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Cash-prize gaming machines were banned by the city earlier this year.
SBJ file
Cash-prize gaming machines were banned by the city earlier this year.

SPD issues 36 citations to businesses for violating city’s gaming machine ban

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Officers from the Springfield Police Department have issued 36 citations to businesses for violating the city’s ban of cash-prize gaming machines.

A news release from the city named 26 businesses that received at least one citation since the ordinance was enacted. Included on the list issued yesterday were convenience stores, smoke and vape shops, a bar and a grocery store. The release said officers with the department’s Community Services Section have been tasked with checking for compliance with the new ordinance and enforcing it.

The full list of cited businesses accompanies this story. 

On Feb. 12, Springfield City Council passed an ordinance banning entertainment devices offering monetary prizes within the city. The morning after the ordinance passed, Chief Paul Williams confirmed in an interview with Springfield Business Journal that enforcement would begin immediately.

Under the ordinance, violating businesses are fined $500 per machine for a first offense and $1,000 per machine for a second offense. For a third offense, the ordinance calls for an additional fine of $1,000 per machine plus a minimum jail sentence of 30 days, and the court is restricted by the ordinance from suspending this minimum sentence.

A spokesperson from SPD declined to clarify whether any of the 36 citations issued were for second or third offenses.

In his Feb. 13 interview, Williams said the top priority would be those businesses that specialize in the entertainment devices.

“The top priority would be those places that are unique – the video gaming centers where nothing but this is going on,” Williams said at the time. “Then we’ll move on to those that have them as an extracurricular part of the business.”

Gaming centers were not included on yesterday’s list released by SPD. However, on March 19, multiple law enforcement agencies, including SPD and the FBI, were witnessed conducting simultaneous raids at several locations throughout the city, and video gaming centers were included in the sweep.

Asked about the raids, in an email, SPD Public Affairs Officer Cris Swaters said only a multiagency investigation is underway and deferred further comment to Don Ledford, spokesperson for the U.S. attorney’s office for the Western District of Missouri. He told SBJ  he had no information to provide and no criminal charges have been filed.

Witness reports of the March 19 raids popped up on community crime-watch pages on Facebook, with accounts of some electronic gaming machines being removed from businesses. An SBJ staffer witnessed similar activity in person at a former Family Video store on the corner of Scenic Avenue and Mount Vernon Street.

KY3 reported on raids at Lucky 7’s and Big Win gaming rooms, at 1842 and 1928 S. Glenstone Ave. and 1135 E. Commercial St., respectively, as well as other addresses, including a home. The addresses reported by the station were the 1700 block of South Link Avenue, the 600 block of South Scenic Avenue, the 500 block of West Bypass (two locations), 634 E. Walnut Lawn St. and 1322 E. Grand St.

KY3 reported the FBI claimed to be involved in all the raids but did not give a reason for them. SPD confirmed to the station that the raids were related but did not offer other details except to say it was a multijurisdictional investigation.

At a Feb. 6 council meeting, Councilmember Callie Carroll asked Williams for an update on enforcement of the ordinance, but Mayor Ken McClure told Carroll that’s a question council should not ask.

Lawsuit filed
Wildwood, Missouri-based Torch Electronics LLC, which manufactures the devices banned by the city ordinance, filed a lawsuit against the city of Springfield in Greene County Circuit Court on Feb. 29.

In the court filing, the company seeks an injunction and declaratory judgment against the city and states that its machines are legal and the businesses using them are law abiding.

The lawsuit takes issue with the law and its enforcement efforts and asks the court to put an end to them.

“Torch Electronics LLC brings this action to restrain the city of Springfield from exceeding its authority in enacting and enforcing an ordinance that does not apply to Torch, effectively banning lawful Torch coin-operated amusement machines in law-abiding businesses across the Springfield community,” the petition states.

The document explains that the machines are placed in businesses pursuant to license agreements that lease space to the company to operate them.

It also declares that use of the machines does not constitute gambling.

“By using the coin-operated amusement machines, customers of local businesses play games that are within their control and are not for gambling,” the petition states. “Under Missouri statutes, such coin-operated machines are legal and, in fact, are validly licensed by the city of Springfield.”

The filing adds that Torch pays the city $5 annually for each machine that is operated in the city, and the city’s director of finance issues licenses for them. Every machine operating in the city has been licensed since 2019, it states.

The filing builds an argument that game play is not a form of gambling.

It explains that to use a Torch machine, a customer inserts money and is prompted to play a game.

“Torch’s coin-operated amusement machines allow the customer to see the results of the game before the customer puts money in the machine, and before they play the game,” it states.

It adds that outcomes on the machines are “predetermined, finite and in sequential order” and are not determined by an element of chance.

“These predetermined outcomes cannot be altered and, thus, are not competitive and nor are they games of chance,” the petition states. “A customer knows the outcome before they decide to play the game and before they must commit their money.”

It adds that the machines do not award a prize, under the dictionary definition of the term. The complaint cites a Merriam-Webster dictionary definition of prize as meaning “something offered or striven for in competition or in contests of chance.” But it notes that Torch machines are not competitive and do not rely on chance. By this definition, the machines do not offer prizes, according to the lawsuit.

The suit alleges that the city has issued citations to clerks in convenience stores and gas stations while demanding they immediately disable machines.

“The aforementioned non-managerial store clerks have no authority to turn off, remove, offer for use or otherwise maintain plaintiff’s coin-operated amusement machines and, in fact, are directed to not otherwise interfere with plaintiff’s coin-operated amusement machines,” the complaint states.

Torch also claims enforcement efforts violate its due process rights, rendering its licenses ineffective and offering no opportunities for its concerns to be heard.

The company also cites a void-for-vagueness doctrine in the suit, noting the definitions of devices are vague enough that they may encompass operators of children’s arcades, e-sports gaming lounges, radio giveaways and fair attractions. This vagueness encourages arbitrary and discriminatory enforcement, the suit claims.

A trial date does not appear on the Missouri Courts website, but a motion hearing is set in Missouri’s 31st Judicial Circuit for 2:30 p.m. April 24 by Associate Circuit Judge Nathan Taylor.

Cora Scott, Springfield’s director of public information, said the city does not comment on pending litigation. Likewise, Torch Electronics did not respond to a written request for comment.

State legislation
State gubernatorial candidate and Missouri House Minority Floor Leader Crystal Quade, D-Springfield, in February proposed House Bill 2835, which would legalize the type of games in question, referred to as video lottery terminals in the bill, and would regulate and tax them. The bill also would allow cities and counties to ban the machines.

The bill stipulates that the state Lottery Commission would implement a licensing structure for the games. It also requires mechanical amusement devices to be connected to a centralized computer system.

Under the bill, persons may exclude themselves from game play by adding their name to a confidential list maintained by the Lottery Commission. It also limits the maximum wager to $5 and the maximum payoff to $1,100.

Additionally, 33% of adjusted gross receipts earned from game play would be deposited into the state’s Lottery Fund, in part to pay for administrative costs.

Quade’s bill has had two readings, but a further hearing is not scheduled, and the bill is currently not on a calendar in the House of Representatives, according to the House website.

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