Petition of Soto

• Decision Date: 23 October 1989
• Citation: 236 N.J.Super. 303,565 A.2d 1088
• Parties: In the Matter of the Petition of Gloria E. SOTO for a Declaratory Ruling as to the Applicability of N.J.S.A. 5:12-138 to Certain Political Activities. Gloria E. SOTO, Plaintiff-Appellant, v. STATE of New Jersey, New Jersey Casino Control Commission and Department of Law and Public Safety, Division of Gaming Enforcement, Defendants-Respondents.
• Court: New Jersey Superior Court — Appellate Division

Page 303

236 N.J.Super. 303

565 A.2d 1088

In the Matter of the Petition of Gloria E. SOTO for a Declaratory Ruling as to the Applicability of N.J.S.A. 5:12-138 to Certain Political Activities Gloria E. SOTO, Plaintiff-Appellant, v. STATE of New Jersey, New Jersey Casino Control Commission and Department of Law and Public Safety, Division of Gaming Enforcement, Defendants-Respondents.

Superior Court of New Jersey Appellate Division.

Argued Oct. 31, 1988.

Decided Oct. 23, 1989.

Edward N. Fitzpatrick, for appellant (Clapp & Eisenberg, Edward N. Fitzpatrick, Newark, of counsel; Frederic S. Kessler and Harvey C. Kaish on the brief; Frederic S. Kessler, Newark, on the reply brief).

Gary A. Ehrlich, Deputy Atty. Gen., for respondent Div. of Gaming Enforcement (Cary Edwards, Atty. Gen. of New Jersey, Anthony J. Parrillo, Asst. Atty. Gen., of counsel; Gary A. Ehrlich on the brief).

Robert J. Genatt, for respondent New Jersey Casino Control Com'n (Robert J. Genatt, Gen. Counsel, Trenton, of counsel and on the brief with Mark Neary, Asst. Counsel, Belle Mead).

Before Judges J.H. COLEMAN, DEIGHAN and BAIME.

The opinion of the court was delivered by

DEIGHAN, J.A.D.

This case presents a difficult question concerning casino employee regulations which may infringe upon constitutional rights. Plaintiff Gloria E. Soto, an attorney and also a casino key employee, challenges statutory restrictions contained in N.J.S.A. 5:12-138 (§ 138) which prohibit a casino officer or key employee from contributing any "money or thing of value" to a candidate for public office or any party or group organized to support such candidates.

Plaintiff had requested a ruling from the Casino Control Commission, which ruled that plaintiff could continue certain voluntary political activities but could not provide free legal services to any political organization or candidate. Plaintiff also filed a declaratory judgment action in the Chancery Division challenging the constitutionality of the act. Judge Gibson, in an oral opinion, found the statute in question to be constitutional. Both matters have been consolidated for purposes of this appeal.

Based on our thorough review of the record we affirm.

The facts are not in dispute. In 1985 plaintiff was selected by the New Jersey Democratic Party to serve as a member of its Platform Resolutions Committee (Platform Committee). At the time, plaintiff was employed by Trump Casino Hotel as its associate general counsel. Plaintiff had previously been designated a casino key employee by the Casino Control Commission (Commission) and had been granted the requisite license.

At the time of her assignment to the Platform Committee, plaintiff was aware of the provisions of § 138. On July 11, 1985, plaintiff informed the Commission of her assignment and requested a ruling as to whether the restrictions contained in § 138 would prohibit her service on the Platform Committee.

In the interim, plaintiff became employed by the Claridge Casino Hotel as the Director of Regulatory Affairs. Plaintiff was also required to be licensed as a casino key employee for this position. The Claridge Board of Directors subsequently appointed plaintiff to the office of Vice President for Compliance and Legal Affairs. As a vice president, plaintiff is both a key employee and an officer of the Claridge.

On September 3, 1985 plaintiff requested that her application for a declaratory ruling be expanded to include a ruling on whether her personal participation in a committee of a state political party is a contribution of a "thing of value" within the proscriptions of § 138. On September 10, 1985, the Commission informed plaintiff that, as requested, the scope of the hearings would be expanded. She was also informed of the need for "more facts concerning the activities covered by [her] request."

Plaintiff did not submit the information requested by the Commission; instead, on November 4, 1986, she filed an amended petition which sought a ruling from the Commission that § 138 violated the United States Constitution. On November 17, 1986, the Commission advised plaintiff that it lacked the jurisdiction and authority to entertain or resolve constitutional challenges to its enabling statutes. The Commission also advised plaintiff that it did not have sufficient facts upon which to make a ruling on plaintiff's initial application and again requested further information. Plaintiff did not respond to the Commission's request; instead, her attorney informed the Commission that plaintiff intended to file a declaratory judgment action in the Superior Court concerning the constitutionality of § 138 and requested an indefinite adjournment pending the disposition of the court action.

On January 20, 1987, plaintiff filed a complaint in the Superior Court, Chancery Division, seeking a declaratory judgment that § 138 was unconstitutional in that it interfered with her rights of free speech and association. She also asserted that the phrase "thing of value" rendered the statute fatally vague and overbroad. Plaintiff further contended that the statute discriminated against casino key employees in violation of the Equal Protection clause of the Fourteenth Amendment of the United States Constitution.

The Division of Gaming Enforcement (Division) and the Commission filed answers and then moved to dismiss the complaint or for summary judgment. After a hearing, Judge Gibson, on June 8, 1987, referred the case back to the Commission and ordered the Commission to determine the scope and definition of the phrase "thing of value" as it applied to plaintiff's proposed activities. The order also denied both defendants' motions without prejudice. Judge Gibson retained jurisdiction of the constitutional issues presented by plaintiff.

On June 9, 1987, plaintiff sent a letter to the Commission to amend her November 1986 petition to include rulings on the specific types of political activities in which she intended to engage. Plaintiff indicated that she planned to participate in: (1) the Platform Resolutions Committee of the New Jersey Democratic Party; (2) the New Jersey Hispanic Democrats; (3) the "Committee of 200," and (4) the Affirmative Action Committee of the New Jersey Democratic Party. She described the purpose and function of each of the organizations and the extent and nature of her proposed activity.

Following a hearing on July 8, 1987, the Commission analyzed § 138 and ruled that:

(1) Plaintiff could serve on the Platform Resolutions Committee of the New Jersey Democratic Party since she would "not be required to provide any professional legal services" as a result of her membership.

(2) Plaintiff could join the New Jersey Hispanic Democrats and could provide services incidental to her membership so long as those services did not constitute money or a "thing of value." The Commission found that plaintiff's offer of free legal service to this organization would constitute a thing of value and therefore would be in direct violation of § 138.

(3) Plaintiff was barred from joining the Committee of 200, since the annual membership fee of $1,000 clearly violated § 138.

(4) Plaintiff could serve on the Affirmative Action Committee of the New Jersey Democratic Party, since it "would involve only such personal services as are necessary for the Petitioner to express her views and to advocate minority representation."

The Commission and the Division then renewed their motions to dismiss or for summary judgment before Judge Gibson. On October 13, 1987, Judge Gibson delivered an oral opinion in which he found § 138 to be constitutional and granted the defendants' motion to dismiss the complaint. In reaching his decision, Judge Gibson made, among others, the following findings:

In particular, with respect to the Casino Control Act, it is this Court's conclusion that although the limitation with respect to First Amendment freedoms has been demonstrated, the type of limitation here is of the marginal type referred to by the Supreme Court in Buckley. ¹ By that I mean that there is no limitation under this statute to Gloria Soto's ability to speak out on public issues. There is no limit on her ability to support, through her expression of views, a particular candidate, there is no limit on her ability to join and participate in a political party. Her freedom to speak, her freedom to associate in those senses have not been impacted upon by Section 138. The impact is a more limited kind.

* * *

* * *

On the question of whether there has been a showing of a sufficiently compelling State interest in this case, I'm satisfied that there has been. As the history of this State's public policy towards casino gambling reflects, there has been a longstanding and strong sensitivity to the evils traditionally associated with casino gambling when it is unregulated, and even when there is regulation, there is a continued sensitivity to the maintenance of the integrity of the process, and in particular, the regulatory process.

As I pointed out earlier, when casino gambling was legalized here in New Jersey, it was only on the condition that it be strictly regulated and that the regulation that came out of it extended not only to the casinos but to the people who ran the casinos.

* * *

* * *

The Legislature recognized when it passed the Casino Control Act the limitation that the constitutional amendment carried with it and the Legislature recognized the concentration of wealth that exists with casinos and the disproportionate weight of that wealth, and how the casinos as a group or individually can bring that to the political process. The Legislature recognized the need for maintaining the integrity of the regulatory process, not in just some abstract way, but because the acceptability of casino gambling in the State depends on strict regulation.

An equally important fact in that process is maintaining not just the actual integrity of the regulations but the...