The video sweepstakes ban attempts to outlaw games in which people purchase a service, such as Internet access or telephone calling card minutes, and in the process enter a gambling-style sweepstakes game played on a computer screen. Customers usually focus on the gambling and winning money, and rarely pay attention to the service they have purchased.
Since Dec. 1, the Lucky Charm Internet Cafe on Hope Mills Road closed temporarily to install new games, said owner Ann Drabek.
Where the cafe once had about 10 "pot-of-gold" machines and 12 Internet terminals, it now has just the 12 terminals. The new games on the terminals have changed their rules and use less flashy graphics.
The constitutional section of the law bans sweepstakes video games that resemble popular gambling games, such as card games, bingo, keno and slot machines. Other games that involve the random or chance matching of two or more words, pictures or other symbols also are illegal.
The new games got a mixed reception from players. One woman, so shy about her playing that she took a seat away from the store windows, said she likes the simplicity of the new games. Whereas the games used to require her to play cards or to match several pictures to win, now she wins when just one picture of a lucky horse shoe or elf's pipe appears on the screen.
"It's nice, because I didn't know how to play cards anyway," said the woman, who declined to be identified.
But Chris Edge of Fayetteville misses the old games.
"It's not as much fun as it was before," he said. New games feel slower and have less excitement, he added.
Drabek, the owner, re-opened the cafe Tuesday. She estimates her business is down 50 percent compared to before Dec. 1.
The Sheriff's Office is handling enforcement of the law in the county, plus Hope Mills, Spring Lake, Eastover and Stedman, said spokeswoman Debbie Tanna. The department will investigate complaints, she said, and was visiting the cafes to monitor their compliance. But the Sheriff's Office has since stopped while it waits for the courts to rule on the ban's constitutionality.
"We will not start visiting again until the law is defined," Tanna said.
Butler made this decision in consultation with other sheriffs, Tanna said.
"When they are ready to move on this law, they will do so as a group," she said.
Sunday, December 12, 2010
Thursday, October 28, 2010
Video Gaming Company drops Lawsuit Against Morgantown
Morganton --
The two software companies who sued the city of Morganton because of the business license fee it charges Internet sweepstakes cafes have dismissed the lawsuit. Attorneys for the two companies requested a voluntary dismissal of the lawsuit. They asked the court to do so “without prejudice,” which means they could re-file the lawsuit within the next 12 months.Meanwhile, lawyers for both sides are watching a separate lawsuit filed last month in Cumberland County Superior Court by 13 Internet cafe owners in Fayetteville who are fighting the license fees on constitutional and other grounds.International Internet Technologies and Hest Technologies filed suit in early August against Morganton, Fayetteville, Lumberton, Pembroke and Wilmington. The lawsuit alleged the cities’ business license fee, or privilege license, violates the federal Internet Tax Freedom Act. The act prevents local and state governments from taxing Internet access.The lawsuit ended up in business court before Judge Ben F. Tennille.The cities named in the lawsuit contended that because the two software companies weren’t paying the privilege fees — the fees only apply to local business operators — they didn’t have a dog in the fight, said Steve Settlemyer, attorney for the city of Morganton. Settlemyer also said he doesn’t believe the Internet Tax Freedom Act applies to privilege licenses. During depositions taken in the case, he pointed out, lawyers for the companies said people don’t have to go on the Internet to reveal a sweepstakes win and that the games are a local server-based program. The city has spent around $8,000 so far to retain an attorney who regularly practices in business court to fight the lawsuit, Settlemyer said. The Kilpatrick Stockton law firm in Winston-Salem represented IIT. Attorney Richard Gottlieb said the company decided to dismiss the lawsuit because of the similar suit filed against the city of Fayetteville. He said it made more sense to his clients and was more efficient to allow the Fayetteville case to proceed and then consider their options. Gottlieb said IIT is not a party to the lawsuit against Fayetteville. According to the Fayetteville Observer, the Cumberland County Superior Court judge in that case granted a preliminary injunction to block the city’s ability to collect the fees from those owners until the case is settled, either by trial or out of court. Gottlieb and Settlemyer both said they want to see how that lawsuit is resolved.In the meantime, Settlemyer said, Internet sweepstakes gaming operators have to pay the privilege license in Morganton. Settlemyer said that of the 17 operating in the city in the spring, 10 paid Morganton’s privilege license, three got rid of their machines and one closed up shop. Two have yet to pay the fee, he continued. The combined total due is $58,050. The Morganton City Council voted in May to require businesses who offer video gaming to pay for a privilege license. It costs $2,000 per business and $1,500 per machine (city staff originally proposed $2,000 and $2,500). City officials projected the 2010-11 municipal budget would get $125,000 for the Internet sweepstakes cafe privilege license. Settlemyer said that if the two businesses don’t pay the privilege license fee, the city could file a lawsuit to collect the money or the city could get a court order to close down the businesses. Those offering the Internet sweepstakes gaming say they provide a way for people to access the Internet for e-mail, social networking, entertainment and religious purposes. They say they use the sweepstakes to promote their business. Opponents say the operators — whether they call themselves Internet cafes, business centers or something else — are nothing more than gambling parlors.The North Carolina General Assembly voted on July 7 to outlaw the electronic sweepstakes gaming. The law is scheduled to take effect Dec. 1. Gottlieb said he and his clients believe the law the General Assembly passed is unconstitutional because it infringes on the First Amendment right of free speech and, specifically, on the way the sweepstakes can be played and displayed.
The two software companies who sued the city of Morganton because of the business license fee it charges Internet sweepstakes cafes have dismissed the lawsuit. Attorneys for the two companies requested a voluntary dismissal of the lawsuit. They asked the court to do so “without prejudice,” which means they could re-file the lawsuit within the next 12 months.Meanwhile, lawyers for both sides are watching a separate lawsuit filed last month in Cumberland County Superior Court by 13 Internet cafe owners in Fayetteville who are fighting the license fees on constitutional and other grounds.International Internet Technologies and Hest Technologies filed suit in early August against Morganton, Fayetteville, Lumberton, Pembroke and Wilmington. The lawsuit alleged the cities’ business license fee, or privilege license, violates the federal Internet Tax Freedom Act. The act prevents local and state governments from taxing Internet access.The lawsuit ended up in business court before Judge Ben F. Tennille.The cities named in the lawsuit contended that because the two software companies weren’t paying the privilege fees — the fees only apply to local business operators — they didn’t have a dog in the fight, said Steve Settlemyer, attorney for the city of Morganton. Settlemyer also said he doesn’t believe the Internet Tax Freedom Act applies to privilege licenses. During depositions taken in the case, he pointed out, lawyers for the companies said people don’t have to go on the Internet to reveal a sweepstakes win and that the games are a local server-based program. The city has spent around $8,000 so far to retain an attorney who regularly practices in business court to fight the lawsuit, Settlemyer said. The Kilpatrick Stockton law firm in Winston-Salem represented IIT. Attorney Richard Gottlieb said the company decided to dismiss the lawsuit because of the similar suit filed against the city of Fayetteville. He said it made more sense to his clients and was more efficient to allow the Fayetteville case to proceed and then consider their options. Gottlieb said IIT is not a party to the lawsuit against Fayetteville. According to the Fayetteville Observer, the Cumberland County Superior Court judge in that case granted a preliminary injunction to block the city’s ability to collect the fees from those owners until the case is settled, either by trial or out of court. Gottlieb and Settlemyer both said they want to see how that lawsuit is resolved.In the meantime, Settlemyer said, Internet sweepstakes gaming operators have to pay the privilege license in Morganton. Settlemyer said that of the 17 operating in the city in the spring, 10 paid Morganton’s privilege license, three got rid of their machines and one closed up shop. Two have yet to pay the fee, he continued. The combined total due is $58,050. The Morganton City Council voted in May to require businesses who offer video gaming to pay for a privilege license. It costs $2,000 per business and $1,500 per machine (city staff originally proposed $2,000 and $2,500). City officials projected the 2010-11 municipal budget would get $125,000 for the Internet sweepstakes cafe privilege license. Settlemyer said that if the two businesses don’t pay the privilege license fee, the city could file a lawsuit to collect the money or the city could get a court order to close down the businesses. Those offering the Internet sweepstakes gaming say they provide a way for people to access the Internet for e-mail, social networking, entertainment and religious purposes. They say they use the sweepstakes to promote their business. Opponents say the operators — whether they call themselves Internet cafes, business centers or something else — are nothing more than gambling parlors.The North Carolina General Assembly voted on July 7 to outlaw the electronic sweepstakes gaming. The law is scheduled to take effect Dec. 1. Gottlieb said he and his clients believe the law the General Assembly passed is unconstitutional because it infringes on the First Amendment right of free speech and, specifically, on the way the sweepstakes can be played and displayed.
Thursday, July 8, 2010
N.C. House expected to vote to close video gambling loophole
THE FAYETTEVILLE OBSERVER 08:16 AM, Wed Jul 07, 2010
North Carolina lawmakers are poised to try again to kill the state's burgeoning video sweepstakes gambling industry. The House of Representatives is scheduled to vote today on a bill to ban the gambling games, which are played in lounges and other locations throughout the state. The ban previously passed the state Senate by a vote of 47-1. Gambling industry lobbyist Brad Crone expects the ban to pass despite the industry's request that it be allowed to stay in business and be taxed and regulated. The ban would take effect Dec. 1.
Read More
North Carolina lawmakers are poised to try again to kill the state's burgeoning video sweepstakes gambling industry. The House of Representatives is scheduled to vote today on a bill to ban the gambling games, which are played in lounges and other locations throughout the state. The ban previously passed the state Senate by a vote of 47-1. Gambling industry lobbyist Brad Crone expects the ban to pass despite the industry's request that it be allowed to stay in business and be taxed and regulated. The ban would take effect Dec. 1.
Read More
Sunday, July 4, 2010
Wednesday, June 2, 2010
City Capital Adds Three More Gaming Centers to Clean Sweeps Family
RALEIGH, NC--(Marketwire - June 1, 2010) - City Capital Corporation (PINKSHEETS: CTCC) today announced that its sweepstakes gaming subsidiary Clean Sweeps Holdings, LLC has now further expanded into the state of North Carolina with the addition of three sweepstakes gaming center locations. The three gaming centers currently operating Clean Sweeps hardware and software are located in the municipalities of Rolesville, Walnut Cove, and Kernersville. The locations represent approximately seventy additional Clean Sweeps terminals in operation, or under Clean Sweeps management.
Ephren Taylor, Chief Executive Officer of City Capital Corporation, stated, "In 2009 we laid out an aggressive plan to roll out thousands of our terminals into concentrated areas, these three locations represent the tip of our expansion into the Southeast. We look forward to adding new locations running our systems every month as we continue to grow this division."
Clean Sweep Holdings' games allow players to win cash or other prizes at terminals located in shopping centers and kiosks. The games attract players of all types, diversifying the clientele that frequent retail business entities. Comparable to the McDonald's Monopoly gaming concept, Sweepstakes Income games are 100% legal, yet they offer far more feasible probabilities for achieving victory. And perhaps more significantly, owners of Sweepstakes gaming machines regularly experience significant, rapid revenue generation that is simplistically sustainable.
read entire story
Ephren Taylor, Chief Executive Officer of City Capital Corporation, stated, "In 2009 we laid out an aggressive plan to roll out thousands of our terminals into concentrated areas, these three locations represent the tip of our expansion into the Southeast. We look forward to adding new locations running our systems every month as we continue to grow this division."
Clean Sweep Holdings' games allow players to win cash or other prizes at terminals located in shopping centers and kiosks. The games attract players of all types, diversifying the clientele that frequent retail business entities. Comparable to the McDonald's Monopoly gaming concept, Sweepstakes Income games are 100% legal, yet they offer far more feasible probabilities for achieving victory. And perhaps more significantly, owners of Sweepstakes gaming machines regularly experience significant, rapid revenue generation that is simplistically sustainable.
read entire story
Sweepstakes Video Parlors Grow From Virginia To Florida
Internet-enabled sweepstakes videogames that pay cash prizes are cropping up from Florida to Virginia, leaving city and state officials in a quandary about how to respond. The games have long flourished in North Carolina, where House Speaker Joe Hackney (D-Chapel Hill) recently predicted the state legislature might amend the law to ban video sweepstakes games if the courts fail to do so. At least two district court judges have upheld the legality of the machines in North Carolina.
But now payoff sweepstakes games -- many located in Internet cafés -- have begun to proliferate elsewhere up and down the Eastern seaboard. In Florida, 400 people jammed a city council meeting in Jacksonville this month to debate the status of the games. As Internet sweepstakes gamerooms increase throughout the state, enforcement policies vary from one county to the next, and sometimes within a single county, according to local press sources.
Read Entire Story
But now payoff sweepstakes games -- many located in Internet cafés -- have begun to proliferate elsewhere up and down the Eastern seaboard. In Florida, 400 people jammed a city council meeting in Jacksonville this month to debate the status of the games. As Internet sweepstakes gamerooms increase throughout the state, enforcement policies vary from one county to the next, and sometimes within a single county, according to local press sources.
Read Entire Story
Wednesday, May 26, 2010
North Carolina asks Where do you draw the line on gambling?
One of the biggest gambling issues in North Carolina involves the proliferation of those Internet sweepstakes parlors where computerized versions of slot machines, video poker, keno and many more games can be accessed.Mount Airy is now home to at least five of those businesses, mirroring a trend across the state that has posed a quandary for lawmakers unsure of how to deal with the practice. Part of the problem seems to be the distinction between computer servers used by the Internet cafes and actual gambling devices such as video poker machines which clearly are outlawed.Read more: Mount Airy News - Where do you draw the line on gambling
Asheville NC passes some limits on video sweepstakes
City Council passed some restrictions on so-called “video sweepstakes” machines Tuesday, but put off other rules for six months. The machines are close cousins to video gambling machines banned in North Carolina in 2007 except at the casino in Cherokee. They are now cropping up around the state and locally in convenience stores and stand-alone parlors.
The council voted 4-3 to set a $1,000 application fee and $2,500 fee per machine. Mayor Terry Bellamy and councilmen Jan Davis and Bill Russell voted no. The following passed 6-1 with Russell dissenting: restricting large operators from residential areas and most other zoning districts but allowing smaller operators in community business districts; setting the cap at 20 machines per establishment; and giving businesses 180 days to comply. Read Story
The council voted 4-3 to set a $1,000 application fee and $2,500 fee per machine. Mayor Terry Bellamy and councilmen Jan Davis and Bill Russell voted no. The following passed 6-1 with Russell dissenting: restricting large operators from residential areas and most other zoning districts but allowing smaller operators in community business districts; setting the cap at 20 machines per establishment; and giving businesses 180 days to comply. Read Story
North Carolina proposes that Lottery Commission oversee video gambling
The state lottery would have a little brother in North Carolina, if state Sen. Julia Boseman gets her way. The Democratic senator from New Hanover County is sponsoring legislation that would allow video gambling in North Carolina to be overseen by the N.C. Lottery Commission.
The Video Gaming Entertainment Act would allow gambling machines, provided they are licensed, regulated and their proceeds taxed by the state, according to a draft bill released by Boseman’s legislative office on Tuesday. Read Story
The Video Gaming Entertainment Act would allow gambling machines, provided they are licensed, regulated and their proceeds taxed by the state, according to a draft bill released by Boseman’s legislative office on Tuesday. Read Story
Asheville City Council to consider restrictions on 'video sweepstakes'
ASHEVILLE — City Council will consider today an ordinance that might slow the growth of so-called “video sweepstakes” machines around Asheville. The machines are close cousins to video gambling machines that North Carolina banned as of July 2007 except at the casino in Cherokee. They are turning up around Buncombe County and the state in convenience stores and other businesses, including stand-alone video sweepstakes parlors in some cities.
Proposed city rules would limit the machines to commercial zoning districts allowing more intense use, prohibit them close to homes, schools and places of worship, and require owners to pay a $2,500 fee for a business license plus $500 per machine. Read entire Story
Proposed city rules would limit the machines to commercial zoning districts allowing more intense use, prohibit them close to homes, schools and places of worship, and require owners to pay a $2,500 fee for a business license plus $500 per machine. Read entire Story
Wednesday, May 19, 2010
City council honors former member, regulates Internet cafes
5/19/2010
ROANOKE RAPIDS — Roanoke Rapids City Council honored one of their former members and moved forward on regulations regarding Internet cafes in the city Tuesday night during the Council’s regular meeting at Lloyd Andrews City Meeting Hall.
The new ordinance goes on to restrict locations — must be 500 feet minimum distance from any residence or residential zoning district, 1,000 feet minimum distance from a church, day care center, elementary school or secondary educational school, public park or playground, public library, cemetery, video arcade, or cinema showing G or PG-rated movies regularly. The 1,000-foot minimum distance also applies to other Electronic Gaming Operations, tattoo or piercing establishments, or sexually-oriented businesses.The new regulations limit the number of machines for each establishment at 20, and no alcohol may be served or consumed on the premises. Read entire story
ROANOKE RAPIDS — Roanoke Rapids City Council honored one of their former members and moved forward on regulations regarding Internet cafes in the city Tuesday night during the Council’s regular meeting at Lloyd Andrews City Meeting Hall.
The new ordinance goes on to restrict locations — must be 500 feet minimum distance from any residence or residential zoning district, 1,000 feet minimum distance from a church, day care center, elementary school or secondary educational school, public park or playground, public library, cemetery, video arcade, or cinema showing G or PG-rated movies regularly. The 1,000-foot minimum distance also applies to other Electronic Gaming Operations, tattoo or piercing establishments, or sexually-oriented businesses.The new regulations limit the number of machines for each establishment at 20, and no alcohol may be served or consumed on the premises. Read entire story
Lawmaker told video poker could net $576M for North Carolina
5/21/2010
RALEIGH, N.C. — The North Carolina Education Lottery says the state could one day generate $576 million annually if lawmakers legalize video poker machines again and regulate them heavily. The lottery released on Wednesday its analysis for a state senator who sought information on state revenues that could originate from casino-style video gambling games.
Read entire story
RALEIGH, N.C. — The North Carolina Education Lottery says the state could one day generate $576 million annually if lawmakers legalize video poker machines again and regulate them heavily. The lottery released on Wednesday its analysis for a state senator who sought information on state revenues that could originate from casino-style video gambling games.
Read entire story
North Carolina Town looks at sweepstake machine fees
May 19, 2010
The Town of Black Mountain is considering a fee on sweepstakes machines, video terminals on which participants can play poker, blackjack, and other games traditionally associated with gambling. Read story
The Town of Black Mountain is considering a fee on sweepstakes machines, video terminals on which participants can play poker, blackjack, and other games traditionally associated with gambling. Read story
North CarolinaLawmakers Could Consider Legalizing Video Poker Machines
5/20/2010
The North Carolina Education Lottery says the state could one day generate $576 million annually if lawmakers legalize video poker machines again and regulate them heavily. The lottery released its analysis yesterday. Read entire story
The North Carolina Education Lottery says the state could one day generate $576 million annually if lawmakers legalize video poker machines again and regulate them heavily. The lottery released its analysis yesterday. Read entire story
Wednesday, April 21, 2010
Gaming case going to court
By Sharon McBrayer The News Herald
Published: April 18, 2010
MORGANTON - A Superior Court judge on Monday will hear a complaint filed against local law enforcement officers, the district attorney and the state of North Carolina.
Thirteen Burke County businesses want the court to issue a preliminary injunction that prohibits police, the sheriff's office and the DA from interfering with the businesses for using, operating and promoting their marketing of telephone time through video sweepstakes
The complaint also asks the court, after a full hearing, to declare the games are "not prohibited gambling, lottery or gaming products."
Burke County sheriff's officers and municipal police on March 12 pulled the plugs, literally, on machines that offer Internet sweepstakes and other games they say violate North Carolina's gambling laws. The lawmen ordered 56 businesses to get rid of their Internet sweepstakes machines and video gaming equipment by March 26.
The plaintiffs, who filed the request for an injunction on March 26, are Larry Walker doing business as The New Salem General Store; Chad Earp dba Tobacco Barn No. 1; A.J. Aykumar dba Brendle Town Grocery; Jerry's Neighborhood Store; By Pass Beverage; JT Group Inc.; Gregory Allen dba G.A. Amusements; Tamela Cook dba Pearson's Toy Trains; Jeff Whisnant dba Country Cousins; Quick Mart No. 1; Shop & Save No. 4; Archie Bradshaw dba Bradshaw Salvage & produce; and Linda Simmons doing business as Linda New Image.
Superior Court Judge Beverly Beal will hear the complaint in Courtroom No. 1 at the Burke County Courthouse. Court starts at 9 a.m., according to officials. Beal said he likely will hear the complaint during the morning session of Superior Court.
Beal noted that the town of Valdese also filed a motion to dismiss the complaint.
Beal said whatever happens with the hearing will likely result in a preliminary action.
However, the decision on the motion to dismiss could be a permanent one.
Valdese Town Attorney Marc Mitchell filed the town's motion April 9. He said the businesses' complaint wasn't served by the sheriff or other authorized person; wasn't served on the proper person to obtain jurisdiction over the town; and that the town police department is not an entity which can be sued in the action.
Valdese Police Chief John Suttle said he was served with the complaint by the sheriff's office on Thursday.
In addition to Valdese's police department, the businesses' complaint names district attorney Jay Gaither, Burke Sheriff John T. McDevitt and the Morganton and Drexel police departments.
Victor Yamouti of Morganton and Kelly Daughtry of Daughtry Woodard Lawrence & Starling in Smithfield are representing the businesses.
Steve Settlemyer, city attorney for Morganton, said to his knowledge the city had not been served with the complaint and he hasn't seen it.
County Attorney Redmond Dill said on Friday that he hasn't filed any motions regarding the case. He said there is already an injunction in Guilford County and he will let the court decide whatever it wants to decide.
In March, Superior Court Judge John O. Craig in Guilford County, responding to an appeal from Hest Technologies and International Internet Technologies, ordered McDevitt and other law enforcers in Burke County to "cease and desist from any efforts to seize equipment or property" belonging to the two companies. Craig's injunction also prevents local law enforcement officers from filing any criminal charges against anyone using the Hest and IIT software systems.
Amending an injunction he originally imposed in May 2009, Craig's revised order adds McDevitt's name to those of other N.C. law enforcement agencies. It also clarifies who has to comply with the original injunction; that is, any law enforcer, as well as any prosecutor, acting on behalf of the state
Published: April 18, 2010
MORGANTON - A Superior Court judge on Monday will hear a complaint filed against local law enforcement officers, the district attorney and the state of North Carolina.
Thirteen Burke County businesses want the court to issue a preliminary injunction that prohibits police, the sheriff's office and the DA from interfering with the businesses for using, operating and promoting their marketing of telephone time through video sweepstakes
The complaint also asks the court, after a full hearing, to declare the games are "not prohibited gambling, lottery or gaming products."
Burke County sheriff's officers and municipal police on March 12 pulled the plugs, literally, on machines that offer Internet sweepstakes and other games they say violate North Carolina's gambling laws. The lawmen ordered 56 businesses to get rid of their Internet sweepstakes machines and video gaming equipment by March 26.
The plaintiffs, who filed the request for an injunction on March 26, are Larry Walker doing business as The New Salem General Store; Chad Earp dba Tobacco Barn No. 1; A.J. Aykumar dba Brendle Town Grocery; Jerry's Neighborhood Store; By Pass Beverage; JT Group Inc.; Gregory Allen dba G.A. Amusements; Tamela Cook dba Pearson's Toy Trains; Jeff Whisnant dba Country Cousins; Quick Mart No. 1; Shop & Save No. 4; Archie Bradshaw dba Bradshaw Salvage & produce; and Linda Simmons doing business as Linda New Image.
Superior Court Judge Beverly Beal will hear the complaint in Courtroom No. 1 at the Burke County Courthouse. Court starts at 9 a.m., according to officials. Beal said he likely will hear the complaint during the morning session of Superior Court.
Beal noted that the town of Valdese also filed a motion to dismiss the complaint.
Beal said whatever happens with the hearing will likely result in a preliminary action.
However, the decision on the motion to dismiss could be a permanent one.
Valdese Town Attorney Marc Mitchell filed the town's motion April 9. He said the businesses' complaint wasn't served by the sheriff or other authorized person; wasn't served on the proper person to obtain jurisdiction over the town; and that the town police department is not an entity which can be sued in the action.
Valdese Police Chief John Suttle said he was served with the complaint by the sheriff's office on Thursday.
In addition to Valdese's police department, the businesses' complaint names district attorney Jay Gaither, Burke Sheriff John T. McDevitt and the Morganton and Drexel police departments.
Victor Yamouti of Morganton and Kelly Daughtry of Daughtry Woodard Lawrence & Starling in Smithfield are representing the businesses.
Steve Settlemyer, city attorney for Morganton, said to his knowledge the city had not been served with the complaint and he hasn't seen it.
County Attorney Redmond Dill said on Friday that he hasn't filed any motions regarding the case. He said there is already an injunction in Guilford County and he will let the court decide whatever it wants to decide.
In March, Superior Court Judge John O. Craig in Guilford County, responding to an appeal from Hest Technologies and International Internet Technologies, ordered McDevitt and other law enforcers in Burke County to "cease and desist from any efforts to seize equipment or property" belonging to the two companies. Craig's injunction also prevents local law enforcement officers from filing any criminal charges against anyone using the Hest and IIT software systems.
Amending an injunction he originally imposed in May 2009, Craig's revised order adds McDevitt's name to those of other N.C. law enforcement agencies. It also clarifies who has to comply with the original injunction; that is, any law enforcer, as well as any prosecutor, acting on behalf of the state
Wednesday, March 24, 2010
Grappling With The Rise In Sweepstakes Parlors
Maggie Martin (2010-03-23)
WILMINGTON, NC (whqr) - Sweepstakes parlors are springing up at a rapid pace around Wilmington and city council is concerned about the impact these places will have on local neighborhoods. They're holding a public hearing on a moratorium today.
City Councilman Ronald Sparks is worried, there's one there. There's a few machines I believe in one of those other places there."
"And that's just within a block of each other," I ask.
"Yes. Yes," Sparks says.
Driving down Carolina Beach Road in his dark blue SUV, Sparks points out the sweepstakes parlor's proximity to poor neighborhoods.
City records say there are 31 businesses with permits for sweepstakes machines and nearly 380 machines in Wilmington. Sparks is concerned those numbers could easily grow if rules aren't put in place soon.
"I just feel that we need to get a handling on these things before they proliferate everywhere."
Sweepstakes parlors first caught the attention of city council members back in December, when a North Carolina appeals court outlawed video poker but not the kind of internet gambling going on inside sweepstakes parlors.
The city wants to place a moratorium on any new parlors as a way to slow down a situation Sparks says is getting out of hand.
"It's just bring a clamant of gambling and Vegas as it were to Wilmington and I just see it as preying on poorer people cuz these things aren't being placed nearer affluent neighborhoods," says Sparks.
Jon Gen is setting up a customer to play. He takes a $20 bill from the man, puts it in the register and gives him a phone card with that amount. Swipe the card thru the internet gambling machine and an online version of a slot machine starts rolling.
Gen owns Triple Seven Sweepstakes off Market Street. He doesn't call this gambling, he calls it socializing.
"We consider this a meeting place, a form of entertainment. We're not dealing in that much money. And I think due to the fact that there are so many in town they should probably regulate."
Gen says on this night, it's exceptionally quiet. He says up to 70 players visit his parlor a day, instead of the handful sitting at his machines.
Dozens of machines that look like slot machines line the inside of the Triple Seven Sweepstakes. By 8 o'clock, a few players trickle in.
"It's kind of fun, enjoyable and relaxing," says Larry Jefferson Sr. He's a regular at Triple Seven, and also conflicted. On one hand, he encourages his friends to play. But on the other hand, he calls the sweepstakes parlors a trap for those desperate for cash.
"It's not good. Especially with the economy the way that it is, people just don't have the funds to initially involve themselves but they take the chance hoping there's a great outcome."
Jefferson supports Wilmington's call for a moratorium. Fellow sweepstakes player Chris Stevens disagrees.
"The moratorium bothers me and I think it's just restricting the freedoms of Americans. It's restricting your right to do what you please," Stevens says.
Including the right to win a few bucks.
"My biggest win has been about $180 I believe. And that was, believe it or not, on fifteen cents."
The debate over internet gambling isn't limited to Wilmington. Parlors are popping up across the state.
The North Carolina General Assembly is expected to tackle a bill banning it. Executive Vice President and General Counsel of the North Carolina Sheriffs' Association, Eddie Caldwell, says the matter could be resolved in the courts.
"The sheriff's believe, and all the legal advisors we've talked to believe that these sweepstakes machines are in violation of the current law. And so, if the court cases can be resolved and if the courts agree that the current law prohibits these machines, then there would be no additional regulation that would be needed."
And if the courts don't agree that sweepstakes parlors are covered by the video poker ban, then the fight could move to Raleigh where the internet gambling industry has reportedly hired lobbyists to fight any legislation banning sweepstakes parlors.
WILMINGTON, NC (whqr) - Sweepstakes parlors are springing up at a rapid pace around Wilmington and city council is concerned about the impact these places will have on local neighborhoods. They're holding a public hearing on a moratorium today.
City Councilman Ronald Sparks is worried, there's one there. There's a few machines I believe in one of those other places there."
"And that's just within a block of each other," I ask.
"Yes. Yes," Sparks says.
Driving down Carolina Beach Road in his dark blue SUV, Sparks points out the sweepstakes parlor's proximity to poor neighborhoods.
City records say there are 31 businesses with permits for sweepstakes machines and nearly 380 machines in Wilmington. Sparks is concerned those numbers could easily grow if rules aren't put in place soon.
"I just feel that we need to get a handling on these things before they proliferate everywhere."
Sweepstakes parlors first caught the attention of city council members back in December, when a North Carolina appeals court outlawed video poker but not the kind of internet gambling going on inside sweepstakes parlors.
The city wants to place a moratorium on any new parlors as a way to slow down a situation Sparks says is getting out of hand.
"It's just bring a clamant of gambling and Vegas as it were to Wilmington and I just see it as preying on poorer people cuz these things aren't being placed nearer affluent neighborhoods," says Sparks.
Jon Gen is setting up a customer to play. He takes a $20 bill from the man, puts it in the register and gives him a phone card with that amount. Swipe the card thru the internet gambling machine and an online version of a slot machine starts rolling.
Gen owns Triple Seven Sweepstakes off Market Street. He doesn't call this gambling, he calls it socializing.
"We consider this a meeting place, a form of entertainment. We're not dealing in that much money. And I think due to the fact that there are so many in town they should probably regulate."
Gen says on this night, it's exceptionally quiet. He says up to 70 players visit his parlor a day, instead of the handful sitting at his machines.
Dozens of machines that look like slot machines line the inside of the Triple Seven Sweepstakes. By 8 o'clock, a few players trickle in.
"It's kind of fun, enjoyable and relaxing," says Larry Jefferson Sr. He's a regular at Triple Seven, and also conflicted. On one hand, he encourages his friends to play. But on the other hand, he calls the sweepstakes parlors a trap for those desperate for cash.
"It's not good. Especially with the economy the way that it is, people just don't have the funds to initially involve themselves but they take the chance hoping there's a great outcome."
Jefferson supports Wilmington's call for a moratorium. Fellow sweepstakes player Chris Stevens disagrees.
"The moratorium bothers me and I think it's just restricting the freedoms of Americans. It's restricting your right to do what you please," Stevens says.
Including the right to win a few bucks.
"My biggest win has been about $180 I believe. And that was, believe it or not, on fifteen cents."
The debate over internet gambling isn't limited to Wilmington. Parlors are popping up across the state.
The North Carolina General Assembly is expected to tackle a bill banning it. Executive Vice President and General Counsel of the North Carolina Sheriffs' Association, Eddie Caldwell, says the matter could be resolved in the courts.
"The sheriff's believe, and all the legal advisors we've talked to believe that these sweepstakes machines are in violation of the current law. And so, if the court cases can be resolved and if the courts agree that the current law prohibits these machines, then there would be no additional regulation that would be needed."
And if the courts don't agree that sweepstakes parlors are covered by the video poker ban, then the fight could move to Raleigh where the internet gambling industry has reportedly hired lobbyists to fight any legislation banning sweepstakes parlors.
North Carolina Police Shut 56 Sweepstakes Gamerooms
3/24/2010 Marcus Webb
BURKE COUNTY, NC -- Police here shut down 56 Internet sweepstakes gamerooms in the towns of Morganton, Valdese, Drexel and Glen Alpine during the week of March 14-19. Sheriffs and deputies in several local jurisdictions within the county, working together, disabled more than 250 Internet terminals and videogames.
The operators -- some admitting to making cash payouts to winners -- were told they have until March 26 to dispose of the machines.
Various North Carolina district courts have ruled that sweepstakes games are legal under state law, assenting to the argument that a sweepstakes on an Internet terminal is -- in theory and in law -- no different from a similar promotion at fast food restaurants. In 2009, a Superior Court judge in Wake County, NC, prohibited raids on sweepstakes parlors until the pertinent law was clarified.
Nevertheless, numerous police and city councils find sweepstakes machines objectionable. Burke County Sheriff John McDevitt said police were "taking a leap of faith" and were willing to "interpret" the law for themselves. Slot machines, games of chance with cash payoffs, and video poker games (even if operated for amusement only) are illegal in North Carolina.
In a typical online sweepstakes gameroom, customers spend $1 to $5 to buy time on the networked computers or credits on videogames, or purchase sweepstakes tickets. They can then play slot-style games. Read more about North Carolina sweepstakes games.
But promoters of these contests sometimes argue that the a game's outcome is predetermined by the sweepstakes entry, and is not arrived in real time by the random operation of any poker, slot or blackjack software program that the customer happens to enjoy. This distinction means the game is a legal sweepstakes, not an illegal slot machine, operators say.
Following the Burke County raid, the sheriff of Catawba County, David Huffman, said that he would like to shut down Internet sweepstakes gamerooms there, too, and that he believes cash payoffs on the machines are illegal. But Huffman is refraining for now. Officials in other counties such as Shelby and New Hanover also want to shut down Internet sweepstakes game rooms but say they have not yet found a legal means to do so.
Rep. Ray Warren (D-Alexander and Catawba counties) has cosponsored a bill to ban online sweepstakes games. Warren said he didn't know when the bill could come up for committee markup or floor debate.
Earlier attempts to regulate the machines by lawmakers in Raleigh have failed due to the legal conundrum described above. Some lawmakers say they can't figure out how to outlaw sweepstakes games without also banning long-established McDonald's-style prize promotions.
BURKE COUNTY, NC -- Police here shut down 56 Internet sweepstakes gamerooms in the towns of Morganton, Valdese, Drexel and Glen Alpine during the week of March 14-19. Sheriffs and deputies in several local jurisdictions within the county, working together, disabled more than 250 Internet terminals and videogames.
The operators -- some admitting to making cash payouts to winners -- were told they have until March 26 to dispose of the machines.
Various North Carolina district courts have ruled that sweepstakes games are legal under state law, assenting to the argument that a sweepstakes on an Internet terminal is -- in theory and in law -- no different from a similar promotion at fast food restaurants. In 2009, a Superior Court judge in Wake County, NC, prohibited raids on sweepstakes parlors until the pertinent law was clarified.
Nevertheless, numerous police and city councils find sweepstakes machines objectionable. Burke County Sheriff John McDevitt said police were "taking a leap of faith" and were willing to "interpret" the law for themselves. Slot machines, games of chance with cash payoffs, and video poker games (even if operated for amusement only) are illegal in North Carolina.
In a typical online sweepstakes gameroom, customers spend $1 to $5 to buy time on the networked computers or credits on videogames, or purchase sweepstakes tickets. They can then play slot-style games. Read more about North Carolina sweepstakes games.
But promoters of these contests sometimes argue that the a game's outcome is predetermined by the sweepstakes entry, and is not arrived in real time by the random operation of any poker, slot or blackjack software program that the customer happens to enjoy. This distinction means the game is a legal sweepstakes, not an illegal slot machine, operators say.
Following the Burke County raid, the sheriff of Catawba County, David Huffman, said that he would like to shut down Internet sweepstakes gamerooms there, too, and that he believes cash payoffs on the machines are illegal. But Huffman is refraining for now. Officials in other counties such as Shelby and New Hanover also want to shut down Internet sweepstakes game rooms but say they have not yet found a legal means to do so.
Rep. Ray Warren (D-Alexander and Catawba counties) has cosponsored a bill to ban online sweepstakes games. Warren said he didn't know when the bill could come up for committee markup or floor debate.
Earlier attempts to regulate the machines by lawmakers in Raleigh have failed due to the legal conundrum described above. Some lawmakers say they can't figure out how to outlaw sweepstakes games without also banning long-established McDonald's-style prize promotions.
Sunday, January 31, 2010
North Carolina Phone Card Sweepstakes machines are here to stay
Authorities say ‘sweepstakes’ machines still fit in legal loopholeMacon County News: Thursday, 21 January 2010
By Davin Eldridge Contributing Writer
In February of 2009, gaming manufacturers took the state to court challenging the validity of banning video games statewide. Superior Court judge Howard E. Manning issued a controversial decision in that case, ruling that “the state acted unlawfully in authorizing the Eastern Band of Cherokee Indians to possess and operate video gaming machines on tribal lands,” while the rest of the state was not authorized to operate such machines.
Manning’s judgment rendered the ban null and void. But when this ruling went to the Court of Appeals recently, it was overturned. Yet law enforcement authorities have been halted by loopholes in the previous legislation, leaving the newer “sweepstakes” machines legal for the time being, and even paying out in cash.
In July of 2007, the state of North Carolina banned video gambling everywhere except for Cherokee lands, following the corruption charges of Buncombe County Sheriff Bobby Medford, who was found guilty in 2008 of receiving $300,000 in bribes from illegal gambling operators.
The bill banning video gambling, North Carolina General Statute 14-306.1A, was written after pressure from all 100 county sheriffs throughout the state pushed for legislation banning the business. The bill defines video gaming machines as “a video machine which requires deposit of any coin or token, or use of any credit card, debit card, or any other method that requires payment to activate play.”
Shortly after the ban, the video gaming industry reprogrammed their products as “sweepstakes machines.” Because the ban defines video gaming as any game resembling a video poker, bingo, craps, keno, or lotto game, game manufacturers absolved their machines from being defined as an outlet for gambling. Players of the game can now purchase predetermined winning or losing numbers, through phone cards.
In response to the loophole gaming manufacturers operate through, North Carolina General Statute 14-306.3 was written in December of 2008. Gaming manufacturers then promptly filed lawsuits challenging the constitutional fabric of the statute, claiming their products were no longer based on gambling.
“The video sweepstakes rooms and sweepstakes centers are not considered video poker and are a different class of game based on the state’s sweepstakes law,” said William Thevaos, president of the Entertainment Group of North Carolina.
On June 26 of 2009, Superior Court judge Paul C. Ridgeway ruled in favor of Sandhill Amusements Inc. out of Wake County, N.C. By demonstrating to the courts that the company could “suffer irreparable harm,” the judge entered a preliminary order of injunction. This order provided the industry with a “remedy at law,” and restrained state law enforcement agencies from taking any administrative action against video gaming companies.
Macon County Sheriff’s Office staff attorney Brian Welch explained Sandhill Amusements contended in the case that all counties throughout North Carolina are subdivisions of the state and must comply with the order. “I disagree with that opinion,” said Welch in a statement, “but the main problem for us is that state law enforcement agencies do have to comply with the order and they have the expertise, and expert witnesses, we would need to file charges that would result in convictions.”
The Ridgeway ruling has emboldened the industry, which will continue to operate. The case will be reexamined later this year.
“Law enforcement agencies across the state have written orders regarding the legality of the sweepstakes games and we believe that law enforcement agencies will uphold the judicial ruling,” Thevaos said. “Clearly, the different rules and regulations for what games can be played and can’t be played is a mess. That’s why we continue to advocate for state regulation and taxation of the video gaming industry in North Carolina,” stated Thevaos, who feels state oversight would create accountability and transparency within the gaming industry.
In the spirit of state oversight, the Sandhill Amusements order of injunction requires all retail establishments to clearly state the rules of the sweepstakes, and have no more than four machines on the premises of any retail outlet.
“A regulated and taxed video gaming industry in North Carolina could provide up to $500 million in new revenue for the state without raising any new states,” Thevaos said. “Let’s face it, the state is already in the gaming business with the N.C. Education Lottery – by regulating and taxing video gaming, the state can access another reliable stream of revenue without increasing sales or income taxes.”
Thevaos said the Entertainment Group of North Carolina will make another legislative push during the May 2010 session of the General Assembly for the state to regulate and tax video gaming.
“The State is looking at another major deficit. It’s an election year. Do you think the politicians want to raise more taxes? We believe the Legislature will take a serious look at a regulated and taxed video gaming industry to provide the revenue the state needs to fund education, mental health and public safety programs,” added Thevaos.
“As we move forward, the General Assembly and Governor need to look at what other states are doing when it comes to video gaming and the creation of another reliable revenue stream for the state. Illinois is implementing their video gaming law right now. They will have rigid state control, clear-cut rules, regulations and standards required for all video gaming distributors and operators. If you want to clean up video gaming, rid it of corruption and scandal, then you need to regulate it and tax – it’s just that simple,” said Thevaos.
The Illinois Video Gaming Act Thevaos refers to requires every gaming terminal be tested and approved by a state gaming board, and comply with federal regulations. Each gaming terminal in Illinois must also represent an accurate representation of the game, as well as record all money put into the machine, and money won from the machine. In May Thevaos will lobby for this kind of state oversight of video gaming.
Subscribe to:
Posts (Atom)