State v. Kramer

• Decision Date: 18 December 2001
• Docket Number: No. 99-2580-CR.,99-2580-CR.
• Citation: 2001 WI 132,637 N.W.2d 35,248 Wis.2d 1009
• Parties: State of Wisconsin, Plaintiff-Respondent-Petitioner, v. Carl R. KRAMER, Defendant-Appellant.
• Court: Wisconsin Supreme Court

248 Wis.2d 1009

2001 WI 132

637 N.W.2d 35

State of Wisconsin, Plaintiff-Respondent-Petitioner, v. Carl R. KRAMER, Defendant-Appellant.

No. 99-2580-CR.

Supreme Court of Wisconsin.

Oral argument September 17, 2001.

Decided December 18, 2001.

For the plaintiff-respondent-petitioner the cause was argued by Thomas J. Balistreri, assistant attorney general, with whom on the briefs was James E. Doyle, attorney general.

For the defendant-appellant there was a brief by Stephen D. Willett and Stephen D. Willett, S.C., Phillips, and oral argument by Stephen D. Willett.

¶ 1. WILLIAM A. BABLITCH, J.

Petitioner Carl Kramer (Kramer), a tavern owner in the Village of North Fond du Lac, was convicted on two counts of being a party to the crime of commercial gambling after his tavern made payouts on two separate occasions to police investigators who earned credits on a video slot machine in the tavern. Kramer had moved to dismiss his criminal complaint on selective prosecution grounds, arguing that he and other owners of taverns located in North Fond du Lac were unfairly singled out for prosecution. The circuit court denied this motion, permitting the trial at which the defendant was convicted. The court of appeals reversed both the order denying Kramer's motion to dismiss and his judgment of conviction after concluding that Kramer was selectively prosecuted.

¶ 2. The State now appeals and asserts that Kramer did not meet his burden on one of the elements of selective prosecution: that the prosecution had a discriminatory effect. We disagree. Because the evidence in this case establishes a prima facie showing of discriminatory effect, and because the State concedes that there was a prima facie showing of discriminatory purpose, we agree with the court of appeals' determination that Kramer established a prima facie claim of selective prosecution. We disagree, however, with the court of appeals' determination that the State failed to rebut this prima facie claim by demonstrating a valid exercise of discretion. The State was never afforded the opportunity to rebut this prima facie claim by presenting evidence showing a valid use of prosecutorial discretion. We therefore reverse the court of appeals' decision and remand to the circuit court for an evidentiary hearing on the rebuttal issue.

I

¶ 3. Kramer owned The Dog House Saloon in the Village of North Fond du Lac in Fond du Lac County. On July 12, 1996, a bartender at The Dog House Saloon paid cash to an undercover police investigator for credits the investigator had accumulated while playing a video slot machine. The investigator was a member of the Lake Winnebago Area Metropolitan Enforcement Group Drug Unit (MEG Unit). The MEG Unit was working with the Village of North Fond du Lac Police Department in investigating commercial gambling in North Fond du Lac. At that time, the Fond du Lac County District Attorney's Office and the Fond du Lac County Sheriff's Department were allegedly not investigating or prosecuting such activity because they believed that the law was unclear concerning whether this activity constituted criminal commercial gambling in violation of Wis. Stat. § 945.03(5)(1995-96).¹

¶ 4. This prosecution policy was later changed in light of the court of appeals' decision in State v. Hahn, 203 Wis. 2d 450, 553 N.W.2d 292 (Ct. App. 1996). In Hahn, Hahn was prosecuted under Wis. Stat. § 945.03(5) after he collected proceeds from video poker machines, which he had placed in three Jefferson County taverns. Id. at 452. The issue presented to the court of appeals was whether Hahn's video poker machines were "gambling machines" under Wis. Stat. § 945.01(3). Id. at 454. The court held that a video poker machine is a "gambling machine" only if it affords a successful player an opportunity to obtain something of value, even if the machine itself does not award the prize. Id. at 457-458. Thus, Hahn clarified the type of machine that may form the basis for a violation of § 945.03(5).

¶ 5. On September 2, 1996, the Fond du Lac County District Attorney and the Fond du Lac County Sheriff sent a letter to tavern owners in the county warning them of the change in policy and informing them that complaints of payouts on video poker machines would now be investigated and prosecuted. The body of the letter stated in full:

Dear Tavern Owner/Liquor License Holder:

We are writing to you today to address the issue of video games that can be used as gambling devices. We recognize the fact that this issue is controversial and has been in litigation for some time. The Wisconsin Attorney General has taken the position that video poker machines are gambling machines. A recent Court of Appeals decision indicates that their presence is not in itself a violation, but any type of pay-out from playing the machine constituted an act of gambling.

Some jurisdictions have already chosen to confiscate machines because of their mere presence, but the Fond du Lac County Sheriff's Department and the District Attorney's Office have been patient with this issue because of the vagueness of the law. The Court of Appeals has now established a precedent [Hahn] which will stand unless a higher court overrules it. In the future, Deputies will make note of who has machines when they do their routine tavern checks. If we receive a complaint that payouts of any kind are being made in an establishment, we will commence a commercial gambling investigation. You should be aware that a conviction for commercial gambling under state statute 945.03 is a felony. The law also provides for such matters to be forwarded to the licensing authority for revocation of the establishment's liquor license.

We are sure that the legal battle will continue over video gambling, but this henceforth will be the policy of the Fond du Lac County Sheriff's Department and the District Attorney's Office. We do not seek to exacerbate the situation, but we will not be put in a position where we are unable to respond in an effective manner to a violation of the law. For those of you who do not have machines, we apologize for taking your time. For those of you that do, this letter will serve as your only warning to this policy. If you have any questions on this matter, please feel free to call on us. [Second, third, and fourth emphases added.]

This letter was not sent to Kramer or any other owner of a tavern located in the Village of North Fond du Lac.

¶ 6. On December 4, 1996, after playing a video slot machine at The Dog House Saloon, an undercover investigator from the MEG Unit received a payout from Kramer, who was tending bar at that time. The next day, a search warrant was executed at the tavern, during which a video slot machine was seized. That same day, search warrants were also executed and video gambling machines seized at several other North Fond du Lac taverns, including (1) The North Fondy Connection owned by Charles Erke; (2) The Village Vault owned by Carol Van Norman; and (3) The Freight House Tavern owned by Roger Lange.

¶ 7. Kramer was subsequently charged with two counts of being a party to the crime of commercial gambling in violation of Wis. Stat. §§ 939.05 and 945.03(5) for the payouts on July 12, 1996 and December 4, 1996. Charges were also brought against Erke, Van Norman, and Lange. No tavern owners outside the Village of North Fond du Lac were prosecuted on commercial gambling charges.

¶ 8. Kramer moved to dismiss the charges based in part on the claim that he was the victim of selective prosecution. He alleged that he and other owners of taverns located in North Fond du Lac were unfairly singled out for prosecution. According to Kramer, this systematic prosecution was evidenced by the fact that he and the other North Fond du Lac tavern owners were the only tavern owners in the county prosecuted even though they never received a letter from the prosecutor informing them of the change in policy. This unfairness was exacerbated, Kramer contended, by the fact that North Fond du Lac Police Chief Larry Wodack assured him and the other tavern owners that their use of video slot machines was legal, while at the same time Wodack was conducting an investigation into alleged commercial gambling against these same owners. Kramer alleged that Wodack's overall objective was to eliminate some of the taverns in North Fond du Lac.

¶ 9. The Fond du Lac County Circuit Court, the Honorable Peter L. Grimm presiding, denied the motion, concluding that Kramer had failed to make a prima facie case of selective prosecution. The court noted that selective prosecution may be raised when the defendant is a member of a protected class; it concluded, however, that Kramer did not fall within any such classification. Selective prosecution, the court stated, could also occur in instances where the defendant is a solitary prosecution. The court then viewed Kramer's evidence to support this claim, including various police reports showing three seizures of video gambling machines in City of Fond du Lac taverns. The owners of these taverns were never prosecuted. The court determined, however, that the city cases did not support the selective prosecution claim because they were factually distinguishable from Kramer's case based on a lack of evidence to show commercial gambling. The court noted that in two of the city cases there was no evidence of payouts or of actual customers playing the games to get money from the tavern owners. In the third city case, although there was evidence that the tavern owner admitted to video gambling taking place in the tavern, the court concluded that there was still no actual evidence of a payout to a customer. This evidence, the court stated, amounted to an insufficient statistical showing to constitute a prima facie claim of selective prosecution.

¶ 10. The court did not regard the distribution of the warning letter as having any significance on the selective prosecution claim; in fact, it stated that...