New regulations may not force closure of cyber cafes

Date: 7/11/2011

July 11, 2011

By G. Michael Dobbs

Managing Editor

SPRINGFIELD — If people thought the issuance of permanent regulations banning cyber cafés that offer a sweepstakes put the controversy to rest, guess again. According to City Solicitor Edward Pikula, the regulations will not necessarily close the cyber cafés open in the city.

Attorney General Martha Coakley released a statement recently announcing a permanent ban on “illegal gambling” taking place in the cyber cafés was in place.

The regulations were first announced as temporary earlier in the year and were made permanent.

“This regulation will enforce long-standing gambling laws and protect consumers,” Coakley said. “The regulation makes clear that companies cannot skirt our laws by disguising gambling as something else, such as the sale of Internet access. These establishments were illegal when they started, and they are illegal now.”

Coakley’s spokesperson, Harry Pierre, told Reminder Publications the regulations are aimed at any business “using a ruse” to get around state gambling laws.

“It’s putting them on notice,” he added. Those businesses that violate the law may be subject to injunctions, civil penalties and other relief under the Consumer Protection Act.

The attorney general’s staff would enforce the regulations, Pierre explained.

The regulations, though, are not stopping the Triple Seven Cyber Center at 296 Cooley St. from pursuing a special permit from the city that would allow it to stay in business using all of its computer terminals. Presently it can use only five of them.

Pikula said the city has received notice of an appeal for the decision made by the City Council on May 20 to deny the special permit the business sought.

Triple Seven was one of seven such cyber cafés that opened in the city. Pikula said of those seven businesses, one closed, while three others initially sought to apply for a special permit. Of those three, Triple Seven went forward with the process, while the other two asked for a continuance. The three other businesses ignored the legal process the city defined and there are court cases pending against them, he added.

The need for a special permit came after a determination the businesses needed a common victualer’s license to serve food and an entertainment license. After investigations by the Police Department and the Law Department, the city determined there was no illegal gambling at the businesses. Zoning regulations, though, required a special permit because of the number of computers — deemed as entertainment devices — at the business, Pikula said.

At the May 20 meeting of the City Council, the councilors voted only four in favor of the special permit. City Councilor Tim Rooke made a successful motion to reconsider the permit at the June 6 meeting where it was approved.

City Clerk Wayman Lee asked for a clarification and Pikula said the vote denying the special permit was valid, as state law stipulates a special permit can not be considered a second time within two years unless there are “substantial” differences in the business seeking the special permit.

“What is ‘substantially materially different’ is up to the City Council,” Pikula said.

He noted the original special permit carried no conditions. If conditions were added, the argument could be made that the special permit was altered enough to meet the legal standard, he said.

The appeal, filed by Attorney Richard Maggi, asked for affirmation for the second vote that approved the permit and award Jennifer Burritt, the owner of the business and the plaintiff, “damages, plus costs and fees.”

Coakley’s office defined the cafés by the following: “The so called ‘cyber cafés’ feature dozens of computer screens at which patrons play video slot machines, lotteries, or similar games where the winning numbers are revealed each time the player uses game credits — or money — to play the game. Gamblers typically pay for a swipe card — for example, 1,000 points for $10 — and use their points to play the lottery, sweepstakes or video slots. If they win, they can redeem the points accrued on their swipe card for cash. More often, they play until their money is exhausted, and then stop or pay more money to keep playing.

“These establishments purport to sell Internet time, coupled with the opportunity to win prizes in a lottery, sweepstakes, or video slots. But, the Attorney General Office’s investigation found that sale of Internet time is a ruse, as virtually all customers pay money to gamble, and that is how the establishments are promoted.”