United States v. ONE HUNDRED THIRTY-NINE GAMBLING D., 1058-D
| Decision Date | 12 December 1952 |
| Docket Number | No. 1058-D,1059-D.,1058-D |
| Parties | UNITED STATES v. ONE HUNDRED THIRTY-NINE GAMBLING DEVICES ALIAS SLOT MACHINES, MORE OR LESS et al. UNITED STATES v. FOUR HUNDRED NINETY-SIX GAMBLING DEVICES ALIAS SLOT MACHINES, MORE OR LESS et al. |
| Court | U.S. District Court — Eastern District of Illinois |
William W. Hart, U. S. Atty. and Ray M. Foreman, Asst. U. S. Atty., Danville, Ill., for libelant.
Kramer, Campbell, Costello & Wiechert, by R. E. Costello, East St. Louis, Ill., for claimants Everett Smith, R. H. Schneider and Kermit Reay.
Two libel suits have been consolidated for trial and decision by this court. The libels allege that special agents of the Federal Bureau of Investigation seized 139 gambling devices together with material parts therefor in one case and 496 gambling devices along with parts in the other case; that all of the machines, commonly known as slot machines, were seized in East St. Louis, St. Clair County, Illinois. The government seeks to condemn these machines and parts for the reason that they were possessed and used at the places set forth in the libels by persons who were not registered as dealers as required by 15 U.S.C.A. § 1171ff., referred to hereafter as the Johnson Act. After monition, Everett Smith and R. H. Schneider filed answer in one suit and Kermit Reay filed answer in the other suit. The answers deny the violation of the statute. Claimants Smith and Schneider allege that they are the owners of 139 machines. Claimant Kermit Reay alleges he is the owner of all but three of the 496 seized machines. The answers further deny that the claimants were dealers under the terms of the Act and required to register. Claimants further allege that the Act is so vague, uncertain, and indefinite in defining a dealer that it violates the Fifth Amendment of the Constitution and is therefore unconstitutional. Claimants pray the return of the machines.
The government and the claimants entered into a stipulation as to certain facts in each case, viz., (1) That the court has jurisdiction of the subject matter of the cause and the parties hereto; (2) That prior to and on January 2, 1951 and until March 5, 1952 the claimants were operating and conducting their businesses in East St. Louis, St. Clair County, Illinois; (3) That prior to January 2, 1951 claimants had acquired practically all of the gambling devices, commonly known as slot machines; (4) That subsequent to January 1, 1951, the claimants had not purchased, sold, or transported in interstate commerce or caused to be purchased, sold, or transported in interstate commerce any coin operated gambling devices, commonly known as slot machines, and particularly did not purchase, sell, or transport in interstate commerce any of the said gambling devices or any sub-assembly or material part or parts of said slot machines; (5) That the operations and transactions of the claimants as carried out or performed by them in the course of their businesses, both prior or subsequent to January 1, 1951 were as follows: That some of said devices were kept in storage and the remainder of them were placed in business houses of certain persons, but the claimants retained keys thereto so that no one other than claimants had access to the mechanism of said machines or the money contained therein. The claimants received 50 percent of the coins in each machine and the proprietor of the establishment in which the machines were located received the other 50 percent. The claimants maintained the gambling devices in good operating condition and repaired or replaced any gambling devices which failed to function properly for the purposes intended from machines kept in storage and from the sub-assembly and material parts kept at their places of business; that it was the usual and customary policy when said machines were opened by the claimants or their agents or employees where they were located, for the purpose of either removing the money from the said machines or to repair them, for the owner of the establishment to be present; (6) That on March 5, 1952 in the Eastern District of Illinois the devices herein involved were seized by the special agents of the Federal Bureau of Investigation, Department of Justice, pursuant to search warrants issued by the United States Commissioners, and that the devices are now in the custody and possession of Carl J. Werner, United States Marshal for the Eastern District of Illinois; (7) That neither claimant has ever registered as a "dealer" under the terms and provisions of the Johnson Act, nor have any of the persons in whose establishments the devices were placed registered in accordance with said Act.
Testimony was offered by the government and claimant Reay in one suit. Frank Newgent testified for the government that he owned three of the seized gambling devices and operated them for a short time in his place of business in East St. Louis. The local authorities ordered him to stop and he stored them in Reay's place; that he purchased three machines in the latter part of 1950 from Reay. He traded one device to Reay after January 2, 1951 for another machine. Reay offered evidence that these machines were sold to Newgent at the request of a friend of Newgent's in the latter part of 1949, and one machine was traded to him early in 1950. Other evidence was offered as to the date of the trade. The court finds that these machines were kept by Newgent for operation and not intended to be sold or entered in interstate commerce. The court further finds from all the evidence that Reay made this one sale after January 2, 1951, the effective date of the Johnson Act. Newgent has filed no claim or answer.
After the claimants had filed their brief the government attorneys filed reply brief and a motion to strike the claimants' answers and to dismiss them as parties to the suit. The theory of the government is that the claimants admit the nature of the gambling devices to be slot machines by the stipulation; that slot machines are per se pernicious and dangerous to the public welfare; and they are subject to confiscation and destruction by the Illinois authorities wherever they are found, by virtue of the Illinois Criminal Code, Ch. 38, Sec. 342, Ill. Rev.Stat.1951;1 that this statute has been held constitutional in the State of Illinois.2 Libelant contends further that the Illinois courts have held that there can be no property in slot machines.3 The government therefore maintains since the claimants have no interest in the subject matter of this suit their answers should be stricken and they should be dismissed by the court.
The fallacy of the government's position is quite clear. Claimants may have no property rights in the slot machines under the Illinois law. They may have violated the Illinois statute in possessing the machines.4 But the question here is whether claimants have violated the Johnson Act. The claimants have a locus standi in this court and have a right to defend the suit. McVeigh v. United States, 11 Wall. 259-268, 20 L.Ed. 80. Even the Supreme Court of Illinois transferred a cause to the Appellate Court to determine if the device was a slot machine and subject to confiscation.5 Similarly, here claimants may defend to determine whether there has been a violation of the statute. Furthermore, libelant should not be permitted to stipulate proof with the claimants and then ask that the court strike the answer and dismiss claimants from the suit. There can be but one conclusion that this court can reach. The motion to strike claimants' answer and dismiss them from the suit should be denied.
The court is faced with a determination as to whether these gambling devices come within the purview of the Johnson Act and are subject to seizure and forfeiture as provided therein. Section 7 of the Johnson Act provides in part as follows:
The instant suits have proceeded in accordance with 19 U.S.C.A. §§ 1602-1615, Customs Duties. Said Section 1615 provides in part as follows:
"In all suits or actions brought for the forfeiture of any * * * merchandise * * * where the property is claimed by any person, the burden of proof shall lie upon such claimant; * * * Provided, That probable cause shall be first shown for the institution of such suit or action, to be judged of by the court, * * *."
In view of this section, the government must first show probable cause for the seizures, or prima facie proof of the allegations of the libels "to be judged of by the court" before the burden of proof shifts to the claimants.6 Since it is admitted that the gambling devices are slot machines they come within the definition of gambling devices as set forth in Section 1 of the Johnson Act. The decision must then be made whether they were possessed, or used in violation of the Act. This requires proof that the claimants were dealers in gambling devices and thereby violated...
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