Case 7:10-cv-02067-SLB Document 12-3

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FILED
2010 Aug-16 AM 09:49 U.S. DISTRICT COURT N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ALABAMA WESTERN DIVISION

WILLIAM JOHNSON, ANNIE PEARL LEFTWICH, BOBBI MORGAN, DONALD MEANS, ERNEST EDMONDS, FAIRY GORDON, IRIS SERMON, JOHNNY BUTLER, MERJEAN LITTLE, MOSES JONES, VASSIE BROWN, WILLIE MAE REEVES, BEVERLY GORDON, JOHNNY B. MORROW, FANNIE ISHMAN, LESLIE CHEATEM, MARGIE JAMES, BOBBY SINGLETON, A. J. MCCAMBELL, JOHNNY FORD, LOUIS MAXWELL, MARY RUTH WOODS, LISA M. WARE, CLARA P. GRIMMETT, CHARLES CHAMBLISS, JOHNNIE B. HARRISON, G. DYANN ROBINSON, SHIRLEY W. CURRY, SARAH STRINGER, MILES D. ROBINSON, and WILLIE LEE PATTERSON, individually and on behalf of others similarly situated, Plaintiffs, v. BOB RILEY, in his individual capacity and in his official capacity as Governor of Alabama, and JOHN M. TYSON, JR., individually and in his official capacity as special prosecutor and task force commander of the Governor’s Task Force on Illegal Gaming, Defendants.

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Civil Action No. 7:10-cv-02067-SLB

Three-judge court requested

EXHIBIT C TO PLAINTIFFS’ AMENDED MOTION FOR PRELIMINARY INJUNCTION

State of Alabama - Office of the Governor Bob Riley - Press Releases

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Office of the Governor

BOB RILEY
Governor Press Office

STATE OF ALABAMA

February 07, 2006

Governor Riley and Attorney General King Propose End to Gambling loopholes

Dan lrela the Alabama Citizens Action Program speaks in favor of legislation being proposed by Attorney Troy King and Governor Bob Riley, who listen to his remarks. Photo credit: Robin Cooper, Governor's Office.

General

~Listen to the Governor's

Comments

MONTGOMERY - At a news conference at the State Capitol Tuesday morning, Governor Bob Riley and Attorney General Troy King announced proposed legislation designed to take the profit out of illegal gambling, to close the legal loopholes that allow gambling facilities to operate a sweepstakes, to end electronic bingo, and to comprehensively overhaul and tighten constitutional provisions regarding lotteries and bingo in Alabama. "We're asking the Legislature to close the loopholes, end the shams and stop illegal gambling in Alabama once and for ali," Governor Riley said. "Our proposals are

http://www.governorpress.alabama.gov/pr/pr-2006-02-07-0

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State of Alabama - Office ofthe Governor Bob Riley - Press Releases

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comprehensive, ironclad and put teeth in our gambling laws." "We are here today because we have a problem in Alabama-a problem with gambling," said Attorney General King. "Gambling is expressly prohibited by our Constitution and every time its expansion has been brought before all the voters of Alabama, they have overwhelmingly rejected it. As technology has made our lives easier and better in many respects, in the area of gambling it has outpaced our laws and opened loopholes that allow activities that look like illegal casino style gambling, that sound like illegal casino style gambling, but that can be carefully crafted and manipulated to fit into loopholes under current law." An essential component of the legislative package is Civil Recovery for Illegal Gambling Activity, a bill that sets high civil penalties to strip the profits from those who own, operate, possess, lease, or have an indirect or direct financial interest in the operation of, a gambling device. "Owners and operators of gambling facilities, and other individuals who profit from this illegal activity, have considered the payment of criminal fines as a general cost of engaging in these illegal businesses," the legislation states. Attorney General King notes that, under current law, an illegal gambling operation can recover the cost of fines it may face with the profits from just three days of operation. The new law would make the potential cost of illegal gambling so high that the profits are simply no longer worth the risk. First-time offenders would face fines for an individual or entity of at least $1,000 for each day a gambling device is in use, and for each gambling device; or up to three times the gross receipts derived from the gambling device, whichever is greater. In addition, all profits must be forfeited, as well as any property, real or otherwise, used in connection with the gambling device. Upon a second violation, an individual or entity faces a minimum fine of $25,000 penalty per day, per gambling device, which could go as high as $100,000 for each day and each gambling device. It is expressly stated that these civil penalties are not intended to replace existing civil and criminal penalties, but to be used in conjunction with them. The Civil Recovery bill further provides potential awards to whistleblowers of up to 15 percent of the penalties imposed. If someone comes forward with non-public and original information that leads to a successful collection of fines and assets under this act, the whistle blower may petition the court to award him or her up to 15 percent of the total amount recovered. The remainder, after the court costs and other costs, may be split evenly between the investigating agency and the prosecuting agency" "This bill will severely and punitively punish those who operate illegally just where it hurts the most-and where it will matter the most to outlaw gamblers--in their pocketbooks," said Attorney General King. Governor Riley and Attorney General King also propose a comprehensive set of amendments to Section 65 of the Constitution of Alabama, which currently prohibits lotteries and would be expanded to include any other games of chance. A game of chance would be defined as one where the player has the ability to win a prize upon payment of a consideration, with the outcome determined in a material degree by chance. This serves to resolve the debate that has raged under current law regarding the degrees to which skill and chance may be involved in the outcome. The new amendment further places some restrictions on already existing amendments that authorize bingo in certain counties, limiting these operations to only religious, charitable, educational, fraternal, or benevolent nonprofit organizations which qualify as

http://www.governorpress.alabama.gov/pr/pr-2006-02-07-0

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State of Alabama - Office of the Governor Bob Riley - Press Releases

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an exempt organization under Section 501 (c) of the Internal Revenue Code, and shall be operated exclusively for religious, charitable, educational, fraternal, or benevolent purposes. It bans the use of electronic devices in playing bingo under existing local amendments, limiting the games that are authorized to traditional paper bingo. Any future amendments to authorize any gambling in Alabama would require a statewide vote and not just a local vote by the county involved. This amendment also defines an illegal sweepstakes in a manner that addresses a recent situation where the appearance of casino-style gambling was allowed at a Birmingham race track through a loophole in the law regarding sweepstakes. "The current state of the law has a loophole to allow sweepstakes that are really shams to masquerade as legal operations," said Attorney General King. "We propose legislation that will prevent operators from running these sweepstakes in our state." The bill provides that a sweepstakes may not legally be conducted by an entity that is engaged in the business of gambling, or if the payout of all sweepstakes conducted by the entity over one year exceeds one percent of its gross receipts or one percent of its gross expenses. "The Governor and I are committed to passing and supporting these bills and to putting teeth in our gambling laws," said Attorney General King. "These bills provide comprehensive, swift, and long overdue reform. We encourage all Alabamians to call or write their state legislative delegation and ask them to support these bills and do all they can to ensure their passage."

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