Case Explained: TURREY, ET AL. V. VERVENT, INC., ET AL.

Court: United States Court of Appeals for the Ninth Circuit Filed: 2026-08-12 Docket: 3:20-cv-00697- The ninth-circuit affirmed the district court’s judgment in favor of student borrowers who sued under the Racketeer Influenced and Corrupt Organizations Act (RICO) against loan servicers involved in a fraudulent scheme regarding ITT Technical Institute loans. The court held that there was sufficient evidence for the jury to find that the plaintiffs neither knew nor reasonably should have known of their fraud-based injuries more than four years before filing suit in April 2020, meaning the claims fell within RICO’s four-year statute of limitations. Applying the “injury discovery” rule, the court determined that the clock did not start when borrowers made payments or when government investigations into ITT began, but rather when the fraudulent nature of the loans became reasonably discoverable to ordinary consumers following ITT’s public collapse and bankruptcy in September 2016. The court reasoned that complex regulatory filings and loan document irregularities did not place unsophisticated student borrowers on inquiry notice, as even sophisticated industry insiders failed to detect the fraud until the program unraveled. Additionally, the court ruled that defendants failed to preserve their challenge regarding RICO’s proximate causation requirement for appellate review because the district court’s denial of summary judgment on that issue turned on disputed factual matters and the defendants did not renew the specific challenge in a post-trial motion for judgment as a matter of law under Federal Rule of Civil Procedure 50. As a result, the twelve-million-dollar jury verdict stands, and the case is remanded to enforce the district court’s judgment. Do It For The Case Law is a news reporting service. Nothing in this episode constitutes legal advice.