Give Me My Money Back: Court Says Suit Over Slot-Like Machine Losses Can Continue

The historical horse racing machines were deemed illegal by the Kentucky Supreme Court last year, and now people want their money back.
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Gamblers can proceed with suing two racetracks in the state of Kentucky over their losses from historical horse racing machines that the state’s high court in 2020 deemed were illegal because they didn’t constitute parimutuel wagering.

According to Kentucky.com, Fayette Circuit Court Judge Thomas Travis last week ruled that the lawsuit, filed in February, can proceed. Attorneys for the industry sought to have the suit dismissed, arguing they had been approved by a state commission previously. The machines had existed in a gray area for years, and lawmakers this year enacted a legislative remedy to allow the lucrative slot-like machines to continue. The case could become a class action and head to a trial.

The legal saga is similar to Kentucky’s long-running efforts to recover hundreds of millions of dollars from PokerStars on behalf of state residents who spent money on the site prior to 2011. PokerStars is still fighting the judgment.

Case could involve thousands of players

The ruling from Judge Travis last week on the machines potentially involves anyone who had gambled on the machines, operated by KRM Wagering, within the last five years. A gambler loyalty program is able to track customer losses, per the lawsuit.

Punitive damages could also be awarded.

“The judge declined to dismiss the case at this time,” Steven Loy, attorney for the KRM Wagering, told the Lexington Herald-Leader. “He’s set up a [July] status conference, we will of course attend the status conference and we’ll know more at that time.”

The historical horse racing machines, which debuted in the state over a decade ago, populate six gambling locations in the state. There are more than 4,200 throughout Kentucky, and each machine averages approximately $4,000 each day in handle, according to the state.

Kentucky doesn’t have any casinos, but the tracks have been seeking legislative approval to open sportsbooks, as well as offer sports betting over the internet. The powerful Family Trust Foundation, a conservative activist group, has apparently been successful blocking sports betting, despite Kentucky’s neighbors having the activity. The foundation was behind the lawsuit that led to the racing machines being declared illegal.

The Bluegrass State is expected to debate sports betting once again in 2022.

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