Court Hearing Arguments in a Case That May Determine Legality of Sweepstakes Gambling

A Tallahassee appeals court is hearing arguments this afternoon about whether it should revive a lawsuit that could determine whether Internet cafes violate state gambling laws.

Allied Veterans of the World, Inc., a major operator of the cafes, filed the lawsuit in 2010 after authorities moved to shut down cafes in Pinellas, Jackson, Marion and Seminole counties.

But a Leon County circuit judge tossed out the case, saying it was improperly filed against the attorney general, statewide prosecutor and Florida Department of Law Enforcement commissioner instead of against authorities in the counties.

Allied Veterans is asking the 1st District Court of Appeal to let the lawsuit move forward, as the non-profit organization seeks a declaration that it offers legal sweepstakes games at the cafes — and not illegal gambling, as critics allege.

The case is relevant to Flagler County, where Bunnell and Palm Coast have been contending with a surge in low-stakes gambling joints. Palm Coast had some interest in regulating the parlors, but not in the absence of clearer direction from the state regarding the definition of gambling. Flagler County Sheriff Don Fleming, too, is not interested in prosecuting internet cafes before the court case’s outcome.

Allied Veterans said in court filings that authorities in the four counties took steps such as seizing property, threatening seizures and arrests and, in at least one instance, arresting a worker.

“The arrests, seizures and threats were based on unfounded suspicions that Allied Veterans operates gambling houses and possesses slot machines in violation of the state of Florida’s criminal gambling laws,” the group said in a July brief.

In an August brief, attorneys for the state largely stayed away from the controversial issue about whether the cafes offer illegal gambling.

Instead, the brief said the attorney general, statewide prosecutor and FDLE commissioner had not taken any action against Allied Veterans and, as a result, the lawsuit should be dismissed.

“A party simply cannot bring an action against the attorney general, the statewide prosecutor and the commissioner of law enforcement every time he is accused of violating a criminal statute,” the state’s brief said.

Internet cafes have become a controversial issue as they have popped up in storefronts across the state in recent years. Lawmakers have filed at least two bills for the 2012 legislative session that could put the cafes out of business, targeting what the proposals call “simulated gambling devices.”

Allied Veterans, which says it uses money from the cafes to fund veterans’ health programs, is a major player in the Internet café business. It said in the July court filing that it operated cafes in 13 counties.

The cafes say they offer Internet access, as well as other services to customers. But the controversy centers on people buying Internet time that can be used to take part in computerized sweepstakes games.

Critics contend that the games are akin to slot machines, with the proposed legislation saying that “such simulated gambling encourages the vice of compulsive gambling.”

But in the July appeals-court filing, Allied Veterans compared the concept to other types of business sweepstakes, such as people opening soda bottles and then looking inside the caps to see if they have received winning numbers.

The lawsuit stems from the Pinellas County Sheriff’s Office seizing equipment and closing a café in 2008 and similar circumstances in 2009 in Jackson County, Marion County and the Seminole County city of Longwood, according to court documents.

Allied Veterans filed a lawsuit against the state in 2009, but a Leon County circuit judge dismissed it. The organization filed a revised case in 2010 that made a change of specifically naming the attorney general, statewide prosecutor and FDLE commissioner as defendants.

–Jim Saunders, News Service of Florida, and FlaglerLive