Amusement Sales, Inc. v. State
316 Ga. App. 727
Ga. Ct. App.2012Background
- In rem civil forfeiture under Georgia RICO Act against eight electronic game machines at KT’s Place; State sought forfeiture of machines and gym money as proceeds of a pattern of racketeering activity; Amusement Sales owned the machines and challenged forfeiture as innocent owner.
- Amusement Sales argued the machines were bona fide coin-operated amusement devices, not gambling devices, and that it had no actual or constructive knowledge of illegal payouts.
- SADA prosecutors Ekonomou and Lambros pursued the case on a contingency-fee arrangement, which was later challenged as violating public policy.
- Patel testified that cash payouts to customers occurred daily for years, contrary to the store’s gift-merchandise policy; Jue described machine operation and the 30% profit-chain for Amusement Sales; Bairas admitted records were discarded and containers manipulated, hindering investigation.
- The court held: (i) there was substantial evidence supporting the State’s forfeiture theory; (ii) contingency-fee SADAs violated public policy and required disqualification and a new trial; (iii) the jury instruction on the innocent party defense needed revision to align with OCGA 16-14-7(j) for retrial; (iv) Senate Bill 181 later prohibits SADA contingency compensation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the State proved gambling devices and gambling place | Amusement Sales: machines were not gambling devices | Georgia laws define gambling devices and place broadly; machines meet criteria | Evidence supported the verdict; machines were gambling devices and store was a gambling place |
| Whether Amusement Sales was an innocent party | State can forfeit despite innocent-owner defenses | No knowledge; no constructive knowledge | Jury could find constructive knowledge; directed verdict inappropriate |
| Whether SADAs could prosecute on contingency fees | Contingency fees align with public policy | Disqualification unnecessary | Contingency-fee SADAs violate public policy; abuse of discretion; new trial required |
| Whether the jury was properly charged on innocent party defense | Use statutory language defining innocence based on knowledge | Drug forfeiture language inappropriate | Charge should use OCGA 16-14-7(j) language; revise for retrial |
Key Cases Cited
- Tecumseh Products Co. v. Rigdon, 250 Ga. App. 739 (Ga. App. 2001) (standard for sufficiency and appellate review of directed verdicts)
- Aon Risk Svcs. &c. v. Commercial &c. Co., 270 Ga. App. 510 (Ga. App. 2004) (definition and scope of racketeering acts in RICO contexts)
- Cisco v. State of Ga., 285 Ga. 656 (Ga. 2009) (innocent owner construct knowledge framework in rem forfeiture)
- Walker v. State of Ga., 281 Ga. App. 526 (Ga. App. 2006) (constructive knowledge framework in in rem forfeiture)
- Greater Ga. Amusements v. State of Ga., 317 Ga. App. (2) (Ga. App. 2012) (contingency-fee SADAs violate public policy; persuasive authority for disqualification)
- Patel v. State of Ga., 289 Ga. 479 (Ga. 2011) (evidence standards for gambling device characterization)
- Ultra Telecom v. State of Ga., 288 Ga. 65 (Ga. 2010) (reliance on prior definition of allegedly similar devices)