RICO Expansion: How the Supreme Court’s Decision Impacts Personal Injury Lawsuits

The landscape of personal injury law has undergone a significant shift. On April 2, 2025, the Supreme Court issued a landmark ruling that expands the scope of the Racketeer Influenced and Corrupt Organizations (RICO) Act, potentially opening new avenues for personal injury lawsuits. This decision, stemming from Medical Marijuana, Inc. v. Horn, resolves a long-standing circuit split and could lead to a proliferation of RICO claims in federal courts. Understanding the implications of this expansion is crucial for both plaintiffs and defendants in personal injury cases.

Understanding the RICO Act

Enacted in 1970, RICO was initially designed to combat organized crime by targeting racketeering activities. The Act provides both criminal penalties and a civil cause of action for individuals or entities harmed by such activities. To establish a RICO claim, a plaintiff must demonstrate:

Conduct: The defendant participated in the affairs of an enterprise through a pattern of racketeering activity.
Enterprise: An “enterprise” existed, which can be a formal organization or an association of individuals.
Pattern of Racketeering Activity: The defendant engaged in a pattern of racketeering, meaning at least two related predicate offenses (specific crimes listed in the RICO statute).
Injury: The plaintiff suffered an injury to their business or property as a result of the racketeering activity.

Traditionally, RICO claims have been largely confined to injuries to “business or property,” excluding personal injuries. However, the Supreme Court’s recent decision blurs this line, creating new possibilities for personal injury plaintiffs.

The Supreme Court’s Decision in Medical Marijuana, Inc. v. Horn

The Horn case involved a commercial truck driver who lost his job after failing a drug test. Douglas Horn had been using a CBD product, “Dixie X,” which was advertised as THC-free. However, the product contained THC, causing Horn to fail the drug test and subsequently lose his employment.

Horn sued Medical Marijuana, Inc., the product’s manufacturer, under RICO, alleging that the company engaged in mail and wire fraud by falsely advertising the product. The District Court initially ruled against Horn, arguing that his lost earnings stemmed from a personal injury (ingesting THC) and were therefore not recoverable under RICO.

The Second Circuit reversed this decision, and the Supreme Court affirmed the Second Circuit’s ruling. In a 5-4 decision authored by Justice Amy Coney Barrett, the Court held that a plaintiff can seek damages for business or property loss under civil RICO, even if that loss resulted from a personal injury. The Court clarified that the injury limitation in the civil RICO statute focuses on the kind of harm for which a claim may be brought (business or property), not the cause of that harm.

The Supreme Court offered a hypothetical example to illustrate the ruling’s practical effect: a gas station owner beaten in a robbery cannot recover for their pain and suffering under RICO. However, if the injuries from the robbery force the owner to shut down the business, they can recover for the loss of business.

Impact on Personal Injury Lawsuits

This ruling has significant implications for personal injury law:

Expanded Scope of RICO: The decision broadens the scope of civil RICO, allowing plaintiffs to pursue claims for economic harm (e.g., lost wages, medical expenses) that result from a personal injury caused by racketeering activity.
New Avenues for Recovery: Personal injury plaintiffs may now have an additional avenue for recovery in cases involving fraudulent or deceptive practices. For example, individuals injured by defective products that were falsely advertised could potentially bring a RICO claim against the manufacturer.
Treble Damages: One of the most attractive aspects of RICO is the potential for treble damages – three times the actual damages sustained. This can significantly increase the potential recovery in a personal injury case.
Increased Litigation: The ruling may lead to an increase in RICO lawsuits, as plaintiffs’ attorneys seek to leverage the expanded scope of the Act.
Focus on Economic Harm: The decision emphasizes the importance of demonstrating economic harm in personal injury cases. Plaintiffs will need to carefully document and quantify their financial losses to succeed on a RICO claim.

Potential Challenges and Limitations

Despite the expanded scope of RICO, personal injury plaintiffs still face several challenges:

Proving a Pattern of Racketeering Activity: Establishing a pattern of racketeering activity requires demonstrating that the defendant engaged in at least two related predicate offenses. This can be a difficult task, requiring extensive investigation and evidence.
Direct Causation: Plaintiffs must demonstrate a direct connection between the racketeering activity and their economic harm. This can be challenging, especially in cases involving multiple factors that contributed to the injury.
The “Enterprise” Requirement: Plaintiffs must prove the existence of an “enterprise” engaged in racketeering activity. This requires demonstrating that the defendants were organized in some fashion to carry out the illegal conduct.
Judicial Interpretation: The full impact of the Horn decision will depend on how lower courts interpret and apply it in future cases. It is possible that courts may adopt a narrow interpretation of the ruling, limiting its impact on personal injury litigation.

Concerns and Criticisms

The Supreme Court’s decision has also drawn criticism from some quarters. Dissenting justices and business groups have expressed concerns that the ruling could lead to a flood of RICO lawsuits, transforming traditional personal injury claims into federal cases. They argue that the decision effectively eliminates RICO’s “business or property” limitation, opening the door to abuse and over-litigation.

The Supreme Court acknowledged the potential for an undue proliferation of RICO suits but stated that it is up to Congress to limit the claims if needed. This suggests that Congress may consider amending the RICO statute to address concerns about its expanded scope.

What This Means For You

For potential plaintiffs: If you have suffered a personal injury that resulted in economic harm due to fraudulent or deceptive practices, it is crucial to consult with an attorney to explore whether a RICO claim is viable.
For businesses: Review your business practices and ensure compliance with all applicable laws and regulations to minimize the risk of a RICO lawsuit.
For attorneys: Stay informed about developments in RICO law and understand the implications of the Horn decision for your clients.

The expansion of RICO to include economic damages stemming from personal injury marks a significant shift in the legal landscape. While it offers new opportunities for plaintiffs, it also presents challenges and raises concerns about potential over-litigation. As the law evolves, it is essential to stay informed and seek expert legal guidance to navigate this complex area.

Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. You should consult with an attorney to discuss your specific legal situation.