RALEIGH, N.C. (AP) — North Carolina's highest court began grappling Wednesday with whether the state can label video sweepstakes parlors as gambling halls and outlaw the businesses multiplying statewide, or whether the video screens give the owners constitutional free-speech rights.
The state Supreme Court heard arguments in two cases in which amusement machine and other companies want to overturn a 2010 law banning video sweepstakes machines as a form of gambling. Sweepstakes halls have cropped up since the state in 2007 outlawed video poker machines.
Neither state law affects North Carolina's only casino, where the state's only federally recognized Indian tribe has offered video poker machines since the mid-1990s. The Cherokee casino recently expanded to hire card dealers for live gaming.
Lower courts have sided with the sweepstakes companies, citing a U.S. Supreme Court ruling last year that the content of video games can't be regulated any more than books or films under the Constitution's free-speech guarantee.
Sweepstakes parlor patrons buy Internet or phone time that gives them the opportunity to uncover potential cash and prizes with mouse clicks on a computer screen. Boosters contend there's no gambling because prizewinners are predetermined. Opponents say the enterprises feed the same gambling addictions as traditional video poker machines.
Company attorneys said just because lawmakers labeled video sweepstakes games an attempt to get around the public interest in limiting gambling, it doesn't mean that operators are sponsoring gambling. The sweepstakes are a tool to attract customers inside to buy Internet time on the provided computers, or to buy long-distance phone minutes, attorneys said.
"The reason our customers play these games is for their entertainment value," said Adam Charnes, an attorney for companies that build video sweepstakes machines or software. "That doesn't make it any less protected speech."
But all sweepstakes entice customers, or McDonald's wouldn't offer Monopoly board pieces to draw repeat customers away from other fast-food restaurants, said Kelly Daughtry, an attorney for Sandhill Amusements and other companies that sell long-distance telephone time.