Yegiazaryan v. Smagin

In Yegiazaryan v. Smagin, Vitaly Smagin, a Russian citizen, obtained an arbitration award of approximately $84 million against Aslan Yegiazaryan in London and confirmed it as a California judgment. Smagin alleged that Yegiazaryan and associates engaged in mail and wire fraud, money laundering, and witness tampering in the United States to conceal assets and avoid paying the award. The district court dismissed the civil RICO claims, ruling that a foreign plaintiff had suffered only a foreign injury. The Ninth Circuit reversed, finding a domestic injury to Smagin's California judgment. The Supreme Court affirmed in a 6-3 decision, holding that the alleged scheme could cause a domestic injury to intangible property located in the United States, thus allowing the RICO suit to proceed.

The Supreme Court affirmed the Ninth Circuit in a 6-3 ruling written by Justice Sonia Sotomayor, holding that Smagin had plausibly alleged a domestic injury to his California judgment confirming the arbitration award, so the RICO claims could proceed.

Whether a foreign plaintiff alleging a scheme to evade a U.S.-confirmed arbitration award can satisfy the civil RICO domestic-injury requirement when the injury is to intangible property.

The decision clarifies civil RICO's reach in transnational disputes, making it easier for foreign plaintiffs to pursue U.S.-based assets and fraudulent schemes in federal court. It has significant implications for international arbitration, judgment enforcement, and cross-border asset recovery.