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AAMA's Rick Kirby Issues Stern Warning About Merchandisers, Urges Immediate Self-Policing

Posted On: 8/16/2013

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TAGS: Rick Kirby, American Amusement Machine Association, AAMA government relations, amusement machine, claw machine, skill crane, vending machine, prize games, high-value prizes, sweepstakes café, Internet café, coin-op business, coin machine, gambling law, gambling vs. skill

Rick Kirby LISLE, IL -- "We're an industry that often thinks about immediate satisfaction and worries about the consequences later. We need to police ourselves."

That stern warning was delivered by Rick Kirby during the American Amusement Machine Association's government relations luncheon last week. Kirby, a senior-level executive of Betson Enterprises who is co-chairman of AAMA's government relations committee, was speaking before a packed house about the crackdown on amusement venders, and skill cranes, that award prizes -- games that are part of the larger redemption segment.

In some states, amusement merchandisers and skill cranes have come under fire for stocking high-value prizes. In other cases, new laws targeting electronic sweepstakes games and cafés, which are considered illegal gambling in most areas, have unintentionally affected legitimate amusement operations. In Florida , for example, amusement games can only award prizes with a value no higher than 75¢. In California , the Bureau of Gambling Control has notified retail chains "suggesting" they remove skill cranes. The bureau is part of the California Department of Justice, which regulates legal gambling activities in California. Sweepstakes enforcement in both states inadvertently impacted amusements.

As other states create legislation to outlaw sweepstakes cafés, also known as Internet cafés, traditional amusements awarding prizes not unlike these cafés -- gift cards, debit cards and photo prizes (photograph of prize placed inside a machine) --can be swept up in the legal process. In Georgia, where laws shut down 261 cafés, the amusement industry is now working with a $5 wholesale prize limit.

Kirby announced that the AAMA will create a defense fund to raise money to help the industry with possible legal issues concerning redemption games. (Separately, the Pelican Group, an equipment management company, and National Entertainment Network, a nationwide operating company, formed a trust to help combat adverse legislation in June. So far, it has raised about $60,000.)

Kirby said he believes that problems related to prize games are not going away, and says that ultimately the industry's best defense will be to police itself. He is urging self-regulation, and told game manufacturers and distributors that their operator customers must monitor their own adherence to legal, ethical and safety standards. Unscrupulous practices like wrapping money around prizes must end, he underscored, "and we need to take $500 to $800 prizes off the shelf of these merchandise games."

The government luncheon, sponsored by photobooth maker Apple Industries, took place on Aug. 8 during AAMA's annual board meeting at Hilton's Naperville hotel in Lisle, IL. During the weeklong meeting, the legality of merchandising machines was the hot-button topic.

David Cohen of Firestone Financial Corp. co-chairs the government relations committee, which includes Namco's Frank Cosentino, Stern Pinball's Jim Belt, Nickels and Dimes' Kevin Jordan, BMI Merchandise's Dave Schwartz and Game Exchange of CO's Rich Babich, along with Brady Distributing's Jon Brady, Raw Thrills' Eugene Jarvis, AMI Entertainment's John Margold and Family Entertainment Group's George Smith.

Special guest speakers at the committee's Aug. 8 luncheon were Jeanne Ives, an Illinois State Representative (District 42), and John Russell, senior managing director of Dentons, AAMA's lobbying firm.