Defendants facing racketeering claims with an international twist have been quick to cite the U.S. Supreme Court’s 2010 decision in Morrison v. National Australia Bank, which sharply curtailed the international application of U.S. securities laws. And Morrison has indeed offered a lifeline to some defendants in Racketeer Influenced and Corrupt Organizations Act cases whose alleged wrongdoing took place overseas. But, as Alcoa Inc. recently learned, the ruling is no silver bullet.
In June, U.S. District Judge Donetta Ambrose in Pittsburgh refused to dismiss a four-year-old civil RICO case brought by Bahrain Aluminum B.S.C. (Alba) against Alcoa. Alba accused the aluminum giant of bribing senior Alba officials and members of the Bahraini government in an (unsuccessful) attempt to induce the smaller target company to cede a controlling interest to Alcoa. The litigation had been stayed for three years pending the outcome of a federal probe, but in November, Alcoa’s lawyers at Cravath, Swaine & Moore and K&L Gates persuaded Ambrose to lift the stay so that they could finally move to dismiss the case. The results weren’t quite what the lawyers had in mind.
