Kroger Co. v. Cook

*42 Duffey, P. J. This is an appeal on questions of law from a judgment of the Common Pleas Court of Franklin County declaring that certain promotional programs of appellant, The Kroger Co., are in violation of Regulation 53 of the Liquor Control Commission, and of Section 6, Article XV, Constitution of Ohio, and of Section 2915.01 et scq., Revised Code. Appellant, The Kroger Co., has engaged in a business promotion called “Race to Riches.” In essence, appellant distributes cards bearing numbers which correspond to the numbers upon various automobile racing cars. Each week a film is televised showing the cars engaging in a race. If the card contains the number of the winning car or sequence of such numbers, a prize is awarded to the cardholder. Only a few of the numbers on the cards are winning numbers and these are distributed randomly. The opportunity to obtain a card containing a winning number is therefore a matter of chance. A card may be obtained as follows: 1. Any person passing through a “check-out” line at one of appellant’s stores is offered one regardless of whether the person has or is purchasing any merchandise. Some nonpurchasers do pass through the check-out lines. 2. Any person who enters the store and requests a card is furnished one without regard to a purchase and although remaining in the vestibule without entering the merchandise display area. 3. Any person who requests a card at the store manager’s office. 4. Any person who requests by mail or telephone. The Attorney General contends, and the Common Pleas Court agreed, that the promotion constituted a lottery under Section 6, Article XV, Constitution of Ohio, that it was gambling within the provisions of Ohio gambling statutes (Section 2915.01 et seq., Revised Code), and that it was a violation of Regulation 53 of the Liquor Control Commission. Section 6, Article XV, Constitution of Ohio, provides: “Lotteries, and the sale of lottery tickets for any purpose whatever, shall forever be prohibited in this state.” *43 In my opinion, the promotional program here is not a lottery within the meaning of that constitutional provision. While there may be a chance, and a prize, there is no “price” charged. The promotion does involve costs to the promoter, but the cost of this or any other advertising promotion cannot be transformed into a quid pro quo. Cost does not create a sale transaction nor constitute a bargain for consideration. Customers may be intrigued by the opportunity for a prize and either patronize appellant’s stores or purchase more items or otherwise respond to the lure of the promotion. However, the fact that certain consumer behavior patterns are anticipated as a matter of predictable response to a set of circumstances and that the anticipated responses occur does not establish that the behavior of any individual was bargained for by the promoter. The promotion here is, from a legal viewpoint, simply the gift of a chance for a prize. It is legally identical in its essentials to the “sweepstake” promotion so widely engaged in by major newspapers, consumer goods manufacturers and merchandising enterprises. It is also legally identical to the drawings for door prizes which frequently are held at meetings ranging from the Ladies Aid Society to the Republican War Veterans Picnic. In holding that the promotion here is not a lottery, it should be firmly understood that I am not expressing any view on the desirability of such methods of advertising and promoting. Neither am I expressing any opinion on the constitutional, statutory or regulatory power to control or prohibit such schemes. For the reasons stated, I believe that the promotion here is not in violation of the gambling laws in Section 2915.01 et seq., Revised Code. I cannot agree with the concurring opinion’s suggestion that the phrase “scheme of chance” as used in Section 2915.12, Revised Code, and other sections in that chapter, is different and broader than lottery or gambling. The phrase is used repeatedly throughout Chapter 2915, Revised Code. In my opinion, the phrase is used, together with several others; in an attempt to describe comprehensively any kind of transaction the essential elements of *44 which include a price, a chance and a prize. I believe it is for that reason that the General Assembly said “lottery or scheme of chance, by whatever name known.” (Section 2915.12, Revised Code.) (Emphasis added.) Appellee contends that the promotion is a violation of Regulation 53 of the Liquor Control Commission. Section II of that regulation provides: “No person authorized to sell alcoholic beverages shall have, harbor, keep, exhibit, possess or employ or allow to be kept, exhibited or used in, upon or about the premises of the permit holder any device, machine, apparatus, book, records, forms, tickets, papers or charts which may or can be used for gaming or wagering or the recording of wagers, pools or chances on the result of any contest, or allow or conduct gaming or wagering on such premises on (of) any game of skill or chance. “Effective July 5,1950. Incorporates former Reg. 32, effective after September 5, 1935, and amends the same.” Broken down into its components, the regulation: (1) Prohibits a permit holder having anything which can be used for (a) gaming, (b) wagering, (c) the recording of wagers, (d) the recording of pools, (e) the recording of chances on the result of any contest. (2) Prohibits a permit holder from allowing or conducting (a) gaming or wagering on a game of skill, (b) gaming or wagering on a game of chance. For the reasons expressed, the promotion here cannot be classified as wagering, wagers or pools. The concurring opinion concludes that the gift of a chance to win a prize constitutes “gaming” and a “game of chance.” I cannot agree. The context of the regulation shows otherwise. I also point out that the last clause of the regulation does not prohibit allowing or conducting a game of chance. It prohibits allowing “gaming or wagering * * * on any game of skill or chance.” (Emphasis added.) Clearly, the regulation was not intended to prohibit thé sale of beer on *45 premises used for games of skill such, as professional football and baseball in Cleveland, Cincinnati and other cities, or at professional basketball events. It is equally clear, therefore, that the same clause does not prohibit conducting games of chance, unless there is wagering or gaming on that game. The Attorney General argues that the regulation covers the gift of chances to win a prize by the phrase “chances on the result of any contest.” However, careful reading of the regulation in its complete context shows that phrase does not broaden the regulation. It prohibits having anything “which can he used for gaming or wagering or the recording of wagers, pools or chances on the result of any contest.” To prohibit the gift of a chance involves practices commonly carried on under almost infinite circumstances, many of which are quite innocuous, although some are quite undesirable. It should be noted that in any grocery store there are dozens of products on which the manufacturer offers a chance for a prize. The device is also comm only used by major newspapers to promote circulation, automobile manufacturers, and, as previously noted, groups ranging from the local church sodality to political meetings. “Permit premises” range from private parks used for picnics by groups with 24-hour special event permits to arenas such as the Cleveland Municipal Stadium. It is important in our American system that courts not, under the guise of judicial interpretation, establish policy that can and should be covered by statutory provisions or the adoption of a regulation. The plain fact is that a promotion such as “Race to Riches” is premium or gift merchandising, and not gambling or a lottery or the recording of chances on the result of a contest. Gift merchandising is covered by another regulation. Regulation 45 of the Liquor Control Commission provides: “Premium or gift merchandising in connection with the solicitation, advertising or sale of alcoholic beverages is prohibited. “Effective July 5, 1950.” *46 While counsel for the department did not brief or argue the application of this regulation, I think it clearly applies to appellant’s promotion on the facts of record in this case. The promotion here is not limited to the sale of food products such as the “sweepstakes” being conducted by manufacturers of products sold in Kroger stores. It is conducted by Kroger itself to increase the sale of all products in the stores. Kroger’s products offered for sale include (in these stores) alcoholic beverages. Therefore, the promotion involves the gift of something of value (a chance to win a prize) in connection with the advertising and sale of alcoholic beverages. On the basis of Regulation 45, and solely on that ground, I would affirm the judgment of the Common Pleas Court. The judgment of the Common Pleas Court will be affirmed. Judgment affirmed. Troop, J., concurs separately, but not in paragraph one of the syllabus. Herbert, J., concurs separately.