RALEIGH, NC -- The constitutionality of a 2010 law banning sweepstakes videogames will be put to the test this week as the North Carolina Supreme Court hears arguments in two related cases.
The law was voided in March by the North Carolina appeals court. | SEE STORY
Texas-based sweepstakes game manufacturer Hest Technologies, software maker International Internet Technologies and operator Sandhill Amusements are among the plaintiffs in the case.
The size of North Carolina's sweepstakes videogame industry has been estimated at 1,000 locations generating between $1 billion and $2 billion a year. In June, Gov. Bev Perdue -- an opponent of electronic sweepstakes -- proposed a tax on the devices. But the state's General Assembly adjourned without acting on a tax measure.
The Internet Based Sweepstakes Organization, headed by operator Chase Brooks of Front Edge Marketing (Chapel Hill), has long advocated a tax and regulation framework.
The June 2011 decision by the U.S. Supreme Court affirming free-speech constitutional protection for videogames might play a part as a key precedent in the final decision by North Carolina's high court.
Arguing for the government, the state solicitor general's office will defend the law by asserting sweepstakes videogames are illegal gambling.
Sweepstakes operator Tony Whisnant of the Joker's Wild, a sweepstakes café in Hudson, has predicted that regardless of which side prevails in the North Carolina Supreme Court, the losing side will appeal the case to the U.S. Supreme Court.