Missouri Gaming Machines Threatened by Lawsuit, Manufacturer Issues Odd ‘Gambling’ Definition

Posted on: June 27, 2019, 08:30h. 

Last updated on: June 27, 2019, 08:30h.

Devin O'Connor @CasinoorgDevinO Read More

Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

The legality of Missouri gaming machines commonly found in convenience stores and bars throughout the state is being targeted by a lawsuit filed by Platte County Prosecuting Attorney Eric Zahnd.

Zahnd’s lawsuit names Kansas-based gaming manufacturer Integrity Gaming LLC as defendant for providing the machines to at least two convenience stores located in Platte. The county prosecutor contends that the devices constitute illegal gambling.

The devices operate similarly to slot machines. Players inset money, select a game, and see their outcome. Winnings can be cashed in at the store cashier.

We believe these sorts of machines are illegal under Missouri law,” Zahnd explained. “Ultimately, the court is going to have to decide.”

The case is set to be heard in December.

The Missouri Gaming Commission says it only oversees legal and approved gambling activities, so it doesn’t consider its agency to have the authority to govern such convenience store devices. Local law enforcement agencies have said the terminals are not a police issue but a gaming consideration that state lawmakers must decide.

Defining Gambling

Missouri is home to a state lottery, and 13 riverboat casinos. Riverboat casinos pay an effective 25.7 percent tax on their gross gaming revenue (GGR). They also collect a $2 per person admission fee, which goes to the state.

Land-based casinos remain outlawed, as does other forms of gambling.

While the outcome of a slot machine isn’t exactly predetermined – the result is determined after a player makes their wager, spins, and a random number generator (RNG) produces the result – the player also has no influence over the conclusion.

A police report in March found the Integrity terminals “have no element of skill.” The Merriam-Webster dictionary defines “gamble” as “to play a game for money or property,” or “to bet on an uncertain outcome.”

Parties Jockeying

Missouri lawmakers have been considering expanding gambling since the US Supreme Court struck down the federal sports betting ban in May 2018. Along with debating whether sports betting should be authorized, state politicians are considering allowing traditional slot machines to be placed inside convenience stores and tavern establishments.

Missouri lawmakers failed to find middle ground to allow its riverboats to operate sportsbooks during its 2019 legislative session. Since the SCOTUS decision now more than a year ago, the gambling activity is operational in seven states plus Nevada.

In Missouri, however, numerous interests that want a piece of any expanded gambling have complicated the matter. Missouri Lottery Executive Director May Scheve Reardon says sports betting would damper its business.

We know that this will impact our sales in the future,” Reardon told the St. Louis Post-Dispatch. “It’s going to drastically affect the money that’s being returned to education.”

“It’s very frustrating to us because we’ve run an incredible business for 33 years,” Reardon added.

Reardon says if the legislature is to approve slot machines in convenience stores and bars, the state lottery should get a cut of the associated tax revenue.   

The Missouri Lottery helps fund the state’s public education programs. The lottery directed more than $300 million to education during the 2018 fiscal year. It was just the second time the lottery has eclipsed the $300 million mark.