The unregulated Pennsylvania skill games industry won a major legal victory Thursday, with the state’s Commonwealth Court ruling that seizure of the games in bars by law enforcement authorities was improper.

The court unanimously upheld a Dauphin County judge’s opinion that the devices are not illegal under current state law, as their element of skill rather than simply random chance negates the state attorney general’s contention that they are a form of prohibited slot machine.

Pace-O-Matic, the Georgia-based developer of the majority of skill games that have proliferated in bars, convenience stores, and other outlets around Pennsylvania, quickly embraced the ruling. The company had won county court cases defending its right to circulate what it brands as Pennsylvania Skill games, but this was the first key decision of its kind by a higher court with statewide authority.

“This is a major victory for Pennsylvania Skill, but it’s equally a victory for our operators and the thousands of small businesses, volunteer fire companies, and fraternal clubs who have come to depend on the revenue our games provide,” Paul Goldean, president and CEO of Pace-O-Matic, said in a statement issued by the company.

“This is also a win for many players across the commonwealth who enjoy skill games as a popular entertainment option,” he added. “Our games have always been legal, and this ruling proves that once and for all.”

While the attorney general still could potentially win the case by appeal to state Supreme Court, there’s also a good chance it leaves any crackdown on the machines up to the legislature by enactment of a new law. The Pennsylvania casino industry and Pennsylvania Lottery have vocally denounced the unregulated skill games as unfair and dangerous competition.

Lawmakers have held hearings on the topic in this and prior years, but they have lacked consensus on whether skill games should be banned outright or instead regulated and taxed.

They’re not gambling devices per se

Tens of thousands of the skill games — no precise count is known, compared to the 25,000 slot machines in 17 casinos — have materialized in recent years in various businesses and club outlets that share in the untaxed profits from them with distributors.

While money is inserted to play them and they bear resemblance to slot machines, the Commonwealth Court focused on a distinction in which players mastering a memory-related aspect of play can gain a consistent advantage.

The opinion written by Judge Lori A. Dumas stated “we discern no legal error in the trial court’s determination that the POM machines are primarily games of skill and, thus, not gambling devices per se.” It stated the machines do not constitute illegal contraband, and so devices that state police had seized from Champion Sports Bar had to be returned.

Such seizures have occurred occasionally around the state, but they have hardly been common due to the gray area of law in which the skill games have existed. Thursday’s ruling would seem to have a chilling effect on any future such enforcement actions.

“I think it’s a landmark decision in that it’s a decision of indisputable statewide application,” Matthew Haverstick, a Pace-O-Matic attorney, told PennLive. “These games are legal.”

When the Pennsylvania Senate committee responsible for gambling issues held hearings in October, it heard both from casino officials urging legislation to shut down the games as an unregulated menace and from Pace-O-Matic and representatives of bars and clubs who said they offer valuable income to establishments that might otherwise die.

The current two-year legislative session continues into 2024, and while opposing bills have been introduced to regulate and ban skill games, it remains to be seen if either type of proposal will gain traction with lawmakers for the first time. In the meantime, the games will continue being available with no oversight.

Photo: Gary Rotstein