United States District Court, S. D. New York.

“ Those cases involved allegations of the prosecutor misleading the grand jury. The thrust of Moon's claim is that the additional witnesses are more credible than those who testified before the grand jury. This is not a proper ground to attack an indictment returned by a legally constituted grand jury. To require the Government to present the defendant's choice of witnesses to the grand jury would "convert a grand jury proceeding from an investigative one into a mini-trial of the merits." ”

“ Where the claims underlying an action are legally dubious, there is, in this Court's view, all the more reason to avoid the possible injustice of entering a default judgment against one of the several defendants without examining the legal soundness of the claims raised. ”

“ The Government contends that all the witnesses need not be produced in any event and that a representative number should suffice, there being a number of those present in the United States. The Government's proof, however, involves only a portion of the total disbursement. It would appear, therefore, that the defendants would have to prove all (or nearly all) of the collections for the fund to rebut the Government's claims. ”

“ The Second Circuit went on to note, however, that when "a prosecutor is aware of any substantial evidence negating guilt he should, in the interest of justice, make it known to the grand jury, at least where it might reasonably be expected to lead the (grand) jury not to indict." ”

“ A loss of future income as a forensic expert is not compensable under RICO by anyone involved in discrediting the expert's testimony and views any more than it is compensable against the court involved. ”

“ Although there is no mechanical rule for determining when depositions should be allowed, the generally accepted requirements are that the testimony of the "prospective" witness is material and that the witness is unavailable. ”

“ Government has no threshold obligation, before seeking a perjury indictment, to take reasonable steps to insure that an erroneous answer by a witness is in fact an intentional lie and not merely a mistake or product of faulty memory; and (4) questions and answers relating to defendant's ownership of certain stock and relating to bank accounts in that defendant's name could not be deemed immaterial to grand jury's investigation into whether the defendants had violated federal tax law. ”

“ Even if it were possible to consider plaintiffs' allegations in conjunction with Judge Jensen's conclusions in Fishman and conclude that Judge Jensen was somehow "duped" by defendants' improper acts (and, in this Court's view, it is not possible to do so) , [7] no RICO causation could be shown. Defendants' acts did not proximately cause plaintiffs' alleged injury. The diligent efforts of some (though not necessarily all) of the defendants to discredit plaintiffs' theories did not legally "cause" their loss of income any more than Judge Jensen did. ”

“ Moreover, because of the scope of the testimony, the Court does not have the option of waiting to see how the trial testimony develops before focusing on the issue.
(3) The 120 witnesses whom the defendants seek to depose are also unavailable *560 within the meaning of Rule 15. These individuals are neither presently residing in the United States nor subject to the subpoena power of this Court and are purportedly unable, or unwilling, for various reasons, to come to the United States. They are, however, willing to be deposed in their native land. ”

“ Town of West Hartford, 792 F.Supp. at 168 (defendants' "overarching motive" is not to make money, but to stop plaintiff from performing abortions) . Similarly, the fact that plaintiffs here may lose income or that various organizations may be spared civil liability costs is incidental to defendants' alleged objective of discrediting coercive persuasion. As the court concluded in Scheidler, it seems unreasonable under Ivic to equate economic effect on the plaintiffs or third parties with economic motive. ”

“ That the misstatement in DiVarco did not concern the "Wages, salaries, tips, and other employee compensation" line on the income tax return is of no importance.
In light of DiVarco, this Court is not prepared to conclude so early in the case that Moon's representation, if false, was not material. Listing the Unification Church as the source of income clearly had a potential negative impact on the administrative operations of the IRS-besides the obvious problems of verification, such a statement concealed the existence of the Chase accounts and the interest they generated. ”

“ However broadly RICO's language and purpose could be extended, to apply RICO to the circumstances alleged here would be beyond any reasonable application in light of Ivic and Bagaric. Assuming that plaintiffs have plead an "enterprise," [2] the enterprise clearly lacks an economic motivation. In the first paragraphs of the Amended Complaint, plaintiffs define the objectives of defendants' enterprise. [3] Defendants' alleged motivation was to discredit plaintiffs' theory of coercive persuasion in order to protect from civil liability the Unification Church and other organizations. ”

“ At a pretrial conference on January 15, 1982, the Court denied Moon's motions to dismiss on the ground that this is a selective prosecution, for a severance, for discovery of electronic surveillance, and for a hearing to determine the qualifications of any interpreter appointed by the Court. Moon's motion to suppress any evidence shown to have been obtained illegally was denied in the absence of proof that any evidence had been obtained in an illegal manner. ”

“ Plaintiffs allege injury to their business in terms of loss of income as a result of injury to their reputations as forensic experts. (Am.Compl. ¶¶ 274, 276.) This Court finds the causal link between defendants' alleged acts and plaintiffs' alleged injury to be too attenuated. [6] It is simply absurd to attribute plaintiffs' alleged injury primarily to the Fishman court's conclusions, which in turn resulted from a full adversarial evidentiary hearing and briefing. ”

“ On December 15, 1981, the grand jury returned a superseding indictment that adds an additional perjury count against Kamiyama and makes certain changes in the language of other counts.
The defendants have made a number of substantive and procedural motions, many of which have already been decided. [FN3] Several motions remain outstanding. Moon moves to dismiss the tax counts on the ground that they are legally insufficient and to dismiss all the counts on the grounds of prosecutorial misconduct and abuse of the grand jury process. ”

“ It shall be 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 of indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt.↑ Pursuant to 18 U.S.C. § 1961 (4) , " 'enterprise' includes any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity." ”

“ That evidence of coercive persuasion was not admitted in Fishman (and in several actions since then) does not mean that the academic or legal debate must cease. The First Amendment will continue to protect plaintiffs', as well as defendants', assertion of their views regardless of the seemingly overly zealous efforts of defendants or the so-called cults they allegedly seek to protect. ”

“ Defendant Stark was aware of the lawsuit prior to being served himself; he was also aware that a joint motion to dismiss had been filed by the other defendants. The tardiness of service upon him and the fact that he had not previously been party to litigation contributed to his mistake that he was "covered" by the joint motion to dismiss and that he need not respond individually. (Lieberman Aff. ¶¶ 5-6.) Upon receiving plaintiff's motion seeking entry of default judgment, he promptly consulted an attorney, realizing that he might need to respond individually. ”

“ FN1. Moore's also lists a third factor, that the deposition is necessary to prevent a failure of justice. This is taken from the original language of Rule 15 (a) . See note 2 infra. According to Moore's, this factor is likely to be satisfied if the first two factors are met. ”

“ I. The Tax Counts The first area of dispute concerns the tax counts of the indictment. Moon moves to dismiss counts two, three, and four, which charge Moon with knowingly and wilfully filing false income tax returns for the years 1973, 1974, and 1975, a violation of 26 U.S.C. s 7206 (1) (1976) , and count one insofar as it charges a conspiracy to file false tax returns. ”

“ Defendants are correct to note that any of plaintiffs allegations relating to statements made in the course of judicial proceedings (there are certainly several such statements) are privileged and cannot be the basis of a RICO cause of action. Under California law, presumably relevant to both the Molko and Fishman actions, any communication made in judicial or quasi-judicial proceedings by litigants or other participants authorized by law to achieve the objects of the litigation and that have some connection or logical relation to the action are privileged. ”

“ Moon argues that this false source allegation is legally insufficient.
[3] The first argument proffered by Moon is that the statement amounted only to an explanation of the absence of an attached W-2 form, not a representation that the Unification Church was the source of the income reported on line 9. [FN7] This is untenable. A W-2 form indicates the amount of income received from a particular source, and it is prepared by the organization or individual that is the source of the income. ”

“ This is a case where evidence concerning the nature of the RICO enterprise also served to prove the existence of a pattern of racketeering activity. Facts external to the predicate acts--the three murders--were essential to prove relatedness and the threat of continuity. [Defendant] committed murders which were critical to the [Commission of La Cosa Nostra's] achieving its goal of resolving family leadership disputes; these were not "isolated acts of racketeering activity." ”

“ Reliance on Levy is misplaced, however, because it does not stand for the proposition that one can be prosecuted under section 7206 (1) only if the false statement was made in response to a question specifically authorized by the Code or Regulations. ”

“ As discussed supra and infra, defendants alleged violation of mail fraud, wire fraud and obstruction of justice statutes was part of an allegedly intricately interrelated set of actions whose common objective was to discredit plaintiffs' theories. Economic motivation as to any of the predicate acts is absent. ”

“ United States v. Ferguson, 758 F.2d 843 (2d Cir.) , cert. denied, 474 U.S. 841 (1985) , plaintiffs' RICO allegations cannot stand. As developed in Ivic and Bagaric, the "enterprise" requirement should be read in conjunction with §§ 1962 (a) and (b) , which leads to the conclusion that when neither the enterprise nor the racketeering acts are economically motivated, there can be no RICO violation. ”

“ Several defendants, Malony, Anthony, Richardson, Stark and London, allegedly used the conspiracy as a means for financial gain. (Am.Compl. ¶ 4.) Over a seven year period, defendants allegedly conspired to attempt to obstruct justice in several court proceedings by improperly influencing those proceedings, obstructing justice, deceiving judges, committing wire, mail and common law fraud, acting negligently, and defaming plaintiffs so as to foreseeably injure them. ”

“ Due to DIMPAC's existence, Goodstein, Fowler and EF & B concealed information regarding the Molko brief in soliciting the APA Executive Council's approval of the brief. Defendants allegedly failed to make clear the nature and purpose of the filing and that the defendants were seeking a ruling by the court as to the lack of scientific acceptance of Singer's proposed testimony on coercive persuasion. (Id. at ¶ 69.) Goodstein concealed that he was on Lifespring, Inc.'s National Advisory Board. ”

“ Letters to D'Antonio against Ofshe and in furtherance of the conspiracy against Singer and Ofshe were received from Richardson, Malony and Stark. (Id. at ¶¶ 162-167.) In August 1989, the ASA withdrew its appearance as amicus, allegedly misrepresenting to the Court its reasons for doing so when it stated that it withdrew for reasons of internal procedure. (Id. at ¶ 196, 198-200.) ”

“ In fact, the members of this alleged enterprise sometimes defrauded other members and sometimes frustrated the enterprise's objective, such as when the APA dismissed Malony's ethics complaint against Singer. ↑ FN3. These paragraphs read:
1. Plaintiffs individually and jointly contend that the defendants individually, jointly and in various combinations acted and conspired to defame and destroy [plaintiffs'] reputations as professionals and their reputations as forensic experts in the areas of psychology and sociology synonymously described as thought reform or coercive persuasion. ”

“ In this Court's view, the superior basis for doing so--in essence, going to the heart of the problem of plaintiffs' attempt to bring their claims under RICO-- was mentioned by defendants only in a footnote of their Reply Brief. (See Defs.' Reply at 17 n. 6.) On the basis of a line of Second Circuit cases beginning with United States v. Ivic, 700 F.2d 51 (2d Cir.1983) , and United States v. Bagaric, 706 F.2d 42 (2d Cir.) , cert. denied, 464 U.S. 840 (1983) , and still followed by this and other circuits, see e.g., National Organization for Women v. ”