In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 17‐2324
ARMADA (SINGAPORE) PTE LIMITED,
Plaintiff‐Appellant,
v.
AMCOL INTERNATIONAL CORPORATION,
et al.,
Defendants‐Appellees.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 1:13‐cv‐03455 — Elaine E. Bucklo, Judge.
____________________
ARGUED JANUARY 19, 2018 — DECIDED MARCH 26, 2018
____________________
Before BAUER, MANION, and ROVNER, Circuit Judges.
MANION, Circuit Judge. The plaintiff in this case is a Sin‐
gaporean shipping company. It entered into shipping con‐
tracts with an Indian mining company, but the Indian com‐
pany breached those contracts. Now, the plaintiff believes
that American businesses engaged in racketeering activity to
divest the Indian company of assets so as to thwart the
plaintiff’s attempts to recover damages for the breached con‐
2 No. 17‐2324
tracts. Seeking redress for this alleged wrong, the plaintiff
brought this lawsuit, claiming violations of the Racketeering
Influenced and Corrupt Organizations Act (“RICO”). While
the plaintiff’s case was pending in the district court, the Su‐
preme Court decided RJR Nabisco, Inc. v. European Communi‐
ty, 136 S. Ct. 2090 (2016). Addressing RICO’s extraterritorial
effect, the Supreme Court held that “[a] private RICO plain‐
tiff … must allege and prove a domestic injury to its business
or property.” Id. at 2106. After this decision came down, the
American defendants moved for judgment on the pleadings,
maintaining the plaintiff had not pleaded a domestic injury.
The district court agreed and entered judgment on the RICO
claims against the plaintiff, who now appeals. Because we
also conclude the plaintiff has not pleaded a domestic injury,
we affirm.
I.
As this case comes to us on appeal from judgment on the
pleadings, we present the facts as stated in the plaintiff’s
amended complaint. See Matrix IV, Inc. v. Am. Nat’l Bank and
Trust Co. of Chicago, 649 F.3d 539, 547 (7th Cir. 2011). Amcol
International Corporation, an Illinois corporation with its
principal place of business in Illinois, owns 100% of Ameri‐
can Colloid Company and Volclay International Corporation
(n/k/a Volclay International LLC). Both companies are also
organized under the laws of Illinois with their principal
places of business in Illinois. Given the extent of the three
entities’ affiliation, we will refer to them collectively as
“Amcol.” Amcol was the largest shareholder of Ashapura
Minechem Limited (“Ashapura”), a foreign corporation with
its principal place of business in Mumbai, India.
No. 17‐2324 3
Originally, Ashapura focused its business on the produc‐
tion and marketing of the mineral bentonite. But in 2007 and
early 2008, Ashapura expected to sell large quantities of the
mineral bauxite in China. Needing to get that bauxite to
China, in April 2008 Ashapura entered into two long‐term
contracts of affreightment with Armada (Singapore) PTE
Limited (“Armada”), a foreign corporation with its principal
place of business in the Republic of Singapore. Unfortunate‐
ly, Ashapura encountered problems with its bauxite suppli‐
ers, so it defaulted under the contracts with Armada at the
end of September 2008. Ashapura failed to pay Armada for
the shipment Armada had already carried and did not pro‐
vide any further cargoes.
Armada subsequently initiated two arbitration actions in
London against Ashapura, one for each contract. The arbitra‐
tor found for Armada and awarded more than $70,000,000 in
two awards on February 16, 2010. About a year and a half
later, Armada had the arbitration awards recognized by the
United States District Court for the Southern District of New
York, which entered a judgment for Armada. Armada had
the judgment registered with the United States District
Court for the Northern District of Illinois the next year. In
addition to this activity, Armada sought to collect on its
awards by filing maritime attachment proceedings in New
York and Illinois, naming Amcol as garnishee. Through
these actions, Armada was able to garnish and recover ap‐
proximately $687,000 worth of debts that Amcol owed to
Ashapura.
But Armada thinks Amcol obstructed its attempts to re‐
cover from Ashapura, and this brings us to the crux of the
matter currently before the court. Armada alleges Amcol
4 No. 17‐2324
used its influence as Ashapura’s largest shareholder to en‐
gage in a number of schemes aimed at draining Ashapura of
assets to thwart Armada’s collection efforts. These plots
ranged from routine collection avoidance—such as having
Ashapura file for protection with the Board of Industrial and
Financial Reconstruction in India and file a Chapter 15 bank‐
ruptcy petition in the United States—to more complicated
methods—such as setting off debts owed by Ashapura affili‐
ates against debts Amcol owed to Ashapura.
In 2013, Armada filed this lawsuit against Amcol, Asha‐
pura, and five John Does. In July 2015, Armada filed an
amended complaint setting out state‐law claims for fraudu‐
lent transfer, wrongful dividend, and breach of fiduciary du‐
ties and a claim for maritime fraudulent transfer. Armada
also made two claims pursuant to RICO’s private right of
action,1 alleging Amcol engaged in racketeering activity and
a racketeering conspiracy that harmed Armada’s business or
property.
While the case was pending, the Supreme Court decided
RJR Nabisco and announced a domestic‐injury requirement
for civil RICO cases. Just over a month later, Amcol filed a
motion for judgment on the pleadings. The district court en‐
tered judgment for Amcol on the state‐law claims. The dis‐
trict court also entered judgment on the RICO claims, con‐
cluding that Armada’s claimed injury—harm to its ability to
collect on its judgment and other claims—was economic. Be‐
cause economic injuries are felt at a corporation’s principal
place of business, and Armada’s principal place of business
is in Singapore, Armada had not pleaded a “domestic inju‐
1 See 18 U.S.C. § 1964(c).
No. 17‐2324 5
ry” as required by RJR Nabisco. However, the district court
allowed the maritime fraudulent transfer claim to go for‐
ward, so it denied Amcol’s motion to that extent. Armada
now brings this interlocutory appeal, challenging only the
district court’s ruling concerning the RICO claims.
II.
Our review of the grant of a motion for judgment on the
pleadings is de novo. St. John v. Cach, LLC, 822 F.3d 388, 389
(7th Cir. 2016). The standard for entering judgment on the
pleadings is the same as that for dismissing a complaint for
failure to state a claim: “the complaint must state a claim
that is plausible on its face.” Id. (quoting Vinson v. Vermilion
Cty., Ill., 776 F.3d 924, 928 (7th Cir. 2015)). In this appeal, the
sole issue is whether Armada has pleaded a “domestic inju‐
ry.”
18 U.S.C. § 1964(c), colloquially referred to as “civil
RICO,” empowers private parties to bring lawsuits against
those engaged in racketeering activity when that activity has
caused them harm. See generally Rotella v. Wood, 528 U.S. 549,
557 (2000) (“The object of civil RICO is … not merely to
compensate victims but to turn them into prosecu‐
tors … dedicated to eliminating racketeering activity.”). By
its terms, § 1964(c) requires that the plaintiff have suffered
an injury to “his business or property by reason of” the rack‐
eteering activity. 18 U.S.C. § 1964(c). In this case, Armada
claims that it suffered an injury to its property, namely its
judgment and other claims against Ashapura. Armada
claims that Amcol, by means of racketeering activity, injured
that property by divesting Ashapura of assets, thereby mak‐
ing the judgment and other claims against Ashapura uncol‐
lectable. A cause of action is recognized as a property right
6 No. 17‐2324
that can suffer injury. See Pitts v. Unarco Indus., Inc., 712 F.2d
276, 279 (7th Cir. 1983); cf. Malley‐Duff & Assocs., Inc. v.
Crown Life Ins. Co., 792 F.2d 341, 354 (3d Cir. 1986) (recogniz‐
ing that an injury to a cause of action can be a “business inju‐
ry” for RICO purposes). For Armada, so far so good.
But we do not ask only whether Armada has pleaded an
injury. We also must determine, in light of RJR Nabisco,
whether that injury is “domestic.” Regrettably, the Supreme
Court did not have occasion to elaborate on what it meant in
RJR Nabisco by “domestic injury,” as the plaintiffs in that
case had specifically waived their claims for domestic inju‐
ries. See 136 S. Ct. at 2111. But the Court did provide some
vague hints at what “domestic injury” might entail. For in‐
stance, it consistently referred to the location where an inju‐
ry was suffered. See, e.g., id. at 2108 (“Nothing in § 1964(c)
provides a clear indication that Congress intended to create
a private right of action for injuries suffered outside of the
United States.”); id. at 2111 (directing the dismissal of the
remaining claims because they “rest entirely on injury suf‐
fered abroad”). It also made a point of noting the domestic‐
injury requirement does not categorically bar foreigners
from recovering under the statute’s provisions. See id. at 2110
n.12.
Having announced the domestic‐injury requirement, but
having declined to define the term, the Court cautioned that
“application of this rule in any given case will not always be
self‐evident, as disputes may arise as to whether a particular
injury is ‘foreign’ or ‘domestic.’” Id. at 2111. Unsurprisingly,
that statement has proved prescient. Since RJR Nabisco came
down, many district courts have done their best to craft a
rule for determining which injuries are domestic and which
No. 17‐2324 7
are foreign. See, e.g., Cevdet Aksüt Oğullari Koll. Sti v. Cavuso‐
glu, 245 F. Supp. 3d 650, 657 (D.N.J. 2017) (“These cases ex‐
hibit a wide array of factual scenarios and justifiable reason‐
ing, with no clear victor in the ‘domestic injury’ debate.”).
These cases have only now begun percolating up to the
courts of appeals.
In October of last year, the Second Circuit became the
first court of appeals to address the “domestic injury” issue.
In Bascuñán v. Elsaca, 874 F.3d 806 (2d Cir. 2017), the plaintiff,
a resident of Chile, alleged that his cousin had stolen mil‐
lions of dollars from him through various schemes. Id. at
809. The district court in that case, applying similar reason‐
ing to the district court in this case, concluded that all of the
plaintiff’s injuries were economic, that economic injuries are
suffered at a person’s residence, and thus the injuries were
Chilean, not domestic. Id.
On appeal, the Second Circuit rejected such a one‐
dimensional approach, noting that RICO’s requirement that
injury must be to business or property means all RICO
claims are by nature based on “economic” injury. See id. at
817. In its place, the Second Circuit adopted an approach
that addresses each individual injury alleged. Id. at 818. The
court considered the four injuries pleaded by the plaintiff:
the theft of dividends paid by a foreign corporation, the fun‐
neling of money into a private investment fund in Chile, the
theft of money from a New York bank account, and the theft
of physical bearer shares from a safe‐deposit box in New
York. Id. at 811–13. Concerning the theft of the dividends
and the funneling of money into the investment fund, the
only connection to the United States was that those funds
either passed through or were placed in bank accounts in the
8 No. 17‐2324
United States at some point in the scheme. Id. at 818. The
court concluded that such minimal, defendant‐initiated con‐
tacts with the United States were not sufficient to make the
resulting injuries to the plaintiff “domestic.” Id. On the other
hand, the court held that the alleged theft of the bearer
shares and the theft of the money in the New York bank ac‐
count were “domestic injuries.” Id. at 820. What set these in‐
juries apart was the presence of harm to tangible property
that was located in the United States. Id. at 820–24. The court
held that “where the injury is to tangible property, we con‐
clude that, absent some extraordinary circumstance, the in‐
jury is domestic if the plaintiff’s property was located in the
United States when it was stolen or harmed, even if the
plaintiff himself resides abroad.” Id. at 820–21. Because of
the importance of the presence of tangible property to its
conclusion, the court was quick to distinguish the situations
in the case before it from those involving intangible harms.
See id. at 823–24. For instance, concerning the theft of the
bearer shares, the court pointed out the plaintiff was not al‐
leging any harm to the value of those shares, but rather the
harm caused by the defendant’s theft of the physical shares
themselves. Id. at 824.
Both Armada and Amcol tell us Bascuñán is a win for
them. At oral argument, Armada maintained that its judg‐
ment and claims are tangible properties located in the Unit‐
ed States. For its part, Amcol argued that there is no tangible
property in this case, only “a bundle of litigation rights,” and
that the connections to the United States are too tenuous to
make Armada’s alleged injuries domestic. We agree with
Amcol.
No. 17‐2324 9
To begin with, the property Armada claims Amcol has
harmed is not tangible. A “tangible asset” is one “that has a
physical existence and is capable of being assigned a value.”
Tangible asset, Black’s Law Dictionary (9th ed. 2009). As
much as a judgment or a cause of action is a piece of proper‐
ty, it does not have a “physical existence.” The property at
issue here, then, is an “intangible asset,” which is one that
“can be amortized or converted to cash, such as pa‐
tents, … or a right to something, such as services paid for in
advance.” Intangible asset, Black’s Law Dictionary (9th ed.
2009); see also Blodgett v. Silberman, 277 U.S. 1, 12 (1928) (con‐
cluding that right to receive money was “a chose in action,
and an intangible”).
The Second Circuit’s reasoning in Bascuñán focused on
how to address situations involving tangible property. Here,
we must determine where to locate an injury to intangible
property. As we noted above, the Supreme Court directs us
to focus on where the injury is suffered. To “suffer” is “[t]o
experience or sustain … [an] injury.” Suffer, Black’s Law Dic‐
tionary (9th ed. 2009). It is well understood that a party ex‐
periences or sustains injuries to its intangible property at its
residence, which for a corporation like Armada is its princi‐
pal place of business. See, e.g., Kamel v. Hill‐Rom Co., Inc., 108
F.3d 799, 805 (7th Cir. 1997) (“The place of injury was clearly
Saudi Arabia, where Kamel’s business would suffer as a re‐
sult of Hill‐Rom’s conduct.”); CMACO Auto. Sys., Inc. v.
Wanxiang Am. Corp., 589 F.3d 235, 246 (6th Cir. 2009) (con‐
cluding “the economic injury suffered by [the plain‐
tiff] … was clearly felt at its corporate headquarters”); Engine
Specialties, Inc. v. Bombardier Ltd., 605 F.2d 1, 19 (1st Cir. 1979)
(“The place of injury is where plaintiff suffered the
harm … at its place of business, Pennsylvania.”). Here, Ar‐
10 No. 17‐2324
mada’s principal place of business is in Singapore, so any
harm to Armada’s intangible bundle of litigation rights was
suffered in Singapore. Thus, the injury is not domestic, and
Armada has failed to plead a plausible claim under civil
RICO.
III.
A plaintiff advancing a civil RICO claim must allege a
domestic injury. Armada has not done so. Therefore, the dis‐
trict court’s entry of judgment on the pleadings on the RICO
counts of Armada’s amended complaint is AFFIRMED.