Smallwood v. Lupoli, (2nd Cir. 2009)

Docket Number: 07-4445

Parts: SUM

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07-4445-cv

Smallwood v. Lupoli

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUM M ARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO SUM M ARY

ORDERS FILED AFTER JANUARY 1, 2007, IS PERM ITTED AND IS GOVERNED BY THIS COURT'S

LOCAL RULE 32.1 AND FEDERAL RULE OF APPELLATE PROCEDURE 32.1. IN A BRIEF OR OTHER

PAPER IN WHICH A LITIGANT CITES A SUM M ARY ORDER, IN EACH PARAGRAPH IN WHICH A

CITATION APPEARS, AT LEAST ONE CITATION M UST EITHER BE TO THE FEDERAL APPENDIX OR

BE ACCOM PANIED BY THE NOTATION: "(SUM M ARY ORDER)." A PARTY CITING A SUM M ARY

ORDER M UST SERVE A COPY OF THAT SUM M ARY ORDER TO GETHER W ITH THE PAPER IN

W HICH THE SUM M ARY ORDER IS CITED ON ANY PARTY NOT REPRESENTED BY COUNSEL

UNLESS THE SUM M ARY ORDER IS A VAILABLE IN AN ELECTRONIC DATABASE W HICH IS

PUBLICLY ACCESSIBLE W ITHOUT PAYM ENT OF FEE (SUCH AS THE DATABASE AVAILABLE AT

HTTP://W W W .CA2.USCOURTS.GOV/). IF NO COPY IS SERVED BY REASON OF THE AVAILABILITY

OF THE ORDER ON SUCH A DATAB ASE, TH E CITATION M UST INCLUDE REFERENCE TO THAT

DATABASE AND THE DOCKET NUM BER OF THE CASE IN W HICH THE ORDER W AS ENTERED.

At a stated term of the United States Court of Appeals for the Second Circuit, held at

the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New

York, on the 4 th day of March, two thousand nine.

PRESENT: HONORABLE REENA RAGGI,

HONORABLE PETER W. HALL,

Circuit Judges,

HONORABLE GERARD E. LYNCH, District Judge.1 KEISHMA SMALLWOOD, by and through the Guardian of her person, EDITHA HILLS, ALICE COLLINS, for herself and for the benefit of her mother, ALICE DAILYDA, Plaintiffs-Appellants, v. No. 07-4445-cv MATTHEW M. LUPOLI, ALBERT BASAL, FRED BASAL, TONY ZADEH, PLAZA HOMES, LLC, UNIVERSAL DEVELOPMENT LLC, GEORGE J. BRUCKER, PETER M. REDMOND, PETER M. REDMOND, P.C., Defendants-Appellees. APPEARING FOR APPELLANTS: EDWARD G. BAILEY, Bailey & Sherman, P.C., Douglaston, New York.

APPEARING FOR APPELLEES: PATRICK F. BRODERICK, Bayside, New York, for appellees Matthew M. Lupoli, Albert Basal, Fred Basal, Tony Zadeh, Plaza Homes, LLC, and Universal Development, LLC; PETER M. REDMOND, Bayside, New York, pro se, and for appellee Peter M. Redmond, P.C.; JOSEPH V. DIBLASI, New York, New York, for appellee George J. Brucker.

Appeal from the United States District Court for the Eastern District of New York (Joseph F. Bianco, Judge).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that the judgment of the district court, entered on September 17, 2007, is AFFIRMED.

Plaintiffs Keishma Smallwood, Editha Hills, Alice Collins, and Alice Dailyda appeal an award of summary judgment in favor of defendants on substantive and conspiratorial claims of racketeering, see 18U.S.C. § 1962(c), (d), in connection with the auctioning of two properties entrusted to the care of court-appointed guardian Matthew M. Lupoli.2 On our de novo review of the district court's grant of summary judgment, see Mathirampuzha v. Potter, 548 F.3d 70, 74 (2d Cir. 2008), we assume the parties' familiarity with the facts and procedural history of this case, which we reference only as necessary to explain our decision. In awarding summary judgment, the district court held that plaintiffs failed to adduce sufficient evidence that defendants operated as an association-in-fact, a prerequisite to both their substantive and conspiratorial claims of racketeering. See 18U.S.C. §§ 1962(c), (d) & 1961(4). We agree. The fact that defendants -- a court-appointed guardian, an attorney retained by the guardian, an appraiser, certain bidders and the corporate entities through which they operated -- were repeat players in two property auctions is insufficient, by itself, to permit a reasonable factfinder to conclude that they functioned as a unit to accomplish the alleged unlawful objective of rigging the properties' at-auction sales prices. See United States v. Turkette, 452 U.S. 576, 583 (1981) (explaining that RICO 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. Coonan, 938 F.2d 1553, 1559-60 (2d Cir. 1991) (observing that association-in-fact "is oftentimes more readily proven by what it does, rather than by abstract analysis of its structure" (emphasis in original) (internal quotation marks omitted)). Indeed, except for an isolated pre-sale inquiry, Lupoli denied having discussed the properties with the defendant bidders before they were sold. The purchasers testified similarly. Plaintiffs introduced no contrary evidence.

Instead, plaintiffs submit that circumstantial evidence -- in particular, Editha Hills's deposition testimony that she was introduced to the winning bidder and informed of the winning bid for the Smallwood property before the auction took place -- would support an inference that defendants functioned as the necessary racketeering unit. Without further support, however, such an inference is not reasonable when the uncontroverted evidence is that both auctions were public and attended by dozens of individuals, and that persons unaffiliated with the defendants actually bid on the properties. Thus, the circumstantial evidence cannot support a reasonable finding of a unifying objective or an association-in-fact to coalesce around it. See United States v. Turkette, 452 U.S. at 583; United States v.

Coonan, 938 F.2d at 1559-60.

In an effort to avoid this conclusion, plaintiffs, at oral argument, asserted that the unaffiliated bidders were somehow coerced or pressured by the defendant bidders, some of whom were previously convicted -- years ago -- for conspiring to rig bids on stateauctioned properties. Plaintiffs have failed to demonstrate the admissibility of such convictions. See Fed. R. Evid. 404(b); see also Fed. R. Civ. P. 56(e). Although plaintiffs had an opportunity to pursue discovery from the unaffiliated bidders, they have adduced nothing beyond conjecture or speculation regarding their participation in any rigging scheme.

See Major League Baseball Properties, Inc. v. Salvino, Inc., 542 F.3d 290, 310 (2d Cir. 2008) (explaining that bald conclusions or speculation cannot defeat summary judgment motion).

Because we conclude that plaintiffs failed to adduce sufficient evidence of a RICO enterprise, we need not consider their challenges to the alternative deficiencies in proof identified by the district court in granting summary judgment.

The judgment of the district court is AFFIRMED.

FOR THE COURT: CATHERINE O'HAGAN WOLFE, Clerk of Court By:

1 The Honorable Gerard E. Lynch, of the United States District Court for the Southern District of New York, sitting by designation.

2 Having dismissed these federal claims, the district court declined to exercise supplemental jurisdiction over the companion state-law claims. Because appellants do not challenge that aspect of the district court's judgment, we deem any such argument waived. See In re U.S. Wireless Data, Inc., 547 F.3d 484, 492 (2d Cir. 2008).