Short
Primer on Unfair Business Practices:
Amusement industry professionals are as vulnerable as anyone
else to accusations of unfair business practices. Battling
such accusations can be expensive. Of course, going to court
is certainly not fun. This essay will provide a brief introduction
to the basics of legal theory and practice for business owners...
Skill
Crane Unfair Practice Suits: This
year, California news media outlets have been following the
story of one law firm that is suing nearly 2,000 small business
owners. The defendants are principally mom-and-pop auto repair
shops and restaurants that have a public record of any violation
of licensing or health rules.
Redemption
and the Law: Redemption is indispensable
to location-based entertainment. People love to apply their
skill to games like Skeeball and Hoop Shot, knowing that if
they play these games successfully they will receive a merchandise
prize. Redemption is not a simple business, and it contains
a legal trap for the unwary.
State
Law - A Trend for Reform: There
is a new term beginning to appear in the state laws that define
criminal gambling. One by one, states are enacting exceptions
to their gambling laws, specifically to protect amusement
redemption from unwarranted prosecution and harassment. The
new term that is used in half of the reform is "bona
fide amusement device".
A
White Paper in Support of Statutory Reform:
Commenting on our first article on Redemption And The Law,
Deputy Riedthaler states, "I have never known a police
department or sheriff’s office to refuse to examine
or give an opinion on a machine submitted to the agency for
examination of the legality of a device".
Consultation
with Law Enforcement an Option?:
Police consultation is no comfort to the operator. Neither
is police consultation a substitute for statutory reform.
How
one Courageous Operator Singlehandedly Reformed the Law of
Pennsylvania: Pennsylvania’s
law of criminal gambling is unique. It prohibits the possession
and use of “gambling devices” but there is not
a word in the statute to tell you what a “gambling device”
is.
Cranes:
Cranes are innocent devices. We all know that. It wasn’t
too long ago that there were many policemen who disagreed
with us. Envision a massive police sweep. Sixty vice detectives
serving warrants. One hundred thirty devices seized.
How
Bad Can it Be?: The laws against
criminal gambling are tough - just how tough, I will explain
presently. Then, how is it that the reality of what we see
in use seems to indicate that the law is so permissive?
The
Federal Conundrum: The conundrum
for operators of redemption amusement is that the Federal
Law of criminal gambling is at odds with the laws of amusement
redemption of at least 12 (and counting) States.
The
Free Game - Part 1: You should
have seen my son's expression when I told him that the law
treats the award of free games as a crime --- sometimes. He
has this look of disdain that he uses to let you know that
you aren't getting away with your attempt to fool him He doesn't
appreciate it when you try to put one over on him. After all
he's 15.
Florida
Take a Step Back: The general
standard for redemption games in Florida is that only those
which offer a prize "by reason of any element of chance"
are prohibited. If your machine doesn't violate this, there
is no limit to the prize value which you can award.
The
Barrior to Reform: Until now,
most of what I have written in this column has been about
how absurd the law is, concerning amusement redemption. Trust
me, the law is even more absurd than I have presented to date,
and I'll continue painting this Guernica in future issues.
Alabama's
Almost Perfect Reform: This year,
Alabama joined the growing number of states that have enacted
amusement redemption exceptions to their criminal gambling
laws. With Alabama joining the fold, there are now thirteen
states with at lease some sort of redemption reform.
Reform
in Michigan - Again: The Michigan
law of criminal gambling has been the subject of almost constant
tinkering, for about a decade. All in an effort to allow the
People to have something which they clearly desire: prizes
for playing amusement games.
Skill
Stops - Is it in the Look?: From
a recent opinion of the Supreme Court of South Carolina, here
is a description of a type of device which is perfectly designed
to demonstrate the frailty of our laws.
Big
Trouble in Texas: There is trouble
for the Industry, in Texas. Since 1995, Texas has been one
of those states that defines the crime of possessing a gambling
device, not in terms of whether there is more chance then
skill in the operation of the device, but in terms of the
value of the prize.
Debunking
the Myth of Prohibited Features:
When you make that kind of determination, what statute or
what standard are you looking at to give an opinion that this
is or this is not a gambling device?
The
Internet - A New Threat?: Gambling
By Computer is the intentional conducting or directly assisting
in the conducting of any game, contest, lottery or contrivance
whereby a person risks the loss of anything of value in order
to realize a profit using any computer, computer system, computer
software, or any server accessing the Internet, World Wide
Web, or any part thereof.
Coping
with Legal Fundamentalism Part I:
There are some states that permit redemption amusement with
just a little skill and a prize limit. Others prohibit redemption
altogether, (if you want to be guided by the text of the law),
but the prohibition is so unpopular that everybody ignores
it, especially the police.
Coping
with Legal Fundamentalism Part II:
When making an equipment or equipment design decision, it
is not unreasonable to ask oneself the question, “If
I had to defend this game in court, how would I do it and
would I do it successfully?"
Lessons
from Indian Country: Tribal government
gaming has been under furious attack since it began. With
Congress’ passage of the Indian Gaming Regulatory Act
of 1988 (the "IGRA") each recognized tribe was authorized
to conduct bingo, pull tabs and non-banking card games on
tribal land.
All
it Takes is a Little Skill: Nothing
is in the base definition, about skill. There are some strings
attached but basically, an Arkansas “amusement device”
may be licensed by the State and operated lawfully, even though
it is a game of pure chance.
A
Chart of State Constitutional Restrictions on Redemption Reform:
I have checked the constitutions of all of the states and
prepared the chart of state constitutional prohibitions related
to lotteries and gambling, that accompanies these remarks...
Due
Process of Law, Texas Style: Well,
here is some law that everyone can and should understand.
And in Texas its all about the persecution of our industry...
Miracle
in Jeff City: The trouble with
overbroad gambling prohibitions is that nobody cares to enforce
them - most of the time. This abandons the competitive field
to those willing to break the law.
A
Revised Chart of State Constitutional Lottery Prohibitions:
Who would ever think that a video game is a lottery? Seventeen
states prohibit lotteries in their constitutions.
They
Can't do That to Me: ...Maybe.
The situation in Illinois has brought back the video game
backlash of the early 80's in a new setting.
Accumulation:
Accumulation of redemption tickets over a period of time enables
the customer to walk away from the venue with valuable merchandise,
even though for any single game played, the customer is playing
for trifles.
The
Wire Act: Congress is in the process
of amending and supplementing an important Federal law: the
Wire Act. This law was enacted in the early 1960s to enhance
Federal enforcement against sports betting rackets prohibited
under state law.
The
Showdown: Soon after the first
of the year, the Texas legislature will be back in session.
It is likely to act to resolve a controversy raging in that
state over how the law defines amusement redemption. Its disposition
of the controversy will be of significance far beyond the
state’s borders.
A
Victory!: On November 19, 1998,
the Supreme Court of South Carolina handed down an opinion
of significance to the Industry. It told us that every opinion
of the Attorney General of South Carolina about "lotteries"
was without merit.
A
Chart of State Gambling Loss Recovery Statutes:
Litigation pending in two jurisdictions has invited focus
on this question. If the law makes an exception to criminal
gambling or gambling device possession, for a mix game of
chance and skill with a limited prize, can people who play
this game, sue to get their money back?
The
Kyl Bill: Since 1995, Arizona
Senator Jon Kyl has been trying to pass a bill to curb internet
gaming. As we all know, you can play games of chance for cash
today, right on your home computer.
A
Post Mortem: As of May 31, the
legislatures of thirty-one states have completed their job
of law making, and gone home. By July 1, the legislatures
of all but eleven states will be adjourned for the rest of
the year.
The
National Gambling Impact Study Commission Report:
The Commission’s work product was supposed to be some
sort of reference guide for policy makers, needed according
to the Congressional finding because,"the most recent
Federal study of gambling in the United States was completed
in 1976."
The
Showdown in South Carolina: November
2 will be a watershed for the Industry in South Carolina.
On that day, the voters will decide if they want to continue
video poker for limited cash payoffs but under what South
Carolina Governor Jim Hodges has styled, "the toughest
gambling regulations in the world."
Last
Minute Decision of the South Carolina Supreme Court Voids
Video Poker Referendum: On Thursday,
October 14, the Supreme Court of South Carolina handed down
an opinion which was a body blow to the state’s operators
and its economy. Last July, a South Carolina law went into
effect which provided for a public referendum on the question
of video poker.
Federal
Regulation of Skill Games?: A
federal agency has proposed regulations to establish a formal
process for the determination of which games are games of
skill and which are games of chance.
Kyl
Bill Update: "A person
commits gambling when he ... knowingly ... operates an Internet
site that permits a person to play a game of chance or skill
for money or other thing of value by means of the Internet
..."
Texas
Update: According to Associated
Press, during the seven months between October of last year
and this April, the Texas Attorney General's Office has seized
1,000 eight-liner machines and $756,000 in operators' cash.
Epitaph:
By the time this issue of Play Meter is in the mail, the "end
game" for the South Carolina video poker saga will have
played itself out fully. I write this piece four days after
a once-mighty state gaming industry was forced out of business
by what cannot be said was the popular will.
Distributed
Skill Tournaments : Distributed
skill tournaments present contractual and regulatory issues
that you won't normally encounter in the operation of amusement
redemption in a single venue.
Survival,
Texas Style: At last, the appellate
courts of Texas have begun to lay down precedent that answers
some of the riddles presented by the State's "fuzzy animal
law."
Texas
- Where are the Feds?: In a recent
issue of Redemption and the Law, I discussed an operator-favorable
ruling of a Texas Appeals Court: Games of chance are okay,
prizes are okay, replay as prizes is okay and gift certificates
are okay. |
