Kentucky Skill Games Proponents File Lawsuit to Block Impending Ban

Posted on: March 28, 2023, 09:35h. 

Last updated on: May 25, 2023, 06:09h.

Steve Bittenbender Read More
Expertise: Legislation, Sports Betting, Horse Racing.

Kentucky’s new law banning gray games, also known as skill machines, will face a legal challenge.

KY Capitol
The Kentucky State Capitol in Frankfort at dusk in April 2022. On Tuesday, Pace-O-Matic and other skill games proponents filed a lawsuit in the Bluegrass State seeking to block a law banning the games passed earlier this month from taking effect. (Image: Casino.org)

Late Tuesday, Pace-O-Matic Chief Public Affairs Officer Michael Barley said in a statement that the Georgia-based game maker was part of a contingent that filed the lawsuit over House Bill 594 in Franklin Circuit Court.

Gray or skill games are electronic gaming devices that resemble slot machines or other video gaming terminals. Proponents of the machines say they’re allowed in Kentucky because players must rely on their skills, such as hand-eye coordination and memory, in order to win. Opponents say the machines are unregulated and would spur criminal activity if they were allowed to remain in operation.

Gov. Andy Beshear (D) signed HB 594 into law on March 16. If upheld, those associated with the machines, including host establishments and game manufacturers, face fines of up to $25,000 per machine if the devices are not removed.

The bill sponsored by state Rep. Killian Timoney (R-Nicholasville) survived being tabled in the state House before finally passing in both chambers. It is set to take effect 90 days after the General Assembly session ends on Thursday.

‘Prepared to Defend the Legality’ of Skill Games

Pace-O-Matic was joined in the lawsuit by ARKK Properties, B.J. Novelty, a distributor of games and other machines for establishments, The Cue Club, a Lexington pool hall owned by Kentucky Merchants and Amusements Coalition President Wes Jackson, Banners, a Lexington sports bar, an American Legion Hall in Lexington, Parlay’s Tavern, a Frankfort bar, and Vincent and Tanya Milano, two Florence residents who play the machines.

Legislation banning skill games is unconstitutional, and we are prepared to defend the legality of our games in court,” Barley said. “Our priority is, and always has been, protecting the rights of Kentucky small businesses and fraternal organizations who rely on legal games of skill for income.”

The complaint argues that skill-based games “have been legal for centuries” in Kentucky and most other places in the US because they rely on a player’s skill, and are not games of chance. Plaintiffs also claim the machines, which have increased in number across the state over the last couple of years, are being targeted by “certain horse racing interests” within the state.

The lawsuit seeks to overturn the law by claiming it violates free speech, due process, and equal protection clauses of the law, and that it takes property without compensating the affected parties. Before that, the plaintiffs also seek a temporary injunction to block it while the case is being heard in the court system.

Kentucky Attorney General Daniel Cameron (R) was listed as the defendant in the case. After participating in a GOP gubernatorial debate in Louisville three weeks ago — while HB 594 was still making its way through the legislature — Cameron said his office would defend a law banning gray games.

Long Process in Getting to Ban

The debate over the gaming machines has been a hard-fought one for the last two years. Timoney and proponents had a ban bill pass both chambers last year. But a late amendment made in the Senate did not get concurrence in the House before the session ended.

Timoney, Senate Majority Leader Damon Thayer (R-Georgetown), and other proponents worked on a new version of the legislation that answered concerns about games available in arcades and fairs. It also includes language protecting eSports contests.

The sponsor said proponents received a lot of feedback from various stakeholders and interested parties throughout the process.

“We haven’t had a chance to review the lawsuit yet, but feel confident that the work we put in, crafting this critical legislation, was enough to withstand any legal challenge,” Timoney told Casino.org Tuesday evening.

Kentucky is not the only state where these gaming machines are the center of a lawsuit. A judge in Virginia issued an injunction on a law that banned the devices in that state. Efforts to regulate the games died in the state legislature there earlier this year.