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TELEPHONE NEWS SYSTEM, INC. v. ILL. BELL TEL. CO.

August 14, 1963

TELEPHONE NEWS SYSTEM, INC., AN ILLINOIS CORPORATION, PLAINTIFF,
v.
ILLINOIS BELL TELEPHONE COMPANY, AN ILLINOIS CORPORATION, DEFENDANT, UNITED STATES OF AMERICA, INTERVENOR-DEFENDANT.



Before Hastings, Circuit Judge, and Julius J. Hoffman and Will, District Judges.

The opinion of the court was delivered by: Julius J. Hoffman, District Judge.

    Since 1956, plaintiff, Telephone News Systems, Inc., has operated a telephone service supplying certain horse racing information to anyone calling its telephone number. Plaintiff receives the information over a "Sports Printer" leased from United Press International News Service and makes voice recordings several times a day, which recordings are heard by those calling plaintiff's number. (See Telephone News System, Inc. v. Illinois Bell Tel. Co., 210 F. Supp. 471 (N.D. Ill. 1962), an earlier opinion in this case.)

On April 25, 1962, Herbert J. Miller, Jr., Assistant Attorney General in charge of the Criminal Division of the Department of Justice, sent a letter to the Illinois Bell Telephone Company representing that information in the files of the Department of Justice revealed that telephone facilities located at plaintiff's place of business were being and would be used for transmitting and receiving gambling information in violation of federal law. The letter stated that pursuant to title 18 U.S.C. § 1084(d), the telephone company was required to discontinue the leasing of these facilities, after reasonable notice to the subscriber; it suggested that five days' notice would constitute reasonable notice under the circumstances. On April 27, 1962, the telephone company notified plaintiff by letter that in compliance with the Department of Justice directive, plaintiff's telephone service would be discontinued on May 5, 1962. Plaintiff instituted this proceeding on May 4, 1962, praying that the Illinois Bell Telephone Company be enjoined from discontinuing service to plaintiff. The United States of America, alleging that it is the real party in interest, has been allowed to intervene as a defendant. Pending a final determination of plaintiff's prayer for a permanent injunction, this Court entered a temporary restraining order preventing removal of plaintiff's telephone facilities.

The case was submitted to the Court on the pleadings, stipulations of facts, and documents admitted into evidence. After hearing arguments and examining the briefs filed by counsel, the Honorable Hubert L. Will found that plaintiff was using its telephone facilities in violation of section 28-1(a)(10) of the Illinois Criminal Code of 1961, Ill. Stat. Ann. c. 38, § 28-1(a)(10) (1961), and that consequently discontinuation of its telephone service was required by title 18 U.S.C. § 1084(d). Telephone News System, Inc. v. Illinois Bell Telephone Co., supra. The Court further determined, however, that plaintiff had raised a substantial question concerning the constitutionality of section 1084(d) and, pursuant to title 28 U.S.C. § 2282, 2284, directed that a three-judge court be convened to consider the constitutional objections raised by plaintiff.

Section 1084(d) provides as follows:

Section 28-1(a)(10) of the Illinois Criminal Code provides that a person commits illegal gambling when he

    "[k]nowingly transmits information as to
  wagers, betting odds, or changes in betting odds
  by telephone, telegraph, radio, semaphore or
  similar means; or knowingly installs or maintains
  equipment for the transmission or receipt of such
  information."

Plaintiff contends that both of these provisions violate the United States Constitution.

I. CONSTITUTIONALITY OF § 1084(d)

The plaintiff asserts that section 1084(d) is unconstitutional (1) because of vagueness, (2) because it authorizes the prosecution of crimes under the guise of a civil remedy, and (3) because it deprives the telephone subscriber of its remedies for wrongful termination of service.

1. Contention That Provision Is Void Because of Vagueness

Plaintiff contends that section 1084(d) creates a hitherto unknown offense of transmitting or receiving "gambling information" over wire communication facilities, and that neither the section itself nor the statute as a whole supplies any standards for determining what constitutes "gambling information," but delegates the definition of this term to the agencies charged with enforcement of this provision. Plaintiff, quoting from, Connally v. General Construction Co., 269 U.S. 385, 391, 46 S.Ct. 126, 127, 70 L.Ed. 322 (1926), asserts that "men of common intelligence must necessarily guess at its meaning and differ as to its application." Plaintiff asserts that the term can include almost any type of information, including, for example, the physical condition of a hockey team, the weather conditions on the day of a football game, or "stale" information about a sporting event or contest.

A statute is void where it is so vague as to embrace acts which it is unreasonable to presume were intended to be made subject to its sanctions. Cf. Herndon v. Lowry, 301 U.S. 242, 258-259, 57 S.Ct. 732, 81 L.Ed. 1066 (1937). The difficulty with plaintiff's argument is that plaintiff incorrectly assumes that section 1084(d) creates an offense of transmitting or receiving gambling information in interstate or foreign commerce. This provision, however, creates no offense. Whether the transmission or receiving of information about the weather or the physical condition of a team prior to a sporting event is a crime under given circumstances is to be determined not by reference to the term "gambling information" in this provision, but by reference to federal, state, and local criminal laws which proscribe the sending or receiving of gambling information over wire communications facilities. Section 1084(d) provides for discontinuation of communication services that are put to certain unlawful uses.

The fifth amendment forbids the taking of property without due process of law. It seems probable that one's right to telephone service is a property right within the protection of this amendment, inasmuch as under the common law and most utility statutes a public utility must serve all members of the public without unreasonable discrimination. See Andrews v. Chesapeake & Potomac Tel. Co., 83 F. Supp. 966 (D.D.C. 1949); Fay v. Miller, 87 U.S.App.D.C. 168, 183 F.2d 986 (1950). The requirement of due process includes the requirement that a statute penalizing conduct must give fair notice of what conduct is proscribed, or it is void for "indefiniteness." Winters v. New York, 333 U.S. 507, 524, 68 S.Ct. 665, 92 L.Ed. 840 (1948) (Frankfurter, J., dissenting).

The concept of vagueness or indefiniteness is most often employed with respect to criminal provisions. The requirement as applied to a criminal statute has been described by the United States Supreme Court, in a frequently quoted passage, as follows:

    "A criminal statute must be sufficiently
  definite to give notice of the required conduct
  to one who would avoid its penalties, and to
  guide the judge in its application and the lawyer
  in defending one charged with its violation. But
  few words possess the precision of mathematical
  symbols, most statutes must deal with untold and
  unforeseen variations in factual situations, and
  the practical necessities of discharging the
  business of government inevitably limit the
  specificity with which legislators can spell out
  prohibitions. Consequently, no more than a
  reasonable degree of certainty can be demanded.
  Nor is it unfair to require that one who
  deliberately goes perilously close to an area of
  proscribed conduct shall take the risk that he
  may cross the line." Boyce Motor Lines, Inc. v.
  United States, 342 U.S. 337, 340, 72 S.Ct. 329,
  330, 331, 96 L.Ed. 367 (1952). (Footnotes
  omitted.)

With regard to non-criminal provisions, the Court has said, "The standards of certainty in statutes punishing for offenses is higher than in those depending primarily upon civil sanctions for enforcement." Winters v. New York, 333 U.S. 507, 515, 68 S.Ct. 665, 670, 92 L.Ed. 840 (1948).

In examining a statutory provision challenged as vague and indefinite, the federal courts must determine whether the provision contains sufficient standards to identify the conduct to which the penalty applies, and in so doing the court is guided by the provision itself as read in the context of the entire statute, and by the nature of the subjects with which the statute is concerned. Connally v. General Construction Co., 269 U.S. 385, 391-392, 46 S.Ct. 126, 70 L.Ed. 322 (1926). Moreover, the court, in maintaining a proper perspective of its role in the review of legislation challenged as unconstitutional, must appreciate that the drafting of legislation calls for a type of judgment "peculiarly within the responsibility and the competence of legislatures." Winters v. New York, 333 U.S. 507, 526, 68 S.Ct. 665, 675, 92 L.Ed. 840 (1948) (Frankfurter, J., dissenting). Accordingly, the language of Congress is not easily held "indefinite." It is appropriate to consider what problem Congress was dealing with, in enacting the provision in question, and why Congress chose the language enacted. Cf., Boyce Motor Lines v. United States, 342 U.S. 337, 341-342, 72 S.Ct. 329, 96 L.Ed. 367 (1952).

Section 1084(d) gives fair notice of the type of conduct which will give rise to the discontinuation of telephone service. It contains sufficient standards to show what type of criminal offense will give rise to its application.

The statute in which subsection (d) appears provides some indication of what Congress had in mind in using this term. Subsection (a) of Section 1084 provides as follows:

    "Whoever being engaged in the business of
  betting or wagering knowingly uses a wire
  communication facility for the transmission in
  interstate or foreign commerce of bets or wagers
  or information assisting in the placing of bets
  or wagers on any sporting event or contest, or
  for the transmission of a wire communication
  which entitles the recipient to receive money or

  credit as a result of bets or wagers, or for
  information assisting in the placing of bets or
  wagers, shall be fined not more than $10,000 or
  imprisoned not more than two years, or both."

In this subsection, Congress gave a specific example of the kind of criminal offense it meant to comprise in subsection (d).

Subsection (b) of this section specifically exempts certain types of transmissions — those of information for use in news reporting and those sent from a state where the betting is legal to another state where betting is legal.

The legislative history of section 1084 clearly shows the evil which Congress meant to suppress by this provision. The House Committee on the Judiciary reported, with respect to this section, as follows:

    "Testimony before your Committee on the
  Judiciary revealed that modern bookmaking depends
  in large measure on the rapid transmission of
  gambling information by wire communication
  facilities. For example, at present the immediate
  receipt of information as to results of a
  horserace permits a bettor to place a wager on a
  successive race. Likewise, bookmakers are
  dependent upon telephone service for the placing
  of bets and for layoff betting on all sporting
  events. The availability of wire communication
  facilities affords opportunity for the making of
  bets or wagers and the exchange of related
  information almost to the very minute that a
  particular sporting event begins."

The Committee further stated,

    "The purpose of the bill is to assist the
  various States and the District of Columbia in
  the enforcement of their laws pertaining to
  gambling, bookmaking, and like offenses and to
  aid in the suppression of organized gambling
  activities by prohibiting the use of wire
  communication facilities which are or will be
  used for the transmission of bets or wagers and
  gambling information in interstate and foreign
  commerce." H.R. Rep. No. 967, 87th Cong., 1st
  Sess. (1961), U.S. Code Congressional and
  Administrative News 1961, p. 2631.

Thus, the principal problem with which Congress was dealing was the suppression of professional gambling activities. It has often been stressed in recent years that the threat of organized crime is difficult to combat on the state or local level, because it frequently crosses jurisdictional lines. Johnson, Organized Crime: Challenge to the American Legal System (Part I), 53 J.Crim.L., C. & P.S. 399, 418-19 (1962). And its communications are often beyond the reach of state and local law enforcement, because they are frequently interstate. Id., (Part II), 54 J.Crim.L., C. & P.S. 1, 27 (1963). Organized gambling, particularly bookmaking, is highly dependent upon rapid communications. ABA Report on Organized Crime and Law Enforcement 84 (1952); Bachelder, The Suppression of Bookie Gambling by a Denial of Telephone and Telegraph Facilities, 40 J.Crim.L., C. & P.S. 176 (1949). Thus Congress considered that denial of wire communication facilities to support such gambling activities would be an effective way to curtail such activities.

The states, as well as the federal government, have employed regulation of communication facilities as a means to curtail professional gambling activities, particularly off-track betting, and a number of states have enacted statutes or adopted administrative procedures to prohibit the transmission of information with intent that it be used in a gambling operation, to ban racing information for a given period of time after a race, or to deny wire services where the services are used to further commercial gambling activities. Johnson, (Part II), supra at 27; Bachelder, supra.


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