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Court Cites Discovery Costs in Dismissing RICO Case

In-house counsel tired of settling meritless lawsuits out of fear of huge discovery costs can find hope in a recent ruling from the 7th Circuit.

On April 1, Judge Richard Posner sided with a lower court's ruling in Limestone Development Corp. v. Village of Lemont, Ill., dismissing the case for failure to state a claim and taking the opportunity to make a point about
discovery related to merit challenges.

"Given the respect commanded by Judge Posner individually and by the 7th Circuit collectively, this case has national applicability," Isokawa says. He adds that when it comes to how much discovery will be allowed initially, where the judge draws the line will differ depending on the facts alleged and the discovery sought. "This is a discretionary doctrine, but its mention in Twombly, and now Limestone, shows that courts are aware of the reality of litigation costs," he says.

RICO Reach
The original intent of RICO was to fight organized crime, but according to Jeff Grell, an attorney who has his own RICO practice in St. Paul, Minn., RICO has become popular with civil attorneys because it provides a longer statute of limitations and allows discovery going back as much as 10 years.

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Yesenia Salcedo

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