Toomey

Appellant Bill Toomey and his wife are the sole owners of Holiday Funshine, Inc. (hereafter Holiday) established in 1975, through which he sells discount coupons for use at Reno casinos.

In the first few years of operation, appellant solicited sales by advertising in newspapers and printed mailers. Later, telephone solicitations were used to sell the coupon packages. The casinos where discount coupons were to be redeemed offered such benefits as inducements to attract customers, and customarily authorized distributors such as Holiday to print such coupons through third party promoters. Sometimes, Holiday sold its casino promotion packages wholesale to other distributors for resale to consumers.

The coupon packages varied slightly, but basically took two forms: those redeemable at individual casinos, which included cash, free token play at a designated slot machine, drink coupons, food credits, and gambling incentive coupons such as “Lucky Bucks,” and a “Mini-Bus” package, which provided the buyer with many of the same coupons, to be used at more than one casino during a bus tour. The casino packages were priced at $25 to $30, and were generally represented by…