Furthermore, the complaint sets forth three or more specific "racketeering acts" sufficient to satisfy the RICO pleading requirement of at least two predicate acts. See 18 U.S.C. 1962 et. seq. Specifically, plaintiff alleges that on or about August 20, 1985 Rosenthal and Sinoway did cause defendants Laurriet, Pippert and Gemini to submit bids that while appearing competitive were in fact rigged to favor Laurriet printing. See paragraph 3, First Count. On or about September 20, 1985, in a phone call to Sinoway, and with Essenfeld and Sinoway's consent, Rosenthal transmitted fabricated bids on behalf of various printing agencies so as to make Laurriet's bid lowest and ensure that Laurriet would receive a contract for Sharp manuals. See paragraph 4, First Count. Finally, on or about October 4, 1985, defendant Sinoway disclosed Printing Mart's confidential bid to Laurriet instructing Laurriet to come in with a lower bid, thereby depriving Printing Mart of its competitive rank. See paragraph 5, First Count.
The information contained in plaintiff's complaint readily permits a sufficiently specific RICO pleading. This court is convinced that plaintiff could have alleged its RICO claim and then, if necessary, amended to provide additional detail following discovery. The allegations made provide ample evidence of defendants' use of mails and interstate communications to permit assertion of the mail and wire fraud RICO violations.
The court recognizes that discovery of the investigative report furnished plaintiff with extensive additional detail concerning the alleged bid rigging and kickback scheme. Plaintiff is certainly correct in asserting that it did not know the intricacies of defendants' racketeering activities prior to disclosure of this information by Mr. Harofilis and receipt of the report. The relevant inquiry though is not whether plaintiff now knows more than it did at the time of filing the state court action, but rather, did it know enough at the time of the earlier legal proceeding to state a cause of action. For the reasons set forth in this opinion, the court is forced to conclude that plaintiff did have sufficient knowledge and that therefore the preclusive effect of the entire controversy doctrine must apply.
The court reaches this conclusion with great reluctance since it results in barring what appears to be a meritorious claim by the plaintiff. Moreover, a dismissal in this case does not comport with the underlying purpose of the entire controversy doctrine.
The doctrine exists to protect parties who have fully litigated a controversy from the burden of vexatious, duplicative litigation by the unsuccessful litigant. As the initial state court complaint was dismissed at the pleadings stage, the burden of defending this action was minimal. Furthermore, a close reading of the record reveals that the bid rigging issue was not actually litigated in the state proceeding. The state court's pronouncements on the existence of "legitimate competition" all go to the question of whether Printing Mart had exclusive contractual rights to do Sharp's printing, or whether Sharp was free to do business elsewhere; not whether any bid rigging was going on. See Transcript of State Court Proceedings, June 6, 1986, Plaintiff's Exhibit B at 17, 24. Nevertheless, the rigid requirement to assert all aspects of a single controversy in a single legal proceeding applies where, as here, the plaintiff was able, but chose not to, raise its RICO claim in the earlier action.
The court takes some small comfort from the fact that the state court action is now on appeal, and although the decision below is likely to be affirmed, the state court may grant plaintiff leave to amend, particularly since this forum is now closed to it.
Having determined that plaintiff's complaint is precluded under the entire controversy doctrine, the court need not reach defendant's arguments on the issue of collateral estoppel.
For the reasons set forth above, this court grants defendants motion and hereby dismisses Printing Mart's RICO complaint.
H. LEE SAROKIN, U.S.D.J.
This matter having been opened to the court by defendants' motion to dismiss plaintiff's complaint on the grounds of claim preclusion, and this court having heard oral argument and having considered the submissions of both parties, and for the reasons expressed in the court's opinion filed this day,
IT IS this 29th day of December, 1986 hereby ORDERED that defendants' motion is granted and it is further,
ORDERED that plaintiff's complaint be, and hereby is, dismissed on the grounds that it is precluded under the New Jersey entire controversy doctrine.
H. LEE SAROKIN, U.S.D.J.