Court dumps lawsuit targeting companies that hire illegals

A federal appeals court that presides over Arizona rejected one county's creative effort to crack down on companies that hire undocumented workers: Sue them for racketeering.

In a unanimous decision Friday, the 9th U.S. Circuit Court of Appeals threw out a federal lawsuit filed by Canyon County, Idaho, against four companies and one person it accused of an "illegal immigrant hiring scheme."

The lawsuit said each of the firms knowingly employed or harbored undocumented workers in violation of federal law.

But what the county sought was not an injunction against the firms and the individual, who is a migrant counselor, but instead the recovery of "millions of dollars for health care services and criminal justice services for the illegal immigrants."

The appellate court said, in essence, "Nice try."

Friday's ruling is significant because the 9th Circuit sets policy for 14 western states, including Arizona. That bars future similar lawsuits by either those states or any of their local governments unless the decision is overturned.

The county's lawsuit was based on the federal Racketeer Influence and Corrupt Organizations act, commonly known as RICO.

That law makes it illegal for anyone to engage in a pattern of activity that violates certain laws. In this case, the underlying law on which the county was relying deals with harboring, transporting or hiring undocumented workers.

RICO also allows any person injured as a result of those acts to sue for triple the amount of assessed damages.

Judge Wallace Tashima, writing for the court, said Canyon County's approach is legally flawed.

He said it may be true that the county has been forced to spend money because of the acts of the defendants.

But Tashima said governments, unlike individuals, have no property interest in the services they provide to the public.

That means for all intents and purposes Canyon County "lost" nothing that can be recovered under RICO.

He said even if the county could show some injury to its property interest, there is no evidence that the actions of the defendants is directly related to its damages of increased costs.

"There are numerous alternative causes that might be the actual source or sources of the county's alleged harm," Tashima wrote. "Increased demand for public health care and law enforcement may result from such varied factors as demographic changes; alterations in criminal laws or policy; changes in public health practices; shifts in economic variables such as wages, insurance coverage, and unemployment; and improved community education and outreach by the government."

Tashima added that court proceedings to determine what damages the county actually sustained because of the actions of the companies "would be speculative in the extreme."

Howard Foster, who represented the county, said he does not believe any of the defendants ever were charged by federal officials with violating immigration laws. He said no decision has been made whether to appeal.