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Why South Carolina's Video Poker Ban Still Haunts the Skill Game Industry

By GamesOfSkillMag Editorial7 min read
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The South Carolina video poker ban took effect July 1, 2000, under Part I of Act 125 of 1999, which prohibited cash payouts on video gaming devices. The state Supreme Court struck down a planned voter referendum but upheld the payout ban. The catch-all wording Act 125 added still shapes how South Carolina courts judge cash-prize skill games.

The ban removed a very large business. The Post and Courier reported in 2012 that "At its height, the $2.8 billion-a-year industry had about 36,000 video poker machines in 7,000 locations around the state." More than 25 years later, the statute written to end video poker is the one South Carolina skill-game operators have to deal with.

How Act 125 ended video poker

Act 125 was split into parts. As the South Carolina Supreme Court described it in Joytime Distributors & Amusement Co. v. State, "Part I prohibits cash payouts on video gaming devices effective July 1, 2000." Part II called for a referendum "to ascertain whether or not video game machine payouts will continue to be allowed" in the state.

In its October 14, 1999 decision, the court held that Part II was an unconstitutional delegation of legislative power. It also held that Part I was a "free standing enactment" and upheld it. The result was that the payout ban took effect on schedule and voters never decided the question. The court also upheld Part IV of the act and found Joytime entitled to a refund of surcharge fees.

The wording that outlived video poker

Act 125 also changed the device statute. SC Code § 12-21-2710 prohibits keeping or operating slot machines and devices "for the play of poker, blackjack, keno, lotto, bingo, or craps." It also prohibits "any machine or device licensed pursuant to Section 12-21-2720 and used for gambling" and devices "pertaining to games of chance." A violation is a misdemeanor punishable by a fine of up to $500, up to one year of imprisonment, or both. A 2022 amendment (Act No. 190, H.4161, effective May 16, 2022) added an exemption for manufacturers that make or transport gaming devices for use in other jurisdictions.

Under § 12-21-2712, whose history also traces to Act 125, law enforcement must seize a prohibited device and take it before a county magistrate. If the magistrate is satisfied that the device violates the law, the magistrate must "direct that it be immediately destroyed."

A decade of workarounds

The ban did not end the trade in machines. The Post and Courier reported in 2012 that sweepstakes machines were spreading through convenience stores and internet cafes, noting that "One count estimates that there are as many as 1,000 machines in play." That same year, WPDE reported that magistrates and judges were ruling inconsistently on the new machines. Horry County Solicitor Greg Hembree told the station: "It's not about right and wrong, it's about, "What can we get away with, and will it be profitable to get away with it for this period of time..."" Hembree argued that felony penalties were needed.

Dragon's Ascent: skill was not enough

The 1999 wording was tested directly in Dragon's Ascent Video Gaming Machine SC LLC and SC Games of Skill, LLC v. SLED, a South Carolina Court of Appeals opinion filed February 5, 2025 (Opinion 6098). A SLED agent seized the machine from LG's By the Creek, a restaurant and bar in Hanahan. Players shoot dragons to earn credits that can be redeemed for cash. The magistrate found that skill predominated over chance but still held the machine illegal because it was used for gambling. The circuit court reversed, holding that legality "begins and ends" with the skill-versus-chance question.

The Court of Appeals disagreed. It traced the controlling language to 1999, when the statute was amended to prohibit "any machine or device ․ used for gambling." Its conclusion: "The circuit court erred in ending its analysis with the skill versus chance inquiry. We therefore reinstate the magistrate's order finding that this Dragon's Ascent machine was used for illegal gambling." SC Lawyers Weekly summarized the holding as meaning § 12-21-2710 "does not narrowly prohibit only the listed games and games of chance, but instead includes in its prohibitions any licensed device used for gambling."

The 2025-26 legislative response

Two bills would change that outcome for some games. S.362, sponsored by Sens. Adams, Tedder, Ott, Zell and Graham, would add § 16-19-5. Under it, paying a fee to play a non-card-based game in which skill predominates over chance, and winning a prize in proportion to the player's skill, would not be gambling. The official bill history shows S.362 was introduced and referred to Senate Judiciary on February 19, 2025.

H.4129 contains the same exemption and states that "Nothing in this section should be misinterpreted as permitting any physical or electronic card-based game." According to its bill history, the House passed it on second reading 99-9 on May 7, 2025. On May 8, 2025, it was read a third time, sent to the Senate and referred to Senate Judiciary.

The State reported on February 11, 2026 that a Senate subcommittee chaired by Sen. Brian Adams (R-Berkeley) unanimously sent the House and Senate proposals to the full committee. According to that report, SLED General Counsel Adam Whitsett warned that the proposals would lead to litigation across the state over whether electronic games involve skill or chance. Whitsett opposes cash payouts on gaming machines but said SLED would not treat tournament entry fees as gambling. Restaurant and bar owners told the subcommittee they had earned "thousands to tens of thousands of dollars" from machines before the prohibition.

Why it matters beyond South Carolina

In South Carolina, a statute aimed at video poker, not a skill test, decides whether a cash-prize machine is legal. Other states are also moving away from a skill-only analysis. WJAC reported on June 15, 2026 that the Pennsylvania Supreme Court held skill games are gambling devices subject to state gaming regulation and gave businesses a 120-day window before enforcement. WJAC estimated that Pennsylvania has about 70,000 skill machines. Pennsylvania Attorney General Dave Sunday said the machines "cannot legally exist without the same oversight, regulation and accountability as other forms of legalized gaming." Each state's result rests on its own statutes, and neither decision establishes the law anywhere else.

What operators and vendors should take from it

These points come from the sources above. In South Carolina, a magistrate's finding that skill predominates did not save a cash-prize machine that was used for gambling. Card-based games are excluded even under the proposed exemptions. Seized devices that a magistrate finds unlawful must be destroyed.

Editorial view: in any state, read the device statute's catch-all wording, not only its skill-versus-chance test, and get advice from qualified local counsel before placing equipment. If you are comparing suppliers, our vendor comparison checklist records the questions you asked and the evidence you received. It is a worksheet, not a legal approval or a vendor verification.

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.

Frequently asked questions

When did the South Carolina video poker ban take effect?

Part I of Act 125 of 1999 prohibited cash payouts on video gaming devices effective July 1, 2000. The South Carolina Supreme Court upheld that ban in Joytime Distributors & Amusement Co. v. State on October 14, 1999.

Did South Carolina voters approve the video poker ban?

No. Act 125 called for a referendum on payouts, but the South Carolina Supreme Court struck that part down as an unconstitutional delegation of legislative power. It upheld the payout ban as a free standing enactment, so the ban took effect without a vote.

Are skill games legal in South Carolina if skill predominates?

A skill finding has not been enough by itself. In Dragon's Ascent v. SLED (February 5, 2025), the Court of Appeals reinstated a magistrate's order finding a machine illegal because it was used for gambling, even though the magistrate had found that skill predominated.

What is the penalty under SC Code 12-21-2710?

A violation is a misdemeanor punishable by a fine of up to $500, up to one year of imprisonment, or both. Under Section 12-21-2712, a device a magistrate finds unlawful must be destroyed.

Would H.4129 or S.362 legalize card-based skill games?

No. Both bills cover only non-card-based games in which skill predominates, and H.4129 says nothing in it permits any physical or electronic card-based game. H.4129 passed the South Carolina House 99-9 in May 2025 and was referred to Senate Judiciary.