Leevin Taitano Camacho, Attorney General of Guam v. Dafne M. Shimizu, Director, Guam Department of Revenue and Taxation, Lourdes A. Leon Guerrero, Governor of Guam, Atlas Amusement Enterprises, Inc., Darryl R. Styles d/b/a D&D Games, Guam Music, Inc., and DOES 1-10
2021 Guam 22
| Guam | 2021Background:
- In 2001 the Guam Legislature enacted P.L. 26-052:4 directing the Department of Revenue and Taxation (DRT) to promulgate “necessary rules and regulations” to regulate gaming activities authorized as of Aug. 1, 2001; DRT adopted gaming regulations codified at 3 GAR § 7114(a)(5) allowing electronic gaming device licenses.
- DRT did not follow Guam’s Administrative Adjudication Law (AAL) rulemaking procedures (no newspaper notice, no public hearing, no economic impact statement).
- The Office of the Attorney General (OAG) advised the devices were illegal; litigation ensued and OAG sued seeking declarations that the regulations and licenses were void.
- The Superior Court granted summary judgment for the OAG, declaring the gaming regulations and licenses void for failure to comply with the AAL; Guam Music, Inc. appealed.
- The Supreme Court of Guam affirmed: it held the Legislature’s delegation to DRT was constitutional, but DRT’s regulations were void because they were not promulgated under the AAL and were not ratified by later statutes.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether P.L. 26-052:4 unconstitutionally delegated legislative power to DRT | The statute contains no standards and gives DRT unfettered discretion | The statute supplies an intelligible principle (regulate only activities authorized as of 8/1/2001; promulgate "necessary" rules) | Delegation is constitutional; intelligible principle and boundaries exist |
| Whether the AAL applies or P.L. 26-052:4’s "notwithstanding any other provision of law" clause exempted DRT | AAL applies; the notwithstanding clause does not override non-conflicting procedural statutes | The notwithstanding clause exempts DRT from other law including the AAL | Notwithstanding clauses only displace conflicting laws; AAL does not conflict and applies |
| Whether failure to follow the AAL rendered the gaming regulations void | OAG: noncompliance with AAL invalidates rules and licenses | Guam Music: regulations remain valid or were cured by later acts | DRT’s failure to comply with AAL procedures voided the regulations and licenses |
| Whether later legislation (P.L. 27-077 or P.L. 32-060) cured/ratified the defective regulations | OAG: later laws did not clearly and unequivocally ratify defective regulations | Guam Music: later statutes codified or validated the regulations | No ratification: P.L. 27-077 simply codified properly promulgated rules (these were not); P.L. 32-060 is ambiguous and does not clearly ratify |
Key Cases Cited
- Mistretta v. United States, 488 U.S. 361 (upholding broad congressional delegations and discussing intelligible principle)
- Whitman v. American Trucking Ass'ns, Inc., 531 U.S. 457 (describing limits of nondelegation and intelligible principle test)
- J.W. Hampton, Jr., & Co. v. United States, 276 U.S. 394 (articulating the intelligible principle standard)
- Lichter v. United States, 334 U.S. 742 (recognizing flexible standards for permissible delegations)
- Southern Cal. Gas Co. v. Pub. Utils. Comm’n, 695 P.2d 186 (legislature may cure/validate unlawful agency action by subsequent enactment)
- EEOC v. CBS, Inc., 743 F.2d 969 (ratifying legislation must clearly and unequivocally recognize and cure unauthorized prior acts)
- Miccosukee Tribe of Indians of Fla. v. U.S. Army Corps of Eng’rs, 619 F.3d 1289 (prefer interpretation that allows co-existence of statutes absent clear intent to the contrary)