I am so tired of this subject, as I know most of you are, but I have a quick question for you 8-liner gurus....

I have an 8-liner owner who is insisting that accumulation of points on an 8-liner machine is permissable in order to win larger prizes (worth more than $5). He compares the way he operates his 8-liner machines to the way ChuckECheese and Dave and Busters operate their games. In addition, he produced a copy of an Agreed Final Judgment out of Cameron County in an 8-liner case that says accumulation of points is permitted. However, I have been unable to find any caselaw that establishes his point.

Do any of you have any insight on this subject? Is accumulation of points okay in order to win prizes worth more than $5, and I'm just missing it somewhere?

[This message was edited by MSpacek on 05-11-07 at .]

[This message was edited by MSpacek on 05-11-07 at .]

I can see the argument going either way, depending on the judge. The statute, after all, says that the device must reward players with a noncash merchandise prize, toy or novelty, or a representation of value redeemable for those items, that has "a wholesale value available from a single play of the game or device of not more than 10 times the amount charged to play the game or device once or $5, whichever is less." The problem area I have consistently wrestled with is the amount charged to play and the potential reward for a high-stakes bet.

Specifically, a "penny" machine charges one cent for each credit. The minimum bet on most penny machines is eight credits (meaning eight cents). Under those facts, it could be argued that the maximum allowable win for one play of the device would be 80 cents. Of course, the countering argument is the "amount charged to play the game or device" is whatever the player chooses to wager, so long as the payout for a single play doesn't exceed $5. We haven't had a judge decide the issue yet, since most of our defendants have awarded players cash or a cash equivalent.

The other issue our judges haven't yet decided is the fact that 8-liners, by their very operational nature, record and register bets. That would seem to make them "gambling paraphernalia" under section 47.01(6), obviating the convolutions of section 47.01(4)(B). In the run-up arguments I've had with 8-liner defense counsel, they urge that the gambling paraphernalia definition cannot be applied because of the in pari materia doctrine. It is notable that the El Paso Court of Appeals has affirmed a conviction of an 8-liner operator for possession of gambling paraphernalia, but the opinion doesn't directly confront the in pari materia argument. See McAnally v. State, No. 08-01-00137, 2002 WL 358828, at *4 (Tex. App.--El Paso Mar. 7, 2002, no pet.)(not designated for publication).

I'll be interested to see what others think about this issue.

See AG Opinion GA-0527 dated March 6, 2007 for info on "a stored-value debit card is a gambling device."

We have always taken the position that amounts may not be accumulated. If you win ten (10) $0.80 prizes, you get ten (10) $0.80 prizes...not one (1) $8.00 prize.

We base our reasoning on the language in the statute which requires that players be rewarded "exclusively with noncash merchandise prizes, toys, or novelties...that have a wholesale value available from a single play of the game or device of not more than 10 times the amount charged to play the game or device once or $5.00, whichever is less." If the player is rewarded with a "representation of value," it must be "redeamable for those items," which relates back to the value-capped "noncash merchandise." If a player could accumulate "representations of value," he would no longer be being rewarded with value-capped "noncash merchandise."

And whoever said Dave & Busters, Chuck E. Cheese, Gattiland, et al, were NOT breaking the law? We send them the same cease and desist letters that we send to the Gold Bonanzas, Lucky 7's and Vegas Videos. We give them two options: quit allowing players to accumulate credits on games of chance, or award different prizes for the skill games vs. the chance games.

[This message was edited by John C. Grace on 05-14-07 at .]

That's along the lines of what I was thinking, John. Glad to hear that I am not losing my mind (this time)!

Thanks for your replies!

[This message was edited by MSpacek on 05-14-07 at .]

John, it's good to hear your take on the valuation issue. I agree with you. That hasn't prevented me from being called some rather unflattering things, "incompetent" being among the nicer of them. I suppose the equivocal nature of my response may have been a partial result of that.

We also have consistently told anyone who would listen (and very few do) that an illegal machine at Chuck E. Cheese's is no more lawful because of its overstimulating environment than one located at Vegas Slots. But at least the kiddie joints offer de minimis prizes. A plastic lizard may fit within sec. 47.01(4)(B). A plasma TV almost assuredly comes no closer to passing muster than cash. In that vein, I'm intrigued by your suggestion to differentiate prizes available from chance games from those avaiable from skill games.

P.S. Do I win some sort of prize for using the same preposition in the preceding sentence not once or twice, but three times?

Grand jury indicts 20 with connections to 'eight-liner' operations

BY HENRI BRICKEY
AVALANCHE-JOURNAL

A Lubbock County grand jury on Tuesday indicted 20 people on charges connected with "eight-liner" operations.

The indictments come almost two months after police served 11 search warrants and seized $500,000 in late-night raids targeting illegal gambling in and around Lubbock.

The raids, which involved more than 100 personnel from the Lubbock Police Department, Texas Department of Public Safety and investigators from the Criminal District Attorney's Office, targeted "eight-liner" gaming businesses.

Investigators served the search warrants at nine businesses and at two homes, one in Lubbock and one in Ransom Canyon.

Those indicted Tuesday range in age from 19 to 62 years old.

Eight individuals were indicted on charges of money laundering, including Joseph Menaldi, 45; Phyllis Grant, 62; Adam Menaldi, 19; Heather Menaldi, 20; Joseph E. Menaldi, 25; Manuela P. Menaldi, 44; John E. Smith Jr., 40; and John E. Smith, 59,

And 12 people were indicted on organized crime and gambling charges: Kennison L. Dubberly, 19; Brittnie N. Smith, 23; Esiquio Carrizales, 43; Blanca E. Cruz, 34; Leticia P. Cruz, 35; Mildred S. Gooch, 54; Cindy B. Madrid, 35; Santiago Martnez, 57; Victoria V. Torres, 44; Daisy M. Guerrero, 26; Gloria T. Guerrero, 54; and Julie Guerrero, 31.

To operate legally, game room managers cannot award winners with cash or prizes valued at more than $5, according to prosecutors.

Investigators uncovered some instances of players winning several hundred thousand dollars from local "eight-liner" game rooms, prosecutors said.