UAE, the Muslim Brotherhood, RICO, and Defamation

From Nada v. United Arab Emirates, decided by Judge Amy Berman Jackson (D.D.C.) today:

Plaintiffs Hazim Nada and his privately owned oil company, Lord Energy SA (“Lord Energy”), brought this action seeking more than a billion dollars in damages from a number of defendants, including the United Arab Emirates (“UAE”), a Swiss investigative firm and its founders and employees, a Swiss journalist, and an American academic.

They allege that defendants conspired to eliminate Lord Energy as a competitor to the UAE’s state-owned oil company in the spot market for light crude oil exported to Asia. Plaintiffs claim that the alleged association of individuals and entities, which they refer to as an “enterprise” as that term is defined by the Racketeer Influenced and Corrupt Organizations (“RICO”) Act, 18 U.S.C. § 1962(c), “managed, directed, and bankrolled a years-long ‘dark’ public relations campaign” in which they falsely linked Lord Energy to the Muslim Brotherhood and other terrorist organizations, including al-Qaeda.

As a result, plaintiffs claim, financial institutions refused to lend them money, and Lord Energy and its U.S. subsidiary, Americas Lord Energy, went bankrupt. They filed the lawsuit to recover damages for the economic harm that the alleged campaign caused to their business and reputations….

[T]he Court will GRANT the UAE’s motion to dismiss for lack of subject matter jurisdiction since the UAE is immune from suit in the United States under the Foreign Sovereign Immunities Act, and no statutory exception applies; it will GRANT the Alp defendants’ and Besson’s motions to dismiss for lack of personal jurisdiction; and it will GRANT Vidino’s motion to dismiss because the sole count against him fails to state a claim that he joined the alleged conspiracy. Given those rulings, the Court need not take up the merits of the extravagant and problematical claims brought under the Lanham Act, RICO, and the Sherman Act.

The Court finds that notwithstanding its length and unnecessary detail, the amended complaint is nothing more than a defamation case in search of a legal theory.

It is also an action in search of a basis to require a foreign sovereign and other foreign entities and individuals to defend themselves in the United States. There are no allegations of commercial activity in the United States or commercial acts in the United States in support of commercial activity abroad, and to the extent plaintiffs suggest that defendants’ activities abroad were directed at the United States, the complaint does not allege any direct effect in the United States which forms the gravamen of any claim.

As for the one individual based in the United States, the allegations against him fail to state a claim. Nothing in this opinion is meant to suggest, though, that the knowing dissemination of false accusations of connections to the Muslim Brotherhood or other terrorist organizations could not cause real harm or that would be is an appropriate tactic….

Here’s the court’s discussion of the one American defendant over whom there is personal jurisdiction, George Washington University Prof. Lorenzo Vidino:

Defendant Vidino, the American journalist {[and] academic expert [on] the Muslim Brotherhood} …, is charged in only one count: Count Three, which alleges that all of the defendants conspired to violate the Racketeer Influenced and Corrupt Organizations Act, or RICO. Putting aside defendants’ arguments that both the conspiracy and substantive RICO claims should be dismissed because at bottom, this is a defamation case, and plaintiffs have not alleged the necessary predicate criminal acts to invoke RICO, the Court finds that the complaint does not include facts to give rise to a plausible inference that Vidino was a member of whatever alleged conspiracy there may have been. {This means that the Court need not reach Vidino’s objection to the claim on First Amendment grounds.}

Section 1962(d) of the RICO statute, 18 U.S.C. § 1962(d), provides that it is “unlawful for any person to conspire to violate” a substantive RICO provision…. “[T]he complaint must allege that (1) two or more people agreed to commit a [RICO] subsection (c) offense, and (2) a defendant agreed to further that endeavor.” A defendant does not have to agree to be the one who commits the predicate acts, and his liability does not depend on his personal participation in the operation of management of the alleged enterprise. But the complaint must include facts to support a finding that the defendant himself “adopt[ed] the goal of furthering or facilitating the criminal endeavor.”

The complaint here contains nothing of the sort. In their opposition to the motion to dismiss, plaintiffs point to paragraph 40 of the amended complaint, but it says nothing about Vidino’s knowing agreement to pursue the alleged co-conspirators’ unlawful goal.

Vidino was hired by Alp as a contractor to provide leads on new targets and research and analysis on the Muslim Brotherhood. Alp routinely directed Vidino to obtain information it could then use in connection with its viral communication campaigns. He typically was paid between $2,000–$4,000 for each discreet assignment he completed for Alp. Vidino routinely communicated with Brero, Badal, and another Alp employee via WhatsApp….

The enterprise also funneled information to Vidino and relied on him, and his academic credentials, to legitimize the false and misleading statements the enterprise published to discredit, disparage, and destroy its targets…. When Alp uncovered Facebook posts, it passed them on to Vidino and told the UAE that Alp ‘channeled our findings to the academic expert Lorenzo Vidino,’ who shared them with a journalist at The Times. Alp noted that using Vidino as an intermediary ensured that Alp would remain ‘completely confidential.’

See also Am Compl. ¶ 126 (alleging Badal and Brero “intended to use Vidino as an American analogue to Besson—a credible and highly-credentialed intermediary who was willing to say whatever they wanted in exchange for money”); ¶ 129 (“On January 24, 2018, Vidino signed a contract with Alp to provide ‘[i]nteresting leads/rumours regarding the subject of investigation organisations/individuals/funding in Europe’ and a ‘[l]ist of alleged members of the first tier organisations in European countries.’ Alp agreed to pay Vidino 3,000 Euros for this work.”); ¶ 186 (“To add a thin veneer of legitimacy to spurious claims, [Alp’s] Wikipedia entries quoted Lorenzo Vidino.”); ¶ 281 (quoting an article that appeared in the German newspaper Der Spiegel in 2023 reporting that “[a]n Italian American scholar named Lorenzo Vidino played an important role in the campaign … Since 2018, he has repeatedly performed work for Alp Services ….”). Even if one reads these factual assertions in the light most favorable to the plaintiffs, they may say something about Alp’s state of mind, but they do not reveal anything about Vidino’s.

Plaintiffs’ opposition maintains that Vidino “met with Alp employees on multiple occasions, including at a lavish dinner in Geneva in January 2018,” and “routinely exchanged WhatsApp messages with Brero, Badal, and another Alp employee,” and that “the volume and frequency of Vidino’s communications with Alp evince a closeness that provides evidence of Vidino’s agreement to further the enterprise’s racketeering activities.”

But plaintiffs’ rhetoric is not supported by their own complaint, even as it has been amended. There are allegations about exactly one meeting, the dinner, and the allegedly “routine” WhatsApp communications are not quoted in any other paragraph of the complaint. This is not enough to add up to knowing consent to advance the goals of the alleged co-conspirators. Vidino’s alleged expression in a WhatsApp message after the fact of “his belief that Credit Suisse withdrew its line of credit to Lord Energy because of an article the enterprise had published” does not serve that purpose either.

Nor does the complaint supply facts to support an inference that Vidino knew that the point of his work for Alp was to advance the goals of the UAE. The best plaintiffs could come up was a statement Vidino made after the fact to the author of an article in The New Yorker in 2024 that the UAE was the most “realistic client,” and that quotation lifted his words out of context….