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Birmingham 'sham' casino draws crowds, officials' ire
By Jay Reeves
Associated Press Writer
BIRMINGHAM — Sitting at a video machine that operates almost exactly like every slot machine she's ever played, Debra Dennis believes she's gambling in a casino, even if the owner and a judge say she isn't.
The cavernous room has garish carpet, smoky air and cocktail waitresses in short skirts. It's filled with 1,320 flashing machines with names like 'Cherry Pop' and 'Star Magic' that bing, bong and spit out recorded sounds of coins hitting a metal tray. To top it off, Dennis said she already has lost $275 in an hour.
'If it's not gambling they owe me $275,' said the woman from Lake, Miss.
Welcome to Quincy's MegaSweeps, a new 'video sweepstakes' venture that reopened this week after a judge ruled it was, in effect, nothing more than a fake casino with 'sham' gambling machines — all legal under a loophole in Alabama law.
The district attorney wants to shut down the operation and plans to appeal. But for now, gambling magnate Milton McGregor is free to run the venture inside his dog track, the Birmingham Race Course, which has struggled for years against competition from Mississippi casinos.
An analyst said the nation's gaming industry is keeping an eye on the operation to see how it fares both financially and legally as companies seek new footholds in states that prohibit true casino gambling.
'This is a new venture,' said the analyst, Brian McGill of the Susquehanna Financial Group near Philadelphia. '(A judge says) even though it looks like a slot machine and acts like a slot machine, it's not really a slot machine.'
McGregor opened Quincy's MegaSweeps in December, only to have it raided a few days later by Jefferson County sheriff's deputies. A court fight ensued, with Sheriff Mike Hale claiming the operation was an illegal gambling venture and McGregor contending it was legal.
Business ruled legal
After a hearing, Circuit Judge Scott Vowell sided with McGregor in an order that turned on the innards of the video machines and subtleties in Alabama law. The business reopened Thursday after a two-month hiatus and drew 1,500 people in a few hours without any advertising. )
McGregor said he and the Texas-based game manufacturer, Multimedia Games Inc., spent 'a ton' on the machines and creating an atmosphere 'that looks like something it's not.' People who believe they are gambling 'don't understand' the way the MegaSweeps works, he said in an interview Friday.
'It is complicated, but it complies with the law,' he said.
On a typical video slot machine, players put in money and hit a button, sending images of video wheels into motion on a screen. They win cash if objects like apples, stars and bars line up three in a row.
All that and more happens at McGregor's business.
Customers still plunk down cash at Quincy's MegaSweeps. For every $1, they get four minutes of computer time at an adjacent Internet cafe plus an electronic card with 100 credits that can be used to play the video machines.
Sweepstakes entry
McGregor says each credit is really an entry into a video sweepstakes, and players swipe their cards on the slot-like machines to see if their entries are winners. Losers watch their balance drop to zero; winners get to cash out at a casino-like cashier's cage.
McGregor argued in court, and the judge ruled, that the machines only reveal winning entries and aren't games of chance, despite their appearance. Vowell said the machines are 'a sham' designed to make customers believe they are gambling when, in fact, the outcome is determined as soon as they buy their credits.
McGregor's lawyers compared the whole operation to a soft-drink company hiding prizes under bottle caps to encourage people to buy more soda. Rather than selling pop, McGregor said he is selling Internet time and using the sweepstakes machines as the come-on. As proof, he said, people can enter the sweepstakes for free and check their winnings on home computers.
Law change to be sought?
In making his ruling, Vowell invited legislators to take a look at changing the law if they want to shutter such sweepstakes ventures. Gov. Bob Riley and Attorney General Troy King said last week they intended to ask lawmakers to do just that.
All the legal arguments and politics seemed lost on the hundreds of people who flooded into the faux casino during the first hours the video machines flickered back to life Thursday.
Puffing on a cigarette, Dennis laughed at the idea that anyone would come to the race track to use the Internet cafe that makes the whole venture legal. There was, after all, no one using the computer terminals as hundreds of people hovered around the fake slots.
'If it's not gambling, why have I been here for an hour with nothing to show for it?' she said.
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Another customer, retiree Peggy Hardin of Birmingham, joked with a couple of MegaSweeps employees over the idea that the slot-style machines aren't gambling. Then she went back to play some more, hoping to win back some of the money she'd lost.
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'It's gambling. Of course it's gambling,' she said.
Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.