well since everyone is flexing there legal minds... I'll join the flex fest

charity gaming laws are covered in diff set of statutes from gaming laws. they have very little do with each other

no. law has nothing to do with an operator "discouraging" someone from gambling too much. its purpose is to prohibit them receiving economic benefit organizing, operating game of chance.

the economic benefit has nothing do with the money being gambled and clearly states its ok for people to gamble amongst themselves.

Did you read the law?

Thanks for explaining this Texas law to a Texas attorney licensed for 20 years whose job is literally explaining the law to judges.

Yes I read it. The purpose of most anti-gambling laws is to keep people from gambling and losing money, houses, etc.

As I have explained multiple times, there is a perfectly viable and credible argument that the economic benefit prohibited under the statute is that with a direct nexus to the money actually being gambled. Not everyone agrees, obviously. But dozens of attorneys, politicians, and prosecutors do.

yeah way to go to law school like a sucker, you could have saved a few years and a bunch of money getting same knowledge dropped for free here

From what I can tell the origin of that argument is referenced to an opinion labeled "Searcy & Patterson, Practice Commentary, TEX. PENAL CODE ANN. S 47.02 (Vernon 1989).".

I can't seem to find the actual content of that opinion - only references to it. Can you please elaborate on how it was able to argue the limited interpretation of "economic benefit" to only money being actually gambled? Is it based on the parsing of what's in 47.02, or does it instead rely on another TX statute where such a limitation in a different context was clearer?

I mean does it really matter what the law is? All that matters is if people want to prosecute. Litigation alone is enough to destroy a business in these situations and there’s tons of other things they can do to prohibit businesses they don’t like.

Federal doesn’t care if you follow money transmitter laws. State ag is very pro poker. It’s really up to the local authorities. Dallas has always been against it. Rest of the state besides the one incident in Houston related to bribery has never even considered prosecuting.

purpose of gambling laws is to keep people from operating illegal casinos, but we split hairs and not important.


Important thing here is your nexus (love lawyer words). I guess one could argue that "stop at red light" means only a red light that has color of exactly rgb(196, 30, 58), thus I did not break the law by not stopping because the red in that light was rgb(193,29,40) in similar logic to your connection (not lawyer word) to chip in a pot, but OK, for fun, I'll stipulate that red is not really red.

How exactly do you protect the dealer from your nexus? they are sort of kind of directly connected (sorry I mean nexus-ed).

(and no, this is not some thinly veiled appeal for elec tables. Electronic stuff causes other problems with "gambling device" language, and legal risk goes up significantly.

That's not a judicial opinion, but commentary. From the Texas District & County Association website: "When the 1974 Penal Code was adopted, the original publication in the “Black Statutes” included commentary by Seth S. Searcy III and James R. Patterson, which followed each section of the new code with an explanation of the intention of the committee that had drafted it and presented it to the Texas Legislature."

Exactly. As I've said several times, there are multiple possible readings of the law, with each reading having plenty of educated people in the field subscribing to it. What matters is are prosecutors going to push the issue or not.

That's absolutely not close to the same argument, and is disingenuous and insulting. Here are some examples that theoretically should help:

You and I go to BWW for the sole express purpose of watching basketball, betting with each other on the basketball games, and eating wings and drinking beer. BWW is receiving "economic benefit" from us being there and betting with each other. Should BWW be found guilty of "keeping a gambling place"? Why or why not?

What if I tell the server that I have $1,000 on Oklahoma to win, and if they do, I will tip her $100, Oklahoma wins, and I tip her $100. Has the server broken Texas law? Is this now making the manager of that BWW guilty of "keeping a gambling place"? Why or why not?

You and I decide to play golf for $1,000 and select a local municipal course. When we pay the green fees to the course, is the course now receiving economic benefit and the owners should be prosecuted for keeping a gambling place? Why or why not? Should we also be prosecuted for illegal gambling since now "a person is receiving economic benefit other than personal winnings" from our wager? Why or why not?

As stated before, I have a rake-free tourney at my house. We all decide to order pizza. Now the pizza place is "receiving economic benefit" and thus all players should be prosecuted for illegal gambling and I should be prosecuted for keeping a gambling place, right?

Again, I'm not saying these are DIRECTLY analogous to the Texas poker club model. However, they do show that you can't just stomp your feet and say BUT BUT ECONOMIC BENEFIT.

There are 3 basic options:
1) any economic benefit resulting to any person from any gambling violates the statute. This would make all of the above conduct illegal.

2) "economic benefit" means making money from the actual gambled money, other than personal winnings. This would prevent basically any private casino in Texas, OTHER than poker clubs, since as discussed above, poker doesn't have a "house" or "house edge". I couldn't use the Texas poker model to have a blackjack, roulette, slots, bookie, etc., house b/c all of those games have a house which makes profit off of the bet. Since this is a poker forum, I think some people act like the Texas poker model completely neuters the "keeping a gambling place" statute, but it doesn't, it just carves out a niche in a spot where the house doesn't profit from the game itself.

3) "economic benefit" is defined by shades of gray and some things that I think shouldn't count don't, and some things that I think should count do. In some ways, this is a bit how it works in practice, but if this is the argument, you really can't tell other people "no your opinion about it is wrong, and mine is obviously correct".

first, I was joking with my anti-lawyer sentiment. Lawyers are great and much needed (sans personal injury ones, they suck and are mostly leeches on society driving up costs for everyone).

I could nit pick each of your examples as they each have varying degrees of separation from the bet. But lets not play "what about" law.

Lets deal with specific example here.

Hypothetical, You are representing a dealer at a Texas club that was arrested for violation of the Texas statute. Prosecutor claims they received economic benefit directly from operating a game of chance. What is your defense? (Again lets put the "what about" defense to the side for just a moment)

The fact that the law spells out an “affirmative defense to prosecution” suggests that the authors of the law intended to specify the existence of illegal gambling places and legal gambling places. A legal gambling place, in my language, being one where the conditions in section (b) above are satisfied.

I claim that a strict reading of the clause “no person received economic benefit other than personal winnings” would be too strong. Many private places of business/residence are leased or rented. Would a landlord not receive an economic benefit from any legal gambling activities taking place therein? If you read the clause strictly, it would seem that you are arguing that no legal gambling places can exist despite the apparent attempt by lawmakers to carve out such an exception.

Therefore, if you believe my claim, you must believe the lawmakers intended to not read the clause (b)(2) so strictly. Then the question becomes where do you draw the line.

It seems that some are arguing that there is a distinction between a landlord earning rent from a private gambling place, and the owners of the operation charging an hourly entrance fee to a enter a club. Perhaps. But I think it isn’t clear that THIS distinction is apparent from the letter of the law.

Unfortunately, many laws are poorly written, and poorly written laws require clarification by the courts to be properly interpreted. I think chapter 47, specifically section 4, clause (b)(2) is rather poorly written.

Caveat: I am not a lawyer, just a person with training in formal logic. Take my opinion as being as worthless as any other.

Thanks. Is it correct to say that this commentary is the original basis that all pro-poker parties are using to argue for the limited scope of the economic benefit clause?

I didn't mean insulting to lawyers, I'm not thin-skinned about that, and plenty of lawyers earn the rep.

I mean that comparing the argument we are discussing to "red lights aren't really red" is insulting.

In your hypothetical, this would be the easiest thing in the world. The dealer can't be prosecuted for gambling b/c they aren't betting. The dealer can't be prosecuted for "keeping a gambling place" b/c the property isn't "owned by the dealer or under the dealer's control" as is required by the statute. Do you think masseuses in poker clubs can be prosecuted for "keeping a gambling place"??

And you are dismissing my examples as "whataboutism" but that's what you have to do to determine how to read and implement statutes. If you favor a reading in one circumstance that results in absurd results in many others, probably need to rethink that reading.

This is a very good post.

I don't think so, b/c I hadn't heard of it until you posted it, and had been making that argument previously.

IMO the idea that the clause was meant to allow for legal gambling "places" is a very optimistic view. A layman's reading is that it was simply to allow private parties to do what they want in their private residences. That interpretation can reasonably be extended to larger, non-profit groups of private parties. The notion it can be extended to include commercial enterprises whose raison d'être is a for-profit business where gambling is the primary utility is, to me, a wildly optimistic and unreasonable stretch of the clause, again as a layman's interpretation.

If they can argue the legislative intent is different than the layman's reading then sure.

I am not reading all that legal chatter. Cliff notes please. Do we think TCH will have to close in the future or not?

It's referenced as the foundation to the favorable interpretation in Champion's lawsuit against Dallas. That and its date is what lead me to believe is what others based their opinion on.

If you've been using the argument without that foundation then what lead you to independently reach its same interpretation? Your plain interpretation of the clause as written? Some other clause that provides more clarity?

I mean, I'm sure I had read the argument from people who had based it partially on that. The Searcy commentary has no actual precedential value though, it's not a binding reading either way.

I originally actually thought this model violated the statute. But then my mind changed after independently thinking about what economic benefit can rationally mean without sweeping in hundreds of unintended consequences, combined with the fact that poker, unlike literally every other gambling game contemplated under the statute, doesn't actually have a house edge, or a house at all if no rake is taken.

Right, but in my view all those unintended consequence scenarios can be disambiguated by simple intent. If someone intended to make money from facilitating gambling (outside of first-party winnings) then they would be violating the law. And establishing that intent seems rather trivial to me.

Not sure we’re on the same page wrt to your bolded sentence.

Just to be clear what I meant in my post: “Gambling place” is a technical term defined in chapter 47 section 01:

Section 04, which PTLou quoted, then goes on to clarify that a gambling place would be legal if it satisfies the conditions (b)(1-3).

So I think we can all agree that legal gambling places should exist, otherwise why did the lawmakers include Section 04(b).

As for the rest of your post, I do see that we disagree on the scope of the law. What you view as clear I view as ambiguous.

It is interesting to note the Texas AG clarified a possibly related distinction when it came to daily fantasy sports. He wrote that private leagues are OK but for-profit leagues like Draft Kings are not. Of course that is his opinion and I do not know if the matter has been decided in court. I am curious why the AG declined to write an opinion on the poker club business model, but offered his opinion on DFS.

Thanks for the clarification. My read is they defined "gambling place" so broadly to prevent loopholes arising out of later challenges of legislative intent. Which if true is ironic considering how it might be used now for that very purpose but on an exclusionary rather than inclusive basis.

But the law doesn't say they have to intend to make money from it.

If I own a building and I know you are running a bookie operation in it and keeping juice on the bets, I am guilty of keeping a gambling place, even though I'm not making money off of it. The defense of "no economic benefit" ties to if the gambling is illegal gambling or not, and the offense is keeping a place where illegal gambling is occurring. Keeping a place where legal gambling is occurring is fine.

Totally agree.

I misspoke and was jumping ahead. Dealer for sure not caught up in that clause.
My point is that the affirmative defense of "no economic benefit" works OK for owner in case janitor or massuese as not directly involved in game. Thus operator is OK. Hell even operator can play the parsing game and say... its private club , I get paid fees, member can shoot pool and shoot darts so the fee is not direct result of game of chance..


BUT

Owners affirmative defense falls apart because of dealer. Dealer is receiving economic benefit directly from game of chance, there is NO way to obfuscate or parse that fact into anything else

Thus club owner cannot use that affirmative defense

Thus club owner is guilty of keeping a gambling place ? gambling promotion?

Thats what I was trying to spit out before

p.s. In not even sure what affirmative defense means, i just saw it the statute so must be germane to what we are talking about

edit... self dealt games would help. ala early days of CA card club market

Texas seems to have many Problems with Poker.

When I sat at a 2/5 game in TCH Dallas, across the table from a guy with $50k+ in his stack, i knew then that they were on thin ice.


Top right of this photo, you can see half of the guy's stack. Note that pile of 1k plaques.

https://gyazo.com/50b163c9bcb7279f22a4fe9cf6e0e8bd

I don’t understand this line of thinking, what am I missing?
Sure 10K BBs is excessive but I’ve been in stack match 1/2s where I’ve bought in $5,500 and absurd amounts

Sorry I wasn't being clear, was alluding to the amount of cash they have on the premises. Logic being if 2/5 has 50k stacks, bigger games have should have even more. Tons of cash on hand=more incentive to the bad guys. They were also streaming like 25/50+ games, and you'd regularly see reloads with stacks and stacks of cash, from backpacks.

That kind of money will always attract attention, and it makes sense why local legislatures got nervous.

It was a great room, sorry to see it go.