KEHOE, J.
The primary dispute in this case is whether a 2012 amendment to the State's gaming law violates the Maryland constitutional prohibition against "special laws."
At issue is chapter 603 of the Acts of 2012, which, among other things, amended the statutory definition of "slot machine" in ways that rendered unquestionably illegal the gaming machines that CCI asserts had been legal up to that time. CCI contends that § 3 of chapter 603 is a "grandfather" provision that exempted a small number of existing entities—but not it—
CCI filed suit in the Circuit Court for Anne Arundel County against the State seeking declaratory and injunctive relief. Pertinent to this appeal, CCI alleged that: 1) § 3 of chapter 603 is a "special law" and violates Article III, § 33 of the Maryland Constitution; 2) the same provision offends equal protection principles by treating CCI differently from similarly-situated businesses without any legitimate, rational basis; and 3) chapter 603, when applied to it, constitutes an unconstitutional taking of CCI's property. The State contested all of these allegations.
In discovery, CCI sought to obtain documents and emails in the possession of the General Assembly related to the drafting and consideration of Senate Bill 864, which, when enacted, became chapter 603. The circuit court ordered the General Assembly to disclose certain documents for in camera review, and denied CCI's remaining discovery requests. The State filed an interlocutory appeal of this order. CCI asserts that the circuit court erred in restricting its ability to obtain the discovery it requested. The State contends that the circuit court's order compelling the General Assembly to disclose documents for in camera review violated "the State's sovereign immunity, the speech and debate clause, and the absolute legislative privilege of the General Assembly and its members."
After an evidentiary hearing, the court denied CCI's request for a preliminary injunction. The parties then stipulated to an order consolidating the preliminary injunction proceedings with a trial on the merits and the circuit court entered final judgment in favor of the State. CCI appealed and its appeal and the State's appeal were consolidated by this Court, with the State designated as appellee/cross-appellant.
CCI raises the following issues, which we have re-worded:
The State presents the following issue in its cross-appeal:
We will affirm the judgment of the circuit court. Turning first to the special law issue, and applying the analysis articulated in Cities Service v. Governor, 290 Md. 553, 431 A.2d 663 (1981), and MDE v. Days Cove, 200 Md.App. 256, 27 A.3d 565 (2011), we hold that chapter 603 is not a special law. We also conclude that chapter 603 does not violate CCI's equal protection and due process rights. The circuit court's discovery rulings did not prejudice CCI
In order to provide context to the parties' assertions, it is necessary for us to set out the complicated legal and factual background to the current dispute, a task that will involve a fair amount of slow drilling through hard wood.
The operation of slot machines has been regulated by statute in Maryland since 1963. The original regulations were enacted by ch. 617 of the Acts of 1963 and codified at Md.Code (1957), Art. 27, § 264B. The act provided that: "It shall be unlawful for any person, firm or corporation to locate, possess, keep, maintain or operate any slot machine within this State..., except as provided in [other parts of the statute]." Art. 27, § 264B(I). The act defined "slot machine" as follows (emphasis added):
Art. 27, § 264B. The act's purpose was: "to define the term `slot machines,' [and] to make it unlawful to possess or operate such machines except for a specified period in the four Southern Maryland Counties [Calvert, St. Mary's, Anne Arundel, and Charles Counties] during which these machines were to be gradually decreased year by year and `providing for the gradual and eventual total abolition ... of all slot machines within this State.'" Clerk of Circuit Court for Calvert County v. Chesapeake Beach Park, Inc., 251 Md. 657, 661, 248 A.2d 479 (1968) (quoting ch. 617 of the Acts of 1963); see also State v. 149 Slot Machines, 310 Md. 356, 365, 529 A.2d 817 (1987) ("[T]he General Assembly intended a total abolition of slot machines adapted for gambling."). Although § 264B was amended in 1981 and 1983, the definition of slot machine remained substantively unaltered. See State v. 158 Gaming Devices, 304 Md. 404, 407 n. 1, 499 A.2d 940 (1985) (quoting ch. 540 of the Acts of 1983); ch. 280 of the Acts of 1981.
At the time that Article 27 § 264B was enacted, there was no State-wide licensing system for slot machine operations. Instead, some counties had local law provisions permitting them to grant licenses.
On February 13, 2001, the Court of Appeals issued its opinion in Chesapeake Amusements v. Riddle, 363 Md. 16, 766 A.2d 1036 (2001). The issue in Chesapeake Amusements was "whether a dispensing machine with a video screen that displays the contents of the [paper] tickets that it dispenses and emits a musical tone that signals when a winning ticket is being dispensed is a `slot machine'" as defined by § 264B. Chesapeake Amusements, 363 Md. at 18, 766 A.2d 1036. The parties in that case did not dispute that the machine—called the Lucky Tab II—offered a form of "instant bingo." The parties stipulated that the game of instant bingo involved pre-printed bingo tickets, some of
Id. at 21, 766 A.2d 1036. The parties provided an agreed statement of facts explaining how "instant bingo" was played using the Lucky Tab II machine:
Id. at 22, 766 A.2d 1036. The parties further agreed that: "it is only on the basis of the symbols that appear on the inside of the paper ticket that a winning ticket is determined," and, thus, that "the symbols that are displayed on the video screen are not used to determine whether the customer is entitled to a prize." Id.
In reversing the circuit court's conclusion that the Lucky Tab II was a slot machine under § 264B, the Court emphasized that, in order to constitute a slot machine, the statute required there to "be consideration supplied by the user on the possibility that he or she will receive a prize `by reason of' the unpredictable operation of the machine." Chesapeake Amusements, 363 Md. at 30, 766 A.2d 1036 (quoting § 264B). The Court observed that, in contrast to this requirement, "[t]he Lucky Tab II machine d[id] not pick the paper pull-tab tickets sold in a random fashion," and, instead, "dispensed [tickets] in sequence from the deal placed into it by [the operator's] employee." Id. For this reason, among others, the Court reasoned that "it is with the paper pull-tabs with which the game is played," id. at 31, 766 A.2d 1036, and not the visual images depicted on the monitor nor the machine's audio accompaniment. See id. ("The player enhancement features, the video and audio, respond only to the information contained in the paper pull tabs, and, therefore, have no ability to affect the outcome of the game; the outcome of the game is set once the paper pull-tab is purchased non-randomly."). Because the "element of chance [was] in the pull-tabs themselves, and not in the operation of the machine," the Court concluded that the Lucky Tab II was not a slot machine. Id. at 41, 766 A.2d 1036.
By chapter 26 of the Acts of 2002, Maryland's criminal law statutes were recodified as the Criminal Law Article and Art. 27, § 264B was re-codified at Md.Code (2002) § 12-301 of the Criminal Law Article ("CR").
In this subtitle:
Section 13 of chapter 26 explained that, "except as expressly provided in this Act, this Act shall be construed as a nonsubstantive revision, and may not otherwise be construed to render any substantive change in the criminal law of the State."
In 2008, the General Assembly enacted, and the Governor signed into law, Senate Bill 959 (chapter 474 of the Acts of 2008) ("SB 959" or "the 2008 law").
In this subtitle:
The bill also expressly excluded certain types of machines from this definition. To this end, § 12-301(3) provided in relevant part (emphasis added):
Two other provisions of the 2008 law are pertinent to the present case.
First, CR § 13-101(b) prohibited counties from issuing new bingo licenses to entities "not licensed to conduct commercial bingo on or before June 30, 2008." Thus, the bill effectively closed the class of those operating pursuant to commercial bingo licenses issued on the county level.
Second, the 2008 law contained an uncodified temporary grandfather provision. Section 2 of the act stated (emphasis added):
The bill went into effect on July 1, 2008.
On June 26, 2008, that is, after the enactment and approval of the 2008 law but prior to § 13-101(b)'s cut-off date for new licensees, CCI obtained a NG Beach Bingo License from Calvert County for the Crooked I Bar & Grill, an establishment located in Chesapeake Beach, Calvert County, Maryland. (CCI initially applied
The trial court found, and the parties do not dispute on appeal, that CCI's machines did not offer a game of "instant bingo" as described in Chesapeake Amusements.
In appearance and from the perspective of a user, CCI's machines were nearly indistinguishable from video slot machines.
CCI's machines were pre-programmed to deliver a certain payout percentage—
Before it began operations, CCI's representatives met with the State's Attorney for Calvert County on several occasions regarding whether its machines complied with Maryland law. On December 11, 2008, the State's Attorney wrote CCI, stating that she believed that the proposed machines offered a form of "bingo" but that there was a degree of uncertainty about the matter, and that, as a result, she had requested advice from the Attorney General's Office.
On January 15, 2009, then-Assistant Attorney General Robert N. McDonald, Chief Counsel of the Opinions and Advice division of the Attorney General's Office,
(citing § 12-301(3)(iv)). On April 30, 2009, Mr. McDonald issued a second advice letter responding to and rejecting several additional claims made by CCI. The analysis
In May of 2009, CCI began operating approximately 105 electronic bingo machines at the Crooked I Bar & Grill. Almost immediately thereafter, concerns arose about the legality of CCI's machines. We will describe these later.
Meanwhile, the General Assembly passed House Bill 193, chapter 661 of the Acts of 2009, which amended the uncodified temporary grandfather provision of chapter 474 in two pertinent ways. First, the bill extended chapter 474's temporary grandfather provision for electronic machines offering instant bingo to July 1, 2012. Second, it amended the class of machines recognized by the instant bingo grandfather clause. To this end, chapter 661 provided (amendments emphasized):
Additionally, chapter 661 § 4 stated:
In November of 2009, Thomas V. Mike Miller, Jr., President of the Maryland Senate, requested advice from the Attorney General's Office as to the legality of certain electronic bingo machines being operated in establishments located in Calvert and Anne Arundel Counties.
On November 16, 2009, Attorney General Douglas F. Gansler replied to Senate President Miller. In his letter, Mr. Gansler stated that:
(Citations omitted). Mr. Gansler also observed that:
Against this backdrop, Attorney General Gansler responded to several questions posed by Mr. Miller, explaining, in relevant part, that:
(internal citations omitted). And that (emphasis added):
On December 1, 2009, in a letter addressed to the State's Attorney for Calvert County, CCI owner Ryan Hill responded, in part, to Attorney General Gansler's November 16th letter. Mr. Hill expressed his belief that CCI was "currently operating games that we believe [the State's Attorney's Office] found to be compaliant and [that are] also acceptable by the Attorney General's [O]ffice." Mr. Hill also stated that he disagreed with the Attorney General's view that the slot machine exemption found in § 12-301(3)(iv) applied only to those machines operating pursuant to a "live call" of bingo numbers.
and that the bill was subsequently amended to the form eventually codified at § 12-301(3)(iv) (emphasis added):
This legislative history, according to Mr. Hill, supported CCI's theory that "[n]o temporal proximity between the calling and the marking can be inferred from [the language of § 12-301(3)(iv)]"—in other words, that § 12-301(3)(iv) did not require a contemporaneous "live call" of bingo numbers.
Mr. Hill did not, however, state or even suggest that CCI's electronic bingo machines satisfied the "mark and monitor" requirement of § 12-301(3)(iv), nor did he respond to the Attorney General's determination that the § 12-301(3)(iv) exclusion did not apply to machines, such as those being operated by CCI, which "electronically
On March 10, 2011, an agent from the Field Enforcement Bureau of the Comptroller's Office visited CCI's premises.
On May 6, 2011, the State's Attorney wrote a letter to Senate President Miller in which she highlighted the conclusions of the Comptroller's agent, identified purported inconsistencies between advice given by the Attorney General's Office as to the legality of certain types of electronic bingo machines, and explained her view that (emphasis in original):
On October 17, 2011, in response to a subsequent inquiry from Senate President Miller as to the legality of the electronic bingo machines being operated at the Crooked I, Assistant Attorney General Rowe advised that CCI's electronic bingo machines constituted slot machines under
All this is as preamble. We now turn to the legislation that sparked the case before us.
During the 2012 legislative session, the House of Delegates considered House Bill 927. The bill, apparently introduced at CCI's request and certainly supported by it, proposed to make permanent the temporary grandfather provision for machines offering instant bingo and to expand it to include other types of electronic bingo machines—such as the ones operated by CCI—that did not offer the game of instant bingo. Specifically, the bill proposed to codify the following grandfather provision at CR § 12-308 (emphasis added):
HB 927 was passed by the House of Delegates but it received an unfavorable report by the Senate Budget and Taxation Committee—of the committee's thirteen members, one was absent and the other twelve voted against it—and was never acted upon by the Senate.
In the same session, the General Assembly passed Senate Bill 864 (chapter 603 of the Acts of 2012), which was signed into law by Governor O'Malley shortly thereafter. In addition to a number of changes not directly relevant to the issues before us, chapter 603 amended § 12-301(3)(iv)—which provided that the definition of slot machine excluded electronic bingo card minders—to address the perceived ambiguities in the statute. This amendment was in response, at least in part, to the
Victoria Gruber, Senate President Miller's Chief of Staff, testified in favor of SB 864 before the Senate Budget and Taxation Committee. She stated, in pertinent part (emphasis added):
In a similar vein, Senator James DeGrange, Sr., SB 864's sponsor, in written testimony, explained to the House Ways & Means Committee that SB 864 "clarifies the definition of a bingo card minder as an exception to the definition of illegal gaming device consistent with the intent of the 2008 law."
As enacted, chapter 603 amended the definition of "slot machine" in § 12-301 to read, in pertinent part, as follows (amendments emphasized):
Chapter 603 added § 12-208, which stated (amendments emphasized):
The language in § 12-308 tracked the language of the previous uncodified temporary grandfather provisions for instant bingo operators established in 2008 by Chapter 474 of the Laws of 2008 and extended for an additional year by Chapter 661 of the Laws of 2009, thus changing what had been a temporary reprieve into a permanent exemption. Section 12-208 did not benefit CCI for two reasons: first, it was not licensed or in operation as of December 31, 2007; second, its machines did not offer games of instant bingo.
Chapter 603 contains several uncodified sections, two of which are pertinent to the present case. Section 3 states (emphasis added):
Section 4 provides (emphasis added):
The bill went into effect on July 1, 2012.
At this stage in the proceeding, there is no dispute that CCI's electronic bingo machines are slot machines under § 12-301, as amended by chapter 603, and that they do not fall within any of the enumerated
On June 21, 2012, CCI filed a nine-count complaint in the Circuit Court for Anne Arundel County, seeking an injunction and a declaration that uncodified § 3 of chapter 603 was an unconstitutional special law, that it violated equal protection principles, that it was a taking of property without due process, that it violated CCI's procedural due process rights, that it was unconstitutionally vague and overbroad, and that it violated Maryland's prohibition against ex post facto laws and monopolies granted by the State. These claims rested primarily on CCI's assertion that the effect of chapter 603 was that CCI was prohibited from continuing its electronic bingo operations, while the six other establishments operating electronic bingo machines in Calvert and Anne Arundel Counties were permitted to continue their operations.
On June 29, 2012, the circuit court entered a temporary restraining order, and the matter was set in for a hearing on CCI's request for a preliminary injunction.
The circuit court denied CCI's remaining discovery requests. That same day, the State noted an appeal from this order.
On July 16 and 18, 2012, the circuit court held an evidentiary hearing on CCI's request for a preliminary injunction. We will discuss the pertinent evidence in our analysis. On the day after the hearing concluded, the court issued a memorandum opinion and order denying CCI's request for a preliminary injunction. The court concluded that chapter 603 was not a special law targeted at the Crooked I Bar & Grill, and denied CCI's remaining claims.
First, the court observed that "instant bingo" was not defined in CR § 12-301 et seq. The court determined that, even though the definition of "instant bingo" used by the Court of Appeals in Chesapeake
Third, the circuit court concluded that the testimony of Christopher Russell, one of CCI's principals, that CCI's machines offered bonanza bingo, constituted "a judicial admission . . . that [CCI's] devices are not instant bingo." Fourth, the court observed that CCI did not dispute that its machines were part of an "integrated system" and that "the machines played by all customers simultaneously make use of an electronically-transmitted, pre-recorded call of bingo numbers." In light of these observations, the court concluded that CCI's machines did not offer "instant bingo" and, therefore, that they did not fall within the scope of the § 12-308 instant bingo grandfather clause.
The circuit court also rejected CCI's equal protection and takings claims and adopted by reference "the arguments presented in the State's Opposition memorandum, docketed herein on June 12, 2012. . . ." We will discuss the equal protection and takings contentions in Parts II and III.
Thereafter, the parties stipulated that the court's ruling on CCI's request for a preliminary injunction should be consolidated with the trial on the merits. The court entered judgment in accordance with the stipulation. This appeal followed. Subsequently, CCI's appeal and the State's prior appeal were consolidated so that both are before us.
CCI does not challenge any of the findings of fact made by the circuit court. We review the circuit court's application of law to the undisputed facts in this case de novo. See, e.g., Reichs Ford Road Joint Venture v. State Roads Comm'n, 388 Md. 500, 509, 880 A.2d 307 (2005). In interpreting a statute, our goal is to discern the legislature's intent. Breslin v. Powell, 421 Md. 266, 286, 26 A.3d 878 (2011). We look to the plain language of the statute, giving it its natural and ordinary meaning, State Dep't of Assessments & Taxation v. Maryland-Nat'l Capital Park & Planning Comm'n, 348 Md. 2, 13, 702 A.2d 690 (1997), and read the statute in the context of its statutory scheme. Breslin, 421 Md. at 287, 26 A.3d 878.
Article III, § 33 of the Maryland Constitution provides, in pertinent part, that "the General Assembly shall pass no special Law, for any case, for which provision has been made, by an existing General Law." While the prohibition against special legislation may serve other interests,
The issue before the Court in Cities Service was whether a provision in a statute
The Court began its analysis by noting that, although the concept of a special law had been articulated in various ways in earlier cases, "`[a] special law is one that relates to particular persons or things of a class, as distinguished from a general law which applies to all persons or things of a class.'" Id. at 567, 431 A.2d 663 (quoting Prince George's County v. B. & O.R. Co., 113 Md. 179, 183, 77 A. 433 (1910)) (brackets added by Cities Service); see also Jones v. Anne Arundel County, 432 Md. 386, 403, 69 A.3d 426 (2013) ("Special laws `relate[ ] to particular persons or things of a class, as distinguished from a general law which applies to all persons or things of a class,' and are enacted `for the relief of particular named parties, or providing for individual cases.'" (internal citations omitted; quoting Prince George's County v. B & O, 113 Md. at 183, 77 A. 433, and Montague v. State, 54 Md. 481, 490 (1880))). In determining whether a law relates to particular entities within a legislatively-established class, instead of to the class as a whole, the Court of Appeals observed that its prior decisions had "pointed to various considerations and factors, although certainly no one is conclusive in all cases." Cities Service, 290 Md. at 569, 431 A.2d 663. These included:
Id. at 569-70, 431 A.2d 663; see also Green v. N.B.S., Inc., 409 Md. 528, 544-45, 976 A.2d 279 (2009) (citing Cities Service); Days Cove, 200 Md.App. at 265-66, 27 A.3d 565 (quoting and applying the Cities Service factors).
290 Md. at 570-72, 431 A.2d 663.
After concluding that the mass merchandiser exception was a special law, the Court decided that the appropriate remedy was not to declare the mass merchandiser exemption invalid but rather to sever the offending dates from the statute. Id. at 577, 431 A.2d 663.
In Days Cove, this Court applied the Cities Service analysis and concluded that chapter 161 of the Acts of 2007, which amended Md.Code (1987, 2007 Repl., 2010 Supp.) § 9-204(m) of the Environment Article ("EN"), did not constitute a special law. 200 Md.App. at 282, 27 A.3d 565. Days Cove had leased a parcel of land near Unicorn Lake in Queen Anne's County with the intention of constructing and operating a rubble landfill. Id. at 259-60, 27 A.3d 565. Thereafter, the General Assembly amended EN § 9-204 to prohibit the issuance of:
Id. at 261, 27 A.3d 565 (quoting EN § 9-204).
Days Cove filed suit challenging the amendment, arguing that the statute constituted an unconstitutional special law. The circuit court agreed. This Court reversed, explaining that EN § 9-204 was not a special law because it applied generally to prohibit the issuance of a permit to any party desiring to construct a rubble landfill within four miles of Unicorn Lake, or the other articulated waterways, and that it was "not expressly or impliedly intended to benefit or burden Days Cove alone." Id. at 273, 27 A.3d 565. We observed that although the law "may immediately affect only Days Cove's pending permit application, that fact alone . . . is not sufficient to render it a special law." Id. at 276, 27 A.3d 565. We distinguished the facts of that case from those of Cities Service, stating:
Id. at 275-76, 27 A.3d 565.
In applying the Cities Service factors, and although neither that opinion nor Days Cove expressly articulated the principle, we begin with the presumption that the legislative enactment is constitutional. See, e.g., Walker v. State, 432 Md. 587, 626, 69 A.3d 1066 (2013) ("We begin with a presumption that the statute is constitutional, and the burden rests on Petitioner to show why that is not the case."); Maryland Aggregates Ass'n, Inc. v. State, 337 Md. 658, 673, 655 A.2d 886 (1995) (Courts "accord to the decisions of legislative bodies a strong presumption of constitutionality."). This deference extends to the General Assembly's determination that an exception to the application of a general law is necessary. See Jones v. House of Reformation, 176 Md. 43, 57, 3 A.2d 728 (1939) ("In cases of state constitutional prohibition against the passage of special laws where a general law may be made applicable, it is a rule that the question of applicability * * * is one for the Legislature to determine, and that such a statute will not be declared unconstitutional, except where it clearly appears that the Legislature was mistaken in its belief that a general law could not be made applicable." (Citations omitted.)). Writing for the Court in Williams v. Mayor & City Council of Baltimore, 289 U.S. 36, 46, 53 S.Ct. 431, 77 L.Ed. 1015 (1933), Justice Cardozo concluded that the decisions of the Court of Appeals applying § 33 made it clear that:
At the outset, we note that there are factual weaknesses in CCI's special law argument. CCI's arguments rest on two factual premises: first, that its machines are "materially identical" to the machines of the other commercial bingo enterprises, and, second, that its machines complied with State law, specifically, § 12-301(3)(iv), until the 2012 amendment. On the record before us, and in light of the findings of the circuit court, both of these assertions are, at best, problematic.
As to the first matter, according to the testimony of CCI's own expert, CCI's machines operate "from a technical perspective" in a fashion distinguishable from the machines of the other establishments—in other words, CCI's machines are, in fact, different than the machines of the other establishments in some ways. Although he acknowledged the existence of these technical differences, CCI's expert did not identify nor explain them, nor did he describe in any particular detail how the other businesses' electronic bingo machines operated.
Much the same can be said of CCI's assertion that its machines complied with the requirements of the "bingo card minder" exception to the definition of slot machine found in § 12-301(3)(iv) from the time that section was added to the statute in 2008 until the section was amended in 2012. CCI presented evidence that bingo numbers for its machines were generated by a live—even though not a contemporaneous—call, which, it asserts, satisfied the 2008 law's requirement that "numbers be called on the premises by an individual where the user is operating the machine. . . ." But CCI presented no evidence that its machines met the other requirement, viz., that users, and not the device itself, marked and monitored the bingo cards displayed on the machine. As the circuit court noted in its opinion:
Although this suggests that the circuit court concluded that CCI's machines did not meet the 2008 version of § 12-301(3)(iv)'s "mark and monitor" requirement, it did not make an explicit finding on the matter. Similarly, the circuit court did not make explicit findings as to whether CCI's machines functioned in the same manner as its competitors. We will not base our decision on these matters but, nonetheless, the 2012 law is presumptively valid and CCI bears the burden to demonstrate otherwise. Its inability to present probative evidence as to matters critical to its argument is telling.
We now turn to the Cities Service factors.
As this Court explained in Days Cove, "If an act expressly states that it applies only to a particular, named individual or entity, it may run afoul of Article III, § 33. So may `equivalent' means of identifying a particular individual." 200 Md.App. at 271, 27 A.3d 565 (quoting Reyes v. Prince George's County, 281 Md. 279, 305-306, 380 A.2d 12 (1977)).
CCI's contentions can be summarized thus:
Uncodified § 3 of the 2012 law is a grandfather provision that allows all commercial bingo operators other than it to continue to offer electronic bingo games that would otherwise have been prohibited by the 2012 law's amendment to § 12-301(3)(iv). The 2008 law, which prohibited further licensing of commercial bingo operations and expanded the definition of "slot machine" to include devices that, "through the element of chance, reading of a game of chance, delivery of a game of chance or any other outcome unpredictable to the user," established a closed class of seven commercial electronic bingo machine operators, including it. CCI's machines functioned in the same way as did those operated by the six other licensed bingo establishments and all of these machines were rendered illegal by the 2012 amendment to § 12-301(3)(iv), which narrowed the scope of the "bingo card minder" exemption to the definition of slot machine. Uncodified § 3 of the 2012 law permits all licensed commercial bingo operators in the State, other than CCI, to continue to operate electronic bingo machines that would otherwise be prohibited. In CCI's view, the February 28, 2008 date is the equivalent
In response, the State argues that CCI misreads § 3. It asserts that: (1) the section applies only to "longstanding licensed operators of the instant electronic bingo machines held lawful in Chesapeake Amusements" and (2) § 3 does nothing more than to "permit those authorized machines to be repaired or replaced under the supervision of the [State Lottery and Gaming Control] Commission, which is tasked with certifying that any `electronic bingo machine being authorized for use after January 12, 2013, complies with all applicable laws' as of July 1, 2012." See CR § 12-301.1.
We begin with the 2008 law. As is relevant to the question before us, the law authorized the use of two types of electronic bingo machines. First, the temporary grandfather provision authorized entities satisfying certain requirements to "continue to operate a game of instant bingo . . . using electronic machines . . ." for a period of approximately six months.
The 2009 law made minor, and in our view irrelevant, changes to the 2008 law's temporary grandfathering provision. The 2009 law did not amend the bingo card minder exemption, nor did it add or remove a classification of "machines" authorized for use in bingo games. Thus, as in 2008, the only machines authorized for use after the effective date of the 2009 law were bingo card minders and those offering "instant bingo."
As in the 2008 and 2009 laws, the 2012 law's grandfathering provision, codified at § 12-308, authorizes entities satisfying certain requirements to "continue to operate a game of instant bingo . . . using electronic machines. . . ." The 2012 law made only minor changes to the scope of the class covered by the existing grandfathering provision. The 2012 law also narrowed the bingo card minder exception, codified at § 12-301(3)(iv), by imposing additional restrictions on the type of machines that fall within the exception. As with the 2008 and 2009 laws, §§ 12-301(3)(iv) and 12-308 recognize two, and only two, categories of electronic bingo machines: electronic bingo card minders and electronic machines offering "instant bingo."
CCI's machines do not satisfy the requirements for inclusion in either of these two classes. At this stage in the litigation, there is no dispute that CCI does not operate machines offering "instant bingo." Likewise, there is no dispute that CCI's machines do not satisfy the requirements of the 2012 law's bingo card minder exception.
To get around this problem, CCI suggests that the 2012 law established a third category of permitted machines, one that includes all "electronic bingo machines" of any variety, to which it rightfully belongs. In support of this position, CCI concentrates
The problem with CCI's interpretation of the term "electronic bingo machine" is that it is irreconcilably in conflict with § 12-301(3)(iv). Were we to interpret uncodified § 3 as establishing a new class of "electronic bingo machines" of any variety, the new class would encompass both electronic machines offering "instant bingo" and bingo card minders. The result would be that the qualifying dates contained in uncodified § 3 would apply to both of these classes of machines. While the qualifying dates in § 3 correspond to the qualifying dates of the instant bingo grandfathering provision, they directly conflict with the statute's authorization in § 12-308(3)(iv) for the use of bingo card minders because that section contains no qualifying dates whatsoever.
In our view, a better interpretation of uncodified § 3 is that it applies solely to those machines that fall within the scope of § 12-308's grandfathering provision. While not identical, the language employed in both provisions is similar: "electronic machines" (§ 12-308) and "electronic bingo machines" (uncodified § 3). The qualifying dates employed in uncodified § 3 echo those found in the § 12-308 grandfathering provision, and act to ensure that the class of operators operating machines pursuant to § 12-308 remains consistent with the grandfathering provisions in the 2008 law. This limitation is in accordance with the legislature's intention to curb the expansion of commercial gambling operations in Maryland. In line with this interpretation, uncodified § 3 permits those who offer instant bingo on authorized machines pursuant to § 12-308 to repair and replace the machines so long as two conditions are satisfied: 1) "the machines operate in the same manner as those in operation. . . as of February 28, 2008", and 2) "the organization does not operate more than the number of electronic bingo machines in operation as of February 28, 2008." Contrary to CCI's contentions, uncodified § 3 does not establish nor recognize a new, separate class of electronic bingo machines or electronic bingo machine operators from which CCI was excluded.
Applying this interpretation to the facts at bar, CCI's electronic machines do not offer, and have never offered, "instant bingo," nor do CCI's machines satisfy the other requirements set forth in § 12-308. As a result, CCI's machines fall outside the scope of the class authorized under § 12-308. Because use of its machines is not authorized by § 12-308, CCI cannot, pursuant to uncodified § 3, repair and replace its machines, regardless of § 3's qualifying dates.
CCI places great weight on its contention that its machines fell within the scope of the 2008 law's bingo card minder exception.
Finally, CCI points out that the 2012 law's uncodified § 4 introduces the term "electronic instant bingo machine." Both parties equate the type of machine authorized under this provision with the type of machine authorized under § 12-308—i.e., both parties assume that an "electronic instant bingo machine" and an "electronic machine" offering instant bingo are the same. We need not, and, therefore, do not, express a view on the matter. CCI does not contend that its machines are "electronic instant bingo machines," nor does CCI challenge the constitutionality of uncodified § 4. For our purposes, it is sufficient for us to conclude, as we have, that uncodified § 3 of the 2012 law does not establish a distinct class of gambling machines from which CCI was improperly excluded.
Uncodified § 3, on its face, does not identify a particular individual or entity. CCI asserts that, in light of the legislative history of the 2012 law, the combination of the instant bingo grandfather provisions and uncodified § 3 equate to an identification of CCI because the legislature intentionally excluded it from the scope of § 3. In this context, CCI emphasizes that Senator DeGrange and Ms. Gruber used its machines as examples of a type of machine that the 2012 law would prohibit. In our view, this observation does not amount to a statutory identification of CCI for constitutional purposes. CCI's assertions are similar to those set forth by the appellants in Days Cove. In that case, we explained:
Indeed, "[i]t is well-settled that when the judiciary reviews a statute or other governmental enactment, either for validity or to determine the legal effect of the enactment in a particular situation, the judiciary is ordinarily not concerned with whatever may have motivated the legislative body or other governmental actor." Workers' Comp. Comm' v. Driver, 336 Md. 105, 118, 647 A.2d 96 (1994). Thus, legislative testimony is largely irrelevant with respect to a determination as to whether Chapter 161 is a special law. And, for this reason, we attach no significance to the fact that no other landfill facility was mentioned in legislative
200 Md.App. at 270-71, 27 A.3d 565.
Moreover, assuming for the purposes of analysis that the concerns of Senate President Miller and Senator DeGrange should be imputed to the General Assembly as a whole, we perceive no impropriety. In the words of the circuit court, CCI obtained its license "in the fleeting moment of opportunity" that existed after the legislature had clearly signaled its intention to restrict the growth of locally-licensed bingo operations in the 2008 law. As we have related, prior to the introduction of the 2012 legislation, Attorney General Gansler and senior members of his office had opined on no less than four separate occasions that CCI's machines, and the way that they were operated, violated then-current Maryland law. Further, even if CCI's machines were legal under the 2008 law, the prohibition against special laws does not restrict the General Assembly's authority to prohibit what was previously permitted. See Days Cove, 200 Md.App. at 276, 27 A.3d 565 (that legislation immediately affects only one entity "is not sufficient to render it a special law"); cf. Stone v. Mississippi, 101 U.S. 814, 818, 25 L.Ed. 1079 (1879) ("[N]o legislature can curtail the power of its successors to make such laws as they may deem proper in matters of [the] police power.") (Internal quotation marks and citation omitted.).
In this context, the Calvert County State's Attorney declined to prosecute CCI because, in her view, CCI's practices violated "the spirit" but not "the letter" of the 2008 law. The 2012 amendments to the card-minder exception, § 12-301(3)(iv), appear to have been an effort to address her concerns. It would be a singular exercise in futility for the legislature to amend a law to strengthen a prosecutor's hand while at the same time grandfathering the very practices that the amendment was intended to address.
As the circuit court noted in its opinion, the testimony established that both CCI and the Chesapeake Beach Post of the American Legion sought relief in the 2012 Session of the General Assembly, with the difference being that the American Legion was successful but CCI was not. The record suggests that the American Legion Post sought what became uncodified § 4 of the 2012 law because, prior to the enactment of the 2008 law, the Post had been operating ten machines under the belief that it did not need a license, and, as a result, could not satisfy the requirements of the instant bingo grandfathering provisions. The American Legion eventually obtained its bingo license at approximately the same time as CCI.
In our view, the purpose of the prohibition against special laws is "to prevent one who has sufficient influence to secure legislation from getting an undue advantage over others" Cities Service, 290 Md. at 568-69, 431 A.2d 663. We are not convinced that an American Legion Post in a small town can wield the sort of "influence" that § 33 is intended to protect against. Moreover, unlike the American Legion, CCI has never operated, nor sought to operate, electronic machines offering instant bingo. We are not persuaded
On the facts before us, this factor overlaps with CCI's claim that the 2012 law violates equal protection principles because, as to its latter claim, there is no dispute that the applicable test is one of rational basis. See Days Cove, 200 Md. App. at 278 n. 13, 27 A.3d 565. CCI argues that the enactment of uncodified § 3 fails the rational basis test because it prohibits only the Crooked I from operating its electronic bingo machines while permitting other bingo licensees to continue operating similar machines. Specifically, CCI argues that the legislature's use of the February 28, 2008 cutoff date in § 3 is arbitrary and unreasonable.
In evaluating this claim, we start with a strong presumption that the legislative enactment is constitutional. See, e.g., Maryland Aggregates Ass'n, 337 Md. at 673, 655 A.2d 886. The burden is on CCI, as "the one attacking the legislative arrangement," to demonstrate that the legislation lacks a rational basis by negating "every conceivable basis which might support it." Frey v. Comptroller of the Treasury, 422 Md. 111, 163, 29 A.3d 475 (2011) (internal brackets, quotation marks, and citation omitted); see also Murphy v. Edmonds, 325 Md. 342, 368, 601 A.3d 102 (1992) ("A statutory classification tested by the rational basis standard enjoys a strong presumption of constitutionality, and a reasonable doubt as to its constitutionality is sufficient to sustain it." (internal brackets, quotation marks, and citation omitted)).
In our view, CCI has failed to negate all possible rational bases for the General Assembly's use of February 28, 2008 as a qualifying date in § 3. As the trial court pointed out, February 28, 2008 has been the cut-off date for the instant bingo grandfather clause since the clause was first enacted in 2008. The General Assembly's use of the same date in § 3 is consistent with the cut-off date for the operation of electronic machines in the instant bingo grandfather provisions, and is further consistent with the legislature's previously articulated intent to prohibit commercial establishments from operating a larger number of electronic bingo machines than were operational prior to its consideration of the 2008 bill. These observations, alone, establish a rational basis for § 3's use of February 28, 2008. The legislative history to the 2008, 2009 and 2012 laws also indicates that at least some of the commercial bingo operations in existence prior to February 28, 2008 were generating significant tax revenues, an income stream which the legislature did not wish to halt abruptly,
It is well-established that the State's regulation of commercial gambling activities serves an important public interest.
Upon consideration of the Cities Service factors, we agree with the circuit court that § 3 is not a special law.
Next, CCI argues that the General Assembly's use of the February 28, 2008 cut-off date in uncodified § 3 violated the equal protection principles espoused in Article 24 of the Maryland Declaration of Rights. Article 24 states, in pertinent part: "That no man ought to be . . . deprived of his . . . property, but by the judgment of his peers, or by the Law of the land." Although not expressly stated, it is well-established that "the concept of equal protection is inherent in [Article 24's] text." Frey v. Comptroller of the Treasury, 422 Md. 111, 176, 29 A.3d 475 (2011). In Murphy v. Edmonds, 325 Md. 342, 601 A.2d 102 (1992), the Court of Appeals explained that:
325 Md. at 355-56, 601 A.2d 102 (internal quotation marks and citations omitted). As explained above, there is no dispute that the appropriate test on the facts before us is one of rational basis, nor do the parties dispute that the regulation of electronic bingo machines is a legitimate governmental purpose. We have already established that CCI has failed to prove that the legislature's use of the February 28, 2008 date in § 3 lacked a rational basis, or that it improperly discriminated against CCI. As such, the legislature did not run afoul of equal protection principles in its passage of the 2012 law.
CCI also argues that the 2012 law constitutes a taking without due process in violation of Article 24 of the Maryland Declaration of Rights
These contentions are unpersuasive.
First, we have already dispelled the assumptions upon which CCI's argument is premised. Second, as the State points out, nothing has been taken from CCI. The passage of the 2012 law did not revoke CCI's bingo license. It simply clarified the type of machine that CCI, as a commercial bingo licensee, could legally operate. Nothing in the law prevented CCI from complying with it.
Third, even before it began operations, CCI was on notice from the Attorney General's Office that its proposed machines were illegal. CCI does not challenge the trial court's conclusion that its machines did not offer "instant bingo" as that term was used in Chesapeake Amusements. Moreover, as we have discussed, CCI presented no evidence as to how its machines complied with the "mark and monitor" requirement for electronic bingo card minders. Thus, CCI's machines were not covered by the 2008 law's instant bingo grandfather clause and CCI has failed to demonstrate how its machines otherwise complied with the statute. At best, CCI was able to show that the State's Attorney for Calvert County had reservations about filing criminal charges against it but that falls short of proving that its machines complied with the law. In order to prevail on its takings claim, CCI, among other factors, must prove that its machines complied with the law prior to the 2012 amendments. See, e.g., Samuels v. Tschechtelin, 135 Md.App. 483, 523, 763 A.2d 209 (2000) ("To be successful in an action alleging denial of procedural due process in violation of a property interest, a plaintiff must demonstrate that he had
Lastly, CCI asserts that the circuit court abused its discretion in quashing subpoenas directed at Senate President Miller, Ms. Gruber, and the General Assembly. We disagree. In Harris v. State, 420 Md. 300, 330-31, 22 A.3d 886 (2011), the Court of Appeals explained that the enforcement of subpoenas "must necessarily be committed to the sound discretion of the trial court since the necessity for the subpoena most often turns upon a determination of factual issues. . . ."; see Maryland Rule 2-510(e) ("[T]he court may enter an order that justice requires to protect the person [subpoenaed] from annoyance, embarrassment, oppression, or undue burden
The State suggests that, in the event that we affirm the decision of the circuit court as to CCI's claims, its cross-appeal is rendered moot. An appeal is moot when it no longer presents "`a controversy between the parties for which, by way of resolution, the court can fashion an effective remedy.'" Potomac Abatement Inc. v. Sanchez, 424 Md. 701, 710, 37 A.3d 972 (2012) (quoting Adkins v. State, 324 Md. 641, 646, 598 A.2d 194 (1991)). We agree with the State that our decision as to CCI's appellate contentions moots the cross-appeal.
The record suggests that "Rapid Bingo" is a generic term used to refer to various types of bingo games which, by pre-drawing numbers, permit users to play bingo at a faster-than-normal rate. In Chesapeake Amusements, the Court drew the line between what was then a legal electronic instant bingo machine and an illegal slot machine based upon "the possibility that [the player] will receive a prize
In any event, the Attorney General is free to alter his or her position on such matters. See, e.g., Sheriff of Baltimore City v. Abshire, 44 Md.App. 256, 262 n. 6, 408 A.2d 398 (1979) ("We are not to be understood as being critical of the Attorney General's altering of his position. There is clear precedent for such action.").
Mr. Hill requested—in an approach similar to the proposals contained in House Bill 927—that the General Assembly expand the instant bingo grandfather clause to include the type of electronic bingo machines being operated by CCI, and to change the cut-off dates contained in previous versions of the clause so that CCI's machines would qualify. Mr. Hill's suggested amendments were not formally introduced.
The record suggests that the Chesapeake Beach American Legion Post sought what became uncodified § 4 of the 2012 law because, prior to the enactment of the 2008 law, the Post had been operating ten machines under the belief that it did not need a license, and, as a result, could not satisfy the requirements of the instant bingo grandfather provisions.