§ 12050. Hearing Procedures; Appeal of Denial of or Imposition of Conditions on Application for License, Permit, or Request for Finding of Suitability.

(a) If the Bureau, after an investigation pursuant to Business and Professions Code section 19826, subdivision (a), issues a recommendation to deny, limit, restrict, or condition a license, permit, or finding of suitability, the Bureau shall provide the applicant with a copy of the Bureau's final report as described in Business and Professions Code section 19868, subdivision (b), which includes a detailed factual and/or legal basis for any recommendation as well as the Bureau's recommendation to the Commission and any supplemental documents provided to the Commission at the time of the report and recommendation. Any applicant for any license, permit, or finding of suitability for whom Commission staff has issued a recommendation of denial or imposition of conditions shall be given notice by certified mail of the Commission meeting at which the application is scheduled to be heard and the Commission staff recommendation at least 10 days prior to the meeting. The applicant shall be afforded the opportunity to:

(1) Address the Commission by way of an oral statement at a noticed Commission meeting, and/or may submit documents in support of the application, or

(2) Request an evidentiary hearing.

(b) If the applicant requests an evidentiary hearing or the Commission elects to have an evidentiary hearing, the Executive Director shall set the matter for hearing pursuant to Business and Professions Code sections 19870 and 19871, or pursuant to Business and Professions Code section 19825 (conducted pursuant to Chapter 5 (commencing with section 11500) of Part 1 of Division 3 of Title 2 of the Government Code).

(1) If the hearing is to proceed pursuant to Business and Professions Code section 19825 (Chapter 5 (commencing with section 11500) of Part 1 of Division 3 of Title 2 of the Government Code; California Code of Regulations, title 1, section 1000et seq.), the hearing shall be before an administrative law judge sitting on behalf of the Commission. Notice shall be effected pursuant to Government Code section 11500et seq.

(2) If the hearing is to proceed pursuant to Business and Professions Code sections 19870 and 19871, notice shall be effected by the Commission, and the hearing before the Commission shall be conducted pursuant to Business and Professions Code section 19871:

(A) The Bureau or Commission staff or Deputy Attorney General or other representative presenting the case (Complainant) shall provide the applicant, at least 30 calendar days prior to the hearing, a list of potential witnesses with the general subject of the testimony of each witness and shall disclose and make available copies of all documentary evidence intended to be introduced at the hearing and not previously provided, reports or statements of parties and witnesses and all other writings containing relevant evidence, including all evidence made available to the Commissioners. The applicant shall provide Complainant with similar information to be introduced at the hearing and not previously provided at least ten calendar days prior to the hearing. The Commissioners may prohibit testimony of a witness that is not disclosed and may prohibit the introduction of documents that have not been disclosed.

(B) Nothing in this section confers upon an applicant a right to discovery of the Commission's or Bureau's confidential information or to require production of any document or information the disclosure of which is otherwise prohibited by any provision of the Gambling Control Act, or is privileged from disclosure or otherwise made confidential by law. Documentary evidence may be redacted as needed to prevent the disclosure of confidential information. Exculpatory or mitigating information shall not be withheld from the applicant, but may be redacted.

(C) Within the guidelines of subsection (b)(2)(A) above, each party shall have the right to call and examine witnesses; to introduce relevant exhibits and documentary evidence; to cross-examine opposing witnesses on any relevant matter, even if the matter was not covered in the direct examination; to impeach any witness, regardless of which party first called the witness to testify; and to offer rebuttal evidence. If the applicant does not testify on the applicant's own behalf, the applicant may be called and examined as if under cross-examination.

(D) The hearing need not be conducted according to technical rules of evidence. Any relevant evidence may be considered, and is sufficient in itself to support findings if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious affairs, regardless of the existence of any common law or statutory rule that might make improper the admission of that evidence over objection in a civil action. A presiding officer, which shall be an administrative law judge or an attorney designated by the Commission, shall rule on the admissibility of evidence and on any objections raised.

(E) Oral evidence shall be taken upon oath or affirmation, which may be administered by a staff member of the Commission or by a Commissioner.

(F) The hearing shall be stenographically or electronically recorded by the Commission.

(G) At the conclusion of the hearing, the Commission shall take the matter under submission and may schedule future closed session meetings for deliberation. In taking the matter under consideration, any Commissioner who participated at the hearing shall be allowed to vote by mail or by other appropriate method. Within 30 days of the conclusion of the hearing, the Commission shall issue a decision which complies with Business and Professions Code section 19870, subdivision (c), and shall serve the decision by certified mail on the applicant and on any business entity with which the applicant is associated.

(3) At the hearings described in subsections (b)(1) and (2) above, the burden of proof rests with applicant to demonstrate why a license, permit, or finding of suitability should be issued or not conditioned. The applicant may choose to represent himself, herself, or itself, or may retain an attorney or lay representative at his, her, or its own expense. A representative of the Bureau shall present the reasons why the license, permit, or finding of suitability should not be granted or should be granted with conditions imposed. In the event that the Bureau does not present the case, the Commission may seek outside representation or one or more Commission staff members shall be segregated and present the case.

(c) If the application is denied or conditions imposed:

(1) The Commission's decision shall provide the effective date of the decision and may include further directions as to stay provisions or orders to divest.

(2) If the denied applicant is an officer, director, employee, agent, representative, or independent contractor of a corporation licensed, registered, or found suitable by the Commission, the denied applicant shall resign according to the date specified in the decision and shall so notify the Commission in writing.

(3) If the denied applicant is an officer or director of a corporation licensed, registered, or found suitable by the Commission, the corporation shall immediately remove that person from office and shall so notify the Commission in writing. If the denied applicant is an employee, agent, representative, or independent contractor of a corporation licensed, registered, or found suitable by the Commission, the corporation shall terminate its relationship with that person pursuant to the date specified in the decision and shall so notify the Commission in writing. The denied applicant and the corporation licensed, registered, or found suitable by the Commission shall comply with Business and Professions Code section 19882.

(4) If the denied applicant is a general or limited partner in a general or limited partnership licensed, registered, or found suitable by the Commission, the denied applicant shall resign as partner. If the denied applicant is an owner or holder of an interest in a limited partnership licensed, registered, or found suitable by the Commission, the denied applicant and the limited partnership shall comply with Business and Professions Code section 19892 and shall so notify the Commission in writing.

(5) If the denied applicant is a principal in a business entity not otherwise described above which is licensed, registered, or found suitable by the Commission, the denied applicant shall resign his or her position within that entity and divest whatever interest is held in that entity pursuant to the timelines and instructions specified in the decision, and shall so notify the Commission in writing. The business entity shall remove the denied applicant from any principal role in the business entity and shall so notify the Commission in writing.

(6) An applicant denied a license, permit, registration, or finding of suitability, or whose license, permit, registration, or finding of suitability has had conditions imposed upon it may request reconsideration by the Commission within 30 days of notice of the decision. The request shall be in writing and shall outline the reasons for the request, which must be based upon either newly discovered evidence or legal authorities that could not reasonably have been presented before the Commission's issuance of the decision or at the hearing on the matter, or upon other good cause for which the Commission in its discretion decides merits reconsideration. The Commission Chair may delegate to the Executive Director the authority to determine whether to place requests for reconsideration on the Commission agenda or to act on them at the Commission staff level. If placed on the Commission agenda, the applicant requesting reconsideration shall be notified of the date and time of the agenda item. The granting or denial of reconsideration is at the discretion of the Commission. The Commission shall notify the applicant requesting reconsideration whether or not reconsideration is granted or denied within 30 days of the applicant's request. If the Commission grants reconsideration, the effective date of the decision shall be stayed or vacated, at the Commission's discretion, while the decision is reconsidered.

(d) An appeal of a denial or imposition of conditions by the Commission shall be subject to judicial review under Code of Civil Procedure section 1085 (pursuant to Business and Professions Code section 19870, subdivision (e)). Neither the right to petition for judicial review nor the time for filing the petition shall be affected by failure to seek reconsideration.

(e) Proceedings to revoke, suspend, or discipline a license, registration, permit, finding of suitability, or other approval shall be pursuant to Chapter 10 of these regulations.

HISTORY

1. New section filed 10-16-2008; operative 11-15-2008 (Register 2008, No. 42).

Note

Note: Authority cited: Sections 19804, 19870 and 19872, Business and Professions Code. Reference: Sections 19868, 19870, 19879, 19883 and 19892, Business and Professions Code.