Gambling With a Lawsuit over Slot Machines
- posted by Jim Leitzel @ 5:26 PM

Vice Squad recently (on May 9 and May 15) has been talking about the reinforcing qualities of slot machines, the ways in which today's computer-chip driven slots are engineered to induce players to spin the reels one more time. Some players (presumably not those who have actually won money) are not amused by these reinforcing qualities, and have been pursuing a class-action lawsuit for the last decade. The lawsuit charges "that casinos, slots manufacturers and cruise ship operators - virtually the entire gambling industry - have fleeced machine patrons with a knockout cocktail of computer technology, crafty marketing and outright deception.

The case is pending in the U.S. 9th Circuit Court of Appeals in San Francisco."

According to the linked article, the plaintiffs charge that the casino industry disguises the odds on slot machines and video poker terminals; the fiction of a near-miss is also part of the complaint. David Boies, Al Gore's Florida recount advocate, is the lawyer for the plaintiffs. (Boies's son is currently involved in a lawsuit against alcohol manufacturers claiming purposeful marketing to underage drinkers.) One of the plaintiffs hit upon the idea of suing, apparently, following twelve straight losing hands at a video poker terminal in 1990.

Gambling is far from a "perfectly competitive" industry, and we seem to want it that way, out of concerns with problem gamblers and the exposure of kids to wagering. As a result, there is no reason to believe that the disclosure of information is "optimal." I don't really object, then, to a requirement that each slot machine indicate the payout rate. (I realize that such rates vary based on the type of wagers made and whether there is some sort of cumulating jackpot, but a minimum payout rate based on a one-unit bet could still be determined.)

Labels: casino, gambling, robustness, slot machine