Docket 23-365
Horn
DecidedApr 2, 2025
5-4decision
Source: CourtListener.
People who lose their jobs due to a fraudulent product can sue under federal racketeering law even if the harm flowed from a personal injury
Impact5/10
What it does
The Court held that RICO's civil lawsuit provision — which allows recovery for harm to "business or property" — does not automatically block claims just because the business or property loss flowed from a personal injury. The word "injured" in the statute means "harmed," so a plaintiff whose business or property was harmed can sue regardless of whether a personal injury was also part of the causal chain. The ruling resolves a split among federal appeals courts that had divided on this question for decades.
Who benefits
People who suffer economic losses — such as job loss or lost income — as a result of a company's fraudulent or criminal conduct, even when that conduct also caused a physical or personal harm, now have a clearer path to bring a civil RICO lawsuit seeking triple damages.
Who is affected
Companies and individuals accused of racketeering activity (such as mail or wire fraud) face expanded civil liability, because plaintiffs whose economic losses trace back through a personal injury can no longer be categorically blocked from suing under RICO.
Practical impact
Plaintiffs who suffer economic losses — like job termination — traceable to a company's fraudulent conduct can no longer be thrown out of court simply because a personal harm (such as unwittingly ingesting a substance) was part of the causal chain. However, the Court left open whether specific types of losses like lost wages or medical expenses qualify as "business or property" harm under RICO, meaning lower courts will still need to resolve those questions. Companies facing civil RICO claims will need to contest causation and the nature of the alleged harm rather than relying on a blanket personal-injury bar to defeat such suits at the outset.
Majority — Barrett
Joined by: Sotomayor, Kagan, Gorsuch, Jackson
The majority held that the ordinary meaning of "injured" is simply "harmed or damaged," and that RICO's phrase "injured in his business or property" means the plaintiff's business or property was harmed — nothing more. The Court reasoned that the "business or property" requirement limits the kind of harm a plaintiff can recover for (not personal pain and suffering), but it does not bar recovery just because a personal injury was somewhere in the chain of events that led to the business or property loss. Using the example of a gas station owner beaten in a robbery, the Court explained that while he cannot recover for his pain and suffering, he can recover for the loss of his business if the injuries forced him to close — the cause of the harm does not disqualify the claim, only the type of harm does. The majority rejected the defendant's argument that "injured" carries a specialized legal meaning requiring the invasion of a tort-law-recognized right in one's business or property, finding that argument unsupported by the statute's text, the Court's own prior RICO decisions, and unworkable in practice. The Court also noted that other built-in RICO requirements — including the need to show a direct relationship between the racketeering conduct and the harm, and the need to establish a pattern of criminal activity — already limit the reach of civil RICO suits without adding a categorical personal-injury bar.
Dissent reasoning
Justice Kavanaugh, joined by the Chief Justice and Justice Alito, argued that "injured" is a longstanding tort-law term of art meaning the invasion of a legally protected right — not merely any harm or loss — and that Congress deliberately borrowed this meaning from antitrust law when it wrote RICO. Under tort law, the dissent explained, injury and damages are distinct concepts: injury is the wrongful invasion of a legal right (such as a right in one's person, property, or business), while damages are the losses that flow from that injury. So when a plaintiff suffers only a personal injury, lost wages and medical bills are merely the damages from that personal injury — not independent business or property injuries — and RICO does not authorize suit for them. The dissent warned that the majority's reading would effectively federalize vast swaths of ordinary state personal-injury tort law, allowing plaintiffs to repackage everyday product liability or accident claims as federal RICO suits seeking triple damages, a result Congress never intended when it excluded personal-injury suits from RICO. Justice Thomas dissented separately, arguing the Court should have dismissed the case without deciding the question at all, because the parties disputed the threshold factual issue of whether the plaintiff even suffered a personal injury — making the legal question potentially advisory — and because neither party had fully briefed the complete meaning of the phrase "injured in his business or property."
Constitutional question
Does the federal racketeering law (RICO) bar a plaintiff from seeking treble damages for losses to their business or property when those losses resulted from a personal injury caused by the defendant's racketeering activity?
Precedent changed
The ruling deepens and resolves a circuit split, rejecting the "antecedent-personal-injury bar" adopted by the Sixth, Seventh, and Eleventh Circuits, though the Court did not formally overrule those circuit decisions — it affirmed the Second Circuit's contrary approach.