RJR Nabisco, Inc. v. European Community

The U.S. Supreme Court ruled that RJR Nabisco could not be sued under the federal Racketeer Influenced and Corrupt Organizations (RICO) Act for its conduct abroad. The European Union (known as the European Community in this case) sued RJR Nabisco claiming that the company directed and managed a global smuggling and money-laundering scheme with organized crime groups in violation of the RICO law. In this decision, the Supreme Court ruled that certain elements of RICO can apply to conduct that occurs outside of the United States. However, the Court also found that a private entity— this case, a foreign government­—cannot sue under RICO in the United States unless it has suffered a domestic injury. Because the European Union had earlier waived its claims of a domestic injury, the Court was forced to dismiss the EU’s remaining claims. 

RJR Nabisco, Inc., et al. v. European Community, et al., No. 15-138 (2016).

  • United States
  • Jun 20, 2016
  • U.S. Supreme Court

Parties

Plaintiff

  • Nabisco Group Holdings Corp.
  • R.J. Reynolds Global Products, Inc.
  • R.J. Reynolds Tobacco Company
  • R.J. Reynolds Tobacco Company, a North Carolina Corporation
  • R.J. Reynolds Tobacco Holdings, Inc.
  • R.J. Reynolds Tobacco International, Inc.
  • Reynolds American Inc.
  • RJR Acquisition Corp., f/k/a Nabisco Group Holdings Corp.
  • RJR Nabisco Holdings Corp.
  • RJR Nabsico, Inc.

Defendant European Community, acting on its own behalf and on behalf of the Member States it has power to represent, Kingdom of Belgium, Republic of Finland, French Republic, Hellenic Republic, Federal Republic of Germany, Italian Republic, Grand Duchy of Luxembourg, Kingdom of the Netherlands, Portugese Republic, Kingdom of Spain, Individually, Kingdom of Denmark, Czech Republic, Republic of Lithuania, Republic of Slovenia, Republic of Malta, Republic of Hungary, Republic of Ireland, Republic of Estonia,

Legislation Cited

Related Documents

Type of Litigation

Tobacco Control Topics

Substantive Issues

Type of Tobacco Product

None

"Greatly simplified, the complaint alleges a scheme in which Colombian and Russian drug traffickers smuggled narcotics into Europe and sold the drugs for euros that— through a series of transactions involving black-market money brokers, cigarette importers, and wholesalers— were used to pay for large shipments of RJR cigarettes into Europe. In other variations of this scheme, RJR allegedly dealt directly with drug traffickers and money launderers in South America and sold cigarettes to Iraq in violation of international sanctions. RJR is also said to have acquired Brown & Williamson Tobacco Corporation for the purpose of expanding these illegal activities. The complaint alleges that RJR engaged in a pattern of racketeering activity consisting of numerous acts of money laundering, material support to foreign terrorist organizations, mail fraud, wire fraud, and violations of the Travel Act. RJR, in concert with the other participants in the scheme, allegedly formed an association in fact that was engaged in interstate and foreign commerce, and therefore constituted a RICO enterprise that the complaint dubs the “RJR Money-Laundering Enterprise.” ...Putting these pieces together, the complaint alleges that RJR violated each of RICO’s prohibitions."