Text messages, cell phones, TV game shows, Howie Mandel -- none of these could have been contemplated by Georgia's colonial lawmakers when they first passed a law allowing gamblers to recover their losses through lawsuits.
The current version of the law, found at Official Code of Georgia Annotated §13-8-3, is at the center of a case against NBC Universal and the producer of Mandel's hit show, "Deal or No Deal," to be heard Tuesday before the state Supreme Court.
The justices have been asked to interpret Georgia law for a federal judge overseeing a case filed by a group of Columbus, Ga., lawyers on behalf of a proposed class of people who participated in the Lucky Case Game, an interactive feature of "Deal or No Deal."
The plaintiffs lawyers say the game -- in which viewers, like the contestants on the show, try to pick a lucky suitcase -- ran afoul of Georgia law because participants were charged 99 cents to play through their cell phones.
NBC Universal and the other defendants say they are not obligated to return the 99 cent fees because viewers could play for free on the Internet. They also argue that they weren't winners in a gambling contract. The winners, they say, were the participants who picked the right suitcase and were then chosen from a random drawing to get at least $10,000. (The Lucky Case Game, according to NBC's Web site, is "taking a short break.")
The federal judge overseeing the case, Senior Judge William C. O'Kelley, has suggested that "probably" tens of millions of dollars are at stake in the case.
It was brought in the U.S. District Court for the Northern District of Georgia by Forsyth County residents Michael and Michele Hardin, who say they're regular viewers of "Deal or No Deal" and have played the Lucky Case Game multiple times.
They want to represent a class of Georgians who played the game from Georgia cell phone numbers -- as well as those who played other games promoted on NBC. The Hardins allege that there are similar legal problems with games that have been televised as part of NBC's "1 vs. 100" game show, "America's Got Talent" and the Kentucky Derby and Preakness Stakes horse races.
Represented by the Columbus firms of Buchanan & Land and Daughtery, Crawford, Fuller & Brown, the Hardins are relying on OCGA §13-8-3. Along with voiding gambling contracts, it provides that "[m]oney paid or property delivered upon a gambling consideration may be recovered from the winner by the loser by institution of an action for the same within six months after the loss." Later suits also can recover money but have to share the proceeds with county education funds.
A lottery is considered gambling under Georgia law, say the plaintiffs in their filings, and only the state can operate one. The Lucky Case Game is a lottery because people pay money -- the 99 cents text message fee -- for a chance to win a bigger prize, they say.
"If NBC had not charged Georgians premium text message charges to play," explained one of the plaintiffs lawyers, J. Clay Fuller, "there would have been no lawsuit."
A set of similar cases challenging the Lucky Case Game and other NBC games is pending before a California federal judge. Most of the named plaintiffs in those cases also are Georgia residents, and Atlanta lawyers William A. Pannell and Kevin T. Moore are among the plaintiffs' counsel team that includes lawyers at Milberg Weiss' Los Angeles office.
NBC Universal, show producer Endemol USA and game administrator VeriSign moved to dismiss the suit pending before O'Kelley in August. Represented by lawyers at King & Spalding in Atlanta and Arnold & Porter in Washington, D.C., NBC cited several problems with the plaintiffs' theory.
In considering the motion, O'Kelley indicated he wasn't ready to buy the defendants' argument that the game was just an advertising promotion -- and therefore exempt from the state law's definition of a lottery. He noted that the games likely generate millions in revenue.
But he punted a "looming, unresolved question" to the state high court -- whether the loser of an illegal lottery can sue to recover his losses. Two Georgia Court of Appeals decisions from the 1940s concluded that the statute under which plaintiffs are suing didn't apply to lotteries, O'Kelley noted, but the statute since has been revised. He also asked the state Supreme Court to look at the question of whether the defendants can be considered "winners" of the Lucky Case Game under the civil recovery statute.
NBC says in its appellate brief that the changes to the civil recovery statute don't help the plaintiffs. Moreover, say the defendants, the game wasn't gambling because the defendants took no risk -- regardless of the outcome, they had to award the prize at a predetermined amount. They say they're not the "winners," either.
"In fact," say the defendants in their brief, "the true 'winners' of the Lucky Case Game received prizes every time that the promotion was aired."
The plaintiffs say that NBC and the other defendants are the winners. "Where Defendants constructed a game to make huge profits by retaining money paid to play," says the plaintiffs' appellate brief, "they have obtained, earned and won that money."
Jerry A. Buchanan of Buchanan & Land is expected to make the plaintiffs' argument before the justices Tuesday, when the court will take its show on the road to Emory University School of Law. Fuller said his firm, Daughtery, Crawford, Fuller & Brown, is teaming up with Buchanan's firm despite being adverse on other class action matters.
"We've worked against each other on some cases," said Fuller, "and now we feel real fortunate to be working together on this one."
L. Joseph Loveland Jr. of King & Spalding, expected to argue Tuesday for the defendants, declined to comment for this story.
The case at the state Supreme Court is Hardin v. NBC Universal, No. S08Q0323.
