Honorable Tom Hamilton            Opinion No. M-1286
District Attorney
64th Judicial District            HE:   Whether a certain adver-
   Courthouse                           tising scheme whereby
Plainview, Texas   79072                cards are punched and
                                        tokens drawn is a
Dear Sir:                               lottery?

     You have requested our opinion concerning the advertising
scheme of a local merchant awarding prizes by drawings, and have
inquired as to whether the plan would constitute a lottery in
violation of Article 654, Vernon's Penal Code, the more rele-
vant provisions of which read as follows:
            USection 1. (a) 'Lottery' means an enter-
            prise wherein for a consideration the parti-
            cipants are given an opportunity to win a
            prize, the award of.which is determined by
            chance, even though accompanied by some
            skill.
            (b) 'Consideration' means anything which is
            a financial advantage to the promoter or a
            disadvantage to any participant."
     Your description of the plan is as follows:
     "(1) Cards substantially similar to the attached
          example will be printed. These cards will be
          given to any person that comes into the store,
          whether such person makes a purchase or not.

      (2) At the time a card is given to a person, the store
          employee handing out such card will punch out
          the figure nl" at the left end of the card under
          the heading =Free Weekly Punches". Thereafter




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           the person holding such card will be required to
           bring it back to the store each week to have an
           additional number punched out.

     (3)   If a person receiving a card wishes to make pur-
           chases at the store, then, in addition to the
           weekly punch number the amount of each purchase
           will be punched at the right side of the card.
           The card is retained by the person at all times.

     (4)   A large wire drum will be placed in the store.
           Into this drum will be placed tokens upon which
           will be printed a cash value. The minimum cash
           value to be printed on a token will be $1.00.
           The maximum cash value to be printed on a
           token will be $100.00. All tokens placed
           in the wire drum will be printed with a
           dollar value. The number of tokens to be
           placed in the wire drum will be equal to
           the number of cards printed.

     (5)   At such time as the person holding a card has
           had all of the weekly numbers punched out or
           has had all of the purchase sections of the
           card punched out, he is entitled to surrender
           the card to a store employee and to draw one
           token from the wire drum. The store will
           pay such person the dollar amount shown on
           the token.

     (6)   After a person holding a card has completed
           it in one of the two authorized methods and
           has drawn a token, he is entitled to receive
           a new card.

     (7)   The advertising program is to run for a period
           of twelve weeks, and cards will be given out to
           anyone requesting them during such twelve-
           week period. At the end of the twelve-week
           period, no additional cards will be given out;
           however, any person holding a card at the end
           of the twelve-week period will still be en-
           titled to have the card completed, either by
           continuing to secure a weekly number punch or
           by having the purchase record punched out. At



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Honorable Tom Hamilton, Page 3    (M-1286)




          the time of completion such person will be
          entitled to draw a token from the wire drum."
     Texas cases have consistently held that a lottery is com-
posed of three elements: "(1) a prize or prizes; (2) the award
or distribution of the prize or prizes by chance; (3) the pay-
ment either directly or indirectly by the participants of a
consideration for the right or privilege of participating." State
v. Socony Mobil Oil Co., 386 S.W.2d 169, 172 (Tex.Civ.App. 1964,
ref. n.r.e.1 In the plan under discussion, there are clearly
prizes and they are clearly distributed by chance. The con-
trolling question in determining whether this plan constitutes
a lottery is whether the element of consideration is present.

     In your description of the prize plan, there are two ways
in which a person may draw a prize: by having all of the weekly
numbers punched or by having all of the purchase section punched.
Thus there are two classes of participants: non-purchasers and
purchasers. A participant upon completing one card is entitled
to a new card. For the non-purchaser it requires twelve weeks
to complete the first card, while the purchaser may complete
several during that same period. The rules also provide that no
additional cards will be distributed after the end of the initial
twelve week period. Thus the non-purchaser at most could receive
two chances. In contrast, the purchaser could receive any num-
ber, according to how many purchases he made. It is therefore
obvious that in the proposed scheme the purchaser receives addi-
tional chances in the give-away solely because of the purchases,
and in relation to the amount of his purchases. Although it is
true that anyone may participate without making a purchase, it
is also true that additional chances are available in exchange
for puchases made, which but for those purchases are not avail-
able. The purchases would, then, constitute consideration for
those additional chances, rendering the plan, as proposed, a
lottery in violation of Article 654, Vernon's Penal Code.

                       SUMMARY
          The proposed advertising scheme, in providing
     more chances for prizes to purchasers than to non-
     purchasers, constitutes a lottery in violation of
     Article 654, Vernon's Penal Code.




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Prepared by Lang A. Baker
Aesistant Attorney General

APPROVED:
OPINION COMMITTEE
W. E. Allen, Chairman
Ben Harrison
Max Flusche
Gordon Case
Harriet Burke
SAMUEL D. MCDANIEL
Staff Legal Assistant
ALFRED WALKER
Executive Assistant
NOLA WHITE
First Assistant




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