Posted on: August 24, 2022, 10:24 am.
Last updated on: August 24, 2022, 10:26 a.m.
Virginia skill gaming manufacturer and distributor Queen of Virginia is under attack for bringing nearly 150 lawsuits against small business owners, the majority of which run convenience stores in the commonwealth.
A Queen of Virginia skill gaming player plays a machine in a 7-Eleven convenience store in Charlottesville, Va. The Virginia skill gaming company behind the company has sued numerous businesses for contract violations. (Image: The Daily Progress)
Queen of Virginia is the company behind the slot-like machines that have proliferated across Virginia over the past several years. The firm’s skill games come in four varieties ranging from bar top apparatuses to standalone cabinets.
The devices have been highly controversial in Virginia. Some say the terminals are nothing more than cleverly designed slot machines. Queen of Virginia, a subsidiary of Pace-O-Matic, a Georgia-based gaming manufacturer, says its products do not constitute gambling, as elements of skill more heavily determine a play’s outcome.
Skill Gaming Legality
Virginia lawmakers temporarily legalized skill gaming machines amid the pandemic to help small business owners offset some of their revenue losses. But the temporary authorization of the games expired on June 30, 2021.
However, Greensville County Judge Louis Lerner has since issued injunctions preventing law enforcement from going after the unregulated machines. Lerner’s most recent ruling allows skill gaming machines to continue operating in the state through November 2, 2022.
Only skill games that were permitted under the state’s temporary legal authorization are permissible under the Lerner injunction. But many convenience store owners have opted to do away with their Queen of Virginia gaming machines amid the legal controversy.
An investigation conducted by staffers at the Virginia Mercury discovered that Queen of Virginia has filed nearly 150 lawsuits, all nearly identical, against vendors who chose to power down the skill games.
Like most companies, we vigorously defend our contractual terms,” Michael Barley, a Pace-O-Matic spokesperson, told the Virginia Mercury.
The Queen of Virginia lawsuits allege that the defendants owe Pace-O-Matic financial damages for not running the devices as stipulated under the agreed-upon contracts. The skill gaming company’s terms include the requirement that the brick-and-mortar business allows only Pace-O-Matic machines on its premises.
Stores that agreed to place Queen of Virginia machines inside their establishments signed five-year contracts with Pace-O-Matic. Once the initial term is up, the contracts still bar businesses from installing non-Queen of Virginia games for another year.
Businesses must tell Pace-O-Matic in writing that they’re ending their contract within 180 days of the five-year contract’s expiration or the contract will renew for another five-year term.
Skill Gaming Front
Pace-O-Matic is dominating the skill gaming industry in the two leading states where the controversial machines have popped up in bars and restaurants, gas stations, and grocery stores. Along with Virginia, the company’s Pennsylvania Skill machines are the leading skill gaming title in Pennsylvania.
The gaming and lottery industries say skill gaming machines illegally tap into their highly regulated businesses. While casino slots and historical horse racing (HHR) machines are routinely audited for fair play and provide a substantial tax benefit in Pennsylvania and Virginia, skill gaming machines provide no gaming tax revenue to local or state government and are not required to inform players of the device’s payout rate or associated odds.
Pace-O-Matic says its machines have been a lifeline for many small businesses. Revenue from each machine is shared between the host establishment, route operator, and Pace-O-Matic.
