BINGO PALACE AND JAMIE DIZNEY V. HENRY G. LACKEY, COMMISSIONER, KENTUCKY DEPARTMENT OF CHARITABLE GAMING
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MODIFIED : October 29, 2009
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2009-SC-000079-I
BINGO PALACE
and JAMIE DIZNEY
V.
MOVANTS
ON REVIEW FROM COURT OF APPEALS
CASE NO . 2008-CA-002380-I
FRANKLIN CIRCUIT COURT NO. 08-CI-02004
HENRY G. LACKEY (COMMISSIONER,
KENTUCKY DEPARTMENT OF CHARITABLE GAMING}
RESPONDENT
OPINION AND ORDER
DENYING CR 65.09 RELIEF
Before this Court is a request to review (pursuant to CR 65.09} a decision
of the Court of Appeals, which denied interlocutory relief (pursuant to
CR 65 .07) from an interlocutory order of the Franklin Circuit Court denying a
temporary injunction (pursuant to CR 65 .04), which would allow Bingo Palace
to continue operating while its appeal of a license nonrenewal was pending .
Seeing no extraordinary cause for such relief, the request is denied .
Bingo Palace (Palace Concessions, LLC) is a for-profit enterprise located
in Jefferson County, which has operated a licensed (FAC 0227) charitable
gaming facility since March of 2004 . In October of 2008, Bingo Palace filed its
annual renewal application. In November, the Department of Charitable
Gaming (the "Department") sent Bingo Palace a notice of intent to seek a
license revocation for alleged violations of three charitable gaming laws . I Bingo
Palace filed a notice
of
appeal, and the utter sat. In December of 2008, the
Department sent movants a notice that their renewal application was denied
for the. reasons given in the November notice . Before a revocation hearing was
scheduled, the annual license expired .
The movants filed a complaint and a request for a temporary injunction
in the Franklin Circuit Court to permit operation until the administrative
appeal was over. The circuit court conducted a hearing on December 17, 2008,
and, thereafter, denied the request. The circuit court, in denying the request,
ruled that the decision to review a gaming license is discretionary with the
respondents and that under Maupin v. Stansbury, 575 S .W.2d 695, 699
(Ky.App . 1978), the movants had not presented a substantial question or a
substantial probability of success on the merits at trial.
Movants' request for interlocutory relief in the Court of Appeals to require
the respondents to issue a temporary license pending the administrative appeal
was denied. In affirming the trial court's denial, the Court of Appeals relied on
1 The record before us does not reveal the nature of, or citation to, the gaming laws
allegedly violated .
Bobbie Preece Facility v . Com ., Dept . of Charitable Gaming, 71 S .W .3d 99, 103
(Ky.App . 2001), for the proposition that there is "no `fundamental right' to a
license to operate a charitable gaming facility." Id. (quoting Commonwealth v .
Louisville Atlantis Community/Adapt, Inc . , 971 S.W.2d 810, 817 (Ky.App.
1997)) . Therefore, the panel concluded that the issuance of a temporary
charitable gaming license was purely discretionary.
On appeal to this Court, movants contend the Court of Appeals erred 1n
holding that the annual renewal of a charitable gaming facility license is a
purely discretionary function. Movants argue that a renewal is a mandatory
ministerial act by statute and regulation, citing 820 KAR 1 :029, Section 1(5)
and KRS 238.565(4) . Hence, they maintain that a temporary license should
have been issued pending review of the renewal denial.
Maupin, 575 S .W .2d 695, provides the courts with guidance in dealing
with interlocutory relief in the nature of a preliminary injunction . In Maupin ,
the Court of Appeals stated: "Because the injunction is an extraordinary
remedy, sufficiency of the evidence below must be evaluated in light of both
substantive and equitable principles ." Id. at 697 . CR 65.04 authorizes the
granting of a temporary injunction (interlocutory relied if the movant's rights
are being violated and the movant will suffer immediate and irreparable injury
pending a final judgment, or if waiting would render the final judgment
meaningless. According to Maupin , "In order to show harm to his rights, a
party must first allege possible abrogation of a concrete personal right ." Id. at
698 (citing Morrow v. City of Louisville , 249 S .W.2d 721 (Ky. 1952)) .
"[D]oubtful cases should await trial of the merits." Id. (citing Oscar Ewing,
Inc . v . Melton, 309 S .W.2d 760 (Ky. 1958)) . And further, there must be "a clear
showing that these rights will be immediately impaired." Id.
In evaluating an alleged "right" of the movants, we first look to the
statutory scheme on "Charitable Gaming," KRS Chapter 238. KRS 238 .525
authorizes the issuance of annual, biennial, and even temporary gaming
licenses and renewals thereof. KRS 238 .535(8)(d) allows charitable
organizations to hold events off premises if the location is licensed .
KRS 238.540 contains the restrictions on the location for charitable gaming,
and KRS 238 .555 controls the charitable gaming facility license . 820 KAR
1 :029, Section 1(5) provides that when an application for a license or a renewal
is submitted, the Office of Charitable Gaming "shall issue a license if the
applicant has met the requirements for licensure . . . ." KRS 238 .560
authorizes the Office of Charitable Gaming to police the gaming operations and
facilities, and appeals of such administrative actions are governed by
KRS 238.565 . Section four of this appeal process provides for a stay of all
administrative orders until the appeal is final. KRS 238.565(4) .
Movants contend that the licensing scheme, including renewals and
appeal of denials, creates a mandatory ministerial act that is the equivalent of
a "right" to a renewal. The respondents rely on Bobbie Preece Facility ,
71 S.W .3d 99, which appears to be on point. In that case, a bingo hall owner
also challenged the denial of a renewal application for a license to operate a
charitable gaming establishment. In affirming the trial court's denial of said
license, the Court of Appeals noted that the operator of the hall "has no
`fundamental right' to a license to operate a charitable gaming facility[.]" Id. at
103 (quoting Louisville Atlantis, 971 S.W.2d at 817) . Also, the "license is more
akin to a privilege than a license ." Id. at 104 . While we agree the movants do
not have a properly right to a license, we conclude that the movants do have a
right to a renewal unless cause is shown that would have justified a revocation
or nonrene wal of the hcense . 3
In the case sub judice, movants applied for a license renewal at about
the same time as the Office of Charitable Gaming sought to revoke said license .
Because the license expired before it could be revoked, there was no harm to
the existing license . The renewal, however, was denied for the same unknown
three reasons listed in the revocation notice. Therefore, movants were entitled
to appeal the nonrenewal. Not knowing the reasons or evidence for the
nonrenewal, we cannot determine whether the public interest would be harmed
by the issuance of an injunction, whether a substantial question has been
presented, or if irreparable injury was shown . See Maupin , 575 S .W .2d at 69899 . In denying the injunction, we are not ruling on the outcome of the appeal,
2
The suit in Bobbie Preece Facility was for a "taking" without just compensation after
the renewal was denied. Id. at 101 . In the instant case, movants are seeking
renewal of the license .
3
820 KAR 1 :029, Section 1(5) (requiring that the Department "shall issue a license .
." if conditions are met) ; 820 KAR 1 :130, Section 4(1)(d) (a license renewal
application may be denied if "a license holder fails to fulfill any requirement,
qualification or eligibility restriction for licensure set forth in KRS Chapter 238 or
820 KAR Chapter l .")
but only instructing the parties to return to the administrative hearing below
for a final order before appealing through the courts.
For the foregoing reasons, this Court affirms the Court of Appeals' denial
of interlocutory relief, albeit for different reasons .
All sitting. All concur.
ENTERED : August 27, 2009.
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