APPENDIX A A BILL To prohibit transportation of gambling devices in interstate and Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled. SECTION 1. As used in this act the term "gambling device" means any machine or mechanical device, or parts thereof, designed or adapted for gambling or any use by which the user as a result of the application of any element of chance may become entitled to receive, directly or indirectly, any thing of value. SEC. 2. It shall be unlawful knowingly to transport or cause to be transported in interstate or foreign commerce any gambling device, or knowingly to take, receive, possess, or dispose of any gambling device transported in violation of this act: Provided, That the provisions of this section shall not apply to the course of unbroken interstate transportation of any gambling device into any State where the use of such device is legal, as certified by the Governor of the State to the Attorney General of the United States and published by the Attorney General in the Federal Register. In the absence of such certification and publication, the use of gambling devices in any State shall, for the purposes of this act, be presumed to be illegal; and all persons and officials affected by the provisions of this act shall be entitled to act in reliance upon the presumption. Nothing in this act shall be construed to interfere with or reduce the authority, or the existing interpretations of the authority, of the Federal Trade Commission under the Federal Trade Commission Act, as amended (15 U. S. C. 41-58). SEC. 3. Upon first engaging in business, and thereafter on or before the first day of July of each year, every manufacturer of and dealer in gambling devices shall register with the (Collector of Internal Revenue) for each district in which such business is to be carried on his name or trade name, the address of his principal place of business, and the addresses of his places of business in such district. On or before the last day of each month every manufacturer of and dealer in gambling devices shall file with the (Collector of Internal Revenue) for each district in which he maintains a place or places of business an inventory and record of all sales and deliveries of gambling devices as of the close of the preceding calendar month for the place or places of business in the district. The monthly record of sales and deliveries of such gambling devices shall show the mark and number identifying each article together with the name and address of the buyer or consignee thereof and the name and address of the carrier. Duplicate bills or invoices, if complete in the foregoing respects, may be used in filing the record of sales and deliveries. For the purposes of this act, every manufacturer or dealer shall mark and number each gambling device so that it is individually identifiable. In cases of sale, delivery, or shipment of gambling devices in unassembled form, the manufacturer or dealer shall separately mark and number the components of each gambling device with a common mark and number as if it were an assembled gambling device. It shall be unlawful for any manufacturer or dealer to sell, deliver, or ship any gambling device which is not marked and numbered for identification as herein provided; and it shall be unlawful for any manufacturer or dealer to manufacture, recondition, repair, sell, deliver, or ship any gambling device without having registered as required by this section, or without filing monthly the required inventories and records of sales and deliveries. SEC. 4. All gambling devices, and all packages containing any such, when shipped or transported shall be plainly and clearly labeled or marked so that the name and address of the shipper and of the consignee, and the nature of the article or the contents of the package may be readily ascertained on an inspection of the outside of the article or package. SEC. 5. It shall be unlawful to manufacture, recondition, repair, sell, transport, possess or use any gambling device in the District of Columbia, the territories and possessions of the United States, on any lands reserved or acquired for the use of the United States and under the exclusive or concurrent jurisdiction thereof or within Indian country as defined in 18 U. S. C. 1151. SEC. 6. Whoever violates any of the provisions of sections 2 or 5 of this act shall be fined not more than $5,000 or imprisoned not more than 2 years or both. Whoever violates any of the provisions of sections 3 or 4 of this act shall be fined not more than $2,000 or imprisoned not more than 1 year or both. SEC. 7. Any gambling device transported, delivered, shipped, manufactured, reconditioned, repaired, sold, disposed of, received, possessed, or used in violation of the provisions of this act, shall be seized and forfeited to the United States. All provisions of law relating to the seizure, summary and judicial forfeiture, and condemnation of vessels, vehicles, merchandise, and baggage for violation of the customs laws; the disposition of such vessels, vehicles, merchandise, and baggage or the proceeds from the sale thereof; the remission or mitigation of such forfeitures; and the compromise of claims and the award of compensation to informers in respect of such forfeitures shall apply to seizures and forfeitures incurred, or alleged to have been incurred, under the provisions of this act, insofar as applicable and not inconsistent with the provisions hereof: Provided, That such duties as are imposed upon the collector of customs or any other person with respect to the seizure and forfeiture of vessels, vehicles, merchandise, and baggage under the customs laws shall be performed with respect to seizures and forfeitures of gambling devices under this act by such officers, agents, or other persons as may be authorized or designated for that purpose by the Attorney General. SEC. 8 If any provision of this act or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of the act which can be given effect without the invalid provision or application, and to this end the provisions of this act are declared to be severable. FEDERAL ANTIGAMBLING DEVICE LEGISLATION EXPLANATORY STATEMENT Purpose The purpose of the proposed bill is to support the basic policy of the States, which outlaws slot machines and similar gambling devices, by prohibiting the interstate shipment of such machines except into States where their use is legal.. By way of additional support, foreign import or export of the machines is prohibited and their manufacture, possession, and use is forbidden in those parts of the United States where the Federal Government is primarily responsible for enforcement of the criminal laws, such as the District of Columbia. Background Among the recommendations made by the Attorney General's Conference on Organized Crime, February 15, 1950, for study and exploration by the Legislative Committee of the Conference was the following: "Be it resolved, that this conference endorse the idea of Federal legislation to prohibit the shipment of gambling devices into or out of any State where the possession or use of such devices is illegal. Further, requiring Federal registration of all such machines sold within States and prohibiting foreign export of such devices." In addition, members of the conference called attention to the existence of troublesome problems concerning slot machines in, or emanating from, certain areas where the Federal Government exercises exclusive criminal jurisdiction. In the history of Federal-State relationships, the use of Federal power to support State policies has had a number of important precedents. For example, in the field of liquor-law enforcement Congress enacted the Wilson Act, 26 Stat. 313, now 27 U. S. C. 121, held valid in In re Rahrer, 140 U. S. 545; followed by the Webb Kenyon Law of 1913, 37 Stat. 699, now 27 U. S. C. 122, held valid in Clark Distilling Co. v. Western Maryland Railway, 242 U. S. 311; supplemented by the Reed Amendment of 1917, 39 Stat. 1069, upheld in United States v. Hill, 248 U. S. 420, 424 (amendment repealed in 1936 by 49 Stat. pt. I 1930, sec. 9); and followed still later by the Liquor Enforcement Act of 1936, 49 Stat. pt. I 1928, now 18 U. S. C. 1261-1264, 3615. By these statutes, Congress prohibited the interstate transportation of intoxicating liquor into a State where the law forbade the bringing in of intoxicating liquor (but allowing for continuous interstate transportation through the State, 18 U. S. C. 1262) or where it was to be used in violation of the law of the State (27 U. S. C. 122); and subjected to the laws of the State intoxicating liquor which was transported there for use (27 U. S. C. 121). As the court said in the Clark Distilling Co. case, supra: "In view of the conceded power on the part of Congress to prohibit the movement of intoxicants in interstate commerce, we cannot admit that because it did not exert its authority to the full limit, but simply regulated to the extent of permitting the prohibitions in one State to prevent the use of interstate commerce to ship liquor from another State, Congress exceeded its authority to regulate" 242 U. S. 311, 327. And again "Congress considered the nature and character of our dual system of government, State and Nation, and instead of absolutely prohibiting, had so conformed its regulation as to produce cooperation between the local and national forces of government to the end of preserving the rights of all 242 U. S. 311, 331. * * In the field of prison-made goods Congress enacted the Hawes-Cooper Act of 1929, 45 Stat. 1084, held valid in Whitfield v. Ohio, 297 U. S. 431, and later the Ashurst-Sumners Act, 49 Stat. 494 (since revised and merged into 18 U. S. C. 1761, 1762), held valid in Kentucky Whip and Collar Co. v. Illinois Central Railroad Co., 299 U. S. 334. Under the Ashurst-Sumners Act Congress made it unlawful to knowingly transport in interstate or foreign commerce goods made by convict labor into any State where the goods were intended to be used or sold in violation of the State's laws. As Chief Justice Hughes pointed uot for the court: "The pertinent point is that where the subject of commerce is one as to which the power of the State may constitutionally be exerted by restriction or prohibition in order to prevent harmful consequences, the Congress may, if it sees fit, put forth its power to regulate interstate commerce so as to prevent that commerce from being used to impede the carrying out of the State policy. .66* * * Nor has the Congress attempted to delegate its authority to the States. The Congress has not sought to exercise a power not granted or to usurp the police powers of the States. It has not acted on any assumption of a power enlarged by virtue of State action. The Congress has exercised its plenary power, which is subject to no limitation other than that which is found in the Constitution itself. The Congress has formulated its own policy and established its own rule. The fact that it has adopted its rule in order to aid the enforcement of valid State laws affords no ground for constitutional objection" 299 U. S. 334, 351–352. Still another example is the Lacey Act of 1900, 31 Stat. 188 (partly repealed March 4, 1909, 35 Stat. 1158, section 341, partly continued, see 16 U. S. C., 1946 Ed. Supp. II, 668 (d)), under which Congress made it unlawful to ship birds or game killed in violation of the laws of the States and removing the interstate commerce protection for those shipped; held valid in Rupert v. United States, 181 Fed. 87 (C. C. A. 8, 1910). Of course, ever since the decision of the Lottery Case in 1902 (Champion v. Ames, 188 U. S. 321) holding that Congress may prohibit the interstate carriage of lottery tickets, there has been no room for doubt of the authority of Congress to exclude from the channels of interstate commerce various forms of gambling paraphernalia such as, in this case, gambling machines. What the court said almost 50 years ago is equally appropriate to the present situation: "As a State may, for the purpose of guarding the morals of its own people, forbid all sales of lottery tickets within its limits, so Congress, for the purpose of guarding the people of the United States against the 'widespread pestilence of lotteries' and to protect the commerce which concerns all the States, may prohibit the carrying of lottery tickets from one State to another. In legislating upon the subject of the traffic in lottery tickets, as carried on through interstate commerce, Congress only supplemented the action of those States-perhaps all of them— which, for the protection of the public morals, prohibit the drawing of lotteries, as well as the sale or circulation of lottery tickets, within their respective limits. It said, in effect, that it would not permit the declared policy of the States, which sought to protect their people against the mischiefs of the lottery business, to be overthrown or disregarded by the agency of interstate commerce. We should hestitate long before adjudging that an evil of such appalling character, carried on through interstate commerce, cannot be met and crushed by the only power competent to that end. We say competent to that end, because Congress alone has the power to occupy, by legislation, the whole field of interstate commerce. What was said by this court upon a former occasion may well be here repeated: "The framers of the Constitution never intended that the legislative power of the Nation should find itself incapable of disposing of a subject matter specifically committed to its charge.' In re Rahrer, 140 U. S. 545, 562. If the carrying of lottery tickets from one State to another be interstate commerce, and if Congress is of opinion that an effective regulation for the suppression of lotteries, carried on through such commerce, is to make it a criminal offence to cause lottery tickets to be carried from one State to another, we know of no authority in the courts to hold that the means thus devised are not appropriate and necessary to protect the country at large against a species of interstate commerce which, although in general use and somewhat favored in both national and State legislation in the early history of the country, has grown into disrepute and has become offensive to the entire people of the Nation. It is a kind of traffic which no one can be entitled to pursue as of right" 188 U. S. 321, 357-358. It should be observed that the legislation passed upon in the Lottery Case is still the existing Congressional policy regarding lotteries (18 U. S. C. 1301–1303, etc.). This policy was bolstered and reiterated in 1934 by the provisions of the Communications Act forbidding the radio broadcasting of advertisements or information concerning lotteries (18 U. S. C. 1304, formerly 47 U. S. C. 316). More recently, on the subject of gambling generally, Congress in the act of April 27, 1948 (Public Law 500, 80th Cong., 62 Stat. 200), now 18 U. S. C. 1081-1083 (Public Law 72, 81st Cong., approved May 24, 1949, sec. 23), made unlawful the operation of gambling ships in American waters or of American vessels as gambling ships. Analysis of the Provisions of the Bill SECTION 1. This section defines "gambling device." A definition would probably have been unnecessary if the problem were limited only to describing a machine or mechanical device (or parts thereof, because they may be shipped unassembled or as parts for replacement or repair), “designed or adapted for gambling." The meaning of "gambling" is well understood in every jurisdiction, and no definition of it is required. However, there are a number of types of the coin-operated machines which incorporate, along with the gambling, some element of skill or return of fixed value which in the past has been argued as distinguishing them from outright gambling machines. The States have usually rejected such evasions in court decisions or by statutes drawn to meet the situations. Accordingly, the definition has been expanded along the lines of the prohibitions made by the States, incorporating the basic distinguishing element that differentiates gambling devices from legitimate vending machines, namely, the application of any element of chance in their use by which the user may become entitled to receive anything of value. (Cf. Federal tax statute relating to slot machines, 26 U. S. C. 3267 (b).) By this comprehensive definition a rather simple means of evasion otherwise afforded to manufacturers and dealers in gambling machines is greatly reduced if not eliminated. It is of course clear that ordinary vending machines and music boxes are not within the scope of the definition or the intendment of the statute. SEC. 2. This section prohibits knowingly transporting the defined gambling devices or causing them to be transported in interstate or foreign commerce; also knowingly taking, receiving, possessing, or disposing of a gambling device unlawfully transported. The prohibition does not apply to the case of unbroken interstate transportation of a machine into any State where its use is legal. In order to avoid the imposing of difficult questions of law upon Federal law-enforcement officials, common carriers, shippers, and others, it is provided that unless the Governor of the State certify as to the legality of the use of such machines in his State to the Attorney General of the United States, who will cause the certification to be published in the Federal Register, the use of the gambling devices in the State will be presumed illegal, and persons and officials affected by the act will be entitled to rely upon the presumption. It is felt that this kind of provision will minimize difficulties of interpretation and administration, and will afford private persons a fairly simple guide. If the use of the gambling devices is illegal, as it is in most of the States, there is nothing for the Governor to certify to. If the use of some or all are legal in his State, the Governor will so state, and his certification will become a matter of public record. Under the Federal Registry Act, it is contemplated that Congress may and will add to the kinds or classes of documents which may be required to be published, 44 U. S. C. 305. A savings clause is included in this section to avoid any misunderstanding that the act, and particularly the proviso in section 2 permitting unbroken transportation of gambling devices into States where their use is legal, interferes with or reduces the authority which the Federal Trade Commission has exerted under section 5 of its constituent act (15 U. S. C. 45) to exclude from the channels of interstate commerce gambling devices to be used in the sale or distribution of merchandise to the public, Federal Trade Commission v. R. F. |