# THEA~TORNEYGENERAI. OF TEXAS Au- 11. ‘ I-EXAS WILL WNLSON A-J?X-ORNEYOENERAL thy 26, 1960
Honorable

R. L. Lattlmore WW-840 Criminal

District

Attorney . Edinburg,

Texas Re: WhetherAttorneyGeneral's opinion

No. MS-94 is in conflicts

with or overruled by Opitiion

No. W-355 Dear Mr. Lattlmore: relating to lotteries? You have asked whetheror not this office still considers Opinion No. KS-94 to be valid in view of the epprent conflict of this Opinion

with Opinion

No. W-355. Your requestfurtherstates: "We are particularly interested

as to whether you still consider this opinion

governing

the legality of 'Appreciation

Day' or retailtrade promotionenterprises CvalldJ. . . . It would be my opinionthat OpinionHo. WW-355 1s definitely in conflict

with the 1953 opinion." It is the opinionof this office that AttorneyGeneral's Opinion No. KS-94, rendered on September

25, 1953, is a valid statement of the laws of this State.

MS-94 holds that, where an award ia made each week to some lndividual by the merchants of 8 community,

it is not a lottery where the award is determined

in the following

manner: "Coupons

are distributed

freelyto all desiring them. The first public approachis by the distribution of thousands

of printedannouncements in the trade territory

with thousands

of theae coupons,

all free. . . . "In addltlon,

coupons

may be freelyhad forthe asking at the office of the sponeoring organieation

. . . and in the places of business of the participatLng merhhents. . . .

"An individual

may, in fact, ask for severalcoupons, or for a particular type of couponand his request, ,

Honorable

R. L. Iattlmore,

Page 2. (WW- 840 )

is honored. Said coupon may be of the same value or varyingvalues indicated by a percentage punchedon the coupon. The percentage punchedon the couponwill be either 5$, 16, 2C$, 30$, 4C$, or 50$ entitling

the party who has received the coupon end writtenhis or her name and addresson the reverse side thereofto that percentage of the fund indicated. "A thoroughly

mixed quantity

of the coupons reposes in an open container et the Chamberof Commerce

office and in an open container in each store. A visitor

may if he desires

ask for a 50$ couponand he will receive it. Or he may merely reach into such a container and secure such coupon or couponses he desires. Visitors are, In fact, invitedto do this. . . .

0

. . . . "In addition

to the ebove,a couponis offered to anyonemaking e purchasein 'any of the stores. In these instances the percentage

punched, on the couponbeers a relation to the total amount of the transection, in order that community surveys may be made periodically to determine

the size,

of the averageunit purchasein e given atore,the exact boundaries

of the trade territory from which e store individually and the business

community collectively

draws its trade,and the amount of money spent each month in the town from each of the surrounding

erees. . . . "For the drawings,

there is no distinction made betweencoupons distributed

freely with the announcement

folders,

coupons

distributed

freely from the sponsor's

office,couponsobtained freely by being drawn out of customers or non-customers from a container

in the establishment of a member merchant,

coupons

given freelyto the members of the audience

attending

the weeklyprogram, and the *survey'

couponsissuedafter purchases. . . l " The plan outlined

above is legal, if no discrimination in favor of the customer

arises. If, for example, the non-customer

had a hard time getting

40$ or 50$ coupons, but the customer

could get %urvey" coupons of this type withouttroublethe plan would then be a lottery since the customer

is gettingsomething e non-customer

caMot acquire. If etHonorable R L. Lsttimore,

Page 3, (WW- 840)

any time e premiumof any kind is allowedthe customer over the non- : customer,

the elementof consideration Is presentand there is a lottery. Good will and patronage of the persons favored with the coupons Is not consideration paid, for the purposeof determining if there is a lottery. Brice v. State, 242 S.W.2d 433 (1951). Also see AttorneyGeneral's Opinion

WW-652.

124 (Tex. In Featherstone v. Independent

ServiceStetionAss'n, 10 S.W.!d Civ. App. 19281,

the court said:, '1.. . While dealers, under the new plan, .di.s- ~, tributed

ticketsto non-customers es well as to customers,

it seems that the scheme was to distribute tickets,in the main, to customers; . . .l( The courts

will look throughany subterfuge which tries to hide the elementof consideration.

Insofares W-355 holds that e consideration is presentby virtue of good will and patronage, it Is in conflict

with the Brice case and the implied

holding in &S-94, and WW-355, ia overruled to theextent of such conflict. SUMMARY

1. Attorney

General's

Opinion

No. MS-94 is a valid statement of the laws of thie St&e relating to lotteries. 2. Attorney

General's

OpinionNo. i&i-355 is overruled

insofar

as, It finds consideration

arisingfrom the good will of the participants of the plan. Yours very truly, WILL WILSON Attorney

Generalof Texas

By: wk~+ Cecil Cammack,

Jr. Assistant CC:aw. . .

Eonorab+e

R. L. Lattimore,

Page 4. (W-840)

APPROVED: OPINIONCOMMITTEE: W. V. Gappert,'Chairman Msrvin Bmwn T'& ihrrus Charles

D. Cebaniss James Parris REVIEWEDFORTESATTORNEY GENERAL BY: Leonard

Passmore