Handeen v. LeMaire: Attorneys Crossing the Line into the Operation or Management of a RICO Enterprise
![handle is hein.journals/umkc67 and id is 199 raw text is: HANDEEN v. LEMAIRE: ATTORNEYS CROSSING
THE LINE INTO THE OPERATION OR
MANAGEMENT OF A RICO ENTERPRISE
. Shawn E. Stewart*
I. INTRODUCTION
The role of an attorney can be seen as the planner, creator, and organizer of
ideas and schemes that may suit a client's needs. Clients often look to an attorney
for not only legal advice and opinion, but for conventional ingenuity in finding
solutions and answers to their problems. Attorneys are generally placed in a
position in which they take the lead and make decisions for clients, often playing
an important managerial role in their clients' personal and business affairs. This is
not an unknown concept to lawyers or to the common lay person, nor does it appear
alarming to most people that attorneys play the role of director or controller of the
clients' corporation, organization, or even personal affairs.
However, the Eighth Circuit's decision in Handeen v. Lemaire leads one to
believe that the attorney does not assume this role, but is merely one who offers
conventional advice to a client or perform[s] ordinary legal tasks (that is, by acting
like an attorney).' The holding in Handeen, that an attorney participated in the
operation or management of a Racketeer Influenced and Corrupt Organizations Act
(RICO) enterprise, exposes attorneys to criminal penalties and civil actions for
treble damages.2 The Eighth Circuit held an attorney liable when the RICO
enterprise relied upon the Firm, with its legal acuity, to take the lead in making
important decisions concerning the operation of the enterprise.3 This standard is
problematic for not only bankruptcy attorneys, but for the entire legal profession,
because it gives attorneys no guidance as to how they should limit their roles in
client activities, if at all.4
Section 1962(c) of RICO makes it unlawful for any person ... associated
with any enterprise . . . to conduct or participate, directly or indirectly, in the
conduct of such enterprise's affairs through a pattern of racketeering activity.5 The
Eighth Circuit addressed the nature of the participation required of a RICO
defendant before liability is appropriate'6 in Bennett v. Berg, by holding that [a]
defendant's participation must be in the conduct of the affairs of a RICO enterprise,
* J.D. Candidate 1999, University of Missouri - Kansas City School of Law; B.A. Central
College, 1996; Recipient of the Marvin and Patricia Rich Corporation Law Prize, 1998. The author
wishes to express his sincere appreciation to Professor Ed Richards for his advice and guidance
throughout the writing of this Note.
1. Handeen v. Lemaire, 112 F.3d 1339, 1349 (8th Cir. 1997).
2. See 18 U.S.C. §1963 (1994) (criminal penalties); 18 U.S.C. §1964(c) (1994) (treble damages
and attorney's fees).
3. Handeen, 112 F.3d at 1350.
4. Jeffrey N. Shapiro, Attorney Liability Under Rico §1962(c) After Reves v. Ernst & Young,
61 U. CHI. L. REV. 1153, 1166 (1994).
5. 18 U.S.C. § 1962(c) (1994).
6. Young v. Reves, 937 F.2d 1310, 1324 (8th Cir. 1991).](ViewImageLocal?handle=hein.journals/umkc67&div=16&collection=&method=preview&ext=.png&size=3)
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Handeen v. LeMaire: Attorneys Crossing the Line into the Operation or Management of a RICO Enterprise
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