MADISON, Wisc.—A Wisconsin entrepreneur who invented a novel video gambling machine for gas station customers has received bad news from the state’s supreme court, according to JSonline.com.
Jeremy Hahn, founder of Quick Charge Kiosk, modified video gambling machines to enable cellphone recharging and placed them in gas stations and convenience stores around the state. Called Pow’r Up, the machines provided one minute of cellphone charging for $1 and provided users with credits to play a video game that gave them a chance to win more than $100. Reportedly, the machines paid out about 65% of the money customers spent on them.
The Wisconsin attorney general declared Pow’r Up to be illegal gambling machines and seized many of them. Hahn sued, arguing that using the machines was similar to winning a free soda in a pack of French fries with a random prize sticker attached. But his argument did not convince the court.
Justice Brian Hagedorn credited Hahn for his creative approach, but it didn’t fly. According to the court’s unanimous decision, the phone-charging equipment was akin to an “in-pack chance promotion,” which is an exception to the state law against illegal lotteries and permits promotions, such as the McDonald’s Monopoly game. While the court agreed that the kiosks are not lotteries, it ruled that the machines are more clearly addressed by the statute regarding gambling machines, which makes no exception for “in-pack chance promotions.”
There is clearly “consideration,” involved, Hagedorn notes, because a person pays a dollar for video game credits, then risks them playing the game for the chance to win a larger prize, basically, paying for the opportunity to obtain something of value, by chance.
“Free play option or not, Quick Charge’s argument does not overcome the reality that its kiosks can be used as gambling machines,” the judge concluded.