AIM RECYCLING FLORIDA, LLC et al v. METALS USA, INC., et al
Filing
276
OMNIBUS ORDER denying 261 Motion for Summary Judgment; denying 263 Motion for Partial Summary Judgment. Signed by Judge Beth Bloom on 1/13/2020. See attached document for full details. (ra)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 18-cv-60292-BLOOM/Valle
AIM RECYCLING OF FLORIDA, LLC
and LKQ PICK YOUR PART
SOUTHEAST, LLC,
Plaintiffs,
v.
METALS USA, INC., UNIVERSAL
SCRAP MANAGEMENT, LLC, OBED
LENDIAN, and SAMUEL ABREU,
Defendants.
___________________________________/
OMNIBUS ORDER
THIS CAUSE is before the Court upon Plaintiffs AIM Recycling of Florida, LLC (“AIM”)
and LKQ Pick Your Part Southeast, LLC’s (“LKQ”) (collectively, “Plaintiffs”) Renewed Motion
for Partial Summary Judgment as to Liability, ECF No. [263] (“Plaintiffs’ Motion for Summary
Judgment”), and Defendants Metals USA, Inc. (“Metals USA”) and Obed Lendian’s (“Lendian”)
(collectively, “Defendants”) Motion for Summary Judgment, ECF No. [261] (“Defendants’
Motion for Summary Judgment”), (collectively, the “Motions”). The Court has reviewed the
Motions, all opposing and supporting submissions, the record in this case, the applicable law, and
is otherwise fully advised. For the reasons set forth below, Plaintiffs’ Motion for Summary
Judgment is denied, and Defendants’ Motion for Summary Judgment is denied.
Case No. 18-cv-60292-BLOOM/Valle
I.
BACKGROUND
On February 9, 2018, Plaintiffs initiated the instant RICO1 action against Metals USA and
Samuel Abreu (“Abreu”), alleging a multi-year conspiracy to steal valuable scrap metal from
Plaintiffs’ facility, ECF No. [1], and the case was originally assigned to the Honorable William J.
Zloch, ECF No. [2]. On April 10, 2018, Plaintiffs amended their Complaint, naming Lendian and
Universal Scrap Management, LLC (“Universal”) as additional Defendants. ECF No. [24]
(“Amended Complaint”).2 Plaintiffs’ Amended Complaint asserts five counts: Count I (Civil
RICO – Violations of 18 U.S.C. § 1962(c)); Count II (Civil RICO Conspiracy – Violations of 18
U.S.C. § 1962(d)); Count III (Florida Civil RICO and Remedies for Criminal Activities); Count
IV (Florida Civil RICO and Remedies for Criminal Activities – Conspiracy); and Count V (Unjust
Enrichment). Id.3
Believing that the Department of Justice (“DOJ”) planned to indict them on criminal
charges, on March 1, 2019, Defendants filed a Motion for Temporary Stay. ECF No. [122]. On
April 4, 2019, Judge Zloch granted the Motion for Temporary Stay, pending the resolution of
Defendants’ parallel criminal case. ECF No. [146]. On June 27, 2019, the instant action was
reassigned to the undersigned. ECF No. [147]. Moreover, on August 26, 2019, the DOJ provided
Defendants with a declination letter, indicating that the criminal investigation was closed and that
the DOJ would not be prosecuting. ECF No. [151] at 1-2. On August 28, 2019, after being advised
that the DOJ was closing its criminal investigation into Defendants, this Court lifted the stay. ECF
No. [154].
Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1961, et seq.
The Motions before the Court today pertain only to Defendants Metals USA and Lendian, and any
reference in this Order to “Defendants” should be understood as referring only to Metals USA and Lendian.
The two other Defendants in this case — i.e., Abreu and Universal — will be referred to as such.
3
Counts I-IV of Plaintiffs’ Amended Complaint are asserted against Metals USA, Lendian, Universal, and
Abreu, whereas Count V is brought against Metals USA, Lendian, and Universal. ECF No. [24].
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Before this action was stayed pending Defendants’ criminal prosecution, on February 15,
2019, Plaintiffs filed a Motion for Partial Summary Judgment as to Liability, ECF No. [120], and
corresponding Statement of Material Facts in Support of Plaintiffs’ Motion for Partial Summary
Judgment as to Liability, ECF No. [119], which was never resolved prior to the case being stayed.
On August 29, 2019, after this Court lifted the stay, Plaintiffs filed a Renewed Motion for
Partial Summary Judgment, ECF No. [158], incorporating the Statement of Material Facts from
their original Motion, ECF No. [119]. On September 23, 2019, Defendants filed a Motion for
Summary Judgment, ECF No. [177], and accompanying Statement of Material Facts, ECF No.
[178]. On October 28, 2019, Plaintiffs moved to supplement the summary judgment record with
certified English translations of telephone recordings of allegedly incriminating conversations
between Abreu and Lendian. ECF No. [238].4 This Court granted Plaintiffs’ motion to supplement
the summary judgment record and ordered the parties to revise their summary judgment briefing
to address this supplemental evidence. ECF No. [258].
On November 26, 2019, pursuant to this Court’s Order, Plaintiffs filed their Renewed
Motion for Partial Summary Judgment, ECF No. [263], along with their corresponding
Supplemented Statement of Material Facts, ECF No. [264] (“Plaintiffs’ SOF”). Plaintiffs’ SOF
sets forth many facts that are premised upon adverse inferences derived from Lendian’s invocation
of his Fifth Amendment rights during his deposition due to the forthcoming criminal prosecution.
Id. at 8-11. On December 10, 2019, Defendants filed their Response in Opposition to Plaintiffs’
Motion for Summary Judgment, ECF No. [267] (“Response to Plaintiffs’ Motion for Summary
Judgment”), along with their Amended Counterstatement of Disputed Material Facts, ECF No.
4
During these telephone calls, Lendian and Abreu were conversing in Spanish. Plaintiffs have not submitted
the recordings themselves as summary judgment evidence. Instead, Plaintiffs submitted transcripts of these
recordings with English translations, ECF Nos. [264-8] & [264-9], in support of their current Motion for
Summary Judgment.
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[272] (“Defendants’ CSOF”). Defendants’ CSOF included as an attachment Lendian’s sworn
affidavit asserting additional facts, to which he previously could not testify, in order to rebut the
adverse inferences derived from his prior Fifth Amendment invocation. ECF No. [272] at 20-30.
On December 17, 2019, Plaintiffs submitted their Reply, ECF No. [275].
Likewise, on November 26, 2019, Defendants filed their Motion for Summary Judgment,
ECF No. [261], and accompanying Statement of Material Facts, ECF No. [262] (“Defendants’
SOF”). On December 10, 2019, Plaintiffs filed their Response to Defendants’ Motion for Summary
Judgment, ECF No. [270] (“Response to Defendants’ Motion for Summary Judgment”), and their
corresponding Counter Statement of Material Facts, ECF No. [271] (“Plaintiffs’ CSOF”), to which
Defendants filed a Reply, ECF No. [274].
II.
MATERIAL FACTS
Based on the parties’ statements and counterstatements of material facts, along with the
evidence in the record, the following facts are not genuinely in dispute unless otherwise noted.
Plaintiffs operate an industrial scrap metal facility with approximately forty employees.
Dep. of Plaintiffs’ Corp. Representative 36:5-7, ECF No. [272] at 42-216 (“Gerding Dep.”).
Plaintiffs’ facility “takes [] end-of-life crush cars and runs them through a massive shredding
operation which separates — which hammers up the cars and separates the metals from the car
and the waste into ferrous material, nonferrous material, and waste.” Hr’g on Mot. for Prelim. Inj.
Tr. 10:18-21,5 ECF No. [264-2] (“Hr’g Tr.”). Plaintiffs’ facility primarily produces ferrous shred,
which they then sell to customers domestically and internationally. Hr’g Tr. 14:18-20.
In this Order, any citations to the page numbers from the transcript of the Hearing on Plaintiffs’ Motion
for Preliminary Injunction are based on the Case Management/Electronic Case Files system’s (“CM/ECF”)
pagination, rather than the page numbers listed on the actual transcript, which are obstructed by the
CM/ECF Bates stamp.
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Metals USA operates a metal recycling facility that buys, cuts, and resells different kinds
of metals. Dep. of Javier Fleites 21:10-22:24, ECF No. [264-3] (“Fleites Dep.”); Dep. of Metals
USA’s Corp. Representative 13:16-17, ECF No. [264-4] (“Metals Dep.”). Lendian owns Metals
USA and is involved in every aspect of Metals USA’s operation and decision making, including
hiring and firing employees, entering into contracts on behalf of the company, and determining the
market rate for materials that Metals USA purchases. Fleites Dep. 51:16-25; Metals Dep. 107:1921; Dep. of Roberto Rodriguez 98:15-17, ECF No. [264-5] (“Rodriguez Dep.”).
Around December 2017, Plaintiffs’ operations controller, Fritz Gerding, noticed a
significant discrepancy between the physical amount of shred inventory stored at the facility and
the amount of inventory listed in company records for accounting purposes. Hr’g Tr. 17:2-7;
Gerding Dep. 39:14-41:24. Based on this discrepancy, Gerding and Plaintiffs’ general manager,
Walter Griessier, began an internal investigation to determine the cause of the inventory
discrepancy. Hr’g Tr. 17:18-18:3; Gerding Dep. 42:9-16. During their investigation, Gerding and
Griessier enlisted the help of another employee at Plaintiffs’ facility, Pedro Torres (“Torres”), who
they felt would provide valuable knowledge about the facility’s systems and operations. Hr’g Tr.
18:17-19:11; Gerding Dep. 42:17-43:10. Torres operated the truck scale to measure the incoming
and outgoing weights of vehicles passing through Plaintiffs’ facility, which were then used to
determine the amount of scrap metal purchased from particular customers. Hr’g Tr. 18:17-19:11.
Ultimately, Torres confessed to Gerding and Griessier that he was aware of a theft scheme at
Plaintiffs’ facility that he had taken part in. Hr’g Tr. 19:16-19; Gerding Dep. 43:10-17. During his
confession, Torres implicated numerous other employees who were involved in the theft scheme,
including Samuel Abreu. Hr’g Tr. 22:1-6, 25:6-8; Gerding Dep. 58:19-60:11. With Torres’s help,
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Gerding and Griessier were later able to capture Abreu on video paying Torres an envelope of
$3,000.00 in cash. Hr’g Tr. 56:3-16; Gerding Dep. 61:2-64:25.
Abreu worked as a loader operator at Plaintiffs’ scrap metals facility from April 2014 to
February 2018. Aff. of Samuel Abreu, ECF No. [264-1] ¶ 2 (“Abreu Aff.”). In April 2014, Abreu’s
co-worker, Jose Rodriguez,6 confided in him that multiple employees at Plaintiffs’ facility had
been stealing scrap metal. Id. ¶ 4. Jose Rodriguez explained that the employees involved would
enter the facility with trucks early in the morning, load those trucks with Plaintiffs’ scrap metal,
and then direct those trucks out of Plaintiffs’ facility to deliver the loads of stolen scrap to a location
that Abreu later learned was Metals USA. Id. ¶¶ 4-5. After learning about the theft scheme, Jose
Rodriguez began paying Abreu weekly for his silence, and these payments continued until the end
of 2015. Id. ¶¶ 6-7. During this time, Jose Rodriguez was the “chief person working at AIM that
was in charge of stealing and delivering these stolen goods.” Hr’g Tr. 151:23-152:5.
Abreu testified that, at the end of 2015, he was approached by a man named Ruben
Encarnacion about taking over for Jose Rodriguez in the theft operation because Jose Rodriguez
had become too unreliable. Abreu Aff. ¶ 7; Hr’g Tr. 146:15-147:9. Although he was not employed
by Plaintiffs, Encarnacion was a known broker who had previous business interactions at
Plaintiffs’ facility where he “would broker loads of cars to AIM for shredding.” Hr’g Tr. 90:7-9.
In early 2016, Encarnacion facilitated an initial in-person meeting between Abreu and Lendian,
during which Abreu alleged that Lendian offered him $100.00 for every ton of scrap metal stolen.
Abreu Aff. ¶¶ 8-9; Hr’g Tr. 148:9-149:5. Defendants, however, contend that Lendian never
instructed Abreu to steal anything, nor did Lendian offer to pay Abreu for Plaintiffs’ stolen scrap.
Defendants point to Metals USA’s Customer History Report, which shows the fluctuating prices
6
In the interest of clarity, the Court will refer to Jose Rodriguez by his full name, whereas Roberto
Rodriguez will be referred to as “Rodriguez.”
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Metals USA paid per ton to Abreu on transactions from January 2015 through December 2017.
Aff. of Obed Lendian, ECF No. [272] at 23, ¶ 19 (“Lendian Aff.”); ECF No. [264-7] (“Customer
History Report”). Thereafter, Abreu took Jose Rodriguez’s place as the main orchestrator of the
theft scheme at Plaintiffs’ facility and involved more employees to expand the operation. Abreu
Aff. ¶¶ 10, 12; Hr’g Tr. 151:2-152:5.
Abreu claims that Lendian was the ringleader of the theft ring who controlled all aspects
of the scheme and instructed Plaintiffs’ employees on when to steal, the quantity to steal, where to
deliver the stolen items, and the price of the stolen goods. Hr’g Tr. 100:23-101:13. Defendants, on
the other hand, state that Lendian had no knowledge that the materials Abreu delivered were stolen,
and that he never instructed Plaintiffs’ employees to steal anything, nor did he have any control
over the individuals participating in the scheme. Lendian Aff. at 22, ¶¶ 12-15. The employees who
confessed their involvement in the theft ring implicated Abreu during their confessions, not
Lendian. Hr’g Tr. 24:22-25:8; Gerding Dep. 71:15-72:8.
Defendants disagree with Plaintiffs’ characterization of Metals USA’s business
relationship with Abreu. It is undisputed that Encarnacion was one of Lendian’s business contacts
who, around the end of 2014, approached Lendian about serving as a broker between Metals USA
and a supplier who had scrap metal to sell. Lendian Aff. at 22, ¶¶ 6-7; Fleites Dep. 113:2-12. The
supplier Encarnacion brokered for was Abreu. Fleites Dep. 120:10-13; Metals Dep. 27:5-6;
Rodriguez Dep. 45:17-19. Pursuant to this agreement, Encarnacion worked as Abreu’s broker to
deliver loads of ferrous scrap and collect payments on behalf of Abreu’s company. Fleites Dep.
121:19-23; Metals Dep. 27:25-28:6; Rodriguez Dep. 46:6-15. Lendian states that, around June
2015, Abreu approached him and told him that Encarnacion would no longer be his broker or have
authorization to collect payments on Abreu’s behalf. Lendian Aff. at 22, ¶¶ 10-11. Thereafter,
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Abreu stopped using Encarnacion as a broker to deliver loads of scrap to Metals USA. Fleites Dep.
121:3-5; Metals Dep. 35:1-3; Rodriguez Dep. 51:3-22.
Plaintiffs contend that Abreu was Metals USA’s only customer who delivered material that
had been processed through a large industrial shredder. Fleites Dep. 157:9-12, 161:16-19; Metals
Dep. 68:10-13. Defendants, however, dispute that the material Abreu was selling to Metals USA
was produced by a large industrial shredder, explaining instead that the material “could have been
produced by a small shredder. . . . Once metal has been processed through a shredder, it becomes
indistinguishable from other metal that has run through a shredder. There is no way to determine
the identity or size of the shredder.” Lendian Aff. at 25, ¶ 34.
Although it is undisputed that Metals USA did not know the name of Abreu’s company,
Metals USA employees understood that Abreu owned the company responsible for making the
deliveries. Fleites Dep. 119:8-17; Metals Dep. 59:12-16; Rodriguez Dep. 46:12-19 (“Q. How is it
that you came to understand that Ruben was working for Samuel Abreu? A. Because Samuel was
the owner of the business, the owner of the load. Q. How did you come to know that? Who told
you? A. The people themselves who were working there. Guys from Samuel who were coming.”).
Further, the parties do not dispute that Metals USA never recorded the driver’s license information
of any of Abreu’s drivers, Fleites Dep. 33:7-14, and Defendants maintain that they were not legally
required to record such information, Lendian Aff. at 24, ¶ 30; Fleites Dep. 33:7-35:3. Instead,
Defendants allege that Metals USA was only required to record the driver’s license information
for the owner of the material being sold, which it did in Abreu’s case, in addition to keeping
detailed records of each delivery Abreu made. Lendian Aff. at 24, ¶ 30; Fleites Dep. 33:7-35:3.
Defendants primarily paid Abreu in cash for the loads of scrap sold, although they also
occasionally paid Abreu by check. Metals Dep. 55:17-56:2; see generally Customer History
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Report. Most of Metals USA’s largest clients were paid in either cash or check, based on what the
owner of the company requested, and payment would be disbursed to the owner of the company
or any individuals authorized to collect payment on the owners’ behalf. Metals Dep. 53:6-55:7.
Either Abreu or an authorized family member went to Metals USA’s facility multiple times a week
to pick up Abreu’s payment. Metals Dep. 55:8-16; Rodriguez Dep. 81:25-82:10. When collecting
payment, Abreu would almost always remain in his vehicle outside of the Metals USA yard and
either Fleites or Rodriguez would deliver the payment to him. Metals Dep. 52:20-25; Lendian Aff.
at 25, ¶ 36; Rodriguez Dep. 84:18-85:2 (“Because he didn’t want to get out. At the beginning he
got out once or twice but then he did not want to get out so he would remain in his car, welldressed. And then I would provide him with the money outside. The thing is that our yard has no
parking. I would hand him his money, then he would leave.”).
It is undisputed that Abreu made a total of 538 deliveries to Metals USA between 2015 and
2018, for which he was paid $4,544,282.95. Fleites Dep. 131:20-132:5; see generally Customer
History Report. During this period, Abreu was one of Metals USA’s five largest clients. Metals
Dep. 18:12-15. Metals USA ultimately resold the scrap metal purchased from Abreu to clients
domestically and abroad, including to Plaintiffs. Lendian Aff. at 23, ¶ 21; ECF No. [272] at 31-33.
After uncovering the theft ring and obtaining confessions from numerous employees
involved, Plaintiffs initiated the instant action on February 9, 2018. ECF No. [1]. Eventually,
Abreu began cooperating with the DOJ. Hr’g Tr. 111:24-112:2. Beginning in February 2018,
pursuant to this cooperation and unbeknownst to Lendian, Abreu began recording his telephone
conversations with Lendian at the DOJ’s request. Hr’g Tr. 120:14-18, 161:2-6.
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It is undisputed that, during these phone conversations, Lendian suggested that Abreu flee
the country rather than face years in prison if convicted for his involvement in the theft ring.7 ECF
No. [264-8] at 18-20. Likewise, the parties do not dispute the fact that Lendian stated that he and
Abreu needed to be on the “same page” regarding their testimony as to the quality of the materials
Abreu sold to Metals USA. Id. at 64, 78. It is further undisputed that Lendian told Abreu not to
divulge the identities of the truck drivers who worked for Abreu because they would “give [Abreu]
up.” Id. at 83. Beyond these undisputed facts, however, the parties share differing versions of what
transpired.
On the one hand, Plaintiffs set forth the following facts based on the recordings: (1)
Lendian started taking steps to transfer his assets out of the United States upon learning of this
lawsuit, ECF No. [264-8] at 45; (2) Lendian asked Abreu to lie to his attorney to cover up for
Lendian, id. at 27-28; (3) Lendian tried to destroy relevant Metals USA records, id. at 37; (4)
Lendian asked Abreu to take the blame for the thefts and testify that Lendian did not know that the
materials were stolen, id. at 47, 70; (5) Lendian offered Abreu $20,000.00 for Abreu’s legal fees
if Abreu agreed to use a lawyer of Lendian’s choosing, id. at 55, 72-74; and (6) Lendian instructed
Abreu to purchase a new cell phone under a false name, ECF No. [264-9] at 2-3.
On the other hand, Defendants contend that the recordings support the existence of issues
of fact and present a narrative consistent with their assertions that Defendants neither knew of the
thefts, nor directed or participated in them. Defendants also emphasize that these recordings were
taken as a result of Abreu’s cooperation with, and likely coaching by, the federal officials in an
Because Defendants do not dispute, or even address, the following facts in Plaintiffs’ SOF concerning the
recordings, the Court considers such facts to be admitted. See S.D. Fla. L.R. 56.1(c) (“All material facts in
any party’s Statement of Material Facts may be deemed admitted unless controverted by the other party’s
Statement of Material Facts, provided that: (i) the Court finds that the material fact at issue is supported by
properly cited record evidence; and (ii) any exception under Fed. R. Civ. P. 56 does not apply.”).
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effort to bait Lendian into making incriminating statements. Defendants dispute the version of
facts that Plaintiffs derive from these recordings and allege the following facts instead: (1) Lendian
produced his bank records and those records contain no proof that Lendian transferred his assets
out of the United States, Lendian Aff. at 29, ¶ 75; (2) The transcript cited by Plaintiffs demonstrates
that, contrary to what they allege, it was Abreu who suggested lying to his own attorney, not
Lendian, ECF No. [264-8] at 11; (3) The record indicates that it was Abreu who sought to destroy
Metals USA records, Rodriguez Dep. 65:1-67:23, and the recording transcript cited shows that
Lendian told Abreu that he could not destroy the records in order to avoid a confrontation with
someone who Lendian believed could exonerate him, ECF No. [264-8] at 46-47; (4) Lendian spoke
with Abreu in an effort to clear his name and the transcript contradicts Plaintiffs’ allegations that
Lendian asked Abreu to take the blame for the thefts, instead establishing that Abreu suggested
that he “bear the guilt for everything,” id. at 46-47; (5) Lendian offered to help Abreu with his
legal fees, but the offer was not conditioned upon a lawyer of Lendian’s choosing, and the
recording transcript contains no support for this alleged conditional offer, id. at 55, 72-74; and (6)
There is no indication in the recording transcript cited that Lendian instructed Abreu to purchase
a new cell phone under a false name, ECF No. [264-9] at 2-3. Defendants also note that the
recordings support the following facts: (1) Neither Lendian nor Abreu indicated that Lendian
“orchestrated” the theft scheme, see generally ECF Nos. [264-8] & [264-9]; (2) Neither Lendian
nor Abreu indicated that Lendian was a “ringleader,” see generally id.; (3) Neither Lendian nor
Abreu indicated that Lendian directed Abreu to steal from Plaintiffs, see generally id.; (4) Neither
Lendian nor Abreu indicated that Lendian knew the material purchased from Abreu was stolen,
see generally id.; (5) Neither Lendian nor Abreu suggested that Lendian was responsible for
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Abreu’s thefts, see generally id.; (6) Lendian did not know any of the alleged participants in the
theft scheme, id. at 65; and (7) Lendian did not know that the materials were stolen, id. at 70.
III. LEGAL STANDARD
The standard of review on cross-motions for summary judgment does not differ from the
standard applied when only one party files such a motion. See Am. Bankers Ins. Grp. v. United
States, 408 F.3d 1328, 1331 (11th Cir. 2005). A court may grant a motion for summary judgment
“if the movant shows that there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The parties may support their
positions by citations to materials in the record, including, among other things, depositions,
documents, affidavits, or declarations. See Fed. R. Civ. P. 56(c). An issue is genuine if “a
reasonable trier of fact could return judgment for the non-moving party.” Miccosukee Tribe of
Indians of Fla. v. United States, 516 F.3d 1235, 1243 (11th Cir. 2008) (quoting Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 247-48 (1986)). A fact is material if it “might affect the outcome of the
suit under the governing law.” Id. (quoting Anderson, 477 U.S. at 247-48).
A court views the facts in the light most favorable to the non-moving party, draws “all
reasonable inferences in favor of the nonmovant and may not weigh evidence or make credibility
determinations, which ‘are jury functions, not those of a judge.’” Lewis v. City of Union City, Ga.,
934 F.3d 1169, 1179 (11th Cir. 2019) (quoting Feliciano v. City of Miami Beach, 707 F.3d 1244,
1252 (11th Cir. 2013)); Davis v. Williams, 451 F.3d 759, 763 (11th Cir. 2006); see also Crocker
v. Beatty, 886 F.3d 1132, 1134 (11th Cir. 2018) (“[W]e accept [the non-movant’s] version of the
facts as true and draw all reasonable inferences in the light most favorable to him as the nonmovant.”). “The mere existence of a scintilla of evidence in support of the [non-moving party’s]
position will be insufficient; there must be evidence on which a jury could reasonably find for the
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[non-moving party].” Anderson, 477 U.S. at 252. “If more than one inference could be construed
from the facts by a reasonable fact finder, and that inference introduces a genuine issue of material
fact, then the district court should not grant summary judgment.” Bannum, Inc. v. City of Fort
Lauderdale, 901 F.2d 989, 996 (11th Cir. 1990). The Court does not weigh conflicting evidence.
See Skop v. City of Atlanta, Ga., 485 F.3d 1130, 1140 (11th Cir. 2007) (quoting Carlin Comm’n,
Inc. v. S. Bell Tel. & Tel. Co., 802 F.2d 1352, 1356 (11th Cir. 1986)).
The moving party shoulders the initial burden to demonstrate the absence of a genuine
issue of material fact. Shiver v. Chertoff, 549 F.3d 1342, 1343 (11th Cir. 2008). If a movant satisfies
this burden, “the nonmoving party ‘must do more than simply show that there is some metaphysical
doubt as to the material facts.’” Ray v. Equifax Info. Servs., LLC, 327 F. App’x 819, 825 (11th Cir.
2009) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)).
Instead, “the non-moving party ‘must make a sufficient showing on each essential element of the
case for which he has the burden of proof.’” Id. (quoting Celotex Corp. v. Catrett, 477 U.S. 317,
322 (1986)). The non-moving party must produce evidence, going beyond the pleadings, and by
its own affidavits, or by depositions, answers to interrogatories, and admissions on file, designating
specific facts to suggest that a reasonable jury could find in the non-moving party’s favor. Shiver,
549 F.3d at 1343. Yet, even where a non-movant neglects to submit any alleged material facts in
dispute, a court must still be satisfied that the evidence in the record supports the uncontroverted
material facts proposed by the movant before granting summary judgment. Reese v. Herbert, 527
F.3d 1253, 1268-69, 1272 (11th Cir. 2008); United States v. One Piece of Real Prop. Located at
5800 S.W. 74th Ave., Miami, Fla., 363 F.3d 1099, 1103 n.6 (11th Cir. 2004) (“One Piece of Real
Prop.”). Indeed, even “where the parties agree on the basic facts, but disagree about the factual
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inferences that should be drawn from those facts,” summary judgment may be inappropriate.
Warrior Tombigbee Transp. Co., Inc. v. M/V Nan Fung, 695 F.2d 1294, 1296 (11th Cir. 1983).
Additionally, “cross motions for summary judgment may be probative of the nonexistence
of a factual dispute, but this procedural posture does not automatically empower the court to
dispense with the determination whether questions of material fact exist.” Ga. State Conference of
NAACP v. Fayette Cty. Bd. of Comm’rs, 775 F.3d 1336, 1345-46 (11th Cir. 2015). Indeed, even
where the issues presented on motions for summary judgment overlap, a court must consider each
motion on its own merits, “resolving all reasonable inferences against the party whose motion is
under consideration.” S. Pilot Ins. Co. v. CECS, Inc., 52 F. Supp. 3d 1240, 1243 (N.D. Ga. 2014)
(citing Am. Bankers Ins. Grp., 408 F.3d at 1331). In particular, where “the parties respond[] to
each respective summary judgment motion with disputes as to the ‘undisputed’ facts, add[]
‘material facts’ of their own, and then repl[y] with subsequent objections to the other party’s
additional facts,” the mere filing of cross motions for summary judgment is not conclusive. Id.
Thus, where the parties disagree as to the facts, summary judgment cannot be entered unless one
of the parties meets its burden of demonstrating that “there is no dispute as to any material facts
with the evidence and all inferences drawn therefrom viewed in the light most favorable” to the
non-moving party. Shook v. United States, 713 F.2d 662, 665 (11th Cir. 1983) (citing M/V Nan
Fung, 695 F.2d at 1296-97).
IV. DISCUSSION
Plaintiffs’ Motion for Summary Judgment argues that no genuine issue of material fact
exists as to any of the elements of their federal and Florida RICO claims in Counts I, II, III, and
IV of their Amended Complaint. Plaintiffs’ arguments rely in part on adverse inferences derived
from Lendian’s prior invocation of his Fifth Amendment rights during his deposition, which they
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contend the Court should consider instead of Lendian’s subsequent affidavit submitted at summary
judgment. Defendants, on the other hand, move for summary judgment on all counts of Plaintiffs’
Amended Complaint, arguing that Plaintiffs cannot establish the enterprise and continuity
elements of their RICO claims and that they cannot establish a benefit conferred by Plaintiffs on
their unjust enrichment claim. Defendants’ Motion for Summary Judgment relies heavily on the
statements set forth in Lendian’s affidavit, which they contend the Court may properly consider as
a valid withdrawal of a prior Fifth Amendment invocation. Thus, before examining the merits of
the Motions, the Court must first address the propriety of the withdrawal of Lendian’s Fifth
Amendment invocation and his subsequent summary judgment affidavit.
A. Withdrawal of Lendian’s Fifth Amendment Invocation and Supplemental Affidavit
Plaintiffs argue that the Court should draw adverse inferences against Defendants and that
Lendian’s affidavit should be disregarded for two reasons: (1) Lendian invoked the Fifth
Amendment during his testimony at the preliminary injunction hearing and at his deposition and
he should not now be allowed to submit an affidavit at summary judgment asserting facts he
previously refused to provide, and (2) Lendian’s statements in his affidavit are stale, self-serving,
conclusory, and have no probative value as competent summary judgment evidence. Defendants
argue against drawing adverse inferences, stating that Lendian’s affidavit is permissible here
because a party may properly withdraw a Fifth Amendment invocation in certain circumstances.
1. Fifth Amendment Invocation and Withdrawal
The United States Supreme Court has explained that the Fifth Amendment protects an
individual from self-incrimination, in part, by affording the privilege “not to answer official
questions put to him in any [] proceeding, civil or criminal, formal or informal, where the answers
might incriminate him in future criminal proceedings.” Baxter v. Palmigiano, 425 U.S. 308, 316
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(1976) (quoting Lefkowitz v. Turley, 414 U.S. 70, 77 (1973)); see also Davis-Lynch, Inc. v.
Moreno, 667 F.3d 539, 547 (5th Cir. 2012) (“As a preliminary matter, it should be noted that a
party may invoke the privilege against self-incrimination in a civil proceeding.” (footnote
omitted)); Wehling v. Columbia Broad. Sys., 608 F.2d 1084, 1086 (5th Cir. 1979)8 (“[I]t is clear
that the Fifth Amendment would serve as a shield to any party who feared that complying with
discovery would expose him to a risk of self-incrimination. The fact that the privilege is raised in
a civil proceeding rather than a criminal prosecution does not deprive a party of its protection.”).
“Accordingly, a party may invoke the Fifth Amendment privilege during the discovery process to
avoid answering questions at a deposition, responding to interrogatories or requests for admissions,
or to produce documents.” Davis-Lynch, Inc., 667 F.3d at 547 (footnote omitted).
“Though constitutionally protected, a civil litigant’s invocation of the privilege against
self-incrimination during the discovery process is far from costless.” United States v. Certain Real
Prop. & Premises Known as 4003-4005 5th Ave., Brooklyn, N.Y., 55 F.3d 78, 82 (2d Cir. 1995)
(“Certain Real Prop.”). “[D]istrict courts possess wide discretion in response to a party’s
invocation of the Fifth Amendment.” Sec. & Exch. Comm’n v. Monterosso, 746 F. Supp. 2d 1253,
1262 (S.D. Fla. 2010) (citing Sec. & Exch. Comm’n v. Colello, 139 F.3d 674, 677 (9th Cir. 1998);
Wehling, 608 F.2d at 1089). Further, the Eleventh Circuit has stated that, in a civil action, “the
court may draw adverse inferences against a party that invokes the Fifth Amendment.” Eagle
Hosp. Physicians, LLC v. SRG Consulting, Inc., 561 F.3d 1298, 1304 (11th Cir. 2009); Arango v.
U.S. Dep’t of the Treasury, 115 F.3d 922, 926 (11th Cir. 1997) (“[T]he Fifth Amendment does not
forbid adverse inferences against civil litigants . . . who assert the privilege against self-
8
The Court of Appeals for the Eleventh Circuit, in Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th
Cir. 1981), adopted all decisions of the Court of Appeals for the Fifth Circuit that were rendered prior to
October 1, 1981.
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incrimination. A party who asserts the privilege may not ‘convert [it] from the shield against
compulsory self-incrimination which it was intended to be into a sword whereby [he] would be
freed from adducing proof in support of a burden which would otherwise have been his.’” (citations
omitted)). Accordingly, “a ‘party who asserts the privilege against self-incrimination must bear
the consequence of lack of evidence,’ and the claim of privilege will not prevent an adverse finding
or even summary judgment if the litigant does not present sufficient evidence to satisfy the usual
evidentiary burdens in the litigation.” Certain Real Prop., 55 F.3d at 83 (citations omitted).
Nevertheless, the Supreme Court has also emphasized that the Constitution limits “the
imposition of any sanction which makes assertion of the Fifth Amendment privilege ‘costly.’”
Spevack v. Klein, 385 U.S. 511, 515 (1967). Moreover, under certain case-specific circumstances,
a party may withdraw its invocation of the Fifth Amendment privilege against self-incrimination
in a civil case. See Davis-Lynch, Inc., 667 F.3d at 547 (“Courts have weighed the specific facts of
each case in which a civil litigant has attempted to withdraw his invocation of the Fifth Amendment
privilege.”); Sec. & Exch. Comm’n v. BIH Corp., No. 2:10-CV-577-FTM-29, 2013 WL 6571472,
at *2 (M.D. Fla. Dec. 13, 2013) (“Withdrawal ‘is dependent on the particular facts and
circumstances of each case.’” (quoting Sec. & Exch. Comm’n v. Smart, 678 F.3d 850, 855 (10th
Cir. 2012))). “Given this consideration — and because all parties should have a reasonable
opportunity to litigate a civil case fully — courts should seek out ways to permit ‘as much
testimony as possible to be presented in the civil litigation, despite the assertion of the privilege.’”
Davis-Lynch, Inc., 667 F.3d at 547 (quoting Certain Real Prop., 55 F.3d at 84). As such, courts
must “carefully balance the interests of the party claiming protection against self-incrimination
and the adversary’s entitlement to equitable treatment. Because the privilege is constitutionally
based, the detriment to the party asserting it should be no more than is necessary to prevent unfair
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and unnecessary prejudice to the other side.” Monterosso, 746 F. Supp. 2d at 1262 (citations
omitted); Wehling, 608 F.2d at 1088.
Generally, “[t]he court should be especially inclined to permit withdrawal
of the privilege if there are no grounds for believing that opposing parties suffered
undue prejudice from the litigant’s later-regretted decision to invoke the Fifth
Amendment.” Conversely, withdrawal is not permitted if the litigant is trying to
“abuse, manipulate or gain an unfair strategic advantage over opposing parties.”
The timing and circumstances under which a litigant withdraws the privilege are
relevant factors in considering whether a litigant is attempting to abuse or gain some
unfair advantage.
Davis-Lynch, Inc., 667 F.3d at 547 (footnotes omitted). Thus, “a party may withdraw its assertion
of the Fifth Amendment privilege, even at a late stage in litigation, if circumstances indicate that
(1) the litigant was not using the privilege in a tactical, abusive manner, and (2) the opposing party
would not experience undue prejudice as a result.” Id. at 548 (citing Sec. & Exch. Comm’n v.
Graystone Nash, Inc., 25 F.3d 187, 193 (3d Cir. 1994)).
“In the end, exactly how a trial court should respond to a request to withdraw the privilege
— or indeed, more generally, how it should react to any motion precipitated by a litigant’s assertion
of the Fifth Amendment in a civil proceeding — necessarily depends on the precise facts and
circumstances of each case.” Certain Real Prop., 55 F.3d at 85. In making this determination,
however, courts must be cautious not to, “through inappropriate procedural remedies or
unwarranted sanctions, unduly burden litigants’ valid attempts to seek the protection that the
privilege against self-incrimination provides.” Id. “Therefore, a party may withdraw its invocation
of the Fifth Amendment privilege, even at a late stage in the process, when circumstances indicate
that there is no intent to abuse the process or gain an unfair advantage, and there is no unnecessary
prejudice to the other side.” Davis-Lynch, Inc., 667 F.3d at 548; Smart, 678 F.3d at 854-55 (“But
‘to prevent a party from converting the Fifth Amendment privilege from its intended use as a shield
against compulsory self-incrimination into an offensive sword,’ ‘a district court may strike
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conclusory testimony if the witness asserts the Fifth Amendment privilege to avoid answering
relevant questions, yet freely responds to questions that are advantageous to his cause.’” (citing
United States v. $148,840 in U.S. Currency, 521 F.3d 1268, 1277 (10th Cir. 2008))).
Plaintiffs first argue that the Court should draw adverse inferences against Defendants
based on Lendian’s prior, repeated Fifth Amendment invocations. Thus, Plaintiffs contend that the
Court should disregard Lendian’s affidavit because permitting Lendian to submit an affidavit on
issues that were previously said to be privileged in order to defeat summary judgment would be
prejudicial to Plaintiffs. Defendants argue that Lendian’s affidavit is a valid and permissible
withdrawal of his prior Fifth Amendment invocation after learning that the DOJ was declining
prosecution and closing the pending criminal investigation. Likewise, Defendants state that
Lendian is available for a deposition, should Plaintiffs wish to take it instead of continuing to reply
on stale adverse inferences.
Although many Circuits across the country have addressed the withdrawal of a prior Fifth
Amendment invocation, the Eleventh Circuit has not specifically addressed the issue. See, e.g.,
Davis-Lynch, Inc., 667 F.3d at 546 n.10 (collecting cases); Graystone Nash, Inc., 25 F.3d at 19092 (collecting cases). However, “district courts possess wide discretion in response to a party’s
invocation of the Fifth Amendment.” Monterosso, 746 F. Supp. 2d at 1262. Moreover, the Fifth
Circuit has previously recognized the balance-of-interests approach in responding to parties’ Fifth
Amendment invocations, explaining that courts should “measure[] the relative weights of the
parties’ competing interests with a view toward accommodating those interests, if possible . . . [to]
ensure[] that the rights of both parties are taken into consideration before the court decides whose
rights predominate.” Wehling, 608 F.2d at 1088; Graystone Nash, Inc., 25 F.3d at 191 (“In a civil
trial, a party’s invocation of the privilege may be proper, but it does not take place in a vacuum;
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the rights of the other litigant are entitled to consideration as well.”). More recently, in DavisLynch, Inc., the Fifth Circuit synthesized the analysis from other Circuits “on whether and under
what circumstances a party may withdraw its invocation of the Fifth Amendment privilege against
self incrimination in a civil case.” 667 F.3d at 546.
Generally, ‘[t]he court should be especially inclined to permit withdrawal
of the privilege if there are no grounds for believing that opposing parties suffered
undue prejudice from the litigant’s later-regretted decision to invoke the Fifth
Amendment.’ Conversely, withdrawal is not permitted if the litigant is trying to
‘abuse, manipulate or gain an unfair strategic advantage over opposing parties.’ The
timing and circumstances under which a litigant withdraws the privilege are
relevant factors in considering whether a litigant is attempting to abuse or gain some
unfair advantage.
For example, some Circuits have not allowed a litigant to withdraw the
privilege when he invoked the privilege throughout discovery and then sought to
withdraw the privilege either to support or defend against a motion for summary
judgment . . . .
On the other hand, a party may withdraw its assertion of the Fifth
Amendment privilege, even at a late stage in litigation, if circumstances indicate
that (1) the litigant was not using the privilege in a tactical, abusive manner, and
(2) the opposing party would not experience undue prejudice as a result . . . .
. . . Therefore, a party may withdraw its invocation of the Fifth Amendment
privilege, even at a late stage in the process, when circumstances indicate that there
is no intent to abuse the process or gain an unfair advantage, and there is no
unnecessary prejudice to the other side.
Id. at 547-48 (footnotes omitted); see also BIH Corp., 2013 WL 6571472, at *2 (applying DavisLynch, Inc.’s analysis).
Accordingly, courts have granted adverse inferences against parties who invoke their Fifth
Amendment privileges and later withdraw these privileges in an attempt to game the system.
Monterosso, 746 F. Supp. 2d at 1262-64. Similarly, courts have stricken parties’ subsequent
testimony after the withdrawal of a prior Fifth Amendment invocation. In re Edmond, 934 F.2d
1304, 1308-09 (4th Cir. 1991); United States v. Parcels of Land, 903 F.2d 36, 43 (1st Cir. 1990);
BIH Corp., 2013 WL 6571472, at *2-3. Furthermore, courts have permitted parties to withdraw a
Fifth Amendment invocation, where the invocation was not done to gain an unfair advantage and
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there was no undue prejudice to the opposing party. Davis-Lynch, Inc., 667 F.3d at 548-49;
Graystone Nash, Inc., 25 F.3d at 193-94. “In the end, exactly how a trial court should respond to
a request to withdraw the privilege — or indeed, more generally, how it should react to any motion
precipitated by a litigant’s assertion of the Fifth Amendment in a civil proceeding — necessarily
depends on the precise facts and circumstances of each case.” Certain Real Prop., 55 F.3d at 85;
Graystone Nash, Inc., 25 F.3d at 192 (“This brief survey of case law makes it apparent that the
effects that an invocation of the privilege against self-incrimination will have in a civil suit depends
to a large extent on the circumstances of the particular litigation.”).
Here, Defendants learned of the DOJ’s criminal investigation in August 2018. ECF No.
[122] at 1. On September 7, 2018, Lendian testified at a hearing on Plaintiffs’ Motion for
Preliminary Injunction, where he, for the first time, asserted his Fifth Amendment rights. ECF No.
[264-2] at 186-201. On December 1, 2018, Lendian was deposed in his individual capacity, and
again invoked the protections of the Fifth Amendment. ECF No. [264-6]. On February 15, 2019,
Plaintiffs filed their initial Motion for Partial Summary Judgment as to Liability. ECF No. [120].
On March 1, 2019, Defendants filed a Motion for Temporary Stay pending the potential criminal
prosecution, ECF No. [122], which the Court granted on April 4, 2019, ECF No. [146]. On August
26, 2019, Defendants were informed that the DOJ did not intend to prosecute them and that it had
closed its criminal investigation into Defendants. ECF No. [151] at 1. On August 28, 2019, this
Court lifted the stay. ECF No. [154]. In lifting the stay, this Court set the deadline to complete all
discovery for September 27, 2019. ECF No. [154].
Relevant to the issue of when Lendian first withdrew his prior Fifth Amendment invocation
and submitted the affidavit in question, on August 29, 2019, Plaintiffs filed their first Renewed
Motion for Partial Summary Judgment, ECF No. [158], incorporating the Statement of Material
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Facts from their original Motion, ECF No. [119]. On September 12, 2019, Defendants filed their
Response in Opposition to Plaintiffs’ Motion for Summary Judgment, ECF No. [165], and their
Counterstatement of Material Facts, ECF No. [166]. Defendants’ Counterstatement of Material
Facts included, for the first time, Lendian’s affidavit as an exhibit. ECF No. [166-1].
Defendants state that, immediately upon learning that the criminal investigation was
closed, Lendian agreed to make himself available to be re-deposed any time before trial. ECF No.
[267] at 5 & n.1. Thus, the Court must determine whether Lendian’s withdrawal of his prior Fifth
Amendment invocation in his affidavit was warranted, or whether the Court should draw adverse
inferences from Lendian’s prior Fifth Amendment invocation.
As explained above, there are two primary inquiries that courts must address when
determining whether to permit a party to withdraw a prior invocation of the Fifth Amendment —
namely, “a party may withdraw its assertion of the Fifth Amendment privilege, even at a late stage
in litigation, if circumstances indicate that (1) the litigant was not using the privilege in a tactical,
abusive manner, and (2) the opposing party would not experience undue prejudice as a result.”
Davis-Lynch, Inc., 667 F.3d at 548 (citing Graystone Nash, Inc., 25 F.3d at 193).
The Court concludes that Lendian’s invocation and subsequent withdrawal of his Fifth
Amendment protections was not done for the purpose of abusing the judicial system. Specifically,
the unusual facts and timing of events in this case weigh heavily against Defendants’ alleged intent
to gain an unfair advantage in the case. The timeline of the proceedings during the course of this
litigation suggest that Lendian validly sought constitutional protections through his Fifth
Amendment invocation, based on the belief that Defendants were under threat of criminal
prosecution by the DOJ. See ECF No. [122]. Moreover, immediately upon learning that the
criminal investigation was closed, Defendants apparently notified Plaintiffs that Lendian would
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agree to be re-deposed at any point before trial and further withdrew the prior Fifth Amendment
invocation by submitting his affidavit in response to Plaintiffs’ Motion for Summary Judgment.
ECF No. [267] at 5 & n.1; see Davis-Lynch, Inc., 667 F.3d at 548 (“The timing and circumstances
under which a litigant withdraws the privilege are relevant factors in considering whether a litigant
is attempting to abuse or gain some unfair advantage.”); id. at 548 (discussing case permitting
parties to withdraw Fifth Amendment invocations because withdrawal was done around the time
the criminal prosecution was wrapping up (citing Evans v. City of Chicago, 513 F.3d 735, 746 (7th
Cir. 2008))); In re Edmond, 934 F.2d at 1308-09 (holding that selective assertion of Fifth
Amendment privilege to thwart opposing party’s ability to take deposition testimony then use of
that testimony to defeat summary judgment was improper); Monterosso, 746 F. Supp. 2d at 1262
(“Courts should ‘give due consideration to the nature of the proceeding, how and when the
privilege was invoked, and the potential for harm or prejudice to opposing parties.’” (citation
omitted)). Lendian’s willingness to sit for a supplemental deposition indicates that Defendants’
did not invoke the Fifth Amendment to abuse the litigation process. These facts strongly contradict
any suspected intent of Defendants to manipulate these proceedings to gain an unfair advantage.
Moreover, regarding any prejudice to Plaintiffs, the Court notes that this prejudice is likely
outweighed by the fact that (1) Defendants informed Plaintiffs that Lendian was willing to be redeposed, upon learning that the criminal investigation was closed, which came weeks before the
discovery deadline, and (2) permitting Lendian’s affidavit allows the parties to present as much
testimony as possible in the instant litigation. See Davis-Lynch, Inc., 667 F.3d at 549; Certain Real
Prop., 55 F.3d at 84. Although “opposing parties will frequently suffer prejudice (at the very least
from increased costs and delays) when a litigant relies on the Fifth Amendment during discovery
and then decides to waive the privilege much later in the proceeding,” Certain Real Prop., 55 F.3d
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at 86, this prejudice must nonetheless be weighed against the interests of the party claiming the
protection, Graystone Nash, Inc., 25 F.3d at 192. Furthermore, the withdrawal of a prior Fifth
Amendment invocation alone, even at a late stage in the proceedings, is insufficient to establish
undue prejudice, especially where, as here, the opposing party still had an opportunity to
investigate during the discovery period. See id. at 191-92 (collecting cases); Davis-Lynch, Inc.,
667 F.3d at 548-49; Evans, 513 F.3d at 746; BIH Corp., 2013 WL 6571472, at *2-3.
The Court therefore concludes that, as it concerns Lendian’s withdrawal of his Fifth
Amendment invocation and Plaintiffs’ potential prejudice, the balance of the parties’ interests
weighs in favor of permitting Lendian to withdraw his prior Fifth Amendment invocation and
submit his affidavit on the merits. Accordingly, the Court concludes that Lendian’s withdrawal of
his previous Fifth Amendment invocation is permissible here. See Monterosso, 746 F. Supp. 2d at
1262 (“[D]istrict courts possess wide discretion in response to a party’s invocation of the Fifth
Amendment.”); Certain Real Prop., 55 F.3d at 85 n.7 (“A trial court’s authority [to respond to
parties’ Fifth Amendment invocations] stems from its broad discretion to control and to fashion
remedies for abuses of the discovery process.”); Graystone Nash, Inc., 25 F.3d at 194 (“The
imposition of an appropriate remedy [for the withdrawal of a party’s Fifth Amendment privilege]
is within the discretion of the trial court.”).
2. Sufficiency of Rule 56 Affidavits
With regard to motions for summary judgment, under Federal Rule of Civil Procedure 56,
a party alleging the absence or presence of a genuine dispute as to a particular fact must support
their allegation by “citing to particular parts of materials in the record, including depositions,
documents, electronically stored information, affidavits or declarations, stipulations (including
those made for purposes of the motion only), admissions, interrogatory answers, or other
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materials.” Fed. R. Civ. P. 56(c)(1)(A). Moreover, “[a]n affidavit or declaration used to support or
oppose a motion must be made on personal knowledge, set out facts that would be admissible in
evidence, and show that the affiant or declarant is competent to testify on the matters stated.” Fed.
R. Civ. P. 56(c)(4). Under Rule 56, affidavits based on conclusory allegations, rather than
statements of fact based on personal knowledge, are improper. Fed. R. Civ. P. 56(e). Thus, when
a party submits “[s]worn statements which fail to meet the standards set forth in Rule 56(e),” a
court “may strike or disregard the improper portions and consider the remainder of the testimony
or statement.” Dortch v. City of Montgomery, No. 07-cv-1034-MEF, 2009 WL 959638, at *1
(M.D. Ala. Apr. 8, 2009) (citing Thomas v. Ala. Council on Human Relations, Inc., 248 F. Supp.
2d 1105, 1112 (M.D. Ala. 2003)).
“Once the moving party makes the required [summary judgment] showing, the burden
shifts to the non-moving party to rebut that showing by producing affidavits or other relevant and
admissible evidence beyond the pleadings.” Josendis v. Wall to Wall Residence Repairs, Inc., 662
F.3d 1292, 1315 (11th Cir. 2011). “[O]ne who resists summary judgment must meet the movant’s
affidavits with opposing affidavits setting forth specific facts to show why there is an issue for
trial.” Leigh v. Warner Bros., Inc., 212 F.3d 1210, 1217 (11th Cir. 2000) (quoting Gossett v. DuRa-Kel Corp., 569 F.2d 869, 872 (5th Cir. 1978)). “All affidavits must be based on personal
knowledge and must set forth facts that would be admissible under the Federal Rules of Evidence.”
Josendis, 662 F.3d at 1315; Ellis v. England, 432 F.3d 1321, 1326 (11th Cir. 2005) (“[M]ere
conclusions and unsupported factual allegations are legally insufficient to defeat a summary
judgment motion. Moreover, statements in affidavits that are based, in part, upon information and
belief, cannot raise genuine issues of fact, and thus also cannot defeat a motion for summary
judgment.” (citations omitted)); Walace v. Cousins, No. 18-10267, 2019 WL 3819299, at *3 (11th
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Cir. Aug. 15, 2019) (“[A]n affidavit that fails to support its assertions ‘with[] specific supporting
facts [has] no probative value.’” (quoting Leigh, 212 F.3d at 1217)).
“An affidavit cannot be conclusory, but nothing in Rule 56 (or, for that matter, in the
Federal Rules of Civil Procedure) prohibits an affidavit from being self-serving.
Indeed[,] . . . ‘most affidavits submitted [in response to a summary judgment motion] are selfserving.’” United States v. Stein, 881 F.3d 853, 857 (11th Cir. 2018) (citations omitted); see id. (“a
litigant’s self-serving statements based on personal knowledge or observation can defeat summary
judgment”). “Nor does Rule 56 require that an otherwise admissible affidavit be corroborated by
independent evidence.” Id. at 858. As such, “[a] non-conclusory affidavit which complies with
Rule 56 can create a genuine dispute concerning an issue of material fact, even if it is self-serving
and/or uncorroborated.” Id. at 858-59.
In their Reply, Plaintiffs argue that Lendian’s affidavit should be disregarded because it is
based on self-serving, conclusory statements, which are improper evidence on a motion for
summary judgment and which nevertheless do not create any genuine issues of material fact. ECF
No. [275] at 5-7. Likewise, Plaintiffs argue that the affidavit is untimely and prejudicial, given
Lendian’s prior Fifth Amendment invocation, and that it is predicated on stale and unintelligible
statements responding to Plaintiffs’ prior Statement of Material Facts, ECF No. [119], that have
no probative value. ECF No. [275] at 7-8.
“The rule is settled that on a motion for summary judgment a court will disregard only the
inadmissible portions of a challenged affidavit offered in support of or opposition to the motion
and will consider the admissible portions in determining whether to grant or deny the motion.” Lee
v. Nat’l Life Assurance Co. of Can., 632 F.2d 524, 529 (5th Cir. 1980); see also Givhan v. Elec.
Eng’rs, Inc., 4 F. Supp. 2d 1331, 1334 n.2 (M.D. Ala. 1998) (“The court may strike or disregard
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the inadmissible portions and consider the rest of the affidavit.” (citing S. Concrete Co. v. U.S.
Steel Corp., 394 F. Supp. 362, 380 (N.D. Ga. 1975))). As discussed at length above, the Court
determined that Lendian’s withdrawal of his prior Fifth Amendment invocation was permissible.
Thus, even if Plaintiffs are correct in arguing that some of the allegations in Lendian’s affidavit
are conclusory, stale, or improper, the Court is “capable of sifting evidence, as required by the
summary-judgment standard.” Reeves-Howard v. S. Union State Cmty. Coll., No. 07-cv-967MHT, 2009 WL 1442059, at *1 (M.D. Ala. May 20, 2009). As such, to the extent that it is
necessary, the Court will “disregard [any] improper portions [of Lendian’s affidavit] and consider
the remainder of the testimony or statement.” Dortch, 2009 WL 959638, at *1.
B. Plaintiffs’ Renewed Motion for Partial Summary Judgment as to Liability
Plaintiffs move for summary judgment on their federal and Florida RICO claims in Counts
I, II, III, and IV of their Amended Complaint. Specifically, Plaintiffs argue that there are no
genuine issues of material fact on any of the five elements of their general RICO claims under
either federal or Florida law. Neither, Plaintiffs contend, are there any genuine issues of fact as to
the elements required to establish their federal and Florida RICO conspiracy claims. In opposition,
Defendants argue that genuine issues of material fact exist as to their statute of limitations
affirmative defense. Moreover, Defendants assert that Plaintiffs have failed to sufficiently establish
the enterprise and continuity elements of their RICO claims under Counts I through IV. In reply,
Plaintiffs allege that no genuine issues of material fact exist as to Defendants’ statute of limitations
affirmative defense because additional predicate acts restart the statute of limitations.
As explained in detail above, the Court concludes that Lendian’s withdrawal of his Fifth
Amendment invocation was valid under the circumstances of this case. To the extent that certain
allegations in Lendian’s affidavit are improper, stale, or conclusory, the Court will disregard these
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allegations as needed. Further, “the mere existence of some alleged factual dispute between the
parties will not defeat an otherwise properly supported motion for summary judgment; the
requirement is that there be no genuine issue of material fact.” Anderson, 477 U.S. at 247-48.
Nevertheless, if, in the Court’s consideration of the translated recordings, the “opposing parties
tell two different stories, one of which is blatantly contradicted by the record, so that no reasonable
jury could believe it, [the] [C]ourt should not adopt that version of the facts for purposes of ruling
on a motion for summary judgment.” Scott v. Harris, 550 U.S. 372, 380 (2007) (emphasis added).9
“If the record does not blatantly contradict the nonmovant’s version of events, the court must
determine ‘whether a fair-minded jury could return a verdict for the plaintiff on the evidence
presented.’” Witter v. Bank of Am., No. 1:07-CV-1344-GET-AJB, 2008 WL 11470984, at *5 (N.D.
Ga. May 15, 2008) (quoting Anderson, 477 U.S. at 252), report and recommendation adopted,
2008 WL 11470997, at *1 (N.D. Ga. June 12, 2008); EPL Inc. v. USA Fed. Credit Union, 173 F.3d
1356, 1362 (11th Cir. 1999).
1. Federal and Florida Civil RICO Claims (Counts I and III)
RICO makes it “unlawful for any person employed by or associated with any enterprise
engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or
participate, directly or indirectly, in the conduct of such enterprise’s affairs through a pattern of
racketeering activity.” 18 U.S.C. § 1962(c). “Racketeering activity,” under § 1961(1)(B), includes
9
Here, there appears to be no dispute between the parties that the transcripts are true and accurate
translations of the recordings. “Generally, documents must be properly authenticated in order for them to
be considered on summary judgment. However, it makes sense that unauthenticated documents may be
considered when no objection is made or when it is apparent that those documents can be reduced to
admissible, authenticated form at trial.” Bozeman v. Orum, 199 F. Supp. 2d 1216, 1222 (M.D. Ala. 2002).
Because the authenticity of these recordings is not in dispute in this case, the Court will consider them. See
U.S. Aviation Underwriters, Inc. v. Yellow Freight Sys., Inc., 296 F. Supp. 2d 1322, 1327 n.2 (S.D. Ala.
2003) (“[A]s such, it is apparent that this document can be reduced to admissible, authenticated form at
trial, and the Court will consider it on that basis.”).
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“any act which is indictable under [18 U.S.C. § 2314] (relating to interstate transportation of stolen
property).” Id. § 1961(1)(B).10
To assert a RICO11 claim, a plaintiff “must establish that a defendant (1) operated or
managed (2) an enterprise (3) through a pattern (4) of racketeering activity that included at least
two racketeering acts.” Ray v. Spirit Airlines, Inc., 767 F.3d 1220, 1224 (11th Cir. 2014) (“Ray
I”). “A civil plaintiff must also show ‘(1) the requisite injury to “business or property,” and (2)
that such injury was “by reason of” the substantive RICO violation.’” Ray v. Spirit Airlines, Inc.,
836 F.3d 1340, 1348 (11th Cir. 2016) (“Ray II”) (quoting Williams v. Mohawk Indus., Inc., 465
F.3d 1277, 1282-83 (11th Cir. 2006), abrogated on other grounds as recognized in Simpson v.
Sanderson Farms, Inc., 744 F.3d 702, 714-15 (11th Cir. 2014)). Because the Court concludes that
the enterprise element is dispositive here, it will address that element first.
Section 1961(4) broadly defines “enterprise” to include “any individual, partnership,
corporation, association, or other legal entity, and any union or group of individuals associated in
fact although not a legal entity.” 18 U.S.C. § 1961(4). “[A] RICO enterprise need not possess an
‘ascertainable structure’ distinct from the associations necessary to conduct the pattern of
Section 2314 makes it unlawful to “transport[], transmit[], or transfer[] in interstate or foreign commerce
any goods, wares, merchandise, securities or money, of the value of $5,000 or more, knowing the same to
have been stolen, converted or taken by fraud.” 18 U.S.C. § 2314. Further, under Florida law,
“‘[r]acketeering activity’ means to commit, to attempt to commit, to conspire to commit, or to solicit,
coerce, or intimidate another person to commit: . . . . [a]ny conduct defined as ‘racketeering activity’ under
18 U.S.C. § 1961(1).” Fla. Stat. § 895.02(8).
10
The Eleventh Circuit has explained that “interpretation of Florida’s RICO law ‘is informed by case law
interpreting the federal RICO statute . . . on which Chapter 772 is patterned.’” Jackson v. BellSouth
Telecomms., 372 F.3d 1250, 1264 (11th Cir. 2004) (quoting Jones v. Childers, 18 F.3d 899, 910 (11th Cir.
1994)). Because “Florida courts often look to the Federal RICO decisions for guidance in interpreting and
applying the act,” the Eleventh Circuit has stated that the analysis for federal RICO claims is equally
applicable to state RICO claims. Id. at 1263-64. Any differences between the interpretation of the federal
and Florida RICO provisions shall be specifically noted. For example, Florida’s RICO law does not include
an interstate commerce component. See Fla. Stat. § 772.103 (“It is unlawful for any person: . . . . (3)
Employed by, or associated with, any enterprise to conduct or participate, directly or indirectly, in such
enterprise through a pattern of criminal activity or the collection of an unlawful debt.”).
11
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racketeering activity.” United States v. Goldin Indus., Inc., 219 F.3d 1271, 1274-75 (11th Cir.
2000). Instead, the Supreme Court has explained that the existence of an enterprise “is proved by
evidence of an ongoing organization, formal or informal, and by evidence that the various
associates function as a continuing unit.” United States v. Turkette, 452 U.S. 576, 583 (1981).
Thus, “the definitive factor in determining the existence of a RICO enterprise is the existence of
an association of individual entities, however loose or informal, that furnishes a vehicle for the
commission of two or more predicate crimes, that is, the pattern of racketeering activity requisite
to the RICO violation.” Goldin Indus., Inc., 219 F.3d at 1275.
The definition of an enterprise in the RICO statute is broadly worded to include
associations in fact. Boyle v. United States, 556 U.S. 938, 944 (2009). As such, “the Supreme Court
has ‘succinctly’ defined an association-in-fact enterprise as any ‘group of persons associated
together for a common purpose of engaging in a course of conduct.’” Al-Rayes v. Willingham, 914
F.3d 1302, 1307 (11th Cir. 2019) (citing Boyle, 556 U.S. at 944; Turkette, 452 U.S. at 583).
Although the “‘concept of an association in fact is expansive,’ the Supreme Court has nevertheless
found that an association-in-fact enterprise must have three ‘structural features’: (1) a ‘purpose,’
(2) ‘relationships among those associated with the enterprise,’ and (3) ‘longevity sufficient to
permit these associates to pursue the enterprise’s purpose.’” Almanza v. United Airlines, Inc., 851
F.3d 1060, 1067 (11th Cir. 2017) (quoting Boyle, 556 U.S. at 944); United States v. Elliot, 571
F.2d 880, 898 (5th Cir. 1978) (“In defining ‘enterprise’, Congress made clear that the statute
extended beyond conventional business organizations to reach ‘any . . . group of individuals’
whose association, however loose or informal, furnishes a vehicle for the commission of two or
more predicate crimes.”).
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“That an ‘enterprise’ must have a purpose is apparent from the meaning of the term in
ordinary usage, i.e., a ‘venture,’ ‘undertaking,’ or ‘project.’” Boyle, 556 U.S. at 946 (quoting
Webster’s Third New International Dictionary 757 (1976)). “Thus, the ‘concept of “associat[ion]”
requires both interpersonal relationships and a common interest.’” Al-Rayes, 914 F.3d at 1308
(quoting Boyle, 556 U.S. at 946). To satisfy the “common purpose” requirement for a RICO
enterprise, a plaintiff must establish “not only that there was some commonly shared purpose
among [the alleged associates], but also that they associated together for that purpose.” Lockheed
Martin Corp. v. Boeing Co., 357 F. Supp. 2d 1350, 1362 (M.D. Fla. 2005).
The Eleventh Circuit has held that a “group of persons who had committed a variety of
unrelated offenses with no agreement as to any particular crime could be convicted of a RICO
offense, because they were associated for the purpose of making money from repeated criminal
activity.” United States v. Cagnina, 697 F.2d 915, 920-21 (11th Cir. 1983). However, “[i]f [an]
association-in-fact enterprise does not have sufficient relationships among Defendants as
associates, it lacks the structure needed to be legally cognizable.” Almanza, 851 F.3d at 1067-68.
In order to prove sufficient relationships for an associated-in-fact enterprise, “the group must
function as a continuing unit,” not merely through independent, parallel conduct. Boyle, 556 U.S.
at 948 (emphasis added); Almanza, 851 F.3d at 1068.
Additionally, where a business is alleged to be involved in a RICO enterprise, there must
be evidence of some activity that goes beyond general, self-interested business activity, and this
requirement also applies in cases where “the individuals making up the enterprise acted
fraudulently in pursuing their own business interests.” Cisneros v. Petland, Inc., 341 F. Supp. 3d
1365, 1373-74 (N.D. Ga. 2018) (citing Parm v. Nat’l Bank of Cal. N.A., 242 F. Supp. 3d 1321,
1347 (N.D. Ga. 2017) (finding that the allegations were “more consistent with [the] Defendant
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conducting its own business initiatives” and were therefore “not sufficient to plead a RICO
enterprise”); United Food & Commercial Workers Unions & Emp’rs Midwest Health Benefits
Fund v. Walgreen Co., 719 F.3d 849, 854 (7th Cir. 2013) (noting the lack of support for the
proposition “that these communications or actions were undertaken on behalf of the enterprise as
opposed to on behalf of Walgreens and Par in their individual capacities, to advance their
individual self-interests”)); see also Parm, 242 F. Supp. 3d at 1347 (“Even if Defendant used
fraudulent means to carry out those activities, the activities constituted Defendant’s own business
affairs, not acts to further the goals of a separate enterprise.”); Singh v. NYCTL 2009-A Tr., 14 Civ.
2558, 2016 WL 3962009, at *10 (S.D.N.Y. July 10, 2016) (“the mere existence of routine business
relationships among the defendants is insufficient to establish an ‘enterprise’ under RICO”). Thus,
the question of whether a defendant’s business activities were conducted in furtherance of its own
interests or in furtherance of the goals of a separate enterprise is a question of fact.
In the instant action, Plaintiffs argue that there exists no genuine issue of material fact as
to Defendants’ association-in-fact enterprise because (1) Defendants’ enterprise existed for the
purpose of stealing Plaintiffs’ scrap metal; (2) Lendian decided and coordinated all aspects of the
thefts; and (3) the enterprise operated continuously for almost four years. Defendants Response
argues that Plaintiffs have failed to present any evidence that the association exists for a purpose
other than to commit the predicate acts, as they believe is required for a RICO enterprise.
As an initial matter, the Court notes that Defendants mischaracterize the law with regard
to establishing the enterprise element of a RICO claim. Turkette does not stand for the proposition
that, to prove the existence of a RICO enterprise, an association must always exist for a purpose
other than to commit the predicate acts, as Defendants contend. Instead, the Supreme Court in
Turkette held that the “enterprise” element of a RICO claim is separate and distinct from the
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“pattern of racketeering activity” element. 452 U.S. at 583. Specifically, the Supreme Court
explained that, to assert a RICO claim, a plaintiff “must prove both the existence of an ‘enterprise’
and the connected ‘pattern of racketeering activity.’” Id.
The enterprise is an entity, for present purposes a group of persons associated
together for a common purpose of engaging in a course of conduct. The pattern of
racketeering activity is, on the other hand, a series of criminal acts as defined by
the statute. The former is proved by evidence of an ongoing organization, formal
or informal, and by evidence that the various associates function as a continuing
unit. The latter is proved by evidence of the requisite number of acts of racketeering
committed by the participants in the enterprise. While the proof used to establish
these separate elements may in particular cases coalesce, proof of one does not
necessarily establish the other. The “enterprise” is not the “pattern of racketeering
activity”; it is an entity separate and apart from the pattern of activity in which it
engages. The existence of an enterprise at all times remains a separate element
which must be proved by the [plaintiff].
Id. (citation omitted) (footnote omitted). The Court, in Boyle, elaborated on its reasoning in
Turkette, noting that, although “the existence of an enterprise is a separate element [from the
pattern of racketeering activity] that must be proved,” Boyle, 556 U.S. at 947, and “proof of one
does not necessarily establish the other,” Turkette, 452 U.S. at 583, this does not mean “that the
existence of an enterprise may never be inferred from the evidence showing that persons associated
with the enterprise engaged in a pattern of racketeering activity,” Boyle, 556 U.S. at 947.
This interpretation of Turkette is consistent with the law in this Circuit:
[A] RICO enterprise need not possess an “ascertainable structure” distinct from the
associations necessary to conduct the pattern of racketeering activity. [United
States v. Weinstein, 762 F.2d 1522, 1537 n.13 (11th Cir. 1985)] (rejecting the
holding in United States v. Bledsoe, 674 F.2d 647, 665 (8th Cir. 1982), requiring
that the enterprise possess such a structure, distinct from the pattern of racketeering
activities).
. . . . We have held that Turkette left intact this Circuit’s holding in United
States v. Elliott, 571 F.2d 880 (5th Cir. 1978), that the definitive factor in
determining the existence of a RICO enterprise is the existence of an association of
individual entities, however loose or informal, that furnishes a vehicle for the
commission of two or more predicate crimes, that is, the pattern of racketeering
activity requisite to the RICO violation. Id. at 898. See also United States v. Hewes,
729 F.2d 1302, 1311 (11th Cir. 1984) (“a RICO enterprise exists where a group of
persons associates, formally or informally, with the purpose of conducting illegal
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activity”); United States v. Cagnina, 697 F.2d 915, 920-21 (11th Cir. 1983)
(upholding Cagnina’s RICO conviction for his participation in an “informal
criminal network engaged in racketeering activity”).
Goldin Indus., Inc., 219 F.3d at 1274-75 (footnote omitted). Thus, the Court rejects Defendants’
reading of Turkette and concludes instead that the Supreme Court’s opinion stands for the
proposition that the RICO elements of “enterprise” and “pattern of racketeering activity” are
separate elements that must each be separately proven. 452 U.S. at 583.
On the merits, however, the Court concludes that Plaintiffs’ Motion for Summary
Judgment must be denied because genuine issues of material fact still exist on the enterprise
element. Record evidence supports an alternative, legitimate narrative of facts indicating that
Defendants’ relationship with Abreu was a normal, self-interested business relationship entirely
independent of the theft ring. See Reese, 527 F.3d at 1268-69 (explaining that, on summary
judgment, the movant’s facts and the other evidentiary facts in the record must demonstrate the
absence of any genuine issue of material fact, and “the court must satisfy itself that the [movant’s]
burden has been satisfactorily discharged”). In particular, although Abreu’s testimony alleges that
Defendants devised the scheme to steal scrap metal from Plaintiffs’ facility and that Lendian was
the ringleader of the theft ring, controlling all aspects of the operation, Hr’g Tr. 100:23-101:13;
Abreu Aff. ¶¶ 11, 20, other evidentiary facts in the record contradict Defendants’ involvement in
the theft scheme. Lewis, 934 F.3d at 1179 (explaining that a court views the facts in the light most
favorable to the non-moving party, draws “all reasonable inferences in favor of the nonmovant and
may not weigh evidence or make credibility determinations, which ‘are jury functions, not those
of a judge’” (citation omitted)).
Defendants state that their interactions and transactions with Abreu were pursuant to a
legitimate business relationship. Fleites Dep. 113:2-12, 120:10-13; Metals Dep. 27:5-6; Rodriguez
Dep. 45:17-19; Lendian Aff. at 22, ¶¶ 6-7. Encarnacion was known at Plaintiffs’ facility as
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someone who “would broker loads of cars to AIM for shredding,” based on his previous business
interactions with Plaintiffs, Hr’g Tr. 90:7-9, and Defendants explain that Encarnacion was one of
Lendian’s business contacts who, around the end of 2014, approached Lendian about serving as a
broker between Metals USA and a supplier who had scrap metal to sell. Fleites Dep. 113:2-12;
Lendian Aff. at 22, ¶¶ 6-7; ECF No. [264-8] at 66-67 (Abreu: “[Ruben] was the one that introduced
us.”). Eventually, Encarnacion began working as Abreu’s broker to deliver loads of ferrous scrap
and collect payments on behalf of Abreu’s company until Abreu took over. Fleites Dep. 121:1923; Metals Dep. 27:25-28:6; Rodriguez Dep. 46:6-15; Lendian Aff. at 22, ¶¶ 10-11.
Defendants allege that Lendian never instructed Abreu to steal anything, nor did he offer
to pay Abreu $100.00 for every ton of Plaintiffs’ stolen scrap, pointing to Metals USA’s Customer
History Report, which shows the fluctuating prices Metals USA paid per ton to Abreu in
transactions from January 2015 to December 2017. Lendian Aff. at 23, ¶ 19; see generally
Customer History Report. Defendants also assert that, contrary to Abreu’s affidavit and Plaintiffs’
allegations, Lendian had no knowledge that the materials Abreu delivered were stolen and that he
never instructed Plaintiffs’ employees to steal anything, nor did he have any control over the
individuals participating in the theft scheme. Lendian Aff. at 23, ¶¶ 12-15.12
12
Statements in the recordings of the phone calls between Lendian and Abreu warrant inferences that
Defendants had no knowledge of the thefts, no direction or control over the scheme’s participants, and no
involvement in the theft ring. ECF No. [264-8] at 12 (Lendian: “I told [Ruben], ‘Listen, I’m going to pay
you with a check, if something comes up . . . I bought this legally.’”); id. at 17 (Lendian: “And I didn’t
know anything and let alone about Jose, and that’s the truth, you hear? I never met that Jose.”); id. at 46
(Lendian: “You have quite a complication there with the tickets. Because it’s a lot of money. Well, we both
have a problem. My only alibi is that I didn’t know, you know? That it was stolen.”); id. at 65 (Lendian: “I
don’t even know [the drivers].” Abreu: “And you don’t know anyone.”); id. at 69 (Lendian: “I didn’t know
Pedro was with you either . . . this just came up.”); id. at 75-76 (Lendian: “[Plaintiffs] are saying that I knew
that the material was stolen because I was buying material too cheap from you. Which is a lie because they
even bought it from me too. And they also bought it cheap. Because I had no way of exporting it, I didn’t
have the connections.”). “If more than one inference could be construed from the facts by a reasonable fact
finder, and that inference introduces a genuine issue of material fact, then the district court should not grant
summary judgment.” Bannum, Inc., 901 F.2d at 996.
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Moreover, the recording transcripts do not dispel the issues of material fact, especially
where, as here, the audio recordings of the conversations themselves would likely be subject to
differing interpretations, given the tone and context.13 Rather, these recordings introduce further
factual disputes that support the denial of Plaintiffs’ Motion for Summary Judgment. Notably, the
recordings do not contain any express and unambiguous statements by Lendian indicating that he
participated in, directed, controlled, or managed the affairs of the theft ring or its participants. See
generally ECF Nos. [264-8] & [264-9]. Nor do the recordings irrefutably establish that Defendants
knew of Abreu’s ongoing theft scheme and purchased the stolen scrap metal in furtherance of that
scheme. See generally id. Any conclusions that can be drawn from the transcripts of these
recordings should be drawn in Defendants’ favor at the summary judgment stage. Likewise, on
summary judgment, this Court cannot rely on certain witness statements to demonstrate the
absence of any issues of material fact where the record contains contradictory witness testimony.
See Lewis, 934 F.3d at 1179 (a court “may not weigh evidence or make credibility determinations”
on a motion for summary judgment). Here, Abreu and Lendian present conflicting testimony on
material facts, such as Defendants’ knowledge of and participation in the theft ring, which are
further muddled by the recording transcripts. Granting summary judgment despite the existence of
“When opposing parties tell two different stories, one of which is blatantly contradicted by the record,
so that no reasonable jury could believe it, [the] [C]ourt should not adopt that version of the facts for
purposes of ruling on a motion for summary judgment.” Scott, 550 U.S. at 380 (emphasis added).
Importantly though, the recording at issue in Scott was a video recording, which so obviously contradicted
the opposition’s version of facts that no reasonable jury could believe them. Id. at 378-80. Here, however,
the alleged “blatant contradictions” are based on inferences and implications derived from translated
transcripts of audio recordings, which present significantly greater issues of ambiguity and varying
interpretations. This is not the type of blatant, objectively contradictory evidence that was before the Court
in Scott. Cf. 550 U.S. at 378-79. “If the record does not blatantly contradict the nonmovant’s version of
events, the court must determine ‘whether a fair-minded jury could return a verdict for the plaintiff on the
evidence presented.’” Witter, 2008 WL 11470984, at *5 (quoting Anderson, 477 U.S. at 252).
13
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such conflicting testimony would require the Court to usurp the functions of a jury to weigh
evidence and make credibility determinations. See id.
Accepting Defendants’ version of the facts as true and drawing all reasonable inferences
in the light most favorable to them, the Court concludes that there are genuine disputes as to the
material facts establishing that Defendants were associated with the enterprise and acted in support
of the enterprise’s common purpose to steal Plaintiffs’ scrap metal. See Lewis, 934 F.3d at 1179;
Crocker, 886 F.3d at 1134. The record evidence supports Defendants’ assertion that, by purchasing
Abreu’s scrap metal pursuant to their legitimate business relationship, Defendants were conducting
their routine business affairs. See, e.g., Lendian Aff. at 26, ¶ 52 (“on occasion Abreu would refuse
to deliver material to Metals USA because he did not like the prevailing market price per ton”).
Moreover, the evidence in the record supports the allegation that Defendants purchased scrap metal
from Abreu’s purported company pursuant to what they believed to be a legitimate business
relationship independent from the theft ring that was initially facilitated by Lendian’s business
contact and known broker, Encarnacion. Fleites Dep. 113:2-12, 120:10-13; Metals Dep. 27:5-6;
Rodriguez Dep. 45:17-19; Lendian Aff. at 22, ¶¶ 6-7; ECF No. [264-8] at 66-67. There is also
evidentiary support for the assertion that Lendian had no involvement in, direction of, or control
over the theft operation at Plaintiffs’ facility. Hr’g Tr. 24:22-25:8 (that Plaintiffs’ employees only
named Abreu, not Lendian, in their confessions); Gerding Dep. at 71:15-72:8 (same); Hr’g Tr. at
56:3-57:14 (that Abreu was caught on video giving Plaintiffs’ employees envelopes of cash);
Gerding Dep. 61:2-64:25 (same); ECF No. [264-8] at 17 (that Lendian had never met Jose
Rodriguez); id. at 65 (that Lendian did not “know anyone”); id. at 69 (that Lendian did not know
Pedro worked with Abreu). This evidence, and the inferences drawn from this evidence, presents
genuine issues of material fact as to whether Defendants operated as a continuing unit with the
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theft ring participants for the common purpose of stealing Plaintiffs’ scrap metal. Thus, Plaintiffs
have not met their burden of establishing the existence of a RICO enterprise here. Accordingly,
Plaintiffs’ Motion for Summary Judgment on their substantive RICO claims is denied.
2. Federal and Florida Civil RICO Conspiracy Claims (Counts II and IV)
With regard to a civil RICO conspiracy claim, § 1962(d) makes it “unlawful for any person
to conspire to violate any of the [RICO] provisions.” 18 U.S.C. § 1962(d). “A plaintiff can establish
a RICO conspiracy claim in one of two ways: (1) by showing that the defendant agreed to the
overall objective of the conspiracy; or (2) by showing that the defendant agreed to commit two
predicate acts.” Republic of Pan. v. BCCI Holdings (Luxembourg) S.A., 119 F.3d 935, 950 (11th
Cir. 1997). Thus, “[t]he touchstone of liability is an agreement to participate in a RICO
conspiracy.” United States v. Browne, 505 F.3d 1229, 1264 (11th Cir. 2007); O’Malley v. O’Neill,
887 F.2d 1557, 1560 (11th Cir. 1989) (explaining that, to assert a RICO conspiracy claim, facts
must be alleged “that would indicate that [defendants] were willing participants in a conspiracy”).
Because there are fewer proof requirements under § 1962(d) than under the
substantive RICO offenses — most notably, through the absence of the requirement
of an overt act — the conspiracy offense reaches a wider range of conduct. A
defendant may be guilty of conspiracy even if he did not commit the substantive
acts that could constitute violations of §§ 1962(a), (b), or (c). . . . “If [a party] can
prove an agreement on an overall objective, it need not prove a defendant
personally agreed to commit two predicate acts.” In the absence of direct evidence
of an agreement on an overall objective, [a party] may prove such an agreement
through “inferences from the conduct of the alleged participants or from
circumstantial evidence of a scheme,” amounting to evidence that each defendant
necessarily must have known that the others were also conspiring to participate in
the same enterprise through a pattern of racketeering.
Browne, 505 F.3d at 1263-64 (citations omitted). To support a RICO conspiracy claim, Plaintiffs
must allege “an illegal agreement to violate a substantive provision of the RICO statute.” Jackson,
372 F.3d at 1269. “To be guilty of conspiracy . . . parties must have agreed to commit an act that
is itself illegal.” Id. (quoting United States v. Vaghela, 169 F.3d 729, 732 (11th Cir. 1999)). “In
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addition to predicate crimes, a RICO conspiracy charge requires proof of an enterprise, of the
continuity of racketeering activity, and of the defendant’s knowledge of, agreement to, and
participation in the conspiracy.” United States v. Gonzalez, 921 F.2d 1530, 1546 (11th Cir. 1991).
As with the substantive RICO claims, the existence of a genuine issues of material facts as
to the enterprise element applies with equal force to Plaintiffs’ RICO conspiracy claims. Because
“a RICO conspiracy charge requires proof of an enterprise,” the Court concludes that Plaintiffs’
Motion for Summary Judgment on these claims must also be denied. Id. As discussed at length
above, the record in the instant case presents genuine questions of fact as to whether Defendants
were transacting with Abreu for their own independent, economic gain pursuant to a legitimate
business relationship, rather than associating for the alleged enterprise’s common purpose. To the
extent that these issues require credibility determinations or the weighing of evidence, they must
be resolved by a jury. See Lewis, 934 F.3d at 1179.
C. Defendants’ Motion for Summary Judgment
Defendants move for summary judgment on Plaintiffs’ RICO claims and their unjust
enrichment claim. Similar to their arguments in opposition to Plaintiffs’ Motion for Summary
Judgment, Defendants argue that no genuine issues of fact exist because Plaintiffs cannot prove
the enterprise and continuity elements of their RICO claims under Counts I through IV. Defendants
contend that “Plaintiffs’ allegations and evidence make clear that the claims are based on a single
scheme with a discrete goal and a limited number of victims and no threat of continuing illegal
activity. The RICO statutes were not meant to reach such one-time, everyday theft schemes.” ECF
No. [261] at 1-2 (emphasis omitted). Defendants also argue that Plaintiffs’ unjust enrichment claim
fails as a matter of law because a claim for unjust enrichment cannot be predicated on alleged
wrong acts to support the “unjust” factor.
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In response, Plaintiffs argue that, consistent with the arguments in their Motion for
Summary Judgment, the RICO claims are proven by undisputed material facts. Likewise, Plaintiffs
allege that Defendants have failed to submit sufficient evidence of undisputed facts to warrant
summary judgment in their favor. Plaintiffs further argue that Defendants’ unjust enrichment
arguments are unsupported by any facts in the record, are legally incorrect, and are an improper
attempt to renew their motion to dismiss arguments that were previously denied. Plaintiffs also
assert that the arguments regarding the unjust enrichment claim must fail because this claim is pled
in the alternative, regardless of issues of fault.
In reply, Defendants argue that the allegations and evidence clearly establish one scheme
with one goal and two victims, which was allegedly carried out by a handful of individuals acting
for their own economic gain, rather than for the benefit of a RICO enterprise. Defendants also state
that the law precluding unjust enrichment claims based on wrongful acts is clear — namely, the
benefit conferred by Plaintiffs cannot be based on Defendants’ alleged wrongful acts. Additionally,
Defendants contend that Plaintiffs’ unjust enrichment claim relies on the same factual predicates
as the legal causes of action asserted and, therefore, it is not a true alternative theory of relief. As
such, Defendants contend that they are entitled to summary judgment on all counts.
1. RICO Claims
The first argument presented in Defendants’ Motion for Summary Judgment is identical to
the arguments raised in their Response to Plaintiffs’ Motion for Summary Judgment — namely,
that Plaintiffs have failed to produce evidence of the existence of a RICO enterprise because they
have not adduced any evidence establishing that Defendants associated with the participants of the
theft ring for any purpose other than to commit the alleged singular goal of stealing Plaintiffs’
scrap metal. The Court’s analysis on Plaintiffs’ Motion for Summary Judgment addressed and
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rejected Defendants’ arguments regarding the holding in Turkette. Further, the statements of fact
in Defendants’ SOF are premised on their erroneous arguments that a RICO claim requires proof
of more than just a single scheme with a discrete goal and a limited number of victims and no
threat of continuing illegal activity. However, because the Court has already rejected Defendants’
argument that Turkette requires a party to prove an entity distinct from the pattern of activity in
which it engages, these facts do not establish the absence of a triable issue of fact as to the
enterprise element of Plaintiffs’ RICO claims.
When the nonmoving party has the burden of proof at trial, the moving party is not
required to “support its motion with affidavits or other similar material negating
the opponent’s claim,” Celotex, 477 U.S. at 323, in order to discharge this “initial
responsibility.” Instead, the moving party simply may “‘show[]’—that is, point[]
out to the district court — that there is an absence of evidence to support the
nonmoving party’s case.” Id. at 324.[n.19] Alternatively, the moving party may
support its motion for summary judgment with affirmative evidence demonstrating
that the nonmoving party will be unable to prove its case at trial. Id. at 331
(Brennan, J., dissenting). If the moving party shows the absence of a triable issue
of fact by either method, the burden on summary judgment shifts to the nonmoving
party, who must show that a genuine issue remains for trial. Fed. R. Civ. P. 56(e);
Chanel, Inc. v. Italian Activewear, Inc., 931 F.2d 1472, 1477 (11th Cir. 1991). If
the nonmoving party fails to “make a sufficient showing on an essential element of
her case with respect to which she has the burden of proof,” Celotex, 477 U.S. at
323, the moving party is entitled to summary judgment.
[n.19] . . . In [the Eleventh Circuit], “[e]ven after Celotex, it is never
enough simply to state that the non-moving party cannot meet its
burden at trial.” Clark v. Coats & Clark, Inc., 929 F.2d 604 (11th
Cir. 1991); see also Celotex, 477 U.S. at 328 (White, J., concurring)
(“it is not enough to move for summary judgment without
supporting the motion in any way or with a conclusory assertion that
the plaintiff has no evidence to prove his case”) . . . . Instead, the
moving party must point to specific portions of the record in order
to demonstrate that the nonmoving party cannot meet its burden of
proof at trial. Id. at 325 (“a party seeking summary judgment always
bears the initial responsibility . . . of identifying those portions of the
materials on file which demonstrate the absence of a genuine issue
of material fact” (emphasis added)).
United States v. Four Parcels of Real Prop. in Greene & Tuscaloosa Ctys. in State of Ala., 941
F.2d 1428, 1437-38 (11th Cir. 1991) (footnotes omitted) (“Four Parcels”). Consistent with the
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Court’s discussion above, the instant case presents genuine issues of material fact with regard to
the existence of a RICO enterprise. Therefore, Defendants’ Motion for Summary Judgment on this
issue is denied.
Defendants’ next argument regarding the continuity element fares no better. Specifically,
Defendants argue that Plaintiffs cannot establish continuity in this case because the alleged theft
ring was a single scheme with a discrete goal and a limited number of victims and no threat of
continuing illegal activity. Thus, Defendants move for summary judgment on Plaintiffs’ RICO
claims based on their inability to prove continuity. Because Defendants only challenge the
continuity component of RICO’s “pattern of racketeering activity,” the Court need not address the
other components under this element.
“An act of racketeering is commonly referred to as a ‘predicate act.’” Edwards v. Prime,
Inc., 602 F.3d 1276, 1292 (11th Cir. 2010). A pattern of racketeering activity “is shown when a
racketeer commits at least two distinct but related predicate acts.” Id.14 However, a “‘pattern of
racketeering activity’ requires proof of something beyond the two predicate acts themselves,”
which the Supreme Court has described as “‘continuity plus relationship’ among the predicates.”
Gonzalez, 921 F.2d at 1545 (citing Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 n.14 (1985)).
“Predicate acts are related to each other if they ‘have the same or similar purposes, results,
participants, victims, or methods of commission, or otherwise are interrelated by distinguishing
characteristics and are not isolated events.’” United States v. Starrett, 55 F.3d 1525, 1543 (11th
Cir. 1995) (quoting Sedima, 473 U.S. at 496 n.14). “To establish a RICO pattern it must also be
In a federal RICO action, a plaintiff “must identify and prove a pattern of racketeering activity, defined
as two ‘predicate acts’ of racketeering activity within a 10 year period.” Langford v. Rite Aid of Ala., Inc.,
231 F.3d 1308, 1311-12 (11th Cir. 2000) (citing 18 U.S.C. § 1961(5)). In a Florida RICO action, however,
a plaintiff must establish a pattern of at least two incidents of criminal activity, Fla. Stat. § 772.102(4), or
of racketeering conduct, Fla. Stat. § 895.02(4), committed within a five-year period.
14
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Case No. 18-cv-60292-BLOOM/Valle
shown that the predicates themselves amount to, or that they otherwise constitute, a threat of
continuing racketeering activity.” H.J. Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 240 (1989).
“Whether the predicates [that are] proved establish a threat of continued racketeering
activity depends on the specific facts of each case.” Id. at 242. “There are two types of continuity
that may establish a RICO claim: closed-ended continuity and open-ended continuity.” Daedalus
Capital LLC v. Vinecombe, 625 F. App’x 973, 976 (11th Cir. 2015) (citing H.J. Inc., 492 U.S. at
241). “Closed-ended continuity refers to ‘a closed period of repeated conduct.’” Id. (quoting H.J.
Inc., 492 U.S. at 241). “A party alleging a RICO violation may demonstrate continuity over a
closed period by proving a series of related predicates extending over a substantial period of time.”
H.J. Inc., 492 U.S. at 242. “This Circuit considers a two year [sic] period a ‘substantial period of
time.’” Colonial Penn Ins. Co. v. Value Rent-A-Car Inc., 814 F. Supp. 1084, 1094 (S.D. Fla. 1992).
“Open-ended continuity refers to ‘past conduct that by its nature projects into the future
with a threat of repetition.’” Daedalus Capital LLC, 625 F. App’x at 976 (quoting H.J. Inc., 492
U.S. at 241). For example, “[a] RICO pattern may surely be established if the related predicates
themselves involve a distinct threat of long-term racketeering activity, either implicit or explicit.”
H.J. Inc., 492 U.S. at 242. The threat of continuity may also be established in cases where “the
predicate acts or offenses are part of an ongoing entity’s regular way of doing business. Thus, the
threat of continuity is sufficiently established where the predicates can be attributed to a defendant
operating as part of a long-term association that exists for criminal purposes.” Id. at 242-43. “The
continuity requirement is likewise satisfied where it is shown that the predicates are a regular way
of conducting defendant’s ongoing legitimate business (in the sense that it is not a business that
exists for criminal purposes), or of conducting or participating in an ongoing and legitimate RICO
‘enterprise.’” Id. at 243.
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Here, the Court concludes that the evidence in the record presents genuine issues of
material fact as to continuity, which warrant the denial of Defendants’ Motion for Summary
Judgment. First, with regard to closed-ended continuity, the evidence establishes a series of 538
individual thefts of scrap metal from Plaintiffs’ facility and were delivered to Metals USA. Fleites
Dep. 131:20-132:5; see generally ECF No. [264-7]. These thefts spanned over a period of more
than three years, from approximately April 2014 to January 2018, when Plaintiffs ultimately
uncovered the scheme. Hr’g Tr. 19:16-19, 59:13-15, 83:21-84:20; Abreu Aff. ¶¶ 2-4; Gerding Dep.
43:10-17. Further, facts in the record support the assertion that Defendants committed the
additional predicate acts of placing stolen materials into the stream of commerce, Hr’g Tr. 105:1718; Lendian Aff. at 23, ¶ 21; committing wire fraud, see Abreu Aff. ¶¶ 5-6; Hr’g Tr. 93:14-18;
ECF No. [264-8] at 4-5; and the conspiracy to commit these acts, Abreu Aff. ¶¶ 8-9; Hr’g Tr.
100:23-101:13, 148:9-149:5.
Likewise, with regard to open-ended continuity, the evidence demonstrates issues of
material fact as to the threat of continuing racketeering activity. In particular, the record evidence
establishes ongoing instances of criminal activity, and the threat of such continued activity, at the
time Plaintiffs uncovered the theft ring. Gerding Dep. 49:2-62:6 (regarding Plaintiffs’ discovery
of the ongoing theft scheme through Torres’s confession); Gerding Dep. 61:11-64:25 (regarding
catching Abreu on video giving Torres an envelope of cash); Hr’g Tr. 56:3-10 (same); Hr’g Tr.
83:21-84:20 (regarding Abreu getting fired in February 2018 for his involvement in the theft ring
at Plaintiffs’ facility). Defendants do not provide any factual or evidentiary proof that the scheme’s
duration was discrete or time-limited in nature.15 See Defs.’ CSOF, ECF No. [272] at 1-18.
Cf. Daedalus Capital LLC, 625 F. App’x at 976-77 (no threat of continued racketeering activity “because
[participants’] goal has been realized in the acquiring of the QU Project, and there is no longer a working
relationship between the two companies giving rise to the opportunity for Defendants’ pattern of predicate
acts to persist into the future.” (emphasis added)); Vicom, Inc. v. Harbridge Merch. Servs., Inc., 20 F.3d
15
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Case No. 18-cv-60292-BLOOM/Valle
Likewise, the facts in evidence demonstrate that many of Plaintiffs’ customers were
victimized by the theft ring because these customers were ultimately undercompensated for the
amount of the material delivered due to the alteration of the scale weights. ECF No. [264-8] at 8586 (Abreu: “That the victims are the . . .” Lendian: “The clients.”); Hr’g Tr. 34:5-13 (scale
manipulation resulted in underpaying customers); Gerding Dep. 54:15-57:5 (same); Abreu Aff. ¶¶
17, 19 (regarding altering the weight on Plaintiffs’ scales). The record also contains facts
supporting the assertion that Defendants’ were involved in the theft ring as a way of conducting
their ongoing legitimate business. Fleites Dep. 113:5-114:23; Metals Dep. 27:5-29:19; Rodriguez
Dep. 46:6-15; Lendian Aff. at 22, ¶¶ 6-9; ECF No. [264-8] at 12.
These facts, and the inferences derived therefrom, present legitimate questions of fact
concerning the continuity element. See Lewis, 934 F.3d at 1179; Bannum, Inc., 901 F.2d at 996.
Moreover, that Defendants’ numerous predicate acts were committed pursuant to a single related
theft scheme does not change the Court’s analysis, given the scheme’s expansive, multi-level
nature. See Gonzalez, 921 F.2d at 1545 (holding that repeated past and ongoing commissions of
predicate acts established the pattern of racketeering activity, despite being “in close temporal
proximity and related to a single importation scheme”). Thus, Defendants have failed to establish
the absence of any genuine issues of material fact as to the continuity element here. As such, the
Defendants’ Motion for Summary Judgment must be denied as to this issue.
771, 782 (7th Cir. 1994) (“In assessing whether a threat of continued racketeering activity exists, we have
made clear that schemes which have a clear and terminable goal have a natural ending point. Such schemes
therefore cannot support a finding of any specific threat of continuity that would constitute open-ended
continuity.”). The mere fact that the theft ring in this case was ultimately uncovered is not sufficient to
establish a lack of continuity. See United States v. Busacca, 936 F.2d 232, 238 (6th Cir. 1991) (“An analysis
of the threat of continuity cannot be made solely from hindsight. . . . The lack of a threat of continuity of
racketeering activity cannot be asserted merely by showing a fortuitous interruption of that activity such as
by an arrest, indictment or guilty verdict.”); Lugo v. State, 845 So. 2d 74, 100 n.50 (Fla. 2003) (“Lugo’s
arrest did not obviate the threat of continued criminal activity by the enterprise with which he was
associated.” (citing State v. Lucas, 600 So. 2d 1093 (Fla. 1992))).
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2. Unjust Enrichment Claim
Defendants next argue that Plaintiffs’ unjust enrichment claim fails as a matter of law
because it is premised on Defendants’ alleged wrongful conduct, rather than on a benefit conferred
by Plaintiffs. Plaintiffs, on the other hand, argue that the issue of wrongful, as opposed to unjust,
enrichment has been rejected by other federal courts in the Southern District of Florida. Likewise,
Plaintiffs note that their unjust enrichment claim is pled in the alternative, regardless of the issue
of fault, and that Defendants are improperly attempting to revisit their previously unsuccessful
motion to dismiss arguments on this same issue.
“The elements of an unjust enrichment claim are a benefit conferred upon a defendant by
the plaintiff, the defendant’s appreciation of the benefit, and the defendant’s acceptance and
retention of the benefit under circumstances that make it inequitable for him to retain it without
paying the value thereof.” Fla. Power Corp. v. City of Winter Park, 887 So. 2d 1237, 1242 n.4
(Fla. 2004) (quoting Ruck Bros. Brick, Inc. v. Kellogg & Kimsey, Inc., 668 So. 2d 205, 207 (Fla.
2d DCA 1995)); see also City of Miami v. Bank of Am. Corp., 800 F.3d 1262, 1287 (11th Cir.
2015) (quoting Gonzalez v. Eagle Ins. Co., 948 So. 2d 1, 3 (Fla. 3d DCA 2006)), vacated on other
grounds, 137 S. Ct. 1296 (2017).
As an initial matter, the Court notes that the allegation in Defendants’ SOF relating to their
unjust enrichment arguments cites only to the Amended Complaint. This allegation states, in full:
Plaintiffs’ unjust enrichment claim is based upon Defendants alleged wrongful
conduct, not a benefit conferred by Plaintiffs. Am. Compl., ¶ 110 (“Through the
fraudulent scheme, Lendian, Metals USA, and Universal (collectively, the
‘Lendian Defendants’) have been unjustly enriched at the expense of Plaintiffs.”)
(emphasis added); id. at 111 (“Plaintiffs conferred a benefit on the Lendian
Defendants, when the Lendian Defendants acquired the Plaintiffs’ stolen scrap
metal at well below market rates.”) (emphasis added).
ECF No. [262] ¶ 6.
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Case No. 18-cv-60292-BLOOM/Valle
As explained above, a court should “grant summary judgment if the movant shows that
there is no genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” Fed. R. Civ. P. 56(a) (emphasis added). A party’s initial burden in moving for
summary judgment is to “inform [] the . . . court of the basis for its motion and . . . identify[] those
portions of ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together
with the affidavits, if any,’ which it believes demonstrate the absence of a genuine issue of material
fact.” Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993) (quoting Celotex Corp.,
477 U.S. at 323).
Further, to be entitled to summary judgment, Defendants “must point to specific portions
of the record in order to demonstrate that the nonmoving party cannot meet its burden of proof at
trial.” Celotex Corp., 477 U.S. at 325; see id. (“a party seeking summary judgment always bears
the initial responsibility . . . of identifying those portions of the materials on file which demonstrate
the absence of a genuine issue of material fact”); Four Parcels, 941 F.2d at 1438 n.19 (“In [the
Eleventh Circuit], ‘[e]ven after Celotex, it is never enough simply to state that the non-moving
party cannot meet its burden at trial.’” (quoting Clark, 929 F.2d 604)). In order to satisfy their
burden here, Defendants must provide citations to evidence in the record demonstrating that
Plaintiffs’ cannot meet their burden of proof at trial due to the absence of any genuine issue of fact.
“[A] sworn complaint constitutes summary-judgment evidence, just as if the same
information had been set out in a declaration.” Sanchez v. Sanchez, No. 5:10CV288-RH/EMT,
2015 WL 5016842, at *1 (N.D. Fla. Aug. 24, 2015) (citing Caldwell v. Warden, FCI Talladega,
748 F.3d 1090, 1098 (11th Cir. 2014); Perry v. Thompson, 786 F.2d 1093, 1095 (11th Cir. 1986)).16
See also Blum v. Morgan Guar. Tr. Co. of N.Y., 709 F.2d 1463, 1466 (11th Cir. 1983) (“A motion for
summary judgment may be made solely on the basis of the complaint, in which case the motion is to be
treated as the functional equivalent of a motion to dismiss for failure to state a claim under Fed. R. Civ. P.
16
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Case No. 18-cv-60292-BLOOM/Valle
The single statement included in Defendants’ SOF with regard to unjust enrichment, however, fails
to set forth any evidence establishing the absence of a genuine issue of fact that would entitle them
to summary judgment. Indeed, Defendants’ SOF on this issue, and the corresponding allegations
from Plaintiffs’ Amended Complaint that are cited, do not identify any facts at all, much less facts
indicating that Plaintiffs cannot meet their burden of proof at trial on their unjust enrichment claim.
Likewise, Judge Zloch previously addressed — and rejected — a nearly identical argument
in Defendants’ motion to dismiss that a claim of unjust enrichment may not be predicated on a
wrong committed by a defendant.
A number of courts hold that a claim of unjust enrichment may not be
predicated on a wrong committed by a defendant. In Guyana Tel. & Tel. Co. Ltd.
v. Melbourne Inter. Communications, Ltd., the Eleventh Circuit stated in a footnote:
“As soon as [a] claimant relies on a wrong [to supply the unjust factor], the right
on which he relies arises from that wrong, not from unjust enrichment.” 329 F.3d
1241, 1245 n.3 (11th Cir. 2007) (alterations in original) (quoting Peter Birks, Unjust
Enrichment and Wrongful Enrichment, 79 Tex. L. Rev. 1767, 1783 (2001). See also
Flint v. ABB, Inc., 337 F.3d 1326, 1330 n.2 (11th Cir. 2003) (citing to the same
article in a similar footnote). Following the dicta in Guyana, the district court in
State of Fla., Office of Atty. Gen., Dept. of Legal Affairs v. Tenet Healthcare Corp.,
dismissed the plaintiffs’ unjust enrichment claim where the unjust enrichment was
the result of an alleged wrong. 420 F. Supp. 2d 1288 (S.D. Fla. 2005) (as in the
above styled cause, the unjust enrichment claim accompanied RICO claims). In a
line of cases following Tenet, federal district courts in Florida have dismissed unjust
enrichment claims where the mechanism of enrichment was an alleged wrong. See
e.g. Taxinet Corp. v. Leon, 16-24266-CIV, 2018 WL 3405243, at *7 (S.D. Fla. July
12, 2018); Freestyle Slides, Inc. v. Super Sweet Air, Inc., No. 6:17-cv-169-Orl41GJK, 2018 WL 3819073, at *4 (M.D. Fla. July 9, 2018); Swipe For Life, LLC v.
XM Labs, LLC, No. 10-22337-CIV, 2011 WL 13220766, at *5-6 (S.D. Fla. Nov. 8,
2011); Group Assets, LLC v. Fortress Inv. Group, No. 8:09-CV-1530-T-33EAJ,
2010 WL 2951508, at *4 (M.D. Fla. June 22, 2010); Tilton v. Playboy Entm’t
Group, Inc., 88:05-cv-692-T-30TGW, 2007 WL 80858, at *3 (M.D. Fla. Jan. 8,
2007); Union Pacific R.R. Co. v. Paragon Laboratories, Inc., No. 06-60873-CIV,
2006 WL 3709619, at *4 (S.D. Fla. Dec. 14, 2006).
However, other courts reject this position, and maintain that Florida law
makes no distinction between wrongful enrichment and unjust enrichment; these
courts hold that a claim of unjust enrichment may be predicated on a wrong. See
e.g. State Farm Mutual Auto. Inc. Comp. v. Performance Orthopaedics &
12(b)(6). In this posture, the court must construe the complaint liberally in favor of the plaintiff, taking the
facts as alleged as true. The motion should be denied if a claim has been pleaded.” (citation omitted)).
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Case No. 18-cv-60292-BLOOM/Valle
Neurosurgery, LLC, No. 1:17-CV-20028, 2018 WL 2186496, at *14 (S.D. Fla. Feb.
16, 2018); Absolute Activist Value Master Fund Limited v. Devine, 233 F. Supp. 3d
1297, 1329 (M.D. Fla. 2017); State Farm Fire & Cas. Co. v. Silver Star Health and
Rehab Inc., No. 6:10-cv-1103-Orl-31GJK, 2011 WL 6338496, at *6 (M.D. Fla.
Dec. 19, 2011), aff’d sub nom. State Farm Fire & Cas. Co. v. Silver Star Health &
Rehab, 739 F.3d 579 (11th Cir. 2013) (the Eleventh Circuit did not address the
question of whether or not an unjust enrichment claim may be predicated on a
wrong).[17]
AIM Recycling Fla., LLC v. Metals USA, Inc., No. 18-60292-CIV, 2019 WL 1991946, at *1-2
(S.D. Fla. Mar. 4, 2019). Ultimately, the Court declined to address this argument of Defendants’
motion to dismiss, finding the instant case to be distinguishable, because the unjust enrichment
claim was adequately pled in the alternative, irrespective of fault. Id. at *2 (citing United States v.
Liberty Ambulance Serv., Inc., No. 3:11-cv-587-J-32MCR, 2016 WL 81355, at *4 (M.D. Fla. Jan.
7, 2016) (allowing unjust enrichment claim to be pled in the alternative to plaintiff’s legal claims
in anticipation of defendants claiming that no wrong occurred); Senior Management, Inc. v. United
Health Adm’rs, Inc., No. 8:12-cv-2321-T-30MAP, 2013 WL 3285419, at *4 (M.D. Fla. June 27,
2013) (dismissing plaintiff’s unjust enrichment claim because it was predicated on an alleged
wrong, but granting leave to amend complaint to plead unjust enrichment in the alternative)).
Given the failure to demonstrate the absence of any triable issue of fact, the Court
concludes that Defendants’ unjust enrichment arguments constitute an improper attempt to
relitigate their previously unsuccessful motion to dismiss arguments. Further, the Court agrees
with Judge Zloch’s reasoning above. Plaintiffs have pled their unjust enrichment claim here in the
alternative and “[i]rrespective of issues of fault,” ECF No. [24] ¶ 113, and the Court need not
address the issue of whether an unjust enrichment claim may be predicated on an alleged wrong.
But see Rajput v. City Trading, LLC, 476 F. App’x 177, 180 (11th Cir. 2012) (reversing dismissal of
plaintiff’s complaint alleging facts connecting defendants to the alleged fraud sufficient “to support a claim
of unjust enrichment based on Defendants’ control of funds illicitly gained through the fraud”).
17
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Case No. 18-cv-60292-BLOOM/Valle
Therefore, the Court concludes that Defendants are not entitled to summary judgment on Plaintiffs’
unjust enrichment claim.
V.
CONCLUSION
Accordingly, it is ORDERED AND ADJUDGED as follows:
1. Plaintiffs’ Renewed Motion for Partial Summary Judgment as to Liability, ECF
No. [263], is DENIED.
2. Defendants’ Motion for Summary Judgment, ECF No. [261], is DENIED.
DONE AND ORDERED in Chambers at Miami, Florida, on January 13, 2020.
_________________________________
BETH BLOOM
UNITED STATES DISTRICT JUDGE
Copies to:
Counsel of Record
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