Respondent. )
On April 11, 1997, a formal administrative hearing was held in this case in Tallahassee, Florida, before J. Lawrence Johnston, Administrative Law Judge, Division of Administrative Hearings.
For Petitioner: Harold F. X. Purnell, Esquire
For Respondent: Miriam S. Wilkinson, Esquire
The issues in this case are whether Big Poker Twenty-One, Sure 2 Win, and Florida Twenty-One are authorized games of poker under Sections 849.085(2)(a) and 849.086(2)(a), Florida Statutes (Supp. 1996).
The Petitioner, the St. Petersburg Kennel Club, applied to the Respondent, the Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering (the Division), for approval of Big Poker Twenty-One, Sure 2 Win, and Florida Twenty- One as authorized games of poker. (Other requests for approval and other issues also raised by the Petitioner were resolved.) The requests for approval were denied on December 3, 1996, January 2, 1997, and February 14, 1997, respectively. The Petitioner timely requested formal administrative proceedings under Sections 120.569 and 120.57(1), Florida Statutes (Supp.
1996), and the matters were referred to the Division of Administrative Hearings (DOAH) as follows: Big Poker Twenty-One was referred on January 6, 1997, and assigned DOAH Case No.
97-0031; Sure 2 Win was referred on January 27, 1997, and assigned DOAH Case No. 97-0376; Florida Twenty-One was referred on April 1, 1997, and assigned DOAH Case No. 97-1667. The three cases were consolidated for final hearing.
At final hearing, the Petitioner called four witnesses: Steven Hlas, Secretary/Treasurer, St. Petersburg Kennel Club; Terry Fortino, General Partner, Aces Up Poker Consultants; Ken Kosloski; and Steve Fox, an expert witness in the game of poker. Petitioner also had 12 exhibits admitted in evidence:
Petitioner’s Exhibit #1: License to conduct card rooms at St. Petersburg Kennel Club
Petitioner’s Exhibit #5: Denial letter for Sure 2 Win Petitioner’s Exhibit #6: Denial letter for Big Poker
Petitioner’s Exhibit #8: Sure 2 Win videotape Petitioner’s Exhibit #9: Big Poker Twenty-One
Petitioner’s Exhibit #10: Florida Twenty-One videotape Petitioner’s Exhibit #11: Excerpts from Hoyle’s modern
Petitioner’s Exhibit #12: Request for approval of card games for Hollywood 2/3 Flash and Hollywood 4/3 Flash
The Respondent called two witnesses: Ken Kosloski, the cardroom administrator; and I. Nelson Rose, Esquire, an expert in the field of poker. Additionally, the Respondent had two exhibits admitted in evidence:
Respondent’s Exhibit #1: July, 1996, letter from Steve Fox to Deborah R. Miller, Director, Division of Pari- Mutuel Wagering, with suggested guidelines for defining poker
After presentation of the evidence, a transcript of the final hearing was ordered, and the parties asked for and were given 15 days from the filing of the transcript in which to file proposed recommended orders. After being confused with copies, the original transcript was not filed until June 3, and the parties’ proposed recommended orders were filed on June 6, 1997.
In a separate proceeding filed on April 30, 1997, the Petitioner challenged the validity of the Division’s proposed rule definition of “poker.” That proceeding was assigned DOAH Case No. 97-2080RP. In lieu of a formal administrative hearing, Case No. 97-2080RP was submitted for determination on proposed final orders based upon the evidentiary record created in this
case. Proposed final orders were filed on July 24 and 25, 1997, and a separate final order will be entered in that case.
During the 1996 Session of the Florida Legislature, pari-mutuel permit holders were authorized, for the first time, to operate cardrooms at their facilities on days when live racing is being conducted, effective January 1, 1997. Only certain card games were authorized, and games have to be approved by the Respondent, the Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering (the Division). Chapter 96-364, Laws of Florida (1996).
When the Division first began implementing the new cardroom statute, it anticipated that it would be receiving requests for card games as they appeared in Hoyle's Modern Encyclopedia of Card Games, by Walter B. Gibson, published by Doubleday and Company, Inc., April 1974 1st Edition (Hoyle’s).
Hoyle’s includes many games besides poker; in addition to a special section on poker, it includes special sections on pinochle and solitaire; the evidence is not clear as to the other kinds of card games in Hoyle’s.
Initially, the Division promulgated Florida Administrative Code Rule 61D-11.002(2)(a) which provides:
(2)(a) All card games in Hoyle's Modern Encyclopedia of Card Games, by Walter B. Gibson, published by Doubleday and Company, Inc., April 1974 1st Edition hereinafter (Hoyle's) incorporated herein by reference, that are authorized by and played in a manner consistent with Section 849.085(2)(a) and Section 849.086, Florida Statutes, and the rules promulgated thereunder, shall be approved by the division. All
other card games shall be approved by the division if the type of card games and the rules of the card games, as specified in BPR Form 16-001, meet the requirements of Section 849.085(2)(a) and Section 849.086, Florida Statutes, and the rules promulgated thereunder.
The Division soon noticed that it was receiving requests for the approval of games alleged to be “poker,” but which deviated from the standard features of poker. In November, 1996, the Division began to develop a policy for the review of such games and began to require card games to use standard poker card and hand ranking and afford players the opportunity to bluff after seeing their hands.
The Requests and Denials
On or about November 8, 1996, the Petitioner, the St. Petersburg Kennel Club, submitted a request for approval for Big Poker 21. The Division denied approval on December 3, 1996.
On or about December 19, 1996, the Petitioner submitted a request for approval Sure 2 Win. The Division denied approval on January 2, 1997.
On or about January 23, 1997, the Petitioner submitted a request for approval for Florida Twenty-One. The Division denied approval on February 14, 1997.
All three games are played in a non-banking manner. (The house is not a player in games played in a non-banking manner, a requirement for approval.) The Division initially simply advised the Petitioner that its proposed games were not authorized. Subsequently, in discovery depositions in this case, the Division advised the Petitioner more specifically, as follows: approval of Big Poker 21 was denied because Big Poker
21 fails to adhere to standard poker-hand rankings and does not allow for the possibility of bluffing, calling or raising; approval of Florida Twenty-One was denied because Florida Twenty- One fails to adhere to standard poker-hand rankings; and approval of Sure 2 Win was denied because in the five-card portion of Sure
2 Win, the players have no opportunity to wager or bluff after viewing the cards and simply win or lose on the hand dealt.
The Division has approved 35 out of 39 card games submitted by cardroom operators. The four denied include Sure 2 Win, Big Poker 21, Florida Twenty-One, and Pompano 22. Pompano
22 is very similar to Florida Twenty-One.
The card games, Hollywood 2-3 Flash and Hollywood 4-3 Flash, were approved by the Division on January 10, 1997. The Petitioner contends that, under the Division’s incipient policy and proposed rule, these games should not have been approved because they “do not provide for bluffing.” However, both afford players the opportunity to check or bet after seeing their first cards (the first two in 2-3 Flash, or the first four in 4-3 Flash).
The card game, Three-Card Stud, also was approved by the Division on January 10, 1997. The Petitioner contends that, under the Division’s incipient policy and proposed rule, this game should not have been approved because it does not follow the standard poker hand rankings. However, the hand rankings are consistent with the standard poker-hand-ranking system, just adapted for a three-card hand.
The Proposed Rule
Notice of a rule workshop regarding the definition of poker was published in December 1996, and a workshop was held in January, 1997.
The Division distributed a hand-out on poker at the January workshop, but the evidence is not clear as to the content of the hand-out. It appears to have been a list of seven issues for discussion, including: whether there has to be one or more betting intervals in a poker game; whether the players of poker have to be able to wager on the quality of his/her hand by either folding, calling, passing, or raising; and whether a poker game must use the standard poker hand rankings.
On March 18, 1997, the Division proposed a rule to reflect its incipient policy regarding the elements of poker on which Sure 2 Win, Big Poker 21, and Florida Twenty-One were denied, and on which other games were approved.
Standard Poker
Standard poker is a non-banking game played with cards or tiles that generally include the following features: at least part of the player’s hand is known only to the player and is solely under the player’s control; there are two or more players; there is a pot created by wagers which constitutes the prize for winning; there is a standard ranking of hands which is not arbitrary and which is based on the mathematical expectation or difficulty of achieving a particular combination of cards; there is a standard ranking of cards from lowest to highest; each
player has an opportunity to bet on the cards which comprise the player’s hand; and there are one or more betting rounds.
The fundamental element that differentiates poker from all other forms of gambling is the bluff: the possibility that a player can win the game with a hand that ranks lower than another player’s.
The game of poker is an American invention whose rules have been fairly standardized for almost a century.
There is no mention of poker in Hoyle’s 1776 text. The rules of poker developed during the 19th century. The first reference to rules for a game resembling poker is in Hoyle’s 1857 text. Although draw and stud poker did not exist in 1857, the hand rankings were the same then as they are today, only without the straight or straight flush. The straight was introduced into the ranking system below the flush at the turn of this century.
Draw poker and five-card stud developed during the Civil War, although straight poker was clearly the most important form of poker at that time. The ranking system that is in use today was firmly established by 1885.
The standard poker-hand rankings of today, given in order from highest to lowest, are as follows: five of a kind (possible only when wild cards are used), straight flush (royal flush is highest), four of a kind, full house, flush, straight, three of a kind, two pair, pair, high card.
The standard poker-card rankings of today, in order from highest to lowest, are as follows: A, K, Q, J, 10, 9, 8, 7, 6, 5, 4, 3, 2, with the ace sometimes low instead of high.
Petitioner’s Expert
On July 19, 1996, the Petitioner’s expert, Steven Fox, submitted to the Division a set of suggested revisions to the Division’s proposed cardroom rules. Fox stated that the games of poker in Hoyle’s are inappropriate for commercial cardroom use and that it was better for the State to develop its own generic standard of poker: “Attached are some of my own [generic standard of poker] on commercial poker games and a generic definition of poker for reference.”
As applied to commercial poker games, the features of poker that Fox suggested the Division use as a guideline “to evaluate whether a game should be classified as poker” include:
(a) usually played with cards; (b) cards are ranked from designated lowest or worst to highest or best; (c) there is a ranking system which assigns relative value to each player’s combination of cards, where the ranking system is not arbitrary and is based on the mathematical expectation for receiving each combination; (d) each player can participate in the action based upon cards solely under his control . . . and knowledge of other players’ habits or styles; (e) at least some of the cards under a player’s control are known only to him; (f) each player has the opportunity to bet on the cards which comprise his hand and there may be more than one betting round; and (g) players bet against the relative holdings of other players.
In his July 1996 materials Fox suggested that the Division consider the traditional poker ranking system of cards, in order from lowest or worst to highest or best, as follows: 2,
3, 4, 5, 6, 7, 8, 9, 10, Jack, Queen, King, Ace. “The Ace shall be treated as a one in low poker and in low straight sequences (A, 2, 3, 4, 5). Otherwise it will be assumed to be valued higher than all the other cards in assuming standard 52 card deck.” This is the exact same card ranking system listed in Hoyle’s.
In his July 1996 materials, Fox suggested that the Division consider the traditional poker-ranking system of hands in descending order of value as: five aces (includes the joker when available), straight flush, four of a kind, full house, flush, straight, three of a kind, two pair, one pair, no pair (high card). This is the same hand-ranking system listed in Hoyle’s.
At final hearing, Fox testified that it is “extremely difficult to pin down what exactly is poker”; that poker hand rankings are arbitrary and established by agreement of the players, i.e., “whatever the players want”; and that, because of the $10 pot limitation, games in Florida lend themselves more to “home-style” or “showdown” games. When questioned on cross- examination about these apparent contradictions, Fox asserted that his definition as submitted to the Division in July 1996, was “something that I used in more of the casino versions of poker, and I use this as a suggestion so that people can understand a casino version of poker.”
But, nowhere in Fox’s July 1996 materials, does he state, suggest, or infer that his definition of poker is a “casino version” of poker, or that his definition would be
inappropriate for use in Florida because of the $10 pot limitation. To the contrary, it was Fox’s desire that the Division incorporate his suggested definition of poker into its regulations. At the time he submitted his suggested definition of poker to the Division in July 1996, Fox was fully aware of the
$10 pot limitation in Florida.
Fox was paid by the Petitioner to provide expert testimony on its behalf at the hearing in the case at bar. Fox was not paid by the Petitioner for his proposed revisions and definition of poker submitted to the Division in July 1996.
Dealer’s Choice Games
Included among the poker games described in Hoyle’s are many dealer’s choice poker games. According to Hoyle’s, these games “run the gamut from mere variants of standard games to those that are wild beyond belief.” Some of these games— including Jacks High, Lalapalooza, Low Poker, One Card Poker, Place Poker, Second Hand Low, Tens High, Two Card Poker, and Zebra Poker—vary from the standard poker-hand rankings. Others— including High Spade Split, Jacks High, Tens High, and Zebra Poker—vary from the standard poker-card rankings. Some—including Cold Hands, Cold Hands Poker with a Draw, Blind Poker, and Show Down Poker—do not afford players the opportunity to bluff after seeing their hands.
There also are other homestyle, dealer’s choice “poker” games, not listed in Hoyle’s, which do not conform to the Division’s definition of poker. These include 727 and 333, in which the object is to obtain a certain numerical total by adding
the point values of cards.
It was reasonable for the Division to want to narrow the definition of “poker” through its incipient policy and proposed rule. If all of the homestyle dealer’s choice poker games described in Hoyle’s (and games like them) were authorized, there would in effect be no definition of poker at all; whatever a dealer called poker would be poker.
Big Poker Twenty-One and Florida Twenty-One
Big Poker Twenty-One and Florida Twenty-One do not conform to the standard poker card ranking system. Face cards are all given exactly the same rank or value; each is worth 10 points, while aces are worth 1 or 11 points.
The object of both Big Poker Twenty-One and Florida Twenty-One is to total 21 points, or as close to 21 points as possible, by adding the point values of cards. Players accumulate cards by drawing cards face up until a certain point value is reached, whereupon they “stand.”
Big Poker Twenty-One and Florida Twenty-One both allow for an automatic win if the player’s first two cards total 21 points. An ace-king, ace-queen, ace-jack, and ace-10 each total
21 and are automatic winners. There are no automatic wins in poker.
Big Poker Twenty-One and Florida Twenty-One both restrict the player’s ability to draw cards. This restriction is based on the point total. A player who accumulates 20 points is not allowed to draw any more cards. The game of poker does not
restrict a player’s ability to draw cards simply because the player has attained a particular hand.
There is no possibility of bluffing in Big Poker Twenty-One since players make their bets before they view their cards.
It was reasonable for the Division to decide that neither Big Poker Twenty-One nor Florida Twenty-One are poker. Instead, they are variations of the game of Black Jack, or “Twenty-One,” as it is often called. Black Jack developed in the 1850s and was often played in a non-banking manner. It is still sometimes played today in a non-banking manner.
Sure 2 Win
The five-card hand, or “showdown” portion, of Sure 2 Win violates the fundamental rule of poker that players have to be able to make a bet after viewing their cards so that bluffing is possible. All participants must participate in the “showdown” portion. In the “showdown” portion of the game, the players wager before viewing their cards, which are then turned up to reveal the winning hand, with no further opportunity to bet.
The winner of the showdown portion of Sure 2 Win wins strictly by chance since the player has no control over the deal of the cards, no opportunity to view the cards before making a bet, no opportunity to bluff, no opportunity to draw cards in order construct a higher ranked hand, and no control over the outcome of the showdown portion.
The player who wins in the showdown portion of the game is not eligible to play the seven-card portion of the game.
Other players can decide whether to bet on the seven-card portion of the game; however, that decision has absolutely no effect on the outcome of the five-card portion of the game.
It was reasonable for the Division to decide that Sure
2 Win is not poker. The five-card showdown portion of the game is strictly a game of chance, and the winner cannot play the second, seven-card portion.
CONCLUSIONS OF LAW
Section 849.086(2)(a), Florida Statutes (Supp. 1996), defines authorized games as “those games authorized by s. 849.085(2)(a) and which are played in a non-banking manner.”
Section 849.085(2)(a), Florida Statutes (1995), authorizes “Penny-ante games” and defines them as follows:
“Penny-ante game” means a game or series of games of poker, pinochle, bridge, rummy, canasta, hearts, dominos, or mah-jongg in which the winnings of any player in a single round, hand, or game do not exceed
$10 in value.
Florida Administrative Code Rule 61D-11.002 requires all card games be approved by the Division and provides in pertinent part:
(2)(a) All card games in Hoyle's Modern Encyclopedia of Card Games, by Walter B. Gibson, published by Doubleday and Company, Inc., April 1974 1st Edition hereinafter (Hoyle's) incorporated herein by reference, that are authorized by and played in a manner consistent with Section 849.085(2)(a) and Section 849.086, Florida Statutes, and the rules promulgated thereunder, shall be approved by the division. All other card games shall be approved by the division if the type of card games and the rules of the card games, as specified in BPR Form 16-001, meet the requirements of Section 849.085(2)(a) and Section 849.086, Florida Statutes, and the rules promulgated thereunder.
As found, Hoyle’s includes many games besides poker. It would appear that Florida Administrative Code Rule 61D- 11.002(2)(a), as written, contemplated the approval of all poker games in Hoyle’s, so long as they are played in a non-banking manner. The Petitioner argues that, because its proposed games are similar to dealer’s choice poker games in Hoyle’s, the Division should approve them. However, the preliminary denials
in this case reflect the Division’s incipient policy to require a game to use the standard poker card and hand rankings and afford players the opportunity to bluff after seeing their hands in order to be considered “poker.” Even if the Division’s approvals of Hollywood 2-3 Flash, Hollywood 4-3 Flash, and Three-Card Stud on January 10, 1997, were contrary to the Division’s incipient policy, raising a question as to how definite and firm the policy was at that time, it clearly has become the agency’s incipient policy. As found, after the preliminary denials, the Division proposed a rule to promulgate this incipient policy. Under the incipient policy and proposed rule, the Petitioner’s proposed games, as well as some of the poker games described in Hoyle’s (in particular several of the “dealer’s choice” games) would not be authorized.
As found, it was reasonable for the Division to want to narrow the definition of “poker.” If all of the dealer’s choice poker games described in Hoyle’s (and games like them) were authorized, there would in effect be no definition at all; whatever a dealer might call poker would be poker. Such a result would not be reasonable.
The Division’s incipient policy was supported by competent substantial evidence presented at final hearing. Although it would eliminate many dealer’s choice games in Hoyle’s, it incorporates the characteristics of standard poker described in Hoyle’s. It also is supported by expert testimony as to the characteristics of standard poker. See St. Francis Hospital, Inc., v. Dept. of Health, etc., 553 So. 2d 1351, 1354 (Fla. 1st DCA 1989). (The validity of the Division’s proposed rule incorporating the incipient policy will be determined in Case No. 97-2080RP.)
As found, regardless of the Division’s incipient policy and proposed rule, it was reasonable for the Division to decide that neither Big Poker 21 nor Florida Twenty-One are poker. Instead, they are variations of the game of Black Jack, or “21.”
As found, regardless of the Division’s incipient policy and proposed rule, it was reasonable for the Division to decide that Sure 2 Win is not poker. The five-card showdown portion of the game is strictly a game of chance, and the winner cannot play the second, seven-card portion.
RECOMMENDED that the Respondent, the Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering enter a final order denying approval of Big Poker Twenty-One, Sure 2 Win, and Florida Twenty-One as authorized games of poker
under Sections 849.085(2)(a) and 849.086(2)(a), Florida Statutes (Supp. 1996).
RECOMMENDED this 5th day of August, 1997, at Tallahassee, Leon County, Florida.
J. LAWRENCE JOHNSTON Administrative Law Judge
Filed with the Clerk of the Division of Administrative Hearings this 5th day of August, 1997.
Miriam S. Wilkinson, Esquire Department of Business and
Harold F. X. Purnell, Esquire Rutledge, Ecenia, Underwood,
Deborah R. Miller, Director Division of Pari-Mutuel Wagering Department of Business and
Lynda L. Goodgame General Counsel
All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.
