2 poker arcade operators sue Zoning Board

TWO businessmen engaged in poker machine operation have sued the CNMI Zoning Board and its chairman Diego C. Blanco over the implementation of Public Law 18-5 or the Saipan Adult Machine Business Zoning Law of 2013.

The law, which takes effect on Oct. 25, 2017, mandates the relocation of poker arcades to designated commercial zoning districts and at least 200 feet away from any church, public and private school, park or playground.

Sin Ho Nam, principal shareholder of Winnerslife Inc./Sin Ho Development Inc., and Dan Bi Choi LLC, through attorney Robert Torres, are asking the Superior Court to issue a restraining order against the law.

The plaintiffs also asked the court to declare the law a violation of their due process rights.

According to the complaint, the Division of Revenue and Taxation is still issuing and renewing business licenses for gaming machines to poker arcade operators and owners currently operating outside the areas permitted by the Saipan Adult Machine Business Zoning Law of 2013.

Torres said no zoning variance or other zoning requirement is mandated for the issuances of these licenses.

Nam and Choi, Torres said, hold gaming machine and business licenses that permit the operation of duly licensed machines in Kagman and Fina Sisu through 2018.

Nam has renewed a number of licenses for gaming machines that Choi operates in Kagman and in Fina Sisu.

One of these licenses recently renewed is license 2018-P-0001 for one machine on Oct. 4, 2017 and it will expire on Oct. 4, 2018.

Torres said cutting the plaintiffs’ right to operate duly licensed businesses prior to the termination of these licenses amounts to an interference with duly protected property interests.

Cutting off their right to license their business and placing a cap on new machine licenses interferes with the plaintiffs’ right to sell gaming machines in which they have invested substantial sums to acquire, license and operate, Torres said.

He added that the commercial area in Fina Sisu and Kagman, where the plaintiffs’ machines lawfully operate, remain unaffected by current legislative proposals.

The lawyer said if the zoning board or any other arm of the CNMI government penalizes Choi for operating machines the plaintiff holds a business license to operate, Choi would be deprived of a duly protected property interest authorized by law.

Torres said if the government does not permit Nam to operate machines in which he has invested substantial sums or sell these machines to others, given the cap on new licenses, he would also be deprived of a duly protected property interest without compensation and in violation of his rights under law.

Nam holds a long-term investor visa issued by the U.S. government in Nov. 2015, Torres said.

Each machine owned by Winnerslife/Sin Ho Development expires in 2018.

Torres said the company’s business license to operate these machines expires on Jan. 1, 2018.

He said the ownership and operation of the gaming machines in Kagman and in Fina Sisu are developed under Nam’s long-term investor status.

Unless Nam invests a substantial cost to re-establish a gaming business at a new location, he and Winnerslife would be unable to operate the gambling machines for which he has expended substantial sums to acquire, Torres said.

Winnerslife would be unable to sell the gaming machines to another enterprise, given the cap on the new licenses, the lawyer added.

Torres said Nam’s E-2C investor immigration status would be compromised unless he invests and incurs these costs.

The entire foreign investor program is under review and the status of those qualified under E-2C and other business investments are targeted for expiration at the end of 2019, Torres added.

Qualification for long-term investment status is thus uncertain, he said.

Torres argued that requiring current investors to invest substantial sums in infrastructure and property development to relocate for such a short time will further cause the plaintiffs and similarly situated business significant hardship.

According to the lawsuit, the zoning office has declared that poker arcade owners and operators not in the permitted areas must shut down or pay a daily penalty fee of $1,000 unless the owners of these businesses abandon their leasehold interests and their investments in equipment and infrastructure and relocate to the designated areas on Saipan set aside for the operation of adult gambling machine businesses.

Torres said unless a temporary restraining order is issued to preclude the enforcement of the zoning law, the plaintiffs would suffer irreparable injury and harm before the defendants could be heard in opposition.

The plaintiffs face substantial fines of $1,000 a day if they continue to operate in accordance with the terms of their lawfully issued business licenses. Torres said.

Furthermore, he said the lawsuit raises questions as to law and facts.

He said because the CNMI Legislature has amended, and is continuing to amend, the Saipan Zoning Law to expand the zone of permissible commercial area for poker operation, and is also granting exceptions to specific poker establishments that did not require them to relocate, the balance of hardships tips sharply in the plaintiffs’ favor.

The Zoning Board would suffer no injury if enforcement of the zoning law is stayed pending a hearing on the issues, Torres added.

Source: Marianas Variety :

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