The Supreme Court heard arguments today in a case involving whether the Racketeer Influenced and Corrupt Organizations (RICO) Act can cover injuries suffered from a job loss. Since RICO provides for treble damages and attorneys fees, the implications in Medical Marijuana, Inc. v. Horn are significant for businesses.
Truck driver Douglas Horn suffered from chronic pain as the result of a trucking accident. He claims the makers of a hemp-based product, Dixie X, misrepresented that the drug did not contain THC, the active ingredient in marijuana. When Horn later failed his employer’s drug test and lost his job, he filed suit under RICO claiming the manufacturer committed mail and wire fraud.
“We’re trying to get redress for his loss of income from being fired,” Horn’s attorney Easha Anand told the justices. “There was reasonable reliance on the [other side’s] misrepresentation. He asked directly if it had THC.”
Justice Clarence Thomas countered that the medical marijuana did not fire her client. But Anand noted that “lost employment is a classic business injury.”
The Second Circuit Court of Appeals had ruled last year in Horn’s favor because the term “business” encompasses employment. Therefore, he had suffered an injury to “his business” under RICO.
Representing Medical Marijuana, Inc., at the Supreme Court, Lisa S. Blatt told the justices that no one under the RICO statute can ever recover for personal injuries. “Under [plaintiff’s view], all personable injuries are recoverable under RICO,” said Blatt.
The Court’s three liberal members expressed skepticism with Blatt’s theory. For instance, Justice Ketanji Brown Jackson asked, “Isn’t the testing and firing where his injury comes in? He’s not saying the product itself injured him.”
Justice Elena Kagan added, “The statute doesn’t say what you’ve been injured by, just if you’ve been injured in your business” which she suggested Horn had by losing his job due to the failed drug test.
But Blatt suggested that RICO was never meant to extend to these types of cases. “Their view cannabilizes tort law,” she said.
A decision in the case is expected before the end of the Supreme Court’s term in June.
