Lawsuit Challenges Crackdown on Slot Machines in Missouri

Since February, Missouri attorney general Catherine Hanaway has shown no hesitation to shut down what have been labeled illegal video slot machines in Missouri. But an advocacy group in the state thinks she’s overstepped her authority, and it’s filed a lawsuit in response.

The Missouri Licensing Advocacy Group (MOLAG) filed a lawsuit in Cole County, Missouri, representing retailers and liquor license holders in the state. The lawsuit alleges that Hanaway’s office has threatened business’ operating licenses, which MOLAG says exceeds her authority.

Essentially, the MOLAG lawsuit contends that Hanaway’s office has been far too broad with deciding what counts as an illegal game. In February, a federal judge ruled that slot machines in Missouri were illegal outside of casinos. Hanaway’s office responded by ordering the removal of gaming devices in the state.

But MOLAG contends that these “no-chance” machines are similar to claw machines or video games, where the player pays with the possibility but without the expectation of a win. These machines display the results before the player chooses to play, which operators have argued makes them different. Up until February, they were a common fixture in Missouri.

What Is the Lawsuit Asking Regarding Slot Machines in Missouri?

The lawsuit wants the machines left alone until the Missouri legislature can re-address the question. That nearly happened earlier this year, as the Missouri House passed a bill that would have legalized video lottery machines in the state. It further would have imposed a 3% tax on the machines, granting increased revenue to Missouri.

However, that bill died in the state Senate. Missouri’s legislative session ended in May, and the legislature will only meet one more time before the year’s end. That session is the state’s veto session, so only bills that Gov. Mike Kehoe sends back will be reviewed.

Essentially, this lawsuit would pause Hanaway’s office from taking action until January. That’s when the new legislative session begins in Missouri.

Why Have Slot Machines in Missouri Come Under Fire?

The landscape in the Show Me State has changed in recent years. In 2023, Torch Electronics, one of the companies making the games, filed a lawsuit against the Missouri Highway Patrol, seeking to stop them from seizing machines. Then-attorney general Andrew Bailey initially defending the state highway patrol. However, after Torch contributed to his campaign, Bailey ceased his defense.

Hanaway has taken a much firmer stance against the machines and their operators. Her office has focused on several bars and businesses, attempting to get the machines removed. That brought a lawsuit from Tuners Bar and Grill, even though it isn’t under investigation.

What’s Likely to Happen Next?

The key to watch for is whether an injunction is granted. If the courts grant an injunction, that says that MOLAG has a strong chance of winning the case. In order to get an injunction and keep video Missouri slot machines in place, MOLAG must show it’s likely to win on merits. It must also prove that allowing the crackdown will cause harm to businesses.

Given the difficulty in showing harm in this case, a lack of injunction wouldn’t necessarily mean the case goes Missouri’s way. If an injunction is granted, Hanaway’s office would have to leave gaming machines in place.