The issue of whether the Racketeer Influenced and Corrupt Organizations, or RICO, Act applies extraterritorially — to events occurring and injuries suffered outside the United States — is one that remained unresolved until the U.S. Supreme Court’s opinion Monday.
After years of inconsistent lower court rulings, the Supreme Court ruled in RJR Nabisco v. European Community that although substantive provisions of the RICO Act prohibit certain conduct abroad, if the plaintiff does not allege an injury in the United States, there can be no RICO liability. Prior to this ruling, lower courts have been split — with, for example, the U.S. Court of Appeals for the Second Circuit holding that RICO can apply extraterritorially, while the Ninth and Eleventh circuits held it could not.
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