RICHMOND, Va. (WRIC) – The Supreme Court of Virginia has brought back the state’s ban on so-called skill games, a decision that will impact convenience stores, gas stations and other businesses with the slots-like betting machines.
The high court’s order, first reported by The Virginia Mercury, comes amid an ongoing legal battle between the state and businesses in the industry, led by truck stop owner and former NASCAR driver Hermie Sadler, over Virginia’s ban.
In its order, the state Supreme Court found Sadler’s challenge is unlikely to succeed on its argument that the machines deserve the same free speech protections as video games, ruling that a lower court “abused its discretion” when a Greensville County judge found otherwise.
“Although at times it is difficult to determine where a particular activity falls on the speech/conduct continuum, no such difficulty is present when the activity being regulated is gambling,” the order from Justices Teresa M. Chafin, Stephen R. McCullough and Wesley G. Russell Jr. reads. “We long have viewed gambling as conduct that may be heavily regulated and even banned by the Commonwealth as an exercise of its police powers.”
The Virginia General Assembly voted for the so-called skill games ban, but lawmakers agreed to delay the ban at the request of then-Gov. Ralph Northam (D) so the tax revenue from the machines could help fund state needs amid the COVID-19 pandemic.
The ban, which was slated to take effect in July 2021, came as state lawmakers approved legislation to make way for up to five casinos and mobile sports betting in Virginia.
But the Greensville County Circuit Court judge overseeing Sadler’s lawsuit blocked the commonwealth from enforcing the ban with an injunction, leaving the devices largely unregulated.
The electronic betting machines, sometimes called “gray machines” because they function in a gray area of the law, look and pay out winnings like slot machines. The industry and manufacturers of the machines argue skill is involved — hence the name “skill games.”
Supporters of skill games, including distributors, have argued that the machines give small businesses much-needed income and would provide millions in tax revenue for the commonwealth, including public education funding, if allowed to remain.
The attorneys for Pace-O-Matic, the skill-games developer behind the Queen of Virginia games, “are currently reviewing the opinion and assessing next steps,” spokesperson Christina Freundlich said in a statement.
The offices of Gov. Glenn Youngkin and Attorney General Jason Miyares did not immediately respond to requests for comment on the order, how the state would alert businesses with the betting machines and enforce the ban.
Sadler’s lawsuit is expected to go to trial in Greensville County Circuit Court in mid-December, records show.