INDEPENDENT SKILL GAMING INTELLIGENCEA VYZE MEDIA PUBLICATION ↗
GamesOfSkillMag

CASH-PRIZE MACHINES.
BUSINESS. REGULATION.

Laws & Regulation
8 min read

Texas Gambling Device Definition: What Counts Under Penal Code §47.01(4)

By GamesOfSkillMag Editorial8 min read
This article was created with AI assistance and reviewed in our publication workflow. Learn more
Share
Four blank graphite-metal panels stacked in nested, offset frames on an off-white surface, with a small lime-green cube resting where they meet and a steel ruler lying in front.

Under Texas Penal Code §47.01(4), a gambling device is any electronic, electromechanical or mechanical contrivance that, for consideration, gives a player the chance to obtain anything of value, where the award is determined solely or partially by chance, even when some skill is involved, and whether or not the machine pays the prize automatically.

This explainer covers the statutory test in Texas. It is not a determination that any particular machine is legal or illegal.

Why the definition matters

Texas Penal Code Chapter 47 has no stand-alone "gambling device" offense. Section 47.01 defines the term, and other sections make it a crime to possess or promote gambling devices or to keep a place where they are played. Whether a machine meets the definition therefore decides whether those offenses can apply. According to the Texas Legislature Online statute page, §47.01 was last amended by Acts 1995, 74th Leg., ch. 318, Sec. 19, effective September 1, 1995.

The core definition, element by element

The statute reads: "'Gambling device' means any electronic, electromechanical, or mechanical contrivance not excluded under Paragraph (B) that for a consideration affords the player an opportunity to obtain anything of value, the award of which is determined solely or partially by chance, even though accompanied by some skill, whether or not the prize is automatically paid by the contrivance."

  • Consideration: the player pays to play.

  • Anything of value: the player can obtain something of value.

  • Chance: the award depends "solely or partially" on chance. The phrase "even though accompanied by some skill" means that a skill element alone does not take a machine outside the definition.

  • Payout method: it does not matter whether the machine pays the prize itself.

Paragraph (A): listed examples

Paragraph (A) says the term "includes, but is not limited to, gambling device versions of bingo, keno, blackjack, lottery, roulette, video poker, or similar electronic, electromechanical, or mechanical games, or facsimiles thereof, that operate by chance or partially so, that as a result of the play or operation of the game award credits or free games, and that record the number of free games or credits so awarded and the cancellation or removal of the free games or credits."

Paragraph (B): the "fuzzy animal" exclusion

The only carve-out is narrow. It covers a contrivance "designed, made, and adapted solely for bona fide amusement purposes" that meets every one of these conditions:

  • It rewards the player exclusively with "noncash merchandise prizes, toys, or novelties, or a representation of value redeemable for those items."

  • The wholesale value available from a single play is "not more than 10 times the amount charged to play the game or device once or $5, whichever is less."

The cap is the lesser figure. At 25 cents a play, the cap is $2.50. At $1 a play, the cap is $5, not $10.

  • Bet (§47.01(1)): "an agreement to win or lose something of value solely or partially by chance." It excludes insurance and indemnity or guaranty contracts; offers of a prize "to the actual contestants in a bona fide contest for the determination of skill, speed, strength, or endurance" (or to owners of animals, vehicles, watercraft or aircraft entered in a contest); and merchandise worth no more than $25 offered at certain nonprofit-sponsored carnival contests.

  • Thing of value (§47.01(9)): "any benefit, but does not include an unrecorded and immediate right of replay not exchangeable for value."

  • Gambling place (§47.01(3)): any property "one of the uses of which is" making or settling bets, bookmaking, conducting a lottery or "the playing of gambling devices."

  • Private place (§47.01(8)): a place the public cannot access. It expressly excludes restaurants, taverns, nightclubs and the common areas of shops and other buildings.

Chapter 47 does not separately define "prize." The word appears only inside the gambling-device definition.

Where the definition applies

Under the Penal Code:

  • §47.06, possession of a gambling device: covers a person who, "with the intent to further gambling," knowingly owns, manufactures, transfers or possesses a device or essential part known to be designed for gambling. It is a Class A misdemeanor. Section 47.06(d) provides a defense when the gambling occurs entirely in a private place, no one receives an economic benefit other than personal winnings, and, apart from skill or luck, all participants have the same chance of winning.

  • §47.04, keeping a gambling place: covers knowingly using or permitting property to be used as a gambling place, or renting it out expecting that use. It is a Class A misdemeanor.

  • §47.03, gambling promotion: Class A misdemeanor.

  • §47.02, gambling: Class C misdemeanor.

How Texas courts have read it

Hardy v. State (2003). In Hardy v. State, 102 S.W.3d 123 (No. 01-0779, decided April 3, 2003), the Texas Supreme Court held that "gift certificates like those awarded here are equivalent to the monetary amount on the face thereof in cash." It also held that machines dispensing tickets exchangeable for those certificates "do not come within the exclusion." In a summary for The Texas Prosecutor (TDCAA, July-August 2008), Markus Kypreos wrote that 8-liners dispensing tickets "redeemable for cash, even if used only for additional play, or for gift certificates redeemable at local retailers" do not meet the exclusion as a matter of law. The article also cites the companion case, State v. One Super Cherry Master 8-Liner Machine, 102 S.W.3d 132 (Tex. 2003), and calls §47.01(4) "a hypertechnical definition."

City of Fort Worth v. Rylie. In Rylie II, 602 S.W.3d 459 (Tex. 2020), the operators conceded that their eight-liners were gambling devices but argued that the machines fit the fuzzy-animal exclusion. The Texas Supreme Court held that whether the machines were constitutional and legal mattered to the question of Chapter 2153 preemption, and it remanded the case. On remand, the Second Court of Appeals in Fort Worth (No. 02-17-00185-CV, March 17, 2022) held that "the Operators' eight-liners are lotteries, and they are unconstitutional." It described a lottery as requiring, at a minimum, consideration, chance and a prize. According to Texas Civil Justice League reporting, the court held that the Legislature cannot "statutorily remove from the definition of 'lottery'" a game that meets the constitutional meaning. TCJL, an advocacy group, reported that the Texas Supreme Court denied review on December 15, 2023.

Occupations Code §2153.003 says the coin-operated machine chapter "does not authorize or permit the keeping, exhibition, operation, display, or maintenance of a machine, device, or table prohibited by the constitution of this state or the Penal Code." Section 2153.002(9) defines a "skill or pleasure coin-operated machine" broadly, but that licensing category is separate from the Penal Code test. A machine's registration, tax status or "skill" label does not settle whether it meets the gambling-device definition.

The elements in the statute and case law

From the statute and the cases above, the factors in the Texas analysis are consideration, whether chance plays any part in the award, what kind of reward is given (noncash merchandise or something else), whether a reward works as a cash equivalent, the wholesale value available per play against the lesser-of cap, and whether the machine is made solely for bona fide amusement. The constitutional lottery analysis in Rylie is a separate question. Operators comparing suppliers can record these questions and the vendor's evidence in our vendor comparison checklist. The checklist records diligence. It does not provide legal approval.

Sources

Reporting is for information, not legal advice. A vendor listing or the term skill game does not establish a machine's legality in any jurisdiction.

AI assistance was used in preparing this article. Consult primary sources and qualified counsel for legal decisions.

Frequently asked questions

Does skill take a machine out of the Texas gambling device definition?

Not by itself. Penal Code §47.01(4) covers devices whose award is determined "solely or partially by chance, even though accompanied by some skill."

What is the fuzzy animal exclusion in Texas?

Section 47.01(4)(B) excludes devices made solely for bona fide amusement that reward only noncash merchandise, toys or novelties, or a representation redeemable for them. The wholesale value per single play cannot exceed 10 times the price of one play or $5, whichever is less.

Are gift certificates allowed under the Texas exclusion?

In Hardy v. State (2003), the Texas Supreme Court held that the gift certificates in that case were equivalent to cash in the face amount. It held that machines dispensing tickets exchangeable for them did not fall within the exclusion.

Does a Texas coin-op license make a machine legal?

No. Occupations Code §2153.003 states that the coin-operated machine chapter does not authorize machines prohibited by the Texas Constitution or the Penal Code.

What is the penalty for possessing a gambling device in Texas?

Under Penal Code §47.06, knowingly possessing a gambling device with intent to further gambling is a Class A misdemeanor. A defense applies to certain gambling that occurs entirely in a private place.