NC Appeals Court catches Ocean Fish King in illegal sweepstakes net

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  • A unanimous N.C. Court of Appeals panel has ruled a video game called Ocean Fish King falls under the state's ban against video sweepstakes.
  • The ruling upholds a trial judge's decision favoring police in Hickory and Conover. Both cities tried to shut down operations of the controversial game.
  • The decision arrives one week after the Appeals Court denied Gov. Roy Cooper's request for a stay in a separate video sweepstakes dispute in Forsyth County.

The NC Appeals Court has ruled that a video game called Ocean Fish King is an illegal sweepstakes. The unanimous appellate decision Tuesday affirms a trial judge’s ruling against sweepstakes operators in Hickory and Conover.

“Section 14-306.4 of our General Statutes outlaws the operation of electronic sweepstakes machines and similar games of chance. We are tasked in this appeal with determining whether the controversial game Ocean Fish King has been caught up in the broad net of our state’s sweepstakes prohibition,” wrote Judge April Wood.

In 2018 police departments in the two cities decided to enforce state slot machine and video sweepstakes prohibitions against Fun Arcade and Barracuda Adventures, two companies that operate multiple businesses with gaming machines.

The two companies filed suit against Hickory, Conover, and their police chiefs. Plaintiffs argued in the case of Ocean Fish King that skill predominates over chance in the game’s outcome.

Wood’s opinion noted that the plaintiffs and the police put forward experts who offered contrasting assessments of the game. The defense’s expert found “no specific strategy or advantage that a player could learn to receive a better outcome in the game.” The plaintiffs’ expert countered that “players could develop a skill to memorize the game’s patterns over time. He reasoned that a novice player could improve with experience in terms of accuracy, selection of optimal targets, and in terms of overall score if the player repeatedly played the game.” The plaintiffs’ expert argued that “success in the game was determined by the player’s dexterity.”

A trial judge ruled against the businesses and in favor of the police departments in March 2022.

“Defendants’ expert testified in his affidavit that he believed Ocean Fish King operates predominantly as a game of chance, in which a game’s outcome is predetermined from a formula programed into the game,” Wood wrote. “Conversely, Plaintiffs’ expert testified that the game is one of skill and highlighted the hand-eye coordination, weapon selection, visual recognition, and other considerations necessary to succeed at the game.”

“Plaintiffs, however, do not disagree with Defendants as to how the game is played,” the Appeals Court opinion continued. “Both acknowledge, for example, that players must use controllers to aim weapons at a screen full of fish, shoot the fish with these weapons, and receive points as a result of destroying the fish.”

“Thus, though the experts disagree as to whether the game is predominantly one of skill or chance, the trial court did not err in its determination when there is no dispute as to how the game actually is played,” Wood wrote.

“Plaintiffs next argue that the trial court otherwise erred in determining that chance predominates over skill with Ocean Fish King, claiming that the trial court improperly applied the predominant-factor test. To the contrary, the court properly considered the uncontested means of play when it determined that Ocean Fish King is predominantly a game of chance.,” the Appeals Court opinion added.

Wood relied on the state Supreme Court’s 2022 ruling in a case called Gift Surplus. “There, our Supreme Court held a game resembling a slot machine, but which featured ‘double-nudging’ and always paid out some winnings, violated the electronic sweepstakes prohibition,” she wrote. “Players could only slightly influence the game’s outcome. It concluded, even if a player were to become more skilled, ‘chance would always predominate because, when chance determines the relative winnings for which a player is able to play, chance “can override or thwart the exercise of skill.”’”

“In the present case, Ocean Fish King players use digital weapons, controlled with a joystick, to shoot projectiles at sea creatures as they appear on the display screen,” Wood explained. “The screen is crowded with fish. Each fish requires a set amount of hits to destroy. The player does not know how many hits are required to destroy a given fish, and similar-looking fish do not necessarily require the same number of hits every game.”

“Applying the predominant-factor test here, we likewise hold that Ocean Fish King is predominantly a game of chance,” she concluded. “Though players must have some measure of dexterity to use the joystick, a player cannot know beforehand how many hits are necessary to destroy fish and, thus, cannot strategically optimize a favorable return on credits. Since a player wins credits proportional to the number and type of fish destroyed, this game is predominantly one of chance.”

Judges John Arrowood and Allegra Collins joined Wood’s opinion.

The Fun Arcade ruling arrived one week after the Appeals Court denied Gov. Roy Cooper’s request to block a trial court ruling in a separate sweepstakes case from Forsyth County. In that case, BST USA v. State of North Carolina, business owners also argue that their games rely more on skill than chance.

A Superior Court judge agreed with the businesses and blocked law enforcement agencies from shutting the machines down.