Case Information

*1 -E ATTOICATEY GENERMC. '. ,, OIF TEXAS.: AUS+IN~ TEXAS~ April 13, 1948 .' Hoti. Lloyd King Opinion No. V-544.

District Attorney

47th ~Judicial District Re: The legality of the contest type theater Amarillo, Texas

attendance stimulator plan known as "Bank of Knowledge".

De& Sirs:'

Your letter of January 12 encloses data des- criptive of a plan t.o distribute priaes,by question and answer contests, The plan is denominated "Bank of Know- ledge". The general scheme of the plan is outlined and sample questions and answers used in a motion picture theater at Childress, Texas, are enclosed. You state: ,

"The operation of the plan is self- evident from the attached instruments and exhibits, and appears to be a question and 'answer program similar to the Dr. I.Q. program except that the entire audience participates and there is only one award given rather' than .several awards. There is no selection by chance or by lot or by any type of device as to who may partici- pate in answering the five questions. Any- one in the theater may win the award." Your particular question is: "Does-the ope,ration of the'.Bank of Knovjledge constitute,a lottery under the laws of the State of Texas?" The plan purports to operate essentially as follows:

A substantial cash prize is posted by the the- ater and all in attendance at the theater may participate in the contest to win the prize'. If no prize winner is selected, the prize for the subsequent contest is in- creased. Regional and~national contests are contemplated *2 I 398

Hon. Lloyd King, Page 2, v-544.

but a description of them is not contained in your lettel or the data submitted. At the local contest, up to five questions are asked from the stage. Following each ques- tion, a number of answers are read from the stage and eat answer is given a letter designation. The contestants hold a card upon which appears a number of letters corre: ponding to the various answers to each question. Bach cc testant is to punch the letter which he bdieves corres- ponds to the correct answer to each question. After the contestants have punched answers to all five questions, the correct answer to the first question is announced, al those answering the first question correctly are to stanc the remainder to remain seated. The answer to the seconc question is then announced and those missing it are to bc seated. This process is continued until all are seated after the announcement of the answer of the fifth questic or if one remains standing he wins. If more than one is standing, some additional questions are asked and the prc cess of elimination continues until a winner is. chosen. If, however, no one answers the first five questions cor- rectly, no winner for that contest is chosen. 13 is on11 in the event that more than one complete the first five questions correctly that the process of elimination is continued until a single winner is chosen.

The first five questions used in the perform- ance ref.erred to are as follows:

QUESTION NUMBER ONE: Designate then President of the United States that organized the."Rough Riders". Was it: (A, Stonewall Jackson) L (B John Quincy Adams) - (C, Theodore Roosevelt) - (D,~Wiiliam Howard Taft) - (E, Woodrow Wilson) - (F, Ulysses S. Grant)?

QUESTION NUMBER TWO: In what year did Babe Ruth hit

home runs? Was it: (A, 1921) - (B 1923).- (c, - (D, 1927) - (E, 1929) or @, 1931b 3) QUESTION NUMBER THREE: 'A method of what is called the bertl -1lon system? Is it: (A, shorthand) - (B,,crimi- nal identification) - (Ci transportation ) - (D, blind reading) '- (E,~ horse racing ) or (F; yachting)?

QUESTION NUMBER FOUR: About how many persons had crossec the ocean by air before,Lindberg,made his solo fli ht? Was it: (A, none) - (B, 4) - (C, 24) - (D, 42) - 7 E,64) ox- (F, 104)?

399 ,; Hon. Lloyd King, Page 3, V-544.

QUESTION; NUMBER FIVE: Th,e'lstter R.with:a~, line drawn through the tail,at the~top of a, doctorls~.pres.cr$pt$en "{blank means: (A, prepare) - .(B, mix well),:-;.l(!:,::atten-

tion) - (D, I prescribe) - (E;keep cool) or .(F,~recipe)?

Questions for elimination in.the; event of a tie; t;';at is; in the event more than one. personan~swers .a11 five of~the,foregoing questions correctly, are: : Who was bid' Hickory? Answer.., - $;;kzn.. ‘#ho ~invented,the.steam boat? * 1,

-Nhat.isswiss~ chard: :., : A'vegeiable.

Article'~ 65.4 'of the.Penal Codes prohibits. the establ~i&m+nt of a'loitery. The statute'contains no :.defin&ion of a lottery but + this connection 2g Tex,

J@fh.409; 410 contains the foll,owi,ng statement:

"The term lottery has no. technical . . ..e&&fication in the law, and s,ince 'our statute does'~not prov'ide .a.definition, _ ..its meaning must be~determined from popu- .le,r usage. According to that test a lot- tery isa. scheme for the distribution of prize,s by lot .or chance among those who ,...:' ,ha,ve.paid or,.agreed to pay a consideration for the,right to participate therein,~.or :the distribution itself." -In,order to,constitute a lottery it is ..gen- erally considered that three elements must'be resent. They,are:, .(l) consideration;~ (2) prize; Andy P 3) chance. 34 Am. Jur. 647,:648., The main question involved here is whether or not the element of chance'exists in such a degree as to make the plan illegal, it being conceded that consideration land prize are, present.'

Two former opinions of this office.are perti- nent to 'your inquiry?, both'of ,tiich ,are attached hereto for reference. Opinion No. V-238 involved a plan known as "bonanza" It was there considered that if the ele-. ment of .chanie predominated over,the element of skill, the other elements being present, the scheme was a lot- tery. "Bonanzafl involved the distribution of tickets on the.,back.cof each of which was printed a question. Eac~h ticket was numbered. A d,rawing was conducted and those holding lucky numbers.were offered an opportunity to answer t~he, question onthe back of their ticket. If the question ,was answered, correctly, the lucky,person *4 Hon. Lloyd King, Page 4, V-544.

mightthen answer one or more of ten additional ques- tions, and for each correct answer a prize was given.

It was there held that chance predominated over skill and.the plan was held to be illegal.

In Opinion No. O-1789, this department passed

upon the legality of a theater program known as "Dr.

I. Q.". The "Dr. I. Q." ~ogram was conducted by select- ing from the audience a number of persons, each of whom was asked a series of questions similar, to those above set out, and prizes were offered to each person indivi- dually dependent upon his correct answers to such ques- tions. In the "Dr. I. Q.v program, there was no contest between the various members of the audience. There was nothing to indicate that participants were selected by a drawing. On the authority of Boatwright v. State,118 Tex. Cr. R. 381, 38 S. W. (2d) 87;hereafter discussed; McRae v. State, 46 Tkx. Cr. R. 489, 81 S. W. 741; and Hoff V. Daily Graphic, 230 N.Y.S. 360, 103 A.L.R. 870, dealing with the question of skill v.,chance, it was determined that the "Dr. I. Q." program did not violate the lottery81aws of this State. In Boatwright v:State, supra, the Appellant

2 was convicted of operating a lottery. He had exhibited a punchboard from which might be punched a checker prob- lem, the solution of which would require skill in check- er playing. The exhibitor held the key to the better solutions and customers were allowed to take the problems home and work them out, presenting his solution to the exhibitor of the board who, if the solution was the best, awarded a prize. -The exhibitormight require under that schenie.not only the best solutioti~~but the quickest and the neatest. The Court in that case said:

RIt is observed that the success of t~he player in the game under consideration depends upon practice, experience or skill. Other than the ordinary chance or contin- gency which isinvolved in practically every human endeavor, the element of chance is not present. The priae is drawn as a re- ward for the skill of the player,' and not by chance. The predominant element in the game"is one of skill. There is no more re- semblance to a' lottery in the game than there is in the operation of the knife rack described~in McRae v. State, 46 Tex. Cr. R. 489,. 81 S. W. 741.~ In' that case, in holding *5 . ," ,"

Hon. Lloyd King, Page 5, V-5&. the, game.not within the .inhibition ~of the,,.stat- ute .denouncing lotteriesi Judge Davidsonsaid:. .~

GcThe'evidence .discloses that it was an ordinary knife rack, whichconsisted 'of a'.slop- ing:board and arranged so that rings could be . ..thro~ and lodged upon.the ,kriives; and when the

player +@s fortunate enough to~~throw one.of ,:.these..r&ngs, around .a knife, or catch its on a . ~. .~.kni.fe;~:'the ,knife becamehis ,property. . ,.'... .A

lottery is commonly understood as. a, ,"scheme for the.distribution of prfzes by lot or chance, es- pecially a.gaming scheme in which,one or more . ..tickets' bearing particular numbersdraw prizes " , '~ and.the rest.of.the tickets are blank."...There ,' ,. were notickets distributed'under the scheme,,,

;-...as.:shown in'the testimony'but rings were sold, .:'. andthethrower of the.rings took chances as tc ,/‘:'~whethe'r‘he could incloseoae of the knives by

.,I.. one..pf.the rings..& thrown, and.the..succesa' of', .;:.,the pitche'rdepended upon hfs .practije, ~exper-

ience, or skill. :Je do not believe-it was-la lottery.'", .:;.~,Y .I : ~.

; :..:. ,,::,. :The.Court then cites'a number of caseswhich -:had passed~ upon, the.~identicalchecker~ game punchboard. ,.~The~:Court.then quotes from Johnson V. McDonald?-132 Ore.

622:..-.287. Pat,.: 220, 221; as- follows: ,~ US.' .~ .~,

i :.;'~~Itwill be seen from the directionsthat the prize is'drawn, not by chance, 'but as a'red' ward. fcr the .skill.of the'person claiming the .' prize, If there is any’c+demhnt of ,chance at all about the device,'it is in the.drawing'of the problem: Any woblem drawn requires the solutionof th.e game'of'checkers'pre8ented by that particular problem.,' From the directions.

given with the Advertoshare. problem checker&, boards:we~:.learn that the problem is the cample- tion-of..a .game .of checkers thathas beenpart- iallyjplayed. The device was,invented by a fa- mous checker player. So far as it ishumanly possible,'the seve~ral.problems are of equal dif- ficulty. No distr~i~bution of prizes is made by chance'or lot.~ Gambling'does. nothave'any place in the:game as itis intended to be played~. The

rizesoffered are trivial, and'do not offer any .$nducement for one to.purchase an oppartunlty to play the game.

Hon. Lloyd King, Page 6,. V-544.

"There is no more resemblance to a lot.- tery in the scheme than there is in a game. of billiards or of cards where such games are played in a public place and charges are made for the privilege of using the billiard tables or card tables. The predominantele- ment in the game is one of skill.

would not appeal to my one who did not 1 e =-y% to play checkers. There is-no apparent .llke- ‘Iihood at all that the game, if played as designed. would cultivate a spirit of gambi- w (Emphasis supplied) The conviction was reversed because the game was held to be one of skill and not of chance.

In Hoff v. Daily Graphic, 230 N.Y.S.. 360, ref- ferredto above, the contest involved the selection of play titles, appropriate to drawings published $n the news papers and it was held that though,the solution involved chance to some extent, it was pretiminately'a contest of judgment and taste.

In Rouse v. Sisson, 199 So. 777, 132 A. L. R.

998, by the Supreme Court of Mississippi.ln 1941, the Court considered a mechanical device which flashed a ques- tion upon a screen upon the deposit of a nickel into the machine. The machine then exhibited a number of alter- nate questions and the player was given a~number;of see-. onds in which to punch a key corresponding to what he thought was the correct answer. A prise~was awarded if he punched the correct. key. Such a machine was held to be a game of skill rather than chance and was held to be legal.

Attempts'to exhaustively examine the nature of "chance".as .contemplated by the laws of this country sup- ressing lotteries could easily lead us into, an obscure discussion throwing more shadow than light upon.the prob- lem. The better approach is to ~look at the scheme as a whole;:its purpose and the natural tendencies of those who conduct it and participate therein.

We quote from 34 Am. Juris., page 656: "It has been said that no sooner is the term *lottery'.defined by a court, than ingen- uity evolves some scheme within the mischief discussed;although not quite within.the let- ter of the definition given; but an examina- tion of the many cases on the subject will show *7 Hon. Lloyd King, Page 7$ V-544. .~:

that it his very difficult,.if not im

sible, for the most ingenious and-su tie..~.-;' f?- "' minds to, devise.. 'any scheme o'r plan,, short .: of a~ ,gratuitoua, distri~bution of prope.rty;~ '. .~ which hasnot.bean.held by the'courts of'

this country to, be in vio.lation. o.fthe: lotr~~ tery laws in .force in the,various:states of- the: Uuion.. ;Ihe court will inquire,,not .in-.

tb'th&name, but into the..ganu?$ however skil- fully'disg;u'ised, in order to ascertain if

it' is'prohibited,,or if it has' the ~eiement~ of'chinde..T1- :(Emphasis supplied)

:From 3~4: Am.. .Juris! 9 page 647; wee quote:. .~ ~. Where,the term ~(lotteryl is. not, de- ,,. ! 'finedby. statute.directed against.-itjit

.hae,.beenstated that. a definition which ,in- ,' eludes as an elementthe evil.which the- stat- ute was. intend.ed to prevent must be adopted.." ,.-* >,. ..i -@aphasis supplied) :' ; .__ '_I_ .". .,

I From the leading c&eof"State v.~ Glob&Democrat Publishing1 Company,, 341: MO.., 862, 110, 3.. W. ,(2d) 705, 113 A&R,.?: 1104; ye quote: ._ ,= _,:.‘I : .I I, ,:.Y "It ,is impossible- to harmonize ,a11

/ ;’ ~‘-,‘. the~cases. But we draw~.the~.conclusion ~~ .,.

.,..from them thatwhere:a contest is mult-

iple:.,or .serial,.,and:requires the.solution of:a number of problems to win the, priie; : the..fact.that skill alone will'bring con-. :

testsnts to a: ;correct~ solution~'ofa great- ,er part of the'problems doesnot make.tlie ~cont8st.eny~th8 less a lottery ifchance'

enters. into the solution of'another.lesser.~ '~ part of the'problems, and thereby~.proxim8te-~ ~.ly -influences the ~final result. : Inother :

.words,,the rule t&t chance,mustbe the .dond: ,~ ~n&.factor is,Yto~,be.taken in a qualitative

ore causative sense rather than a quantitative sense. This was directly decided in Co1e.s v::Odhams Pre,ss,,Ltd.:, supra, when it ~w8.s held the question was not.to be determined .onthe basis of.the'mere proportions of skill land chance.entering.,in th,e contestas 'a whole. . . _ '! .'.' o 'O,,In.the‘instant case,it stands. :

c.oncedei that at the beginning of ,the 'Fam- ous. Names' contest the cartoons were compara- tively simple and the list of suggested titles *8 ;r 2 40~,,, . Lloyd King, Page 8, v-544.

was short. This made the conte~st inviting to entrants. But towards the end the car- many as toons became more 'Subtle' and as

180 titles had to be considered.' It was a weeding out process, undoubtedly; and, if chance inhered in the solution of these lat: ter cartoons, though only a few of them,and eliminated a large number of contestants, then it must be said, the result was influenc- ed'by chance.

"Further, we are convinced the question whether the element of.chance was present must be viewed from the standpoint of the nearly 7O;OOO persons who entered the con- test in response to the advertising thereof; and that itis not to be measured bye any ab- sol.ute or technicsl standards.' As was said ..in Coles v.~Odhams Press, Ltd., supra, 'the

competitor is the person to be considered'.~ In the instant case the public was informed that any one might win; that no special skill, training or education was required; and that an opportunity was offered to gainsome 'easy money'. It is true reference to the possibil- ity ofchildren's winning was omitted from the later advertising. but aside from that hope was held out to <he general public.. That-be- ing true, whether chance or skill was the de- termining factor in the contest must depend upon the capacity of the general public--not experts--to solve the problems presented.- nTh8.respondent's thedry is that the in- terpretation of rebus puzeles.is a science; and that, since they can be solved by the ap- plication of these scientific principles, the elementof chance is absent. 'Some of the deci- sions lend support to that view, such as Hudel- son v:~State, supra,~Stevens v:Times-Star Co., supra, and Waite v. Press Publishing Asstn., supra. All of these cases conceded an expert might more nearly than a~nonexpert approach a solution of the problems they were considering, and then swept away that concession by saying that nevertheless there remained unfathomable elements in the problem which nobody could solve. This might be taken to mean that, if *9 - Hon. Lloyd King, Page 9, ,V-544. : '~

contest ~problems' can be solved-at.&11 chance is eliminated. And the fadvertosharei check.- er game‘cases seem-to partake of 'that theory, though:-there,is possibly~an allowable“di$tincY~ :. tion;there,

.~. '-ykut~ 'such is .not thb trtie general rule.. As.was -said,in,PeopIi ex.rel; El'lison v. Lavin, supra,:if a"contest W8r.e solaly b.etween expe,rts, possibly elements affecting'the result which no one could fores'ee might.:&e held dependent upon . . judgmenV,'but.not so whenthe contest' is unres-~ trictedi' '&at 'is -a ,matter .of.chance for one' ; man'may"not' be -for another: And as Mr. Justice

Holmes said in Dillinghan v.,'McL&ghlin, 264 U:X:370,~ -373, 44 S:Ct.. 362;363, 68.L. Ed.

742, .r,what Amman does'not- knoti,,apd cannotfind out ischance as.'to~ him,~ arid is recogn$&i as .chance'.by, the lati.~,l- +~' Obviously,,,if some'ab-'~ stl'~ce.pr~bl,em~co~~arable'~'~ttd'~t~he.~~~~st~in the-, ory weresubmitted to the general'.public in ,a ,.prize.,conte.st on 'the r'epresentation that 'no spe~cialtraining or education would be requir- ,edto 'solve~.it;,"the': contention 'could not 'be made; after contestants 'had been 'induced to part ~Gith:'their entrance monejr,, that-:~the ele- ment'of Wiance~'was.'absent 'bectiuse'there were a ,f,ey persons ~,in the tirld-tiho pdssessed.the .le~r~~~g,necessa~'to unde~rstand, it,. .*~. (Em- phasis~ supplied]. '. ~. 1.;'.

.From,the authorities cited~, it is ahparent that the manner in which the questions are presented and the'nature of such questions willcontrol as fact issues ineach. contest as to'whkther the contest or any controlling 'poH5o.nof .it' is. redu'ced t'o 'mere guess or chance. '~ It is impossible for us to say that in all conte.stsunder the: Vank ,of"Kno'wledge" plan'inere chance and.guesswill~.be dominantand therefore illegal, or that:.skill'and knowledge will be dominant'sndtherefore legal.,.,:. _': ','_ .-, " . . .- .~; ,-,

* :The par%icular questions submitted with your repuest:as:the ones to:be used in the first performance appea~r to.':present a contest based primarilyupon skill and knotiledge rather than upon chance. If all the con- tests or performances' are based upon similar questions and are..conducted in a manner so that skill an'd know- ledge control rather than mere guesses, these contests or performances would be lawful.

406

Hon. Lloyd King, Page 10, F-544.

On the other hand, it is entirely possible for "Dank of Knowledge" questions to be so worded that one or more of them rest wholly upon pure guesses in so far as practically all of the' participants are con- cerned. In such case the scheme may fall within the class condemned by such cases as Stevens v. Times-Star co., 73 N. E. 1058, wherein the contest involved an estimate of the number of votes to be cast for Secre- tary of State of Ohio in a particular election; People v; Lavin, '71 N. E. 753, wherein the contest involved an estimate of the amount ,of tax to be paid the United States Government upon cigars- or White v. Press Pub- lishing Association, 155 F. 5$, another contest involv- ing an estimate of the votes to be cast in a president- vial election.

The letter opinion on this subject by Frank J. Delaney, Solicitor of the Post Office Department, February 6, 1948, recognizes. that the circumstances of each separate contest or performance are controlling.

After outlining~the procedure to be followed in the first performance, the Solicitor says:

~*When conducted in.accordance with the above dutline, and employing *8S-

tions of such a nature as not to require the contestants to guess at their car'-

rect answers, matter relating to this

plan would appear to be acceptable for mailing insofar as Section 601, Post&l Laws and Regulations of 1940, is concern- ed.".

Obviously we cannot anticipate the type of questions which wili be used ,in subsequent programs.

Therefore, we cannot categorically stat8 that the "Dank of Knowledge" plan is as a matter of law a lottery or not a lottery. The question of whether chance predomi- nates over skill cannot be determined abstractly, but depends on the circumstances of each separate contest operated under the plan. The plan.can be operated so as not to violate the law. Likewise, it can be oper- ated in such a manner as to be unlawful. Each contest thereunder will present a separate fact situation which cannot be prejudged as a matterof law.

SUMMARY Whether the theater'question contest plan knckvn as "Bank of ,Knowledge" is.a lot- tery and violates Art. 654, V, P. C.,, is *11 -

Hon. Lloyd King, Page 11, V-544:

a question to be determined upon the facts and ,circumstances of each contest and can- not be.determined abstractly as a matter oft law.. If conduct of the contest and the an- swers to a given set of questions are depend- ent primarily upon skill and knowledge rather than upon mere chance, the contest 1,s lawful. On the other hand, if any controlling portion oft a contest calls for'and is' dependent upon' pure guesses or chance, it is a lottery and is therefore unlawful.

Yours very truly ATTORNEY GENERAL OF TEXAS Assistant