Pennsylvania casinos last week asked a judge for an injunction to halt online games being offered by the Pennsylvania Lottery that they consider illegal competition.
The injunction was requested in a lawsuit filed by the state’s 13 land-based casino licensees in May 2018, claiming that games being offered by the Pennsylvania iLottery are identical to slot and video poker games on the floors of their casinos, to which they were granted exclusivity under the original gaming law—and which they plan to introduce as online games on their own iGaming sites within a few weeks.
The massive gaming expansion law passed in 2017 legalized online gaming, but also authorized the state lottery to being offering online games, as a way to keep up with new competition for the gaming dollar from new casinos, mini-casinos, sports betting and other new forms of gaming.
The casinos, in their lawsuit, argue that the gaming expansion law contains language requiring that iLottery games be different than casino games, but the iLottery features slot games with identical titles as the land-based games, as well as video poker and other casino-style games. The lawsuit was filed immediately after the iLottery games went live in May 2018.
The casinos are seeking an injunction now because the Pennsylvania Gaming Control Board has given the go-ahead for land-based licensees to launch their iGaming websites in the next few weeks.
Among the points noted by the casinos:
- At least nine iLottery games have the same titles and/or themes as slot machines offered on Pennsylvania casino floors or online casinos in other states.
- iLottery games have an average payout of 85 percent, which is the minimum payout percentage for Pennsylvania’s slot machines, whereas the minimum payout percentage for traditional lottery games is 40 percent.
- Some of the games are offered in nickel or dime denominations that are typical for casinos but not any other lottery products.
- The state Department of Revenue, which oversees the lottery, required that its game supplier agree not to sell the same games to Pennsylvania casinos, effectively admitting iLottery games are, in fact, casino games that would otherwise be sold to and offered by casino operators.
- At least 22 of the iLottery games are certified for compliance with casino gaming standards in other jurisdictions.
“Pennsylvania casinos are not opposed to iLottery—only simulated, casino-style games,” said David La Torre, a spokesman for the casinos in the case, in an interview with the Penn Live website. “In fact, casinos are supportive of the lottery’s mission and provide space for lottery ticket vending machines on their casino floors. Some have become the best-selling outlets of lottery tickets in Pennsylvania.”
