Summary
The Alaska Supreme Court held that the attorney general may assert charitable organizations' damages claims against gaming operators without the organizations' consent when the organizations have dismissed or compromised claims for less than they were owed under Alaska's gaming laws. The court concluded that the attorney general's charitable-trust enforcement authority supplied standing and that the affected charities were not necessary parties under Civil Rule 19(a). The court reversed the superior court's grant of summary judgment for the defendants.
Topics
Practice areas
Questions Presented
- Whether the attorney general had standing and authority to sue to enforce Alaska's gaming laws notwithstanding the Department of Revenue's administrative authority.
- Whether the attorney general could assert a charity's damages claim against a third party without the charity's consent when the charity had dismissed or compromised the claim for less than it was entitled to receive under Alaska's gaming laws.
- Whether the evidence created a genuine issue of material fact as to whether the charities had dismissed or compromised their claims for less than they were owed.
- Whether the charities that had withdrawn from the litigation were necessary parties under Alaska Civil Rule 19(a).
Holdings
- The attorney general has authority to bring an action to enforce Alaska's gaming laws because the attorney general's statutory and common-law authority to prosecute violations was not displaced by the Department of Revenue's administrative authority.
- When a charity dismisses or compromises a claim against a third party for less than the charity is due under Alaska's gaming laws, the attorney general may assert the charity's cause of action without the charity's consent.
- Summary judgment for the Griffins was improper because the record contained evidence from which a factfinder could conclude that the charities' claims were dismissed or compromised for less than the charities were entitled to receive.
- The charities that had withdrawn from the action were not necessary parties under Civil Rule 19(a).
Key quotations
“Accordingly, we hold that the attorney general's authority to enforce charitable trusts gives him the power to assert the charities' damages claims against the Griffins.” (693-94)
“Where a charity dismisses or compromises a claim against a third party for less than it is due to receive under the state's gaming laws, the attorney general's authority to enforce charitable trusts gives him the power to assert the charity's cause of action.” (696)
“Accordingly, we hold that the attorney general may pursue a damages claim against the Griffins without the consent of the affected charities, and REVERSE the superior court's grant of summary judgment.” (696)
Factual background
Alaska law permits qualified organizations to conduct charitable gaming through multiple-beneficiary permittees. Sue Griffin managed the gaming operations of two such entities, while Mark Griffin owned Alaska Bingo Supply, which supplied gaming materials and leased facilities to them. The State alleged that the Griffins failed to distribute the statutory minimum percentage of gaming proceeds and charged excessive fees and rents; several charities withdrew from or settled their claims, allegedly for less than they were owed. Evidence also supported an inference that the charities' claims had been compromised or abandoned under circumstances involving pressure or retaliation.
Procedural history
The attorney general sued the Griffins and related entities, alleging violations of Alaska gaming laws, including failure to distribute required gaming proceeds and charging excessive fees and rents. After most affected charities dismissed or compromised their claims, the superior court ruled that the attorney general could not pursue monetary damages claims for charities that had not consented to the action and granted summary judgment to the Griffins. The Alaska Supreme Court reversed.
Remand instructions
The superior court's grant of summary judgment for the Griffins is reversed, allowing the attorney general to pursue the damages claims on behalf of the affected charities.