RSM Production Corp. v. Freshfields Bruckhaus Deringer U.S. LLP

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 10, 2012 Decided June 22, 2012
No. 11-7101
RSM PRODUCTION CORPORATION,
APPELLANT
v.
FRESHFIELDS BRUCKHAUS DERINGER US LLP, ET AL.,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 1:10-cv-00457)
Daniel L. Abrams argued the cause for appellant. With him
on the briefs was Kelly Hebron.
David W. Ogden argued the cause for appellees. With him
on the brief were Andrew B. Weissman, Joshua M. Salzman, and
Christina Manfredi McKinley.
Before: ROGERS and BROWN, Circuit Judges, and
RANDOLPH, Senior Circuit Judge.
Opinion for the Court by Circuit Judge ROGERS.
2
ROGERS, Circuit Judge: RSM Production Corporation
(“RSM”) appeals the dismissal of its complaint, pursuant to
Federal Rule of Civil Procedure 12(b)(6), against the law firm
Freshfields Bruckhaus Deringer U.S. LLP, and two of its
partners, Jan Paulsson and Brian King (hereinafter
“Freshfields”). RSM alleged that Freshfields, through its
representation of the nation of Grenada in international
arbitration, conspired to violate the Racketeer Influenced and
Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962(d), in an
effort to prevent RSM from obtaining an exclusive license for
offshore oil and gas exploration and development in Grenada.
See 18 U.S.C. § 1964(c).1 The district court ruled that RSM’s
lawsuit was barred under the doctrine of res judicata because of
its prior lawsuit in the Southern District of New York regarding
the same licensing effort. On appeal, RSM contends Freshfields
was not in privity with the New York defendants and that RSM
was not required to add Freshfields as a party to that litigation
on pain of res judicata. Freshfields challenges those arguments
and presents alternative grounds for affirmance, upon de novo
review, which RSM maintains lack merit. We affirm on the
alternative ground that RSM’s complaint failed to state a claim
of RICO conspiracy against Freshfields.2
1
18 U.S.C. § 1964(c) provides, in relevant part:
Any person injured in his business or property by reason of a
violation of [18 U.S.C.] section 1962 . . . may sue therefor in
any appropriate United States district court and shall recover
threefold the damages he sustains and the cost of the suit,
including a reasonable attorney’s fee . . . .
2
RSM’s suggestion that the court should not reach this
question because there was a pending motion to amend the complaint
at the time of its dismissal, see Reply Br. at 15, lacks merit. RSM
neither exercised its authority to amend its complaint as of right
pursuant to Federal Rule of Civil Procedure 15(a)(1), nor filed “[a]
3
I.
Treating the allegations in the complaint as true, as required
upon review of a motion to dismiss, see Atherton v. Dist. of
Columbia Office of the Mayor, 567 F.3d 672, 677 (D.C. Cir.
2009), shows the following:
- In 1996, RSM, a Texas corporation whose chief executive
officer is Jack Grynberg, entered into an exclusive agreement
with the nation of Grenada that “was to have resulted in an oil
and natural gas hydrocarbon exploration, development and
production license being issued as a matter of routine
performance by Grenada to RSM.” Compl. ¶ 10. The
agreement provided that the license application was to be filed
within ninety days of the agreement’s execution, subject, as
relevant, to a force majeure clause. See Agreement Between the
Gov’t of Grenada & RSM Prod. Corp. (“Agreement”), arts. 3.1,
24, Ex. A to Compl.
- A few months after the Agreement was executed, Gregory
Bowen, then Deputy Prime Minister and Minster of Energy of
Grenada, Compl. ¶ 5, told Grynberg that “he expected
significant bribe payments from RSM and Grynberg in order for
RSM and Grynberg to do business in Grenada,” id. ¶ 12. RSM
motion for leave to file an amended [complaint] . . . accompanied by
an original of the proposed pleading as amended,” D.C. DIST. CT.
LOCAL CIV. R. 7(i). A “bare request in an opposition to a motion to
dismiss” is insufficient. Confederate Mem’l Ass’n, Inc. v. Hines, 995
F.2d 295, 299 (D.C. Cir. 1993). Therefore, at the time of dismissal,
RSM had no basis for calling upon the district court’s discretion under
Rule 15(a)(2). Furthermore, this court may affirm a district court on
grounds other than those found by the district court. See Kaemmerling
v. Lappin, 553 F.3d 669, 676 (D.C. Cir. 2008); Razzoli v. Fed. Bureau
of Prisons, 230 F.3d 371, 376 (D.C. Cir. 2000). See further Novak v.
World Bank, 703 F.2d 1305, 1309 n.11 (D.C. Cir. 1983).
4
and Grynberg refused to pay, and Bowen thereafter “obstructed,
harassed and intimidated RSM and Grynberg in their efforts to
explore, develop and produce Grenada’s vast oil and natural gas
resources.” Id.
- Also shortly after the Agreement was executed, RSM,
with Grenada’s consent, invoked the force majeure clause in
view of ongoing boundary-water disputes between Grenada and
some of its neighbors. Id. ¶ 18. Over the course of the next
eight years, RSM made substantial expenditures to collect
exploration data in reliance on the exclusive licensing
Agreement. Id. ¶ 19. Also during this time, Lev Model formed
Global Petroleum Group, a Grenadian company, in December
2003, to “acquire rights to explore, develop and produce the
Grenadian offshore areas believed to contain . . . vast[
]recoverable reserves of petroleum.” Id. ¶¶ 14, 17. Model and
his company acted as agents for others to bribe Grenadian
officials in order to acquire these offshore rights. Id. ¶ 17.
Then, in January 2004, RSM informed Grenada “that sufficient
progress had been made [in resolving the boundary disputes] to
allow it to proceed and that it was in the process of revoking the
force majeure.” Id. ¶ 20.
- On April 14, 2004, RSM submitted its license application
to Grenada. Id. ¶ 21. Initially Grenada raised “frivolous
concerns” about the lack of financial assurances. Id. ¶ 22.
Earlier that year a Grenadian official, who reported to Bowen,
had informed Global Petroleum’s directors (including Model)
“that Grenada was ‘in a situation’ with RSM” and “not in a
position to enter any agreements concerning [its] offshore
petroleum assets until the ‘situation’ with RSM was resolved.”
Id. ¶ 23. By letter of April 27, 2004, Bowen advised RSM that
its license application was untimely, id., which RSM disputed,
id. ¶¶ 24, 29. Bowen rejected RSM’s efforts to settle the dispute
amicably. Id. ¶¶ 25–27.
5
- On or about August 31, 2004, RSM invoked Article 26 of
the Agreement by filing a request for arbitration with the
International Centre for the Settlement of Investment Disputes
(“the ICSID”). Id. ¶ 29. Grenada engaged Freshfields as its
arbitration counsel. Id. ¶ 13. Global Petroleum and Model (and
affiliated entities) paid the legal costs of Grenada’s arbitration,
which amounted to millions of dollars. Id. ¶¶ 44–46. In 2009,
an ICSID panel ruled that RSM’s license submission had been
untimely, and RSM appealed. Id. ¶ 29.3
Meanwhile, on October 31, 2006, RSM sued Global
Petroleum, Model, Bowen, and others (including BP, p.l.c. and
TNK-BP Ltd., but not Freshfields) in the Southern District of
New York, alleging tortious interference with contract and with
prospective business advantages and civil conspiracy to commit
tortious interference. While that case was pending, and just
prior to national elections in July 2008, Grenada granted the
exploration and development license to Global Petroleum. Id.
¶ 49. The New York complaint was dismissed in 2009, pursuant
to Federal Rule of Civil Procedure 12(b)(2) and (6), and the
dismissal was affirmed on appeal. RSM Prod. Corp. v. Fridman,
3
On March 13, 2009, the ICSID arbitration panel found that
Grenada had not breached its contractual obligation to grant a license
to RSM because the Agreement had either lapsed on March 28, 2004,
when the ninety-day period in Article 3.1 expired and RSM had failed
to apply for a license, or terminated upon RSM’s receipt of a July 5,
2005 letter from the chief legal officer in the Government of Grenada
referencing RSM’s breach by untimely filing and stating that in view
of RSM’s filing for arbitration, “there is no realistic prospect of an
amicable resolution” under Article 26.1. See ICSID Arbitration
Award at ¶¶ 207, 393, 503, Ex. A to Defs.’ Mot. to Dismiss Pl.’s
Compl. On April 28, 2011, an ICSID review committee discontinued
the appellate proceedings and ordered RSM to pay Grenada’s
appellate costs. ICSID Annulment Proceeding at 20, Ex. A to Defs.’
Notice of Supplemental Authority.
6
643 F. Supp. 2d 382, 390 (S.D.N.Y. 2009), aff’d, 387 F. App’x
72, 75 (2d Cir. 2010) (unpublished).
Prior to the affirmance, RSM filed the current complaint
against Freshfields on March 17, 2010, alleging it was part of
a conspiracy to bribe Grenadian officials and deny RSM its
offshore licensing rights. Specifically, Freshfields “knowingly
agreed to perform services of a kind which have facilitated the
activities of those who are operating the Enterprise . . . in an
illegal manner.” Compl. ¶ 56. The Enterprise consisted of
Global Petroleum, Model, Bowen, and others who were
associated “for the common purpose of enriching Bowen and
other high-level Grenadian officials” by “obtaining rights to
receive an exclusive [offshore] exploration license” in Grenada,
and “defeat[ing] RSM’s claim to the very same, exclusive
exploration license.” Id. ¶ 57. The conspiracy had a secondary
aim of “conceal[ing] the scheme, since it was and is necessary
to avoid detection in order to secure and later retain the license.”
Id. Freshfields, in turn, “by knowingly participating in and
benefi[t]ting from the legal fees arising out of the conspiracy,
. . . participated in and benefitted from a racketeering
enterprise.” Id. ¶ 62. RSM sought damages in excess of $500
million, costs, attorney’s fees, and threefold damages.
Freshfields moved to dismiss the complaint pursuant to
Federal Rule of Civil Procedure 12(b)(1) and (6), on four
independent grounds: res judicata; immunity under the ICSID
Convention, arts. 21, 22, opened for signature Mar. 18, 1965, 17
U.S.T. 1270, T.I.A.S. No. 6090 (entered into force Oct. 14,
1966); statute of limitations; and, failure to allege facts
sufficient to state a RICO claim. The district court dismissed the
complaint as barred by res judicata in view of the New York
lawsuit. RSM Prod. Corp. v. Freshfields Bruckhaus Deringer
U.S. LLP, 800 F. Supp. 2d 182, 194 (D.D.C. 2011). RSM
appeals, and our review of the dismissal is de novo, see Jones v.
7
Horne, 634 F.3d 588, 595 (D.C. Cir. 2011); Atherton, 567 F.3d
at 681; Ibrahim v. Dist. of Columbia, 463 F.3d 3, 7 (D.C. Cir.
2006).
II.
18 U.S.C. § 1962(d) provides that it is “unlawful for any
person to conspire” to violate a substantive RICO provision.
See Compl. ¶ 56. To state a § 1962(d) conspiracy, the complaint
must allege that (1) two or more people agreed to commit a
subsection (c)4 offense, and (2) a defendant agreed to further that
endeavor. See Salinas v. United States, 522 U.S. 52, 65 (1997).
A defendant need not agree to be the one to commit the
predicate acts. See id. at 65–66 (citing ALI MODEL PENAL
CODE). Nor must a defendant “participate in the operation or
management of [the] enterprise in order to be liable for
conspiracy.” United States v. Wilson, 605 F.3d 985, 1019 (D.C.
Cir. 2010). “[I]t suffices that [the defendant] adopt the goal of
furthering or facilitating the criminal endeavor.” Salinas, 522
U.S. at 65; see also Brouwer v. Raffensperger, Hughes & Co.,
199 F.3d 961, 967 (7th Cir. 2000). Salinas is illustrative. That
case involved a scheme in which a federal prisoner housed in a
county jail paid the sheriff a fixed monthly rate ($6,000) and a
per visit fee ($1,000) for “contact visits” in which he was left
4
18 U.S.C. § 1962(c) provides that it is:
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 or indirectly, in the conduct of such enterprise’s
affairs through a pattern of racketeering activity or collection
of unlawful debt.
18 U.S.C. § 1962(c). See Reves v. Ernst & Young, 507 U.S. 170, 185
(1993); Compl. ¶¶ 57–59.
8
alone with certain women. 522 U.S. at 55. When the sheriff
was unavailable, Salinas, “the chief deputy responsible for
managing the jail and supervising custody of the prisoners,”
arranged for the “contact visits” to continue; in return he
received “a pair of designer watches and a pickup truck,” id.,
thereby demonstrating “that Salinas knew about and agreed to
facilitate the scheme,” which was sufficient to convict under
§ 1962(d), id. at 66.
“To survive a motion to dismiss, [RSM’s] complaint must
contain sufficient factual matter, accepted as true, to ‘state a
claim to relief [under § 1962(d)] that is plausible on its face.’ ”
Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The facts alleged
must “allow[] the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Id. “[F]acts that
are ‘merely consistent with’ a defendant’s liability” and
demonstrate only a possibility, but not the plausibility, of relief
fail to satisfy this standard. Id. RSM’s allegations of
Freshfields’ alleged conspiratorial RICO conduct fall short of
this standard. The complaint alleges essentially six facts
regarding Freshfields’ knowledge. None individually or taken
together supports a plausible inference that in agreeing to
represent Grenada in international arbitration proceedings,
Freshfields knew of the bribery-racketeering conspiracy and
agreed to foster its goals.
The complaint alleges:
1. Upon agreeing in 2004 to represent Grenada in
international arbitration, Freshfields was on notice that its client
“had a reputation for corruption and bribery.” Compl. ¶ 50.
Such knowledge has no bearing on the contractual defense
presented by Freshfields on behalf of Grenada during the
arbitration proceedings.
9
2. “On information and belief,” another law firm had
declined to represent Grenada after becoming “aware of [the]
fact that either Grenada did not have funds adequate to pay [its]
bills, or that the arbitration was being funded by a corrupt
[e]nterprise,” id. ¶ 30, and “Freshfields was [] aware . . . that
[the other firm] had turned down the representation,” id. ¶ 50.
Another law firm’s decision to decline representation, or a
client’s tainted reputation, is insufficient to show § 1962(d)
liability; any other conclusion would preclude an attorney from
representing a client alleged to have violated RICO without
incurring personal RICO liability even absent evidence of
knowledge of the bribery-racketeering conspiracy or of an
agreement to further a § 1962(c) offense.
3. Freshfields was on notice that Model “was a
convicted felon,” Compl. ¶ 50, and that Model and Global
Petroleum (and affiliated entities) were financing Grenada’s
legal defense at arbitration, id. ¶¶ 44–46, 50. Such general
allegations fall short of supporting a plausible inference that
Freshfields was aware of an ongoing bribery-racketeering
conspiracy between Grenada and Global Petroleum (and its
affiliates) to defeat RSM’s attempt to obtain an offshore license.
To the contrary, such facts are consistent with a normal business
practice in which an interested party — such as Global
Petroleum — funds another entity’s legal representation. The
Model Rules of Professional Conduct indicate that third-party
funding is neither unusual nor per se impermissible, see ABA
MODEL RULES OF PROF’L CONDUCT R. 1.8(f) (2011); D.C. DIST.
CT. LOCAL CIV. R. 83.15(a) (2012), even if the third-party has
a financial interest in the outcome of the litigation, see MODEL
RULES OF PROF’L CONDUCT R. 1.7. RSM cites no authority to
the contrary.
4. Freshfields knew its “retainer was being paid
through [the] corrupt relationship,” Compl. ¶ 50, and violated
10
laws of the nations in which it is located by failing to report its
arbitration-fee income as “corrupt money,” id. ¶ 51. For
example, in the United Kingdom, “as soon as a lawyer . . .
discovers or suspects anything in the proceedings that may
facilitate the acquisition, retention, use or control of ‘criminal
property,’ the lawyer must immediately notify the National
Criminal Intelligence Service of his belief.” Id. The complaint,
however, does not allege that the funds used to pay Freshfields
for its legal services were ill-gotten gains subject to forfeiture or
reporting. See U.S. DEP’T OF JUSTICE, U.S. ATTORNEYS’
MANUAL § 9–120.103 (May 2010).5 Nor does the complaint
identify any “criminal property” in Freshfields’ control or
possession. The court need not accept conclusions of law —
“corrupt money” — as true for purposes of a motion to dismiss.
See Warren v. Dist. of Columbia, 353 F.3d 36, 39 (D.C. Cir.
2004); see also Kirch v. Liberty Media Corp., 449 F.3d 388, 398
(2d Cir. 2006).
5. In 2007, “public reports” confirmed that Model and
another Global Petroleum director had bribed Grenadian
officials, thereby putting Freshfields on notice of the bribery-
racketeering conspiracy. See Compl. ¶ 50.6 This conclusion
5
Available at http://www.justice.gov/usao/eousa/
foia_reading_room/usam/title9/120mcrm.htm (last visited June 11,
2012).
6
The public nature of other “reports” is unclear. The
complaint refers to: (1) a conversation in which a Global Petroleum
director told Grynberg that Global Petroleum “ ‘own[ed]’ the
Government of Grenada,” Compl. ¶ 37; (2) a conversation in which a
Grenadian “Ambassador at Large” informed Grynberg that affiliates
of Global Petroleum had bribed Grenadian officials in order to
“develop the vast petroleum reserves believed to exist in the offshore
Grenadian territory,” id. ¶ 42; and, (3) two declarations dated
November and December 2007 by individuals attesting that agents of
11
assumes facts not alleged. An April 2007 article published by
“Forbes” identified Grenada as “one of the best places for
embezzled money”; a May 2007 “S&P ratings research
comment” mentioned “the ‘widespread perception of corruption
in the higher echelons of power’ in Grenada’s th[e]n-existing
government”; and a sentencing memorandum described “a
Ponzi-scheme run out of a Grenadian [b]ank.” Id. ¶ 34.
Bowen’s June 2007 arbitration testimony acknowledged “that
Global Petroleum and Grenada had entered into” a funding
agreement under which Global Petroleum financed Grenada’s
defense at arbitration. Id. ¶ 44. These allegations are
insufficient to establish a plausible inference that Freshfields
was aware of anything corrupt relevant to its provision of legal
services other than accusations made by and on behalf of Global
Petroleum’s litigation adversary and general reports of public
corruption in Grenada.
6. “[U]pon learning facts suggesting that the source of
its income for legal services was also responsible for bribing
Grenadian officials for the purpose of obtaining lucrative license
rights in Grenada, [Freshfields] could not continue the
representation, since the entire representation was and is adverse
to its client, Grenada.” Id. ¶ 52. Further, “representation in the
face of a transparent conflict of interest is indicative of
[Freshfields’] conscious decision to join the conspiracy, and . . .
facilitate the goals of the [RICO] [e]nterprise . . . and
conspiracy.” Id. “[T]he court is ‘not bound to accept as true a
Global Petroleum bribed Grenadian officials, id. ¶¶ 41, 47. Both
Grynberg conversations and one of the declarations appear to be
public only because RSM referenced the conversations and attached
the declaration to its amended complaint in the New York lawsuit, see
Third Am. Compl. ¶¶ 46, 50, 55, RSM Prod. Corp. v. Fridman (No.
06-cv-11512) (Feb. 25, 2008). No allegation indicates how
Freshfields would have known of the second declaration.
12
legal conclusion couched as a factual allegation.’ ” Mountain
States Legal Found. v. Bush, 306 F.3d 1132, 1137 (D.C. Cir.
2002) (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986));
see also In re NYSE Specialists Sec. Litig., 503 F.3d 89, 95 (2d
Cir. 2007).
Taken together, these allegations fail to establish the
requisite link for § 1962(d) liability between Freshfields and the
bribery-racketeering conspiracy. First, representing Grenada in
arbitration by presenting its defense that RSM’s license
application was untimely under the parties’ Agreement, qua
defense, presents no adversity or conflict of interests as would
either inform Freshfields of the bribery-racketeering conspiracy
or plausibly show its agreement to present a legal defense was
an agreement to further acts of racketeering.
Second, the payment of Freshfields’ legal fees by sources
seeking the valuable Grenadian offshore license is insufficient
to show Freshfields was part of the bribery-racketeering
conspiracy. Even when considered in light of the 2007 reports
about Grenada and alleged legal malpractice by Freshfields, the
source of the fees does not support a plausible inference that
Freshfields “was aware of the essential nature and scope of the
[RICO] enterprise,” Baumer v. Pachl, 8 F.3d 1341, 1346 (9th
Cir. 1993) (quoting United States v. Muskovsky, 863 F.2d 1319,
1324 (7th Cir. 1988)), much less that it “kn[ew] of and agreed
to the overall objective of the RICO offense,” United States v.
Delgado, 401 F.3d 290, 296 (5th Cir. 2005). The chronology
works against RSM. According to the complaint, Freshfields
did not begin its representation of Grenada until well after
Grenada had denied RSM’s license application as untimely and
RSM had filed for arbitration. Grenada, represented by
Freshfields, defended the denial in the arbitration. Given the
success of this defense and its seemingly innocuous, contractual
nature, see Compl. ¶ 29; ICSID Arbitration Award at ¶¶ 342–95,
13
it is implausible to infer that the 2007 reports would have alerted
Freshfields to a bribery-racketeering conspiracy to deny RSM’s
license application three years earlier. A more plausible
inference is that Freshfields would have suspected that the
alleged bribes were made in an effort to secure future licensing
rights, not to prompt Grenada’s contractually-based denial of
RSM’s license application. That Freshfields continued to
represent Grenada in arbitration after the 2007 publications does
not alter the analysis. Because RSM failed to “nudge[] [its]
claim[]” that Freshfields knew of the RICO conspiracy or any
pattern of racketeering activity “across the line from conceivable
to plausible,” its “complaint must be dismissed,” Twombly, 550
U.S. at 570. See also Iqbal, 129 S. Ct. at 1951; Baumer, 8 F.3d
at 1346.
Third, the allegations fail to support a plausible inference
that Freshfields agreed to join or acted to foster the bribery-
racketeering conspiracy. The complaint does not allege that
Freshfields itself committed any of the predicate acts. See
Compl. ¶¶ 58, 62. Rather, the complaint alleges that Freshfields,
“by knowingly participating in and benefit[t]ing from the legal
fees arising out of the conspiracy, . . . participated in and
benefitted from a racketeering enterprise,” id. ¶ 62. In other
words, to support the necessary inference that Freshfields agreed
to further the conspiracy, RSM relies solely on the allegations
regarding Freshfields’ knowledge of the bribery-racketeering
conspiracy and its legal representation of Grenada and payment
therefor. Although alleged co-conspirators (i.e., Global
Petroleum and Model) provided the funding for Grenada’s
arbitration defense, it is implausible to infer that therefore
Freshfields’ provision of legal services at arbitration was
intended to further the criminal endeavor. To the contrary,
Freshfields’ representation of Grenada in the international
arbitration proceedings is “more likely explained by,” Iqbal, 129
14
S. Ct. at 1950, its normal business practice of providing legal
services for and representing clients in arbitration.
In sum, the allegations of the complaint target Freshfields’
services as attorneys, nothing more. As such, Freshfields’
conduct in representing Grenada at arbitration is readily
distinguishable from instances in which attorneys have been
held liable under RICO § 1962(c) and (d) for performing, under
the guise of providing legal services, illegal acts, such as
devising a fraudulent scheme to manipulate the bankruptcy
process, see Handeen v. Lemaire, 112 F.3d 1339, 1350–51 (8th
Cir. 1997), or facilitating illegal investments, see United States
v. Loften, 518 F. Supp. 839, 854 (S.D.N.Y. 1981).7 Unlike in
Salinas, 522 U.S. at 66, on which RSM relies, the complaint
alleges no conduct by Freshfields beyond the provision of
normal legal services in arbitration and so fails to support a
reasonable inference that Freshfields “agree[d] to assist others
in the commission of unlawful acts,” Reply Br. at 24. As
explained in Twombly, allegations that a defendant acted in ways
consistent with a conspiratorial agreement, but also equally well
7
The circuit courts of appeals have declined to extend RICO
liability under § 1962(c) to an attorney’s provision of routine legal
services. See Walter v. Drayson, 538 F.3d 1244, 1248–49 (9th Cir.
2008); Handeen, 112 F.3d at 1348–49 (8th Cir.); Azrielli v. Cohen
Law Offices, 21 F.3d 512, 521 (2d Cir. 1994); Baumer, 8 F.3d at 1344
(9th Cir.); Nolte v. Pearson, 994 F.2d 1311, 1317 (8th Cir. 1993); cf.
Reves, 507 U.S. at 182–83, 185–86. The Eighth Circuit observed in
Handeen that although “[a]n attorney’s license is not an invitation to
engage in racketeering” and neither Reves nor the RICO statute
exempts professionals as a class, “[i]t is a good thing, we are sure, that
we find it extremely difficult to fathom any scenario in which an
attorney might expose himself to RICO liability by offering
conventional advice to a client or performing ordinary legal tasks (that
is, by acting like an attorney).” Handeen, 112 F.3d at 1349.
15
explained by legitimate economic incentives, do “not suffice . . .
to show illegality.” 550 U.S. at 556–57; see also id. at 554. So
too, unsupported conclusory allegations are “not entitled to be
assumed true,” Iqbal, 129 S. Ct. at 1951, and dismissal is proper
when a conspiracy allegation “d[oes] not plausibly suggest an
illicit accord because it [i]s not only compatible with, but indeed
[i]s more likely explained by, lawful, unchoreographed free-
market behavior,” id. at 1950; see also Am. Dental Ass’n v.
Cigna Corp., 605 F.3d 1283, 1295 (11th Cir. 2010).
Accordingly, because RSM failed to allege facts sufficient
to support a plausible inference that Freshfields knew of and
agreed to further the bribery-racketeering conspiracy, the
complaint fails to state a claim against Freshfields for RICO
civil conspiracy under § 1962(d) and was properly dismissed
pursuant to Rule 12(b)(6), and we affirm.