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United States District Court,

N.D. Georgia,

Rome Division.

 

Shirley WILLIAMS, Gale Pelfrey, Bonnie Jones, and Lora Sisson, individually and

on behalf of a class, Plaintiffs,

v.

MOHAWK INDUSTRIES, INC., Defendant.

 

No. CIV.A.4:04-CV-0003-H.

 

April 12, 2004.

 

 

Background: Current and former hourly employees brought action against employer, alleging violations of the federal and Georgia Racketeer Influenced and Corrupt Organizations Acts (RICO). Employer moved to dismiss.

 

  Holdings: The District Court, Murphy, J., held that:

  (1) employees were not required to satisfy heightened pleading requirements in pleading predicate act;

  (2) employees sufficiently alleged predicate act;

  (3) employees sufficiently alleged existence of an enterprise;

  (4) employees had standing to sue employer under RICO;

  (5) Georgia's RICO did not indicate legislative purpose to impose liability on corporations; and

  (6) employees lacked standing to assert unjust enrichment claim under Georgia law.

 

 Motion denied in part, and granted in part.

 

 

[1] Racketeer Influenced and Corrupt Organizations 0

 

319Hk0 k. 

 

For a plaintiff to have standing to pursue a private civil cause of action under the Racketeer Influenced and Corrupt Organizations Act (RICO), the plaintiff must prove the following elements: (1) that the defendant violated RICO; (2) that the plaintiff sustained an injury to his business or property; and (3) that the RICO violation caused the injury. 18 U.S.C.A. § §  1962, 1964(c).

 

[2] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

To prevail on a civil Racketeer Influenced and Corrupt Organizations Act (RICO) claim under section making it unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate in conduct of enterprise's affairs through a pattern of racketeering activity, the plaintiff must show: (1) the existence of an enterprise; (2) that the enterprise affected interstate commerce; (3) that the defendant was employed by or associated with the enterprise; (4) that the defendant participated, either directly or indirectly, in the conduct of the affairs of the enterprise; and (5) that the defendant participated through a pattern of racketeering activity. 18 U.S.C.A. §  1962(c).

 

[3] Federal Civil Procedure 0

170Ak0 k. 

 

Rather than apply heightened pleading requirements of rule requiring that fraud be pled with particularity to Racketeer Influenced and Corrupt Organizations Act (RICO) causes of action premised on non-fraud predicate acts, better approach is to apply the general pleading requirements of rule requiring that each averment of a pleading be simple, concise, and direct. 18 U.S.C.A. §  1961 et seq.; Fed.Rules Civ.Proc.Rules 8(e)(1), 9(b), 28 U.S.C.A.

 

[4] Federal Civil Procedure 0

170Ak0 k. 

 

Employer's alleged predicate acts of employing and harboring illegal workers did not sound in fraud, and thus, current and former hourly employees were not required to satisfy heightened pleading requirements of rule requiring that fraud be pled with particularity, in action against employer alleging violations of the Racketeer Influenced and Corrupt Organizations Act (RICO); rather, employees only had to satisfy general pleading requirements of rule requiring that each averment of pleading be simple, concise, and direct. 18 U.S.C.A. §  1961 et seq.; Fed.Rules Civ.Proc.Rules 8(e)(1), 9(b), 28 U.S.C.A.

 

[5] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

For a plaintiff to plead a violation of statute prohibiting employment of unauthorized aliens, as predicate act in a Racketeer Influenced and Corrupt Organizations Act (RICO) case, the plaintiff must simply allege that the aliens were brought into the United States for the purpose of illegal employment, but there is no requirement that the employer must have brought the aliens into this country. Immigration and Nationality Act, 8 U.S.C.A. §  1324(a)(3); 18 U.S.C.A. §  1961 et seq.

 

[6] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Employer's alleged employment of illegal workers, knowing that those workers were smuggled or otherwise brought into the United States illegally, supported claim for violation of statute prohibiting employment of unauthorized aliens, which served as predicate act in current and former employees' action against employer under the Racketeer Influenced and Corrupt Organizations Act (RICO). Immigration and Nationality Act, 8 U.S.C.A. §  1324(a)(3); 18 U.S.C.A. §  1961 et seq.

 

[7] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k.

 

For purposes of Racketeer Influenced and Corrupt Organizations Act (RICO) section making it unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate in conduct of enterprise's affairs through a pattern of racketeering activity, indictment must name a RICO person distinct from the RICO enterprise, and those entities must be distinct. 18 U.S.C.A. §  1962(c).

 

[8] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

The definitive factor in determining the existence of a Racketeer Influenced and Corrupt Organizations Act (RICO) enterprise is the existence of an association of individual entities, however loose or informal, that furnishes a vehicle for the commission of two or more predicate crimes, i.e., the pattern of racketeering activity requisite to the RICO violation; indeed, a RICO enterprise may be an "amoeba-like" structure or a loose informal association. 18 U.S.C.A. §  1962(c).

 

[9] Courts 0

106k0 k. 

 

Opinions of the United States Court of Appeals for the Fifth Circuit issued prior to October 1, 1981, the date marking the creation of the Eleventh Circuit, are binding precedent on courts within the Eleventh Circuit.

 

[10] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Although a pattern of racketeering activity must be shown by pointing to evidence of the requisite number of racketeering acts by participants in the enterprise, such evidence does not necessarily establish the existence of a Racketeer Influenced and Corrupt Organizations Act (RICO) enterprise; the enterprise is not the pattern of racketeering activity, but rather, it is an entity separate and apart form the pattern of activity in which it engages. 18 U.S.C.A. §  1962(c).

 

[11] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Allegations that employer participated in enterprise by paying third party employment agencies and other recruiters for illegal workers, and that enterprise provided means for commission of immigration law violations, supported current and former employees' claim, under the Racketeer Influenced and Corrupt Organizations Act (RICO), that employer operated or participated in affairs of an enterprise through a pattern of racketeering activity. 18 U.S.C.A. §  1962(c).

 

[12] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Liability under the Racketeer Influenced and Corrupt Organizations Act (RICO) depends on showing that the defendants conducted or participated in the conduct of the RICO enterprises's affairs, not just their own affairs. 18 U.S.C.A. §  1962(c).

 

[13] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Allegations that employment agencies and other recruiters were separate and independent entities from employer that paid them to hire illegal workers were sufficient to show existence of an enterprise distinct from employer itself, for purposes of current and former employees' claim under the Racketeer Influenced and Corrupt Organizations Act (RICO), alleging that employer operated or participated in affairs of an enterprise through a pattern of racketeering activity. 18 U.S.C.A. § §  1961(4), 1962(c).

 

[14] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Allegations that employment agencies and other recruiters shared common purpose of obtaining illegal workers for employment by employer were sufficient to show existence of common purpose among members of association-in-fact enterprise, for purposes of current and former employees' claim under the Racketeer Influenced and Corrupt Organizations Act (RICO), alleging that employer operated or participated in affairs of an enterprise through a pattern of racketeering activity. 18 U.S.C.A. §  1962(c).

 

[15] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Current and former hourly employees' complaint against employer, stating that employer hired illegal workers, and thereby depressed employees' wages, sufficiently alleged injury to employee's "business or property," for purposes of determining whether employees had standing to sue employer under the Racketeer Influenced and Corrupt Organizations Act (RICO). 18 U.S.C.A. §  1964(c).

 

[16] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

For a pattern of racketeering activity to be a cognizable cause of civil Racketeer Influenced and Corrupt Organizations Act (RICO) injury to a private plaintiff, one or more of the predicate acts must not only be the "but for" cause of the injury, but the proximate cause as well. 18 U.S.C.A. §  1964(c).

 

[17] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

For a plaintiff to have standing under the Racketeer Influenced and Corrupt Organizations Act (RICO), he must allege and prove that his injury flowed directly from the commission of the predicate acts. 18 U.S.C.A. §  1964(c).

 

[18] Federal Civil Procedure 0

170Ak0 k. 

 

Issue of whether employer's alleged predicate acts of harboring and inducing illegal aliens, and using and accepting bogus identification documents proximately caused current and former employees' injuries, i.e., depressed hourly wages, could not be resolved at motion to dismiss phase of employees' action against employer, alleging violations of the Racketeer Influenced and Corrupt Organizations Acts (RICO). 18 U.S.C.A. §  1964(c).

 

[19] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Current and former hourly employees' complaint against employer, stating that employer hired illegal workers to depress employees' wages, sufficiently alleged that employees sustained direct injury, for purposes of determining whether employees had standing to sue employer under the Racketeer Influenced and Corrupt Organizations Act (RICO). 18 U.S.C.A. §  1964(c).

 

[20] Federal Civil Procedure 0

170Ak0 k. 

 

Issue of whether employer's alleged employment of illegal aliens to depress wages caused injury to current and former employees that was not speculative could not be resolved at motion to dismiss phase of employees' action against employer, alleging violations of the Racketeer Influenced and Corrupt Organizations Acts (RICO). 18 U.S.C.A. §  1964(c).

 

[21] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Under Georgia law, because predicate acts under Georgia's Racketeer Influenced and Corrupt Organizations Act (RICO) are actually criminal offenses, statute governing criminal responsibility of corporations applies when determining whether a corporation is vicariously liable for the actions of its employees. West's Ga.Code Ann. § §  16-2-22, 16-14-4(a), 16-14-4(c).

 

[22] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Georgia's Racketeer Influenced and Corrupt Organizations Act (RICO) does not expressly and clearly indicate a legislative purpose to impose liability on a corporation for violations of the statute, as would permit the corporation to be prosecuted for predicate acts that are actually criminal offenses. West's Ga.Code Ann. § §  16-2-22(a)(1), 16-14-4(a), 16-14-4(c).

 

[23] Federal Civil Procedure 0

170Ak0 k. 

 

Issue of whether corporation's board of directors, or any corporate officers acting within scope of employment, authorized, requested, commanded, performed, or recklessly tolerated violations of Georgia's Racketeer Influenced and Corrupt Organizations Act (RICO) could not be resolved at motion to dismiss phase of employees' action against corporation, alleging that corporation violated Georgia's RICO by hiring illegal workers in order to depress wages. West's Ga.Code Ann. § §  16-2-22(a)(2), 16-14-4(a), 16-14-4(c).

 

[24] Racketeer Influenced and Corrupt Organizations 0

319Hk0 k. 

 

Under Georgia law, criminal liability will attach to a corporation for the acts of its employees only if the crime is authorized, requested, commanded, performed, or recklessly tolerated by the board of directors or by a managerial official who is acting within the scope of his employment in behalf of the corporation. West's Ga.Code Ann. § §  16-2-22(a)(2), 16-14-4(a), 16-14- 4(c).

 

[25] Implied and Constructive Contracts 0

205Hk0 k. 

 

Under Georgia law, recovery under a theory of unjust enrichment presupposes the absence of a contractual agreement.

 

[26] Implied and Constructive Contracts 0

205Hk0 k. 

 

Under Georgia law, the measure of damages under unjust enrichment is based upon the benefit conferred upon the recipient, and not the cost to render the service or cost of the goods.

 

[27] Federal Civil Procedure 0

170Ak0 k. 

 

Issue of whether employer reaped substantial wage savings by hiring and harboring illegal workers could not be resolved at motion to dismiss phase of current and former employees' action against employer, alleging unjust enrichment claim under Georgia law.

 

[28] Federal Civil Procedure 0

170Ak0 k. 

 

Current and former employees lacked standing to assert a claim against employer for unjust enrichment under Georgia law, as to amount of money employer did not have to spend in dealing with workers' compensation claims given that it allegedly hired illegal workers in order to depress wages, where employer's higher profit margins due to lower workers' compensation costs were not connected in any way to employees' receiving lower wages.

 John Earl Floyd, Joshua F. Thorpe, Ronan P. Doherty, Nicole G. Iannarone, Bondurant Mixson & Elmore, Atlanta, GA, Bobby Lee Cook, Cook & Connelly, Summerville, GA, Howard Foster, phv, Johnson & Bell, Chicago, IL, Matthew Daniel Thames, Goddard Thames Hammontree & Bolding, Dalton, GA, for Plaintiffs.

 

 Robert Carl Cannon, Rosemary C. Lumpkins, Constangy Brooks & Smith, Atlanta, GA, Steven Thomas Cottreau, phv, Juan P. Morillo, phv, Virginia A. Seitz, phv, Sidley Austin Brown & Wood, Washington, DC, for Defendant.

 

 

ORDER

 

 MURPHY, District J.

 

 *1 This is a class action alleging violations of the federal and Georgia Racketeer Influenced and Corrupt Organizations Acts ("RICO"). The case is before the Court on Defendant's Motion to Dismiss [25].

 

 I. Background

 

 A. The Parties

 

 Plaintiffs are current and former hourly employees of Defendant who claim that Defendant's alleged employment and harboring of illegal aliens has depressed their wages. (Compl.¶  1.) Plaintiffs Gale Pelfrey, Shirley Williams, Bonnie Jones, and Lora Sisson are citizens of Georgia and reside in the Northern District of Georgia. (Id. ¶ ¶  5-8.) Plaintiffs Pelfrey, Williams, and Sisson are former hourly employees of Defendant. (Compl.¶ ¶  5, 6, 8.) Plaintiff Jones is currently an hourly employee of Defendant. (Id.  7.) Plaintiffs Pelfrey, Williams, Sisson, and Jones are eligible to be employed in the United States. (Id. ¶ ¶  5-8.) Plaintiffs seek certification of a class consisting of all current and former employees of Defendant legally authorized to be employed in the United States who are or have been employed in hourly wage positions at any time since January 5, 1999, to the present (the "Class"). [FN1] (Id.  39.)

 

 Defendant is the second largest carpet and rug manufacturer in the United States. (Compl.¶  2.) Defendant employs approximately 31,780 persons, most of whom are employed in Northwest Georgia. (Id.) Defendant owns or leases at least twenty-six facilities in Georgia. (Id.) Defendant is a Delaware corporation with its principal place of business in Calhoun, Georgia. (Id.  9.)

 

 B. Plaintiffs' Allegations

 

 Plaintiffs allege that Defendant has engaged in illegal hiring of persons who are not eligible for employment in the United States in an effort to keep costs of labor as low as possible. (Compl.¶  14.) According to Plaintiffs, Defendant has accepted for employment and continues to employ workers that it knew or had reason to know were not authorized to work in the United States. (Id.  15.) Plaintiffs allege that Defendant has knowingly and recklessly accepted false documents or documents that do not match the identity of the person presenting the documents as proof of eligibility for employment. (Id.  16.) Additionally, Plaintiffs claim that Defendant has knowingly and recklessly accepted proof of eligibility for employment documents reflecting successive different names for a single person. (Id. ¶ ¶  17, 19.) Indeed, Plaintiffs allege that when some illegal workers have informed Defendant that they would return to their countries of origin, supervisors employed by Defendant have encouraged those employees to return to the United States and illegally reapply for work at Defendant. (Id.  18.)

 

 Plaintiffs claim that in an effort to conceal Defendant's employment and harboring of illegal workers, Defendant's employees have destroyed eligibility documents indicating that workers have employed different names and identification papers. (Compl.¶  20.) Furthermore, according to Plaintiffs, Defendant's employees and supervisors have stated that they are aware that illegal workers can easily obtain false identification and work authorization documents. (Id.  21.)

 

 *2 Plaintiffs claim that Defendant's employees have traveled to the United States border to recruit illegal aliens. (Compl.¶  22.) According to Plaintiffs, those employees and other persons then transported the illegal aliens to North Georgia for employment at Defendant's facilities. (Id.) Plaintiffs allege that Defendant has provided incentive to its employees and other recruiters by paying for locating illegal workers that Defendant eventually employs and harbors. (Id.) Plaintiffs contend that Defendant's employees and recruiters have provided housing for illegal workers when the workers arrived in North Georgia, and have aided those illegal workers in finding employment with Defendant. (Id.  23.)

 

 Occasionally, Defendant audits its workforce and discovers illegal workers are employed with Defendant. (Compl.¶  24.) According to Plaintiffs, Defendant has not increased the frequency of such audits despite the fact that the audits reveal that a large number of illegal workers are employed at Defendant. (Id.) Furthermore, Plaintiffs allege that when Defendant terminates an illegal worker after discovering that the illegal worker is not authorized to work in the United States, the worker frequently returns to work under a different name. (Id.  25.) Plaintiffs claim that this practice, termed "recycling," is widespread at Defendant. (Id.  26.) According to Plaintiffs, Defendant has been further put on notice of illegal workers because many illegal workers artificially inflate their claimed exemptions, thus avoiding paying federal income tax. (Id.  32.)

 

 Plaintiffs allege that law enforcement authorities have raided Defendant's facilities in search of illegal workers. (Compl.¶  27.) Plaintiffs claim that when such raids have occurred, illegal workers have hidden in barrels or other containers or have fled. (Id.) According to Plaintiffs, the number of illegal workers who run or hide has put Defendant on notice that it employs a large number of illegal workers. (Id.) Moreover, Plaintiffs contend that Defendant's employees and supervisors have assisted illegal workers in evading the law enforcement authorities. (Id.  28.)

 

 Plaintiffs state that law enforcement authorities have arrested some illegal workers at Defendant's facilities. (Compl.¶  29.) Plaintiffs further allege that law enforcement authorities have discovered undocumented aliens in possession of paychecks issued by Defendant or identification badges and fraudulent identification documents. (Id.  30.)

 

 According to Plaintiffs, Defendant's supervisors have stated that illegal workers are preferable because those workers are more tolerant of working conditions and do not submit claims for workers' compensation. (Compl.¶  31.) Plaintiffs contend that because many of Defendant's workers are undocumented aliens, Defendant knows that those workers are beholden to Defendant, and thus are unlikely to complain about working conditions or file workers compensation claims. (Id. ¶ ¶  36-37.) Consequently, Plaintiffs believe that Defendant saves a considerable amount of money by employing undocumented aliens. (Id.  37.)

 

 *3 According to Plaintiffs, Defendant's practice of employing and harboring large numbers of illegal workers has allowed Defendant to depress wages; consequently, the wages paid to hourly employees, including the legally employed hourly employees who are members of the Class, are lower than those wages would be if Defendant did not employ and harbor illegal workers. (Compl.¶  33.) Plaintiffs allege that Defendant employs tens of thousands of hourly workers in North Georgia (id.  34), and Defendant's widespread employment and harboring of illegal workers has substantially increased the supply of workers from which Defendant hires its hourly workers (id.  35). Plaintiffs contend that because of the increased size of the labor pool, Defendant has depressed the wages it pays to all of its hourly employees, including members of the Class. (Id.) In other words, Plaintiffs claim that Defendant had only hired persons legally authorized to work in the United States, Defendant would have had to pay higher wages to Plaintiffs and the members of the Class. (Id.) Thus, according to Plaintiffs, as a direct and proximate result of Defendant's employment and harboring of illegal workers, the wages that Plaintiffs and the members of the Class have earned have been depressed.

 

 C. Plaintiffs' RICO Claims

 

 1. Pattern of Racketeering Activity

 

 Plaintiffs first allege that Defendant is engaged in an ongoing pattern of racketeering activity as defined by 18 U.S.C.A. §  1961(5) & (8). (Compl.¶ ¶  54, 56.) According to Plaintiffs, Defendant has engaged in racketeering activity, namely, an open and ongoing pattern of violations of Section 274 of the Immigration and Nationality Act, 8 U.S.C.A. §  1324(a), more than twice, and the most recent occurrence took place within ten years after the commission of a prior act of racketeering activity. (Id.  55, 57, 58.) In particular, Plaintiffs allege that Defendant has violated and continues to violate: (1) 8 U.S.C.A. §  1324(a)(3)(A), which makes it a federal crime to "knowingly hire[ ] for employment at least 10 individuals with actual knowledge that the individuals are aliens" during a twelve month period (id.  59); (2) 8 U.S.C.A. §  1324(a)(1)(A)(iii), which makes it a federal crime to "conceal [ ], harbor[ ] or shield from detection, or attempt[ ] to conceal, harbor or shield from detection" aliens that have illegally entered the United States (id.  60); and (3) 8 U.S.C.A. §  1324(a)(1)(A)(iv), which makes it a federal crime to "encourage[ ] or induce[ ] an alien to come to, enter, or reside in the United States, knowing or in reckless disregard of the fact that such coming to, entry, or residence is or will be in violation of law" (id.  61). Plaintiffs contend that each violation of 8 U.S.C.A. §  1324 constitutes an act of "racketeering activity" as defined by 18 U.S.C.A. §  1961(1)(F). (Id.  62.)

 

 According to Plaintiffs, the "racketeering activity" also includes Defendant's open and ongoing violations of 18 U.S.C.A. §  1546(a) by knowingly accepting various false identification documents and other false documents indicating authorization for legal employment, and Defendant's continued violations of 18 U.S.C.A. §  1546(b) by using such documents to fill out I-9 forms. (Compl. ¶ ¶  63-64.) Plaintiffs allege that each violation of 18 U.S.C.A. §  1546 constitutes an act of "racketeering activity" as defined by 18 U.S.C.A. §  1961(1)(B) as well as O.C.G.A. §  16-14-3(9)(A)(xxix). (Id. ¶ ¶  65-66.)

 

 *4 Plaintiffs claim that the acts of Defendant's racketeering activity have the same or similar methods of commission in that those acts involve the knowing employment of illegal workers, the concealment, harboring, and shielding from detection of illegal workers, and the acceptance or use of fraudulent documents in connection with the hiring of illegal workers. (Compl.¶  67.) According to Plaintiffs, the acts of racketeering activity have the same or similar objective--i.e. the reduction of wages paid to Defendant's workforce. (Id.  68.) Plaintiffs allege that the victims of those acts of racketeering activity are the same or similar. (Id.  69.) Plaintiffs also contend that the distinguishing characteristics of the acts of racketeering activity include the involvement of Defendant, illegal workers, and other third parties who assist in the recruitment and transportation of undocumented aliens. (Id. ¶ ¶  70, 76-84.)

 

 According to Plaintiffs, those acts of racketeering activity have occurred over a long period of time, and have become a part of Defendant's regular way of doing business. (Compl.¶ ¶  71-73.) Plaintiffs assert that Defendant has committed hundreds, and perhaps thousands, of violations of 8 U.S.C.A. §  1324 and 18 U.S.C.A. §  1546 as part of its racketeering activity. (Id.  74.) Indeed, Plaintiffs claim that Defendant's racketeering activity has been so pervasive that illegal workers currently constitute a majority of the workforce in many of Defendant's facilities in North Georgia. (Id.  75.)

 

 2. Enterprise

 

 Plaintiffs also allege that Defendant has engaged in its pattern of racketeering activity through its participation in an association-in-fact enterprise, as defined by 18 U.S.C.A. §  1961(4), with third party employment agencies and other recruiters who supply Defendant with illegal workers. (Compl.¶ ¶  76, 79.) Plaintiffs claim that one such recruiter is Temporary Placement Services ("TPS"), which has a formal relationship with Defendant in that TPS employs illegal workers and then loans those workers to Defendant for a fee. (Id.) According to Plaintiffs, other recruiters simply find workers in an area surrounding Brownsville, Texas, and then transport those workers to Georgia. (Id.) Plaintiffs contend that TPS and other recruiters also occasionally assist current and prospective illegal workers in assuming new identities. (Id.) Plaintiffs allege that those recruiters share the common purpose of obtaining illegal workers for employment with Defendant. (Id.  77.) Additionally, Plaintiffs contend that Defendant participates in the operation and management of the affairs of the enterprise, which exists fo Defendant's benefit. (Id.  78.)

 

 Plaintiffs allege that the enterprise affects interstate commerce in that the illegal workers employed by Defendant travel in international and interstate commerce to reach Defendant's facilities in North Georgia. (Compl.¶ ¶  80, 81.) According to Plaintiffs, the enterprise also affects interstate commerce in that the wages of legal workers employed with Defendant are depressed. (Id.  82.) Furthermore, Plaintiffs state that because Defendant is a member of the enterprise and is directly engaged in the production, distribution, and acquisition of goods and services in interstate commerce, the enterprise affects interstate commerce. (Id.  83.)

 

 *5 According to Plaintiffs, Defendant, by accepting and retaining the benefits of the racketeering activity, ratified the conduct of Defendant's managers, employees, and the members of the enterprise who assisted Defendant in committing those acts of racketeering activity. (Id.  84.)

 

 3. Causation

 

 Plaintiffs next allege that Defendant's violations of federal and Georgia RICO proximately caused the wages of Plaintiffs and the members of the Class to be lower than their wages otherwise would have been had the labor pool consisted solely of legally employed workers. (Compl.¶  85.) Thus, Plaintiffs and the Class claim that they have suffered an injury to their business or property. (Id.  86.) As a result, Plaintiffs contend that Defendant has earned or retained significant funds to which it is not entitled. (Id.  87.)

 

 D. Procedural Background

 

 On January 6, 2004, Plaintiffs filed this lawsuit. Plaintiffs assert the following claims: (1) a claim that Defendant's conduct violates 18 U.S.C.A. §  1962(c) (Compl.88-92); (2) a claim that Defendant's conduct violates O.C.G.A. §  16-14-4(a) (id. 93-98); (3) a claim that Defendant's conduct violates O.C.G.A. §  16-14-4(c) (id. 99-105); and a claim for unjust enrichment arising under Georgia law (id. ¶ ¶  106-110). Plaintiffs also seek certification of a class pursuant to Federal Rule of Civil Procedure 23. (Id.  46.)

 

 On February 9, 2004, Defendant filed its Motion to Dismiss pursuant to Federal Rules of Civil Procedure (12)(b)(6) and (12)(b)(1), [FN2] in which Defendant requests that the Court dismiss Plaintiffs' federal and state RICO claims. Defendant also requests that the Court decline to exercise its pendent jurisdiction over Plaintiffs' state law claims.

 

 II. Standard Governing Motions to Dismiss

 

 The standard for a court to dismiss a claim is whether "it appears beyond doubt that the plaintiff can prove no set of facts to support his claim." GSW, Inc. v. Long County, 999 F.2d 1508, 1510 (11th Cir.1993) (citing Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). When considering a motion to dismiss, the Court "must accept the allegations in the complaint as true, construing them in the light most favorable to the plaintiffs." White v. Lemacks, 183 F.3d 1253, 1255 (11th Cir.1999). However, "[a]s a general rule, conclusory allegations and unwarranted deductions of fact are not admitted as true in a motion to dismiss." S. Fla. Water Mgmt. Dist. v. Montalvo, 84 F.3d 402, 408 n. 10 (11th Cir.1996).

 

 III. Discussion

 

 A. Plaintiffs' Federal RICO Claim

 

 [1][2] 18 U.S.C.A. §  1962(c) provides: "It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt." 18 U.S.C.A. §  1962(c). RICO establishes both civil remedies and criminal penalties for violations of §  1962. See 18 U.S.C.A. § §  1963- 1964. In particular, §  1964(c) provides that "[a]ny person injured in his business or property by reason of a violation of section 1962 of this chapter may sue therefor in any appropriate United States district court and shall recover threefold the damages he sustains and the cost of the suit, including a reasonable attorney's fee ...." 18 U.S.C.A. §  1964(c). Thus, for a plaintiff to have standing to pursue a private civil cause of action under RICO, the plaintiff must prove the following elements: (1) that the defendant violated §  1962; (2) that the plaintiff sustained an injury to his business or property; and (3) that the violation of §  1962 caused the injury. Avirgan v. Hull, 932 F.2d 1572, 1577 (11th Cir.1991) (citing O'Malley v. O'Neill, 887 F.2d 1557, 1560-61 (11th Cir.1989)). Likewise, to prevail on a civil RICO claim under §  1962(c), the plaintiff must show: (1) the existence of an enterprise; (2) that the enterprise affected interstate commerce; (3) that the defendant was employed by or associated with the enterprise; (4) that the defendant participated, either directly or indirectly, in the conduct of the affairs of the enterprise; and (5) that the defendant participated through a pattern of racketeering activity. United States v. Starrett, 55 F.3d 1525, 1541 (11th Cir.1995).

 

 *6 18 U.S.C.A. §  1961 provides definitions for some of the terms used in §  1962(c). "Racketeering activity" includes a number of "predicate acts" that