Court Opinion

ID: 4550077
Source: CourtListenerOpinion
Date Created: 2020-07-22 14:08:02.207043+00
Date Added: 2024-06-11T13:03:10.884019
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
              APPROVAL OF THE APPELLATE DIVISION

                                   SUPERIOR COURT OF NEW JERSEY
                                   APPELLATE DIVISION
                                   DOCKET NO. A-5064-17T3

MICHAEL BANDLER,
                                        APPROVED FOR PUBLICATION
     Plaintiff-Appellant,                       July 22, 2020

v.                                          APPELLATE DIVISION

LANDRY'S INC., GOLDEN
NUGGET ATLANTIC CITY,
LLC, TILLMAN FERTITTA,
and TOM POHLMAN,

     Defendants-Respondents.
_____________________________

           Argued February 24, 2020 – Decided July 22, 2020

           Before Judges Ostrer, Vernoia and Susswein.

           On appeal from the Superior Court of New Jersey,
           Law Division, Atlantic County, Docket No. L-0026-
           16.

           Michael Bandler, appellant pro se.

           Louis Michael Barbone argued the cause for
           respondents (Jacobs & Barbone, PA, attorneys; Louis
           Michael Barbone, on the brief).

           Chanel J. Van Dyke, Deputy Attorney General, argued
           the cause for amicus curiae Office of the Attorney
           General (Gurbir S. Grewal, Attorney General,
           attorney; Melissa H. Raksa, Assistant Attorney
            General, of counsel; Chanel J. Van Dyke, on the
            brief).

      The opinion of the court was delivered by

OSTRER, J.A.D.

      The sole issue presented in this appeal is whether the Casino Control Act

(CCA), N.J.S.A. 5:12-1 to -233, which grants the Division of Gaming

Enforcement (Division) authority to regulate gaming-related advertising,

N.J.S.A. 5:12-70(a)(16), preempts plaintiff's consumer fraud and common law

action alleging a casino hotel falsely advertised a poker tournament.        We

conclude the action is not preempted.      We therefore reverse the summary

judgment dismissal of plaintiff's complaint on that ground, and remand for

further proceedings.

                                      I.

      We discern the following facts from the record, viewed in a light most

favorable to plaintiff as the non-moving party. Brill v. Guardian Life Ins. Co.

of Am., 142 N.J. 520, 540 (1995). Defendant Golden Nugget Atlantic City,

LLC (GNAC) operates the Golden Nugget casino and hotel in Atlantic City.

GNAC advertised a "Grand Poker Series" tournament to be held at its casino in

January 2015.

      Plaintiff, an experienced competitive poker player, saw one of the

advertisements. Although he did not retain a copy of the advertisement he

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viewed, he alleged it announced "$150,000 IN PRIZE MONEY." It listed

twelve "one day tournaments" to be held over ten days. The advertisement

posted various admission fees for each event.

         The advertisement did not expressly state whether the prize money was

guaranteed or not guaranteed. An exemplar that GNAC produced in discovery

also stated in small print at the bottom, "Management reserves all rights to

change or cancel at any time."      It also stated that the official rules were

available in "The Poker Room." However, plaintiff did not recall seeing that

disclaimer.

         In response to the advertisement, plaintiff traveled from his Vermont

home to New Jersey to enter the tournament. He competed successfully in one

event.     Then, GNAC cancelled the tournament due to the low number of

registered players. GNAC stated that, pursuant to the tournament rules, it paid

plaintiff a portion of the limited prize money generated by the entry fees that

the casino collected.

         Plaintiff thereafter filed his complaint alleging a violation of the

Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -224, as well as fraud,

misrepresentation, and civil conspiracy.    He alleged the advertisement was

deceptive, and falsely induced him to attend the tournament based on the

promise that GNAC would pay out $150,000 in prize money. He alleged he

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incurred expenses for travel, lodging, and meals to attend the event and

suffered consequential damages.

      In their answer, defendants denied that the advertisement was deceptive,

noting that it disclosed the tournament could be cancelled at any time. Among

other affirmative defenses, defendants alleged the court lacked jurisdiction to

hear the suit and the complaint was frivolous. Defendants purported to reserve

the right to seek fees under the N.J.S.A. 2A:15-59.1.

      After a period of discovery, plaintiff moved for partial summary

judgment on the CFA claim, asserting the undisputed material facts

demonstrated the advertisement misled him to believe $150,000 in prizes

would be paid.     Defendants cross-moved, arguing that absent an explicit

statement that prize money was guaranteed, the advertisement did not mislead

plaintiff to believe that it was, particularly since the disclaimer stated the

tournament could be changed or cancelled at any time.

      The trial court framed the issue as whether the Division had exclusive

jurisdiction over plaintiff's claims. After soliciting additional briefs on the

issue, the court found it lacked jurisdiction. The court found that the CCA

expressly granted the Division exclusive jurisdiction over all gaming -related

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advertising.1 The court distinguished between non-gaming-related advertising,

like that focused on enticing people to visit casinos, and advertising that

related to the games themselves.         The court concluded that the Division

exercised exclusive jurisdiction over the latter category, which the court found

included the advertisement about which plaintiff complained. Adhering to that

reasoning, the court denied plaintiff's motion for reconsideration.

      Plaintiff appeals from the summary judgment dismissal of his complaint

on jurisdictional grounds. As the case involves the interplay of two statutes

implemented within the Department of Law and Public Safety, we invited the

Attorney General to seek participation as amicus curiae. The Attorney General

urges us to reverse the trial court's order. 2

1
    The CCA was amended in 2011 to modify the responsibilities of the
Division and the Casino Control Commission (Commission). L. 2011, c. 19.
The Division acquired responsibility for overseeing casinos' daily operations,
including reviewing gaming-related advertising – a power previously vested in
the Commission. Id. at § 26. Many of the cases dealing with the CCA were
decided before the amendment and refer to the Commission's jurisdiction, as
opposed to the Division's. Also, the parties and the judge sometimes referred
to the Division and Commission interchangeably. For consistency and clarity,
we refer throughout to the Division as the entity with jurisdiction over gaming -
related advertising.
2
  In November 2019, plaintiff informed us that he filed a bankruptcy petition
and questioned whether the pending appeal was stayed under 11 U.S.C. 362.
In a sua sponte order, we exercised our concurrent authority to determine the
applicability of the automatic stay, see In re Bona, 124 B.R. 11, 15 (S.D.N.Y.
1991), and analyzed the parties' respective claims and defenses, see Maritime

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                                      II.

      We review a summary judgment order de novo, applying the same

standard as the trial court. Davis v. Brickman Landscaping, Ltd., 219 N.J.
395, 405 (2014). Summary judgment shall be entered if the motion record

shows "there is no genuine issue as to any material fact challenged and that the

moving party is entitled to a judgment or order as a matter of law." R. 4:46-

2(c); Brill, 142 N.J. at 540. In this appeal, the issue is a purely legal one,

pertaining to the court's subject matter jurisdiction. Santiago v. N.Y. & N.J.

Port Auth., 429 N.J. Super. 150, 156 (App. Div. 2012). We review that issue

de novo. Ibid. (citing Manalapan Realty, L.P. v. Twp. Comm. of Manalapan,

140 N.J. 366, 378 (1995)).

      Both the CFA and CCA bar false, misleading, and deceptive advertising,

including advertising that is misleading by omission. The CFA declares

unlawful "any unconscionable commercial practice, deception, fraud, false

Elec. Co. v. United Jersey Bank, 959 F.2d 1194, 1204 (3d Cir. 1991) (stating
that "[a]ll proceedings in a single case are not lumped together for purposes of
automatic stay analysis"). Noting that section 362(a) forbids continuation of
an "action or proceeding against the debtor," 11 U.S.C. 362(a)(1) (emphasis
added), we determined that plaintiff's affirmative claims were not stayed,
because they were asserted by the debtor. But, defendants' potential frivolous
litigation claim was stayed because it would be against the debtor. See Action
Drug Co. v. Overnite Transp. Co., 724 F. Supp. 269, 278 (D. Del. 1989)
(where a plaintiff-debtor enters a bankruptcy, defendant may not assert a
counterclaim against the plaintiff), aff’d, 902 F.2d 1558 (3d Cir. 1990).

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pretense, false promise, misrepresentation, or the knowing, concealment,

suppression, or omission of any material fact with intent others rely upon such

concealment, suppression or omission, in the connection with the sale or

advertisement of any merchandise." N.J.S.A. 56:8-2 (emphasis added).3 The

CFA authorizes the Attorney General to promulgate regulations to enforce this

provision, N.J.S.A. 56:8-4, and authorizes private enforcement actions in

court, and recovery of treble damages and attorneys' fees, N.J.S.A. 56:8-19.

      The CCA directs the Division to promulgate regulations "[g]overning the

gaming-related advertising of casino licensees, their employees and agents,

with the view toward assuring that such advertisements are in no way

deceptive[.]"    N.J.S.A. 5:12-70(a)(16).4        The regulations require that

"[a]dvertising shall be based upon fact, and shall not be false, deceptive or

misleading" and "no advertising shall . . . [u]se any type, size, location,

lighting, illustration, graphic depiction or color resulting in the obscuring of

any material fact; or . . . [f]ail to specifically designate any material conditions

or limiting factors." N.J.A.C. 13:69C-14.2(d). The CCA does not expressly

authorize a general private right of action to enforce its provisions and

3
  "Merchandise" is broadly defined to include services, N.J.S.A. 56:8-1(c),
and no doubt covers gaming entertainment.
4
  The statute also provides that such regulations prescribe messages to combat
compulsive gambling. Ibid.

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                                         7
regulations, Miller v. Zoby, 250 N.J. Super. 568, 573 (App. Div. 1991), and

our Court has declined to infer one, Campione v. Adamar of N.J., Inc., 155
N.J. 245, 266 (1998) (declining, in light of the "elaborate regulatory scheme,"

"to imply a cause of action when no such cause of action exists at common

law").

         As the Supreme Court noted in Lemelledo v. Beneficial Management

Corp., 150 N.J. 255, 271 (1997), "regulation is frequently complementary,

overlapping, and comprehensive."        To preserve the goals of overlapping

statutes, the Court set a high bar for preemption.          "Absent a nearly

irreconcilable conflict, to allow one remedial statute to preempt another or to

co-opt a broad field of regulatory concern, simply because the two statutes

regulate the same activity, would defeat the purposes giving rise to the need

for regulation." Ibid.

         To determine if there is such a conflict, we look first to the express

language of the statutes. Both the CFA and CCA address their intersection

with other statutes. "The 'rights, remedies and prohibitions' created by the

CFA are cumulative to any other rights, remedies, and prohibitions created by

the common law or other statutes." Id. at 264 (quoting N.J.S.A. 56:8-2.13).

On the other hand, the CCA provides that if any provision "is inconsistent

with, in conflict with, or contrary to any provision of law, such provision of

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[the CCA] shall prevail . . . ."      N.J.S.A. 5:12-133(b).    Furthermore, the

Division "shall have exclusive jurisdiction over all matters delegated to it or

within the scope of its powers under the provisions of [the CCA]." Ibid.

      We are satisfied that N.J.S.A. 5:12-133(b) does not resolve the issue

before us. We construe this section of the CCA narrowly to avoid casting

aside other remedial legislation. See State v. Resorts Int'l Hotel, Inc., 173 N.J.

Super. 290, 296-97 (App. Div. 1980). With that principle in mind, we discern

no inconsistency or conflict between the CFA's and CCA's prohibition of false,

deceptive or misleading advertising, based on the provisions we have quoted

above. Second, the "exclusive jurisdiction" that is granted to the Division

pertains only to "matters delegated to it or within the scope of its powers."

The CCA delegates to the Division the authority to issue and enforce

regulations governing "gaming-related advertising," but it does not delegate to

it the power to adjudicate common law or non-CCA statutory claims, or to

award damages. Campione, 155 N.J. at 262. Acknowledging the Division's

authority "to establish the rules of licensed games" and "to investigate,

adjudicate, and punish regulatory violations," the Court in Campione noted

that "[n]owhere . . . does the [CCA] delegate to the [Division] the adjudication

of a patron's common-law [discrimination] claims," and concluded that

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                                        9
Legislature had not granted exclusive jurisdiction over those claims or the

plaintiff's contract claims. Id. at 260-61.

      Absent an explicit grant of exclusive jurisdiction to the Division over

plaintiff's claims, we must look to the general statutory scheme to determine

whether the Legislature intended to grant exclusive jurisdiction. See e.g., N.J.

Div., Horsemen's Benevolent Protective Ass'n v. N.J. Racing Comm., 251 N.J.

Super. 589, 601 (App. Div. 1991) (analyzing "whether anything in the

statutory scheme . . . evinces a legislative intent to confer upon the Racing

Commission exclusive jurisdiction to adjudicate all legal and factual disputes

involving control and disposition of the Fund).

      "The language of the CFA evinces a clear legislative intent that its

provisions be applied broadly in order to accomplish its remedial purpose,

namely, to root out consumer fraud."          Lemelledo, 150 N.J. at 264.      In

Lemelledo, our Supreme Court rejected a lender's argument that a CFA claim

over "loan packing practices" was preempted by other statutes governing

lending activities. Id. at 266. The Court applied a "presumption that the CFA

applies to covered practices, even in the face of other existing sources of

regulation, [which] preserves the Legislature's determination to effect a broad

delegation of enforcement authority to combat consumer fraud. Id. at 270.

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      The Court established a rigorous test for determining whether another

statute preempted the CFA:

            In order to overcome the presumption that the CFA
            applies to a covered activity, a court must be satisfied
            . . . that a direct and unavoidable conflict exists
            between application of the CFA and application of the
            other regulatory scheme or schemes. It must be
            convinced that the other source or sources of
            regulation deal specifically, concretely, and
            pervasively with the particular activity, implying a
            legislative intent not to subject parties to multiple
            regulations that, as applied, will work at cross-
            purposes. We stress that the conflict must be patent
            and sharp, and must not simply constitute a mere
            possibility of incompatibility.

            [Ibid. (emphasis added).]

See also Shaw v. Shand, 460 N.J. Super. 592, 610-11 (App. Div. 2019)

(applying the Lemelledo test). That test governs our analysis here.

      We previously addressed the alleged conflict between the CFA and the

CCA regarding deceptive advertising in Smerling v. Harrah's Entertainment,

Inc., 389 N.J. Super. 181, 184-85 (App. Div. 2006). Invoking both the CFA

and CCA, the plaintiffs alleged that promotional advertisements that falsely

promised cash incentives induced them to visit a casino hotel. Id. at 184. The

trial court held that the Division had exclusive jurisdiction over the plaintiffs'

claims and dismissed the CFA claims under Rule 4:6-2(e). Id. at 185-86. We

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reversed, concluding the CCA did not preempt plaintiffs' CFA claims from

proceeding. Id. at 193.5

      Referring to Campione, we noted that "[e]ven in the context of New

Jersey's highly regulated casino industry, the Court has held that the

Legislature 'did not intend to prevent patrons from seeking vindication of

common-law claims in the courts.'" Id. at 189 (quoting Campione, 155 N.J. at

260). Applying the Lemelledo test, we found the Legislature intended to grant

the Division "exclusive control of the regulation of the rules of casino games

and of the content of gaming-related advertising." Id. at 190 (emphasis in

original). By "gaming-related advertising," we understand the court to have

5
    We noted that the trial court also erred in using the terms "exclusive
jurisdiction" and "primary jurisdiction" interchangeably. Id. at 187. We
explained that an agency may have "primary jurisdiction" without depriving
the court of jurisdiction to decide a matter; on the other hand, when an agency
has "exclusive jurisdiction," the court is deprived of decision-making
authority. Id. at 187. That is because exclusive jurisdiction is created when
"the Legislature has vested exclusive jurisdiction with an agency, which
preempts a court's original jurisdiction over the subject matter." Ibid. "Under
the doctrine of primary jurisdiction, on the other hand, 'the case is properly
before the court, but agency expertise is required to resolve the questions
presented.'" Ibid. (quoting Muise v. GPU, Inc., 332 N.J. Super. 140, 159 (App.
Div. 2000)). The primary jurisdiction doctrine is designed to utilize the
agency's expertise and to promote uniform interpretation of an agency's
regulations. Id. at 188. In this case, as the court did not address whether the
Division has primary jurisdiction, we limit ourselves to the issue of exclusive
jurisdiction.

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referred to advertising related to the technical aspects of gaming in which the

Division's expertise was essential, and uniformity was intended.

        Smerling noted two cases holding the Division had exclusive jurisdiction

over a claim regarding signage placed directly on a slot machine. Id. at 190-91

(citing Marcangelo v. Boardwalk Regency Corp., 847 F. Supp. 1222, 1224-25

(D.N.J. 1994), aff'd on other grounds, 47 F.3d 88 (3d Cir. 1995), and Decker v.

Bally's Grand Hotel Casino, 280 N.J. Super. 217, 222 (App. Div. 1994)). We

observed that the federal court relied in part on the CCA's grant of exclusive

authority to the Division "to pre-approve all aspects of a slot machine,

including program, odds and signage, even before the slot machine is installed

on the casino floor . . . ." Smerling, 389 N.J. Super. at 190.

        "Preemptive intent" was also found in Doug Grant, Inc. v. Greate Bay

Casino Corp., 3 F. Supp. 2d 518, 536-37 (D.N.J. 1998), in which the plaintiff

complained about blackjack rules and related advertising to combat card-

counting. Smerling, 389 N.J. Super. at 191. We noted the federal court relied

on the Division's extensive regulation of the blackjack game in holding that

allowing a CFA claim to proceed would disrupt the CCA's regulatory scheme.

Ibid.

        We observed that those cases "dealt with highly technical areas of the

rules of either casino games, casino gaming equipment, or gaming-related

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                                        13
advertising, which are the subject of comprehensive regulation by the

[Division] . . . and consequently fall within the special expertise of the

agency." Id. at 192. The cases did not support preempting the court from

addressing the kind of advertising that Smerling and her co-plaintiffs targeted

in their complaint.   Ibid.   We add another ground for distinguishing both

Marcangelo and Decker: those cases pre-dated Lemelledo, and did not apply

the Court's rigorous test for preemption.

      We held in Smerling there was no inevitable or direct and unavoidable

conflict between the CFA and CCA regarding the advertising involved. Id. at

192-93. Nor would "judicial construction . . . affect the uniformity of the

interpretation or application of the [CCA]'s statutory or regulatory

requirements." Id. at 193.

      We noted that "[t]here is nothing highly sophisticated or technical about

[the] defendants' two promotional schemes."      Id. at 192.   There was "no

reference in either advertisement to the heavily regulated rules of the game or

gaming equipment." Ibid. Rather, "the challenged advertising simply involves

vouchers that resemble coupons used to promote casino visitation and

patronage, similar in type to those ads used to entice patronage of any other

business." Ibid. Therefore, the advertisements lacked content that "calls upon

agency expertise or prerogative to which a court need defer." Ibid. Rather,

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assessment of the advertisements fell well within the court's experience and

expertise. Id. at 193.

      We concluded that the CFA and the CCA concurrently regulated the

advertisements in Smerling. Ibid. "[B]oth the consumer fraud and casino

control schemes regulate with a mutual view toward 'assuring that such

advertisements are in no way deceptive.'" Ibid.

      We reach the same conclusion here. Like the advertisement in Smerling,

the advertisement involved here invited the public to visit a casino by offering

a prize or reward that plaintiff contends was falsely promised. The issue is

whether the statement "$150,000 IN PRIZE MONEY" was deceptive, where

the casino omitted stating it intended to pay $150,000 only so long as enough

people signed up, and the only indirect reference to that intent was the

disputed disclaimer in small print about official rules and the right to change

or cancel the event.

      The advertisement itself does not pertain to arcane or technical rules of

the game. No special expertise vested in the Division is required to resolve the

question. There is no "direct and unavoidable conflict" between the CFA and

CCA provisions, let alone a "patent and sharp" conflict, as Lemelledo requires.

150 N.J. at 270.       There is no significant risk that the CFA and CCA "as

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                                       15
applied, will work at cross-purposes." Ibid. We discern no legislative intent

to preempt plaintiff's CFA or common law claims in Superior Court.

      Our conclusion is supported by the Attorney General, who, through the

Division of Consumer Affairs and the Division of Gaming Enforcement,

implements both the CFA and CCA. We attach great weight to an agency's

interpretation of a statute it is charged with implementing, particularly those

that require technical expertise.    N.J. Guild of Hearing Aid Dispensers v.

Long, 75 N.J. 544, 575 (1978) (stating "the opinion as to the construction of a

regulatory statute of the expert administrative agency charged with the

enforcement of that statute is entitled to great weight"); see also Waksal v.

Dir., Div. of Taxation, 215 N.J. 224, 231 (2013). That interpretation may

come to us in the form of an amicus brief. U.S. Bank, N.A. v. Hough, 210 N.J.

187, 200 (2012) (considering agency interpretation of statute in invited

appellate amicus brief, where agency was not a party to the trial court action).

      The Attorney General contends that Lemelledo provides the guiding

principle for resolution of this case.       He argues that absent a direct and

unavoidable conflict between the CFA and CCA, preemption is unwarranted;

and, as it pertains to the advertising involved in plaintiff's action, there is n o

such conflict. We agree.

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Reversed and remanded. We do not retain jurisdiction.

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                               17