BENEVOLENT AND PROTECTIVE ORDER OF ELKS #2656, Plaintiff/Appellant,
STATE OF ARIZONA DEPARTMENT OF LIQUOR LICENSES AND CONTROL, Defendant/Appellee
Appeal from the Superior Court in Maricopa County. No. LC2014-000104-001. The Honorable Crane McClennen, Judge.
Charles E. Buri, PLC, Phoenix, By Charles E. Buri, Co-Counsel for Plaintiff/Appellant and Guttilla Murphy Anderson PC, Phoenix, By Nicholas C. Guttilla, Co-Counsel for Plaintiff/Appellant.
Arizona Attorney General's Office, Phoenix, By Michael Raine, Counsel for Defendant/Appellee.
Judge Andrew W. Gould delivered the opinion of the Court, in which Presiding Judge Donn Kessler and Judge Patricia K. Norris joined.
Andrew W. Gould, Judge:
[¶1] The Benevolent Order of the Elks (the " Elks" ) appeals the superior court's judgment affirming the decision by the Arizona Department of Liquor Licenses and Control (" Department" ). In its decision, the Department fined the Elks $200 for conducting unlawful gambling activities in violation of Arizona Revised Statutes (" A.R.S." ) section 4-244(26). For the following reasons, we affirm.
FACTS AND PROCEDURAL HISTORY
[¶2] The Elks is an Arizona non-profit organization licensed to sell liquor by the Department. In 2010, the Elks entered into a contract with Patriots Land Group (" Patriots" ) to run a " sweepstakes," for the stated purpose of charitable fundraising. Pursuant to the contract, the Elks leased computer equipment, software, and furniture from Patriots to conduct the sweepstakes. The sweepstakes equipment consisted of a kiosk, which housed a file server connected to a game terminal; each game terminal had a video monitor, a mouse, and a magnetic card reader. In addition, Patriots agreed to provide operational support consisting of training, computer/equipment maintenance and repairs, and software updates.
[¶3] In April 2010 the Elks started offering the sweepstakes to its members. The sweepstakes kiosks were housed in the Elks' Lodge and were available for use during the Elks' hours of operation. To participate in the sweepstakes, a member obtained a player card, provided by Patriots, from the Elks' bar manager or bartender. Each card had a magnetic strip and a sweepstakes identification number on the back.
[¶4] Once a member received a sweepstakes card, he participated in the sweepstakes by running the card through the kiosk's card reader and placing money in the kiosk's bill acceptor. Members paid one dollar for each play.
[¶5] The software provided by Patriots generated " prize pools" consisting of cash prizes. The pools were funded by the money members paid to purchase plays. Each play included the chance to win cash prizes of up to $1,199.
[¶6] If a member won, the software added the prize amount to his card. When a member wished to redeem his winnings, he would print out a redemption ticket from the kiosk, give the ticket to the bar manager or bartender, and receive a cash payout. The Elks maintained a daily bank of $500 to redeem winnings.
[¶7] Members were not required to pay for all of their plays. Members could receive one free play a day. However, over the course of the Elks sweepstakes, only nine to ten percent of the sweepstakes plays were free plays.
[¶8] Members could also obtain free plays by mailing a request, with a self-addressed stamped envelope, to Patriots. There was no limit on the number of mail-in requests that could be submitted by a member. Patriots, however, ...