Texas AG: Hybrid slot-skill machines are illegal

Texas Attorney General Ken Paxton issued a legal opinion concluding that hybrid slot-style machines that mix a chance-based spin with a post-loss memory “skill” round meet the state definition of an illegal gambling device when chance influences awards. The opinion was issued after a March request from State Sen. Bob Hall.

Paxton wrote that “so long as chance plays any role in determining whether the player obtains something of value, the device satisfies the statutory definition.” He added that “any award of value remains inextricably intertwined with the element of chance.”

The machines at issue start with a spin or other random outcome over which players have no control. Players who lose that initial spin may access a Follow Me-style memory game that can let them reclaim money lost on the spin. Paxton said the post-loss skill feature does not alter the original random outcome and therefore does not remove the device from Chapter 47 of the Texas Penal Code.

Hall, who sought the opinion, argued vendors promote the skill round to evade state gambling laws. He wrote that “a pig wearing lipstick remains a pig, and a gambling device dressed up to resemble a ‘skill’ device remains a gambling device.”

The opinion follows court rulings last year in which the Texas Sixth Court of Appeals and a lower court found Pace-O-Matic terminals, which use memorization rounds similar to the Follow Me feature, qualified as games of skill. Those decisions have produced a split among local prosecutors and law enforcement: some jurisdictions allow the machines to operate, while others have opened investigations or pursued legal challenges.

Paxton’s opinion is advisory. It does not change statutory law and does not overrule court decisions. Attorney general opinions are intended to guide enforcement agencies and lawmakers; courts may reach different conclusions in litigation.

The question of hybrid skill-chance terminals is one part of broader legal uncertainty over gambling in Texas. Other contested areas include privately run poker clubs that operate under a social-gambling exception and terminals known as eight-liners. State authorities earlier this year executed a raid at the Lodge Card Club near Austin, a large poker room operated by professional players.

Similar legal fights have occurred outside Texas. Missouri courts recently ruled against a company that marketed “no chance” machines, prompting the company to suspend operations in that state. Tennessee courts also ruled against similar terminals. Courts in Pennsylvania and Ontario have addressed comparable devices, and several cases remain on appeal.

Lawmakers, enforcement agencies and operators now face choices about whether to seek changes to state law, pursue further litigation, or remove these machines from the market while legal challenges continue.