Allendale Leasing, Inc. v. Stone

• Decision Date: 05 August 1985
• Docket Number: Civ. A. No. 83-518P.
• Citation: 614 F. Supp. 1440
• Parties: ALLENDALE LEASING, INC., Louise E. LeBlanc, Darlington Braves, Inc., Reali Bus Service, Inc., Northern Athletic Club v. Walter STONE, Individually and in his capacity as Director of the Rhode Island State Police; Division of State Police, and Dennis J. Roberts II, Individually, and in his capacity as Attorney General.
• Court: U.S. District Court — District of Rhode Island

614 F. Supp. 1440

ALLENDALE LEASING, INC., Louise E. LeBlanc, Darlington Braves, Inc., Reali Bus Service, Inc., Northern Athletic Club v. Walter STONE, Individually and in his capacity as Director of the Rhode Island State Police; Division of State Police, and Dennis J. Roberts II, Individually, and in his capacity as Attorney General.

Civ. A. No. 83-518P.

United States District Court, D. Rhode Island.

August 5, 1985.

COPYRIGHT MATERIAL OMITTED

Robert Mann, Providence, R.I., for plaintiffs.

Thomas Caruolo, Asst. Atty. Gen. of the State of R.I., Providence, R.I., for defendant.

OPINION AND ORDER

PETTINE, Senior District Judge.

This case is before the court on cross motions for summary judgment. The plaintiffs instituted their suit pursuant to 28 U.S.C. § 1331 and § 1343 and 42 U.S.C. § 1983, alleging that Rhode Island General Laws § 11-19-30 et seq. and certain implementing regulations violate rights secured to them by the First and Fourteenth Amendments to the United States Constitution. They also assert several pendent claims grounded in state law. The challenged provisions regulate the licensing and operation of the game Bingo or Beano and vest the state police with the power to promulgate such regulations as may be necessary to implement the statutory objectives. The plaintiffs seek an injunction prohibiting the state from enforcing these regulations, as well as monetary damages, attorney's fees and costs.

I. Background

A. The Parties

The plaintiffs challenging the Rhode Island Bingo statute represent a varied cross-section of individuals, businesses, and organizations which are somehow involved in and/or benefited by the operation of the game of chance known as Bingo or Beano hereinafter Bingo. The plaintiffs are Allendale Leasing, Inc.; Louise LeBlanc; the Northern Athletic Club; the Darlington Braves, Inc.; Reali Bus Service, Inc.; and the New England Academy of TORAH NEAT.

Allendale Leasing is a corporation which leases Bingo equipment, paraphernalia, and game facilities and conducts Bingo games for various charitable organizations. Louise LeBlanc is the owner of Allendale Leasing, and has a criminal record consisting of four misdemeanor violations of the Bingo Laws. The Darlington Braves are a charitable organization which sponsors football and cheerleading programs for youths. The Northern Athletic Club is a charity which raises funds for scholarships for North Providence High School students. NEAT is a charitable organization providing residential religious education to Jewish youths. All three organizations fund a portion of their activities through proceeds from Bingo games, and the Northern Athletic Club and the Darlington Braves lease game facilities and equipment from Allendale Leasing. Finally, Reali Bus Service provides Bingo players with transportation to and from the games.

The named defendants in this action are the Attorney General of the state of Rhode Island and Colonel Walter E. Stone, director of the Rhode Island State Police. As head of the police department, Stone is directly responsible under the Bingo statute for licensing, regulating, and supervising the operation of Bingo games and for promulgating the implementing regulations. See R.I.G.L. § 11-19-40 and § 11-19-41.

B. The Rhode Island Statute

The Bingo statute currently under attack by the plaintiffs was enacted by the Rhode Island Legislature in 1984. It supplanted a prior Bingo regulatory statute which was considerably less detailed and restrictive.¹ The new law fashions a comprehensive scheme for regulating the registration, licensing, and operation of Bingo game activities as well as for the enforcement of pertinent regulatory restrictions.

The statute, which is reproduced in full at Appendix A, establishes numerous requirements a charitable organization must meet in order to be properly registered by the state police to conduct Bingo games. R.I.G.L. § 11-19-31. It further sets forth specific conditions under which an application for registration shall be denied. Id. The statutory restrictions on the actual operation of Bingo games delineate who may participate in the game operation and what compensation they may receive; what percentage of gross game receipts may be applied to expenses; where the games may be conducted; and how frequently they may be held. R.I.G.L. § 11-19-32. The Bingo law also imposes certain limitations on the prizes that may be awarded,² and requires all organizations to maintain financial records which are to be available to the state police on demand. Id.

The Rhode Island Bingo law creates a detailed scheme for enforcing the requirements and restrictions listed above and for penalizing any violations. Under R.I.G.L. § 11-19-39 a charitable organization who willfully or knowingly violates a provision of the chapter may be subject to criminal liability. The provision also authorizes the state police to suspend or cancel an organization's registration to conduct Bingo games if it finds the organization has committed any violations, including making false or misleading statements in its registration application. Any person whose registration has been cancelled or suspended is entitled to a hearing before the department within thirty days of their hearing request. R.I.G.L. § 11-19-39(b).

The hallmark of the new Bingo law, however, is the section charging the state police with the implementation of its provisions. Section 11-19-40 instructs the director of the police department to promulgate rules and regulations that may be necessary to carry out the provisions of the chapter. In promulgating those rules, the director is to be guided by certain statutory standards setting forth conduct, conditions and activity deemed undesirable. They are as follows:

(1) Fraud: The practice of any fraud or deception upon a participant in a game of chance (2) Unsafe premises: The conduct of games of chance in, at, or upon premises which may be unsafe due to fire hazard or other such conditions;

(3) Charitable funds: To assure that all the funds raised through bingo and charitable games are maintained and expended for bona fide charitable purposes;

(4) Advertising: That advertising for all games of chance and bingo is conducted in accordance with the rules and regulations.

Since the enactment of the Bingo law, the state police have adopted regulations pursuant to their statutory mandate. Although some regulations are merely reiterations of the statute's provisions, others impose supplementary requirements and restrictions on charitable organizations, as well as on businesses engaged in the leasing of Bingo equipment and facilities. Rather than attempting to distill the contents of the regulatory compilation here, the pertinent rules will be summarily described below in the context of the plaintiffs' legal challenges.

C. Federal Constitutional Challenges

The plaintiffs bring this suit pursuant to 42 U.S.C. § 1983 seeking a declaration that a number of provisions of the Rhode Island Bingo law and certain regulations promulgated thereunder violate rights secured to the plaintiffs by the United States Constitution. Specifically, they claim that portions of the statute and regulations are unconstitutionally vague; unconstitutionally overbroad; a deprivation of the plaintiffs' First Amendment rights to freedom of expression and association; a deprivation of procedural due process; and a deprivation of their Fourteenth Amendment right to use their property in whatever lawful manner they desire.

1. First Amendment Challenges

The plaintiffs' First Amendment and overbreadth challenges are grounded in the theory that playing and conducting Bingo games is a form of expression and association that is protected activity under the Constitution. They claim that various statutory and regulatory provisions are time, place and manner regulations which unduly burden their First Amendment rights. An exhaustive explanation of each of the plaintiffs' challenges would be a prolix exercise. Summarily, however, the plaintiffs contest the validity of the following provisions:

(1) The limitation of the game expenses to 25% of gross receipts, R.I.G.L. § 11-19-31;

(2) The requirement that the game be conducted exclusively by the sponsoring organization's members, R.I.G.L. § 11-19-32;

(3) The requirement that no one involved in the management or control of the game be compensated, R.I.G.L. § 11-19-32;

(4) The limitation on the total dollar amount of the prizes that may be awarded at any single event, R.I.G.L. § 11-19-32;

(5) The requirement that a given organization sponsor no more than two events per week, R.I.G.L. § 11-19-32;

(6) The requirement that each event have only one sponsor, R.I.G.L. § 11-19-32;

(7) The requirement that the games be conducted only on premises owned or affiliated with the sponsoring organization. R.I.G.L. § 11-19-32; and

(8) The requirement that a Bingo event shall not be conducted at any single facility in excess of three times per week. R.I.G.L. § 11-19-32.

The plaintiffs also challenge a number of the rules and regulations on First Amendment grounds, some of which merely mirror statutory provisions. Others elaborate on those restrictions and still others impose incidental and supplemental restrictions regulating, for example, the sale and leasing of Bingo equipment and facilities. See e.g. Rules and Regulations, Chap. 3, § IV.

2. Void for Vagueness

The plaintiffs invoke the constitutional doctrine of void for vagueness to challenge two distinct types of statutory and regulatory provisions. The first type are restrictions containing terms such as "reasonable," "fraudulent," "fraud on the public," and "health, safety and welfare of the state." According to the plaintiffs, because these purportedly oblique terms are not more specifically defined, they are constitutionally infirm. The plaintiffs specifically attack portions of R.I.G.L. § 11-19-31 which direct the state police to deny...