In a unanimous decision, the Commonwealth Court of Pennsylvania ruled that machines manufactured by Pace-O-Matic (POM) are skill games, not illegal slot machines. The decision marks the second major victory for the manufacturer in the state this year. The verdict upholds a county judge’s decision in February, which likewise deemed the machines to be games of skill.
Judge Lori A. Dumas wrote in the opinion that POM’s machines are “not slot machines as commonly defined.”
According to the court, the terminals are not gambling devices as defined in the state’s Gambling Act. That means they’re not prohibited by that specific law.
Could Ruling Help PA Clarify the Machines’ Status?
Despite siding with POM, the court didn’t rule definitively on the legal status of the machines. It established that the Gaming Act doesn’t apply to them, but that isn’t the same as asserting their legality. It could, however, spur Pennsylvania lawmakers to pass legislation to clarify the issue.
That could be easier said than done as state lawmakers are divided on how to address the issue. Some, like state Sen. Amanda Cappelletti and Rep. Mark Rozzi, want the machines banned. Others, including state Sen. Gene Yaw, want to regulate and tax them.
A month before the court’s decision, Cappelletti and Rozzi revealed plans for a bill banning skill game terminals. The two lawmakers argued that the machines amount to unregulated slots, a claim now contradicted by the appellate court. They add that skill game terminals are untaxed, unlike real money slot machines—which are taxed at 54%—or video gaming terminals—at 52%.
Meanwhile, in April, Sen. Yaw introduced a bill that would regulate skill machines. While it hasn’t moved from committee since May, that bill may move now with the court’s decision. Regulation is something POM representatives also called for after their court victory.
POM’s Chief Public Affairs Officer, Michael Barley, urged the General Assembly to pass “reasonable legislation” that will benefit small businesses and generate tax revenue for the state. Barley called regulation a “win-win for the commonwealth.”
Could POM Also Win in KY?
While it celebrates in Pennsylvania, POM remains in a legal battle in Kentucky. In March, the state banned skill game terminals, with the ban coming into effect July 1. POM and other plaintiffs, including small business owners, responded with a lawsuit, calling the ban unconstitutional. The plaintiffs accuse the state of several violations, including due process and free speech.
There haven’t been any updates on the lawsuit, but it will be interesting to see which way Kentucky judges would lean, given recent rulings elsewhere. While Pennsylvania courts have ruled in favor of POM, the Virginia Supreme Court recently upheld a ban similar to Kentucky’s.
The Supreme Court panel of three judges said that a lawsuit challenging the ban would not likely succeed because the General Assembly changed the definition of skill games this year. The panel also said skill games don’t fall under free speech, one of POM’s arguments in Kentucky.