The Issue Whether or not on or about May 11, 1979, on his licensed premises, Albert Parrish, while being directly in charge of these premises, did unlawfully permit persons to play games of dice and cards for money, in violation of Section 849.01, Florida Statutes, and Section 561.29, Florida Statutes. Whether or not on or about June 1, 1979, in his licensed premises, the Petitioner, Albert Parrish, did unlawfully maintain a house, booth, tent, shelter or other place, to wit: The Red Honey, 835 East Brownlee Street, Starke, Bradford County, Florida, for the purpose of gaming or gambling, in violation of Section 849.01, Florida Statutes, and Section 561.29, Florida Statutes.
Findings Of Fact This cause comes on for consideration based upon a Notice to Show Cause (Administrative Complaint) filed by the State of Florida, Division of Alcoholic Beverages and Tobacco, against Albert Parrish who trades as the Red Honey in a licensed premises located at 835 East Brownlee Street, Starke, Bradford County, Florida. The Respondent, Albert Parrish, is the holder of license No. 14-69, Series 2-COP, which allows the Respondent to sell beer and wine at the aforementioned premises. The State of Florida, Division of Alcoholic Beverages and Tobacco, is an agency of the State of Florida charged with the duty to regulate those persons and other entities who hold beverage licenses within this state and it is in keeping with that charge that the Notice to Show Cause (Administrative Complaint) has been brought against the Petitioner, Albert Parrish, for the offenses as set out in the Issues statement of this Recommended Order. The Respondent has contested those allegations and the case has been considered in accordance with Subsection 120.57(1), Florida Statutes. On May 11, 1979, Beverage Officer Phyllis Williams, in the company of Columbia County, Florida, Sheriff's Officer Oliver Lake went to the licensed premises in Starke, Florida. After entering the licensed premises, they stayed for a period of one to one and one-half hours, during which time the Respondent, Albert Parrish, was present. In this sequence of time Albert Parrish was located at a pool table found in the licensed premises and a number of other persons were at the pool table rolling dice, which is a game of chance. Money was being placed on the table by the players and Parrish was picking up money from the table and placing it in a box which was in his custody and control. Parrish was in charge of the dice game to the extent of being an active participant and receiving financial benefit and to the extent of allowing other persons to play the dice game. While Officers Williams and Lake were in the licensed premises on May 11, 1979, they also observed a card game being played and this went on for some forty-five minutes. The game being played was a game known as "Tunk" which on this occasion was being played with wagered money pieced on the table. The Respondent, Parrish, was not directly participating in the card game, in that he was running the dice game at a separate location within the licensed premises; however, the person who appeared to be in charge of the "Tunk" card game was seen to pass an item to Parrish during the course of the time in which the officers were in the licensed premises. Therefore, although Parrish did not actively participate in the card game, he did unlawfully permit other persons to participate in the card game in his licensed premises. On June 1, 1979, Beverage Officer James Bates went back to the licensed premises in Starke, Florida. On this occasion, Bates observed a number of persons around a pool table and Parrish standing next to the pool table and a dice game being played. Two dice were being thrown and money was being wagered. Parrish was in charge of the dice game to the extent that wagers of money would be placed and Parrish would put a playing card on top of the money and then when a winner had prevailed, Parrish would pay off that winner. Bates observed the fact of this activity for approximately two hours and Parrish remained at the pool table for the entire period of time. Bates also observed an individual who was acting as a lookout and when police cars would pass by, the lockout would give a warning and all of those persons in the licensed premises would step away from the pool table until the police car had left the area of the licensed premises, at which time the game would be resumed.
Recommendation It is recommended that the Respondent, Albert Parrish, have his beverage license No. 14-69, Series 2-COP, suspended for a period of ninety (90) days. DONE AND ENTERED this 18th day of December, 1979, in Tallahassee, Florida. CHARLES C. ADAMS, Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: Daniel C. Brown, Esquire Staff Attorney Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Albert Parrish t/a Red Honey 835 East Brownlee Street Starke, Florida ================================================================= AGENCY FINAL ORDER =================================================================
The Issue The issue in this case is whether Respondent should approve the renewal of a licensee's annual slot machine gaming license, where, according to Petitioner, the licensee's slot machine gaming area is not "contiguous and connected to" its pari-mutuel facility's "live gaming facility" for wagering on horse races—— if a live gaming facility even exists at the track——and therefore fails to conform to statutory requirements.
Findings Of Fact Parties Petitioner Florida Horsemen's Benevolent and Protective Association, Inc. ("FHBPA"), is a Florida nonprofit corporation whose members include hundreds of Florida licensed horse trainers and thousands of Florida licensed horse owners. FHBPA exists to promote horse racing in the state of Florida and to represent the interests of its members in dealing with the public, the legislature, state regulators, and the tracks. Respondent Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering ("DPMW"), is the state agency responsible for implementing and enforcing Florida's pari-mutuel laws. Its duties include the licensing and regulation of all pari-mutuel activities in Florida. Respondent Calder Race Course, Inc. ("Calder"), is the holder of a pari-mutuel wagering permit. As a permitholder, Calder must apply for an annual license to conduct pari-mutuel operations. See § 550.0115, Fla. Stat. This annual license gives the permitholder authority to conduct the pari-mutuel wagering activity authorized under its permit on the dates identified in the license.1/ At all times relevant to this case, Calder has held a license to conduct thoroughbred horseracing performances. In addition to its license to conduct pari-mutuel operations, Calder has held, at all times relevant hereto, a license to conduct slot machine gaming. Events Leading to the Instant Dispute In July 2009, Calder applied for and received a slot machine license, in accordance with the provisions of section 23, article X of the Florida Constitution, and sections 551.101 and 551.102(4). As a condition of initial licensure, Calder needed to demonstrate its compliance with chapters 551 and, as applicable, chapter 550, Florida Statutes. § 551.104(4), Fla. Stat. A slot machine license must be renewed annually. "[T]o maintain continued authority for the conduct of slot machine gaming," a slot machine licensee must, as a condition of renewal, and at all times, "[c]ontinue to be in compliance with" chapter 551; "[c]ontinue to be in compliance with chapter 550, where applicable[;] and maintain [its] pari-mutuel permit and license in good standing pursuant to the provisions of chapter 550." Id. A slot machine licensee must have a designated slot machine gaming area ("SMGA") where "slot machine gaming may be conducted in accordance with the provisions of" chapter 551. §§ 551.102(2), 551.114, Fla. Stat. Section 551.114(4), which is at the center of the current controversy, specifies where the licensee is allowed to locate its SMGA: Designated slot machine gaming areas may be located within the current live gaming facility or in an existing building that must be contiguous and connected to the live gaming facility. If a designated slot machine gaming area is to be located in a building that is to be constructed, that new building must be contiguous and connected to the live gaming facility. From the outset, Calder intended not to place its SMGA within the current live gaming facility ("LGF") at its track, but in a new casino, to be constructed for the purpose of serving as its slot machine building ("SMB"). Opened in 2010, Calder's casino was nearby its racetrack and grandstand facility. The grandstand, with a large seating area for spectators, was part of a 450,000 square foot building. When the casino first opened its doors, this grandstand building was Calder's LGF. Calder's SMB (the casino), when built, was not "contiguous" to the current LGF (the grandstand) under any ordinary understanding of the word "contiguous," which clearly denotes actual contact——touching. Nor was the SMB directly "connected to" the LGF in accord with the image that most readily comes to mind when thinking about how two contiguous structures would be connected to each other, for in that image some physical element of one structure is linked or joined to some physical element of the other, which latter shares a common boundary with the former, being contiguous thereto. This departure from the plain meaning section 551.114(4) resulted from DPMW's decision to give licensees "leeway" in satisfying the strict statutory requirement that an SMB, if used as the location for the SMGA, be "contiguous and connected to" the current LGF (the "CCT Requirement"). DPMW first relaxed the CCT Requirement for Pompano Park, a standardbred harness racetrack in Pompano Beach, Florida. A few years before Calder obtained its slot machine license, Pompano Park had acquired one. Pompano Park had wanted to place its SMGA in a new SMB, just as Calder later would do, and sought DPMW's guidance regarding compliance with the CCT Requirement. DPMW informed Pompano Park that the agency would be satisfied if the two buildings were "connected" by a covered walkway (rather than to each other). So, Pompano Park "connected" its newly constructed SMB to its then current LGF (a grandstand) by a sidewalk, and DPMW approved the configuration by issuing, and renewing, Pompano Park's slot machine license. In 2009, Calder wanted the same deal for its SMB. DPMW had no real choice but to go along. Having previously construed the CCT Requirement as demanding no more than a connecting sidewalk between the SMB and the LGF, DPMW had formulated an interpretive statement regarding section 551.114(4) for Pompano Park so broadly worded as to apply generally to all slot machine licensees. It therefore could have surprised no one when DPMW told Calder that its proposed SMB would be sufficiently "contiguous and connected to" the existing grandstand if there were a covered walkway between the structures. Calder made it so. At the time Calder built its casino, FHBPA did not object to DPMW's slots-friendly construction of section 551.114(4), which gave the green light to stand-alone SMBs——and, for that reason, should have flashed a yellow warning signal to the horsemen. Calder's original set-up, however, promised to benefit FHBPA because section 551.104(10)(a) provides that "[n]o slot machine license or renewal thereof shall be issued to an applicant holding a permit under chapter 550 to conduct pari- mutuel wagering meets of thoroughbred racing unless the applicant has on file with [DPMW] a binding written agreement between the applicant and the Florida Horsemen's Benevolent and Protective Association, Inc., governing the payment of purses on live thoroughbred races conducted at the licensee's pari-mutuel facility." Calder, in short, was required to enter into a revenue sharing agreement with FHBPA under which slot machine revenues would be used to supplement the purses paid on the races conducted at Calder's track. As of the final hearing, pursuant to the FHBPA/Calder Supplement Agreement ("Statutory Contract"),2/ FHBPA was collecting (for the benefit of its members) between $8 million and $9 million per year from Calder's slot machine gaming operations. The interesting thing about section 551.104(10) is that not only does it require Calder, as a slot machine licensee, to have a binding written agreement with FHBPA, as the statutorily designated (by name) thoroughbred horsemen's bargaining agent; but also, FHBPA is forced thereunder to enter into the agreement with Calder. In this regard, section 551.104(10)(c) provides that if the parties are unable timely to reach an agreement, they must submit to "mandatory binding arbitration to resolve the[ir] disagreement," at the conclusion of which "the arbitration panel shall present to the parties a proposed agreement that the majority of the panel believes equitably balances the rights, interests, obligations, and reasonable expectations of the parties." § 551.104(10)(c)3., Fla. Stat. The parties "shall [then] immediately enter into such agreement, which shall satisfy the requirements of [section 551.104(10)](a) and permit issuance of the pending annual slot machine license or renewal." Id. The statute literally gives FHBPA no choice but to do business with Calder as long as Calder is a slot machine licensee. If FHBPA had any misgivings about DPMW's interpretation of the CCT Requirement in and around 2010 and during the several years thereafter, the slot machine revenue stream flowing to FHBPA pursuant to the Statutory Contract must have ameliorated them. By allowing Pompano Park and Calder to build freestanding, noncontiguous SMBs, however, DPMW (perhaps unwittingly) had opened a door that Calder strode through in 2015, when it began tearing down the grandstand complex, a demolition project which was completed in 2016.3/ Calder could do this without in any way affecting the casino/SMB because the SMB was not actually contiguous and connected to the LGF. Had the SMB truly been contiguous and connected to the LGF, Calder could not have demolished the LGF without directly impacting, if not partially tearing down, the SMB. In that event, new construction would have been needed to restore the SMB's integrity and to replace the LGF to which the SMB must be contiguous and connected.4/ As it happened, Calder razed the grandstand, cleared the debris, and built——nothing. The question naturally arises, therefore, whether Calder currently has a "live gaming facility." FHBPA asserts that Calder lacks a legally sufficient LGF because there is no longer an occupiable structure near the track from within which patrons may watch and place wagers on live horse races. DPMW and Calder disagree with FHBPA. They contend that Calder has a "live viewing area" or "live viewing locations," which include some physical amenities that, taken as a whole, constitute an LGF within the ambit of section 551.114(4). There are no genuine disputes regarding the material facts surrounding Calder's so-called "live viewing locations." The primary viewing area is located in front of the final stretch of the racetrack, at a spot called the "apron." There are some outdoor seats and tiki huts on the apron, and, during the race meet, Calder erects a collapsible canopy tent there, which, despite the absence of walls, provides a bit of shelter for wagering machines, video screens, and, of course, patrons, for whom additional outdoor seating is provided. At the "viewing locations" on and around the apron, patrons can watch and place bets on horse races. Conveniently, walk-around tellers are usually nearby to take wagers from patrons who venture out from the shaded area under the canopy. A food truck is frequently present, too, so patrons might have a trackside dining option. All of this is only a short distance from the casino, and there is a concrete walkway along the route, so patrons do not need to step on grass or parking lot pavement if they stroll from the SMB to the apron or vice versa. And, although there is no longer a ceiling or other covering protecting the entire length of the sidewalk from the elements, patrons at least do not need to cross a public street, waterway, or similar barrier to get from the SMB to the "live viewing area" on the apron, nor must they leave the confines of Calder's property. In July 2017, DPMW granted Calder's application for the renewal of its slot machine license, for the fiscal year 2017-18. DPMW took this action knowing that Calder had demolished its grandstand and being fully aware of the facts relating to Calder's trackside "live viewing area." Behind DPMW's issuance of the renewal license lay its interpretation of section 551.114(4)'s "live gaming facility" nomenclature as including an outdoor "viewing area" such as the apron at Calder's track; and the agency's interpretation of the statute's CCT Requirement, under which the strict original text, "must be contiguous and connected to," becomes the lax, "must be no farther than a short walk from, and connected by a paved pathway that crosses no streets, rivers, or similar barriers, to." On October 25, 2017, FHBPA filed a Petition Challenging an Agency Statement as a Rule, alleging that DPMW's interpretations of "live gaming facility" and "contiguous and connected to," as manifested by the renewal of Calder's slot machine license, constituted unadopted rules. See Fla. Horsemen's Benevolent & Protective Ass'n v. Dep't of Bus. & Prof'l Reg., Case No. 17-5872RU, 2018 Fla. Div. Adm. Hear. LEXIS 654 (Fla. DOAH Sept. 4, 2018)(the Rule Challenge). FHBPA lost its section 120.56(4), Florida Statutes, challenge to these agency statements at the trial level and did not appeal the ALJ's decision. DPMW and Calder view their last victory as significant, but the Rule Challenge has no bearing on this case. Whether or not DPMW's interpretations of section 551.114(4) are rules by definition, they are not controlling here. If they are unadopted rules, then the undersigned, of course, cannot apply them as authoritative principles in determining any party's substantial interests. See § 120.57(1)(e), Fla. Stat.5/ And if they are not unadopted rules, as was found in the Rule Challenge, then by definition the interpretive statements do not have the force and effect of law. Simply put, DPMW cannot have nonliability under section 120.56(4) and authoritative statements, too. At bottom, therefore, DPMW's interpretative statements constitute legal arguments to be evaluated on the same footing as any other party's arguments. In this regard, it is perhaps worth noting that section 120.56(4) neither requires nor authorizes the ALJ to determine whether the alleged unadopted rule is a correct reading of the underlying statute. Accordingly, the ALJ in the Rule Challenge rightly declined to reach that issue. Id. at *37. In this case, by contrast, ascertaining the originally intended meaning of section 551.114(4), so that the legislature's policy respecting SMBs may be carried out, is the whole ballgame.6/ In May 2018, Calder filed an application to renew its slot machine license for 2018-19. On July 9, 2018, DPMW granted Calder's application and issued the renewal license, taking putative final agency action. Not long thereafter, FHBPA filed a petition requesting a hearing to contest DPMW's issuance of a renewal license to Calder for fiscal year 2018-19. Regarding the timeliness of FHBPA's petition, it is undisputed that DPMW did not give FHBPA a clear point of entry into an administrative proceeding to determine the correct agency action to take on Calder's license renewal application. Consequently, as will be discussed below, the issuance of Calder's renewal license, despite outward appearances, is not final agency action, as a matter of law, if the decision to approve Calder's application determines FHBPA's substantial interests. In other words, because an opportunity for a hearing was not clearly offered to, and thereafter waived via inaction by, FHBPA, its petition was not untimely, provided FHBPA has standing to proceed (which is disputed). The Real Agency Action of Interest Because Calder must remain continually in compliance with chapter 551 to maintain its license to conduct slot machine gaming, DPMW could not and cannot lawfully renew Calder's license without first determining that Calder remains in compliance with all provisions of the slot machine gaming law. Thus, by necessary implication, DPMW's approval of Calder's application for renewal of licensure reflects and manifests the agency's conclusion that Calder continues to conform to, inter alia, the CCT Requirement. There is no dispute about this. There is also no dispute that Calder's original LGF, the grandstand, had been demolished by the time of the instant renewal application, and that in its place, at the trackside apron, near the spot where the grandstand had once stood, Calder had established a "live viewing area" as described above, whose only "connection to" the SMB was (and remains) a paved walkway. The real agency action of interest to FHBPA is not the renewal of Calder's license per se——although that's important, to be sure, because the license preserves a real-life status quo of facts on the ground that FHBPA considers harmful to its interests; rather, the real determination at issue is DPMW's loose reading of section 551.114(4), without which the approval of Calder's application could not have happened. FHBPA contends that DPMW has not only misapplied section 551.114(4) (in renewing Calder's license) but also misinterpreted the statute (in forming a generally applicable understanding of the CCT Requirement that waters down the plain statutory language). The issuance of the license was an overt, formal agency action. The statutory interpretation was covert and informal but no less an agency action. When DPMW told Calder in 2009 (and Pompano Park some time earlier) that the CCT Requirement could be satisfied by installing a covered walkway between the SMB and the LGF, it effectively rendered a declaratory statement, albeit without following the procedure set forth in section 120.565. Later, when DPMW indicated to Calder that its current LGF did not need to be a building, because an outdoor, trackside "viewing area" with a canopy tent located near the place where the former LGF had once stood would be good enough for section 551.114(4), the agency again provided Calder with the functional equivalent of a declaratory statement, absent the formalities. FHBPA was never given a clear point of entry to be heard in these matters. Attention is being drawn to the agency's articulation, sub silentio, of these declaratory statements-in-fact because DPMW and Calder would like to characterize the action at issue here as being strictly a two-party transaction involving "just" the agency's renewal of Calder's slot machine license. But, that is not true. The renewal of Calder's license necessarily means, to repeat for emphasis, that DPMW has determined that Calder's SMB is "contiguous and connected to" its "LGF" (or "live viewing area," as they understandably prefer to call it), because Calder is required to be in compliance with section 551.114(4) to maintain its continued authority to conduct slot machine gaming operations. These are very real, very consequential interpretive statements. If FHBPA's substantial interests may be affected by these agency decisions regarding the meaning of section 551.114(4), as FHBPA asserts, then its right to a hearing under sections 120.57 and 120.569 concerning DPMW's statutory interpretations has not been waived, because DPMW failed to publish advance notice thereof in accordance with section 120.565(3).7/ In sum, while this case appears on the surface to be a challenge to the agency action that was taken in plain view, i.e., the renewal of Calder's slot machine license, what is really happening is a determination of the correct understanding of section 551.114(4), which is a consequence of DPMW's having provided Calder, behind the scenes, with putatively authoritative interpretations of key statutory terms. Assuming DPMW's interpretive statements affect or determine FHBPA's substantial interests, FHBPA's right to a hearing thereon is not legally tied to Calder's license renewal and, indeed, could have been exercised independent thereof. Once the statutory meaning is finally sorted out, the question——which is secondary to a correct understanding of section 551.114(4)——of whether Calder may continue lawfully to conduct slot machine gaming operations without making changes to its existing pari-mutuel facilities will be easily answered because the material facts about the licensee's current facilities are not genuinely disputed.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering, enter a final order denying Calder's application for renewal of its slot machine license for the fiscal year 2018-19. DONE AND ENTERED this 24th day of May, 2019, in Tallahassee, Leon County, Florida. S JOHN G. VAN LANINGHAM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 24th day of May, 2019.
The Issue Whether Florida Administrative Code Rules 61D-11.001(8) and (13), 61D-11.002(1), 61D-11.005(2) and (9), and 61D- 11.027(1)(b), (1)(e), (2)(a) and (2)(b), are invalid exercises of delegated legislative authority pursuant to Subsection 120.52(8), Florida Statutes (2004).
Findings Of Fact Stipulated Facts Petitioner, Calder Race Course, Inc., a Florida Corporation, is a pari-mutuel permitholder permitted and licensed by the Division of Pari-Mutuel Wagering (Division) pursuant to Chapter 550 and Section 849.086, Florida Statutes. Petitioner, Dania Jai Alai, a division of The Aragon Group, a Florida Corporation, is a pari-mutuel permitholder permitted and licensed by the Division pursuant to Chapter 550, and Section 849.086, Florida Statutes. As cardroom operators, Florida Administrative Code Chapter 61D-11 governs the activities of Petitioners in the operation of their respective cardrooms, pursuant to their cardroom licenses at their pari-mutuel facilities. The challenged rules have the effect of directly regulating the operation of Petitioners' cardrooms. Petitioners are substantially affected by the challenged rules and have standing to bring this rule challenge. A tournament is a series of games. Multi-table tournaments eliminate players until there are only enough remaining players to play at one table before the tournament concludes. Tournaments which consist of nine players at a single table, often referred to as mini-tournaments, are commonly used by Florida Native-American cardrooms as a form of poker tournament play. Pari-mutuel pools, operated by pari-mutuel permitholders and the rules regulating pari-mutuel wagering, currently allow jackpots. Facts based upon the evidence of record History of the Rules The Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering, is the state agency responsible for administering Section 849.086, Florida Statutes, and regulating the operation of cardrooms in the state. In 1996, the Florida Legislature created Section 849.086, Florida Statutes, authorizing cardrooms to be located at licensed pari-mutuel facilities. § 20, Chap. 96-364, Laws of Florida. In response to this legislation, Florida Administrative Code Chapter 61D-11 was adopted, governing the operation of cardrooms at pari-mutuel facilities. Section 849.086, Florida Statutes, was amended in 2003 by Section 4, Chapter 2003-295, Laws of Florida. Of particular significance to this case, the 2003 amendments eliminated a $10.00 limit on winnings and imposed a $2.00 bet limitation, with a maximum of three raises per round of betting. In response to this legislation, the Division began the process of amending Florida Administrative Code Chapter 61D-11. During this rule amendment process, the Joint Administrative Procedures Committee (JAPC) sent two letters to the Division expressing concerns with respect to provisions of the proposed rules regarding the Division's approval of authorized games and lack of criteria for such approval, a requirement for submission of a form, the Division's authority to approve a series of games (tournaments), and the Division's authority to prohibit jackpots. As part of the rule adoption process, the Division responded to these letters and informed JAPC that the Division was filing a Notice of Change regarding certain adjustments to the proposed rules. As part of the rule adoption process, the Division also conducted a rule development workshop on September 16, 2003, and a public hearing on January 7, 2004. The amendments were adopted May 9, 2004. Some of these rules amendments are the subject matter of the instant proceeding. Concerns of the Division Royal Logan is the chief operations officer for the Division. He has held that position for a total of approximately ten years. He was a member of a committee established in the Division as part of the process of amending Florida Administrative Code Chapter 61D-11 as a result of the 2003 amendments. According to Mr. Logan, the committee was concerned with several issues including compliance with the legislative intent of strict regulation of gambling, the Division's manpower in regulating cardrooms, and tax reporting concerns relating to auditing. More specifically, the Division was concerned that jackpots and re-buys have the potential of violating the $2.00 bet and raise limitations, the potential opportunity for collusion in single-game tournaments, and pose difficulties for accurate tax reporting. The Division does not have a group of employees specifically devoted to cardrooms. The Division has employees designated as chief inspectors at racetracks. The chief inspector has many duties including monitoring cardrooms to ensure compliance with statutes and rules. Monitoring cardroom compliance comprises no more than 10 to 12 percent of their time, as that person is the primary licensing official at the site. Not all racetracks have chief inspectors. The Game of Poker Poker is a card game using a single deck of 52 cards. Poker consists of a ranking system. The person holding the highest-ranking hand at the end of the game wins the pot. The traditional ranking system consists of the highest-ranking hand to the lowest. Hoyle’s Modern Encyclopedia of Card Games, by Walter B. Gibson, April 1974 Edition, contains an accurate description of the traditional ranking system in poker. Stanley Sludikoff is an expert in the game of poker, the rules of the game, and how poker is played in the United States. Mr. Sludikoff considers Hoyle's not to be the most authoritative book on the game of poker and that it applies primarily to home games as opposed to games played in gamerooms. Hoyle's does not address the subjects of tournaments or jackpots. Because Hoyle's contains an accurate description of the traditional ranking system in poker, the undersigned is not persuaded that the reference to Hoyle's in Florida Administrative Code Rule 61D-11.002(1) is inappropriate or arbitrary. In Mr. Sludikoff's opinion, tournaments are appealing because there is a low fixed risk with the potential for higher gain. They allow participants to build up to a higher limit game and potentially win entry into larger tournaments, such as the World Series of Poker. Single table tournaments are common in the United States in both large and small properties. Multi-table tournaments eliminate players until there are only enough remaining players to play at one table before the tournament concludes. Regular (non- tournament) games are played at single tables. According to Mr. Logan, the Division determined that the entry fee for a tournament should be calculated based upon the $2.00, three-raise limitation. The Division determined that "re-buys" are not consistent with the wagering limitations of Section 849.086, Florida Statutes. In Mr. Sludikoff's opinion, when the rules of the tournament allow, a re-buy is available to all players during a specified period of time. The rules are set by the cardroom operators, and each player in a tournament is aware of the ability to re-buy, how much the re-buys cost, and when it may be exercised. Re-buys are not the same thing as re-entering a tournament because participants are not permitted to re-buy unless he or she is a participant in the tournament at the time such re-buy is made available. A participant is not out of a tournament unless he or she is out of chips and there is no re-buy available to such participant. Allowing players to re-buy additional chips is a common practice in poker tournaments. Re-buys are easily recorded as a type of revenue received, thereby not presenting an accounting or auditing problem. Mr. Sludikoff's opinion in this regard persuades the undersigned that the agency's rationale regarding the entry fee and re-buy limitations are not supported by the necessary facts and are arbitrary. Most cardrooms in the United States have jackpots. Florida's statutory limitation of a $2.00 bet and raise limitation is a restrictive form of wagering. Under this limitation, the most that a participant can bet is $8.00 in any round. "Pari-mutuel" is a French term meaning wagering among ourselves, in that the participants are not wagering against the "house." Section 849.086, Florida Statutes, characterizes games authorized pursuant to that section to be "pari-mutuel style" games. Playing a game in a non-banking manner means that the "house", the cardroom operator, does not participate in the game at all and that the game participants are not playing against the house.
The Issue The issue presented is whether Respondent is guilty of the allegations in the Administrative Complaint filed against him, and, if so, what disciplinary action should be taken against him, if any.
Findings Of Fact At all times material hereto, Respondent Clivalee Mundle was the holder of a slot machine occupational license issued by the State of Florida and numbered 7937616-1051. That license expired June 30, 2008, and has not been re-issued. At all times material hereto, Respondent was employed as a slot supervisor at The Isle Casino and Racing at Pompano Park, a licensed Florida pari-mutuel and slot machine facility located in Pompano Beach, Florida. On November 16, 2007, a senior attendant reported to the slot chip manager an incident involving Respondent. She reported that she had gone to the cage service window to use the computer. The cage is where the money is held in a casino. She reported that while she was there, Respondent came in and began assisting her. When he reached into his coat, a $100 bill fell out and onto the floor. She placed her foot next to the bill and asked Respondent if it were his. Respondent picked it up and acted, in her opinion, nervous. Employees at the casino are instructed to keep their own money in their wallets and to not have loose cash on them when they are on the casino floor. They are also instructed to keep any casino money in sight so that the money surveillance cameras can track it. Based upon the report he received, the slot chip manager contacted surveillance personnel and requested them to view the surveillance videos that recorded the incident. Upon doing so, those employees reported to him that Respondent had earlier obtained a $100 bill from the cage to pay out a jackpot on slot machine A-50-02 but that he subsequently never went to that machine to do so. Further, the videos showed that the jackpot on that machine had already been paid before Respondent obtained the $100 bill he obtained from the cage. Based upon that surveillance report, the slot chip manager viewed surveillance videos from prior dates. The review of the surveillance videos revealed the following transactions. On November 8, 2007, Respondent was at the cage service window filling out a paid-out cash slip to obtain a $100 bill when the slot chip manager came in. Rather than completing what he was doing, Respondent folded the form and put it in his pocket. Later that day, he turned in the paid-out slip and received a $100 bill. The form he filled out stated that he needed the money to settle a guest dispute. However, he never gave the money to anyone between the time he obtained it and the time he left the casino at the end of his shift. The surveillance videos for November 9, 2007, show Respondent filling out a paid-out slip at the cage, receiving a $100 bill, and concealing that bill inside a piece of paper in his coat pocket. The slip he filled out represented that he was obtaining the money for a guest dispute at machine A-15-05. Later that same day, he filled out another cage slip for a jackpot pay-out at machine A-50-08. When he received the $100 bill requested, he put it under a piece of paper on a clipboard. Surveillance videos showed that the jackpot on that machine had been paid out before Respondent obtained the $100. Surveillance videos did not show Respondent giving either of those $100 bills he obtained on November 9 to anyone in the casino. The videos show that on November 13, 2007, Respondent paid a jackpot to a customer who then gave Respondent her player's card. Respondent took her player's card to the player's card window, had a discussion with the attendant, and then returned to the player and returned her card. He then went to the cage service area, filled out a cage paid-out slip for $100 for guest satisfaction, placed the $100 underneath papers on a clipboard, and left the cage area. Between that time and the end of his shift, Respondent did not give that money to anyone. None of the monies Respondent obtained from the casino cage as described in the above Findings of Fact was used for a legitimate business purpose. Respondent failed to complete the transactions for which he allegedly received the monies. Rather, Respondent retained these monies for his own use. Respondent admits to dropping the $100 bill on November 16, 2007. His explanation is that he had previously left the casino and had picked up some relatives and taken them to his home. He stated that the $100 bill was given to him by one of those relatives so he could pick up formula and diapers on his way home. The surveillance videos do not show Respondent leaving the casino or returning prior to the incident. On November 29, 2007, Respondent was terminated from his employment by the casino. On February 7, 2008, The Isle Casino and Racing at Pompano Park issued to Respondent a Notice of Barrment [sic], which barred Respondent from the premises of the casino permanently.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered (1) finding Respondent guilty of the allegations in the Administrative Complaint filed against him, (2) excluding Respondent from all facilities of all slot machine licensees in the State of Florida, and (3) finding Respondent ineligible for a slot machine occupational license. DONE AND ENTERED this 11th day of February, 2009, in Tallahassee, Leon County, Florida. S LINDA M. RIGOT Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 11th day of February, 2009. COPIES FURNISHED: Clivalee Mundle 4689 Northwest 22nd Street Coconut Creek, Florida 33063 David Perry, Esquire Department of Business and Professional Regulation 1940 North Monroe Street, Suite 40 Tallahassee, Florida 32399-2202 Ned Luczynski, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street, Suite 40 Tallahassee, Florida 32399-2202 David J. Roberts, Director Division of Pari-Mutuel Wagering Department of Business and Professional Regulation 1940 North Monroe Street, Suite 40 Tallahassee, Florida 32399-2202
Findings Of Fact Petitioner designs, manufactures, and sells the "Little Casino" video game machine. The machine is designed to enable a player, through the insertion of either one or two quarters, to play one of four games: poker, high-low, blackjack, or craps. The machine contains two switches which enable the owner to control the cost per game, whether 25 cents or 50 cents per game. Upon deposit of the appropriate amount of money, the player of the game receives 10,000 points to play the selected game. If the operator utilizes the entire 10,000 points in less than four hands or rolls, the game is over. If, however, the operator earns or wins 100,000 points by the conclusion of the fourth hand or roll, a free fifth hand or roll is allowed. If the operator earns 200,000 points by the conclusion of the fifth hand or roll, a free sixth hand or roll is allowed. The player of the game is allowed no more than six hands or rolls in the chosen game, regardless of the number of points scored. Depending upon the game option selected, cards or dice appear on the video screen. So far as can be determined from the record in this cause, the dealing of the cards or roll of the dice is entirely determined by the programming of the machine, and the player is wholly unable to control or influence the initial selection of cards or the roll of the dice. Little Casino does not allow free replays, does not accumulate free replays, and makes no permanent record of free replays. The game is not classified by the United States as requiring a federal gambling tax stamp under any applicable provisions of the Internal Revenue Code. The machine can be set to eliminate what Respondent considers to be the objectionable fifth and sixth hands.
Findings Of Fact At all times pertinent to the issues considered at this hearing, Respondent, Dale's Package Store and Lounge, Inc., was issued 6-COP alcoholic beverage license No. 20-0012, which permits the on-premises consumption or sealed package sales of beer, wine, and liquor and the carry out sales of open malt or vinegar spirits, but not mixed drinks. On May 13, 1983, Investigator Robert W. Cunningham visited the licensed premises based on an anonymous phone call he had received at home to the effect that a lottery was being conducted there. When he entered the lounge, he saw a poster sitting on the first table inside the door. This poster contained a list of items of merchandise or services to be given as prizes and a notation of the prices for tickets. While he was looking at this display, he was approached by a patron, Edward Hanson, who asked if Cunningham wanted a ticket. When Cunningham said he did, Hanson went to the bar, where he spoke with Cindy, the bartender, and came back with a large roll of tickets, telling Cunningham to take as many as he wished. Cunningham took three and paid the $2 which the poster indicated was the price for the tickets. Half of each ticket was put in the box for the drawing. After the ticket transaction, Cunningham went up to Cindy and asked her who was in charge. When told it was Mickey (Naomi Hunt), he went into the back room, where he found her and told her it was an illegal lottery that had to stop. He also talked at that time with Susan Roberts, a representative of the local Multiple Sclerosis Foundation chapter for whom the lottery was being conducted. Ms. Roberts advised Cunningham she had discussed the matter with one of the local assistant state attorneys, who said it was all right, but she could not recall his name. Cunningham had advised Naomi Hunt to call Mr. Eggers initially, and Eggers said he would come down. Cunningham also called his district supervisor, Capt. Caplano, because, due to the size of the crowd in the bar at the time, between 200 and 250 people, he felt he needed a backup. Caplano agreed to come down to the lounge, as well. Caplano also advised Cunningham that the procedure was an unlawful lottery and the tickets and money should be seized. When Eggers got there, he told Cunningham that the entire activity was for the benefit of the Multiple Sclerosis Foundation and that his employees had been out soliciting the donation of the prizes for months. Respondent admits the conduct of the operation as the Roadhouse Inn's participation in the fund-raising campaign of the North Florida Chapter of the Multiple Sclerosis Foundation. Respondent has been approached by that agency with a kit of fund-raising activities and ideas. Before participating in the lottery, Mr. Eggers asked and was advised by both Ms. Hunt, his employee, and Ms. Roberts of the Foundation that they had inquired into and were advised of the project's legality. If the law was violated, it was done without criminal intent and without malice. A well-intentioned effort to do some good was in error. It should be noted, however, that in January 1977, this licensee was cited by Petitioner's Agent R. A. Boyd for operating a bowling machine on the premises. If the customer bowled a high score on the machine, he or she would win something, such as a drink or a snack. This was considered gambling by Petitioner, however; and upon issuance of the citation, Respondent immediately stopped the activity. No charge was laid against the licensee for that activity. Several days after Cunningham closed down the lottery, on May 19, 1983, Beverage Officer Reeves went to the licensed establishment based on a complaint received that alcoholic beverages were being served by the drink at the curb. He went to the drive-in window of the Inn and ordered a scotch and water from Naomi. She brought him a drink in a plastic cup. From his experience, he recognized the substance as scotch and water. After getting the drink, he parked the car and went inside, where he talked with Naomi and Eggers. They indicated they did not know it was illegal to sell a drink this way. Eggers indicated at the hearing that he thought that since he could sell open beer drinks out the drive-in window, he could do the same with mixed drinks. He does not have any copy of the beverage laws, thought he was operating legally, and has been doing it without objection since 1977. Since Reeves' visit, the sale of distilled spirits by the drink through the window has ceased.
The Issue The issues in this case are whether Respondent unlawfully conducted gambling operations at its licensed business establishment, and, if so, what penalty is warranted.
Findings Of Fact The Department is the state agency responsible for, inter alia, licensing and monitoring businesses licensed under the Florida Beverage and Tobacco laws. Department headquarters are in Tallahassee, Florida. Respondent is a duly-licensed business monitored by the Department. The business, known as Tubby's, is a small bar or pub that serves alcohol pursuant to its license. The business has five video games with names such as Stone Age, Cherry Master, and Haunted House. The games allow customers to accumulate points as they play. The points are then registered on a written slip of paper printed by the video game after each period of play. There are a number of video surveillance cameras in Tubby's which are used to monitor the hallway, bathroom, and bartenders. The bar has experienced trouble in the past with drug deals and installed the cameras to prevent such activities from re-occurring. One of the video cameras, the one pointed toward the video game area, was in fact not actually a working camera according to Tubby's representative.3 On October 19, 2007, two agents employed by the Department conducted an investigation of Tubby's to ascertain whether illegal gambling was going on in the establishment. Special Agent Michael Chandler sat at one of the video machines and played approximately $5.00 worth of currency. Upon completion, he had accumulated 4 points as evidenced by a game slip which printed from the machine. The game slip had the following information printed on it: "TUBBY'S GAME 1; NO CASH VALUE; 1/20/07 01:17:37 1404."4 Chandler gave the slip to the bartender, and it was placed on a red diary or log kept behind the bar. When the slip was later recovered by Chandler, his undercover name (Mike Boone) had been written on the slip. Also written across the top of the slip were the words, "Not Paid. Same guy as last night." Special Agent Robert Baggett also played one of the games. He played $30.00 worth of coins and won 100 points as indicated on his game slips.5 Baggett says another patron told him that he could get actual money for the slips, but that testimony was not confirmed by non-hearsay evidence. Baggett gave his slips to the bartender and asked what he could receive for them. This exchange between Baggett and his counsel at final hearing addressed what happened next: Q: And did the bartender do anything with the game slips? A: He asked me my name, and I gave him my alias. And he advised me that the scores will be tabulated at the end of the week, and that if I got the highest score my name would be placed on the electronic scoreboard that hung next to the bar area. Q: To your understanding, do the game slips have any value? A: Based upon my previous education, training and experience, these points are redeemable for monetary items. Because we have conducted several investigations in the past where we actually were paid out in the form of bar tabs or actual money. There was no mention by the bartender of cash payments being available for the game slips that Baggett acquired at Tubby's. In fact, in contrast to what Baggett had experienced in other investigations, this establishment specifically applied earned points to a non-monetary function, i.e., listing the winners' names on a game board. Based on their determination that illegal gambling was occurring, Chandler and Baggett seized a number of lottery tickets, a bank bag filled with cash, and the game slips from the log book. The cash was primarily twenty-dollar bills wrapped in bundles of $1,000 each for a total of $3,049.00. Each night, the Automatic Teller Machine (ATM) was replenished with cash. The register report produced at final hearing by Respondent clearly indicates a daily deposit of cash into the ATM. Goulet's testimony that the cash in the bank bag was used to replenish the ATM on site at Tubby's is credible. The game slips from customers were shredded or otherwise disposed of at the end of each week because there was no reason to keep them. This explanation is credible. The Department’s concern and position that the slips should be maintained in case some customer questioned his or her point total is speculative and not supported by the facts. Also confiscated from the establishment by Chandler and Baggett was a hand-written list of professional football teams. The list contained the first names or nicknames of 13 individuals, along with a statement of each player's record from the prior week. This sheet was obviously representative of some sort of football pool, but there is no evidence whatsoever that it was used for gambling purposes or involved the payment or exchange of money. The video camera in the gaming area of Tubby's was, as previously discussed, not a working camera. The game area was purposely set up by Tubby's management to look like a casino gambling area. This was meant to enhance the enjoyment of playing the video machines. Goulet testified that Tubby's is an alternative lifestyle bar and that its clientele is fairly regular, i.e., they see the same people over and over. Due to its location off the main thoroughfares, there are not a lot of folks who just drop in to the bar.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Department of Business and Professional Regulation finding that Respondent, Rick's of South Florida, Inc., d/b/a Tubby's, is not guilty of conducting illegal gambling at its business site. Based upon the foregoing recommendation, it is further RECOMMENDED that Exhibits 5, 8, and 10 be returned to Respondent. DONE AND ENTERED this 29th day of May, 2008, in Tallahassee, Leon County, Florida. R. BRUCE MCKIBBEN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 29th day of May, 2008.
The Issue The issue is whether the word, "internal," in Florida Administrative Code Rule 61D-14.041(1) is an invalid exercise of delegated legislative authority because Respondent exceeded its grant of rulemaking authority or because this word enlarges, modifies, or contravenes the law implemented, in violation of sections 120.56(3) and 120.52(8)(b) and (c). In sum, Petitioner and Intervenor challenge rule 61D-14.041(1) only to the extent that this rule requires that each slot machine contain an internal random number generator.
The Issue Whether the proposed repeal of Rule 61D-11.027, Florida Administrative Code, is an invalid exercise of delegated legislative authority because the repeal has the effect of creating or implementing a new rule or policy.
Findings Of Fact The Florida Legislature enacted Section 849.086, Florida Statutes, in 1996. The law authorized the establishment of “cardrooms” at licensed pari-mutuel facilities and dictated the parameters by which games may be conducted at such facilities. In essence, the cardrooms conduct games wherein the players compete against one another. The participants do not wager against “the house.” Instead, the house, that is, the pari-mutuel facility, conducts the games in a non-banking manner. This means the house does not have a financial interest in the outcome of the game(s). For purposes of this case, it is determined that the players who win share fractions of the “pot” created by the entry fees paid to participate in the game(s). The Petitioners in this cause are licensed facilities that have operated cardrooms. Each Petitioner holds a pari- mutuel wagering permit and a valid cardroom license. The Respondent is the state agency charged with the responsibility of administering Section 849.086, Florida Statutes (2005). Section 849.086, Florida Statutes, was amended in 2003 by Section 4, Chapter 2003-295, Laws of Florida. The 2003 amendment imposed a $2.00 bet limitation, with a maximum of three raises per round of betting. This change to the statute required the Respondent to revisit the rules governing cardrooms and, more specifically, the concept of poker “tournaments” being conducted at pari-mutuel facilities. To that end, and after extensive rule-making proceedings, the Respondent adopted rules that were incorporated in Florida Administrative Code Chapter 61D-11. The Respondent intended for the rules to address concerns regarding the $2.00 bet and raise limitations as well as how “re-buys” might affect or potentially allow a violation of such provisions. A “re-buy” describes when a card player is allowed to purchase more chips from the house during a game(s). Florida Administrative Code Rule 61D-11.027 was adopted on May 9, 2004. It was then challenged by pari-mutuel facilities who alleged the rule encompassed more than the statute authorized. Such challenge (DOAH Case No. 04-2950RX), was granted. The Final Order found that the rule (Florida Administrative Code Rule 61D-11.027(2)(a)) exceeded the Agency’s grant of rulemaking authority, modified the specific law implemented, and was arbitrary. Accordingly, the Final Order (DOAH Case No. 04-2950RX) determined that the rule violated Subsections 120.52(8)(b), (c), and (e), Florida Statutes. The Florida First District Court of Appeal affirmed the Final Order by a Per Curiam decision issued on October 28, 2005. Thereafter, the Respondent proceeded with the emergency repeal of the tournament rule in its entirety and issued an advisory letter to all cardroom license holders. The Respondent represented that it cannot reconcile the holding of the court with the explicit language of Section 849.086(8), Florida Statutes (2005). At the hearing, the Respondent represented that additional rulemaking will be necessary. The Respondent does not dispute that tournaments are permissible under the statute. Moreover, the parties agree that prior to the rule, repeal tournaments were conducted using tokens or chips that did not have value. Tournaments were played at licensed cardroom facilities during the period commencing in May 2004 through November 9, 2005. During that time (the period the rule was in effect) counties, cities, and the state received income from the monies remitted by the cardroom facilities. Additionally, the cardrooms employed persons to work the facilities to conduct the various games. After the repeal of the rule, revenues from the cardrooms decreased substantially. Similarly, the cardrooms did not need the number of employees as games were not being conducted. Tournaments at the St. Petersburg Kennel Club have not been conducted since January 17, 2006. From November 2005 through January 17, 2006, the tournaments at the St. Petersburg Kennel Club were conducted using chips or tokens that had “fractional value.” The “fraction” did not correspond to the entry fee charged for the tournament. It is not known whether or not re-buys during the tournaments were allowed. The Respondent issued a Memorandum to Pari-Mutuel General Managers at Cardroom Facilities and Cardroom Managers on January 12, 2006, that provided in part: In light of the recent ruling by the First District Court of Appeals, the Division’s administrative rules regarding tournaments have been repealed on an emergency basis, and are scheduled to be repealed permanently. The Division distributed a memorandum to all cardroom operators regarding Clarification of Cardroom Tournament Rules and Jackpots on November 9, 2005. The Division has also expressed on numerous occasions a serious concern of cardroom operators issuing chips in a fashion that does not represent an even value exchange for money in an attempt to circumvent the $2 bet and three raise limitation outlined in Chapter 849.086(8)(b), Florida Statutes. [Italics in original.] The November 9, 2005, Memorandum referred to in paragraph 14 above provided, in pertinent part: This memorandum is intended to clarify issues regarding the recent ruling by the First District Court of Appeals which affirmed an earlier ruling of the Division of Administrative Hearings (DOAH). The DOAH ruling found that various cardroom rules, which were challenged by Dania Jai Alai and Calder Race Course, are invalid. These rules addressed tournaments, jackpots, the Division’s approval of games, and gifts that enable play in an authorized game. As a result of the ruling, today the Division filed emergency rules to ensure that tournaments are played in compliance with the bet limitation of Section 849.086(8)(b), Florida Statutes. * * * The Final Order that was affirmed by the First District Court of Appeals invalidated the Division’s rules regarding entry fees, re-buys and single table tournaments. The judge held that tournament play is authorized by the cardroom statute. Therefore, cardrooms may set their own entry fees and allow re-buys in tournaments and hold single table tournaments. * * * Unauthorized activity, such as conducting wagering on tournaments that does not conform with the wagering restrictions found in Section 849.086(8)(b), Florida Statutes, or offering of jackpots or gifts that do not comply with the requirements that cardrooms be operated in strict conformity with the statute as required by Section 849.086(3), Florida Statutes, may result in disciplinary action. The memorandums identified above did not change or modify the Respondent’s position regarding whether tournaments are legal or permitted by the statute. To the contrary, the memorandums merely advised the cardroom facilities that they would be held to the statutory standard regarding wagering and that jackpots and gifts would be prohibited. Prior to the appeal of the rule, the Respondent routinely approved tournaments that were based upon the following scheme: A participant paid a $32 buy-in and paid the house $13 for the fee to conduct the tournament. Then the participant received a number of no-value chips that were used to play a multiple number of games of poker. At the end of the designated time, number of games, or whenever the designated end occurred (on the same day of play), winners were announced based upon the number of chips they held. Participants were “ranked” and awarded cash prizes from the pot of entry fees. The $32 entry fee was a mathematical calculation thought to assure that no participant would violate the statute’s bet and raise limitations. Whether or not the “all in” concept violated the statute was not considered as the chips were deemed to have no value in and of themselves. This “no value” chip was a fiction that the Respondent supported as, in theory, the $32 player buy-in comported with a mathematical calculation that was within the statutory guideline. The payouts were determined based upon the number of participants and were set by percentage with the first place person receiving the largest payout. Additionally, participants under the approved scheme were not allowed re-buys. That assured that all participants started with the same number of chips and had the same “betting” potential. Finally, winners were not paid or could not receive prizes outside the “pot” created by the entry fees. A nominal gift (such as a T-shirt) was not considered a violation. Prizes such as giant television sets or vacations were not acceptable. All winnings were to be paid from the buy-in fees and all buy-in fees were to be returned to the players in winnings.
