IN THE SUPREME COURT OF OHIO FRATERNAL ORDER OF EAGLES AERIE 2171 MEIGS, INC., ET. AL. vs. Appellants, STATE OF OHIO DEPARTMENT OF PUBLIC SAFETY, Case No. 2006-2105 On Appeal from the Fourth Appellate District, Meigs County Court of Appeals Case No. 05 CA 18 Appellee. MEMORANDUM IN OPPOSITION TO JURISDICTION OF APPELLEE, OHIO DEPARTMENT OF PUBLIC SAFETY JIM PETRO (0022096) Attorney General of Ohio MARK FOLEY (0018772) Counsel of Record Portman, Foley and Flint, LLP 471 East Broad Street, Suite 1820 Columbus, Ohio 43215 614-461-1234 614-461-9150 (fax) Counsel for Appellants FOE Aerie 2171 Meigs, Inc., et. al. MATTHEW J. LAMPKE (0067973) Deputy Attomey General Counsel of Record 30 East Broad Street, 26`" Floor Columbus, Ohio 43215-4200 614-466-8569 614-466-918 0 (fax) mlampke@ag.state.oh.us Counsel for Appellee Ohio Department of Public Safety ;^ =^M,..^^...^_-_.._..._._ LEDD DEC t2 2006 MARCIA ivi6-ii^uel ^ C^.ERK 5UPREMF CGt IR7 (y^ OI 11f1
TABLE OF CONTENTS INTRODUCTION...1 THIS CASE IS NOT OF PUBLIC AND GREAT GENERAL INTEREST... STATEMENT OF THE CASE AND FACTS............ LAW AND ARGUMENT............ A. Response to Proposition of Law 1: Page Jurisdiction is abrogated in every court but the Franklin County Court of Common Pleas in actions to restrain or compel actions of the Ohio Department of Public Safety and its enforcement agents in performing their duties under Chapters 4301 and 4303 of the Revised Code... CONCLUSION... CERTIFICATE OF SERVICE...:...
INTRODUCTION This case presents a routine challenge to a state statute that specifically limits the jurisdiction of Ohio common pleas courts. This case presents no new issue for the Court to review and does not present any question of public and great general interest. Here, the court of appeals reversed the common pleas court's grant of a preliminary injunction as the common pleas court lacked subject matter jurisdiction to enjoin the Department of Public Safety and its employees. The court of appeals correctly decided the jurisdictional question. While this Court has not had the opportunity to review this jurisdictional question in a case involving the Ohio Department of Public Safety, it has already decided that only the Franklin County Court of Common Pleas has jurisdiction to bear cases to restrain or compel duties under Ohio liquor laws. The jurisdiction of all other common pleas courts to hear matters seeking to restrain or compel duties under Ohio's liquor laws has been abrogated. For these reasons, as well as others detailed below, the Court should deny review in this case.
THIS CASE IS NOT OF PUBLIC AND GREAT GENERAL INTEREST Appellants ask this Court to take this case for review so that, if successful, an advisory opinion may be issued as to whether an electronic video machine is an illegal slot machine or a legal skill based amusement machine. The Meigs County Court of Common Pleas restrained the Ohio Department of Public Safety and its employees from seizing any Tic Tac Fruit electronic video machines. Pursuant to R.C. 4301.31, jurisdiction to restrain the actions of the enforcement agents of the Department of Public Safety lies with only the Franklin County Common Pleas Court. There are many policy reasons for restricting the jurisdiction to one common pleas court. The Franklin County Common Pleas Court has developed an expertise in this area of law and is not subject to the local influences that may interfere with the regulation of the liquor industry. Cases of public and great general interest typically involve a split among the appellate courts. Both appellate courts that have considered the jurisdictional statute found in R.C. 4301.31 - the Eighth and the Fourth Districts - are in agreement that jurisdiction rests with the Franklin County Court of Common Pleas. Moreover, the lower courts are following this Court's precedent in its review and interpretation of this jurisdictional statute. The standard in considering and reviewing actions for declaratory judgment and injunctive relief is well settled.. This Court has routinely held that equity cannot interfere with the criminal process where there is adequate protection at law. This Court also has held that equitable relief should not be exercised where there is an adequate legal remedy. While the common pleas court erred in its review, the Fourth District correctly follow this Court's established precedent. 3
Appellants refer to various statistics regarding the economic impact that could be had from seizure of the Tic Tac Fruit machine. The Tic Tac Fruit machine has been found to be a gambling device and administrative, civil and criminal actions have been taken against operators of this machine. Appellants' general references aside, no legitimate manufacturer, distributor, or operator of coin operated machines is supplying the Tic Tac Fruit machine. Moreover, the identical matter is pending before the Franklin County Court of Common Pleas. In one action, Appellants are pursuing a declaratory injunction and injunctive relief. In a separate action, Appellants are challenging the merits decision of the Ohio Liquor Control Connnission finding the machine is a gambling device. Therefore, this Court should not grant jurisdiction in this case as there is no unique issue of law presented for this Court's review and this issue is proceeding through the court with proper jurisdiction. 4
STATEMENT OF THE CASE AND FACTS On December 9, 2004, enforcement agents of the Investigative Unit of the Department of Public Safety ("DPS)" conducted an administrative inspection of a liquor permit premises and seized three electronic video gambling devices called Tic Tac Fruit. As is relevant here, the Appellant's Fraternal Order of Eagles Aerie 2171 Meigs, Inc. ("FOE") was cited for permitting electronic video gambling in violation of O.A.C. 4301:1-1-53. The Ohio Liquor Control Commission held an unprecedented two day administrative hearing in October of 2005 and January of 2006 before determining that the Tic Tac Fruit machines were gambling devices. The Liquor Commission Order is on appeal to the Franklin County Court of Common Pleas in Case No. 06CVF-4-5326. Six months after the administrative citation was issued, on June 20, 2005, FOE filed a complaint for declaratory judgment to have the Tic Tac Fruit machines declared compliant with Ohio law as a skill based amusement machine. FOE also sought injunctive relief to enjoin DPS from enforcing criminal or administrative laws regarding this machine. On November 2, 2005, the trial court denied DPS' motion to dismiss the complaint for lack of jurisdiction and the availability of an adequate legal remedy. A hearing was held on August 1, 2005 on FOE's request for injunctive relief. Each party filed proposed findings of fact and conclusions of law. On November 2, 2005, the common pleas court adopted FOE's findings and granted the preliminary injunction enjoining DPS from prosecuting or disrupting the sale, distribution, operation or play of the Tic Tac Fruit machines. After the preliminary injunction was entered by the Judge, enforcement agents of the Department of Public Safety confiscated Tic Tac Fruit machines in Lake County, Ohio. Following a hearing on FOE's motion to show cause, the common pleas court found these 5
enforcement agents were in violation of the preliminary injunction in a contempt hearing and ordered the confiscated machines returned. The contempt action is not at issue in this appeal as the injunction itself was reversed by the court of appeals for lack of jurisdiction. The court of appeals held that the common pleas court could not enter any order against DPS or its employees. However, the contempt action is relevant as it demonstrates that while Appellants attempt to classify this as an action against only the Department of Public Safety, they also seek to enjoin the Department's enforcement agents pursuant to Civ.R. 65(D). DPS appealed the common pleas court's order to the Fourth District Court of Appeals on November 16, 2005. On September 28, 2006, the Fourth District Court of Appeals reversed the common pleas court, finding that the lower court lacked subject matter jurisdiction pursuant to the plain meaning of R.C. 4301.31. Appellants filed a timely notice of appeal to this Court on November 13, 2006. 6
LAW AND ARGUMENT A. RESPONSE TO PROPOSITION OF LAW 1: Jurisdiction is abrogated in every court but the Franklin County Court of Common Pleas in actions to restrain or compel actions of the Ohio Department of Public Safety and its enforcement agents in performing their duties under Chapters 4301 and 4303 of the Revised Code. The Appellants have asked this Court to accept jurisdiction to review the question of whether all Ohio courts have jurisdiction to consider declaratory judgment and injunctive relief actions against the Ohio Department of Public Safety and its employees in the enforcement of its duties in regulating liquor permit premises. Subject matter jurisdiction to review DPS' actions in enforcing Ohio's liquor laws is established in the Franklin County Court of Common Pleas pursuant to R.C. 4301.31. The common pleas court erroneously determined that it had jurisdiction to issue a preliminary injunction preventing DPS and its agents from prosecuting or instituting administrative charges against the operators of the Tic Tac Fruit machine. It also erroneously found enforcement agents of DPS in contempt of the injunction for confiscating a Tic Tac Fruit machine in a separate county. The General Assembly has specifically limited jurisdiction over liquor enforcement and its agents to the Court of Common Pleas of Franklin County. R.C. 4301.31 provides in relevant part as follows: Except as provided in section 4301.28 of the Revised Code, no Court, other than the court of common pleas of Franklin County, has jurisdiction of any action against the liquor control commission, enforcement agents of the department of public safety, the superintendent of liquor control, or the division of liquor control, to restrain the exercise of any power or to compel the performance of any duty under chapters 4301. and 4303. of the Revised Code. 7
This Court has reviewed this statute and declared that jurisdiction over actions relating to Ohio's liquor control laws and liquor permits resides with the common pleas court of Franklin County. "In providing that `no court, other than the court of common pleas of Franklin County has jurisdiction' to restrain or compel the department's conduct, R.C. 4301.31 operates not to confer jurisdiction on the Franklin County Court of Common Pleas, but rather to abrogate subject-matter jurisdiction of all other courts of the state." (emphasis in original) BCL Enters. v. Dept. of Liquor Control (1997), 77 Ohio St.3d 467, 470. The General Assembly determined, and this Court has held, that if Appellants want to pursue their present action they must pursue it in the Franklin County Common Pleas Court. Ohio's appellate courts have consistently upheld jurisdictional challenges similar to the present case. In Allied Inv. Credit Corp. v. Kuzio Tavern, Inc. (May 18, 1978), Cuyahoga App. No. 37453, 1978 Ohio App. LEXIS 10386 at 10 (Appx. A), the Eighth District Court of Appeals specifically upheld a dismissal of a claim for injunctive relief for such lack of jurisdiction: Article I, Section 16 of the Ohio Constitution provides for the waiver of the State's immunity from suit. It has been held that this section of the Constitution is not self-executing. Suits may be brought against the State only in such manner as may be provided by law. Wolf v. Ohio State Univ. Hosp., et al. (1959), 170 Ohio St. 39. The legislature has provided that the Ohio Department of Liquor Control' can only be sued in the Franklin County Common Pleas Court, R.C. 4301.31. * * * Clearly, the law has not provided for suit against the Department of Liquor Control in Cleveland Municipal Court on the issue of the present case, i.e., transfer of a permit. The Court then stressed that "venue" is not an issue since no iurisdiction exists: It is true that in an action against an Ohio Department of Liquor Control, venue in the Cleveland Municipal Court would be proper under Civ. R. 3(B). However, the receiver is confusing venue and ' On July 1, 1997, the functions of the Dept. of Liquor Control, except for law enforcement functions transferred to DPS, were transferred to the Division of Liquor Control established in the Dept. of Commerce. See R.C. 121.08. 8
jurisdiction. As stated in the first syllabus of Morrison v. Steiner (1972), 32 Ohio St.2d 86: "Subject matter jurisdiction of a court connotes the power to hear and decide the case upon its merits; venue connotes the locality where the suit should be heard." R.C. 4301.31 states: [no] court, other than the court of common pleas of Franklin County has iurisdiction of any action against... the Department of Liquor Control. (Court's emphasis). It is clear the statute refers to the power of the courts to hear such an action on the merits, and not merely to the procedural questions of where the case should be brought. Id. at 12. Rickard v. Dept. of Liquor Control (1986), 29 Ohio App.3d 133, paragraph one of the syllabus (an action for a declaration of the constitutionality of the statutes providing for a localoption election must be brought in the Franklin County Common Pleas Court). In Blackwell, Inc. v. Dept. of Liquor Control (Dec. 26, 1996), Cuyahoga App. No. 70758, 1996 Ohio App. LEXIS 5827 at *6-7 (Appx. B), the Eighth District again rejected jurisdiction over a claim for injunctive relief due to R.C. 4301.31: It is clear that in cases where a party sues [Ohio Department of Liquor Control] for declaratory or injunctive relief exclusive jurisdiction for such cases rests with the Franklin County Court of Common Pleas. In the present case, plaintiff filed his declaratory judgment action against ODLC in the Cuyahoga County Court of Common Pleas which is in contravention of established case law and R.C. 4301.31. Therefore, the trial court was correct in granting ODLC's motion to dismiss and plaintiff's first assignment of error is overruled. FOE has argued that DPS itself is not specifically listed in the statute. However, the only way to enjoin DPS itself is to restrain the actions of the enforcement agents who issue the administrative citations to liquor permit holders. DPS encompasses not only the Investigative Unit, but also the State Highway Patrol, Homeland Security, Bureau of Motor Vehicles, Emergency Management Agency, Emergency Medical Services, Ohio Criminal Justice Services 9
and Administration. R.C. 4765.02; 5502.03; 5502.13; 5502.22; 5502.62; 5503.01. These remaining divisions of DPS do not enforce Chapters 4301 and 4303 of the Revised Code and equitable remedies may be brought against them in any Ohio court. However, the General Assembly, in prescribing actions involving Chapters 4301 and 4303 of the Revised Code, limit subject matter jurisdiction in actions brought to restrain or compel DPS's enforcement of Ohio's liquor laws to the Franklin County Court of Common Pleas. The folly of Appellants' argument is shown when examining it against the only other state agency listed in this jurisdictional statute.. Actions against the Division of Liquor Control or the Superintendent of that Division may be brought only in the Franklin County Court of Common Pleas. R.C. 4301.31. However, the Department of Commerce is not specifically enumerated. By Appellants' logic, they can obtain injunctive relief against the Ohio Department of Commerce when that Department denies a liquor permit license. Pursuant to Civ.R. 65(D), it may then restrain the Department's officers, agents and employees, including the Division of Liquor Control and the Superintendent of that Division, even though they are enumerated in the statute. Appellants are pursuing equitable relief indirectly which they cannot pursue directly. Appellants are pursuing a supposed right to bring this action in any Ohio court. However, they seek to restrain the enforcement of Ohio's liquor laws in a Meigs County Court. Appellants may not restrain the enforcement agents in their regulation and seizure of these gambling machines outside of the Franklin County Court of Common Pleas. Appellants do have two remedies which they are pursuing with equal vigor. They brought an identical action for declaratory judgment and injunctive relief in the Franklin County Court of Common Pleas, Case No. 06CVH11 14726, which is active and pending. They are 10
pursuing the identical claim they had previously filed in Meigs County, only this time they are pursuing it in the proper jurisdiction. Appellants are also pursuing their administrative remedy by appealing the Liquor Commission's Order that the Tic Tac Fruit machine is a gambling device subject to seizure. Appellants challenged the administrative citation before the Liquor Control Commission and have appealed that adverse determination pursuant to R.C. 119.12. The merits of whether this machine is a gambling device and slot machine or complies with a skill based amusement machine exception will be resolved outside of this action. This case does not concem denying FOE or the other Appellants a judicial forum. This case concerns pursuing litigation in the appropriate jurisdiction which, in this case, is not the Meigs County Court of Common Pleas. Either the injunction against DPS is a right without a remedy - because the lower courts are abrogated from asserting jurisdiction over the enforcement agents - or the trial court enjoined the enforcement agents of DPS from any further administrative or criminal interference with the Tic Tac Fruit machine in violation of the jurisdictional restriction found in R.C. 4301.31. Therefore, this Court should decline jurisdiction as the appellate court employed the correct legal standard in finding that subject matter jurisdiction is abrogated in the lower courts in actions to restrain DPS and its enforcement agents from the performance of their duties in enforcing Ohio's liquor laws. 11
CONCLUSION For the above reasons, the Court should deny review of this case. JIM PETRO (0022096) Attorney General of Ohio MATTHE J. LAMP (0067973) Deputy Attorney General Counsel of Record 30 East Broad Street, 26h Floor Columbus, Ohio 43215-4200 614-466-8569 614-466-9180 (fax) mlampke@ag.state.oh.us Counsel for Appellee Ohio Department of Public Safety CERTIFICATE OF SERVICE This is to certify that a copy of the foregoing Memorandum in Opposition to Jurisdiction has been served via U.S. Mail this 1^6ay of December, 2006, on counsel for Appellees, Mark Foley, Portman, Foley and Flint, LLP, 471 East Broad Street, Suite 1820, Columbus, Ohio 43215. A MATTHE\WJ. LAMP Deputy Attorney General 12