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Monday, August 28, 2017

Gaming Board Rules Against "Video Gaming Mall"

The Illinois Gaming Board has authority over video gaming in Illinois, including determining the eligibility of a business to be issued a video gaming license. In Illinois, video gaming is allowed on a limited basis under rules established by the Video Gaming Act. Those rules generally limit the number of video gaming terminals in an establishment (5 maximum), and restrict the location of the gaming terminals within the establishment, among other rules. In addition, municipalities have authority to ban video gaming or to license establishments that offer video gaming. 

One of the fastest growing video gaming businesses are what is known as "video gaming cafes" - establishments whose primary focus is on video gaming, with secondary service of food and alcohol. These businesses rarely have a full kitchen operation, and as a result are fairly inexpensive to open. Recently, two of these businesses applied for video gaming licenses to operate in the same strip shopping mall in Hometown. The strip mall already had 3 other video gaming businesses. The shopping center's owner's plan, according to the court opinion, was to have 11 gaming establishments in the shopping center - in essence, to operate the shopping center as a video gaming mall.

The Gaming Board denied the 2 new license requests, finding that "having multiple video gaming establishments located within the same strip mall would be akin to having a mini-casino or back-door casino, but without any of the traditional safeguards" (such as security and having a Gaming Board agent on staff). In short, the Gaming Board determined that permitting a "video gaming mall" would not serve the best interests of Illinois residents.

The applicants for the 2 gaming licenses appealed the denial to the court, and the case made its way to the appellate court. The appellate court upheld the denial of the 2 licenses, finding that the Illinois Gaming Board has broad authority to deny a license, including "for any other just cause." In this case, the court found there was sufficient evidence presented to the Gaming Board about the adverse affects a video gaming mall would have on the public to justify the denial of these 2 licenses.

The court also mentioned a recent regulation adopted by the Gaming Board that authorizes the Board to deny a gaming license if approval of that license would create a situation where 2 or more licensed video gaming locations would be operated as a single video gaming operation (like a casino). 

Post Authored by Julie Tappendorf


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