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Judge denies preliminary injunction in Flint sweepstakes cafe

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A Genesee County judge sided with the Attorney General by denying an Internet sweepstakes cafe’s request to stay in operation without the threat of prosecution.
Attorney General Bill Schuette has sent cease and desist letters to a dozen Internet sweepstakes cafes, which he contends are illegal gambling operations.
The cafes sell Internet access or long-distance phone cards. With each purchase, a customer receives free sweepstakes entries to play casino-style computer games for cash prizes.
Flint Business Center filed a lawsuit against Schuette and requested a preliminary injunction to prevent the state from prosecuting the cafe or seizing its assets
Even though only one cafe was listed on the suit, the outcome can impact enforcement of other operations throughout the state.

Judge Judith Fullerton of Genesee’s 7th Circuit Court on Monday denied the cafe’s request.
“The investigators of the Michigan State Police Gaming Section are committed to the enforcement of the state’s gaming laws, working in conjunction with the Michigan Attorney General’s Office and the Michigan Gaming Control Board,” Michigan State Police Director Col. Kriste Kibbey Etue said in a statement. “Businesses operating outside of the law will be shut down.”

An attorney for the cafe was not available for comment Wednesday afternoon.
The business agreed to close after being warned of potential prosecution.
The cafe argued in its lawsuit that it doesn’t meet the criteria for a gambling operation and likened it to a McDonald’s Monopoly sweepstakes.

http://www.mlive.com/business/index.ssf/2012/06/judge_makes_initial_ruling_in.html

Schuette plans to file a motion to dismiss the lawsuit.

Michigan Attorney General Wants To Restrict Computer Access

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The state has issued cease-and-desist letters to nine Internet sweepstakes cafes, including five in Metro Detroit, alleged to be illegal gambling operations.

Internet sweepstakes cafes sell Internet access and the chance to play computer-based casino-style games in which consumers can win cash prizes. This gaming style violates the Michigan Gaming Control and Revenue Act, said Michigan Attorney General Bill Schuette.

Schuette’s letters warned the businesses of possible legal action should owners and operators refuse to halt gambling operations.

Among the nine cafes implicated Tuesday were Players Club Internet Cafe in Warren, Treasure Internet Lounge in Clinton Township, Treasure One Cyber Cage in Roseville, Players Club Pontiac and Super Cafe Internet Cafe in Taylor.

Others were in Lansing and Flint.

“Citizens should steer clear of Internet sweepstakes cafes that are nothing more than unregistered, illegal casinos,” Schuette said.

Investigations are pending against the owners and operators and may result in additional criminal or civil charges, the state said.

According to the state, Internet sweepstakes cafes have banks of computers with Internet access.

Each purchase entitles a patron to a certain number of sweepstakes entries.

“The customer is then given the opportunity to ‘reveal’ whether the sweepstakes entries are winners by using a computer monitor that activates a spinning wheel similar to that of a casino-style video slot machine,” the state said.

Jake Miklojcik of Lansing-based Michigan Consultants has previously said Michigan isn’t likely to legalize Internet sweepstakes cafes because the casinos and most of the evangelical community oppose them.

Before Tuesday’s action, the Alcohol and Gambling Enforcement in May issued eight cease-and-desist orders; none of the cafes was in Metro Detroit.

Previously, Players Club Internet Cafe in Westland voluntarily closed to avoid legal action by Schuette’s office.

http://www.detroitnews.com/article/20120613/BIZ/206130319/Gaming-sites-Internet-get-state-warning-letter?odyssey=mod%7Cnewswell%7Ctext%7CFRONTPAGE%7Cs