WASHINGTON, DC -- The U.S. Supreme Court yesterday turned down an opportunity to address the alleged overuse of federal anti-mafia statutes in civil suits against large corporations.
The USSC's refusal allows a class action suit against Microsoft and a Best Buy unit, approved by the U.S. Ninth Circuit Court of Appeals, to proceed. The suit, Microsoft Corp. v. Odom (# 07-138), claims a joint venture between the two companies violated the Racketeer Influenced and Corrupt Organizations (RICO) Act.
Business groups oppose the growing use of RICO breaches in civil suits. The U.S. Chamber of Commerce's National Chamber Litigation Center (NCLC) filed a friend-of-the-court brief in the case early last month asking the Justices to review whether laws aimed at organized crime were appropriate tools in civil actions.
"Courts should prevent RICO from being turned into the litigation equivalent of a thermonuclear device," said NCLC Executive Vice President Robin Conrad in a press release early last month.
"This case threatens to dramatically expand RICO liability for corporations that must rely more than ever on joint ventures to remain competitive," she added.
California resident James Odom originally sued the two for a mutual marketing agreement where Microsoft promoted Best Buy stores online in return for Best Buy employees distributing MSN internet software. A similar class action suit is pending in Washington state, reports state.
The NCLC brief also argued that expanding RICO liability in cases like this would "undermine business partnerships and adversely impact the economy."