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Martin Flumenbaum and Brad S. Karp

In an instance of first impression for any U.S. Court of Appeals, the Second Circuit, in Bascuñán v. Elsaca, 874 F.3d 806 (2d Cir. 2017), created a broad rule for what constitutes a “domestic injury” under §1964(c) of the Racketeer Influenced and Corrupt Organizations Act (RICO), the “civil RICO” statute. In RJR Nabisco v. European Community, 136 S. Ct. 2090 (2016), the Supreme Court had held that private right of actions pursuant to §1964(c) do not apply extraterritorially, but rather, require a domestic injury. Id. at 2095; see also 18 U.S.C. §1964(c). The Supreme Court, however, left open what it means for an injury to be “domestic.” RJR Nabisco, 136 S. Ct. at 2093. In Bascuñán v. Elsaca, the Second Circuit finally addressed that question in an opinion written by Circuit Judge José Cabranes, joined by Circuit Judge Debra Ann Livingston and District Judge Willian H. Pauley III, sitting by designation. The court ultimately held that a plaintiff’s place of residence may not be the sole factor in determining whether an injury is “domestic,” and mandated that a broader range of factors must be considered, including where the alleged conduct occurred and where the plaintiff’s business or property was located.

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