Trueger
Govett American Endeavor Fun Ltd. v. Trueger
Opinion
Lead Opinion
Noonan, J.
Opinion by Judge NOONAN; Dissent by Judge GOODWIN.
The American Endeavour Fund, Limited, (American Endeavor) appeals the dismissal by the district court of its action under the Racketeer Influenced Corrupt Organization Act, (RICO), 18 U.S.C. § 1961 , et seq. and the statutory and common law of California brought against Arthur I. Trueger (Trueger); Berkeley International Capital Corporation *1019 (Berkeley); Govett & Company Limited (Govett); and Berkeley Govett International Limited (BGIL). The district court found that all of American Endeavor’s causes of action were governed by Jersey law according to agreements between the parties and that “[b]eeause Jersey law does not recognize RICO, the Court lacks subject matter jurisdiction.” Holding that the defendants could not by contract insulate themselves from civil liability based on crimes committed in California, we reverse the district court and remand.
ALLEGATIONS
As the case was dismissed on the pleadings, we accept the allegations of the complaint as true without passing on their truth in fact. We summarize the allegations, supplemented by the agreements submitted by the parties, as follows:
Trueger is a citizen of the…
Dissenting Opinion
Goodwin, J.
dissenting:
I would affirm the dismissal of the ease for lack of subject matter jurisdiction. The parties chose Jersey law to govern their relationship. Jersey law does not recognize a RICO cause of action and therefore no subject matter jurisdiction lies in the federal courts.
I. Scope of the Clause
The choice-of-law provision agreed to by the parties states that: “This Agreement shall be governed by and construed in accordance with the laws of Jersey and the parties hereto submit to the non-exclusive jurisdiction of the Royal Court of Jersey.” The majority completely fails to analyze the scope of this clause and assumes that it cannot encompass the claims American Endeavor Fund Limited (“American Endeavor”) alleges. This failure leads the majority to an incorrect conclusion.
Clearly, “the clause refers to more than construction of the agreement,” Moses v. Business Card Express, Inc., 929 F.2d 1131, 1139-40 (6th Cir.1991), or “governed by” would be surplusage. I agree with the California Supreme Court that “[t]he phrase ‘governed b/ is a broad one,” Nedlloyd Lines B.V. v. Superior Court, 3 Cal.4th 459 , 11 Cal.Rptr.2d 330, 336 , 834 P.2d 1148, 1154 (1992), and that “[wjhen…