Monday, Sep. 28, 2009

Bingo fight lights up over smoking ban

Two competitors sue each other

Bingo parlors on opposite ends of Richland County are suing each other, claiming their competitors are ignoring a county law that prohibits smoking.

The two - Carolina Gold Bingo on Decker Boulevard and Mr. Bingo on St. Andrews Road - have hired well-known lawyers, as well as private investigators to spy on each others' customers.

At the heart of the dispute is Richland County Council's indecision about how vigorously to enforce a law that has generated few reports of violations and carries just a $25 fine.

Opposing each other in back-and-forth allegations of unfair competition are Columbia defense lawyer Joe McCulloch and James Smith, a local legislator who recently ruled out a run for governor.

McCulloch represents Carolina Gold owner Wayne Kirby, who opened his "mom and pop" bingo operation in June 2008.

Kirby said he thought there was room in the market for an upscale bingo hall.

"I like to go to Vegas, so I said, 'We're going to bring Vegas atmosphere to Columbia, South Carolina.'"

He put in flat-screened TVs, special lighting and a ventilation system allowing him to separate his smoking customers behind a glass partition.

Then the county passed a smoking ban.

That prompted Kirby to petition council to amend that ban, to exempt businesses like his with separate heating-and-air systems for smokers.

But health advocates convinced council to defeat that proposal earlier this month.

The lengths to which the bingo parlors are going hints at the lucrative and competitive nature of the business.

The two parlors - among four total in Richland County - each grossed more than $700,000 last year. Carolina Gold was only open part of the year.

The operators don't keep all the profits, though.

Under state law, bingo games must benefit "fraternal, religious or charitable organizations," said Adrienne Fairwell, a spokeswoman for the S.C. Department of Revenue.

However, the state agency is not privvy to the individual contracts that set out how much of the net proceeds a promoter shares with a nonprofit group, she said.

And McCulloch and Smith each said they didn't know.

In May, Kirby was sued by Smith's client, Mr. Bingo, on St. Andrews Road. The company has a Texas-based owner, which Smith characterized as a "professional and sophisticated operator" of bingo games.

The lawsuit said Carolina Gold was allowing people to smoke "for the purpose of increasing their market share and harming ... competitors."

The company's violations were "so frequent and pervasive" that no one else in the industry could compete unless they were to break the no-smoking law, too, the suit said.

Indeed, one of the documents in the court file reveals other businesses are allowing their customers to smoke.

A private investigator hired by McCulloch went by three of the county's bingo parlors one night, using his cell phone to take pictures of people smoking while they played bingo.

One of the places the investigator visited was a bingo hall right next door to Mr. Bingo.

Now, McCulloch has counter-sued, charging that Mr. Bingo made an arrangement with the tenant next door allowing smokers to step over there whenever they need a cigarette.

"It seemed odd to us, and meaningful to us, that the plaintiff would bring suit against a competitor across town - but not all competitors," McCulloch said.

Smith said Mr. Bingo does not allow smoking and, to his knowledge, neither does the place next door. The businesses are owned by the Littlefield Corp. and one of its subsidiaries.

But all this could be avoided if Richland County started ticketing violators of its no-smoking law, which went on the books 10 months ago.

Since then, just 21 complaints have been lodged - 11 of them involving people lighting up at county bingo parlors.

So far, the county has issued warnings but no tickets.

"If they're not going to enforce it, why have it?" asked Tom Sponseller, director of the S.C. Hospitality Association, who said allowing some businesses to ignore the law does set up a system of unfair competition.

County administrator Milton Pope has asked the council on more than one occasion to make time to hash out enforcement issues - like how many violations it would take before the county yanks a business license.

But Councilman Bill Malinowski said one of his biggest concerns in citing a business is that an underhanded entrepreneur could put a competitor out of business just by making a habit of going into their place and smoking.

Sponseller said cities and counties around the state have different approaches on who takes the blame if someone gets caught smoking at a business.

"Some cities and counties penalize the smoker. Some penalize the smoker and the business," he said. "Some only penalize the business."

Smith, representing Mr. Bingo, said without county enforcement there's no mechanism to get competitors to follow the law.

"The ordinance as a policy decision is a good one," Smith said. "It needs teeth to ensure it's enforced.

"The good news is the vast majority of businesses in the county are following the law."

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