ORDERS:
ORDER DENYING STAY
This matter comes before me upon a Motion to Stay the effect of this Court's Final Order
and Decision in the above-captioned matter pending judicial review, pursuant to S.C. Code Ann.
§ 1-23-380(A)(2) (Supp. 1997) and ALJD Rule 29(D), filed by Respondent A&E Distribution,
Inc. At the motion hearing Respondent Fountain of Luck, Inc. joined in the motion. South
Carolina Department of Revenue (hereinafter referred to as "DOR") opposes the stay motion.
This Court's Final Order and Decision in the above-captioned matter was filed on December 31,
1997. To date, no petition for appeal to circuit court has been filed; however, Respondents
inform the Court that they intend to appeal and that the time for appeal has not yet expired. In the Final Order and Decision in this video poker violation case filed December 31,
1997, retail operator Fountain of Luck, Inc. was found to have violated 27 S.C. Code Ann. Regs.
117-190 (Supp. 1996) and S.C. Code Ann. 12-21-2804 (Supp. 1996). The ten machine licenses
were revoked, the operation of machines were prohibited in the subject game rooms for a period
of six months, and a fine of $5,000 was imposed upon Fountain of Luck, Inc. Respondent A&E
Distribution, Inc. was fined $2,500 for a violation of S.C. Code Ann. 12-21-2748 (Supp. 1996).
In the absence of a stay, Respondents claim that they will suffer irreparable harm through
loss of revenue. Respondents also point to the potential for the South Carolina Supreme Court to
decide material and novel issues in the case of Gateway Enterprises, Inc. v. DOR which may
have an impact upon one or several issues in the present case.
DOR asserts that the effect of the Final Order and Decision in this matter does not
prevent the machine owners from relicensing the machines and placing them in another location,
nor does it prevent the retail operator from using the business premises for any purpose other
than operation of Class III video game machines. Additionally, DOR maintains that the issuance
of a stay would thwart its efforts to regulate the video gaming industry and enforce the gambling
laws of this State.
Under the Administrative Procedures Act, the filing of a petition for judicial review of a
final order of an administrative law judge does not stay the enforcement of the administrative
decision. The administrative law judge or the reviewing court may grant a stay upon appropriate
terms. Pursuant to ALJD Rule 29(D), at any time prior to the filing of a petition for judicial
review a party may move this Court to stay a final order upon appropriate terms, and the
administrative law judge has the authority to stay the effect of a final order which is subject to
judicial review. The granting of a stay of execution is discretionary. Thompson v. Watts, 278
S.C. 230, 294 S.E.2d 245 (1982).
Respondents failed to offer compelling reasons for a stay of the administrative decision
rendered in this matter. Because the potential loss of income alleged by Respondents during the
pendency of an appeal of the final order in this matter does not outweigh the public harm of
inconsistent and ineffective enforcement of the Video Game Machines Act and related
regulations, a stay is not warranted. Feasible alternatives exist for Respondents to avoid or
mitigate any lost revenue resulting from the enforcement of the December 31, 1997 Order. For
the foregoing reasons, Respondents' Motion to Stay is denied.
AND IT IS SO ORDERED.
_____________________________
STEPHEN P. BATES
ADMINISTRATIVE LAW JUDGE
January 26, 1998
Columbia, South Carolina |