On May 20, 2025, Joel Wertman and Doug Fogle of Winget, Spadafora & Schwartzberg LLP’s Philadelphia, Pennsylvania office successfully prevailed on a motion to dismiss on behalf of its client, a financial services and advisory firm, in a civil Racketeer Influenced and Corrupt Organizations (“RICO”) case pending before the United States District Court for the Southern District of New York wherein the Complaint sought damages in excess of $300 million.
The nearly 500 paragraph complaint alleged that the purported fraudster procured withdrawals of bond proceeds with falsified information and documentation indicating that the proceeds would be used to purchase capital to secure the bonds, when in fact the funds were allegedly diverted. In dismissing the case, the Court concurred with WSS’s argument that the Private Securities Litigation Reform Act barred the Plaintiffs’ RICO claims because predicate acts of the RICO enterprise sounded in securities fraud. The Court further found that it was “irrelevant that some of the other predicate acts alleged in the Amended Complaint, such as sale of stolen goods, the fraudulent misattribution of revenue, and bankruptcy fraud, do not sound in securities fraud” because the Complaint alleged a RICO enterprise engaged in a single scheme of racketeering activity. Therefore, a single predicate act barred by the RICO Amendment is fatal to the entire claim.
Joel Wertman, a partner with WSS’s Philadelphia office was lead counsel for the matter. Doug Fogle collaborated with Mr. Wertman on briefing.
