The LGS in my tiny college town was banned form running sanctioned events in the early 2000's for this. You know what happened? Literally nothing. They were still the only store within 100 miles (literally), and they charged the exact same amount for the events... just without promos.
Areas like that are what WPN restrictions hurt the most, because a college MTG club *can't* run events since they aren't a store, and so you have one place to play sanctioned events. If that place gets hosed, then... no more sanctioned events.
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