                   E                    Y      GENERAL


                           AunTIN   11. -rE-
PRICE  DANIEL
ATTORNEYGENERAL
                               December 23, 1952

      Hon. Odls Tomachefsky          Opinion Iio. V-1564.
      County Attorney
      Waehington County              Re:       Legality   of a drive-in
      Brenham, Texas                           theater’s   conducting a
                                               progreaeive   drawing
                                               with coupons obtained
                                               free from sponsoring
      Dear Sir:                                merchants.
                 You hav~e requested of this office    an opinion
      concerning the legality    of a certain sales promotion
      enterprlae   conducted by a local drive-in    theater,   In.
      view of the statutory    prohibition  against lotteries.
      A representative    of the theater has described    the scheme
      thue:
                   “We, the Starlite Drive-In Theatre,
            Brenham, Texas, propose to give away a free
            12-day vacation trip for two people to
            California,   through an advertising program
            to be accomplished a8 follows:
                  “We are to select 12 local business firma
            to participate  in the giving away of this va-
            cation trip, whereby the merchants are to give
            away chance8 on a no-purchase-required     basins
            to obtain these coupons.    They are free.
                  “People receiving   chances on this trip
            may deposit the coupons in a hopper located
            in the concession    stand of the Starllte Theatre
            or a hopper at the box office    of the theatre,
            or  they’may be mailed direct to said theatre.
            Ipo theatre admission ticket is necessary nor
            does the coupon holder have to be preaent to
            win.
                  “We plan tomselect 30 namea on a certain
            night of each week. These 30 namea’to qualify
            for the final giving away of the trip some
            12-weeks after the beginning of the program.
            After  the selection   of these 30 namea, the
            coupons not qualifying    for the grand hopper will
Hon. Odis Tomachefsky,      page 2 (V-1564).


     be dcrf~e3ed   after    each week13 progressive
     selection.
          “At the end of 12 weeks, we will have
    360 coupons from which we will make our
    final selection.     We will select the winner
    by drawing one of these 360 coupons in the
    grand hopper.    ‘Ilhla person does not have to
    Abe preaent to win the trip.”

           Your request     further   states:

           “It ia my further understanding,    with respect
     to the above propoeltlon    a8 preaented to my office
     by the manager of the local Drive-In Theatre, that
     the manager of said theatre le to select 12 local
     bualnese firms to participate     In this program
     by giving away tickets    or chances at their local
     eatabllehment.    These ticketa   or coupons are
     given away on a non-purchase baeia to anyone
     who might enter thelr store.      It Is, however,
     my further understanding that these merchants
     that aTe to participate    In this program are to
     pay to the manager of the theatre a certafn fee
     to help In defraying the cost of advertlefng
     this program.    Also, that the theatre will pay
     a fen,-to the promoter of thle scheme or program,
     who will’set   up the program foa the theatre a~nd
     the merchants partloipating     therein.
            “It might be further pointed out that lt
     Is my understanding that, according to the
     program outlined,       the parties obtaining the
     tickets    from the various merchants Involved in
     this program.can deposit the tickets         either by
     personally     dr’opping the same in one of the boxes
     located at the theatre or by mailing the same
     direct    to the theatre.”

            Section 47 of Article    III of the Cdnstitutlon
of Texas dlrecta    the Legislature    to enact laws prohibiting
the establishment    of lotteries   and gift enterprises   In
this State.    Pursuant to this mandate the Legislature
enacted Article    654, Vernon’s Penal Code, which provides:
Hon. Odls Tomachefsky,     page 3, (v-1564).


            'If any person shall establish      a
     lottery    or dispose of any estate,    real or
     personal,    by lottery,    he ahall be fined
     not less than one hundred nor more than
     one thousand dollars;       or if any person
     shall sell,    offer for aale or keep for aale
     any ticket or part ticket In any lot-,
     he shall be fined not leas than ten nor
     more than fifty     dollars."

             A lottery  has been judicially     defined aa a
scheme for the dlstrlbutlon       of prizes by lot or chance
among:~pf3rsot&:wh6:haH~p8id~of      wh6:havti;agreed to pay
a valuable consideration     for the opportunity      to win the
award.     City of WikiB v. Griffith   Amusement Compaq,
129 Tex. 40 100 S . W. 26 695 (im)*        54 C.J.S '843
Lotteri$e,     iectlon 1; 28 Tex. Jr. 409, 410, LotteGLee,
Section 2. Thus It ia apparent that every lottery            con-
siets of three essential     elements, a8 follows:       (1)
prize,   (2) chance, (3) consideration.

          The elements "prize"   and "chance" are clearly
present in the plan described   In your requ&st.  There-
fore our inquiry necessarily   will deal with the presence
or absence of the element of consideration.

            The Texas courts ha,ve dealt with this question
num@rons times in the conelderation         of the various
"Bank Night" contests held by motion picture theaters.
Almoat without exception these games were held to be
lotteFlee   despite the fact that chances for the prize
were distributed     to large numbers of persons who did
not hold theater tickets,      as well a8 to patron8 of the
theaters.     The distribution    of "free"   chances was coa-
sldered but a subterfuge which would not have the effect
of removing the eVetier%@" consideration         from an other-
wise Illegal    scheme.    City of Wink v. Griffith      Amusement
!$m&w;,;"T"~~.         40, 100 S W d 6 5 (1 36           1
                   Grim. 548, il.i2S.W?2d $5        igwbb
&ieg.       United v. State, 127 S.W.2d 221 Tex.Clv.App.
         State v. Robb & Rowley. United, 118 S.W.2d 917
(:%%v.App.       1938).    See also Att'y Gen. Op. V-1483 (1952).

            A number of other sales promotion enterprieea
ln.which   the participating merchants distributed  chances
Hon. Odis Tomachefsky,    page 4, (V-1564).


for prizes   among their customers have been declared
 lotteries,  even though :many of the chances were - also..
:dlstributed  In various wage to non-customers.      freatner-
 atone v. Independent Service Station Ae6oclatlo~
    W 26 24 (T        i          1 28)  See also Att'y    Gen.
 0;s: o-:843 (:;;;O;: :;dA:P;42:    (1952).

            In Smith v. State, 136 Tex. Grim. 611, 127
S.W.2d 297 tlm91.      the Court of Criminal Ameal       con-
sidered a'pio&G&n        scheme known aa "Noah'a'Ark,"
which Is quite sfmflar In many respects       to the one des-
cribed In your request.       There a number of merchants
paid license feea to a promoter who distributed         cards
to the merchants,      The merchants distributed    these cards
to persons entering their stores,       some In exchange for
box tops and other evldenses of purchases, many other8
to persona who did not make purchases at the partlclpat-
ing establlahmentsO       These cards of course were chances
for a prize.     The coart held that thla plan constituted
a lottery.    The license fees paid by the merchant8 con-
stituted   consideration    moving indirectly  from the con-
testants   to the promoter, and the merchants received
their consideration      in the form of advertising    and ln-
creased patronage,

              *he moat reoent decision by the Court of Crlm-
inal Appeals Is Brfce v. State, 242 S.W02d 433 (Tex,
Grim. 1951).       There the general publfc was Invited to
register'for      a conteat held’rat the opening of a new
retail    store.    Hone of the chances for the awards were
distributed      on the basis of purchaases from the donor,
and apparently no ,favoritfsm was &own the customers.
Howeveri the merchant did not pay license fees or
any other form of consideration       to a promoter.   It was
held that such a scheme doea not vlolate Article        654,
V.P.C., and that the element of conelderatlon        was not
added by the mere prospect of Increased patronage.
Previous opinions of this office       are in accord with
this result.       Att'y Gen. Opa. O-2309 (19&O), v-167
 (1947) *


           We agree wlth your conclusion   that Smith v.
State   su ra presents the closest   analogy to the plan
iiii8&c&&atlon       here.  Although the participants
may receive chances on a no-purchase-required    baola,
you have stated that the merchants paid certain fee8
to the theater which conducts the drawing.     The theater
Hon. Odls Tomachefsky,      page 5,   (V-1564).




In turn pays a fee to a promoter to set theplan            in
operation at the theater and at the stores.           This con-
stitutes  consideration    moving Indirectly    from the par-
ticipants  to the promoter, and It 18 sufficient          to
bring-the  scheme within the statutory       prohibition.
In this respect,    the following  language In Smith v.
State, m,       at page 298, Is particularly       significant:

            "We think It clearly  appears herein
   that appellant received a fee from the 145 merchants
   end dealers who pald him a license fee and joined
   his 'Noah's Ark' organization,    and that the
   payment of such fee operated as a consideration
   for  the entering into the drawing contest of all
   persons who came to such dealer's     place of business
   and requested a card or a stamp for the purpose
   of entering thie contest.     That this license
   fee was the payment of a consideration     moving
   lndlrectly   from the contestant  and directly
   to thif supervisor  or owner of this scheme.
    . . .

             It is difficult    to ascertain     from descriptive
literature     alone the exact nature of any given scheme
conducted on the lottery       principle.      The written des-
cription    might differ    materially    from the manner In
which the plan i8 actually        carried out.      However, It
appear8 from the description        of the plan in question
that the element of consideration           Is present,   and
therefore    we agree with you that the scheme Is a
lottery    within the contemplation       of Article    654,
Vernon's Penal Code.

                         SUMMARY

           A retail sale6 promotion plan in
   which prizes are distributed   at a motion
   picture theater to persons who have obtained
   chances either at the theater or at one of
Hon. Odis Tomachefsky,   page 6, (V-1564).



   twelve participating   retail stores Is a
   lottery and prohibited   by Article  654, V.P.C.,
   where the merchants pay a fee to the theater,
   which in turn pays another fee to the promoter
   o? the plan.

                            Yours very truly,
                              PRICE DANIEL
                            Attorney General

Mary K. Wall
Rev$eYIti&ABslstant
 .:‘.                           Calvin B. Garwood, Jr.
Charlie 0. Mathews                  Assistant
First Rssis%aht :.

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