New altered skill games ruled legal by Virginia judge
Pace-O-Matic (POM), a Georgia-based developer of “skill games,” has successfully navigated a loophole in Virginia’s legislation prohibiting unregulated slot-like devices, presenting significant implications for the gambling landscape.
A recent ruling by a Virginia judge determined that the updated version of POM’s Queen of Virginia skill-based game, titled Queen of Virginia Skill 2 (QVS2), does not contravene the state’s law banning skill games. This assessment stemmed from a minor modification in the game’s mechanics: rather than accepting coins or tickets, QVS2 necessitates that players pay cash directly to the operator to unlock the game for play.
While structurally similar to previously banned machines, the operational framework of QVS2 distinguishes itself. Once the initial buy-in amount is lost, players have the option to deposit additional funds. Successful players then receive their winnings directly in cash from the operator, a feature that underscores the game’s resemblance to traditional slot machines.
Judge Hugh McConnell of the Hanover County District Court dismissed a misdemeanor charge against a convenience store owner accused of operating these prohibited skill games. The crux of the state’s law is that it specifically categorizes skill devices as those requiring players “to insert a coin, ticket, or token.” McConnell reaffirmed that since the QVS2 game does not necessitate such actions, it falls outside the bounds of the ban.
The Shifting Legal Landscape
In 2020, Virginia enacted a law that banned skill games, which are largely considered illegal slot machines by both regulated casinos and law enforcement agencies. In a bid to support small businesses impacted by the COVID-19 pandemic, Governor Glenn Youngkin postponed the enforcement of the ban for a year. This move highlighted the tension between regulatory compliance and economic survival.
Although a lawsuit from small business owners claimed the ban was unconstitutional, the Virginia Supreme Court ultimately overturned the lower court’s ruling, making skill games unlawful effective October 2023. Following this, Governor Youngkin vetoed subsequent legislation aimed at legalizing skill games after lawmakers rejected his proposals for enhanced regulations.
The revised QVS2 game debuted last summer, quickly drawing attention. However, nearly immediately, Attorney General Jason Miyares issued a memorandum to prosecutors and law enforcement, indicating that these new machines were fundamentally akin to the previously banned games, merely altered to circumvent the state ban.
Breach of Trust and Industry Response
Governor Youngkin criticized POM’s maneuvering as a breach of trust with the state, suggesting that the company should have pursued collaborative negotiations over the legalization of the games instead of exploiting legal loopholes. This controversy spotlights the complex interplay between innovation in gaming technology and regulatory frameworks.
In his ruling, Judge McConnell not only deemed the QVS2 exempt from the state’s stringent definitions but also noted that the existing laws around skill games are sufficiently ambiguous, leaving business owners uncertain about the legality of their operations.
State Senator Bill Stanley, a proponent of legalizing skill games, praised the court’s decision, arguing it was a victory for small businesses over government overreach and the monopolistic tendencies of the casino industry. “Today, justice for the little guy triumphed over a blatant attempt by casino interests to exclude small businesses from the gaming sector,” Stanley emphasized in a statement following the ruling.
As the gaming industry continues to evolve, the ability of entities like POM to adapt to complex regulatory environments will be crucial. Ongoing discussions surrounding the legality of skill games illustrate the challenges of balancing innovation with regulatory compliance, underscoring a growing need for clear guidelines as the industry develops.
