A federal judge dismissed yesterday an unsuccessful bidder's $23 million lawsuit against District Cablevision Inc., the firm that was awarded the District's 15-year cable television franchise.
U.S. District Judge Thomas A. Flannery ruled that allegations of "racketeering" leveled against DCI by District Telecommunications Development Corp. were so insubstantial that its claim under the Racketeer Influenced and Corrupt Organization Act (RICO) had to be thrown out.
Flannery also dismissed fraud and unfair competition charges against DCI, but said these could be refiled in D.C. Superior Court.
"That's terrific," said District Cablevision President Robert L. Johnson when told of Flannery's decision. "It removes a cloud about the personal integrity of DCI."
Johnson said that the ruling also was "a blow against the abuse of the RICO statute. It may give us the basis to bring a countersuit . . . for this malicious prosecution."
Johnson said he expects construction of the cable TV system to begin in the spring after final negotiations are concluded with the C&P Telephone Co. The first homes should have cable service by Labor Day 1986, Johnson said, adding that the lawsuit had not delayed the project.
Harold E. Jordan, attorney for District Telecommunications, said no decision had been made on whether to appeal or to drop the racketeering charge and refile in D.C. Superior Court.
"I know my clients are pugnacious individuals," Jordan said, "and they believe in the the rightfulness of their positions . . . . This is a minor setback. But it does not end the pursuit."
The suit, filed in July, alleged that District Telecommunications would have been selected to build a cable system here if District Cablevision had not "conspired" with Tele-Communications Inc., the nation's largest cable operator, which is a shareholder in the franchise. It also said the D.C. City Council had improperly granted economic concessions after the contract award.
But Flannery ruled that the plaintiff failed to show a "pattern of racketeering activity" or even a clear injury to its business. He said the RICO statute was not intended to turn allegations of "garden variety" contract fraud into federal racketeering charges.