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A dispute that could settle, at least for the time being, the legality of skill games in Pennsylvania began with seven receipts, a bank bag holding $525 in cash, and three gaming terminals. The litigation over those items has now drawn the legal arms of two retail casinos in Pennsylvania.
Those casinos have jointly filed an amicus brief supporting Pennsylvania’s request for the state’s Supreme Court to review a recent lower court decision. There is much more at stake than the status of those machines, that bag of cash, and those paper receipts.
The winding road to the amicus brief
The story of this dispute begins in December 2019. That’s when law enforcement officers seized the gaming terminals, cash, and receipts at Champions Bar in Highspire, Pennsylvania. Following that seizure, Champions received an administrative citation for offering illegal gambling in April 2020.
The distributor of those terminals, Pace-O-Matic (POM) filed a petition with the Dauphin County Court of common pleas in August 2022. In its petition, POM argued that the terminals are games of skill and not of chance and therefore do not fit the definition of gambling under Pennsylvania law.
In March 2023, that court granted the request of the petition, ordering the state to return the property to Champions. The state appealed the common pleas court ruling, sending the dispute to a commonwealth court.
On Nov. 30, 2023, the commonwealth court upheld the decision of the common pleas court, also ordering law enforcement to return the property to Champions. In this particular matter considering a bank bag, gaming machines, and receipts, the only place left for the state to go is the Pennsylvania Supreme Court.
Parx casinos in Bensalem and Shippensburg would like to see the Pennsylvania Supreme Court take up the case. That premise is loaded with both reward and risk for the casinos’ stated interests.
Parx casinos weighed in to protect skill games revenue
While Pennsylvania awaits a decision on whether the Pennsylvania Supreme Court will review the case, Parx casinos in the state have tried to urge the court that way. According to Corey Sharp of PlayPennsylvania, the Parx casinos aren’t alone in this interest.
A dozen other brick-and-mortar casinos in Pennsylvania signed onto the amicus brief in support of the state’s appeal. An amicus brief is a document filed in a civil lawsuit by an uninvolved party supporting a motion that one of the parties to the case has made.
Sharp reports that the brief states that:
“The Commonwealth Court’s ruling opens the floodgates for unlicensed, unregulated, unlawful slot machines to dominate Pennsylvania’s gaming landscape in a manner the General Assembly sought to prevent.”
Additionally, Sharp quotes Parx Casino’s Chief Legal Officer, Karin Ashford, as stating that the casinos “cannot and should not be expected to compete with skill games which pay zero gaming taxes, create no meaningful employment, and are not subject to any licensing or oversight.”
It’s unclear how soon the Pennsylvania Supreme Court will decide whether or not to take up the case. Even more uncertain is how Pennsylvania will fare before the court in this matter should the court grant the review.
What is certain is that even if the Pennsylvania Supreme Court does review the case, its ruling may not be the final word on the legality of skill games in the state either way.
The path forward for Pennsylvania’s appeal
At this time, there are a few potential ways the state’s appeal could play out. The first of those is that the Supreme Court denied the state’s petition to review the case. Should that happen, the commonwealth court’s order would become the final word in this matter. At least for the time being.
Should the Pennsylvania Supreme Court decide to review the case, it can either:
- Uphold the commonwealth court’s decision
- Or find that the court erred in its actions
Should it do the latter, that wouldn’t necessarily mean a clear victory for the state, though.
While the court could simply overturn the commonwealth court’s ruling and make one of its own on the merits of the case, it could also simply order the commonwealth court to re-hear the case with specific instructions on a certain aspect of the case.
The weight of the Pennsylvania Supreme Court potentially participating in this dispute is more substantial than the weight of those three gaming terminals.
This lawsuit is not about a bank bag and some computers
As one would expect, the state Supreme Court is not getting involved in a dispute about $525 in cash, three machines, and seven receipts. This dispute is about the legality of skill games in Pennsylvania, which casinos see as competition, not Champions’ bank bag.
There have already been several court rulings in favor of such gaming. Commonwealth courts in both Clearfield County and Monroe County have ordered law enforcement to return similar property to businesses in 2021 and 2022.
Thus, a favorable ruling for POM at the Pennsylvania Supreme Court would strengthen that precedent considerably. Barring intervention by the state legislature, it would make skill games legal in Pennsylvania on a de facto basis.
On the other hand, a strong ruling from the Pennsylvania Supreme Court in favor of the state could undo much of the power of that precedent. In the end, though, another body in Harrisburg may have more to say on this matter.
Pennsylvania’s legislature may join the party
In August 2023, a Pennsylvania Senate committee held a hearing on the issue of skill games in the state. That hearing has not yet led to any new bills being filed although there have been prior attempts to clarify the situation through legislation.
In a twist of irony, the legislature and governor enacting legislation to ban or restrict skill gaming in Pennsylvania would probably put the matter right back before the courts. In other states that have tried to ban such games, POM has been quick to challenge the constitutionality of such laws.
While a law that legalizes and regulates such games would probably have POM’s support, it would fly in the face of Pennsylvania casinos. They might similarly launch a court challenge to such a law. The bottom line is that this dispute could still take years to settle.
The state’s appeal of the dispute over a bank bag, $525 in cash, seven receipts, and three computers is just the latest chapter in this drama.
