This is our Response to Defendants' State Farm Mutual Automobile Co. (SFM), and State Farm Indmnity Co. (SFI), Motion to Dismiss or Stay. our initial Complaint.

In addition, we have submitted to the Court a Motion to Ammend with a Memorandum in Support of that Motion, together with an Amended Complaint. First, I've outlined the salient points as they exist in the Defendants' Memorandum.

To start at the beginning go the DIARY PAGE.


             WILLIAM C. HAMMEL,                    |
             ALAN J. BELLAMENTE,                   |
             et al.,                               |        RESPONSE
                                                   |  TO DEFENDANT'S MOTION
                  Plaintiffs                       |    TO DISMISS, OR IN
                                                   |     THE ALTERNATIVE
                   vs.                             |        TO STAY
             STATE FARM MUTUAL AUTOMOBILE          |
             INSURANCE CO.,                        |      No. 2:99:CV-44-T
             STATE FARM INDEMNITY COMPANY,         |
             et al.                                |
                  Defendants                       |


                                      TO STAY


	Since the original construction of Plaintiffs' Complaint, and even
	since the filing some six months later, conditions and
	circumstances have changed, and new information has come to light.

	An amended complaint has become necessary and is allowed under FRCP
	rule 15(a), and has been allowed by the Court's leave.

	In accordance with those conditions and circumstances, as well as
	the objections in Defendants' Memorandum in Support of Dismissal,
	Plaintiffs submit this memorandum in support of their opposition
	for dismissal of parts of their original Complaint, and matters
	addressed in that Motion for Dismissal still relevant to the
	submitted amended complaint.

	Before addressing the specifics of Defendants' Memorandum in 
	Support of dismissal, Plaintiffs cite, more generally:

	Defendants have made a Motion to Dismiss, or in the Alternative
	to Stay.  The Court is obliged under the Federal Rules of Civil
	Procedure to consider the issues in the light most favorable to
	the Plaintiffs, the nonmoving parties.
	In re Stac Elecs. Sec. Litig., 89 F3d 1399, 1403 (9th Cir, 1996);
	Doe v. Hillsboro ISD, 81 F 3d 1395, 1401 (5th Cir. 1996):
	Only if no possible construction of the alleged facts will
	entitle plaintiffs to relief should the court grant defendants'
	motion to dismiss.

	In re Hishon v. King Spalding, 467 U.S. 69, 73, 104 S.Ct.
	2229, 2232 (1984); Conley v. Gibson, 355 U.S. 41, 45046, 78 S.Ct.
	99, 102 (1957):  If the factual allegations in plaintiffs'
	complaint support any legal theory that entitles plaintiffs to
	some relief, the court should overrule defendants' motion for

	More Specifically:

	Defendants' Memorandum in Support of Motion to Dismiss, ...,
	opens with, "Plaintiffs ... have filed this action Pro Se,
	literally seeking to transform a litany of complaints about
	the handling of an automobile accident claim into a federal case
	under the Racketeer Influenced and Corrupt Organizations Act

	18 U.S.C. 1962.". (RICO)

        Plaintiffs seek no such transformation.  Indeed, State Farm Mutual
	Automobile Insurance Company, (SFM) and its progeny underwent
	their own transformation approximately 25 years ago, from the
	legitimate business of insurance to a maleficent profit center
	of racketeering.

	Plaintiffs allege that they have suffered an instantiation
	of the pattern of racketeering activities that is these Defendants'
	way of doing business, a way of doing business that has existed
	over these many years, and Plaintiffs further claim that this
	intransigent pattern of racketeering shows no sign of abatement.
	Plaintiffs also allege business, property, personal and future
	damages based on theories of RICO, State Statutes and Common Law,
	and that these damages are a result of the transactions of
	enterprises which will, in the Amended Complaint consist of
	persons named as defendants together with their various nexi
	of relationships.

	All theories and definitions of extortion exclude the case where
	the primary act is legal: to sell a thing which may legally be sold
	is obviously legal, but to do so fraudulently, and in so doing to
	create a fear of loss and attendant physical anxiety is unlawful.

	With this reasoning, Plaintiffs allege fraud both in the selling of
	an insurance policy, and in handling claims, and therefore allege
	extortion in that Plaintiffs were unreasonably and fraudulently
	denied benefits of the insurance policy, and had no recourse but
	willingly to enter litigation, first on the State level merely
	for performance of contract and then on the Federal level to
	recover damages from both the induced fear, and the development and
	realization of that which was feared, thus depleting the benefits
	to which Plaintiffs were legally entitled.  Plaintiffs have indeed
	experienced the fear of deprivation in their loss of: business and
	property; inability to earn income; bodily functions; their existence
	as normally independent and productive individuals, peace of mind
	requiring medication and psychotherapy and realizations of their
	well founded fear.

	Plaintiffs allege that the trauma, both physical and psychological,
	deliberately inflicted on Plaintiffs is no less than that which
	would be normal under  The Spanish Inquisition, and that it is
	enough to have caused permanent and disabling, business,
	property, physical and psychological damage.

	In Campbell v. State Farm Mutual Automobile Insurance Co.,
	No. 890905231, slip op. at 53 (Third Judicial Dist., Salt Lake
	City, Utah, Aug. 3, 1998), a third party action on grounds of
	Bad Faith, the Court found ample evidence for its racketeering

	Plaintiffs reference here their accompanying Memorandum On
	The Racketeering Nature Of State Farm's Misconduct.

	Thus, there exists reason for Plaintiffs allegements of these three
	aspects required in RICO; to amass and present the thousands of
	pages of evidence within such a short time to prove the existence
	of these aspects would be unduly burdensome on Plaintiffs,
	unnecessary according to the Federal Rules, at this early stage
	of pleadings, and burdensome to the Court.

	While SFM and State Farm Indemnity (SFI) are legally distinct
	entities, each, under corporate law and under RICO, entitled
	to personhood, they confuse themselves in practice, as the
	correspondence, internal documents of SFM and SFI, and pleadings
	in the New Jersey matters will show.  Each engages itself in the
	affairs of the other.  Given this, it is unlikely that the
	misconduct of SFI is inherently different from that of SFM.

	Regarding Defendants' arguments that this case should be dismissed,
	which may be outlined as:

	I. Plaintiffs have settled and dismissed their Claims
	   against State Farm

	   Plaintiffs' action is barred by two fundamental legal
	   doctrines: accord and satisfaction and res judicata.

	II. Plaintiffs have failed to state a RICO claim.
		Must allege:
		(1) that defendant (2) through the commission of two
		acts (3) constituting a pattern of (4) racketeering
		activity (5) directly or indirectly invests in, or
	        maintains an interest in, or participates in (6) an
	        "enterprise," (7) the activities of which affect
	        interstate or foreign commerce 18 U.S.C 1962(a)-(c).

	    (A) Plaintiffs lack standing under RICO because they have not
	        alleged injury in their business or property.

	    (B) Plaintiffs have failed to adequately plead predicate
	        criminal acts.

	    (C) Plaintiffs have failed to plead a "pattern" of "racketeering."

	    (D) Plaintiffs have not plead a RICO "enterprise".

	    (E) Plaintiffs RICO claim should be dismissed.

	III.  In the alternative, this action should be Stayed

                 pending the outcome of the
		"limited issue of underinsured motorist benefits."

	Plaintiffs address I. and III. here, referencing this outline,
	while II. is addressed by the substance of the amended complaint,
	except for Defendants' quoting in II-D that "that a 'person'
	is not distinct from an 'enterprise' when a corporation and its
	wholly owned subsidiary are involved."

	Defendant's specific arguments for dismissal can be divided into
	two classes, those of law and those of legal form.  The arguments
	based on form are reparable, and Plaintiffs submit that such repair
	is present in their Amended Complaint.


	Regarding Defendants' arguments for dismissal which are the
	legal doctrines of Res Judicata, Accord and Satisfaction, and
	a principle of Comity:

			   Regarding Res Judicata

	Defendants apparently intend Res Judicata in its restricted
	sense of issue preclusion or collateral estoppel, while many
	courts understand it to include both issue preclusion and claims
	preclusion.  Plaintiffs will address Res Judicata in its broader
	understanding, as the Fourth Circuit has, and relate it to this

	Following In Re Varat Enterprises Inc., 81 F.3d 1310
	(4th Cir. 1996), where this broader analytical position is taken;
	from In Re Varat, excluding footnotes:
        	"Under res judicata principles, a prior judgment
		between the same parties can preclude subsequent
		litigation on those matters actually and necessarily
		resolved in the first adjudication. See Restatement
		(Second) of Judgments, '' 13 et seq. (1982);
		Allen v. McCurry, 449 U.S. 90, 94 (1980);
		Federal Deposit Ins. Corp. v. Jones,
		846 F.2d 221, 234-35 (4th Cir. 1988). The doctrine
		encompasses two concepts: claim preclusion and issue
		preclusion, or collateral estoppel.  Allen, 449 U.S.
		at 94. Rules of claim preclusion provide that if the
		later litigation arises from the same cause of action
		as the first, then the judgment bars litigation not
		only of every matter actually adjudicated in the
		earlier case, but also of every claim that might
		have been presented. Nevada v. United States,
		463 U.S. 110, 129- 30 (1983); Wallis v. Justice Oaks
		II, Ltd. (In re Justice Oaks II, Ltd.), 898 F.2d 1544,
		1549 n.3 (11th Cir.), cert. denied, 498 U.S. 959 (1990).
		Issue preclusion is more narrow and applies when the
		later litigation arises from a different cause of
		action. Nevada, 463 U.S. at 130 n.11. It operates
		to bar subsequent litigation of those legal and
		factual issues common to both actions that were
		'actually and necessarily determined by a court of
		competent jurisdiction' in the first litigation.
		Montana v.  United States, 440 U.S. 147, 153 (1977);
		Combs v. Richardson, 838 F.2d 112, 114 (4th Cir. 1988)."


		"Generally, claims are part of the same cause of
		action when they arise out of the same transaction
		or series of transactions, Harnett v. Billman,
		800 F.2d 1308, 1314 (4th Cir. 1986), cert.  denied,
		480 U.S. 932 (1987), or the same core of operative
		facts, Heritage Hotel, 160 B.R. at 377-78."


	Also, from Black's Law Dictionary 6th Edition:
		res judicata ---- A matter adjudged; a thing judicially
		acted upon or decided; a thing or matter settled by
		judgment. Rule that a final judgment rendered by a court
		of competent jurisdiction on the merits is conclusive as
		to the rights of the parties and their privies, and, as
		to them, constitutes an absolute bar to a subsequent
		action involving the same claim, demand or cause of
		Matchett v. Rose, 36 Ill.A;.3d 638, 344 N.E.2d 770, 779.
		And to be applicable, requires:

		   identity in thing sued for
			as well as
		   identity of cause of action,
		   of persons and parties to action,

		   and of quality in persons for or against
	 	   whom claim is made.

		The sum and substance of the whole rule is that a
		matter once judicially decided is finally decided.


		"The federal Courts have traditionally adherered to
		the related doctrines of res judicata and collateral
		estoppel.  Under res judicata, a final judgement on
		the merits of an action precludes the parties or their
		privies from relitigating the issues that were or
		could have been raised in that action."
		Allen v. McCurry, 449 U.S. 90, 101 S. Ct.
		411, 415, 66 L.Ed.2d 308.

	Generally, claim preclusion occurs when three conditions are

	 1) the prior judgment was final and on the merits, and rendered
            by a court of competent jurisdiction in accordance with the
            requirements of due process;

         2) the parties are identical, or in privity, in the two actions;

         3) the claims in the second matter are based upon the same cause
            of action involved in the earlier proceeding.
            Kenny v. Quigg, 820 F.2d 665, 669 (4th Cir. 1987);
            see also Justice Oaks, 898 F.2d at 1550
            (listing the same criteria as four elements).
	   "Generally, claims are part of the same cause of action
	   when they arise out of the same transaction or series of
	   transactions", Harnett v. Billman, 800 F.2d 1308, 1314
	   (4th Cir. 1986), cert. denied, 480 U.S. 932 (1987), or
	   the same core of operative facts, Heritage Hotel,
	   160 B.R. at 377- 78.

	The transactions among and between the Defendants acting
	within a RICO enterprise do not concern the matter of
	Plaintiffs' specific insurance claims treated in the New
	Jersey matters, any more than a specific allegation of fraud
	or bad faith is concerned with an insurance claim itself.
	In Christiansen v. First Insurance Company of Hawai'i Ltd.,
	et al., Intermediate Court of Appeals, No. 19968, on appeal
	from the Fifth Circuit Court, Civ. No. 93-0238, the Court
	Held that Bad Faith and Breach of Contract are torts outside
	of an insurance policy in a first-party action, and are
	therefore not bound by any limitations or agreements of
	the policy.
	The body of law that governs insurance policies is the
	insurance law of the State, while, generally, Bad Faith
	and Breach of Contract are not insurance law.
	When all of the requirements for claim preclusion are
	satisfied, the judgment in the first case acts as an
	absolute bar to the subsequent action with regard to
	every claim which was actually made and those which might
	have been presented. Justice Oaks, 898 F.2d at 1552.
	Yet, here, the requirements for claims preclusion are
	not met in this action.

	The Joined State Cases have SFI as sole defendant, while the
	Defendants in this single Federal action have additional
	Defendants who are altogether related through their activities
	within enterprises and schemes.

	It must be understood that were it not for the MVA of
	September 16, 1994, Plaintiffs would not have been exposed
	to an already existing pattern of racketeering activities
	of SFM that masquerades as "claims handling", nor would
	they have been immediately exposed to the very same pattern
	exhibited by SFI, and, in all probability by the entire
	"family of State Farm Companies", since they all seem bear
	the same relation to SFM as does SFI, being wholly owned
	incorporated subsidiaries.

	The claims, here, arise from patterns of racketeering activities
	and violations of Statutes and common law of the State of
	North Carolina, and not from an MVA, nor any lawful handling
	of claims.
	Plaintiffs complain, in part, in this Federal action, of the
	behavior and tactics of State Farm Indemnity (SFI) in New Jersey
	and those of SFM in North Carolina within the very litigation
	process itself.  Since the subject matter of of a given action
	cannot be the action itself, it is clear that the two joined
	State actions and the single Federal action do not have the
	same subject matter.
	Plaintiffs do not complain here of injuries sustained in the
	accident, but rather of those injuries and their permanency
	that arise from transactions within RICO enterprises that
	include specific tactics of denials and delays of legitimate
	claims; persistence in such denials and delays in the face of
	an illegitimacy and illogic that has been repeatedly brought
	the attention of Defendants SFM and SFI.

	Plaintiffs refer here to their
	Memorandum on Causality and Damages.

        1) The only remedies available to Plaintiffs by law in the
	   State of New Jersey are those of performance on an insurance
	   policy.  The cause of action in New Jersey is then,
	   necessarily, nonperformance under terms of the policy, and
	   the New Jersey claim is only for performance.  The language
	   of the New Jersey complaints was in substantive error and
	   at odds with existing State Law.  Although New Jersey law
	   apparently does not explicitly forbid remedies other than
	   performance in PIP actions, they do not exist, in fact, and
	   are not supported by statute, nor were they supported by a
	   body of case law.

	   The expanded remedies available to Plaintiffs under Federal
	   Law, are based on criminal acts.  Nonperformance is not,
	   per se, a criminal act.  The causes of action in this Federal
	   action arise from the nexus of criminal acts discovered
	   subsequent to nonperformance.  The claims are then damages
	   resulting from these causes of action.

	   Therefore, between the New Jersey State actions and the
	   Federal action, the claims as well as the issues or causes
	   of action are distinct.

        2) The original separate complaints against State Farm, filed
	   in New Jersey in October of 1996 did contain allegations
	   of Bad Faith and demand for punitive damages; the Court
	   dismissed the punitive damages on April 18, 1997, on grounds
	   of the unavailability of the punitive damages by Statute
	   under New Jersey law.  These issues were moot even before
	   the complaints were filed, and dismissal was not based on
	   the merits.  At issue was whether or not punitive damages
	   were available under New Jersey Law.  In raising the issue
	   of Bad Faith in in Federal District Court, Plaintiffs do
	   not seek to enhance the Statutory Law of New Jersey, but
	   seek to avail themselves of available Statutes and Common
	   Law under North Carolina Law, which are different claims

	   Plaintiff Hammel notes that at the time of dismissal of
	   punitive damages specifically under PIP actions, the court
	   granted Plaintiff's attorney's Cross Motion to amend the
	   complaint for Compensatory damages in place of Punitive
	   damages, in recognition of the nonexistence of the punitive
	   damages of Bad Faith, and the possible existence of
	   compensatory damages.

	   While this action alleges criminal acts, neither of
	   Plaintiffs' New Jersey complaints so allege.

	   An action for performance under an insurance policy pursuant
	   to the policy and State insurance laws is hardly equivalent
	   in claims or issues to a Federal action spanning three States
	   and alleging a racketeering enterprise that continues by
	   deceit and trickery over a period of approximately five years
	   to the continuing and now unstoppable detriment of both

	   Therefore, Res Judicata should not be applied on the basis of
	   these dismissals of punitive damages under PIP in the State
	   of New Jersey.

        3) The application of Res Judicata, in this action, would
	   require that Plaintiffs are only now raising issues that they
	   could have raised properly under New Jersey State Law.

		a) Clearly, raising the issue of Bad Faith was not properly
                   available to Plaintiffs in New Jersey, and although
		   tortious, Bad Faith is not criminal.

		b) Equally clearly, issues of federal RICO violations could
		   not have been raised, because a State Court is not
		   competent to hear such issues, especially when no State
		   RICO statute is available; New Jersey does not have a
		   RICO statute as do, e.g., Nevada and North Carolina,

	   Therefore Res Judicata should not be applied to this action
	   in a plenary manner.

	4) The cause of action is not being split here, since the causes
           of action in the matters in New Jersey arose under an insurance
	   policy and are exactly matters of performance; put another way,
	   they arose seminally from the purchase of an insurance policy
	   as a single continuing transaction between Plaintiffs and,
	   originally State Farm Mutual Automobile Insurance Co., and
	   then State Farm Indemnity Co., terminating in March 1996,
	   after many years.

	   Here, the causes of action arise from a series of transactions,
	   involving the Plaintiffs and Defendants of the
	   Amended Complaint, in which Plaintiffs allege a nexus of more
	   than sufficiently many violations of RICO within the
	   enterprises of associations between these Defendants,
	   to warrant RICO standing.

        5) Between the joined New Jersey matters and this action,
	   Plaintiffs argue:

		a) The causes of action
			i)   have different Defendants
			ii)  have different time frames
			iii) involve different acts yielding new evidence
			     since the first filing of Plaintiffs'

		b) The issues are distinct

		   Issue preclusion applies only to issues actually and
		   necessarily resolved in the first case.  The only
		   issue of fact and/or law decided by a competent court
		   of jurisdiction in the NJ matters was that punitive
		   damages were not available under PIP actions in New
		   Jersey.  This was a matter of a paucity of case law
		   and statute, and not decided on the merits.

		c) Neither the PIP releases nor the Judicial Orders
		   in New Jersey decide or resolve any issue of Plaintiffs'
		   current action.  Moreover, Plaintiffs allege in their
		   amended complaint that SFI entered the contract
		   that is the release, with the same fraudulent intent
		   and behavior that it had previously exhibited, making
		   that contract now an issue of controversy in the amended

		d) The Court in the NJ matter lacks jurisdiction over
		   over the claims in this Federal action; and, Plaintiffs
		   would be prejudiced in their theories and remedies in
		   this action, being denied due process in presenting
		   their evidence and claims, if Res Judicata were applied.

		e) Res Judicata does not act as a bar when the conduct
		   giving rise to the later suit post-dates the conclusion
		   of the first suit. [Restatement (Second) of Judgments
		   24 cmt. f (1982)].  Defendants argue that somehow an
		   issue has been resolved in PIP which acts to bar
		   this Federal action.  Plaintiffs present claim is further
		   based on acts post-dating the fraudulent PIP settlement
		   which reflects back on the understanding of intent in
		   actions prior to the central post-dated acts.

		f) Moreover, Defendant SFI through its attorney, Melli
		   have, in writing, already claimed that in its PIP
		   settlement, has "admitted nothing" regarding its
		   liability in its PIP settlement.  Therefore the matter
		   of SFI's liability is, according to SFI still open
		   and not at all resolved.  If that is not at all
		   resolved than the central PIP question of liability
		   and whether Plaintiffs have been properly indemnified
		   is still open, despite Plaintiff's expectations to,
		   and understanding of, the contrary.

	Therefore Res Judicata should not be applied to bar this action.

			Regarding Accord and Satisfaction

	The signed PIP releases have already been submitted to the Court
	through the affidavit of Michelle Wall, allowing Plaintiffs to
	discuss them without separate submission.
	Though an insurance policy is a contract of adhesion,
	a settlement agreement entered into freely by both parties
	is an agreement of a standard contractual nature.
	These releases have all the required elements of a contract.

	1) These releases were signed under physical and emotional
	   duress as well as a coercion of fact that the PIP case
	   must be settled before action on UIM could be taken.
	   Defendants have exploited both this circumstance and
	   Plaintiffs' fear of yet further damaging delays in
	   receiving even the smallest amount of money due them
	   under the terms of the policy.
	2) These releases were understood by Plaintiffs as specific
	   releases in consideration for PIP payments, some of which
	   had been then recently, suddenly and inexplicably made
	   before the fact.
	   Said payments by SFI, made without further medical investigation,
	   since SFI declined medical investigation after Plaintiffs'
	   cervical surgeries, and at the time of Plaintiffs' depositions,
	   can be, and were understood by Plaintiffs and their attorneys
	   as admission that these payments should have been paid without
	   the necessity of litigation.
	   If payments are not made over a period of years, they are not made

		1) the claims are determined not to be real

		2) the damage is not covered by the policy

		3) the insurer is seeking profit by retaining money

		   due the claimant

		4) the insurer is being malicious

		5) the insurer is being capricious and arbitrary

	   or any combination of these.  In cases 1) and 2), the insurer has
	   an obligation to investigate fraud, or state and prove the damage
	   not to be covered.  The rest are unlawful.
	   When an insurer suddenly after these 4 years pays bills, and
	   maintains that it has not acted unlawfully, then it
	   automatically waives cases 1) and 2), for these are assertions
	   that should have been made and resolved years ago.  Defendant
	   SFI should be barred from maintaining any other reason than it
	   had "no reason" for denial, by the principle of equitable
	   estoppel.  Any legitimate reason should have been raised long
	   ago.  The only excuses given are the invalid ones given in
	   the initial denial letters.
	   In the case of Plaintiff Hammel, the single denial was based
	   on the statement that "in the doctor's opinion, no further
	   treatment was necessary"; it was accompanied by Doctor Linder's
	   second IME report in which no such opinion was expressed
	   directly or indirectly.  Communications, immediately upon
	   receipt and numerous times thereafter by Plaintiff Hammel
	   on this point, were ignored.  The first response was by
	   Savastano in a telephone conversation with Plaintiff
	   Hammel on or about July 31, 1995; when questioned on the
	   denial of medical benefits said, "Don't worry, it's just a
	   formality", a statement upon which Plaintiffs relied.
	   Thereafter, there was no response to the point, nor has
	   there been any since.  What Defendant SFI did was wait
	   until the second suggested time of treatment had expired
	   and then issued a denial letter without requesting the
	   appropriate IME.

	   Then fifty-six (56) days later, SFI sent an IME request letter,
	   with the usual threats of denial of benefits for failure to
	   comply.  The IME was with Dr. Harry Merliss, and orthopedic
	   surgeon.  Plaintiff Hammel had not yet seen an orthopedist
	   of any kind yet.  The provisions of the policy provides that
	   SFI might from time to time seek second opinions, which this
	   clearly was not.  After Plaintiff Hammel had actually made an
	   appointment with Dr. Merliss, he discovered through contacts
	   in the medical profession that Dr. Merliss was, in fact, a
	   medical whore who sold his a priori "medical opinions" to
	   insurers.  Plaintiff Hammel, promptly canceled his appointment
	   with Dr. Merliss and reported to SFI that Merliss was
	   unacceptable as an IME physician.  It was then clear what
	   SFI was attempting to do.  Plaintiff Hammel had read and
	   understood similar purpose in IME reports by Drs. Fremed and
	   Wagle, and thereafter investigated any IME physician declared
	   by SFI, finding the same continuing pattern.
	   In the case of Plaintiff Bellamente, Defendant SFI sent two
	   denial letters for neurological and psychological benefits.
	   These letters, on which the decisions to deny were based,
	   were secured through unlawful means.  No letter of denial
	   of chiropractic benefits was ever sent, SFI simply,
	   unlawfully, refused to pay for Plaintiff Bellamente's
	   necessary and continuing chiropractic care.
	   Defendant SFI conspired with both IME physicians Fremed
	   and Wagle to commit extortion upon Plaintiff Bellamente
	   by having him attend sham IMEs; conspired to commit
	   extortion on Plaintiff Bellamente by having sham IME
	   reports written to present as excuses for depriving him
	   of benefits due a legitimate claimant.
	   Since this denial was indeed effected, Defendants SFI,
	   Fremed and Wagle did coerce Plaintiff Bellamente into
	   attending these IMEs, they have committed extortion.
	   Since the IME reports were written and used as excuses to
	   deny benefits, and benefits were denied, they have also
	   committed robbery in depriving him of the benefits due him,
	   which has caused grievous and permanent damage to his business,
	   property and person.
	   Defendants SFI, Fremed and Wagle have also committed conspiracy
	   to commit fraud through the conspiracy to purport that the IMEs
	   were indeed "independent medical examinations".
	   These same Defendants have committed fraud upon Plaintiff
	   Bellamente by purporting that the IMEs were indeed
	   "independent medical examinations", upon which Plaintiff
	   Bellamente relied, to his detriment by having his benefits
	   denied through this scheme of unlawful acts.
	   The Accord of the PIP releases is understood by Plaintiffs
	   to cover the PIP claims and only the PIP claims, which SFI
	   is to satisfy.  Any understanding of satisfaction by
	   Plaintiffs regarding the Accord is based on Plaintiffs'
	   Good Faith and Reasonable Expectations that satisfaction will
	   be met in the future.  In reality, such satisfaction has not
	   been met, in that, out of pocket expenses for which bills have
	   been repeatedly submitted, have not yet been paid or even
	   acknowledged, and Plaintiffs see little chance that they will be.
	3) Since the signing of these release contracts, SFI has been
	   in default of their agreement, exactly as they were in
	   default of their agreement under the so called insurance
	   policy and remain in breach of their fiduciary duties that
	   extended through the arduous litigation process which was,
	   and still is, highly destructive to Plaintiffs.  Only after
	   service of the RICO complaint, was there some attempt to
	   make good appearance of SFI's word in these releases by
	   what appeared to be an unconvincing kind of deathbed
	   There was a prior attempt by Michelle Wall to settle the
	   PIP matter in a letter to both Plaintiffs' attorneys dated
	   November 19, 1998, but for some reason that could only have
	   its origin in edict by SFI, this attempt suddenly came to a
	   halt.  On information and belief Carole Rickelmann of SFI's
	   Complex Claims Unit was involved in this malicious edict.
	4) The consistency with which SFI has dishonored its word in
	   policy, fiduciary duty and agreement leaves very little
	   doubt that these releases, as contracts, were entered into
	   with no intent other than to continue their racketeering
	   Plaintiffs question whether they should be bound by their
	   agreements to these releases, since SFI has behaved in a
	   manner indicating that it assumed it was not so bound.
	   In being so bound Plaintiffs are being punished for Good
	   Faith, while SFI is being rewarded for its racketeering
	5) Under the doctrine of Reasonable Expectations, Plaintiffs
	   had been insured by State Farm insurance since 1986, and
	   had minor claims, and none with liability - plaintiffs
	   had reasonable expectations of being insured, and of the
	   policy being honored; Plaintiffs at all times behaved
	   prudently, and accordingly, were completely surprised at
	   SFIs, behavior.
	6) SFI, agreed to considerations in releases in order to
	   secure dismissal of the PIP actions.  SFI paid Plaintiffs'
	   Medicaid liens and outstanding medical bills, even before
	   the releases were signed, tacitly acknowledging that said
	   PIP payments were legitimate, that the denials of all medical
	   benefits was improper, and therefore that it had failed in

	   After securing Plaintiff Hammel's release and paying his
	   PIP claims, SFI then sought to relitigate the causation of
	   damages from the MVA by procuring a "paper review" of
	   Plaintiff Hammel's medical reports which comes to the not
	   very surprising conclusion that the MVA caused no damages
	   at all.  This review written by SFI's espoused expert
	   witness Eric L. Fremed, M.D. for a UIM arbitration, arrives
	   at his conclusion by contrived selections and omissions from
	   every medical report stated to have been reviewed, and by
	   wholly ignoring those from which nothing that suited his
	   purpose could be harvested.  It takes no great medical
	   expertese, in comparing Dr. Fremed's Reviews with the actual
	   medical reports of Plaintiffs' treating physicians, and with
	   the objective radiological reports, to see that these
	   reviews are complete fabrications in furtherance of the
	   continuation of SFI's egregiously privative actions.
	   Its statements and reasoning are a farce of ridiculous
	   proportions.  That such a Review could be constructed
	   without the direct or indirect coaxing by SFI would
	   stretch anyone's credulity.  Dr. Fremed was paid
	   approximately $1000.00 for these reviews according to
	   SFI's internal records.

	   Referenced here is Plaintiffs' accompanying Memorandum On
	   Medical Paper Reviews and an IME Report by Defendant Eric
	   L. Fremed.
	   In principle, these reviews should be barred in the New
	   Jersey Courts on the basis of equitable estoppel.  These
	   objections notwithstanding, the purpose of Defendant SFI
	   was further delay, and denial of benefits of the policy
	   that should have been paid years ago, and furtherance of
	   fraud and the pattern of racketeering, which is perfectly
	   consistent with SFI's prior behavior and tactics.
	   One Review by Dr. Fremed even extends to an unwarranted ad
	   hominem, medically unprofessional and legally inappropriate
	   attack on Plaintiff Hammel.

	   In the other review of Plaintiff Bellamente's medical records,
	   the same conclusion that no injuries were caused by the MVA
	   is reached.  Dr. Fremed has an advantage here, however, since
	   he is the neurologist to whom SFI sent Plaintiff Bellamente,
	   in order to obtain an excuse to deny neurological benefits.
	   Dr. Fremed seems not to agree with any treating physician.
	   The Complaint sent to the New Jersey Department of insurance,
	   details Dr. Fremed's alleged 15 minute neurological examination.
	   For these reasons, Dr. Fremed and his P.C. have now also
	   been included as named Defendants in this RICO action,
	   separately and as agents, servants and/or employees of SFI,
	   as has SFI's other co-conspirator Dr. Sharad Wagle, and his P.C.
	7) These releases were understood by Plaintiffs as contracts
	   for future performance.  Defendant SFI has already indicated
	   fraudulent intent regarding performance in two matters:
	   regarding payment of out of pocket medical expenses, in the
	   matter of Plaintiff Hammel's contract (release) leaving future
	   performance reasonably not to be expected; and regarding their
	   attempted switch in position on the attribution of injuries
	   to the MVA.  This violates intent and understanding of the
	   release, and is an exercise in trickery and deceit in
	   furtherance of the pattern of racketeering.

	8) Regarding 5(f) under Res Judicata, the stated position of
	   defendant SFI is, now, after the fact of the PIP settlement
	   that SFI has admitted nothing and apparently paid some medical
	   bills for some capricious reason unknown to Plaintiffs or their
	   NJ attorneys.  In this action, can the accord be considered
	   satisfied, as it had, not, according to SFI, anything to do
	   with the requirement of the policy, but is now supposed to be
	   understood as some arbitrary act, by SFI's own assertion,
	   through its attorneys, Melli, for which Plaintiffs are now
	   supposed to obey and be satisfied, according to whatever
	   interpretation SFI attributes to this act at any particular
	   moment.  The legal concept for this is "tortious interference
	   with contract."

	Therefore, the principle of Accord and Satisfaction should not
	be applied to bar this action.

                                Regarding Comity

	Given the above arguments disputing the applicability of
	Res Judicata, in all of its requirements, the question of
	Comity cannot arise; if it could, in such a case, no Federal
	law would be permitted to exist that covers any area
	of law where a State law also covers that area.  From a
	legal standpoint, this is an untenable extreme solution to
	the problems of localism conflicts.  To Plaintiffs'
	knowledge, this extreme solution had not been accepted or
	adopted by any Court of the United States.

	II.   Addressed in Plaintiffs' Amended Complaint
	      Except for D, which Plaintiffs now address.

	1) In Defendant's Memorandum, they note failure on the part
	   of Plaintiffs properly to distinguish between SFM and SFI,
	   make a few assumptions and then cite  NCNB: National Bank
	   of North Carolina v. Tiller, 814 F.2d 931, 936 (4th Cir. 1987),
	   as holding "that a 'person' is not distinct from an
	   'enterprise' when a corporation and its wholly owned subsidiary
	   are involved."

	   This confusing and vague quote creates even more confusion
	   when followed through to the actual case, and was ultimately
	   misapplied there:

		a)  In NCNB, the Court was actually quoting the Court's
		    opinion in U.S. v. Computer Sciences Corp, 689 F.2d,

		b)  In NCNB, Appellee NCNB was an UNINCORPORATED
		    subdivision of Appellee NCNB Corporation.

		c) In Computer Sciences, once again Infonet is an
		   UNINCORPORATED division of CSC.

		d) In Computer Sciences, 1190 [13] the Court opines:

		   "There is, however, the remaining problem, restricted
		    to CSC, of whether Congress ever intended, in
		    18 U.S.C. 1962, that the statute prohibit activities
		    by a person where the activities are described
		    as occurring with any enterprise when there was
		    identity between the person, on the one hand,
		    and the enterprise, on the other.  We conclude that
		    'enterprise' was meant to refer to a being different
		    from, not the same as or part of, the person whose
		    behavior the act was designed to prohibit, and
		    failing that, to punish.  To be sure, the analogy
		    between individuals and fictive persons such as
		    corporations is not exact.  Still, we would not
		    take seriously, in the absence, at least, of very
		    explicit statutory language, an assertion that a
		    defendant could conspire with his right arm, which
		    held, aimed and fired the fatal weapon.  A
		    corporation, in common parlance, is not regarded
		    as distinct from its unincorporated divisions either."

		e) In Computer Science the Court maintained that the
		   "person" under RICO must always be different or
		    distinct from the "enterprise".

		e) However, in Busby v. Crown, the court reverses itself
		   allowing that under an allegement of 1962(a)
		   the person and the enterprise may be identical, while
		   maintaining the requirement that the enterprise and
		   person must be distinct under allegement of 1962(c).

		f) In Busby, the Court notes that the distinction between
		   enterprise and person is followed by all Circuit
		   Courts excepting the 11th Circuit; U.S. v. Hartley,
		   678 F.2d 961, 987-90 (11th Cir. 1982).

	   In summary, as Defendant's state, in allegements of 1962(c),
	   the person must be distinct from the enterprise; however, in
	   allegements of 1962(a) they may be identical.

	   Plaintiff's have already alleged and do so again in their amended
	   complaint that SFI is an INCORPORATED wholly owned subsidiary
	   of SFM.  The citation prohibiting the separation of person
	   and enterprise "when a corporation and its wholly owned
	   subsidiary are involved" is taken, in both Computer Sciences
	   and in NCNB, out of the context of the issue of unincorporated
	   wholly owned subsidiaries.

	   In common corporate parlance "wholly owned subsidiary" is
	   understood as incorporated, so it is easy to see how, without a
	   careful reading of the issues in NCNB and Computer Sciences,
	   the unfortunate phraseology of the Court might be misinterpreted.

	   In Busby and NCNB, the Courts do not find that a 'person'
	   is not distinct from an 'enterprise' when a corporation and
	   its incorporated wholly owned subsidiary are involved.
	   The issue is one of the degree of separateness of person
	   as defined 18 USC 1961(3), "includes an individual or
	   entity capable of holding a legal or beneficial interest
	   in property".  Any holding or possession of an unincorporated
	   wholly owned subsidiary of a corporation is, per force, the 
	   property of the corporation.  The unincorporated subsidiary
	   is not a legal person and is not capable of holding a legal
	   or beneficial interest of its own, exclusively, being too
	   closely bound to the corporation itself.  An incorporated
	   wholly owned subsidiary, however, has by law, the normal
	   sense of person and is indeed legally capable of holding
	   a legal and beneficial interest in property.

	   Therefore, Defendant's have misinterpreted and misapplied
	   this aspect of the Courts' holdings in NCNB, and Computer

	III.  Regarding Defendants' Alternative Motion to Stay

        1) Should compensatory damages actually be awarded in the
	   remaining UIM matter, they would only be a compensation for
	   the pain and suffering endured by Plaintiffs during the
	   time of protraction in performance of Defendant SFI, and
	   not compensation sought here for permanent business,
	   property and bodily losses, and their consequential damages,
	   which will continue until Plaintiffs' demise.
	   The claims and relief sought here are distinct from those sought
	   in the New Jersey State actions brought under State Insurance
	   Law.  There is no attempt to relitigate the same claims, nor
	   do Plaintiffs seek double recovery.  Plaintiffs have not, however,
	   been made whole.  Quite the contrary, and it is this for
	   which compensation is sought.  The RICO patterns defined in
	   this federal complaint, are the cause of permanent damages
	   to both Plaintiffs.  Since the business and property of both
	   Plaintiffs are also by law, personal, the formal restriction
	   to business and property extends by law to personal damages.
	   Plaintiff Hammel was, at the time of the MVA, engaged in
	   businesses that were d/b/a's, meaning that legally, his
	   business was indeed personal.  Plaintiff Bellamente was
	   engaged as conservator of an elderly aunt's estate; his business
	   was then also purely personal.  So, in this particular case the
	   usual distinction between "business and property" damages and
	   personal damages does not apply.

	   By reference, the accompanying Memorandum on Causality and Damages.
	   is included in entirety with all of it paragraphs.

	   This Federal action is distinct from the two joined matters in
	   New Jersey.

	   Should SFI give Plaintiffs reason by their further behavior in
	   litigation in New Jersey, Plaintiffs will supplement this
	   Federal complaint.

	2) Nothing that may be resolved in the New Jersey matters will
	   have meaning here, excepting that one pattern alleged may
	   have changed its status from open to closed.  The only other
	   consequences of not staying this action in regard to the
	   New Jersey matters are that Plaintiffs may be forced to
	   submit supplements to the complaint.

	3) To stay this action pending the outcomes in New Jersey would
	   give SFI direct control over delays in this Federal
	   Court.  SFI has successfully delayed the New Jersey claims
	   for five years, and the cases for three years using the
	   very same tactics outlined in Campbell and independently
	   in Plaintiffs' Complaints to the New Jersey Department of
	   Insurance.  SFI's "investigations" of Plaintiffs' claims
	   will be shown to be mere shams and fabrications, whose sole
	   intention was and is to deny Plaintiffs that to which they
	   have rightful claim, and that these shams are patterns of
	   racketeering masquerading as "claims handling".

	4) It would be intolerable for any RICO enterprise to be given
	   permission by the Court to prevent, interfere with, or delay,
	   indeterminately by its own activities, litigation against
	   that very enterprise.

	5) If, in Defendants' words, the issue of underinsured motorists
	   benefits are so "limited" and one assumes by inference,
	   relatively trivial, this action should not be stayed.
	   Defendants give no substantive reason why it should.

	6) No matter the UIM arbitration panel's decision, it can not
	   negate the RICO violations; nor can it negate the violations
	   of the Statutes and common law of North Carolina of which
	   Plaintiffs complain in their Amended Complaint.

	THEREFORE, neither Res Judicata nor Accord and Satisfaction,

	nor Comity, should be applied to bar or dismiss this action;

	nor should this action be stayed pending any resolution of

	the UIM arbitration in New Jersey.


	Respectfully Submitted:

        William C. Hammel                     Alan J. Bellamente
        A-11 Moose Branch Road,               A-11 Moose Branch Road,
	Sweetwater Apartments 1A,             Sweetwater Apartments 8A,
        Robbinsville, NC 28771                Robbinsville, NC 28771
        (828) 479-1547                        (828) 479-1547

                       /S/                                 /S/
        -------------------------------      ------------------------------
        William C. Hammel                     Alan J. Bellamente

        DATE: February 4, 2000                DATE: February 4, 2000

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Created: February 4, 2000
Last Updated: May 28, 2000 Last Updated: September 25, 2000