STATE OF ARIZONA v. RANDALL LEONARD (2025)

OPINION

¶1 The State appeals the dismissal of criminal charges against Defendants Gregory Mullally, Randall Leonard, and Frank Meyer arising from the distribution and use of gaming devices (“Lynxx Devices”) created by Lynxx Gaming, Inc. (“Lynxx Gaming”). The superior court found the Lynxx Devices are capable of both regulated and unregulated gambling and dismissed the charges. Because the Lynxx Devices’ unregulated uses make dismissal of the charges error, we reverse and remand.

FACTS AND PROCEDURAL HISTORY

A. After the Defendants Lease Lynxx Devices, a Grand Jury Indicts Them for Illegal Control of an Enterprise and Promotion of Illegal Gambling.

¶2 Between September 2019 and July 2020, Lynxx Gaming leased the Lynxx Devices, marketed and designated as Bingo Technological Aids (“BTAs”), to non-profit bingo operators. Arizona law allows bingo operators to offer players BTAs “that function only as electronic substitutes for bingo cards and shall reserve at least two ․ for use by players with disabilities.” A.R.S. § 5-406(X)(1).

¶3 Each Lynxx Device is “a monitor in a cabinet.” The cabinet contains a card reader to identify players, who need a Lynxx gaming card to use the device, and a bill acceptor for the player to buy bingo cards for the monitor to display. When the game begins, the Lynxx Device displays a small five-by-five bingo card. To start playing, the player makes a bet and the Lynxx Devices’ software picks up to 30 bingo balls. As the Lynxx Device draws bingo balls, it marks the player's card and reels on the touch screen monitor begin to spin. The reels stop spinning if the player achieves a winning bingo pattern. Several different patterns are winners and each winning pattern has a corresponding value. If the player wins, the game pays the player the prize amount they earned based on which winning pattern they achieved.

¶4 Lynxx Devices can be played in two different ways. First, a single player can play a Lynxx Device, competing against the machine. In single-player mode, sometimes the player loses the game and the Lynxx Device wins. Second, a group of players, each at a separate Lynxx Device linked with the others, can compete against each other to see who gets a winning pattern from the bingo balls drawn. In multi-player mode, each player sees the same draw of bingo balls, and there is always a player who wins.

¶5 After an investigation, the Arizona Department of Gaming determined it had reason to believe the Lynxx Devices functioned as illegal slot machines. In 2023, a grand jury indicted Defendants, who were employees and managers of Lynxx Gaming, for illegally controlling an enterprise that promoted illegal gambling in violation of A.R.S. §§ 13-2312(A), -2301, -701, -702, and -801.¹ The indictment is eight pages and lists the alleged crimes—illegal control of an enterprise and promotion of gambling, totaling 15 counts. It also alleges a date and location for each charge.

¶6 While the indictment does not mention the Lynxx Devices, the parties all understand that the Lynxx Devices are the subject of the charges in the indictment because Lynxx Gaming's only activity is leasing Lynxx Devices. The indictments in substance allege that Defendants committed promotion of gambling and illegal control of an enterprise by leasing the Lynxx Devices to numerous non-profits.

B. The Superior Court Dismisses the Indictment.

¶7 Mullally moved to dismiss the indictment under Arizona Rule of Criminal Procedure (“Rule”) 16.4(b); Leonard and Meyer joined him. Far from questioning that the indictment did not expressly reference the Lynxx Devices, Defendants’ motion to dismiss parsed how the Lynxx Devices operated, thus showing that Defendants correctly understood the charges to arise from Lynxx Gaming's leasing of Lynxx Devices. Defendants’ motion argued they could not be guilty of illegal control of an enterprise, see A.R.S. § 13-2312(A), because they did not engage in the predicate act of the promotion of gambling under A.R.S. § 13-3303. They could not be guilty of promotion of gambling, they argued, because: A.R.S. §§ 13-3302 and -3303(A) exempt regulated gambling from prosecution; the Lynxx Devices offer bingo; and bingo is regulated by A.R.S. §§ 5-401 to - 415. Defendants also argued the legislature intended to exempt all bingo—even bingo that violates the bingo statutes—from prosecution under the promotion of gambling statute. Finally, they argued the legislature meant for the bingo violations statute, A.R.S. § 5-410, which makes knowing violations of the bingo statutes a class 3 misdemeanor to be the only possible charge for bingo as a violation of Arizona law.

¶8 The State responded that the Lynxx Devices cannot be considered regulated bingo under Arizona law. It contended the Lynxx Devices offer “instant bingo,” which is not regulated in Arizona and thus not exempt from the promotion of gambling charges. The State also argued that the Lynxx Devices are not BTAs under A.R.S. § 5-406(X).

¶9 After oral argument, the superior court dismissed the indictment without prejudice. The court explained its analysis hinged on whether the Lynxx Devices were more like a slot machine or more like bingo. The court relied on facts the parties alleged in their briefs and on Defendants’ representations at oral argument about how the Lynxx Devices functioned. It found that when played with a single player, “the player either wins or loses, much the same as a slot machine.” But when linked in multi-player mode, “there is a winner to every game, much the same as [b]ingo.” The court analogized the two modes to playing with cards, in that cards can be used in legal games but also for illegal purposes. The court then concluded, “[t]here are aspects to the Lynxx [Devices’] design that allow for what would be illegal use, such as not linking multiple players to a common set of random numbers.” Because the Lynxx Devices are capable of a multi-player mode where the devices are linked, which is more akin to bingo, the superior court dismissed the indictment, finding the Lynxx Devices offer regulated gambling excepted from prosecution under Title 13.

¶10 The court also addressed Defendants’ due process objections to the prosecution. It noted that Defendants worked with different state agencies to ensure compliance with the law. Noting that because the legislature did not contemplate this new bingo technology, the court found that constitutional safeguards, due process and notice, mandate that the alleged conduct be charged under Title 5 (which regulates amusements and sports, including bingo) as opposed to Title 13 (the criminal code). The court suggested that “it is incumbent upon the legislature to amend the statutes to address the new approaches [to] the administration of the game as to what is and is not [b]ingo.”

¶11 The State timely appeals. We have jurisdiction. Ariz. Const. art. 6, § 9; A.R.S. § 13-4032(1).

DISCUSSION

¶12 Upon a defendant's motion, the court must dismiss criminal charges where an indictment is insufficient as a matter of law. Ariz. R. Crim. P. 16.4(b). We generally review a court's dismissal of an indictment for an abuse of discretion. State v. Wood, 198 Ariz. 275, 277 ¶ 6 (App. 2000). But where the dismissal of an indictment “is entirely a matter of statutory interpretation” we review it de novo. Id.

¶13 The State argues the superior court erred by dismissing the Defendants’ indictments under Rule 16.4(b) by: (1) improperly finding facts and weighing evidence; (2) finding Defendants could not be charged with promotion of gambling because the Lynxx Devices have some legal uses—here, regulated game play; and (3) finding the indictment violated due process, while applying the rule of lenity. We address each argument in turn.

I. The Superior Court Did Not Engage in Improper Factfinding or Evidence Weighing.

¶14 The State argues the court improperly found facts or weighed evidence. Defendants argue the State either waived this argument or invited any such error. Defendants deny the court improperly found facts or weighed evidence. We see no waiver or invited error, but otherwise agree with Defendants.

A. The State Did Not Waive Any Objection to Improper Factfinding.

¶15 The State did not waive this issue or invite any supposed error. The State's first argument in response to Defendants’ motion to dismiss treated the facts of the indictment as true, consistent with Rule 16.4(b). See Mejak v. Granville, 212 Ariz. 555, 556 ¶ 4 (2006). The State argued Defendants “concede[d] that the indictment is valid on its face because it apprises Defendant[s] of the elements of the crime charged, is sufficiently definite to allow [them] to prepare a challenge and protect[ed] [them] from further prosecution for the same offense.” Defendants argued the indictment was insufficient because they could admit to all the allegations in the indictment and not have committed the charged crimes because the Lynxx Devices are regulated gambling. The State discussed how Lynxx Devices work only to rebut Defendants’ arguments that regulated gambling is exempt from prosecution under A.R.S. § 13-3303 and that the Lynxx Devices are bingo, which is regulated gambling. See State v. Herrera, 232 Ariz. 536, 544 ¶ 16 (App. 2013) (stating the invited error doctrine provides the Court will not find reversible error where the party complaining of it injected the error into the record (citing State v. Logan, 200 Ariz. 564, 565-66 ¶ 9 (2001))). These arguments concern the subject matter of the indictment, which is whether the promoters of the Lynxx Devices could possibly have engaged in illegal activity. There is no request for factfinding inherent in arguing that point, nor is there waiver of the position that the court should not be finding facts.

B. The Court Did Not Engage in Improper Factfinding.

¶16 At the same time, we reject the State's contention that the court improperly found facts and weighed evidence. It rests on the State's argument the court erred by: (1) finding Lynxx Devices capable of both regulated bingo and illegal gambling; (2) identifying the function and workings of Lynxx Devices; and (3) finding how the machines were designed to operate and for what purposes.

¶17 Under Rule 16.4(b), “[i]f a defendant can admit to all the allegations charged in the indictment and still not have committed a crime, then the indictment is insufficient as a matter of law.” Mejak, 212 Ariz. at 556 ¶ 4 (citations omitted). An indictment is sufficient, however, “if it inform[ed] the defendant of the essential elements of the charges; is sufficiently definite so that the defendant can prepare to meet the charges; and protects the defendant from subsequent prosecution for the same offense.” State v. Rickard-Hughes, 182 Ariz. 273, 275 (App. 1995) (citations omitted). A motion to dismiss should not determine whether the crime was factually possible. State v. Kerr, 142 Ariz. 426, 431 (App. 1984).

¶18 The question is whether considering the attributes of the Lynxx Devices reaches outside the indictment. It does not. The indictment alleges Defendants, through Lynxx Gaming, “knowingly did conduct the affairs of the enterprise through racketeering, in violation of [A.R.S.] §§ 13-2312(B), 13-2301, 13-701, 13-702, and 13-801[.]” And it alleges Defendants “knowingly, for a benefit, did conduct, organize, manage, direct, supervise, or finance gambling ․ in violation of [A.R.S.] §§ 13-3301, 13-3303, 13-701, 13-702, and 13-801[.]” The parties agree that the Lynxx Devices are the crux of these charges and that the State's indictment alleges the Lynxx Devices offer an illegal gambling game.

¶19 A court may use facts to determine the legal sufficiency of an indictment if the facts are intrinsic to the charges in the indictment. See Mejak, 212 Ariz. at 558-59 ¶ 19; State v. Duci, 151 Ariz. 263, 267 (1986); State v. Am. Holiday Ass'n, Inc., 151 Ariz. 312, 317 (1986). Facts are intrinsic to the indictment if they are either explicitly stated in the indictment or agreed to by the parties. See Mejak, 212 Ariz. at 556 ¶ 3 n.2. Here, the parties both agree and understand that the conduct alleged in the indictment refers to the Defendants’ leasing and managing of the Lynxx Devices. Therefore, the superior court properly considered facts concerning the Lynxx Devices, including how they are used and operated, to decide the motion to dismiss.

¶20 Relatedly, we agree with the superior court that Defendants’ characterization of the Lynxx Devices as “bingo” does not determine the sufficiency of the indictment. Instead, because Defendants argued the Lynxx Devices are regulated bingo exempt from promotion of gambling, the court needed to decide whether the Lynxx Devices were capable only of regulated gambling. See Mejak, 212 Ariz. at 559 ¶¶ 21-23 (dismissing indictment where it was impossible to commit the crime alleged based on the facts agreed to by the parties). The court did not err in considering the capabilities of the Lynxx Devices, which again, were the subject matter of the indictment.

II. The Superior Court Erred by Finding Defendants’ Conduct Could Not Be Prosecuted Under A.R.S. § 13-3303, the Promotion of Gambling Statute.

¶21 The State argues the superior court erred by finding all conduct related to the Lynxx Devices was exempt from prosecution under A.R.S. § 13-3303. We agree.

¶22 Regulated gambling is “not unlawful” if the “gambling is conducted in accordance with the statutes, rules or orders governing the gambling.” A.R.S. § 13-3302(A)(3). To evaluate the indictment's sufficiency, the superior court considered whether the Lynxx Devices offer “regulated gambling” exempted from A.R.S. § 13-3303.

¶23 “When interpreting a statute, we make every effort to give effect to the intent of the legislature.” Mejak, 212 Ariz. at 557 ¶ 8 (citations omitted). We begin with statutory language. Id. If the language is “clear and unambiguous,” we do not need to ascertain the legislative intent. Id. But we must “give effect to every provision in the statute” and interpret it “so that no provision is rendered meaningless, insignificant, or void.” Id. at ¶ 9 (citations omitted).

¶24 Like the superior court, we reject as unpersuasive Defendants’ position that all gambling characterized as bingo is exempt from the promotion of gambling statute. The gambling offered must actually be bingo to be exempt. Further, regulated gambling must be “conducted in accordance with the statutes, rules or orders governing the gambling.” A.R.S. § 13-3302(A)(3).²

¶25 The superior court found the Lynxx Devices capable of both regulated and unregulated gambling. It acknowledged the Lynxx Devices are more like a slot machine when they are unlinked to other machines and played by a single player because the machine is capable of winning. But it noted that when the Lynxx Devices are linked in the multi-player mode, the game is more like live bingo, as there is always a winner and the balls drawn are identical for each player. From this, the court concluded the indictment must be dismissed because the Lynxx Devices can provide legal, regulated gambling.

¶26 The court erred by dismissing the indictment on the ground that the Lynxx Devices are capable of legal function. That analysis inverts the question Rule 16.4 asks—which is whether the indictment accuses the defendants of only legal conduct. See Mejak, 212 Ariz. at 556 ¶ 4; State v. Holmes, 250 Ariz. 311, 314 ¶ 11 (App. 2020). Because the court found the Lynxx Devices were capable of both legal and illegal conduct, the indictment accused Defendants of at least some illegal conduct. Specifically, the court found the Defendants could have committed a crime if and to the extent Lynxx Devices were used in the single-player mode. On remand, the jury can decide those questions.

III. The Superior Court Erred by Finding Due Process Required the Dismissal of the Indictment and by Using the Rule of Lenity to Interpret the Promotion of Gambling Statute.

¶27 The State argues the court abused its discretion by improperly relying on due process considerations and the rule of lenity to dismiss the indictment. Defendants argue due process required the court to dismiss the indictment because they (1) met with state agencies to determine if the Lynxx Devices were legally compliant before they began leasing them, (2) were aware of the statutory scheme, and (3) could not have known they could be charged with promotion of gambling and racketeering under the statutory scheme. They also contend the exemption for regulated gambling in Title 13, Chapter 33 as applied to the promotion of gambling statute is ambiguous, given that Title 5, Chapter 4 does not clearly define bingo and provides that a knowing violation of the bingo statutes is a class 3 misdemeanor. We agree with the State.

¶28 When interpreting “criminal law, we must take account of a criminal defendant's constitutional right to due process: [t]he first essential of due process is fair warning of the act which is made punishable as a crime.” State v. Lockwood, 222 Ariz. 551, 553 ¶ 4 (App. 2009) (internal quotations and citations omitted). “When the meaning of the statute is unclear or subject to more than one interpretation, the rule of lenity requires us to resolve any ambiguity in favor of the defendant.” Reinesto v. Superior Court, 182 Ariz. 190, 192 (App. 1995).³

¶29 The promotion of gambling statute is unambiguous and gave Defendants fair notice they could be charged under it. It provides that “a person commits promotion of gambling if he knowingly ․ [c]onducts, organizes, manages, directs, supervises or finances gambling” for a benefit. A.R.S. §§ 13-3303(A)(1), -3301(1). A person cannot be charged with promotion of gambling if the gambling is regulated. A.R.S. §§ 13-3303(A)(1), -3302(A)(3). But regulated gambling is exempt only if it “is conducted in accordance with the statutes, rules or orders governing the gambling.” A.R.S. § 13-3302(A)(3); see also A.R.S. § 13-3301(8)(b)(i) (defining regulated gambling as gambling “operated and controlled in accordance with a statute, rule or order of this state or of the United States”). Title 13 is clear that to be exempt from criminal penalties, gambling must be regulated by Arizona or federal law. Thus, if the Lynxx Devices play an unregulated game, “conduct[ing], organiz[ing], manag[ing], direct[ing], supervis[ing] or financ[ing]” play with them can violate A.R.S. § 13-3303. Defendants had notice that if Lynxx Devices are used for purposes other than bingo, they could be charged with promotion of gambling.

¶30 Defendants argue Arizona's bingo statutes are ambiguous because the bingo violation statute in Title 5 makes a knowing violation of the bingo statutes a class 3 misdemeanor, A.R.S. § 5-410, while the promotion of gambling statute punishes its violation as a felony, A.R.S. § 13-3303(B). But this is not a real ambiguity because Defendants’ argument is a bootstrap. Their position presumes that because they call all uses of the Lynxx Devices “bingo,” these two statutes improperly regulate bingo at cross-purposes with each other. But this is not so. The game the Lynxx Devices offer must actually be bingo for the bingo statutes to be implicated and to trigger the exemption from the promotion of gambling statutes. Put another way, if the Lynxx Devices perform only regulated bingo, their use will not be punishable under Title 13, avoiding the contradiction in statutory law Defendants suggest. The rule of lenity does not apply here, and it was error to dismiss the indictment in partial reliance on it.

CONCLUSION

¶31 For the foregoing reasons, we reverse and remand to the superior court to reinstate the indictment.

FOOTNOTES

1.   The grand jury indicted other defendants, but they are not parties to this appeal and are not relevant to or discussed in this opinion.

2.   Defendants and amici emphasize that the Lynxx Devices are BTAs under A.R.S. § 5-406(X). But whether the Lynxx Devices comply with the BTA statute, A.R.S. § 5-406(X), is not at issue in this appeal, because Defendants are not charged with possession of a gambling device, A.R.S. § 13-3306, and the State does not allege the Lynxx Devices are illegal devices.

3.   One commentator has suggested the rule of lenity has been abolished in Arizona. See Samuel A. Thumma, State Anti-Lenity Statutes and Judicial Resistance: “What A Long Strange Trip It's Been,” 28 Geo. Mason L. Rev. 49, 100 (2020) (arguing A.R.S. § 13-104 abolished the rule of lenity). However, the Arizona Supreme Court has not disavowed the rule of lenity and appears to regard it as viable. See, e.g., State v. Serrato, 148 Ariz. Cases Dig. 42, 48 ¶ 33 (2025) (“[A]bsent ambiguity, the rule of lenity does not apply.” (cleaned up)). Neither party suggests the rule of lenity has been abolished, so we do not reach the issue.

JACOBS, Judge: