RJR Nabisco et al. v. European Community et al.
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.