Legal Limbo for Virginia’s Electronic Skill Games

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Geneal view showing clients gambling at electronic machines. Stephane De Sakutin/AFP

The Virginia Supreme Court overturned a lower court’s injunction that barred enforcement of the state’s ban on skill games, but there is still a long litigious road ahead for Virginia bettors.

Ban Back On

They look like slot machines but they are technically skill games because the outcome is effectuated by the customer and is not totally random like a slot machine. But it’s a gray area in many states, which is why they are often called gray machines.

Virginia is one of those states in which the existence of the machines has become a political football, especially now that casino gambling has come to Old Dominion. Thus, enforcement banning the machines has been tentative and a definitive court ruling has yet to be adjudicated.

Former Virginia Governor Ralph Northam finalized a law banning the gray machines in 2020 but that was about the same time COVID-19 wreaked havoc on the global economy and the governor instructed law enforcement to look the other way so companies housing the machines could produce additional income in those trying times.

However, late in 2021, the ban was back on and enforcement would commence. That’s when a truck stop owner and the manufacturer of the gray machines, Pace-O-Matic, decided to sue the state of Virginia. The trial court hearing the case placed an injunction that banned law enforcement from enforcing the ban on the machines.

The most recent ruling by the state Supreme Court has undone that injunction even though the trial is still proceeding. But until the trial concludes, law enforcement remains wary of banning the machines until a legal ruling is issued.

Long Road Ahead

The truck stops, barrooms, and convenience stores that house gray machines derive an ancillary income because of them and, naturally, don’t want to see that extra income stream extinguished. However, there are casinos in the state that pay hefty licensing fees to operate gambling machines and are also taxed on their gains.

It is not surprising then that the casinos want to be the only entities that run any form of gambling in the state despite the claim that these are “skill games” and not slot machines. A survey commissioned by the American Gaming Association (AGA) revealed that in a survey of over 2000 Americans aged 21 and over, 65% could not tell the difference between skill games and slot machines.

At this point, the legality of skill machines in Virginia is still in the trial court but regardless of that result, there is little doubt the losing side will appeal. And at some point in the future, the case could wind up in the state Supreme Court.

That is why many believe this issue is a long way away from being decided but in the meantime, law enforcement has been given the green light to ban the machines.

However, it won’t likely be on the top of their “to-do list” until a final ruling has been issued and all legal options have been exhausted. Thus, the skill machines will continue to operate in a gray area until the legal limbo is lifted.