Honorable John R. Shook Opinion No. O-3990
Criminal District Attorney
San Antonio, Texas Re: Whether or not certificate scheme
of newspaper is a lottery, and re-
Dear Sir: lated questions.
Your request for an opinion of this department has been
received and considered. We quote from your request:
“We enclose herewith certain copies of issues
of the San Antonio Light and it is our information that
the scheme complained of is substantially as follows:
“This newspaper has undertaken to distribute,
through its agents, certain certificates, gratis, to any
and all persons desiring same, whethe,r they be sub+
scribers of such newspaper or not, a facsimile of which
certificate appears upon page 4-A of the edition of Sep-
tember 5, 1941, enclosed herewith. A drawing is held
every day and, if the number of the holder of acertifi-
cate is drawn in such drawing, upon proper presentation
of such certificate, such holder is entitled to receive a
prize. The method is fully explained in the enclosed
newspaper.
“Under the above facts, would the president,,
general manager, circulation manager and other em-
ployees and agents of such newspaper be guilty of a vio-
lation of Article 654 of the Penal Code of the State of
Texas ?
“It is OUF information that the parties making
this inquiry are also desirous of ascertaining whether
or not an injunction suit will lie to restrain the opera-
tion of this enterprise, and if so, in whose name and by
whom such injunction suit shall be brought and main:-
tained.
Hon. John R. Shook, Page 2 (o-3990)
“It is our information that the publisher of this
newspaper is a private corporatfon. * * * .
” * * *:, Under the above statement of facts,
will an action by quo warrant0 or injunction lie in be-
half of the State on relation of the Attorney General
against a private corporation violating the provisions
of Section 4’7. Article 3 of the Constitution of Texas. or
particle 654, Penal Code of Texas?”
As a supplement to the facts submitted in your inquiry.
,we desire to quote from one of the newspaper exhibits which you have en-
closed. Said exhibits show the following:
“DO YOU HOLD A WINNING NUMBER?
$2400.00 CASH GIVEN AWAY!
“Look at the number on your certificate and,check it with
the comic on this page bearing ,the same name. If you hold
one of these winning numbers. bring it within two days to
the San Antonio Light and receive your Golden Opportunity
cash award.
y$25.00 FIRST PRIZE
$75.00 IN ADDITIONAL CASH PRIZES
“If you do not hold a winning number today--KEEP YOUR
CERTIFICATE as it may be a winner another day.’
“100.00 CASH PRIZES DAILY ~”
FOR THE NEXT 23 WEEK DAYS!
“HOWE TO’WIN
“Each week day until $2400.00,in cash has been given
away, 39 number’s will be printed above six comics that
appear in The San Antonio Light daily. Compare num-
ber of your Certificate with those that are published
daily in The Light and,posted at the following places:
The display window of The San Antonio Light, Broadway
and Fifth Street, and all suburban theatres. YOU May
Win Any Day. Save Your Certificate.
Hon. John R. Shook, Page 3 (O-3990),
“READ THE RULES
YTo win, the number of your Golden Opportunity Certi;
ficate must be printed above the corresponding comic
in The San Antonio ,Light. Holders of winning Certifi-
cates must present ,the certificate .to The San Antonio
Light, Broadway at Fifth Street, no later thazitwo da,ys
after the number has been published. Prize awards
will be made between the hours of 8:3,0 a,m. and 4 p.m.
,’
“SPECIAL NOTICE ,.,
UIt is not necessary to be a regular reader of The San
Antonio Light to participate in the awards. Copies of
The Lights may be seen without charge at the San An-
tonio Light office. Winning numbers will be posted’in
the lobby of thenfollowing theaters: Br,oadway Theater, ~’
Uptown Theater, Harlandale Theater, Highland Park ”
Theater. ,First winning numbers will be published daily
on the Comic page of The Light beginning Friday, Sep-
tember 5, 1941, and until further notice.
~UIMPORTANT TO REMEMBER
“All Golden Opportunity Certificates are labeled with
one of six comics., namely, BRINGING UP FATHER,
~THE NEBBS. TILLIE THE TOILER, SNUFFY SMITH.
BLONDIE, SKIPPY 0
“Winning numbers will appear above these comics be-
ginning Fiiday, September ,5. To win a cash pr.ize, the
certificate you hold must bear the name of one of the
above comics and have the same number that appears
,above that particular comic.”
Section47 of Article III of our Texas Constitution pro-
vides:
“The Legislature shall pass laws prohibiting the
establishment of lotteries and gift enterprises in this estate,
as well as the’sale of tickets in lotteries. gift enterprises,
or other evrtsions involving the lottery principle, estab-
lished or existing in other States.”
Pursuant to the mandate of the Constitution our Legisla-
ture enacted Article 654 of the Penal Code of the State of Texas, which
provides:
Hon. John R. Shook, Page 4 (O-3990)
“If any person shall establish a lottery or dis-
pose of any estate, real or personal, by lottery, he shall
be fined not less than one hundred nor more than one
thousand dollars; or if any person shall sell, offer for
sale or keep for sale any ticket or part ticket in any lot-
tery, he shall be ffned not less than ten nor more than
fifty dollars.‘”
Our Texas Supreme Court has held in the City of Wink
vs. Griffith Amusement Co.., 100 S.W. (2d) 695, that Article 654 of the
Penal Code, supra, applies only to lotteries and does not include “gift
enterprises’” and @other evasions involving the lottery principle.”
It may be generally said that our Texas Courts, both
Civil and Criminal, have clearly laid down the principles of a lottery to
be: (1) a prize or prizes; (2) the award of distribution of the prize or
prizes by chance; (3) the,, payment’either directly or indirectly by the par-
ticipants of a consideration for the right or privilege of participating,
See City of Wink vs. Griffith Amusement Co,, supra; Cole vs. State, (Ct.
Cr~im.App.) 112 S.W. (2d) 725; Smith vs. State, (Ct. Grim. App.) 127 SW.
(2d) 297; Featherston vs. Independent Station or Association, (Ct. Civ.
App.) 10 SW. (2d) 124.
That the first two enumerated elements are present in the
plan or scheme submitted by you could not be se~riously questioned. We
now proceed to discuss whether the third element of consideration is pres-
ent.
In considering whether a plan or scheme is a lottery the
court “will inquire not into the name, but into the game, however skill-
fully disguised, in order to ascertain if it is prohibited or if it has the
element of chance.” Cole vs. State, supra.
Looking to the very nature of the plan or scheme under
cons~iderationitpnrat be obvious that the real purpose~of the plan is to in-
crease or aid the newspaper’s business by the distribution of prizes in
money, by chance, and to induce persons to purchase or subscribe to the
newspaper, the inducement of a prize to c~ertain lucky holders of certifi-
cates being predominant. We think it could easily be said that such a plan
would inure to the benefit and advantage of the newspaper in several ways.
It is well known that a newspaper’s scope ‘is gauged by its circulation more
than any other single factor. Its effectiveness and desirability as a medium
,of advertising, from which it derives its principal income. depends prin-
cipally upon its circulation. No doubt the plan would create and stimulate
‘considerable good will for the newspaper in the eyes of many people who
would be more impressed with the opportunity of winning a cash prize
through chance and the generosity of the management than the news con-
tent of the newspaper. As was said by Judge Graves in the case of Cole
Hon. John R. Shook, Page 5 (O-3990),
vs. State, supra;~on motion for rehearing, ,‘after all it is but a scheme in
our judgment, for the purpose of distributing prizes by,chance.’ Our opin-
ion, concerning theneffect, and design of the planor scheme under c,onsid-
eration, is well expressed in the words of Judge Lattimoie:in Cole vs.
State, supra, quoting,withapproval from State vs. Dans, 140 Wash. 546,
where he said: QIanifestly, it was the plan~and purpose of the appellants
to get additional money by ,putting on the chance #drawing.” ‘~
,.,
Insofar ,as~ the plan or scheme is concerned we think it is
im~material that some persons might possibly receive .a prize without buy-
,ing a paper or being,a subscriber. City of Wink vs. Griffith ‘Amusement
Co.,, supra; Cole ,vs. State, supra. Those putting on the plan; or using and
promoting the scheme, under the facts submitted, would doubtless be op-
erating a lottery regardless of whether some of ‘the certificates’or chances
were obtained by persons who in fact obtained them without giving a di-
rect or~indirect consideration. Purchases ‘or, subscribers to the paper
would ce’rtainly be considered to have paid at least an indirect considera-
tion for the privilege of participating in the lottery. See City of Wink vs.
Griffith Amusement Co.;,supra; Colevs. State, hupra. We think this means
of a free distr’ibution is obviously designed as -an evasion ore attempted eva-
sion of the lottery laws and is ~more theoretical than real. To hold other-
wise would,. in our opinion, make a mockery of our lottery laws and sanc-
tion the opera,tion of lottery by the mere imposition of an artifice in the
nature of a fictional technicality in thelaw which; is contrary to the spirit
of Article III. Section 47 of the Texas Constitutiori.
From what we have said, it follows, that w.e find all of
the elements of a lottery exist in the newspaper plan or scheme, submitted
in your request. Y~ou are, therefore, advised that in our opinion the plan
or scheme ~of, the, San,:Antonio Light newspaper, is a lottery and is prohib-
ited by Article III, Section 47 of the Constitution,and Article 654 of the Penal
Code of the State of Texas.
owe find no,provision made in Article 654,of the Penal Code:
of.the State of Texas, nor any statute that i,s applicable, whioh provides for,
the prosecution and punishments of a corporation for operating a lottery.
We think the rule is applicable to the corporation that has been laid down
by the Court of Criminal Appeals in Judge Lynch International Book & Pub-
lishing Company vs. State, 84 Tex, Grim. R. 445, 208,S.W. 526, where it
:was said: .”And we call attention to the fact that Section 6 of the Act * * *,
which is the one containing the penalty clause, only mentions, ‘any ~person’
as punishable and thus. in a criminal statute and prosecuti’on, must be a
natural :person and omits reference to any firm or corporation, * *,*.,”
;
With refer’ence to the criminal liability of the officers and
agents of the corporation, under the facets submitted by yaw, for viohthzg
Article 654 of the. Penal Code of Texas2 we desire ,to quote from 19 Corpus
Juris Secundum, Section 931, Pages 363-364, which reads:
Hon. John R. Shook, Page 6 (o-3990)
“Officers, directors, or agents of a corporation
participating in a violation of law in the conduct of the
company’s ,business may be held criminally liable Indi-
vidually therefor. So, although they are ordinarily not
c:riminally liable for corporate acts performed by other
officers or agents, and at least where the crime charged
involves guilty knowledge or criminal intent, it is essen-
tial to criminal liability on his part that he actually and
personally do the acts which constitute the offense or that
they be done by his direction or permission. He is liable
where his scienter or authority is established, or where
be is the act&l present and efficient actor, * * *.”
See also 13 American Jurisprudence, Pages 1027-1030, inclusive.
In this same connection we quote from 12 Texas Juris-
prudence, Page 279, which reads, in part, as follows:
“An illegal act cannot be justified by an order
from superior authority no matter how high the source
from which it emanates. The fact that a person acts as
agent for another or in obedience to orders of his em-
ployer in committing an offense is no excuse, where he
has knowledge of the principle or employer’s criminal
intent and the fact that one who aids or assists another
in those things which make out guilt under the law does
so for accommodation or for pay does not render him
guiltless. * * *.”
We are, therefore, of the opinion that in order for the of-
ficers or agents of the corporation to be liable to prosecution under Ar-
ticle 654, supra, for operating a lottery, it must be shown that said offi-
cer or agent has personally participated with the corporation in the es-
tablishment of the lottery or that such acts were done by and through such
officer or agent’s direction or permission. This would clearly involve
facts which are not before us and we cannot, for that reason, answer your
first question specifically.
Since we have held that the plan or scheme under consid-
eration is a lottery then it follows that it can be abated and enjoined as a
nuisance by an injunction suit instituted under and authorized by Articles
4664-4667, inclusive, of Vernon’s Civil Statutes of Texas. The State vs.
Robb & Rowley United, (Civ.App.) 118 S.W. (2d) 917; Robb & Rowley United,
Inc., et al vs. State, (Civ.App.) 127 S.W. 221; Aetna Club, et al vs. State,
(Sup.Ct.) 199 S.W. 1090; also our Opinion No. O-2286. Under the above
cited statutes and authorities, suit may be instituted in behalf of the State
by either the Attorney General, or the District or County Attorney. In
Featherstone vs. Independent Service Station Association, Inc., supra, it
was held that a merchant who was injured by the action of his competitors
Hon. John R. Shook, Page 7 (o-3990) ,,,
in conducting a lottery in,vi.olation of Article 654, supra, could maintain
an action in .a court of ,equity,and have the. operation of, such lottery en-
joined. Your second questiorris answered accordingly.
We now consider your third or last question.
.,
Article iVi Section~22 of the Texas Constitution, pro-
vides: ,, ..:, :, .~
,,~ !,,. ,. I
“The Attorney GeneraJ * * .* shall represent, :, :
the State in all suits and pleas in the: Supreme Court _~ .,
.of the’Stam in: which the State, may be a.party, land.,. :
: sha,lZ especially~,inquir.e into the charter rights of all
pri?te corporations,, land. from time~.to times. in the
name of the State, take such action in the c’ourtsas
may be proper and necessary to prevent any private
corporation from exercising .any power 4: * * not au-
thorized by law. He shall, whenever sufficient cause
exists, seek a judicial forfeiture of such charters, un-
less otherwise expressly directed by law, * * 4.”
Pursuant to the above quoted constitutional provision,
the Legislature enacted the quo warrant0 statutes, being Title 111 of Yer-
non’s Civil Statutes of Texas.
In the City of Wink vs. Griffith Amusement Co., supra,
Judge Cureton said, with reference to the City of Wink:
“It cannot maintain its cross-action or suit
for injunction for two reasons; first. because..the or-
dinance which it seeks to enforce by injunctive relief
is void; and, second, because the right to enjoin a cor-
poration for violating the public policy of the State as
an abuse of its corporate franchise has not been con-.
fided to the plaintiff in error, but to the Attorney Gen-
eral. Constitution. Article IV, Section 22.”
A corporation may in the course of ,maintaining a nuisance
likewise violate its charter. Aetna Club, eta1 vs. State, supra.
We quote from State vs. Wailer. (Civ.App.) 211 S.W. 322,
(writ of error dismissed):
“It is settle,d in Texas that under the provisions
.of the quo warrant0 statutes, (Revised Statutes of 1911.
Article 6398) that a proceeding to forfeit the charter of a
corporation can only be instituted by the Attorney General
of the State, and that the attempt to confer such power on
the District or County Attorney is in violation of Article IV.
m’
..
.
Hon. John R. Shook, Page 8 (,O-3990)
‘Set, 22.of.the Constitution. State vs. Railway, 89 Tex.
562, 35 S.W. 1067; Brady vs. Urooks, 99 Tex. 379, 89
S.W. 1052; Oriental Oil Co, vs. State, 135 S.W. 722.
0 * ***
We have held that the corporation is, in our opinion, con-
ducting a lottery which is condemned by the Constitution of this State and
therefore contrary to public policy. It fOllOW6, therefore, that an injunc-
tion suit could be maintained by the Attorney General against said cor-
poration to -enjoin it from violating the public policy of the State as an abuse
of its corporate franchise. City of Wink vs. Griffith Amusement Co., supra.
We are also of the opinion that, under the facts submitted by you, a quo
warranto proceeding will lie in behalf of the State on relation of the Attor-
ney General against said corporation. Your third, and last question is an-
swered accordingly.
We trust that we have fully answered the questions sub-
mitted in your inquiry.
Yours very truly
ATTORNEY GENERAL OF TEXAS
By /s/ Harold McCracken
Harold McCracken
APPROVED OCT 4, 1941 Assistant
/s/ Gerald C. Mann
ATTORNEY GENERAL OF TEXAS
HM:RS/cm APPROVED
Opinion
Committee
By/s/ BW B
~hazrman