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The Archdiocese of Philadelphia may not be sued under RICO for its alleged cover-up of sexual abuse by priests because the alleged victims cannot show they suffered RICO-style injury that was caused by the cover-up, a federal judge has ruled.

In his 30-page opinion in Magnum v. Archdiocese of Philadelphia, U.S. District Judge Legrome D. Davis found that the RICO claims suffered from numerous fatal flaws.

Davis said the plaintiffs failed to allege any conduct that qualified as “racketeering activity” and that the plaintiffs “alleged emotional distress, loss of earnings and decreased earnings capacity are personal injuries insufficient to confer RICO standing.”

The decision came just one day before the Pennsylvania General Assembly passed a bill that promises to make sweeping changes to Pennsylvania’s child sex-abuse laws, including some that were recommended by a Philadelphia grand jury that investigated alleged abuse by Roman Catholic priests.

If Gov. Edward G. Rendell signs the bill, victims of child-sex crimes will have until their 50th birthday — 20 years longer than current law allows — to file criminal complaints. Employers and supervisors could be held criminally liable if they know of alleged abuse by employees who care for children but fail to stop it, and caregivers would have to report suspected abuse regardless of whether the victim reports it.

Kathleen McDonnell, the legislative director for the Pennsylvania District Attorneys Association, said the bill would ensure that organizations serving or caring for children take responsibility for preventing and stopping child-sex abuse by their employees.

“The entire package will protect Pennsylvania’s children from loopholes that were used by the organizations to not be accountable for their conduct,” McDonnell said.

Davis, in his ruling, suggested that Congress, too, should consider legislation, saying he recognized that the plaintiffs had raised serious allegations, but that their claims were not valid under existing RICO or federal civil rights laws.

“It is the duty of the judiciary to apply the law as it has been written, and as such this court cannot force a moral wrong into a legal mold where it clearly does not fit. The remedy lies with Congress, not with the courts,” Davis wrote.

The suit, filed by attorneys Stewart J. Eisenberg and James A. Wells of Eisenberg Rothweiler Winkler Eisenberg & Jeck, claimed that the archdiocese engaged in a large-scale cover-up of alleged child abuse perpetrated by individual priests.

The abuse alleged in the suit spanned three decades — from 1955 to 1985 — and ranged from inappropriate fondling to instances of forcible oral, anal or vaginal rape.

Many of the allegations in the suit were drawn from the 400-page report of the Philadelphia grand jury, and the plaintiffs sought to proceed as a class action, claiming there are up to 500 members of the plaintiff class and at least 63 priests who are known to have engaged in the sexual molestation of children.

The alleged cover-up continued until at least 2002, the suit said, and amounted to a campaign to protect the accused priests despite endangering more children.

When confronted with complaints and evidence of abuse, the suit alleged, church officials simply ignored the allegations and allowed or even in some instances encouraged the suspected priests to continue working in the parishes.

In other cases, the suit said, church officials coerced or improperly influenced

complaining families to keep quiet, transferred priests with known and unresolved allegations of abuse to different parishes so as to “hide” them, or feigned internal investigations in order to prevent complainants from going to the authorities.

But lawyers for the archdiocese — C. Clark Hodgson, Michael D. O’Mara and Christine M. Debevec of Stradley Ronon Stevens & Young — moved for dismissal of the suit, arguing that the suit failed to meet the strict requirements for pleading a valid RICO claim.

Now Davis has adopted many of the defense arguments, finding that the plaintiffs lacked standing under RICO because they failed to allege that the cover-up caused any injury to their “business or property.”

In the suit, the plaintiffs alleged three types of RICO injuries that they said stemmed from the alleged cover-up — severe emotional distress as a result of sexual abuse, resulting in loss of earnings and decreased earnings capacities; out-of-pocket medical and psychological treatment expenses; and loss of the ability to pursue personal injury claims as a result of the running of the statute of limitations.

But the courts, Davis said, have interpreted the requirement of injury to “business or property” to exclude “personal injuries and the economic losses derived therefrom.”

Even a generous reading of the RICO statute would not help the plaintiffs, Davis said, because they “do not allege that they lost any particular employment through defendants’ conduct, only that the trauma they suffered from the alleged sexual abuse made them less productive and less successful in their careers than they otherwise would have been, resulting in reduced earnings.”

As a result, Davis said he was “compelled to conclude that plaintiffs’ alleged emotional distress, loss of earnings and decreased earnings capacity are personal injuries insufficient to confer RICO standing.”

Likewise, Davis found that the plaintiffs’ alleged out-of-pocket medical and psychological treatment expenses were also insufficient to support a RICO claim.

“While such expenses do represent concrete financial losses, they nevertheless clearly derive from the plaintiffs’ personal injury claim of emotional distress,” Davis wrote.

“As a matter of logic, it makes little sense to recognize such a pecuniary consequence as a RICO injury when the direct personal injury itself is legally insufficient.”

Davis also rejected the plaintiffs’ theory that the cover-up caused them to lose the chance to bring legal claims that would have resulted in monetary recovery if they had been filed in time.

“While this is a somewhat novel pleading of injury, the court nevertheless concludes … that plaintiffs’ lost tort claims are not injuries to ‘business or property,’” Davis wrote.

“First, there is little legal support for the argument that the loss of an opportunity to recover for a tort is a cognizable RICO injury,” Davis wrote.

Davis also found that Pennsylvania law would not allow the plaintiffs to classify an “unliquidated tort claim” as “property” and the loss of the opportunity to assert those claims a deprivation of that property.

“While RICO is a federal cause of action, numerous circuits have held that the determination of whether a particular interest is properly considered ‘property’ for injury to ‘business or property’ purposes is governed by state law,” Davis wrote.

Under Pennsylvania law, Davis said, “an unliquidated personal injury tort claim is decidedly not a property right.”

But even if it were, Davis said, “determining the value of that injury for compensatory purposes would be a wholly speculative exercise.”

As a result, Davis concluded that the plaintiffs had no valid RICO claims because their claim of injury “is entirely contingent on the assumption that they would have prevailed in their individual tort claims in state court had they asserted them in a timely manner.”

In the final section of the opinion, Davis rejected the plaintiffs’ claims under Section 1985 of the Civil Rights Act.

To recover under Section 1985, Davis said, a plaintiff must show “some class-based discriminatory animus” as well as the intention to deprive a right guaranteed against private impairment.

The plaintiffs’ lawyers argued that their clients were members of a protected class because they were “at all relevant times minor children” or “members of the Roman Catholic Church.”

But Davis found that neither designation met the law’s requirements because the U.S. Supreme Court has held that Section 1985 plaintiffs must be “victims of historically pervasive discrimination” or those with “immutable characteristics.”

The courts, Davis said, have consistently refused to recognize claims of religious animus under Section 1985.

But even if the law extended to religious animus, Davis found the suit would still fail because the plaintiffs did not allege that any of the alleged conduct by the archdiocese was committed “by reason of” that animus.

“Rather, plaintiffs allege only that defendants preyed on the vulnerabilities of plaintiffs as members of those groups in carrying out their acts,” Davis wrote.

Finally, Davis found that the suit failed to allege any violation of a right that is protected under Section 1985 against private impairment.

“Plaintiffs only claim violations of their ‘substantive due process rights to bodily integrity’ and ‘substantive rights created under state law designed to protect minor children.’ … However, there is no allegation that defendants’ conduct impinged on plaintiffs’ rights to interstate travel and to be free from involuntary servitude, the only two rights recognized under Section 1985 to be protected from private encroachment,” Davis wrote.

The Associated Press contributed to this report.

(Copies of the 30-page opinion in
Magnum v. Archdiocese of Philadelphia , PICS No. 06-1641, are available from The Legal Intelligencer . Please call the Pennsylvania Instant Case Service at 800-276-PICS to order or for information. Some cases are not available until 1 p.m.) •

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