Johnson v. Collins Entertainment Co.
| Decision Date | 19 November 1998 |
| Docket Number | No. 24858.,24858. |
| Citation | 333 S.C. 96,508 S.E.2d 575 |
| Court | South Carolina Supreme Court |
| Parties | Joan Caldwell JOHNSON, Brice Anderson, Lorraine Witherspoon Baker, Faye Blaylock, Sara Edell Boan, Mike Brewer, Mike Brown, Ronald Callahan, Sandra Coulter, Lisa Crum, Andreas Drutis, Crystal Gayle Edwards, Darryl Bernard Epps, Buster Elfin Floyd, Deanna Kay Franz, William Joseph Harnett, Jr., George Henley, Loretta Jones, Margaret Locklear, Tammy Locklear, Linda McCleod, William McCormick, Hugh Meise, Patty Miller, Andrew Nobles, Gary Padgett, Mary Pinchback, Vardry Pittman, Albert J. Samra, Mason Skeenes, Danny Kaye Smith, Jim Stolz, Amber Strickland, Charles Stubbs, Lonya Thigpen, James Thompson, Joseph Chester Walker, Jessie Williams, Valerie Williams, and on behalf of themselves and all others similarly situated, Plaintiffs, and Charles Molony Condon, as Attorney General for the State of South Carolina, Intervenor, v. COLLINS ENTERTAINMENT CO., INC., Ace Amusement, LLC, American Amusement Co., Inc., American Amusement of Aiken, Inc., B & J Amusement, Best Amusement Co., Broyles & Lutz, Inc., CBA Games, Inc., Carousel Amusements, Coley, Inc., Drew Industries, Fast Freddies, Great Games, Inc., Greenwood Music Co., Inc., H & J of South Carolina, Inc., Holliday Amusement Co. of Charleston, Inc., Hoyts Music Co., Inc., Huckleberry Amusement, Inc., Ingram Investments, J.M. Brown Amusement Co., Inc., Joytime Distributors & Amusement, Larry Wolfe Amusement, MHJ Corp., MHS Enterprises, Inc., Martin Coin Machine, Inc., McDonald Amusement Co., Midlands Gaming Corp., Orangeburg Amusement, Inc., Pedroland, Inc., R.L. Jordan Oil Co. of North Carolina, Red Dot Amusements, Rosemary Coin Machines of Florence, Inc., Scott's Vending Inc. of Columbia, Sumter Petroleum Co., Tim's Amusement, Inc., Video-Matic Amusements, Inc., H. Hugh Andrews, II, Pamela A. Andrews, Dwayne I. Bohannon, J.M. Brown, Don E. Broyles, Grace E. Coley, Fred Collins, J. Samuel Cox, Kenneth G. Flowe, Carey Hardee, Scott G. Hogue, Lowell E. Holden, Patricia Holliday, Warren P. Holliday, Henry E. Ingram, Steven E. Lipscomb, Tim Mahon, Jimmy Martin, Jr., Cynthia McDonald, James McDonald, Allan Schaefer, David R. Simpson, Ron Simpson, Mickey H. Stacks, William Darwin Wheeler, Hershel L. Williamson, and A.J. Wilson, Jr., in their individual and corporate capacities as representatives of all others similarly situated, Defendants. |
Wilburn Brewer, Jr., of Nexsen, Pruet, Jacobs & Pollard, of Columbia; Lawrence Edward Richter, Jr., and Saul Gliserman, both of Richter Law Firm, of Mt. Pleasant; Robert R. Bridwell, of Columbia; Richard Mark Gergel, W. Allen Nickles, III and Carl Lewis Solomon, all of Gergel, Nickles & Grant, of Columbia; Joseph Preston Strom, Jr., and Tom Young, both of Strom & Young, of Columbia; and Richard K. Walker, of Phoenix, Arizona, for Plaintiffs Joan Caldwell Johnson, et al.
Attorney General Charles Molony Condon, Chief Deputy Attorney General John W. McIntosh, Deputy Attorney General Zeb C. Williams, III, Assistant Deputy Attorney General Robert Dewayne Cook, Assistant Attorneys General Reginald I. Lloyd and Christie Newman Barrett, all of Office of the Attorney General, of Columbia, for Intervenor the State of South Carolina.
Oscar William Bannister, Jr. and James W. Bannister, both of Hill, Wyatt & Bannister, of Greenville; Robert E. Blakely, of Notre Dame, Indiana; and Timothy Clayton Youmans, of the Collins Companies, of Columbia, for Defendant Collins Entertainment. Zoe Sanders Nettles, Dwight Franklin Drake, Robert Bruce Shaw, Benjamin Rush Smith, III and C. Mitchell Brown, all of Nelson, Mullins, Riley & Scarborough, of Columbia; A. Camden Lewis and Mary Geiger, both of Lewis, Babcock & Hawkins, of Columbia, for Defendants American Amusement Company, et al. David E. Belding, of
Columbia, for Defendants Red Dot Amusements, et al. Timothy Gene Quinn, of Columbia, for Defendant Carousel Amusement. Richard A. Harpootlian and Robert G. Rikard, both of Richard A. Harpootlian, P.A., of Columbia, for Defendant Coley, Inc. David E. Taylor, of Columbia, for Defendant B & J Amusement. Anne Sumner Douds, of Kiker & Douds, of Beaufort for Defendant Ingram Investments. John C. Lindsay, Jr., of Lindsay & Lindsay, of Bennettsville; and J. Boone Aiken, III, of Coleman, Aiken & Chase, P.A., of Florence, for Defendant Pedroland, Inc. Matthew A. Henderson, of Henderson, Brandt & Vieth, of Spartanburg, for Defendant R.L. Jordan Oil of North Carolina.
This matter is before the Court on certification from the United States District Court to answer the following questions.
Plaintiffs, purporting to represent themselves and others similarly situated, initiated this action for damages and injunctive relief in the State circuit court in June 1997. Defendants own or operate video gaming devices (video poker machines) under authority of licenses issued by the South Carolina Department of Revenue. Defendants removed the action to Federal District Court because the asserted claims included a cause of action under the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §§ 1961 et seq. Subsequently, additional plaintiffs and defendants were added, and the complaint was amended to allege that video poker games are being operated in violation of Article XVII, § 7 of the South Carolina Constitution, which prohibits lotteries.
In December 1997, the plaintiffs filed a motion for a preliminary injunction seeking to have the court enjoin the defendants from continuing to operate their video poker games because the games are illegal lotteries under the State Constitution and are violative of state statutes. The parties agreed that the constitutional issue could override the statutory issues. The South Carolina Attorney General has intervened and joined in the motion for injunctive relief. The District Court allowed the parties to engage in extensive discovery prior to a hearing on the motion for a preliminary injunction. Based upon evidence presented at the motion hearing, that Court made factual findings and issued an Order of Certification to the South Carolina Supreme Court pursuant to South Carolina Appellate Court Rule 228.
Rule 228(b), SCACR,2 contemplates that the South Carolina Supreme Court will base its answers to the questions certified exclusively upon the findings of fact by the District Court and, if necessary, the record in this matter.
In considering Question 1, we look to the applicable provision of the State Constitution, which reads:
No lottery shall ever be allowed or be advertised by newspapers, or otherwise, or its tickets be sold in this State. The game of bingo, when conducted by charitable, religious or fraternal organizations exempt from federal income taxation or when conducted at recognized annual State and county fairs, shall not be deemed a lottery prohibited by this section.
The Constitution does not prohibit games of chance or gambling per se; with the exception that it is unlawful for public officials to engage in "gambling or betting on games of chance." S.C. Const. art. XVII, § 8. The framers of our Constitution clearly distinguished between "lottery" and "gambling or betting on games of chance." Adhering to the constitutional distinction, the South Carolina statutory scheme includes sections that specifically deal with lottery, gaming, and betting. See, e.g., S.C.Code Ann. §§ 16-19-10 to 16-19-30 (lotteries); S.C.Code Ann. § 16-19-40 (); and S.C.Code Ann. § 16-19-60 (coin-operated pinball machines). This distinction between lottery and other forms of gaming, found within the text of the Constitution itself, supports the conclusion that its framers used the term "lottery" in a narrow sense. This conclusion accords with that of the South Dakota Supreme Court in a similar case:
[B]y separately stating the terms `game of chance' and `lottery,' the framers of the original [constitutional] provision intended the term `game of chance' to be broad in scope, including most forms of gaming, and the term `lottery' in the narrower sense contemplating the sale of tokens or tickets to large numbers of people for the chance to share in the distribution of prizes for the purpose of raising public revenue.
Poppen v. Walker, 520 N.W.2d 238, 245 (S.D.1994).
The Constitutional exemption for bingo4 is consistent with a narrow reading of the word "lottery" since bingo is commonly defined as a game derived from lotto, which in turn is based on lottery,5 or a form of lottery often played simultaneously by hundreds or thousands of people.6 However, the fact that bingo is generally considered a lottery, and meets the common definition of lottery, does not prove that other forms of gambling are lotteries. Further, it does not undermine the conclusion that the term lottery is narrowly construed.
The Court in Rountree v. Ingle, 94 S.C. 231, 77 S.E. 931 (1913),7 distinguished lotteries from gambling by stating: "Our statute makes not only the promoter of a lottery, but the adventurers in it liable to indictment ... The purchaser of a lottery ticket in this State is therefore in a different plight from one who loses money in gambling ... who may recover the amount paid out."
The Court in Darlington Theatres characterized a lottery as a form of gambling which provided for the distribution of prizes by lot or chance. Darlington Theatres, Inc. v. Coker, 190 S.C. 282, 2 S.E.2d 782 (1939). While every lottery is a gaming device, not every gaming device is a lottery...
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Town of Mount Pleasant v. Chimento
...of gambling, one “in which a large number of tickets are sold and a drawing is held for certain prizes.” Johnson v. Collins Entertainment Co., Inc., 333 S.C. 96, 508 S.E.2d 575 (1998). In Collins, the dissenters would have adopted a much broader definition of lottery, and thus would have re......
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Martin v. Stewart
...620 S.E.2d 76 (2005); Joytime Distribs. & Amusement Co. v. South Carolina, 338 S.C. 634, 528 S.E.2d 647 (1999); Johnson v. Collins Entm't Co., 333 S.C. 96, 508 S.E.2d 575 (1998); Martin v. Condon, 324 S.C. 183, 478 S.E.2d 272 (1996); Blackmon, 304 S.C. 270, 403 S.E.2d Fifth, the South Carol......
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Dalton v. Pataki
...that he (or she) will receive something of value in the event of a certain outcome"]; see also Johnson v Collins Entertainment Co., 333 SC 96, 101, 508 SE2d 575, 577-578 [1998] [concluding that where a state constitution distinguishes between lottery and gambling or other games of chance, l......
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Town of Mount Pleasant v. Chimento
...of gambling, one "in which a large number of tickets are sold and a drawing is held for certain prizes." Johnson v. Collins Entertainment Co., Inc., 333 S.C. 96, 508 S.E.2d 575 (1998). In Collins, the dissenters would have adopted a much broader definition of lottery, and thus would have re......