1 BEFORE THE GAMING COMMISSION

STATE OF MISSOURI

OPEN MEETING

JUNE 26, 2003

8 University of Missouri

School of Law

9 203 Hulston Hall, Room 112

Columbia, Missouri

14 COMMISSION MEMBERS: ROBERT SMITH, Chairman

FLOYD O. BARTCH

15 JUDITH SUTTER-HINRICHS

JACK GANT

20 REPORTED BY:

21 STEPHANIE L. KURTZ MORGAN, RPR, CCR

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22 714 West High Street

P. O. Box 1308

23 Jefferson City, Missouri 65102

(573) 636-7551

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1 I N D E X

I. Call to Order 4

II. Consideration of Minutes

4 A. April 29, 2003 4

B. May 13, 2003 5

III. Consideration of Hearing Officer

6 Recommendations

C. William F. Dilley 6

7 1. Resolution No. 03-055

D. William E. Fry 9

8 1. Resolution No. 03-056

E. Jeanie Libel 30

9 1. Resolution No. 03-057

F. Ingrid G. Smith 37

10 1. Resolution No. 03-058

G. Leona A. Yardley 39

11 1. Resolution No. 03-059

12 IV. Consideration of Relicensure of Certain

Class A Licensees

13 H. Mark Twain Casino, L.L.C 43

1. Resolution No. 03-060

V. Consideration of Certain Level I/Key Applicants

15 I. Resolution No. 03-061 73

16 VI. Presentation of New GIR/NOV/Discipline Process

VII. Consideration of Rules & Regulations

18 J. Proposed Amendment

1. 11 CSR 45-13.010 - 121

19 All Types of Hearings

2. 11 CSR 45-13.020 - 123

20 Hearing Officer

3. 11 CSR 45-13.030 - 128

21 Requests for Hearings

4. 11 CSR 45-13.045 - 131

22 Suitability Hearings for

Gaming Applicants and Exclusion

23 Hearings

5. 11 CSR 45-13.050 - 133

24 Disciplinary Actions

Against Gaming Licensees

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1 I N D E X (CONTINUED)

6. 11 CSR 45-13.051 - 136

3 Bingo Hearings

7. 11 CSR 45-13.060 - 137

4 Proceedings

8. 11 CSR 45-13.070 - 139

5 Transmittal of Record and

Recommendation to the Commission

6 9. 11 CSR 45-13.080 - 149

Prohibition of

7 Ex Parte Communications

8 VIII. Legislative Update

9 IX. Closed Session

10 X. Adjournment 162

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1 P R O C E E D I N G S

2 CHAIRMAN SMITH: I get a chance to tell all of

3 you lawyers to sit down and keep quiet. I won't get a

4 chance to do that again.

5 COMMISSIONER GANT: I get to do that all the

6 time.

7 CHAIRMAN SMITH: That's right. Well, if you

8 call the roll -- where are you, Angie?

9 MS. ANGIE FRANKS: Chairman Smith?

10 CHAIRMAN SMITH: Present.

11 MS.FRANKS: Commissioner Bartch?

12 COMMISSIONER BARTCH: Present.

13 MS. FRANKS: Commissioner Hinrichs?

14 COMMISSIONER HINRICHS: Present.

15 MS. FRANKS: Commissioner Gant?

16 COMMISSIONER GANT: Present.

17 CHAIRMAN SMITH: Welcome everybody to the law

18 school on behalf of the Gaming Commission.

19 And let's see, the first order of business is the

20 consideration of the minutes of the meeting of

21 April 29, 2003.

22 Any corrections?

23 COMMISSIONER HINRICHS: I would move that we

24 approve those minutes.

25 CHAIRMAN SMITH: Motion to approve the

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1 minutes.

2 Is there a second?

3 COMMISSIONER GANT: Second.

4 CHAIRMAN SMITH: Call roll.

5 MS. FRANKS: Chairman Smith?

6 CHAIRMAN SMITH: In favor.

7 MS. FRANKS: Commissioner Bartch?

8 COMMISSIONER BARTCH: Favor.

9 MS. FRANKS: Commissioner Hinrichs?

10 COMMISSIONER HINRICHS: Favor.

11 MS. FRANKS: Commissioner Gant?

12 COMMISSIONER GANT: Favor.

13 MS. FRANKS: By your vote you've adopted the

14 minutes of the April 29, 2003 meeting.

15 CHAIRMAN SMITH: Next one is consideration of

16 minutes of May 13, 2003. Anybody have any

17 corrections on those minutes?

18 COMMISSIONER GANT: I move they be approved.

19 CHAIRMAN SMITH: We have a motion to approve

20 the minutes of May 13, 2003.

21 Is there a second?

22 COMMISSIONER HINRICHS: Second.

23 CHAIRMAN SMITH: Call roll.

24 MS. FRANKS: Chairman Smith?

25 CHAIRMAN SMITH: In favor.

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1 MS. FRANKS: Commissioner Bartch?

2 COMMISSIONER BARTCH: Favor.

3 MS. FRANKS: Commissioner Hinrichs?

4 COMMISSIONER HINRICHS: Favor.

5 MS. FRANKS: Commissioner Gant?

6 COMMISSIONER GANT: Favor.

7 MS. FRANKS: By your vote you've adopted the

8 minutes of the May 13, 2003 meeting.

9 CHAIRMAN SMITH: Okay. The next item of

10 business is consideration of hearing officer

11 recommendations. This is the Thad McCanse show today, I

12 notice.

13 MR. THAD McCANSE: I'll try to make it brief and

14 enlightening, I guess.

15 CHAIRMAN SMITH: Well, we would hope so.

16 MR. McCANSE: In the first case --

17 CHAIRMAN SMITH: You've started on an unusual

18 day.

19 MR. McCANSE: This is a case where -- I

20 think all of these cases today were re-assigned after

21 Hearing Officer Yost had left the Commission employment

22 and been on his own. These cases were assigned to me

23 and they're all pretty old.

24 The first one we had quite a bit of

25 correspondence with, Mr. Dilly, who wanted a telephone

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1 hearing because he was out in New Mexico, I believe.

2 But when we got to finally looking at the

3 records, we discovered that the action to revoke his

4 license started after his license had already been

5 terminated -- it had already expired.

6 So Mr. Bradley, on a motion to dismiss, decided

7 Hearing Officer Kevin Mullally's decision in Struse

8 (phonetic sp.) v. Missouri Gaming Commission -- and

9 he said that there was no jurisdiction. And I agree.

10 I wasn't going to disagree with Mr. Mullally

11 anyhow, but he's entirely right.

12 CHAIRMAN SMITH: This is the first time --

13 Mike said it's the first time that his decisions have

14 ever come up here as precedent, so I'm glad that they

15 finally found one that you can rely on.

16 MR. KEVIN MULLALLY: He looked long and hard.

17 MR. McCANSE: But this is a

18 jurisdictional matter. We don't have any authority

19 over the man since he was not -- did not have a license

20 at the time we started the action to revoke it.

21 So I have asked that the motion to dismiss be

22 sustained on jurisdictional grounds.

23 CHAIRMAN SMITH: Any questions concerning this

24 particular matter?

25 (No response.)

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1 CHAIRMAN SMITH: I just had one question, just

2 more of a procedural one. As I understand, this person

3 didn't appear and the ruling is made.

4 And what procedure do we have if someone

5 doesn't attend a hearing? How are they notified of the

6 decision of the hearing officer and the Commission?

7 MR. MULLALLY: I'll let Mike Bushmann, General

8 Counsel, speak to that. We've had a change in

9 procedure there.

10 MR. MIKE BUSHMANN: Well, the --

11 CHAIRMAN SMITH: Is the applicant notified of

12 the decision?

13 MR. BUSHMANN: We would attempt to.

14 CHAIRMAN SMITH: Yeah, I mean, at least send a

15 letter to their last address -- that procedure?

16 MR. BUSHMANN: We would use the address that

17 we have on file.

18 CHAIRMAN SMITH: And look at that.

19 That's done in each case then?

20 MR. BUSHMANN: Yes, that is.

21 CHAIRMAN SMITH: Okay.

22 MR. McCANSE: The next -- oh, I'm sorry.

23 You're --

24 CHAIRMAN SMITH: We need to rule on this one.

25 Do we have a motion either to adopt

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1 Resolution 03-055 affirming the hearing officer's award

2 or --

3 COMMISSIONER GANT: I so move.

4 CHAIRMAN SMITH: There's a motion.

5 Second?

6 COMMISSIONER HINRICHS: Second.

7 CHAIRMAN SMITH: Looks like this is pretty cut

8 and dried.

9 Let's call roll.

10 MS. FRANKS: Chairman Smith?

11 CHAIRMAN SMITH: In favor.

12 MS. FRANKS: Commissioner Bartch?

13 COMMISSIONER BARTCH: Favor.

14 MS. FRANKS: Commissioner Hinrichs?

15 COMMISSIONER HINRICHS: Favor.

16 MS. FRANKS: Commissioner Gant?

17 COMMISSIONER GANT: In favor.

18 MS. FRANKS: By your vote you've adopted

19 Resolution No. 03-055.

20 MR. McCANSE: And the next case,

21 William E. Fry, there's the same jurisdictional

22 problem, which unfortunately came up at the end of the

23 somewhat lengthy hearing.

24 Fry was actually terminated, and the

25 Commission charged him with commission of the crime,

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1 because he had received $640 to pay a jackpot and they

2 couldn't account for it. But his license had

3 expired, I think, a few days before the action to

4 revoke his license had started.

5 So, again, it's similar to the Dillie case in

6 that we had no jurisdiction. The problem in this case

7 is that Mr. Fry has vigorously defended himself

8 in this matter.

9 And I spent quite a bit of time, and the

10 hearing was kind of lengthy, too.

11 CHAIRMAN SMITH: I assume that was before you

12 discovered the jurisdictional problem?

13 MR. McCANSE: Yeah -- well,

14 even afterwards, because I thought it -- he had his

15 attorney call me the other day. He said, I don't want

16 to influence any decision you might make. I just

17 wondered where it stood. So he's still

18 actively trying to clear his name.

19 There was a videotape of the cashier's booth

20 that was taken from two angles. One of them taken from

21 above very clearly shows that he received $640.

22 But what happened was that where there's a

23 jackpot machine -- where the machine itself doesn't pay

24 the coins, they have a person on the floor who the

25 machine will print out a slip and there'll be a request

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1 to pay it.

2 And he will take -- he carries a few thousand

3 dollars in his wallet. He pays the lucky person the

4 amount of the jackpot, collects the paperwork, turns it

5 in to the cashier to reload his wallet at the end of

6 his shift -- or at least to make it balance.

7 The only $640 that they could connect to Fry

8 had a receipt that was a month old and not signed by

9 him. And it was a machine printout slip

10 with somebody else's signature on it.

11 Obviously it did not apply to the jackpot in

12 question. This happened in October and that slip was

13 in September, I think.

14 The video, though, showed that when Fry went

15 up to the cashier's cage, he handed the paperwork to

16 the cashier. She looked at it and pushed it back to

17 him. And he glanced at it and pushed it back to her,