Kraft v. Detroit Entertainment, LLC, Docket No. 241405.
| Decision Date | 24 June 2004 |
| Docket Number | Docket No. 241405. |
| Citation | 261 Mich.App. 534,683 N.W.2d 200 |
| Parties | Mary KRAFT, Plaintiff-Appellant, v. DETROIT ENTERTAINMENT, L.L.C., d/b/a Motor City Casino, Greektown Casino, L.L.C., d/b/a Greektown Casino, and MGM Grand Detroit, L.L.C., d/b/a MGM Grand Detroit Casino, Defendants-Appellees, and International Game Technology, Inc., and Anchor Gaming, Inc., Defendants, and IGT and Anchor Coin, Intervening Defendants-Appellees. |
| Court | Court of Appeal of Michigan — District of US |
Wasinger Kickham & Hanley (by Stephen Wasinger and Gregory D. Hanley) and Mantese Miller & Shea, PLLC (by E. Powell Miller), Royal Oak, Troy, for the plaintiff.
Dickinson Wright PLLC (by Lawrence G. Campbell, Kathleen A. Lang, and L. Pahl Zinn), Detroit, for the defendants.
Barris, Sott, Denn & Driker, PLLC (by Eugene Driker, Morley Witus, and Matthew Millikin), Detroit, for intervening defendants.
Before: WHITBECK, C.J., and ZAHRA and DONOFRIO, JJ.
Plaintiff appeals as of right from an order summarily dismissing her lawsuit. We must determine whether plaintiff may pursue a claim under the Michigan Consumer Protection Act (MCPA), MCL 445.901 et seq., or common-law claims of fraud and unjust enrichment against defendants IGT and Anchor Coin, the manufacturer and designer of two slot machines used in Detroit casinos. Plaintiff maintains that these slot machines are deceptive because they misrepresent the chances of winning a large payoff. Defendants deny that the slot machines are deceptive, but argue that, even if they are, plaintiff's claims must fail as a matter of law. We conclude that the trial court properly dismissed plaintiff's claims. The MCPA expressly exempts from its reach "[a] transaction or conduct specifically authorized under laws administered by a regulatory board ... acting under statutory authority of this state...." MCL 445.904(1)(a). Because the operation of these slot machines is specifically authorized by the Michigan Gaming Control Board (MGCB), defendants are exempt from plaintiff's MCPA claims. The trial court also properly dismissed plaintiff's common-law claims. These claims are "preempted"1 by § 3 of the Michigan Gaming Control and Revenue Act (MGCRA), MCL 432.201 et seq. We affirm.
Detroit Entertainment, L.L.C.; Greektown Casino, L.L.C.; and MGM Grand Detroit, L.L.C., (collectively the casino defendants) offer at their casinos two slot machines identified as "Wheel of Fortune" and "I Dream of Jeannie." These slot machines operate like traditional three-reel slot machines, but also feature a "bonus wheel" that activates when a certain combination is displayed on the slot machine reels. The bonus wheel consists of twenty-two equally proportioned pie-shaped pieces and looks like the wheel utilized on the popular television game show "Wheel of Fortune." Each pie-shaped section has a number between twenty and one thousand that represents the number of coins the player wins when the wheel stops on that number. A computer program within the machine determines where the bonus wheel will stop when it is activated. The chances of stopping on one of the higher payoff numbers is significantly smaller than the chances of stopping on one of the lower pay off numbers.2 Anchor Coin's patent for these slot machines states that the bonus wheel can provide players "a realistic sense of a totally mechanical indicator," but that the internal computer program will "randomly select the winning payout according to a predetermined frequency of occurrence for each individual bonus payout, and then cause the bonus indicator to stop at the desired area."
Plaintiff filed a class-action lawsuit3 against the casino defendants; International Game Technology, Inc.; and Anchor Gaming, Inc.,4 alleging that defendants violated the MCPA and fraudulently induced consumers to play or continue to play the slot machines, while unjustly enriching themselves, by failing to disclose that the bonus wheels on the "Wheel of Fortune" and "I Dream of Jeannie" slot machines were programmed to stop much more frequently on spaces with lower monetary payoffs.
The casino defendants moved for summary disposition under MCR 2.116(C)(8) and MCR 2.116(C)(10), arguing that they were exempt from plaintiff's MCPA claims, because the MCPA does not apply to transactions or conduct specifically authorized under laws administered by the MGCB, which is a state-authorized regulatory body. The casino defendants argued that the MGCB approved the slot machines, thus triggering the MCPA's exemption. The casino defendants also argued that plaintiff could not state a claim for silent fraud, misrepresentation, or unjust enrichment, because she did not establish that the casino defendants owed her a duty to disclose information concerning the specifications of the operation of the slot machines. IGT and Anchor Coin (collectively the manufacturer defendants) also moved for summary disposition, joining in the casino defendants' argument that they were exempt from plaintiff's MCPA claims. The manufacturer defendants also argued that the MGCRA preempts all statutory and common-law claims concerning casino gaming devices once the devices are approved by the MGCB. The trial court granted defendants' motions for summary disposition, and plaintiff appeals as of right.
Defendants filed their motions for summary disposition under MCR 2.116(C)(8) and (C)(10). We review de novo a trial court's resolution of a motion for summary disposition. Veenstra v. Washtenaw Country Club, 466 Mich. 155, 159, 645 N.W.2d 643 (2002). The trial court did not specify under which subrule it granted defendants' motions for summary disposition. However, with respect to the claim under the MCPA, the trial court relied on facts outside the pleadings to establish that the MGCB approved the use of the slot machines at issue in this case. Therefore, we treat dismissal of the MCPA claim as having been granted under MCR 2.116(C)(10). Velmer v. Baraga Area Schools, 430 Mich. 385, 389, 424 N.W.2d 770 (1988).
A motion for summary disposition under MCR 2.116(C)(10) tests the factual sufficiency of the complaint. Veenstra, supra at 163, 645 N.W.2d 643. The trial court must consider affidavits, pleadings, depositions, admissions, and any other evidence submitted by the parties in a light most favorable to the nonmoving party. Id. at 164, 645 N.W.2d 643. Summary disposition should be granted if there is no genuine issue of any material fact and the moving party is entitled to judgment or partial judgment as a matter of law. MCR 2.116(C)(10), (G)(4); Veenstra, supra at 164, 645 N.W.2d 643.
Dismissal of plaintiff's common-law claims was premised exclusively on the pleadings. Accepting all the well-pleaded allegations of plaintiff's complaint as true, the manufacturer defendants argued, and the trial court ruled, that plaintiff's claims were barred as a matter of law under the preemption provision of the MGCRA. Thus, dismissal of plaintiff's common-law claims was pursuant to MCR 2.116(C)(8). A motion for summary disposition under MCR 2.116(C)(8) tests the legal sufficiency of the complaint on the basis of the pleadings alone. Beaudrie v. Henderson, 465 Mich. 124, 129, 631 N.W.2d 308 (2001). Summary disposition should be granted if the plaintiff has failed to state a claim on which relief can be granted and no factual development could possibly justify recovery. Id. at 130, 631 N.W.2d 308.
Our review of this matter also requires us to interpret and apply the MCPA and the MGCRA. Questions of statutory interpretation are also subject to review de novo. Eggleston v. Bio-Medical Applications of Detroit, Inc., 468 Mich. 29, 32, 658 N.W.2d 139 (2003).
The MCPA expressly provides that it does not apply to "[a] transaction or conduct specifically authorized under laws administered by a regulatory board ... acting under statutory authority of this state...." MCL 445.904(1)(a). Plaintiff argues that this exemption does not apply in this case because she is challenging defendants' advertising and promotion of the slot machines at issue, which is conduct that is not specifically authorized by the MGCB.
In Smith v. Globe Life Ins. Co., 460 Mich. 446, 597 N.W.2d 28 (1999), our Supreme Court interpreted the phrase "specifically authorized" as used in MCL 445.904(1)(a). Smith involved a dispute regarding the defendant insurer's avoidance of a credit life and disability insurance policy on the ground that the insured misrepresented the state of his health on the insurance application. Id. at 448-449, 597 N.W.2d 28. The plaintiff filed a complaint alleging violations of the MCPA, which was dismissed by the trial court. Id. at 451-453, 597 N.W.2d 28. On appeal to the Supreme Court, the defendant argued that the sale of credit life insurance was "specifically authorized" by law under MCL 445.904(1)(a) and therefore exempt from the plaintiff's claim of MCPA violations, because the defendant's application and certificate of insurance forms were submitted to and approved by the State Commissioner of Insurance. Id. at 462-463, 597 N.W.2d 28. The plaintiff responded that MCL 445.904(1)(a) does not specifically authorize fraudulent insurance practices. Id. at 463, 597 N.W.2d 28. The Supreme Court concluded that in determining whether a transaction or conduct is "specifically authorized" by law, Id. at 465, 597 N.W.2d 28.
Applying the legal standard established in Smith, supra at 465, 597 N.W.2d 28, we conclude that the general conduct involved in this case — the...
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