Untitled Texas Attorney General Opinion ( 1952 )

E Y GENERAL
AunTIN 11. -rE-
PRICE DANIEL
ATTORNEYGENERAL
December 23, 1952
Hon. Odls Tomachefsky Opinion Iio. V-1564.
County Attorney
Waehington County Re: Legality of a drive-in
Brenham, Texas theater’s conducting a
progreaeive drawing
with coupons obtained
free from sponsoring
Dear Sir: merchants.
You hav~e requested of this office an opinion
concerning the legality of a certain sales promotion
enterprlae conducted by a local drive-in theater, In.
view of the statutory prohibition against lotteries.
A representative of the theater has described the scheme
thue:
“We, the Starlite Drive-In Theatre,
Brenham, Texas, propose to give away a free
12-day vacation trip for two people to
California, through an advertising program
to be accomplished a8 follows:
“We are to select 12 local business firma
to participate in the giving away of this va-
cation trip, whereby the merchants are to give
away chance8 on a no-purchase-required basins
to obtain these coupons. They are free.
“People receiving chances on this trip
may deposit the coupons in a hopper located
in the concession stand of the Starllte Theatre
or a hopper at the box office of the theatre,
or they’may be mailed direct to said theatre.
Ipo theatre admission ticket is necessary nor
does the coupon holder have to be preaent to
win.
“We plan tomselect 30 namea on a certain
night of each week. These 30 namea’to qualify
for the final giving away of the trip some
12-weeks after the beginning of the program.
After the selection of these 30 namea, the
coupons not qualifying for the grand hopper will
Hon. Odis Tomachefsky, page 2 (V-1564).
be dcrf~e3ed after each week13 progressive
selection.
“At the end of 12 weeks, we will have
360 coupons from which we will make our
final selection. We will select the winner
by drawing one of these 360 coupons in the
grand hopper. ‘Ilhla person does not have to
Abe preaent to win the trip.”
Your request further states:
“It ia my further understanding, with respect
to the above propoeltlon a8 preaented to my office
by the manager of the local Drive-In Theatre, that
the manager of said theatre le to select 12 local
bualnese firms to participate In this program
by giving away tickets or chances at their local
eatabllehment. These ticketa or coupons are
given away on a non-purchase baeia to anyone
who might enter thelr store. It Is, however,
my further understanding that these merchants
that aTe to participate In this program are to
pay to the manager of the theatre a certafn fee
to help In defraying the cost of advertlefng
this program. Also, that the theatre will pay
a fen,-to the promoter of thle scheme or program,
who will’set up the program foa the theatre a~nd
the merchants partloipating therein.
“It might be further pointed out that lt
Is my understanding that, according to the
program outlined, the parties obtaining the
tickets from the various merchants Involved in
this program.can deposit the tickets either by
personally dr’opping the same in one of the boxes
located at the theatre or by mailing the same
direct to the theatre.”
Section 47 of Article III of the Cdnstitutlon
of Texas dlrecta the Legislature to enact laws prohibiting
the establishment of lotteries and gift enterprises In
this State. Pursuant to this mandate the Legislature
enacted Article 654, Vernon’s Penal Code, which provides:
Hon. Odls Tomachefsky, page 3, (v-1564).
'If any person shall establish a
lottery or dispose of any estate, real or
personal, by lottery, he ahall be fined
not less than one hundred nor more than
one thousand dollars; or if any person
shall sell, offer for aale or keep for aale
any ticket or part ticket In any lot-,
he shall be fined not leas than ten nor
more than fifty dollars."
A lottery has been judicially defined aa a
scheme for the dlstrlbutlon of prizes by lot or chance
among:~pf3rsot&:wh6:haH~p8id~of wh6:havti;agreed to pay
a valuable consideration for the opportunity to win the
award. City of WikiB v. Griffith Amusement Compaq,
129 Tex. 40 100 S . W. 26 695 (im)* 54 C.J.S '843
Lotteri$e, iectlon 1; 28 Tex. Jr. 409, 410, LotteGLee,
Section 2. Thus It ia apparent that every lottery con-
siets of three essential elements, a8 follows: (1)
prize, (2) chance, (3) consideration.
The elements "prize" and "chance" are clearly
present in the plan described In your requ&st. There-
fore our inquiry necessarily will deal with the presence
or absence of the element of consideration.
The Texas courts ha,ve dealt with this question
num@rons times in the conelderation of the various
"Bank Night" contests held by motion picture theaters.
Almoat without exception these games were held to be
lotteFlee despite the fact that chances for the prize
were distributed to large numbers of persons who did
not hold theater tickets, as well a8 to patron8 of the
theaters. The distribution of "free" chances was coa-
sldered but a subterfuge which would not have the effect
of removing the eVetier%@" consideration from an other-
wise Illegal scheme. City of Wink v. Griffith Amusement
!$m&w;,;"T"``. 40, 100 S W d 6 5 (1 36 1
Grim. 548, il.i2S.W?2d $5 igwbb
&ieg. United v. State, 127 S.W.2d 221 Tex.Clv.App.
State v. Robb & Rowley. United, 118 S.W.2d 917
(:%%v.App. 1938). See also Att'y Gen. Op. V-1483 (1952).
A number of other sales promotion enterprieea
ln.which the participating merchants distributed chances
Hon. Odis Tomachefsky, page 4, (V-1564).
for prizes among their customers have been declared
lotteries, even though :many of the chances were - also..
:dlstributed In various wage to non-customers. freatner-
atone v. Independent Service Station Ae6oclatlo~
W 26 24 (T i 1 28) See also Att'y Gen.
0;s: o-:843 (:;;;O;: :;dA:P;42: (1952).
In Smith v. State, 136 Tex. Grim. 611, 127
S.W.2d 297 tlm91. the Court of Criminal Ameal con-
sidered a'pio&G&n scheme known aa "Noah'a'Ark,"
which Is quite sfmflar In many respects to the one des-
cribed In your request. There a number of merchants
paid license feea to a promoter who distributed cards
to the merchants, The merchants distributed these cards
to persons entering their stores, some In exchange for
box tops and other evldenses of purchases, many other8
to persona who did not make purchases at the partlclpat-
ing establlahmentsO These cards of course were chances
for a prize. The coart held that thla plan constituted
a lottery. The license fees paid by the merchant8 con-
stituted consideration moving indirectly from the con-
testants to the promoter, and the merchants received
their consideration in the form of advertising and ln-
creased patronage,
*he moat reoent decision by the Court of Crlm-
inal Appeals Is Brfce v. State, 242 S.W02d 433 (Tex,
Grim. 1951). There the general publfc was Invited to
register'for a conteat held’rat the opening of a new
retail store. Hone of the chances for the awards were
distributed on the basis of purchaases from the donor,
and apparently no ,favoritfsm was &own the customers.
Howeveri the merchant did not pay license fees or
any other form of consideration to a promoter. It was
held that such a scheme doea not vlolate Article 654,
V.P.C., and that the element of conelderatlon was not
added by the mere prospect of Increased patronage.
Previous opinions of this office are in accord with
this result. Att'y Gen. Opa. O-2309 (19&O), v-167
(1947) *
We agree wlth your conclusion that Smith v.
State su ra presents the closest analogy to the plan
iiii8&c&&atlon here. Although the participants
may receive chances on a no-purchase-required baola,
you have stated that the merchants paid certain fee8
to the theater which conducts the drawing. The theater
Hon. Odls Tomachefsky, page 5, (V-1564).
In turn pays a fee to a promoter to set theplan in
operation at the theater and at the stores. This con-
stitutes consideration moving Indirectly from the par-
ticipants to the promoter, and It 18 sufficient to
bring-the scheme within the statutory prohibition.
In this respect, the following language In Smith v.
State, m, at page 298, Is particularly significant:
"We think It clearly appears herein
that appellant received a fee from the 145 merchants
end dealers who pald him a license fee and joined
his 'Noah's Ark' organization, and that the
payment of such fee operated as a consideration
for the entering into the drawing contest of all
persons who came to such dealer's place of business
and requested a card or a stamp for the purpose
of entering thie contest. That this license
fee was the payment of a consideration moving
lndlrectly from the contestant and directly
to thif supervisor or owner of this scheme.
. . .
It is difficult to ascertain from descriptive
literature alone the exact nature of any given scheme
conducted on the lottery principle. The written des-
cription might differ materially from the manner In
which the plan i8 actually carried out. However, It
appear8 from the description of the plan in question
that the element of consideration Is present, and
therefore we agree with you that the scheme Is a
lottery within the contemplation of Article 654,
Vernon's Penal Code.
SUMMARY
A retail sale6 promotion plan in
which prizes are distributed at a motion
picture theater to persons who have obtained
chances either at the theater or at one of
Hon. Odis Tomachefsky, page 6, (V-1564).
twelve participating retail stores Is a
lottery and prohibited by Article 654, V.P.C.,
where the merchants pay a fee to the theater,
which in turn pays another fee to the promoter
o? the plan.
Yours very truly,
PRICE DANIEL
Attorney General
Mary K. Wall
Rev$eYIti&ABslstant
.:‘. Calvin B. Garwood, Jr.
Charlie 0. Mathews Assistant
First Rssis%aht :.
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