THEA~TORNEYGENERAI.
OF TEXAS
Au- 11. ‘I-EXAS
WILL WNLSON
A-J?X-ORNEYOENERAL thy 26, 1960
HonorableR. L. Lattlmore WW-840
CriminalDistrictAttorney .
Edinburg,Texas Re: WhetherAttorneyGeneral's
opinionNo. MS-94 is in
conflicts
with or overruled
by Opitiion
No. W-355
Dear Mr. Lattlmore: relatingto lotteries?
You have asked whetheror not this office still considersOpinion
No. KS-94 to be valid in view of the epprent conflictof this Opinionwith
OpinionNo. W-355. Your requestfurtherstates:
"We are particularlyinterestedas to whether
you still considerthis opiniongoverningthe legality
of 'AppreciationDay' or retailtrade promotionenter-
prises CvalldJ. . . . It would be my opinionthat
OpinionHo. WW-355 1s definitelyin conflictwith the
1953 opinion."
It is the opinionof this office that AttorneyGeneral'sOpinion
No. KS-94, renderedon September25, 1953, is a valid statementof the
laws of this State.
MS-94 holds that, where an award ia made each week to some lndivi-
dual by the merchantsof 8 community,it is not a lotterywhere the award is
determinedin the followingmanner:
"Couponsare distributedfreelyto all desiring
them. The first public approachis by the distribu-
tion of thousandsof printedannouncementsin the
trade territorywith thousandsof theae coupons,all
free. . . .
"In addltlon,couponsmay be freely had forthe
asking at the office of the sponeoringorganieation
. . . and in the places of businessof the participat-
Lng merhhents.. . .
"An individualmay, in fact, ask for severalcoupons,
or for a particulartype of couponand his request
, ,
HonorableR. L. Iattlmore,Page 2. (WW- 840 )
is honored. Said couponmay be of the same
value or varyingvalues indicatedby a percentage
punchedon the coupon. The percentagepunchedon
the couponwill be either 5$, 16, 2C$, 30$, 4C$,
or 50$ entitlingthe party who has receivedthe
coupon end writtenhis or her name and addresson
the reverse side thereofto that percentageof the
fund indicated.
"A thoroughlymixed quantityof the coupons
reposes in an open containeret the Chamberof
Commerceoffice and in an open containerin each
store. A visitormay if he desiresask for a 50$
couponand he will receiveit. Or he may merely
reach into such a containerand securesuch cou-
pon or couponses he desires. Visitorsare, In
fact, invitedto do this. . . .
0
. . . .
"In additionto the ebove,a couponis offer-
ed to anyone making e purchasein 'anyof the
stores. In these instancesthe percentagepunched,
on the couponbeers a relationto the total amount
of the transection,in order that communitysurveys
may be made periodicallyto determinethe size,of
the averageunit purchasein e given atore,the
exact boundariesof the trade territoryfrom which
e store individuallyand the businesscommunity
collectivelydraws its trade,and the amount of
money spent each month in the town from each of the
surroundingerees. . . .
"For the drawings,there is no distinction
made betweencouponsdistributedfreelywith the
announcementfolders,couponsdistributedfreely
from the sponsor'soffice,couponsobtainedfreely
by being drawn out of customersor non-customers
from a containerin the establishment of a member
merchant,couponsgiven freelyto the members of
the audienceattendingthe weekly program,and the
*survey'couponsissuedafter purchases.. . l"
The plan outlinedabove is legal, if no discriminationin favor
of the customerarises. If, for example,the non-customerhad a hard
time getting40$ or 50$ coupons,but the customercould get %urvey" cou-
pons of this type withouttroublethe plan would then be a lotterysince
the customeris gettingsomethinge non-customercaMot acquire. If et
HonorableR L. Lsttimore,Page 3, (WW- 840)
any time e premiumof any kind is allowedthe customerover the non- :
customer,the elementof considerationIs presentand there is a lottery.
Good will and patronageof the persons favoredwith the coupons
Is not considerationpaid, for the purposeof determiningif there is a
lottery. Brice v. State,242 S.W.2d 433 (1951). Also see AttorneyGeneral's
OpinionWW-652.
In Featherstonev. IndependentServiceStetionAss'n, 10 S.W.!d
124 (Tex. Civ. App. 19281,
the court said:,
'1.. . While dealers,under the new plan,.di.s-~,
tributedticketsto non-customerses well as to
customers,it seems that the schemewas to distri-
bute tickets,in the main, to customers;. . .l(
The courtswill look throughany subterfugewhich tries to hide
the elementof consideration.
Insofares W-355 holds that e considerationis presentby virtue
of good will and patronage,it Is in conflictwith the Brice case and the
impliedholdingin &S-94, and WW-355, ia overruledto theextent of such con-
flict.
SUMMARY
1. AttorneyGeneral'sOpinionNo. MS-94
is a valid statementof the laws of
thie St&e relatingto lotteries.
2. AttorneyGeneral'sOpinionNo. i&i-355
is overruledinsofaras,It finds con-
siderationarisingfrom the good will
of the participantsof the plan.
Yours very truly,
WILL WILSON
AttorneyGeneralof Texas
wk~+
By:
Cecil Cammack,Jr.
Assistant
CC:aw
. . .
Eonorab+eR. L. Lattimore,Page 4. (W-840)
APPROVED:
OPINIONCOMMITTEE:
W. V. Gappert,'Chairman
Msrvin Bmwn
T'& ihrrus
CharlesD. Cebaniss
James Parris
REVIEWEDFORTESATTORNEY GENERAL
BY:
LeonardPassmore