Hunton & Williams client Sodexo Inc. announced last week that it has settled its civil RICO lawsuit against the Service Employees International Union, marking the end of the SEIU’s contentious two year corporate campaign against the company. Sodexo had alleged that the union conduct constituted extortion under RICO. Earlier this summer, the U.S. District Court for the Eastern District of Virginia, in which the case was pending, denied the SEIU’s motion to dismiss the case, finding that Sodexo had stated viable RICO claims.
Sodexo’s racketeering suit is the latest in a series of recent RICO actions brought by major employers facing union corporate campaign attacks. In 2008, Hunton & Williams brought a similar suit on behalf of Smithfield Foods, Inc., which alleged that the United Food and Commercial Workers Union had tried to extort Smithfield into recognizing the union as bargaining agent at Smithfield’s Tar Heel, North Carolina plant. That case survived both a motion to dismiss and summary judgment and settled on the morning of trial. Other similar RICO cases, however, have not met with the same level of success. In 2009, federal district courts in New York and Florida dismissed civil RICO claims brought against unions by Cintas Corp. and Wackenhut, respectively.