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Sunday, October 20, 2013 at 10:24 AM

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Attorney General Mike DeWine says Internet cafes are shutting down now that Ohio’s revised gambling laws are in effect. As Statehouse correspondent Andy Chow reports, the Attorney General’s office is keeping an eye on compliance.

It’s been two weeks since the new sweepstakes laws took effect, and Attorney General Mike DeWine says Internet cafes around the state are now closing up shop.

The laws, created by H.B. 7, started after a referendum effort failed to collect enough signatures to put on a ballot.

DeWine says most of the vendors who design and operate the sweepstakes software are leaving Ohio. The state’s top law enforcement official says he’s holding off on raids to give companies time to sort things out.

“They’re complying with the law and I think they see that they’ve seen they’ve run out the string,” DeWine said. “They went as long as they could go and it’s over with now.”

The Attorney General’s office is also reaching out to local law enforcement to make them aware that his office is standing by to help enforce the new regulations.

The group behind the referendum effort has declined to comment on the issue as they evaluate further legal options.

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Was it gambling?  For years, the leaders of Allied Veterans of the World maintained publicly that its chain of strip mall Internet gaming centers were perfectly legal. Now a former employee says those that worked inside knew all along while it may have been called an Internet center operating a sweepstakes, but it was most certainly a casino.

"You wouldn’t see anybody in there on the Internet. You’d go in there and see casino style slot machines on a computer," says former Allied Vets employee Evan Wallace.

Wallace worked at the Allied Vets location off North Woodland Boulevard in DeLand for more than a year.  That location in DeLand was operated by Coastal Games LLC, one of the companies listed by the state in its takedown of Allied Vets.  According to documents obtained by Eyewitness News, the Volusia County Bank of America account opened by the operators of Coastal Games LLC received deposits totaling $19,613,785 between Jan. 1, 2008 and March 31, 2012, with $208,833 in the account when authorities froze the assets of the strip-mall centers.

"One good day, on a Friday, we had about $80,000 to $85,000 in the safe alone and that’s not even including the cash in the register," said Wallace. "(Customers would) come in the morning and not leave until that night, they’d spend all their money, come back with more money, lose all that."

At the height of its operation, Allied Veterans of the World operated 49 strip mall gaming locations across Florida, with 16 in central Florida.  The multimillion-dollar-a-year business billed itself as a sweepstakes that donated its proceeds to the legitimate charity Allied Veterans of the World; in March 2013 that all ended.

In a series of highly orchestrated sweeps, law enforcement arrested 57 people and froze more than $100 million in bank accounts.  The state called the Internet cafes nothing more than illegal casinos operating on the fringes of the law with the majority of profit going not to veterans as the group claimed, but instead to a select few leaders of the group.

"We were told to tell them that either 95 or 97 percent of all of the cash coming in was being donated to the Allied Veterans organization," said Wallace.

While they were open, the Internet centers featured letters from veterans thanking Allied Veterans for donations.  The group routinely boasted about its charitable donations, however, state records show less than 3 percent of the money collected ever made its way to veterans; a fact kept secret from employees.

"I was angry when I found out. I thought that they were donating what they really said that they were," said Wallace.

Since the arrests, the state has dropped charges on almost a dozen defendants and taken plea deals from two top leaders.  In August former national commander Johnny Duncan pleaded no contest to four counts of maintaining an illegal lottery and one count of money laundering, days later, Allied Vets National Commander Jerry Bass pleaded no contest to two counts of pleaded no contest to maintaining an illegal lottery; neither man will serve jail time.   On Oct. 11 a Seminole County jury returned a guilty verdict in the state’s case against Jacksonville attorney Kelly Mathis, finding the one time legal adviser to Allied Vets guilty on 103 of 104 charges ranging from possessing slot machines and operating a lottery to racketeering.

In the trial, the state maintained that it was Mathis who directed the organization as to how to operate, telling leaders what they could and could not do in accordance with state and local law.  Wallace says managers were very specific about what to call the machines and games, he says they were even given a script to read from to new players telling them they were purchasing "Internet time" and not "gambling."

"We were real strict about what we couldn’t say and what we had to say," said Wallace. "If people came up to us and said they wanted to cash out, we had to say do you want to redeem your sweepstakes."

The state still has charges pending against several dozen defendants.  Sentencing for Mathis is scheduled for later this year.

A Jacksonville attorney was convicted Friday of using a veterans’ organization as a front for a $300 million gambling operation in a case that led to the resignation of the state’s lieutenant governor and caused the Legislature to ban so-called Internet cafes.

Six jurors deliberated for more than 14 hours over two days before finding Kelly Mathis guilty of possessing slot machines, helping top operate a lottery and racketeering. He was found guilty on all but one of the 104 counts against him.

Mathis was released on bond until his sentencing in February when he faces the possibility of dozens of years in prison. He described the verdict as “shocking” as he left courtroom.

His attorney, Mitch Stone, said the fight wasn’t over. Mathis’ attorneys have said they were constrained in their defense presentation by a judge’s ruling that limited the evidence they could introduce.

“I gave legal advice as an attorney; that’s all I did,” Mathis said as he left the courtroom.

“Attorneys all over the nation need to be very afraid when six years after you give legal advice, somebody disagrees with that legal advice and they convict you of a crime.”

Statewide prosecutor Nick Cox said he found no joy in winning a conviction against a fellow attorney.

“You can’t use the practice of law as a shield,” Cox said.

“It doesn’t make me happy to convict a lawyer. What message does that send to the public?”

Mathis was the first of 57 defendants to go to trial in a case that led to the resignation of Lt. Gov. Jennifer Carroll, who had worked as a consultant for the Allied Veterans charity. She wasn’t charged with any crime.

Prosecutors said Mathis and his associates built up a network of casinos by claiming they were businesses where customers could buy Internet time, when in reality most customers played slot machine games on computers and didn’t use the Internet. Even though the Internet cafes were being operated under the aegis of Allied Veterans of the World, very little of the $300 million the Allied Veteran affiliates earned actually went to veterans, prosecutors alleged.

Neither prosecutors nor defense attorneys called as witnesses some of Mathis’ key co-defendants who had reached deals with prosecutors: former Allied Veterans of the World leaders Johnny Duncan and Jerry Bass, as well as Chase Burns, who operated a company that made software for computers at the dozens of Allied Veterans centers around Florida.

Defense attorneys also didn’t call some of the state’s top politicians — such as Gov. Rick Scott, Agriculture Secretary Adam Putnam and Attorney General Pam Bondi — even though they were listed as potential witnesses.

The judge in the case limited testimony from witnesses about efforts by local governments and the state Legislature to regulate the Internet cafes.

Such testimony would have been valuable to the defense since it would be impossible to argue something was illegal if governments were setting regulations for it, said defense attorney Stone.

During the three-week trial, prosecutors called a 78-year-old woman who testified that she gambled every night and spent more than $55,000.

They also called a retired Army colonel who testified he had stopped by an Allied Veterans affiliate thinking it was a place for veterans to get help but instead found what looked like dozens of slot machines.

Defense attorneys called to the witness stand a former city of Jacksonville attorney who testified he had agreed with Mathis’ interpretation of the law that the Internet cafes were legal.

They also called other law enforcement officials and municipal attorneys who said they had never found anything wrong with Mathis’ interpretation of the law.

Enlarge Image Eric Albrecht | DISPATCH

Machines sit in a dark Players Club Internet Cafe at Emporium Square on Rt. 161. The company that owns the cafe pulled the plug on its Ohio operations.

By  Alan Johnson

The Columbus Dispatch Saturday October 5, 2013 10:17 AM

Internet sweepstakes cafes are unplugging all over Ohio as a new state law heavily regulating them takes effect.

Pong Marketing and Promotions, an Ontario, Canada, company that provided software and Internet service to 55 cafes, including three in Columbus, reportedly terminated all of its contracts with Ohio retail customers as of 11:59 p.m. Thursday — two minutes before the new law took effect.

The Columbus businesses, known as Players Club Internet Cafe, were locked, the lights were off and the phones were not answered yesterday.

Owner Robert Dabish, a Toledo businessman, and Pong officials in Canada did not respond to calls asking about the sweepstakes cafes, which offered cash payouts to customers playing casino-style games on machines connected to the Internet.

VS2 Worldwide Communication, a service provider to 45 Internet cafes, agreed to stop doing business in Ohio entirely as of this Friday, as part of a plea deal settling a gambling case brought against the company’s owners by Cuyahoga County Prosecutor Timothy McGinty.

House Bill 7, a law designed to push the cafes out of business by severely restricting payouts, took effect yesterday after the failure of a campaign to place the issue on the November 2014 ballot as a statewide referendum. The Committee to Protect Ohio Jobs abandoned its campaign after it became clear it would fall far short of the required 231,148 valid signatures of registered Ohio voters.

The committee also failed a second ballot requirement to collect a minimum number of signatures in 44 of Ohio’s 88 counties; the committee met the threshold in 12 counties.

The failed campaign and promises by Attorney General Mike DeWine and law-enforcement officials to immediately begin enforcing the law apparently prompted some cafe companies to head for the exit.

DeWine was sending letters to the 88 county sheriffs and all of the several hundred Internet-cafe owners in the state notifying them of requirements of the law, including a $10 limit on the value of prizes and bans on cash prizes, gift cards, lottery tickets, alcohol, tobacco, firearms and vouchers. Cafes also must obtain a certificate of registration and file monthly reports.

While Pong appeared to have decided to exit the state voluntarily, VS2 is leaving as part of a plea agreement expected to be finalized next week in Cuyahoga County Common Pleas Court. Two principals of VS2 Worldwide Communication, owners Phillip Cornick and Richard Upchurch, were scheduled to go to trial on racketeering, money laundering, gambling and other charges.

Details of the agreement are sealed by a court order, but sources confirmed it involves VS2 dropping all its business interests in Ohio next week.

ajohnson@dispatch.com

@ohioaj

By  Alan Johnson

The Columbus Dispatch Friday October 4, 2013 5:37 AM

Enlarge Image Adam Cairns | ThisWeek Newspapers

The failure of the Internet-sweepstakes referendum yesterday means state and local law officials will begin enforcing a law today that could put the cafes out of business in Ohio.

Less than an hour after the Committee to Protect Ohio Jobs announced yesterday that it was abandoning its campaign to gather signatures to put the Internet cafe law on the November 2014 ballot as a referendum, Attorney General Mike DeWine issued a statement saying enforcement efforts will begin immediately.

“Internet-sweepstakes cafes have long had operations that raised suspicions of illegal gambling,” DeWine said. “Ohio now has a law which makes clear which activities are legal and illegal in these cafes, and we will not hesitate to enforce the law.”

He said he will be sending letters to 88 county sheriffs and all of the several hundred Internet-cafe owners in the state notifying them of the requirements of the law.

“We will be watching,” DeWine added.

Robert Cornwell, executive director of the Buckeye State Sheriffs’ Association, said sheriffs will work closely with DeWine’s office to enforce the new law.

“I don’t think they’re going to be a problem,” Cornwell said of the cafe operators. “I think they will fold up their operations and move to other states that don’t have such tough regulations. That’s what they’ve done before.”

The new law took effect at 12:01 a.m. today. It was originally scheduled to take effect on Sept. 5, but under Ohio law was put on hold by the effort to allow opponents to gather sufficient signatures on a referendum petition. If the petition effort had been successful, the law would have been delayed until after the November 2014 vote.

The new law does not outright ban the cafes, which feature casino-style games played on devices connected to the Internet, but it undoubtedly will make it difficult for them to remain in business. It includes a $10 limit on the value of prizes, and bans awarding prizes in cash, gift cards, lottery tickets, alcohol, tobacco, firearms and vouchers. It also requires cafes to obtain a certificate of registration from the attorney general, and to file monthly reports. The Bureau of Criminal Investigation has authority to investigate alleged gambling-law violations at cafes.

The Committee to Protect Ohio Jobs said in a statement: “Sadly, as a result of House Bill 7 going into effect, Ohio will lose thousands of jobs, and state and local governments will lose millions of dollars in tax revenues.”

After falling 71,140 signatures short of the required 231,148 it needed to qualify for the ballot, the committee worked feverishly to gather signatures in the extra 10-day period it was allowed under state law. Dozens of additional collectors were hired to assist Professional Petition Management, a Columbus company that handled signature collection.

However, the group fell short of the total number of signatures needed, and of a second ballot requirement that a minimum number of signatures be collected in at least 44 of Ohio’s 88 counties; the committee had met the threshold in just 12 counties initially.

Carlo LoParo, spokesman for the casino-backed group Ohioans Against Illegal Gambling, which opposed the referendum, said in a statement that the “push by cafe owners to halt this important law came up short because Ohioans refused to aid and abet a known criminal enterprise.”

ajohnson@dispatch.com

@ohioaj

Authorities seized these machines in April from an Internet cafe in Euclid. WILLOUGHBY HILLS, Ohio -- On Day 1 under stifling new state regulations, two Internet cafes positioned across from each other on Chardon Road took markedly different tacks.

The Sweepstakes Club, which was open just 24 hours earlier, according to a customer, was locked late Friday morning. A sign on the door said the cafe was "closed for an upgrade" and will resume operation Monday.

The Cyber Playground, on the other hand, was in full swing, with more than 30 patrons hunkered down in dim light over slotslike computer games. But customers had to sign a new form advising them that they were playing at their own risk.

"They could shut us down at any time," a female employee told several who were waiting in line.

The cafes are free to remain open under a law that took effect at midnight, hours after opponents said they had failed get enough signatures for a statewide vote on the statute and its new restrictions.

But owners are prohibited from awarding cash jackpots or prizes worth more than $10, rules that threaten to choke an industry casino operators and other critics say is a facade for illegal gambling. Another employee at the Cyber Playground said the cafe was paying customers the value of "whatever is on their cards." 

Attorney Daniel Gourash used to represent more than 20 cafes in Cuyahoga County, where court cases and raids waged by Prosecutor Timothy J. McGinty and state agents gradually forced a supply of more than 50 to fold.

Gourash said Friday that he expects to see a lawsuit filed on constitutional grounds, though he declined to comment on whether he would handle the filing. He said arguments could allege that state legislators violated home-rule powers in cities that had licensed cafes and charged them fees, or illegal "taking" of enterprises that legislators had long tolerated.

Cafe operators say they run legitimate businesses, selling Internet or phone time and using sweepstakes games for marketing. Critics say customers have no interest in the products, just playing games for cash.

Michelle Allen of Cleveland pulled up in front of the Sweepstakes Club on Friday morning and learned she was shut out of a place she has visited almost daily. Allen said she recently won $1,600 in a two-day period but wouldn't really mind if the new law sends all the cafes packing.

"It probably wouldn't affect me much," said Allen, 31. "It's more of a fun thing. I come to relax, actually."

Unable to get into the Sweepstakes Club, Ron, a 63-year-old retiree who wouldn't give his last name, headed to the Cyber Playground with his wife. The Cleveland Heights man said he caps his day's spending at $20 and would not be bothered if the cafes disappear.

"I'm all for it," he said without hesitation. "It can be habit forming. It's like any other addiction."

Attorney General Mike DeWine, a leading opponent of the cafes, pledged Thursday to watch for cafes that break the law. Spokesman Daniel Tierney said enforcement will start by sending cafes letters outlining "expectations" and notifying county prosecutors which cafes have registered with the attorney general, as required. 

Tierney said people who believe cafes are violating the law can call local authorities or contact the state Bureau of Criminal Investigation at 1-855-BCIOHIO.

The owners of VS2 Worldwide Communications, a New Jersey company that supplies software to the Cyber Playground and many other Internet cafes in Ohio, are to be sentenced Thursday in Cuyahoga County Common Pleas Court, but the terms of pleas they entered are sealed until then. They were indicted on charges of racketeering, money laundering, possession of criminal tools and gambling in connection with use of their products.

To head off raids in Lake County, Cyber Playground and two other cafes sued DeWine, county Prosecutor Charles Coulson and three cities' prosecutors in Franklin County Common Pleas Court. The judge did not grant the injunction that was sought but indicated that authorities should delay any action they might be considering.

Dominic Vitantonio, an attorney who filed the suit, could not be reached for comment Friday.

By  Alan Johnson

The Columbus Dispatch Wednesday October 2, 2013 4:01 PM

Enlarge Image Eamon Queeney | DISPATCH

Volunteers unload boxes of signatures for a referendum on House Bill 7 on Sept. 3. Their shirts tout a poll backing their cause.

Backers of a referendum campaign to overturn an Internet sweepstakes café law have stopped collecting signatures and are deciding if they will file an updated petition at all by Thursday’s deadline.

“Right now we’re inventorying signatures,” Mark Weaver, spokesman for the Committee to Protect Ohio Jobs, said today. “If we have enough, we’ll file. If we don’t, we won’t.”

If they fail to file the forms Thursday, the law will take effect immediately.

Weaver acknowledged that signature gathering has stopped and that the petition forms are being sent to Columbus via overnight delivery to be counted.

The committee, which is bankrolled primarily by café owners and software companies, must submit 71,140 valid signatures of registered Ohio voters to Ohio Secretary of State Jon Husted by Thursday’s deadline. If they don’t submit the signatures at all, or fail to submit enough names, House Bill 7, a law approved by the legislature earlier this year and signed by Gov. John Kasich, will take effect. That is likely to force the Internet cafes out of business in Ohio.

The café group has been working feverishly to gather signatures in the week-plus since they fell short of the 231,148 minimum required to put the law on the November 2014 ballot as a referendum. Additional collectors were hired to assist Professional Petition Management, a Columbus company, which was handling signature collection.

Only about 37 percent of 433,834 signatures submitted Sept. 3 were valid, meaning at that validity rate cafe supporters must collect roughly 200,000 names to produce the number needed. The committee also initially fell short of having adequate signatures in 32 counties to fulfill a second part of the ballot requirement that signatures must be collected in at least 44 of 88 Ohio counties.

The law was put on hold to allow time for the referendum campaign. It would eliminate cash payouts at Internet cafes and limit prizes to a value of $10. The cafes offer slot-machine-style games played on computer terminals. Operators deny that the games are gambling because customers get something of value in exchange for their money – long-distance phone cards or Internet time.

ajohnson@dispatch.com

@ohioaj

cornick.jpgPhillip Cornick, left, co-owner of VS2 Worldwide Communication, confers with attorney Mark Schamel during a hearing in April in Cuyahoga County Common Pleas Court.

CLEVELAND, Ohio -- Cuyahoga County Prosecutor Timothy J. McGinty says the public has the right to know the terms of pleas entered in a criminal case against an Internet cafe supplier, and he has asked a judge to unseal the details.

The owners of VS2 Worldwide Communication, a cafe software supplier, "have no overriding interest in maintaining the secrecy" of proceedings, McGinty says in a motion filed Friday in Common Pleas Court.

The New Jersey company, along with owners Phillip Cornick and Richard Upchurch, submitted the pleas late Friday afternoon. Another New Jersey company, PE Technologies, and Mike Koty, identified in court papers as PE's service manager, also submitted pleas.

Proponents of Internet cafes say the storefront businesses sell Internet or telephone time and use the banks of slots-like computer games on their property to market those goods. McGinty disagrees and was pursuing charges of racketeering, money laundering, possession of criminal tools and gambling against VS2 and others.

Over prosecutors' objections, Judge Deena Calabrese sealed the pleas until sentencing, which is scheduled for Oct. 10. Prosecutors and defense attorneys have declined to comment, citing a gag order that the judge imposed in the high-profile case in June.

Pleas are typically sealed because the prosecution wants to secure cooperation from defendants, said Law Professor Michael Benza of Case Western Reserve University. In this instance, he said, the defendants may "want to take care of some things before it goes public."

VS2 has agreed to cease doing business in Ohio the day after sentencing, defense lawyer Mark Schamel said in court. Dominic Vitantonio, an attorney for two Internet cafes that use VS2 software in Lake County, said that won't absolve the company of obligations to its vendors.

"There would be contractual issues that would have to be resolved," he said.

Cleveland attorney Michael Nelson, who represents other VS2 cafes, said the company's departure would raise numerous questions involving matters such as leases and telephone connections. He said another question is whether customers have claims for telephone and Internet time that authorities say are rarely redeemed.

Cafes once numbered as many as 800 in Ohio, but ranks thinned as McGinty and state Attorney General Mike DeWine turned up the pressure. The remainder will effectively be put out of business if supporters fail to overturn legislation that prohibits the cafes from awarding cash jackpots and caps the value of other prizes at $10.

Secretary of State Jon Husted said last week that circulators had gathered only 160,008 valid signatures out of 231,148 needed to place the legislation on a statewide ballot.

Circulators also were required to collect signatures in at least half of Ohio's 88 counties and in each county get a number equal to at least 3 percent of the votes cast for governor in 2010. They reached the minimum in only three counties.

Leaders of the petition drive have until 4 p.m. Thursday to close the gap. Organizer Mark Weaver could not be reached for comment Monday.

Robert Higgs of Northeast Ohio Media Group contributed to this story.

inetcafe.jpgLaw-enforcement officials load equipment into a truck after raiding an Internet cafe in Euclid on April 17.

CLEVELAND, Ohio -- The owners of a company that supplies software to Internet cafes have entered a plea in their gambling case and will quit doing business in Ohio on Oct. 11.

The terms are unknown because Cuyahoga County Common Pleas Judge Deena Calabrese sealed the plea until imposing sentence Oct. 10, and the two sides are bound by a gag order.

New Jersey-based VS2 Worldwide Communication and owners Phillip Cornick and Richard Upchurch were to face trial next month on charges of racketeering, money laundering, possession of criminal tools and gambling, all stemming from use of their products.

Also pleading under seal Thursday were another New Jersey company, PE Technologies, that prosecutors say has been involved in distributing computers or machines to cafes and Mike Koty, identified in court documents as PE's service manager.

Calabrese had said the case could set a nationwide precedent. She imposed the gag order at the request of defense lawyers after county Prosecutor Timothy J. McGinty made what they considered incendiary statements.

Cafe supporters say the businesses sell Internet or telephone time and use slots-like sweepstakes games for marketing. McGinty and Ohio Attorney General Mike DeWine dismiss the operations as fronts for illegal gambling and perhaps other crimes.

Proponents have been trying to overturn state legislation that would effectively kill the cafe industry in Ohio by prohibiting cash jackpots and capping the value of other prizes at $10.

The Ohio Secretary of State's Office announced Monday that petition circulators fell more than 71,000 valid signatures short of the number needed to place a referendum on a statewide ballot. They were given until Oct. 3 to close the gap.

The plea deal came late Thursday afternoon after VS2's lawyers failed in an attempt to quash evidence. Washington, D.C., defense attorneys Mark Schamel and Cathy Hinger had sought to bar material seized in April from the company's New Jersey headquarters, Cornick's home in Ocean County, N.J., and several Cleveland-area cafes.

Calabrese denied the motion Tuesday, saying the prosecutor's office had demonstrated sufficient grounds to get permission for the raids.

Calabrese also rejected an argument that the county has violated rights to a speedy trial. McGinty and his predecessor, Bill Mason, had filed a total of seven indictments against VS2 and its owners since May 2012. 

The plea deal was entered in open court, but a Plain Dealer reporter arrived just as Calabrese gave the order to seal the terms, a move objected to by prosecutors.

She had ended a pretrial hearing earlier in the afternoon, with the sides set to return Friday. Prosecutors and defense lawyers had spent a day and a half shuttling in and out of closed meetings.

Calabrese said sealing plea deals is common -- in federal court. She declined to elaborate on her reasons until the sentencing.

After Calabrese ordered the terms sealed, Schamel stipulated for the record that VS2 would cease operations in Ohio on Oct. 11.

By  Jim Siegel

The Columbus Dispatch Wednesday September 25, 2013 6:15 AM

As Internet-cafe supporters struggle to overturn a new law designed to shut them down, Republican lawmakers appear poised to pass another bill that would still end their operations — only in a different way.

Lawmakers eased back into action yesterday after their summer break, and one of the first bills to appear in committee would prohibit any business from conducting sweepstakes that exceed 5 percent of the business’s gross annual revenue. That would essentially block operations of Internet cafes, which allow customers to play slot machine-like games once they’ve purchased Internet time or phone cards.

Senate Bill 141 passed the Senate in June shortly before lawmakers left for their break. Rep. Mike Dovilla, R-Berea, chairman of the House Policy and Legislative Oversight Committee, said yesterday he expects the bill to move within the next few weeks.

“These are illegal gambling operations, and whatever we have to do to make sure the statute is clear on this, I’m supportive of,” he said.

In May, lawmakers passed House Bill 7, which was designed to shut down Internet cafes by limiting payouts on sweepstakes machines to $10. But cafe supporters have been gathering signatures to get that law overturned on the November 2014 ballot — a move that would, at the least, block implementation of the law until the vote occurred.

But the pro-cafe group, Committee to Protect Ohio Jobs, is having trouble collecting enough signatures. The group fell 71,140 names short of the 231,148 valid signatures of registered Ohio voters needed to qualify for the ballot after only about 37 percent of its original names were certified.

The group has until Oct. 3 to collect the additional signatures.

But the whole effort essentially would be moot if lawmakers passed Senate Bill 141, because even if the earlier law was blocked, the new law would still put the cafes out of business. As it stands, the new bill contains an emergency clause, meaning the law would take effect immediately and would not be subject to referendum.

Passing the bill as an emergency requires 66 House votes — the exact number that voted for the last cafe bill.

The bill, Dovilla said, is designed to ensure there are no loopholes and that the law is as clear as possible, “irrespective of the petitioners and the referendum process.”

Mark Weaver, spokesman for the Committee to Protect Ohio Jobs, said it is “always surprising when the legislature considers banning an entire industry from the state when polling shows 80 percent of Ohioans oppose them doing it.”

Weaver is citing a December poll from Fallon Research in which only 20 percent of respondents said lawmakers should prohibit Internet cafes. The same poll also said 41 percent support having the cafes in Ohio.

The second bill also includes a provision giving the Ohio Casino Control Commission the ability to investigate attempted money-laundering transactions at the state’s four casinos.

jsiegel@dispatch.com

@phrontpage