Canadian Video Lottery Terminal Fate Rests on Unique Lawsuit

Video lottery terminals, better known as VLTs, are common throughout Canada, whether in restaurants, bars, or liquor stores. However, not everyone is happy with their presence in the country. In fact, approximately 30,000 people in Newfoundland and Labrador have now been given the green light to file a class action lawsuit against state-owned VLT operator Atlantic Lottery Corp.

The lottery-style number games are random. The prize pool, however, is fixed and connected to the lottery company’s central system. The company subsequently collects its share of revenue while paying out a percentage to winning players.

Many of those players are now contending that VLTs are too mesmerizing, and that makes them deceptive, addictive, and dangerous. The original 2012 lawsuit filed against the Atlantic Lottery made those claims. That case has now been certified as a class action lawsuit.

Allegations Against Atlantic Lottery Corp.

In the original case filed in 2012 the claim was simple. According to the lawsuit “VLTs are inherently deceptive, inherently addictive and inherently dangerous when used as intended.”

Furthermore, the basis of the lawsuit is that video lottery terminals violate the Newfoundland and Labrador criminal code. Essentially, the plaintiffs accuse VLTs of using “cognitive distortions” that give the perception of winning but do not represent actual wins. This, they say, then entices people into losing their money.

According to their argument, the “subliminal priming” inherent in the technology draws players into an extremely focused state, one the documents refer to as a “dangerous dissociative mental state. Essentially, players become “mesmerized” and cannot make rational decisions whether to continue to play or not. In this way, the plaintiffs claim that VLTs are too deceptive and different compared to slot machines or even approved lottery games.

Thousands in Video Lottery Terminals Class Action Lawsuit

The class action lawsuit was filed in the Supreme Court of Newfoundland and Labrador, according to the Wagners law firm’s website. It was then certified on December 30, 2016 with the Atlantic Lottery as the defendant. Moreover, the certified class action apparently has nearly 30,000 people in Newfoundland and Labrador

Ches Crosbie, Q.C., filed the original class action suit. The current one has now been certified by Newfoundland and Labrador Judge Alphonsus Faour. Anyone who paid to play the games after April 2006 are welcome to join the original plaintiffs, listed as Douglas Babstock and Fred Small.

However, the plaintiffs didn’t win every argument in the appeal, including their deceitful gambling claims.

Atlantic Lottery claims that the payout percentage for all VLTs in Newfoundland and Labrador is 93%. Nevertheless, the actual cash-out percentage is often much lower (and varies per machine) due to customers continuing to play with their winnings. The company also claims that it adheres to the responsible gambling regulations by offering in-game reminders of time spent playing, displaying cash amounts instead of credits, and requiring mandatory cashouts after 150 minutes of play.

There are currently approximately 6,300 video lottery terminals in legal jurisdictions around Canada. The court case could force that number to decrease. An overall win for the plaintiffs in this case could also prompt cases in other provinces that could seriously jeopardize Atlantic Lottery’s investment in video lottery terminals.