Is a 'skill game' amusement machine illegal gambling in Texas if chance affects how much you can win, not just whether you win?

Plain-English summary

Three prosecutors in the Texas Panhandle (the Randall County Criminal District Attorney, the 47th District Attorney, and the Potter County Attorney) jointly asked the AG about a machine offered by Republic Amusements for a game called the "Lone Star Skill Game." The game runs in phases: a preview screen, a tic-tac-toe-style grid puzzle (the "Wild Card"), and a Simon-style memory game ("Follow Me"). Republic says the game is all skill and that a skilled player can always win back at least 105 percent of what they paid, but also that the symbols in the Wild Card phase appear "entirely by chance," and that the amount a player can win depends on those symbols. The prosecutors' precise legal question was whether the statute's element of chance applies only to whether a player wins anything, or also to how much the player wins.

The AG started by stressing what it would not decide. Whether a particular game is a gambling device depends on fact questions, and the AG's office cannot resolve facts in the opinion process, so it took no position on the legality of this specific machine. It also flagged skepticism: if a skilled player truly always nets 105 percent, the operator would lose money, so the AG doubted (and expected a court to doubt) the all-skill claim. But it accepted the facts as described for the limited purpose of construing the statute.

On the statute, Penal Code subsection 47.01(4) defines a "gambling device" as a contrivance that, for consideration, "affords the player an opportunity to obtain anything of value, the award of which is determined solely or partially by chance, even though accompanied by some skill." The AG parsed the phrase "the award of which is determined . . . by chance" and read "award" as the giving of any benefit. Because chapter 47 defines "thing of value" as "any" benefit, the chance element applies to the giving of any benefit, which includes both winning a prize and winning a larger prize. Nothing in the statute narrows "award" so that chance matters only to whether you win. The AG noted that an older Houston Court of Appeals case (State v. Gambling Device) did not resolve this exact issue but did stress that chapter 47 is meant to reach a broad range of gambling. Reading the chance element to cover the amount of the award best serves that purpose; the opposite reading would arguably make the statute meaningless, because every player who can operate a machine gets some nominal "benefit." The AG closed with a rubber-duck-raffle illustration: if it looks like a duck and quacks like a duck, it is a duck. The conclusion: it is unlikely a court would conclude that subsection 47.01(4) excludes an amusement machine where the amount awarded is partially determined by chance.

What this means for you

If you are a prosecutor or law enforcement officer

Based on this opinion, the chance element in subsection 47.01(4) reaches both whether a player wins and how much the player wins, so a machine cannot escape the gambling-device definition merely by claiming chance affects only the prize amount. The AG did not bless or condemn any specific machine; whether a given device is a gambling device remains a fact question for you and the courts.

If you operate or host amusement or "skill game" machines

The AG read the statute so that partial chance in the amount of a payout can make a machine a gambling device, even when skill also matters. The opinion does not declare the Lone Star Skill Game legal or illegal, but it signals that the "it's all skill" framing, and the narrower "chance only affects whether you win" argument, are unlikely to take a machine outside subsection 47.01(4). Penal Code section 47.06 criminalizes possessing a gambling device with intent to further gambling.

If you advise a business on machine placement

The decisive point is statutory: "award . . . determined solely or partially by chance" covers the giving of any benefit, including an increased prize. The AG also signaled skepticism toward the claim that a skilled player is guaranteed a net return, since an operator would not knowingly run a money-losing game. Treat the legality of any specific device as a fact-bound question, not settled by this opinion.

Common questions

Q: Did the AG say the Lone Star Skill Game is illegal?
A: No. The AG declined to decide the legality of the specific machine because that depends on fact questions the opinion process cannot resolve.

Q: Does it matter that chance only affects the amount won, not whether you win?
A: The AG concluded that distinction does not save a machine. The chance element applies to the giving of any benefit, which includes how much is won.

Q: What makes something a "gambling device" in Texas?
A: Under Penal Code subsection 47.01(4), it is a contrivance that, for consideration, gives a player a chance to obtain anything of value where the award is determined solely or partially by chance, even if skill is also involved.

Q: Is calling a machine a "skill game" enough to make it legal?
A: Not by itself. The AG read the statute to cover devices with any element of chance even when accompanied by skill, and was skeptical of the claim that the game is purely skill-based.

Background and statutory framework

Texas has long prohibited gambling (City of Fort Worth v. Rylie), and article III, section 47(a) of the Texas Constitution directs the Legislature to prohibit lotteries and gift enterprises, subject to exceptions. Penal Code chapter 47 prohibits various gambling activities (Adley v. State), and section 47.06(a) criminalizes knowingly possessing a gambling device with intent to further gambling. Subsection 47.01(4) defines a "gambling device" to include a contrivance that, for consideration, affords a player an opportunity to obtain anything of value "the award of which is determined solely or partially by chance, even though accompanied by some skill."

Whether a particular device is a gambling device is a fact question the AG does not resolve (compare Am. Amusement Co. v. Neb. Dep't of Revenue, where a court reviewed testimony on programming and reaction times). Construing the statute to effectuate legislative intent and give effect to every word (Broadway Nat'l Bank, Tr. of Mary Frances Evers Tr. v. Yates Energy Corp.; Lippincott v. Whisenhunt; Tex. Dep't of Crim. Just. v. Rangel), and avoiding a reading that renders any part meaningless (City of Dallas v. TCI W. End, Inc.), the AG read "award" as the giving of any benefit. Because "thing of value" means "any" benefit (section 47.01(9)), the chance element covers both winning and the amount won. An older case did not resolve the issue but emphasized chapter 47's broad purpose (State v. Gambling Device), and a construction that serves the statute's object is preferred (Citizens Bank of Bryan v. First State Bank, Hearne; Hebner v. Reddy). The AG therefore concluded it is unlikely a court would exclude such an amusement machine from subsection 47.01(4).

Citations and references

Statutes:

• Tex. Penal Code § 47.01 — defines "gambling device" and "thing of value"
• Tex. Penal Code § 47.06 — criminalizes possession of a gambling device
• Tex. Const. art. III, § 47 — directs the Legislature to prohibit lotteries and gift enterprises

Key cases:

• State v. Gambling Device, 859 S.W.2d 519 (Tex. App.—Houston [1st Dist.] 1993, writ denied) — chapter 47 reaches a broad range of gambling; any element of chance can suffice
• City of Fort Worth v. Rylie, 602 S.W.3d 459 (Tex. 2020) — Texas's long history of prohibiting gambling
• Hebner v. Reddy, 498 S.W.3d 37 (Tex. 2016) — a statute should be read to carry out, not defeat, its manifest object

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/ken-paxton/kp-0425
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/2023/kp-0425.pdf

Original opinion text

KEN PAXTON
ATTORNEY GENERAL OF TEXAS

February 6, 2023

The Honorable Robert Love
Randall County Criminal District Attorney
2309 Russell Long Boulevard, Suite 120
Canyon, Texas 79015

The Honorable Randall Sims
47th District Attorney
501 South Fillmore, Suite 5A
Amarillo, Texas 79101

The Honorable Scott Brumley
Potter County Attorney
500 South Fillmore, Room 301
Amarillo, Texas 79101

Opinion No. KP-0425

Re: Whether an amusement machine is a gambling device under section 47.01 of the Penal Code where the amount awarded from play is determined partially by chance (RQ-0457-KP)

Dear Mr. Love, Mr. Sims, & Mr. Brumley:

Collectively, you ask us to determine whether a particular amusement machine constitutes a gambling device under Penal Code subsection 47.01(4), where the amount awarded from play is partially determined by chance.¹

The Amusement Machine

You tell us Republic Amusements ("Republic") offers machines for the play of a game called the "Lone Star Skill Game" (the "Game"). Request Letter at 1. You recount Republic's description of the Game as a "currency or token-operated video game" offering three phases: a preview screen; a tic-tac-toe-style 3x3 grid puzzle (the "Wild Card"); and a Simon-style memory game called "Follow Me."² Id. According to Republic, the Game's first phase is a preview screen that allows the player to preview, prior to paying consideration to play, dozens of "next puzzles" to analyze which one may yield an award or a higher award. See id. at 2. The Wild Card second phase features a nine-space grid with each space containing a symbol related to a player-chosen theme. See id. The player has a limited time to change one of the symbols to a "wild" symbol in order to create a horizontal, vertical, or diagonal chain of three identical symbols. See id.

You explain that not all grids are capable of successful completion, and the second phase may result in less than 105 percent of the consideration paid to play the Game, even if played with perfect skill. See id. When that is the case, the Game directs the player to the Follow Me third phase where play "begins with a three-by-three grid of colored dots . . . [that] flash and make a sound in a random sequence that the player must repeat." Id. The player that matches 20 rounds, where each round adds another dot to the sequence, wins a "cumulative total of 105 [percent] of the original amount spent to play." Id. You state that Republic asserts all phases of the Game require player skill, and "always present the skillful player with the opportunity to win more than the cost to play the Game, every time, with a minimum return of 105 [percent]."³ Id. You note that Republic also asserts players can win significantly more depending on the symbols generated during the Wild Card phase and that the symbols display entirely by chance. See id. at 3. Lastly, you tell us that players are not required to proceed to the Follow Me phase but can instead display a new set of Wild Card puzzles upon new payment. See id.

A Gambling Device under the Penal Code

The State of Texas has long prohibited gambling. See City of Fort Worth v. Rylie, 602 S.W.3d 459, 460–61 (Tex. 2020) (discussing Texas's history of prohibiting gambling). Article III, subsection 47(a), Texas Constitution, requires the Legislature to "pass laws prohibiting lotteries and gift enterprises in this State," subject to certain exceptions. TEX. CONST. art. III, § 47(a). The Legislature prohibits a variety of gambling activities through Penal Code chapter 47. See TEX. PENAL CODE §§ 47.01–.11; see also Adley v. State, 718 S.W.2d 682, 683 (Tex. Crim. App. 1985) (stating that the Legislature criminalizes many of the "various forms of gambling").

In particular, Penal Code section 47.06 criminalizes the possession of a gambling device. See TEX. PENAL CODE § 47.06(a) ("A person commits an offense if, with the intent to further gambling, he knowingly owns, manufactures, transfers, or possesses any gambling device that he knows is designed for gambling purposes or any equipment that he knows is designed as a subassembly or essential part of a gambling device."). Chapter 47 defines "gambling device," in relevant part, to mean:

[A]ny electronic, electromechanical, or mechanical contrivance not excluded under Paragraph (B) that for a consideration affords the player an opportunity to obtain anything of value, the award of which is determined solely or partially by chance, even though accompanied by some skill, whether or not the prize is automatically paid by the contrivance.⁴

Id. § 47.01(4) (emphasis and footnote added).

You note Republic's contention that winning at all depends on skill with no element of chance, but you also note the amount that may be won is determined by a combination of skill and chance. See Request Letter at 4. For purposes of this opinion, we rely on your assessment of the facts. See infra notes 2 and 3. Whether a game is a gambling device depends on the determination of fact questions. See Tex. Att'y Gen. Op. No. JC-0449 (2002) at 6; cf. Am. Amusement Co. v. Neb. Dep't of Revenue, 807 N.W.2d 492, 502–04 (Neb. 2011) (reviewing testimony about computer programming and human reaction times to determine the element of chance in a video game). Accordingly, we do not opine about the legality of this particular Game. See Tex. Att'y Gen. Op. No. KP-0057 (2016) at 3 (acknowledging that "[i]n the attorney general opinion process, we cannot resolve factual issues"). Without deciding whether the Game you describe is otherwise illegal under chapter 47, we consider your narrow legal question—"whether chance applies only to winning [anything] or to both winning and the amount won." Request Letter at 4.

Construction of Penal Code Subsection 47.01(4)

A court's objective in construing a statute is to effectuate the Legislature's intent as found in the statute's text. Broadway Nat'l Bank, Tr. of Mary Frances Evers Tr. v. Yates Energy Corp., 631 S.W.3d 16, 23–24 (Tex. 2021), reh'g denied (Sept. 24, 2021). Courts further "presume the Legislature included each word in the statute for a purpose and that words not included were purposefully omitted." Id. at 24 (quoting Lippincott v. Whisenhunt, 462 S.W.3d 507, 509 (Tex. 2015) (per curiam)). Courts apply the definitions the statute supplies, but if a term is not defined, they typically "interpret the term according to its ordinary meaning[.]" Tex. Dep't of Crim. Just. v. Rangel, 595 S.W.3d 198, 208 (Tex. 2020). Additionally, a court will avoid adopting an interpretation of a statute that "renders any part of the statute meaningless." City of Dallas v. TCI W. End, Inc., 463 S.W.3d 53, 55 (Tex. 2015) (quoting Crosstex Energy Servs., L.P. v. Pro Plus, Inc., 430 S.W.3d 384, 390 (Tex. 2014)).

We consider subsection 47.01(4)'s language: "anything of value, the award of which is determined solely or partially by chance[.]" TEX. PENAL CODE § 47.01(4). In this context, the word "award" is the noun form of a verb that means to "give or order the giving of (something) as an official payment, compensation, or prize to (someone)." NEW OXFORD AMERICAN DICTIONARY 112 (3d ed. 2010). The word "the" is a definite article indicating that "the award" is limited by the remainder of the phrase, i.e., "of which is determined solely or partially by chance." MERRIAM WEBSTER'S COLLEGIATE DICTIONARY 1221 (10th ed. 1999) ("'The' is 'used as a function word before a noun to limit its application to that specified by a succeeding element in the sentence.'" (quoted in Graham v. Prochaska, 429 S.W.3d 650, 659 (Tex. App.—San Antonio 2013, pet. denied))). "Which" is a relative pronoun that "refer[s] to something previously mentioned when introducing a clause giving further information." NEW OXFORD AMERICAN DICTIONARY 1968 (3d ed. 2010). Here, "which" takes the place of the phrase "anything of value" that precedes the clause we consider. Thus, the clause "award of which" can be restated as the giving of anything of value.

Chapter 47 incorporates the breadth of "any" thing of value by defining the phrase "thing of value" to mean "any" benefit. See TEX. PENAL CODE § 47.01(9). When modified by the language "solely or partially by chance," the language means that chance applies to the giving of any benefit. See generally Tex. Att'y Gen. Op. No. KP-0057 (2016) at 5–6 (discussing chance and stating that "the argument that skill so predominates that chance is minimal is nonetheless an admission that chance is an element and partial chance is involved"). The giving of any benefit certainly includes the giving of an amount as a winning prize. But it also includes the giving of an increased amount as the prize. Further, no language in the definition of "gambling device" evinces any intent by the Legislature to parse the scope of "award" so narrowly that the element of chance applies to only the winning of an amount.

You and Republic both refer us to a 1993 Houston Court of Appeals opinion addressing a device under the definition in subsection 47.01(4). See Request Letter at 4–5; Republic's Brief at 4; see also State v. Gambling Device, 859 S.W.2d 519 (Tex. App.—Houston [1st Dist.] 1993, writ denied). The Gambling Device opinion contains language that, in isolation, could support either a construction in which chance applies to both the fact of winning and the amount won or a construction in which chance applies to only the fact of winning. It recognizes that the definition of gambling device applies to "contrivances that incorporate any element of chance, even if the exercise of skill also influences the outcome." Gambling Device, 859 S.W.2d at 523 (emphasis added). But it also states that "[a] contrivance that is designed to incorporate the element of chance to influence whether an award is provided to a player is a contrivance whose outcome is determined by chance." Id. (emphasis added). Yet the opinion does not consider the precise issue in your question and instead considers whether the statute was unconstitutionally vague by not specifying the amount of chance required to make a device a gambling device. See id. In concluding that any element of chance, even if accompanied by some skill, rendered a device a gambling device, the opinion does not delve into whether chance applied only to the act of giving of a prize and not to the determination of the amount of the prize.

While the Houston Court of Appeal's analysis in Gambling Device is not dispositive of your question, its reliance on the purpose of the statute is instructive. The Court recognized the purpose of chapter 47 is to "reach a broad range of gambling activities, and prohibit them." Id. at 524. As we previously observed, it has long been the policy of the State of Texas to prohibit gambling. See supra at 3. As demonstrated above, subsection 47.01(4) may reasonably be construed to apply the element of chance to all aspects of the award of a prize and that construction best serves the purpose of chapter 47. See Citizens Bank of Bryan v. First State Bank, Hearne, 580 S.W.2d 344, 348 (Tex. 1979) (stating that when "the language is susceptible of two constructions, one of which will carry out and the other defeat [its] manifest object, [the statute] should receive the former construction"); Hebner v. Reddy, 498 S.W.3d 37, 41 (Tex. 2016) (cited in ANTONIN SCALIA & BRYAN A. GARNER, READING LAW 63 (2012)). To construe subsection 47.01(4) otherwise, arguably renders it meaningless, a result courts avoid. See City of Dallas, 463 S.W.3d at 55; see supra at 5. Moreover, if we take Republic's argument that a device that renders "an" award based on skill is not a gambling device to its logical conclusion, it follows that no gambling device could exist in Texas because every player with any skill receives a nominal "benefit," such as the benefit of the joy watching a screen, playing a game, or receiving a prize.⁵

Conclusion

Accordingly, while we do not offer an opinion on the legality of this particular Game, it is unlikely a court would conclude that subsection 47.01(4) excludes an amusement machine where the amount awarded from play is partially determined by chance.

S U M M A R Y

Penal Code section 47.06 criminalizes possession of a gambling device. Subsection 47.01(4)'s definition of gambling device includes specified contrivances that afford a player an opportunity to obtain anything of value, the award of which is determined solely or partially by chance. It is unlikely a court would conclude that subsection 47.01(4) excludes an amusement machine where the amount awarded from play is partially determined by chance.

Because it involves the resolution of fact questions, we do not opine on whether a particular amusement machine constitutes a gambling device.

Very truly yours,

KEN PAXTON
Attorney General of Texas

BRENT E. WEBSTER
First Assistant Attorney General

LESLEY FRENCH
Chief of Staff

JOSH RENO
Deputy Attorney General for Criminal Justice

D. FORREST BRUMBAUGH
Deputy Attorney General for Legal Counsel

AUSTIN KINGHORN
Chair, Opinion Committee

CHARLOTTE M. HARPER
Assistant Attorney General, Opinion Committee

¹ See Letter from Honorable Robert Love, Randall Cnty. Crim. Dist. Att'y, Honorable Randall Sims, 47th Dist. Att'y, & Honorable Scott Brumley, Potter Cnty. Att'y, to Honorable Ken Paxton, Tex. Att'y Gen. at 1 (March 31, 2022), https://texasattorneygeneral.gov/sites/default/files/request-files/request/2022/RQ0457KP.pdf ("Request Letter").

² We received briefing from the Game manufacturer disagreeing with your description of the Game. See Letter from David Glicker, Glicker Law & Assoc., to Op. Comm., Off. of the Att'y Gen. at 1 (May 9, 2022) (hereinafter "Republic's Brief") (on file with the Op. Comm.). As this office relies on the "factual assertions of the one requesting our opinion," we rely on your description of the Game. Tex. Att'y Gen. Op. No. GA-0760 (2010) at 1, n.2.

³ If the assertion is true that the Game affords a "skilled" player a minimum return of 105 percent, it is also true that the entity offering the Game for play loses money on games played by "skilled" players. We are skeptical that an entity would offer play of the Game on a nonprofitable basis. Accordingly, we question the assertion that the Game is one solely based on skill and believe a court would also, but we accept it as true for the limited purpose of our legal analysis about the scope of Penal Code subsection 47.01(4).

⁴ Paragraph (B) contains an exclusion not relevant here. See Request Letter at 4 (stating that the "[g]ame is not excluded under Paragraph (B) because, among other reasons, it awards cash prizes").

⁵ Under Republic's argument, a rubber duck pull raffle would not be gambling, if an organizer for example places 1,000 rubber ducks floating in a body of water and sells 1,000 opportunities to player's who pay $10 per opportunity to pull a rubber duck from the water. Every player who has the "skill" to pull the rubber duck out of the water gets to keep the rubber duck, a "thing of value," but the one player that happens to pull the one rubber duck with a gold star on its bottom wins $1,000. In other words, if it looks like a duck, walks like a duck, and sounds like a duck, it is a duck.