J&J Ventures Gaming, LLC v. Wild, Inc
2016 IL 119870
| Ill. | 2017Background
- The Video Gaming Act legalized video gaming terminals in licensed Illinois establishments and vested the Illinois Gaming Board (Board) with authority to license, regulate, and supervise video gaming operations and adopt implementing regulations.
- Action Amusement (unlicensed) executed exclusive location agreements with several establishments, then assigned those agreements to Action Gaming (unlicensed), which later assigned them to J&J Ventures (licensed). Separately, Accel (licensed) contracted with the same establishments.
- Plaintiffs J&J Ventures and Action Gaming sued in circuit court for declaratory relief asserting their assigned location agreements gave J&J exclusive rights to operate terminals; circuit courts found the agreements valid and enjoined Accel.
- The appellate court raised, and then held, that circuit courts lacked subject-matter jurisdiction because the Board has exclusive authority over contracts that govern placement and operation of video gaming terminals; it vacated the circuit-court judgments.
- The Illinois Supreme Court granted review, consolidated the appeals, allowed the Board to intervene, and affirmed the appellate court: the Board has exclusive, original jurisdiction to determine validity and enforceability of agreements that purport to control placement/operation of video gaming terminals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether circuit courts have subject-matter jurisdiction to adjudicate validity/enforceability of location/use agreements for video gaming terminals | Circuit courts retain jurisdiction; the Act did not explicitly divest them; agreements are precursor contracts outside Board authority | The Gaming Board has exclusive jurisdiction under the comprehensive Video Gaming Act and its regulations | Held: Board has exclusive original jurisdiction; circuit courts lack subject-matter jurisdiction |
| Whether the contested agreements are "use agreements" (thus governed by Board rules) or mere precursor/prelicensure contracts | Agreements are precursor and freely assignable prior to licensure, so not within Board regulation | Agreements govern placement/operation, require licensure and Board review/consent, so fall within Board authority | Held: Agreements are not merely preliminary; their terms, contingencies, and subject-to-Board-approval language place them within Board jurisdiction |
| Whether assignments by unlicensed operators to licensed operators are valid under Board regulations | Plaintiffs relied on Triple 7 holding that restrictions on assignment apply only to licensed use agreements, so their assignments valid | Board/Accel argued assignments implicate statutory scheme and regulatory licensing/approval requirements | Held: Court did not reach merits because jurisdiction rests with Board; validity of assignments belongs to Board adjudication |
| Whether plaintiffs’ constitutional claims (contract clause, jury trial) could be decided by courts here | Plaintiffs argued loss of contract rights and jury trial if courts divested | Board argued adjudication belongs to administrative process; constitutional claims need not overcome statutory scheme | Held: Court declined to address constitutional claims as Board has exclusive jurisdiction; merits unnecessary |
Key Cases Cited
- Employers Mutual Cos. v. Skilling, 163 Ill. 2d 284 (1994) (discusses when legislature must explicitly divest circuit court jurisdiction)
- People v. NL Industries, 152 Ill. 2d 82 (1992) (statutory scheme must be read as a whole to discern intent to divest jurisdiction)
- Crossroads Ford Truck Sales, Inc. v. Sterling Truck Corp., 2011 IL 111611 (2011) (analysis of subject-matter jurisdiction and administrative exclusivity)
- Ferris, Thompson & Zweig, Ltd. v. Esposito, 2015 IL 117443 (2015) (statutory interpretation in determining allocation of jurisdiction between courts and agencies)