In re N. Metro Harness Initiative, LLC
| Decision Date | 03 September 2013 |
| Docket Number | A13-0033 |
| Parties | In the Matter of the Request of North Metro Harness Initiative, LLC, to Amend its Plan of Operation to Include the Use of the TMS 300 Royal Match 21 Blackjack and Royal Match Progressive. |
| Court | Minnesota Court of Appeals |
This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2012).
Affirmed
Minnesota Racing Commission
Thomas A. Keller, III, John P. Boyle, Timothy R. Franzen, Moss & Barnett, Minneapolis, Minnesota (for relator North Metro Harness Initiative, LLC)
Lori Swanson, Attorney General, Joan M. Eichhorst, Assistant Attorney General, St. Paul, Minnesota (for respondent Minnesota Racing Commission)
Considered and decided by Bjorkman, Presiding Judge; Halbrooks, Judge; and Rodenberg, Judge.
UNPUBLISHED OPINION
Relator challenges respondent's denial of its request to amend its plan of operation, arguing that (1) respondent erred by relying on an opinion from another agency, (2) substantial evidence does not support the decision, and (3) the decision is arbitrary and capricious. We affirm.
Respondent Minnesota Racing Commission (MRC) issued a license authorizing relator North Metro Harness Initiative LLC (North Metro) to conduct horseracing and card-club operations at Running Aces Harness Park. North Metro's plan of operation allows it to offer card playing, including manually dealt blackjack. On October 2, 2012, North Metro asked MRC for authorization to amend its plan of operation to include the use of TMS300 Royal Match 21 Blackjack and Royal Match Progressive (Table Master), a fully automated blackjack table.
MRC asked the Minnesota Department of Public Safety, Alcohol and Gambling Enforcement Division (Gambling Enforcement) whether North Metro's proposed use of Table Master would comply with Minnesota's gambling laws. After reviewing North Metro's request, which included a description of Table Master and its technical specifications, Gambling Enforcement determined that Table Master is a "gambling device" and "video game of chance" as defined by Minn. Stat. § 609.75, subds. 4, 8 (2012). Because North Metro is not among the entities to which a gambling device may be distributed under Minn. Stat. § 299L.07, subd. 2a(b) (2012), Gambling Enforcement opined that approval of North Metro's request would violate the law.
MRC conducted three public hearings during which North Metro provided testimony to support its request. Tracie Wilson, Running Aces Harness Park's CFO, testified that the card club currently offers two forms of blackjack. In the first, a dealer shuffles physical cards using an electronic shuffler with a random-number algorithm and manually deals the cards to players. The second form uses iTables. A dealer still uses anelectronic shuffler and deals physical cards to players. But iTables have electronic touchscreens for each player that display the value of players' cards1 and permit players to make wagers, side bets, and plays (e.g., hit or stand). The iTable electronically determines the winners of the hand and distributes electronic credits accordingly.
Wilson explained that Table Master is a fully automated blackjack table. Table Master does not involve a human dealer or physical cards; rather, it deals electronic units (based on a 52-card deck) to the players, using an electronic shuffler with a random-number algorithm. Players insert money directly into Table Master and receive electronic credits, which are displayed on players' screens. Players use their screens to make wagers, side bets, and plays.
Table Master is manufactured by Shufflemaster Entertainment. Brandon Knowles, Shufflemaster's general manager, testified that Table Master is not a simulation of blackjack but the actual game of blackjack played electronically. Knowles stated that Table Master has been tested and recognized as a reliable blackjack table. But he acknowledged that most jurisdictions consider Table Master a slot machine because it uses a random-number generator to determine the game's outcome. Knowles testified that he did not know whether Minnesota law permits Shufflemaster to sell Table Master to North Metro.
North Metro argued that MRC should not rely on Gambling Enforcement's opinion because Minn. Stat. § 240.30, subd. 6 (2012), grants MRC exclusive authority todetermine North Metro's request. North Metro asserted, contrary to Gambling Enforcement's determination, that Table Master is not a gambling device or video game of chance. North Metro further submitted a proposed order with findings of fact and conclusions of law, which incorporated these arguments. MRC staff agreed with Gambling Enforcement's determination and recommended that MRC deny North Metro's request.
During its third hearing on the subject, MRC voted to deny North Metro's request. North Metro asked MRC to state its reasons on the record, but MRC declined because it had moved to another item on its agenda. MRC subsequently issued a written order specifically stating that it declined to adopt North Metro's proposed order and declined to ignore Gambling Enforcement's opinion. This certiorari appeal follows.
By investigating North Metro's request to amend its plan of operation, weighing evidentiary facts, applying the law to the facts, and rendering a binding decision, MRC acted in a quasi-judicial manner. See Minn. Ctr. for Envtl. Advocacy v. Metro. Council, 587 N.W.2d 838, 842 (Minn. 1999) (). An agency's quasi-judicial decision will be upheld unless it is "unconstitutional, outside the agency's jurisdiction, procedurally defective, based on an erroneous legal theory, unsupported by substantial evidence, or arbitrary and capricious." Carter v. Olmsted Cnty. Hous. & Redevelopment Auth., 574 N.W.2d 725, 729 (Minn. App. 1998);see also Hinneberg v. Big Stone Cnty. Hous. & Redevelopment Auth., 706 N.W.2d 220, 225 (Minn. 2005). We do not retry facts or make credibility determinations and will uphold an agency's decision if it "furnished any legal and substantial basis for the action taken." Senior v. City of Edina, 547 N.W.2d 411, 416 (Minn. App. 1996) (quotation omitted); see also Sawh v. City of Lino Lakes, 823 N.W.2d 627, 635 (Minn. 2012).
Whether an agency acted within its statutory authority is a question of law, which we review de novo. In re Hubbard, 778 N.W.2d 313, 318 (Minn. 2010). MRC has the exclusive power to authorize racetracks to operate card clubs in accordance with applicable laws and rules. Minn. Stat. §§ 240.07, subd. 3(b), .30, subd. 1 (2012). Racetracks must obtain approval from MRC of a card club's plan of operation and any subsequent amendments to the plan. Minn. Stat. § 240.30, subds. 1, 6(a), 7(a) (2012). In fulfilling its duties, MRC may request assistance from another state department or agency. Minn. Stat. § 240.04, subd. 7 (2012).
North Metro argues that because MRC has exclusive authority to approve amendments to a card club's plan of operation, the commission erred by relying on Gambling Enforcement's opinion. We disagree. The legislature expressly permitted MRC to seek assistance from other state departments in order to fulfill its duties. See id. Because Gambling Enforcement's duties involve licensing gambling-device distributors, MRC reasonably requested Gambling Enforcement's assistance in determining whether North Metro's use of Table Master complies with Minnesota's gambling laws. See Minn. Stat. § 299L.02, subd. 2(1) (2012) (). And while Gambling Enforcement's opinion is not entitled to deference because it was not the result of formal rulemaking or adjudication, MRC may still rely on the opinion to the extent that it is persuasive. See Martin ex rel. Hoff v. City of Rochester, 642 N.W.2d 1, 21 (Minn. 2002) ().
North Metro further contends that MRC wholly deferred to Gambling Enforcement's opinion and did not use its own expertise and independent judgment. We are not persuaded. The supreme court has emphasized that agencies must employ their own expertise to reach independent decisions and not simply rubber stamp the findings of another body. See City of Moorhead v. Minn. Pub. Utils. Comm'n, 343 N.W.2d 843, 846 (Minn. 1984). We discern no rubber stamping in this case. Rather, in reaching its decision, MRC considered Gambling Enforcement's opinion, MRC staff recommendations, Wilson's and Knowles's testimony, and North Metro's arguments and proposed order. MRC's written statement that it declined to ignore Gambling Enforcement's opinion reflects MRC's implicit determination that the opinion is persuasive in light of the entire record. Accordingly, we conclude that MRC did not err by relying on Gambling Enforcement's opinion.
When reviewing an agency's decision for substantial evidence, we evaluate the evidence in view of the record as a whole. Cable Commc'ns Bd. v. Nor-west Cable Commc'ns P'ship, 356 N.W.2d 658, 668 (Minn. 1984). Substantial evidence is "(1) such relevant evidence as a reasonable mind might accept as adequate to support a conclusion;(2) more than a scintilla of evidence; (3) more than some evidence; (4) more than any evidence; or (5) the evidence considered in its entirety." Minn. Ctr. for Envtl. Advocacy v. Minn. Pollution Control Agency, 644 N.W.2d 457, 465 (Minn. 2002). A party challenging an agency decision has the burden to show that substantial evidence does not support the decision. Carter, 574 N.W.2d at 730.
North Metro argues that...
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