Lawsuit against Video Gambling Terminals Gets Green Light in Canada to Proceed

Lawsuit against Video Gambling Terminals Gets Green Light in Canada to Proceed

An interesting lawsuit that pits government-owned video lottery terminals and social welfare advocates has been given the go-ahead by the Newfoundland and Labrador Court of Appeal. The class-action lawsuit pits the Atlantic Lottery Corporation, which services all four Atlantic Provinces, and hundreds of problem gamblers or their family members who have been affected by gambling addiction. Many experts believe that the outcome of this case will have a direct effect on VLT revenue in other provinces as well.

Gambling in Canada

Gambling in CanadaGambling in Canada operates under two levels of Canadian law. First, there is the federal law, which primarily governs criminals and how provinces manage their gambling. Each province however has the power to make its own laws and regulate its own gambling. This leads to different provinces having different forms of gambling and different laws regarding gambling.

Most provinces have casinos, with the exception of Newfoundland, Labrador, and Prince Edward Island. All of the provinces have video lottery terminals. Horseracing is also found in some provinces in Canada. Lotteries and sports betting as well as online gambling are available in Canada as well. In Canada, sports’ betting is not betting on a single sport. Instead, sports’ betting is done as a parlay bet. This means that wagerers must bet on several games at one time in order to bet.

The Lawsuit

The lawsuit began with two men, Douglas Babstock and Fred Small with one lawyer. Their argument has been that VLT’s are deceptive. According to the original lawsuit filed in 2012, the VLT’s use electronic programming to trick players into thinking they won. In fact, the lawsuit argues, the players are deceived into betting more money when they are losing at the machines. Originally, the men sued the company by themselves, but the lawsuit was granted class-action status in 2017. The class-action suit now says that all 30,000 people who live in Newfoundland and Labrador who put money into VLT’s from 2006 forward.

The Continuing Litigation

The litigation is seeking damages based on the amount of money taken in by the Atlantic Lottery Corporation, which is in charge of gambling in the four Atlantic Provinces. The gambling company has said that the electronic games depend on random number generators to determine the number of winners and how often winners are paid out.

The lawsuit also seeks to get an injunction that would bar the company from using VLT’s as part of its gambling profile.

litigationThe lawsuit is moving forward based on the lawyer’s assertion that VLT’s are not a permitted gambling device under the federal law. However, the appeals court did throw out two parts of the class action appear. First, the court said that VLT’s do not violate the federal competition act. The competition act is a rule that guarantees free and fair competition between companies in the same type of business. Second, the court rejected the noted that the Statute of Anne applied in this case. The Statute of Anne stated that it was the responsibility of the state to prevent deceitful gambling.

VLT companies, as well as lottery companies across the state are watching the decision carefully. If the plaintiffs win the case, it will immediately affect VLTs in Labrador and Newfoundland. Nevertheless, the case may also affect other VLTs across the country, which has gambling companies and lottery companies across the country concerned. VLT’s bring in hundreds of millions of dollars in revenue to the Canadian government, and a court case could take all of that revenue away from towns, cities, and provinces. This could directly affect the agencies and infrastructure that benefit from gambling revenue.

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