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NC video poker machine ban judged by appeals court

RALEIGH, N.C. – Appeals court judges hearing arguments Oct. 14 on the legality of North Carolina’s video poker ban sounded wary of negating the will of the General Assembly when it granted an exception to machines on the Cherokee Indian reservation.

Two of the three judges on the panel of the state Court of Appeals, which considered a Wake County judge’s ruling earlier this year that overturned the 2006 law, peppered an attorney for an amusement machine vendor with questions about why it should step into a legislative policy question.

Video poker machines could be permitted again in all 100 counties should the lower court keep the ruling in place.

“I always thought that the Legislature set public policy,” Judge Robert Hunter of Marion asked Hugh Stevens, representing vendor McCracken and Amick Inc., which sued over the ban. “You seem to argue that this is somehow contrary to the public policy of the state.”

Stevens said in this case, the 2006 law runs counter to the Indian Gaming Regulatory Act that required then-Gov. Jim Hunt to negotiate a gambling deal with the Eastern Band of Cherokee Indians.

“Saying that you can’t have any anywhere else in the state while you allow them for the tribe is not a comprehensive public policy. It’s something different,” Stevens said.

Mark Davis, a special deputy attorney general, argued the Legislature had the authority to grant exclusive video gambling rights to the Cherokee tribe.

Court of Appeals Judge Martha Anne Geer also asked Stevens to explain why the 2006 law was not a “profound statement” by the Legislature that should be left alone.

Much of the nearly 90 minutes of arguments centered on the wording of the federal Indian gambling act and the intent of Congress when it approved the law in 1988. It could be months before the panel rules in the case, which ultimately could wind up before the state Supreme Court.

Davis said North Carolina followed the federal Indian gaming law by creating a way for Cherokees to improve their economy and giving citizens a say in how the tribe could conduct those games, Davis said.

The Cherokees operate a casino on their reservation that employs 1,800 people and provides thousands of dollars a year to each tribal member.

“It’s given tribes favorable gaming rights so they can have strong tribal economies and maintain self-sufficiency,” Davis said. The vendor’s “interpretation is consistent with neither,” he added.

Wake Superior Court Judge Howard Manning ruled in February the video poker ban violated the federal law by prohibiting video poker machines in much of the state while allowing the Eastern Band to operate the same games.

Manning issued a stay on his order, but the ruling has added confusion in the courts. The Eastern Band could continue to operate its casino whatever the outcome.

Associations with the video poker industry sent one western North Carolina sheriff to federal prison and led to an investigation of former House Speaker Jim Black, who ultimately received prison time in a corruption-related plea unrelated to video poker.

Other amusement machine owners who used to set up the machines in convenience stores and bars are watching the case in hopes of reviving the industry. They floated a bill this year that would give the state a 20 percent cut in the machine profits in exchange for regulation they said would clean up the industry.

“We believe it is unconstitutional to grant the Cherokee nation video gaming rights and not grant the same rights to all citizens in all 100 counties,” the Entertainment Group of North Carolina said in a news release.

A couple dozen sheriffs filled a small courtroom to hear the arguments. They sought the 2006 law after struggling for years to keep track of legal machines and hearing complaints of large illegal cash jackpots.

“We just want to get this settled for sheriffs once and for all that it’s illegal in the state of North Carolina to have these machines,” Cumberland County Sheriff Earl “Moose” Butler said.

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