Virtu Financial Wins Dismissal of RICO Suit

Paul, Weiss secured a victory for Virtu Financial when the U.S. District Court for the Northern District of Illinois dismissed a RICO action brought by wireless networks technology company Skywave Networks against our client and other defendants.

Beginning in 2016, a subsidiary indirectly formed by Virtu and certain other co-defendants applied for and obtained experimental licenses from the Federal Communications Commission (FCC) to use shortwave radio technology to transmit financial market data. Skywave’s October 2024 complaint alleged that Virtu and others fraudulently obtained and used those licenses in violation of federal racketeering laws.

The defendants filed a motion to dismiss, arguing primarily that the lawsuit functioned as a collateral attack on the FCC’s exclusive authority to issue, modify and renew such licenses, and noting that the plaintiff had already advanced the same allegations in a petition for reconsideration filed with the FCC in 2023. The defendants also argued that the complaint was meritless, failed to allege the necessary elements of a RICO claim and was barred by the statute of limitations.

U.S. District Judge Georgia Alexakis agreed with the defendants’ primary argument that the court lacked subject matter jurisdiction and thus did not reach the rest of defendants’ arguments. The court concluded that the complaint constituted an impermissible challenge to the FCC’s licensing decision “dress[ed] up” as a RICO claim, dismissing the complaint and terminating the case.

The Paul, Weiss team included litigation partners Kristina Bunting, Jessica Carey, Katherine Forrest, Andrew Gordon and Robert Sperling.