Pennsylvania Skill Games

I have gotten a number of questions recently related to the PA Skill games that are becoming more and more popular in bars, restaurants, and even convenience stores.  The questions I get are often concerning whether those games are legal and can lawfully be operated by a business owner, particularly if they hold a liquor license.

Recently, the Pennsylvania State Police and the Bureau of Liquor Control Enforcement conducted an investigation and seized a number of games in the Central Pennsylvania area.  In justifying these seizures, they took the position that these machines constitute illegal gambling devices and were subject to seizure by the police. That action by the police led to concerns by restaurateurs and other holders of liquor licenses that they were going to get in trouble or have these machines seized by the police.

After these raids and seizures by the state Police, Pace-O-Matic, one of the manufacturers of these Pennsylvania skill games, challenged the State Police and sought an injunction from the courts to prevent the police from seizing any more of the games they manufacture. They argued that their games do not constitute illegal gambling devices, and base their position on a decision issued in 2014 by a Court of Common Pleas judge in Beaver County. In that decision, the judge concluded that because there is an element of skill involved in the Pace-O-Matic games, they do not constitute illegal gambling. That decision in 2014 led to the wide spread circulation and use of these machines, but has also spurned a lot of copycat machines. Pace-O-Matic was initially granted an injunction by the Court of Common Pleas preventing the state police from seizing any of the machines they manufacture until the issue could further be sorted out in court system.

Earlier this week, the Commonwealth Court issued a decision and lifted that injunction, which now opens the door for the State Police and the Bureau of Liquor Control Enforcement to continue their investigations and potentially seize additional machines. Based on statements made by representatives of Pace-O-Matic and representatives of the State Police, it is clear that both sides have very different opinions about whether or not these devices are legal. Eventually, a higher court in Pennsylvania will have to decide whether these machines constitute illegal gambling, but in the interim, it has left many business owners and licensees in limbo as to whether or not they should have these machines in their establishments.

The PLCB has taken a clear position on the matter and issued a warning via email in June of 2019 to its licensees, indicating that they are following the State Police and their conclusion that these machines constitute illegal gambling devices. What that means is that licensees are potentially subject to citations, fines, and potentially even suspensions of their license, or objections by the Board when they renew their license if they are caught with these machines. I am not aware of any licensees that have been cited for the presence of these machines, but I suspect that if the state police and the Bureau of Liquor Control Enforcement wish to turn up the heat on this company, one way they could do so is by citing licensees for having these machines.

Under the current state of the law and the positions taken by the PLCB, the Bureau of Liquor Control Enforcement and the State Police, if licensees permit these games to appear in their premises, they are doing so at their own risk. You should carefully consider your options in determining whether they are worth keeping while this issue gets sorted out in the courts.

Aaron Zeamer is an attorney at Russell, Krafft & Gruber, LLP, in Lancaster, Pennsylvania. He practices in a variety of areas including Business Law and Liquor License matters. Aaron works frequently with commercial real estate agents, brokers, restaurant and bar owners, breweries, distilleries, and wineries to facilitate the sale and transfer of PA liquor licenses.