New gaming facilities
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Legality still under question but operators ‘sure they’re OK’
December 02, 2007 6:00 AM
BY F.A. KRIFT

The number of Ector County gaming facilities providing opportunities to play sweepstakes that simulate video slots has more than doubled in six months — and the owners say they believe they’re providing legal entertainment that doesn’t violate Texas’ gambling statutes despite allowing the players to win cash.

As law enforcement familiarizes itself with the new facilities and as county and district attorneys debate the enterprises’ legality, different companies are bringing in the game facilities under sweepstakes laws that allow companies to run charity promotions that award prizes similar to what McDonald’s does each year with its Monopoly game.

New facilities have opened up at 46th Street and Andrews Highway, on 61st Street, on University Boulevard and Grandview Avenue, and on West County Road among other locations.

“We were so busy and all of the sudden it died,” said Karen Watkins, who works at Vegas Lights on Andrews Highway, an established eight-liner game facility that legally cannot give out cash but awards more playing time to successful players. “I can’t believe how they just popped up.”

While it appears similar to the entertainment eight-liners provide, the owners and operators said it’s com-pletely different. They’re not eight-liners, which have countless times been proven to be illegal in Texas if used for gambling purposes. Sweepstakes machines provide an entertaining way to reveal the sweepstakes entry.

“It may look like a duck and walk like a duck, (but) nope, it’s just a fun way of doing things,” Leo Nathan, district manager for Texas E-Store, a sweepstakes com-pany, said.

Texas E-Stores provides the online charity sweepstakes fund-raising to the local Veterans of Foreign Wars.

A person can donate money to the VFW by entering a sweepstakes for various prizes, Billy Boone, attorney for Texas E Stores, said. Much like McDonald’s Monopoly game, no purchase is necessary for a free entry and all entries, if purchased through a donation to the VFW or not, have an equal chance of winning.

The sweepstakes entries assigns a number that is predetermined as a winner or not, Boone said. The online game merely simulates if the entry won or not through noise and graphics much like a video slot machine or even video poker. If the participant does win, they can walk out of the “donation station” gaming facility with cash.

The VFW sweepstakes complies with all state and federal sweepstakes laws, and the software has been certified by Nick Farley, an Ohio-based gaming expert, Boone said. The sweepstakes are no different than what the American Association of State Troopers Scholarship Foundation, the American Breast Cancer Foundation and U.S. Municipal Police Association conduct, Boone assured.

Boone wouldn’t disclose the percentage of the proceeds that are donated to the VFW, though Nathan said it’s about $3,000 to $5,000 a week.

At Reno Lights, another company that provides a sweepstakes game, owner Robert Babcock said he gives 5 percent of his proceeds to the Crisis Center, a local abuse counseling nonprofit organization.

Babcock’s Reno Lights provides Internet service, he said, and the people who use it can play for the sweepstakes prizes if they choose to.

They, too, are al-lowed limited free entry into the sweepstakes through a website called hello-money.com.

For now, the companies appear to be providing a legal service that isn’t gambling, Ector County Attorney Cathy Linch said. Because a person is allowed to enter the sweepstakes for free and the person with a free entry has an equal chance of winning as someone who donates, then it’s not gambling because the participant doesn’t have to pay to be considered for the prize.

“You don’t want to go after somebody if you’re not convinced it’s illegal,” Linch said.

County and district attorneys across the state have been receiving information packets from Texas E-Stores lawyers that contain sweepstakes expert’s opinion, a federal lawsuit that shows the sweepstakes legitimacy and other information sheets that explain the difference between eight-liners and sweepstakes run through computer software. Boone said the counties receiving the information packets are prospective locations for more Texas E-Store sweepstakes facilities associated with the VFW.

“We want to be a long-term player,” Boone said. “I think district attorneys and county attorneys would agree that they never had eight-liner people send them packets and expert reports like that before and send it ahead of time,” Boone said.

Andrews County Attorney John Pool received the packet about a month ago. He continues to investigate the new sweepstakes method, he said — and hasn’t come to a conclusion

“I’m a veteran,” he said. “We want (the VFW) to be successful, but it needs to be legal what they’re doing. As long as it’s legal, I don’t have a problem.”

The Odessa Police Department’s narcotics and vice department conducts about two sweeps a year of gaming facilities, Odessa police detective Cpl. Jesse Garcia said.

Along with Linch, Odessa detectives are trying to determine the legality of facilities despite what the gaming operators ensure is legal. No one has complained about the recent boom in gaming centers, he said.

While no criminal prosecution has been taken against the local facilities, Boone will pursue a civil lawsuit soon on Texas E-Store’s behalf, against competitors who’ve opened up using different software that’s not certified and what their experts believe is eight-liner style games operating under sweepstakes laws — which is deceptive and unfair competition, he said.

Regardless, owners maintain their businesses are legal, said Carolyn Hendrick, who enjoys the eight-liner style games and plays them for playbacks at Vegas Lights. She won’t use the sweepstakes facilities, fearing law enforcement raids reminiscent of the eight-liner facility busts the Texas Department of Public Safety started in the late 1990s.

Plus, she questions where the money goes and how much is actually for charity and how much is actually profit for the facility providers.

Hendrick experienced a raid while playing in an An-drews County store, and she doesn’t want to feel the fear again. They took her picture and kept her hours after the facility was shut down. She wasn’t charged with a crime, she said, but it was enough for Hendrick to hold out on the new style machines.

“Better safe than sorry,” she said.

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