CLUNEY v. BROWNELLS INC et al

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UNITED STATES DISTRICT COURT
DISTRICT OF MAINE
BILLI-JO CLUNEY,
individually and as personal
representative for the Estate of
James M. Cluney, Sr.,
Plaintiff,
v.
BROWNELLS, INC., MDX CORP.,
and FEDEX CORPORATE SERVICES,
INC.,
Defendants.
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1:24-cv-00207-SDN
ORDER AFFIRMING RECOMMENDED DECISION
Plaintiff Billi-Jo Cluney, acting in her individual capacity and as a representative
for the estate of her deceased husband, seeks leave to amend her complaint under Federal
Rule of Civil Procedure 15(a)(2). ECF No. 46 (“Motion to Amend”). Two Defendants,
Brownells, Inc. and MDX Corp., oppose the motion. ECF Nos. 47, 48. On November 25,
2025, the Magistrate Judge issued his recommended decision, recommending that her
motion be granted in part and denied in part. ECF No. 57 (“Recommended Decision”).
For the reasons below, the Court AFFIRMS the Recommended Decision and GRANTS
in part and DENIES in part Plaintiff’s Motion to Amend.
I. 	Background
This Order incorporates by reference the factual background previously outlined
by this Court. See ECF No. 33 at 5–10. As relevant here, the Plaintiff initially named three
defendants in her complaint, Brownells, MDX, and FedEx Corporate Services, Inc.,
bringing eighteen counts including negligence and other claims against the companies
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and seeking money damages for their alleged roles in the shooting death of her husband,
James M. Cluney, Sr., by 	then-minor Atilio 	Delgado. See ECF No. 1-1 	(“Original
Complaint”). Brownells and MDX are retail distributors of firearms part kits, colloquially
referred to as “ghost gun kits.” Id. at 6–7. FedEx is a shipping company that allegedly
delivered ghost gun kits and ammunition sold by MDX and Brownells to Atilio Delgado.
Id. at 8–9. The complaint asserts Atilio Delgado used the ghost gun kits to assemble a
firearm which he later used to fatally shoot Mr. Cluney. Id. at 20–21. On July 8, 2024,
MDX and Brownells each moved to dismiss the complaint, ECF Nos. 16, 17, which this
Court denied, ECF No. 33.
On July 3, 2025, Plaintiff filed an amended complaint, ECF No. 44, which the
Magistrate Judge struck because Plaintiff had obtained neither leave of the Court nor the
Defendants’ consent to file an amended complaint, ECF No. 45; see Fed. R. Civ. P. 15(a)(2)
(“[A] party may amend its pleading only with the opposing party’s written consent or the
court’s leave.”). On July 11, 2025, Plaintiff filed the instant Motion to Amend the
complaint, ECF No. 46, which MDX and Brownells oppose, ECF Nos. 47, 48. FedEx has
taken no position.
In the Proposed Amended Complaint (“PAC”) that accompanies her Motion to
Amend, see ECF No. 46-1, Ms. Cluney purports to make several changes to her claims.
First, she seeks to substitute Federal Express Corporation for FedEx Corporate Services,
Inc.1 Id. at 1. Second, she seeks to amend the factual allegations to include new
information she received after the filing of the Original Complaint. Id. Third, she wishes
to clarify that the punitive damages she seeks against MDX should be evaluated under
1 Because this change seeks merely to clarify the correct legal entity for FedEx according to FedEx’s
corporate counsel, see ECF No. 46 at 5, the Court grants this request.
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California law and the damages against FedEx and Brownells should be evaluated under
Iowa law. Id. Finally, she seeks leave to add claims against Brownells for alleged mail
fraud in violation of the Racketeer Influenced and Corrupt Organizations (“RICO”)
statute, 18 U.S.C. §§ 1961–68.2 ECF No. 46-1 at 120–23.
II. 	RICO Claim Against Brownells
A. Standard of Review
A motion to amend generally is not considered a dispositive motion, but when a
magistrate judge issues a recommendation that would effectively end a party’s claim or
defense, de novo review applies. See Sargent v. NorDx, No. 2:20-CV-00467, 2022 WL
17738711, at *4 (D. Me. Dec. 16, 2022); Summer Infant (USA), Inc. v. Tomy Int’l, Inc., No.
1:17-CV-549, 2020 WL 4437259, at *1 (D.R.I. Aug. 3, 2020); Fed. R. Civ. P. 72(b)
(establishing a de novo standard of review for magistrate judges’ dispositive motions).
Because the Magistrate Judge recommended denying Plaintiff’s motion to add a RICO
claim, the Court applies de novo review to determine whether she has met her burden to
amend.3 See Emissive Energy Corp. v. NovaTac, Inc., No. C.A. 09-13, 2010 WL 2991201,
at *2 (D.R.I. July 28, 2010).
Federal Rule of Civil Procedure 15(a) governs amendments to pleadings and
provides that leave to amend should be “freely” given “when justice so requires.” Fed. R.
Civ. P. 15(a)(2). Because the time to amend as a matter of course under Rule 15(a)(1) has
2 Ms. Cluney’s PAC originally advanced three claims—Counts 19, 21, and 24—against Brownells for unfair
trade practices. See ECF No. 46-1 at 115–16, 117–19, 123–25. She stated in her reply in support of her Motion
to Amend that she consents to removal of those counts from the PAC; accordingly, the Court does not
address those counts further. ECF No. 49 at 7.
3 Regardless of whether the Court applies a de novo standard of review or the more forgiving “clearly
erroneous” review standard for non-dispositive orders, see Fed. R. Civ. P. 72(a), the Court adopts the
Magistrate Judge’s Recommended Decision to deny Plaintiff’s motion to add a RICO claim.
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expired, the Court may grant leave to amend “freely” unless there is an “apparent or
declared reason” to withhold leave—such as “undue delay, bad faith or dilatory motive on
the part of the movant, repeated failure to cure deficiencies by amendments previously
allowed, undue prejudice to the opposing party by virtue of allowance of the amendment,
[or] futility of amendment . . . .” Foman v. Davis, 371 U.S. 178, 182 (1962).
The Court evaluates the Motion to Amend under the futility standard: a proposed
amendment is futile if the complaint, as amended, would not withstand a motion to
dismiss. Shannon v. Houlton Band of Maliseet Indians, 54 F. Supp. 2d 35, 38 (D. Me.
1999). In turn, the Court applies the Rule 12(b)(6) motion to dismiss standard. Glassman
v. Computervision Corp., 90 F.3d 617, 623 (1st Cir. 1996). To survive a motion to dismiss,
“a complaint must contain sufficient factual matter, accepted as true, to state a claim to
relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quotation
modified). All reasonable inferences from the factual allegations must be drawn in the
Plaintiff’s favor. Garita Hotel Ltd. P’ship v. Ponce Fed. Bank, F.S.B., 958 F.2d 15, 17 (1st
Cir. 1992).
B. Analysis
The PAC alleges Brownells committed criminal mail fraud, as defined by 18 U.S.C.
§ 1341, when it engaged in a scheme to conceal the contents of the packages it shipped to
Atilio 	Delgado. Specifically, the PAC claims Brownells failed to properly label the
packages it sent to Mr. Delgado as containing handgun ammunition with the required
“Limited Quantity Item” marking. ECF No. 46-1 at 121. It further alleges Brownells
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concealed its identity by eschewing its registered corporate shipping account in favor of
an allegedly fictitious Iowa address.4 Id. at 122.
Because mail fraud qualifies as a predicate criminal act for RICO purposes, see 18
U.S.C. § 1961(a), the PAC asserts Brownells engaged in a pattern of racketeering activity
in the form of mail fraud, such that it should be liable for treble damages under RICO,
ECF No. 46-1 at 123; see Home Orthopedics Corp. v. Rodriguez, 781 F.3d 521, 527 (1st
Cir. 2015) (“[T]he statute’s expansive reach also provides a generous private right of
action—successful plaintiffs are entitled to triple damages if they can prove they were
‘injured in [their] business or property by reason of a violation of section 1962.’” (quoting
18 U.S.C. § 1964(c)) (alteration in Rodriguez).
A successful civil RICO action requires proof of four elements: “(1) conduct (2) of
an enterprise (3) through a pattern (4) of racketeering activity.” Sedima, S.P.R.L. v. Imrex
Co., 473 U.S. 479, 496 (1985); see 18 U.S.C. §§ 1962(c), 1964(c). An enterprise may be a
legal entity like a business, a governmental unit, or a union, or it may be an informal
grouping of individuals associated in fact. United States v. Turkette, 452 U.S. 576, 580–81
(1981). However, the enterprise itself cannot be the RICO defendant. See Odishelidze v.
Aetna Life & Casualty Co., 853 F.2d 21, 23 (1st Cir. 1988) (per curiam) (“The ‘person’
alleged to be engaged in a racketeering activity (the defendant, that is) must be an entity
distinct from the ‘enterprise.’”).
4 Brownells is a registered Federal Firearms Licensed (“FFL”) dealer, which exempts it from certain laws
prohibiting the interstate shipment of firearms. See 18 U.S.C. § 922(a)(1)(A) (“It shall be unlawful for any
person except a . . . licensed dealer, to engage in the business of importing, manufacturing, or dealing in
firearms, or in the course of such business to ship, transport, or receive any firearm in interstate or foreign
commerce . . . .”). Brownells maintains a corporate shipping account with FedEx specifically for its FFL
operations. ECF No. 46-1 at 11.
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The PAC’s first fatal deficiency is that it fails to allege RICO defendants that are
distinct from the Brownells enterprise. In fact, the PAC fails to identify an “enterprise,”
and does not distinguish between Brownells the entity and any individuals who might
have criminally utilized the entity. Because the PAC treats Brownells as both the “person”
and the “enterprise,” the RICO claim fails the distinctiveness prong. See In re Lupron
Mktg. & Sales Pracs. Litig., 295 F. Supp. 2d 148, 173 (D. Mass. 2003) (explaining the
distinctiveness prong is not satisfied when “only one entity was said to have filled the dual
function of person and enterprise”).
Even if the PAC satisfied the distinctiveness requirement, the claim fails because
Ms. Cluney cannot establish proximate cause. To establish a causal connection, the
Plaintiff must show the RICO predicate offense—in this case, mail fraud—was not only
the “but for” cause of the injury but also the proximate cause. Holmes v. Sec. Inv. Prot.
Corp., 503 U.S. 258, 268 (1992). In conducting this inquiry, the Court generally does not
look beyond the “first step” of the causal chain. Hemi Grp., LLC v. City of N.Y., N.Y., 559
U.S. 1, 10 (2010).
The PAC asserts Brownells defrauded FedEx by purposefully mislabeling packages
and by failing to ship them under the name or from the address associated with
Brownells’s Federal Firearms License FedEx account. This fraud allegedly prevented
FedEx from recognizing the packages contained ammunition, which in turn caused FedEx
to fail in its duty to ascertain whether the package recipient was at least eighteen years
old. See 17-A M.R.S. § 554-B (2022) (prohibiting sale of firearms and ammunition to
minors); 18 U.S.C. § 922(b)(1) (same). Because FedEx failed to verify that Atilio Delgado
was over eighteen, he obtained the materials and was able to assemble a firearm and use
it to shoot Mr. Cluney.
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The Court finds the causal chain between the mail fraud and Mr. Cluney’s death
too attenuated to support proximate cause. The “first step” of the causation analysis—the
point where the Court must terminate its inquiry—is the fraud Brownells allegedly
perpetrated against FedEx. The direct victim of that fraud is FedEx, not Ms. Cluney or her
husband’s estate. As in Anza v. Ideal Steel Supply Corp., where the direct victim of tax
fraud was the state rather than a business competitor, the harm here is too remote from
the alleged predicate act. 547 U.S. 451, 457–58 (2006) (“The requirement of a direct
causal connection is especially warranted where the immediate victims of an alleged RICO
violation can be expected to vindicate the laws by pursuing their own claims.”). The fraud
on FedEx (the second party) merely made it easier for a third party (Atilio Delgado) to
cause harm to the Plaintiff. While FedEx might have standing to pursue a claim against
Brownells for the fraud committed against it, that standing does not impute to Ms.
Cluney.
Ms. Cluney also contends her husband’s death caused a discrete injury in the form
of the loss of an additional 384 months of his Social Security Retirement Benefits, which
would total $656,256.00, and other household contributions. ECF No. 46-1 at 123. While
the Supreme Court recently clarified that RICO does not categorically preclude recovery
for all economic harms resulting from personal injuries, see Med. Marijuana, Inc. v.
Horn, 604 U.S. 593, 613–14 (2025), the Court need not decide whether these specific
losses constitute “injur[y] [to] business or property,” 18 U.S.C. § 1964(c). Because the
proximate cause inquiry is dispositive, the nature of the damages is moot.
In sum, the allegations in the PAC are insufficient to support a RICO claim.
Because adding the RICO claim in Count 23 would be futile, the Court DENIES that
portion of Ms. Cluney’s motion.
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III. 	Other Proposed Amendments
In the Recommended Decision, the Magistrate Judge recommended: (1) reserving
ruling on Plaintiff’s request to evaluate the punitive damages claims under California and
Iowa law; (2) granting the request to substitute Federal Express Corporation for FedEx
Corporate Services; (3) granting the request to amend the factual assertions; (4) denying
the consented-to request to assert new unfair trade practices claims against Brownells;
and (5) denying Brownells’s motion for attorneys’ fees. ECF No. 57 at 14–15. The
Magistrate Judge notified the parties that failure to object would waive their right to de
novo review and appeal. The time to file objections expired on December 9, 2025, and no
objections were filed as to any portion of the Recommended Decision.
Because the Recommended Decision is non-dispositive as to the aforementioned
requests, the Court reviews those portions to determine if they are “clearly erroneous” or
“contrary to law.” Fed. R. Civ. P. 72(a). After review, the Court finds no clear error and
adopts the Magistrate Judge’s conclusions.
IV. 	Conclusion
For the reasons discussed above, the Court GRANTS IN PART and DENIES IN
PART Ms. Cluney’s Motion to Amend. ECF No. 46. Specifically, Plaintiff’s request to add
a RICO claim (Count 23) against Brownells is DENIED; the Court RESERVES
RULING on Plaintiff’s request to amend the punitive damages claims (Counts 5, 6, 11,
12, 17, and 18); Plaintiff’s request to add unfair trade practices claims against Brownells
(Counts 19, 21, and 24) is DENIED; Plaintiff’s request to amend the factual allegations
is GRANTED; Plaintiff’s request to substitute Federal Express Corporation for FedEx
Corporate Services, Inc. is GRANTED; and Brownells’s motion for attorneys’ fees is
DENIED. Accordingly, the Court AFFIRMS the Recommended Decision. ECF No. 57.
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S O ORDERED.
Dated this 19th day of February, 2026.
/s/ Stacey D. Neumann
U NITED S TATES D ISTRICT J UDGE
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