Board of Liquor License Commissioners for Baltimore City v. Kougl
154 A.3d 640
| Md. | 2017Background
- In April 2013 an undercover police detective at Club Harem (owned by Steven Kougl/Kougl, Inc.) was solicited by an employee who exposed her breasts and offered sexual services; no money exchanged and the employee’s later prostitution charge was nolle prossed.
- In July 2014 the Baltimore City Board of Liquor License Commissioners charged Kougl with violating Liquor Board Rules 4.17(a) (solicitation/prostitution), 4.17(b) (indecent exposure/obscenity), and 4.18 (prohibition on illegal activity) based on the employee’s conduct on the licensed premises.
- The Liquor Board found Kougl guilty and suspended his liquor license for 30 days; the Circuit Court affirmed that decision.
- The Court of Special Appeals reversed, holding that the words “permit,” “suffer,” and “allow” require actual or constructive knowledge by the licensee and that no such knowledge was shown.
- The Court of Appeals granted certiorari to decide whether the Liquor Board Rules impose strict liability (no knowledge element) for prohibited conduct on licensed premises.
Issues
| Issue | Plaintiff's Argument (Liquor Board) | Defendant's Argument (Kougl) | Held |
|---|---|---|---|
| Whether Rules 4.17(a)/(b) and 4.18 require licensee knowledge | Rules impose strict liability; plain words “permit/suffer/allow” do not require knowledge | Licensee must have actual or constructive knowledge (or should have known) to be liable | Held: Rules impose strict liability; no knowledge element required |
| Whether use of “knowingly” in one clause implies knowledge required elsewhere | The presence of “knowingly” only in one clause shows the Board intentionally omitted mens rea elsewhere | The inclusion of “knowingly” was incidental; knowledge should be required generally | Held: Inclusion of “knowingly” in one clause supports interpreting other unmodified clauses as strict liability |
| Whether Dawkins three-factor test (public welfare offense analysis) applies | Rules regulate public welfare and support strict liability; Dawkins factors confirm it | Dawkins/McCallum show similar offenses require mens rea; adopt willful blindness standard | Held: Dawkins analysis for criminal statutes is unnecessary here because these are civil regulatory licensing rules; no presumption against strict liability |
Key Cases Cited
- Morissette v. United States, 342 U.S. 246 (U.S. 1952) (distinguishes traditional crimes from public-welfare regulatory offenses allowing strict liability)
- Dawkins v. State, 313 Md. 638 (Md. 1988) (three-factor public-welfare test for imposing strict liability on criminal statutes)
- McCallum v. State, 321 Md. 451 (Md. 1991) (refused to apply strict liability to driving while suspended; discusses mens rea and willful blindness)
- Hoyle v. Bd. of Liquor License Comm’rs for Balt. City, 115 Md. App. 124 (Md. Ct. Spec. App. 1997) (upheld strict liability for sale of alcohol to minors under similar rule structure)
- Jordan v. State, 405 Md. 420 (Md. 2008) (interprets legislative omission of mens rea in statutory scheme as evidence of intent to impose strict liability)
- Garnett v. State, 332 Md. 571 (Md. 1993) (omission of knowledge language indicates intent to impose strict liability in statutory rape context)
- Div. of Alcoholic Beverage Control v. Maynards Inc., 927 A.2d 525 (N.J. 2007) (liquor regulation interpreting “suffer” to impose licensee responsibility regardless of knowledge)
- City of West Allis v. Megna, 133 N.W.2d 252 (Wis. 1965) (interpreting “suffer or permit” in liquor regulation as strict liability for licensees)