injuries," with counsel and justices debating where to draw the line.
During the petitioners' opening, counsel identified in the transcript as Miss Blatt urged the Court to read the statute to exclude damages that "result from personal injuries," arguing that the statutory distinction between "injury" and "damages sustained" means RICO does not remediate classic personal-injury losses such as lost wages and medical expenses. She argued that treating those losses as RICO injuries would "federalize" a wide swath of state tort litigation and run afoul of Congress's limits.
Respondent counsel, identified in the transcript as Miss Anand, urged the opposite reading: she said the phrase "damages sustained" in 18 U.S.C. (the provision authorizing treble damages) means compensatory damages, and that a loss of income from being fired is an "injury to our business" that RICO can redress. Anand stressed that proximate-cause and other RICO elements (enterprise, pattern, continuity) provide guardrails against overreach.
Justices pressed both sides on two central questions: whether lost wages and medical expenses can be recharacterized as injuries to "business or property" rather than as damages from a personal injury, and whether proximate cause and foreseeability can screen out cases that would otherwise convert ordinary state tort claims into federal RICO suits. Several justices tested hypotheticals (assaults, kidnapping, mislabeled products, and car-wash and car-wash-operator examples) to probe when a physical invasion or other bodily harm should continue to be treated as a personal injury rather than a RICO injury.
Significant direct quotations from the oral argument captured the dispute. Counsel for the petitioner said, "Personal injuries are serious and may support state tort claims, but they are not the stuff of Rico." Respondent counsel summarized the respondent's core claim plainly: "The injury here is we were fired," saying that lost wages are the harm to be redressed and that compensatory damages are the appropriate measure.
The justices also weighed policy implications. Petitioners warned that allowing such claims could "cannibalize" state tort law; respondents pointed to other statutory and evidentiary guardrails and to the practical experience of circuits that have allowed similar claims.
After extended questioning and rebuttal argument, the Court announced that the case was submitted.
What happens next: the justices will consider the statutory text, this Court's precedent on RICO and related remedial provisions, and the proximate-cause analysis discussed at argument before issuing a written opinion. The transcript does not record a decision.