## Facts

- Multiple plaintiffs, including Dixie Carriers, Inc., filed consolidated civil actions against marine-industry corporations controlled by the Fredeman family and certain officers.
- Customers alleged defendants systematically overbilled for fuel by charging for more fuel than was delivered; competitors alleged antitrust violations.
- Plaintiffs sought primarily money damages, including treble damages under civil RICO.
- Before the civil suits, the federal government brought criminal RICO charges and obtained an order restraining defendants from disposing of most assets during the criminal case; that restraint ended when the criminal proceedings concluded.
- After the criminal restraint lapsed, plaintiffs obtained a civil temporary restraining order and then a preliminary injunction restricting defendants from transferring or removing virtually any assets without court approval and notice to plaintiffs, and requiring reporting of certain disbursements.
- The restrained assets were not alleged to be a specific res in dispute; the injunction was entered to preserve funds for possible satisfaction of a future damages judgment.
- Defendants appealed the preliminary injunction.

## Issues

1. Whether a federal district court has inherent equitable authority to preliminarily restrain a defendant’s general assets, not specifically in dispute, solely to secure collectability of a potential money judgment.
2. Whether civil RICO, 18 U.S.C. § 1964, authorizes private plaintiffs seeking treble damages to obtain a pre-judgment injunction freezing a defendant’s general assets.
3. Whether pendent state-law claims supply authority in federal court to impose such an asset-freezing injunction.

## Decision

- The Fifth Circuit vacated the preliminary injunction.
- The court held the district court lacked authority to freeze defendants’ general assets under traditional equitable principles.
- The court held civil RICO did not authorize the injunction sought by private treble-damages plaintiffs in these circumstances.
- The court held pendent state-law claims did not justify the injunction, particularly where prejudgment security must proceed through specific, authorized procedures rather than a broad equitable freeze.

## Legal Principles

- In actions seeking primarily money damages, federal courts generally may not issue a pre-judgment injunction restraining a defendant’s transfer of general assets merely to ensure funds will exist to satisfy a later judgment.
- Equitable relief to preserve property is ordinarily available only when the plaintiff asserts a specific equitable interest in identified property (or comparable recognized basis), not when the requested restraint functions as generalized prejudgment security.
- Civil RICO’s private treble-damages remedy does not, by itself, permit private plaintiffs to obtain a preliminary injunction freezing assets not themselves the subject of a specific equitable claim or statutory forfeiture mechanism.
- Pendent state-law theories do not expand federal equitable power; where state law provides prejudgment remedies, they must be pursued through the applicable statutory and procedural mechanisms rather than an open-ended injunction.

## Conclusion

The Fifth Circuit vacated a sweeping preliminary injunction that froze defendants’ general assets because the district court lacked authority—under equity, civil RICO, or pendent state law—to restrain property unrelated to a specific property dispute solely to secure potential satisfaction of a future damages award.


In re Fredeman Litig., 843 F.2d 821 (5th Cir. 1988)