Source: https://docs.justia.com/cases/federal/district-courts/alabama/almdce/3:2011cv00125/45049/56
Timestamp: 2017-07-24 21:00:42
Document Index: 756345523

Matched Legal Cases: ['§ 1332', '§ 1332', '§ 1453', '§ 1446', '§ 8', '§ 13', '§ 8', '§ 1332', '§ 8', '§ 8', '§ 8', '§ 8', '§ 8', '§ 8', '§ 8', '§ 8', '§ 8']

MEMORANDUM OPINION AND ORDER directing that the 22 , 27 and 29 MOTIONS to Dismiss Complaint filed by IGT, Cadillac Jack and Multimedia Games are DENIED for Adams et al v. Macon County Greyhound Park, Inc. et al :: Justia Dockets & Filings Log In
MEMORANDUM OPINION AND ORDER directing that the 22 , 27 and 29 MOTIONS to Dismiss Complaint filed by IGT, Cadillac Jack and Multimedia Games are DENIED. Signed by Chief Judge William Keith Watkins on 11/10/11. (Attachments: # 1 civil appeals checklist)(djy, )
LAFAYETTE ADAMS, et al.,
PARK, INC., d/b/a “VICTORYLAND” )
and “QUINCY’S 777,” et al.,
CASE NO. 3:11-CV-125-WKW
In this lawsuit, 816 Plaintiffs bring a single claim under an Alabama statute that
voids gambling contracts, seeking to recover money they lost playing electronic bingo
machines at Victoryland and Quincy’s 777 in Macon County, Alabama. Defendants
are Macon County Greyhound Park, Inc., doing business as Victoryland and Quincy’s
777; and the owners and operators of the electronic bingo machines, Multimedia
Games, Inc., IGT, Cadillac Jack, Inc., Nova Gaming, LLC, and Bally Gaming, Inc.
Plaintiffs originally filed this lawsuit in the Circuit Court of Macon County, Alabama.
Subsequently, after the filing of the Amended Complaint, this lawsuit was removed
here under the mass action, jurisdictional provision of the Class Action Fairness Act
of 2005 (“CAFA”), see 28 U.S.C. §§ 1332(d)(11) and 1453. Plaintiffs filed a motion
to remand this case back to state court (Doc. # 33), but the court denied that motion,
finding that removal was proper under CAFA (Doc. # 55). With the jurisdictional
issue resolved, the court now addresses the fully briefed motions to dismiss, filed by
Defendants IGT, Cadillac Jack, Inc., and Multimedia Games, Inc. (Docs. # 22, 27,
29.) After careful consideration of the arguments of counsel, the allegations of the
Amended Complaint and the relevant law, the court finds that the motions to dismiss
are due to be denied.
Removal jurisdiction is proper because CAFA’s jurisdictional requirements are
satisfied. See 28 U.S.C. § 1332(d)(11) (governing removals of mass actions, which
are to be treated as class actions under § 1453); 28 U.S.C. § 1446(b) (governing
removal procedures). Personal jurisdiction and venue are not contested, and there are
adequate allegations of both.
showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2). When
experience and common sense.” Id. at 1950 (alteration in original) (citation omitted).
“[F]acial plausibility” exists “when the plaintiff pleads factual content that allows the
alleged.” Id. (citing Twombly, 550 U.S. at 556). The standard also “calls for enough
fact to raise a reasonable expectation that discovery will reveal evidence” of the claim.
Twombly, 550 U.S. at 556. While the complaint need not set out “detailed factual
allegations,” it must provide sufficient factual amplification “to raise a right to relief
above the speculative level.” Id. at 555; see also James River Ins. Co. v. Ground
Down Eng’g, Inc., 540 F.3d 1270, 1274 (11th Cir. 2008) (Twombly formally retired
“the often-criticized ‘no set of facts’ language previously used to describe the motion
to dismiss standard.” (citation omitted)).
At all times pertinent to this litigation, Defendant Macon County Greyhound
Park (“MCGP”) offered pay-to-play electronic bingo machines to the public at its
facility in Macon County, Alabama, under the names Victoryland and Quincy’s 777.2
(Am. Compl. ¶¶ 2, 17.) MCGP is an Alabama corporation, which “is owned, in whole
or in part,” by Milton McGregor (“McGregor”). (Am. Compl. ¶ 2.) The remaining
Defendants – IGT, Cadillac Jack, Inc., Multimedia Games, Inc., Nova Gaming, LLC,
and Bally Gaming, Inc. – are alleged to “own[ ] and operate[ ]” the subject electronic
bingo machines and are deemed citizens of states other than Alabama, to include
Texas, Nevada, Georgia and South Carolina. (Am. Compl. ¶¶ 3-7.)
The 816 Plaintiffs spent “millions of dollars” in wagers playing electronic bingo
machines at Victoryland “during the past” six months. (Am. Compl. ¶ 18; see also
The factual and procedural history of this case is set out in the court’s previous
Memorandum Opinion and Order. (See Mem. Op. & Order (Doc. # 55).) For convenience, the
background information is repeated here. It should also be noted that two similar actions were
filed in this court and are pending before the undersigned. See Adell v. Macon Cnty. Greyhound
Park, Inc., No. 3:10cv122 (M.D. Ala. filed Feb. 16, 2010); Bussey v. Macon Cnty. Greyhound
Park, Inc., No. 3:10cv191 (M.D. Ala. filed Mar. 4, 2010). In Adell and Bussey, as here, the
plaintiffs allege that they lost money playing illegal electronic bingo machines at Victoryland,
and sue to recover those losses under § 8-1-150 of the Alabama Code. Adell, consisting of 853
plaintiffs, was filed as a proposed “mass action,” while Bussey was filed as a proposed class
action. Defendants in this lawsuit also are sued in Adell and Bussey.
For convenience, Victoryland and Quincy’s 777 are referred to together as
“Victoryland.”
Am. Compl. ¶ 32.) All but two Plaintiffs are Alabama citizens,3 and Plaintiffs allege
that “each of their claims individually and aggregately exceed [sic] $10,000.” (Am.
Compl. ¶¶ 1, 10.)
The Electronic Bingo Machines
The alleged illegality of Victoryland’s electronic bingo machines under
Alabama law is at the core of this action.4
Electronic bingo commenced at
Victoryland after the ratification in June 2004 of Amendment No. 744 to the Alabama
Constitution. (Am. Compl. ¶ 12); see also Ala. Const. 1901 amend. No. 744. This
constitutional amendment permits “[t]he operation of bingo games for prizes or money
by nonprofit organizations for charitable, educational, or other lawful purposes.” Ala.
Const. 1901 amend. No. 744. Plaintiffs contend that Amendment No. 744 does not
“authorize the playing of ‘bingo’ through or with electronic devices as have been
used” by Defendants at Victoryland. (Am. Compl. ¶ 13.) Because Victoryland’s
electronic bingo machines allegedly run afoul of Amendment No. 744, Plaintiffs aver
The Amended Complaint alleges that all Plaintiffs are “resident citizens of Alabama.”
(Am. Compl. ¶ 1.) In their motion to remand, however, Plaintiffs acknowledged that two
Plaintiffs are not citizens of Alabama. (Pls.’ Mot. to Remand 3 (Doc. # 33).)
See, e.g., Am. Compl. ¶¶ 3-7 (Defendants “engage in the operation of illegal bingo
games” and “operate[ ] certain illegal bingo devices.”); Am. Compl. ¶ 19 (The “machines
operated” by Defendants “are illegal electronic bingo devices.”); Am. Compl. ¶ 27 (Defendants’
electronic bingo machines are “in fact, ‘slot machines’ . . . which violate the criminal provisions
of Alabama law.”); Am. Compl. ¶ 29 (Defendants used “illegal machines and devices.”); Am.
Compl. ¶ 33 (Defendants’ “electronic gaming operation” is an “illegal gambling operation under
Alabama constitutional, statutory and common law.”).
that the machines “are, in fact, ‘slot machines’ . . . which violate the criminal
provisions of Alabama law, including but not limited to, §§ 13(a)-12-20(10) and
13(a)-12-27.” (Am. Compl. ¶ 28.) Plaintiffs further allege that, during the same time
frame that they patronized Victoryland, the electronic bingo machines were rigged,
from time to time, to ensure wins exceeding $1.6 million collectively for a former city
of Birmingham mayor. (Am. Compl. ¶¶ 35-43.)
Seeking to recover gambling losses they incurred playing Defendants’ alleged
illegal electronic bingo machines, Plaintiffs originally filed this lawsuit in the Circuit
Court of Macon County, Alabama, against MCGP. While the action was pending in
state court, Plaintiffs filed an Amended Complaint, adding as Defendants IGT,
Cadillac Jack, Multimedia Games, Nova Gaming, and Bally Gaming, and also adding
several new Plaintiffs. The governing Amended Complaint contains one state law
count. In that count, Plaintiffs allege that they “entered into wagers” with Defendants,
that those wagers were founded upon illegal gambling consideration and that,
therefore, the contracts are void, pursuant to Alabama Code § 8-1-150. (Am. Compl.
¶ 51.) Plaintiffs “seek the recovery of monies paid to” Defendants “for wagers on
improper and illegal bingo games conducted by [ ] Defendants at Victoryland.” (Am.
Compl. ¶ 52; see also Am. Compl., ad damnum clause (“demand[ing] judgment
against the Defendants for the recovery of the monies paid on all electronic bingo
games played by the Plaintiffs plus interest and the costs of this matter”).)
IGT timely removed this lawsuit to this court, predicating removal jurisdiction
on the mass action, jurisdictional provision of CAFA. See 28 U.S.C. §§ 1332(d)(11)
and 1453. Denying Plaintiffs’ motion to remand, the court found that federal removal
jurisdiction existed. (Mem. Op. & Order (Doc. # 55).) The analysis now turns to the
three pending motions to dismiss, filed by IGT, Cadillac Jack, and Multimedia
Games.5 (Docs. # 22, 27, 29.)
Alabama has had in place for more than 150 years a statute prohibiting the
enforcement of a contract giving rise to a gambling debt. See Ala. Code § 8-1-150.
Section 8-1-150(a), which is titled, “Contracts founded upon gambling consideration
void; recovery of money paid or things of value delivered,” provides:
All contracts founded in whole or in part on a gambling consideration are
void. Any person who has paid any money or delivered any thing of
value lost upon any game or wager may recover such money, thing, or
its value by an action commenced within six months from the time of
such payment or delivery.
To reiterate, this opinion is addressed only to Plaintiffs’ § 8-1-150 claims asserted
against IGT, Cadillac Jack and Multimedia Games.
Id. In 1905, the Supreme Court of Alabama explained that “[t]he object of the statute
avoiding gaming contracts is, besides placing the seal of the law’s condemnation on
such contracts, to put the parties in statu quo as to all money won or lost.” Motlow v.
Johnson, 39 So. 710, 711 (Ala. 1905).
Relying upon Rule 12(b)(6) of the Federal Rules of Civil Procedure, the
Manufacturers attack the factual and legal adequacy of the Amended Complaint’s
allegations to allege a viable § 8-1-150 claim.6 The arguments are addressed below.7
Alleged Factual Deficiencies
The Manufacturers argue that there are no specific factual allegations that
Plaintiffs lost money by playing an electronic bingo machine supplied by any
particular Manufacturer, that any Manufacturer received money lost by a Plaintiff on
Collective references to “Manufacturers” encompass IGT, Cadillac Jack and
Multimedia Games. In the Amended Complaint, Plaintiffs refer to IGT, Cadillac Jack and
Multimedia Games as owners and operators of the electronic bingo machines. (Am. Compl.
¶¶ 3-5.) On the other hand, in a brief, Multimedia Games calls itself a “machine manufacturer.”
(See, e.g., Multimedia Games’ Br. 8 (Doc. # 30).) At this stage, there are only allegations, and
the facts are not developed as to the business relationships among the various Defendants or as to
the nature of IGT’s, Cadillac Jack’s, and Multimedia Games’ activities in connection with the
electronic bingo operations at Victoryland. Accordingly, in this opinion, IGT, Cadillac Jack and
Multimedia Games are referred to collectively as “Manufacturers” for the sake of convenience
and not as a term of legal significance.
IGT, Cadillac Jack and Multimedia Games also are Defendants in Adell v. Macon Cnty.
Greyhound Park, Inc., No. 3:10cv122 (M.D. Ala. filed Feb. 16, 2010), and Bussey v. Macon
Cnty. Greyhound Park, Inc., No. 3:10cv191 (M.D. Ala. filed Mar. 4, 2010). See supra note 1.
These three Defendants make some of the same arguments here that they made in Adell and
Bussey when urging Rule 12(b)(6) dismissal. Those arguments are rejected here for substantially
the same reasons they were found unpersuasive in Adell and Bussey. Hence, the court’s analysis
here, in many respects, mirrors that in Adell and Bussey.
one of its electronic machines, or that directly connect each Manufacturer with money
lost by Plaintiffs. (Cadillac Jack’s Br. 19-20 (Doc. # 23); IGT’s Br. 4 (Doc. # 28);
Multimedia Games’ Br. 9-10 (Doc. # 30).) The Manufacturers assert that the
Amended Complaint “present[s] a possible scenario” that Plaintiffs’ losses occurred
on an electronic bingo machine supplied by another Defendant (IGT’s Br. 4), and that
Plaintiffs improperly “lump[ ]” Defendants together (Multimedia Games’ Br. 11).
Absent allegations that “directly connect” the Manufacturers with any of Plaintiffs’
alleged losses (IGT’s Br. 4), Defendants contend that under Twombly, the facts
pleaded are insufficient to “state a claim to relief that is plausible on its face.” 550
Although the Manufacturers’ arguments are colorable, they are not persuasive
at this juncture. The Amended Complaint pleads more than collective accusations.
There are allegations that Plaintiffs paid money to play electronic bingo machines that
were owned and operated by IGT, Cadillac Jack and Multimedia Games.8 (Am.
Compl. ¶¶ 17-18 (listing manufacturers).) There also are allegations that Plaintiffs
entered into wagers with IGT, Cadillac Jack and Multimedia Games, that those wagers
“were founded upon gambling consideration,” and that the recovery of those lost
IGT and Multimedia Games do not allege that their electronic bingo machines were not present
and available for play at Victoryland during the relevant time period. While Cadillac Jack makes that
assertion, the assertion is contradicted by the allegations in the Amended Complaint, as discussed infra.
wagers are sought. (See Am. Compl. ¶¶ 51, 52; see also Am. Compl. ¶ 10.) Even if
the facts fall at the lesser end of the descriptive continuum, the favorable inferences
drawn from the allegations show wagers placed with each Manufacturer, money paid
to each Manufacturer as wagers, and wagers lost. The alternative explanation offered
by each Manufacturer (i.e., that the machine played was not “mine”) is not so obvious
and overwhelming as to render the claim no longer plausible.
Furthermore, dismissal is not appropriate based upon arguments that the
Amended Complaint fails to specify the amount each Plaintiff lost to Defendants
(IGT’s Br. 3) and fails to “trace each Plaintiffs’ losses to the Defendant that allegedly
profited from the purported loss.” (Multimedia Games’ Br. 10-11 (citing, among
other cases, Funliner of Ala., L.L.C. v. Pickard, 873 So. 2d 198 (Ala. 2003)). These
arguments step into the realm of proof, not pleading. Funliner supports, rather than
contradicts, this point. See 873 So. 2d at 209 (finding class certification inappropriate
and observing that under § 8-1-150, “in order to recover the plaintiffs must establish,
on an individual basis, the amount they lost to the defendants” (emphasis added)); see
also Avitia v. Metro. Club of Chicago, Inc., 49 F.3d 1219, 1226 (7th Cir. 1995) (“A
plaintiff is not required to itemize his damages claims in his complaint.”).
Moreover, Plaintiffs contend that information pertaining to the specific amount
of losses each Plaintiff incurred on a particular Manufacturer’s machine is exclusively
within the Manufacturers’ possession. (Pls.’ Resp. to Mots. to Dismiss 5 (Doc. # 45).)
This argument is not without some force. As this court has recognized, “[n]o plaintiff
could be expected to allege facts of which only the defendants have knowledge and
control.” Hollingsworth v. Edgar, No. 2:04cv935-WKW, 2006 WL 2009104, at *7
(M.D. Ala. July 18, 2006); cf. Endo v. Albertine, 812 F. Supp. 1479, 1497 (N.D. Ill.
1993) (rejecting the argument that the complaint “impermissibly ‘lump[ed]’ the
defendants together” and finding that to satisfy Rule 9(b), the “[p]laintiffs need not
allege facts which are in the exclusive knowledge or control of the defendants”).
For the foregoing reasons, the Amended Complaint contains enough facts to
plead a plausible claim for relief under § 8-1-150. Dismissal is, therefore, not
Alleged Legal Deficiencies
Multimedia Games also contends that under Alabama law, no contract can exist
“between Plaintiffs, who allege that they are casino patrons, and a machine
manufacturer, such as [it].” (Multimedia Games’ Br. 6.) Rather, Multimedia Games
argues that it is well settled “that gambling contracts exist between only the patron and
the casino.” (Multimedia Games’ Br. 7 (emphasis omitted).) Multimedia Games
relies principally on Macon County Greyhound Park, Inc. v. Knowles, 39 So. 3d 100
(Ala. 2009), and Knowles’s observation that “the general rule is that ‘[c]asino-style
wagering is essentially an adhesion contract between the casino and its patrons,’ that
is, ‘the casino defines the terms of the contract (the rules of the wager) and allows
patrons to play the game as-is, with no possibility of changing the rules.’” Id. at 110
(quoting Anthony Cabot & Robert Hannum, Advantage Play and Commercial
Casinos, 74 Miss. L.J. 681, 722 (2005)); (see Multimedia Games’ Br. 7.)
In Knowles, the plaintiff brought a breach of contract claim against MCGP for
its failure to pay her a multimillion dollar jackpot allegedly won playing an electronic
bingo machine at Victoryland. 39 So. 3d at 106. The issue in Knowles was not who
can and cannot be a party to a casino-style gaming contract. That issue was not
explored. Nor was the alleged manufacturer of the electronic bingo machine even a
defendant. See id. at 104, 106. Rather, the issue was whether the terms of a gambling
contract between the sole Defendant, MCGP, and its patron encompassed the rules of
the wager incorporated into the help screens and pay tables of the electronic bingo
machine (as argued by MCGP), or only the sheriff’s regulations (as argued by the
plaintiff).9 See id. at 106. In short, the court finds that Multimedia Games’ reliance
on Knowles for the contention that an electronic machine manufacturer never can be
a party to a casino-style wagering contract as a matter of law is not persuasive.
In Knowles, “the parties agree[d] that Amendment No. 744 remove[d] impediments to the
enforceability of th[e] contract.” 39 So. 3d at 107. Hence, the court “express[ed] no opinion as to
whether Amendment No. 744 actually does authorize the type of activity here involved [i.e., the play of
electronic bingo machines at Victoryland].” Id. at 107 n.1.
(Multimedia Games’ Br. 6.) Here, the Amended Complaint alleges gambling
contracts between Plaintiffs and Multimedia Games, and Plaintiffs will be permitted
to go forward at this juncture with their claim. Accordingly, Multimedia Games’
argument does not warrant Rule 12(b)(6) dismissal of the § 8-1-150 claim at the Rule
12(b)(6) stage.
Cadillac Jack’s Additional Argument
Cadillac Jack makes an additional argument. It contends that § 8-1-150(a)’s
six-month period “runs from July 25, 2010 through January 25, 2011,” the date the
First Amended Complaint was filed (Cadillac Jack’s Br. 3), and that Plaintiffs’ claim
against it is time barred because it removed all of its electronic bingo machines from
Victoryland on or before July 6, 2010. See Ala. Code § 8-1-150(a) (permitting
recovery of money lost upon a wager “by an action commenced within six months
from the time of such payment or delivery”). Cadillac Jack submits an affidavit that
supports its factual contention as to the timing of the removal of the machines. (See
Mauro Franic Aff. ¶¶ 3-4 (Ex. A to Doc. # 23).) On the other hand, Plaintiffs
calculate the six-month period differently based primarily upon principles of tolling
and relation back, and further object to the court’s consideration of the affidavit,
asserting that without discovery they are “are unable to adequately respond to” this
evidence. (Pls.’ Resp. to Mots. to Dismiss 6-7; see generally Pls.’ Resp. to Mots.
to Dismiss 7-10.)
The court cannot consider the affidavit, unless it construes the Rule 12(b)(6)
motion to dismiss as one for summary judgment under Rule 56. See Fed. R. Civ. P.
12(d). Because discovery has not commenced, Plaintiffs have not had an adequate
opportunity to challenge Mr. Franic’s attestations. The court declines, therefore, to
construe the Rule 12(b)(6) motion as one made pursuant to Rule 56. Accordingly, the
Iqbal/Twombly standard applies here, and the court must accept as true all well
pleaded factual allegations in the Amended Complaint. Assuming for purposes of
argument only that the six-month period begins and ends on the dates posited by
Cadillac Jack,10 Plaintiffs sufficiently allege facts from which it can be inferred that,
during the six months preceding the filing of the Amended Complaint, they played
Cadillac Jack’s electronic bingo machines. (Am. Compl. ¶¶ 9, 17, 18.) Because those
facts must be accepted as true under Rule 12(b)(6), Cadillac Jack is not entitled to
dismissal on its argument that none of its machines was housed at Victoryland during
the relevant § 8-1-150(a) time period.
Because Cadillac Jack’s legal argument is tied to evidence outside the pleadings and
because that evidence is not being considered at this juncture, it is unnecessary for purposes of
resolving the pending motions to dismiss to reach a decision on the legal issues pertaining to the
parameters of the six-month recovery period and the application (or not) of tolling and relation
back principles.
Based upon the principles governing Rule 12(b)(6) motions to dismiss, no
ground has been asserted that warrants dismissal of the Amended Complaint.
Accordingly, it is ORDERED that the motions to dismiss (Docs. # 22, 27, 29), filed
by IGT, Cadillac Jack and Multimedia Games are DENIED.
DONE this 10th day of November, 2011.