Dream, Inc. v. Samuels
Docket Number | SC-2022-0808 |
Decision Date | 23 June 2023 |
Parties | Dream, Inc., d/b/a Frontier Bingo v. Tony Samuels |
Court | Alabama Supreme Court |
Appeal from Greene Circuit Court (CV-19-900060)
Dream Inc., d/b/a Frontier Bingo ("Frontier"), operates an electronic "bingo" facility located in Greene County. Frontier refused to pay Tony Samuels $30,083.88 that he purportedly won playing electronic "bingo" at Frontier's facility. Samuels initiated an action against Frontier in the Greene Circuit Court ("the trial court") alleging breach of contract and fraud. Following a jury trial, the trial court entered a judgment on the jury's verdict in favor of Samuels, ordering Frontier to pay Samuels $500,000, and Frontier now appeals. Electronic "bingo" games however, constitute illegal gambling in Alabama. Because Alabama will not enforce an illegal transaction, either in contract or in tort, we reverse the judgment and render a judgment in favor of Frontier.
On August 1, 2019, Samuels spent approximately 8 hours at Frontier's gaming facility in Greene County, during which time Samuels wagered a total of $4,200 playing on approximately 4 different electronic gaming machines. To play electronic bingo at Frontier's facility, a player inserts funds into a game console and selects a game title to play. A player who inserts funds into a machine may play immediately and Samuels described the machines at Frontier's facility as single-player consoles with no indication that the games are played jointly with other players. The display screen of each machine has a small depiction of a bingo card, and a player may choose to "change" their bingo card prior to play. The machines, however, have the appearance of slot machines, and, like a slot machine, a player wins when certain symbols line up to form a winning line. A player may withdraw funds from a gaming machine by printing a ticket, which may be cashed out by the player or inserted into another gaming machine to transfer the funds to that machine.
Samuels testified that, after hours of playing, he accumulated combined winnings of $30,083.88. When Samuels selected the option to "cash out" on the machine on which he had been playing, however, the machine's display began flashing a blue and green color pattern, and a technician was called to the machine. The technician caused the machine to print out a "handpay ticket" indicating that Samuels had won $30,083.88. Frontier, however, refused to pay the amount reflected on the ticket, claiming that that amount exceeded the maximum payout amount and that Samuels's accumulated winnings were the result of a "malfunction."
On October 10, 2019, Samuels initiated this action, asserting a breach-of-contract claim and a fraud claim against Frontier based on its failure to pay the amount reflected on the "handpay ticket." A jury trial was conducted on March 30, 2022. The jury returned a verdict in favor of Samuels and against Frontier in the amount of $500,000, which included $250,000 in compensatory damages and $250,000 in punitive damages. On March 31, 2022, the trial court entered a judgment on the jury's verdict. Frontier filed a postjudgment motion on April 28, 2022, which was denied by operation of law on July 27, 2022. This appeal followed.
On appeal, Frontier raises a litany of challenges to the judgment. Among other reasons, it challenges the sufficiency of the evidence as to liability and damages; it contends that the judgment was unconstitutionally excessive and subject to a remittitur; and it argues that the trial court exceeded its discretion in refusing to grant a brief continuance, which it says, effectively prevented its expert witness from testifying at trial. First, however, we must address an issue not directly raised by the parties -- whether an Alabama court may aid in the enforcement of an illegal gambling contract.
"Electronic bingo is illegal in Alabama."
State v. Epic Tech, LLC, [Ms. 1200798, Sept. 30, 2022] ___ So.3d ___, ___ (Ala. 2022) (emphasis added).
Article IV, § 65, of the Alabama Constitution prohibits "lotteries," "gift enterprises," and "any scheme in the nature of a lottery" and "stands as the constitutional bar ... to slot machines and all other forms of gambling in Alabama." State v. $223,405.86, 203 So.3d 816, 834 (Ala. 2016). Notwithstanding § 65's prohibition on "lotteries," local constitutional amendments have authorized "bingo" games in various counties, including Greene County. See Amendment No. 743, Ala. Const. 1901 (now Local Provisions, Greene County, § 32-7.00, Ala. Const. 2022). In Barber v. Cornerstone Community Outreach, Inc., 42 So.3d 65, 86 (Ala. 2009) ("Cornerstone"), this Court held that the term "bingo" as used in such local amendments refers only to "the game commonly or traditionally known as bingo," which necessarily includes the following characteristics:
42 So.3d at 86. Furthermore, the above criteria apply even when a local amendment, such as Amendment No. 743, permits the use of an "electronic card marking machine" in lieu of a paper card. State v. 825 Elec. Gambling Devices, 226 So.3d 660, 671 (Ala. 2016).
In applying our decision in Cornerstone, this Court has repeatedly held that electronic-bingo machines similar to those played by Samuels in this case do not constitute "the game commonly or traditionally known as bingo" and, therefore, constitute illegal gambling. See Epic Tech, So.3d at; State v. 825 Elec. Gambling Devices, 226 So.3d at 671-72; Macon Cnty. Greyhound Park, Inc. v. Hoffman, 226 So.3d 152, 166-67 (Ala. 2016); State v. $223,405.86, 203 So.3d at 842; Houston Cnty. Econ. Dev. Auth. v. State, 168 So.3d 4, 14 (Ala. 2014); Ex parte State, 121 So.3d 337, 348 (Ala. 2013); Riley v. Cornerstone Community Outreach, Inc., 57 So.3d 704, 734 (Ala. 2010). Here, we need not address the Cornerstone factors in depth. Based on the testimony and exhibits offered at trial, the electronic-bingo machines operated by Frontier and played by Samuels clearly did not meet all the criteria set forth in Cornerstone. As such, Samuels's claims arise from illegal gambling activity.
Both parties in this case contend that Samuels's playing of the electronic-bingo machines gave rise to a gambling contract.[1] Alabama courts, however, will not enforce a void or illegal contract. In Rape v. Poarch Band of Creek Indians, 250 So.3d 547 (Ala. 2017), a case also concerning the legality of electronic-bingo games in Alabama, this Court explained:
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