1 Dragon's Ascent Video Gaming Machine v. SLED

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

1 Dragon's Ascent Video Gaming Machine; SC Games of
Skill, LLC; Respondents,

v.

South Carolina Law Enforcement Division, Appellant.

Appellate Case No. 2023-000783

Appeal From Berkeley County
Bentley Price, Circuit Court Judge

Opinion No. 6098
Heard November 7, 2024 – Filed February 5, 2025

REVERSED

Adam L. Whitsett, of Columbia, for Appellant.

Peter Michael McCoy, Jr., of McCoy Law Group, LLC,
of Charleston; Kirsten Elena Small, of Maynard Nexsen,
PC, of Greenville; Christopher John Murphy, of Murphy
Crantford Meehan, Attorneys at Law, LLC, of
Summerville; and William W. Wilkins, of Billy Wilkins
Law LLC, of Greenville, all for Respondents.

HEWITT, J.: This case concerns a "Dragon's Ascent" video game machine. The
South Carolina Law Enforcement Division (SLED) confiscated the machine from a
business in Hanahan after deciding it was an illegal gambling device. A magistrate
found the device to be a game where skill predominated over chance but still
concluded the device was illegal under South Carolina law because it was "used for
gambling." The game and its owner (Respondents) appealed to the circuit court.
The circuit court agreed the game was one of skill but found this meant the machine
was legal based on the view that legality under the relevant statute "begins and ends"
with the skill versus chance inquiry. SLED appealed to this court.

The sole issue before us is whether the statute in question—section 12-21-2710 of
the South Carolina Code—only prohibits games of chance or also prohibits
machines and devices that can be used for gambling. The statute's text, its history,
and precedent all strongly support the latter view. For those reasons, we reverse.

BACKGROUND

After SLED received a complaint about an illegal gambling device being used at a
Hanahan restaurant/bar, "LG's By the Creek," a special agent conducted three
separate undercover visits to the business. He played the Dragon's Ascent machine
at issue each time before ultimately seizing it.

The basic features of the Dragon's Ascent game do not appear to be in dispute. The
game was created to be a game that exclusively relies on skill and has no element of
chance. The game's stated goal is to "[s]hoot dragons to win credits!" The game
features various dragons, all of different colors and sizes, that continuously move
across the video screen. Credits earned by shooting dragons are redeemable for cash.

The machine at issue here has two player stations and one video monitor. There are
versions of Dragon's Ascent where the game is played on a large table with multiple
player stations surrounding the table, but that sort of machine is not before us, and,
as our standard of review section explains, our review in this case is limited to the
individual machine that SLED seized.

Dragon's Ascent always allows a player to access a "Help Screen," even prior to
beginning play. This screen provides extensive instructions on how to play and how
to win the game. Play begins after a player inserts currency into the bill acceptor on
the front of the machine and confirms he or she is eighteen years of age. Initial play
"credits" are based on how much money a player deposits into the machine.

A player is represented on the video screen by a turret. The turret is controlled by a
joystick that players use to aim at dragons. A shot button is then used to fire. Each
shot has a "value" that the player can adjust using a "Shot Cost" feature. Shot values
range from ten cents to two dollars and can be adjusted between shots.
The amount awarded for capturing a dragon is based on the player's shot value and
the player's ability to match the color of his or her turret to the color of the targeted
dragon. The color of the player's turret changes on a pattern throughout play. For
some dragons, rewards range from two times the shot cost to ten times the shot cost,
depending on color matching, while other dragons have rewards ranging from fifty
times to two hundred fifty times the shot cost. These award amounts or multipliers
are disclosed to players in a "Reward Chart" on the Help Screen.

The largest single reward available in the game comes from a particular dragon
called the "Rainbow Dragon," but the amount of this reward is not disclosed on the
Reward Chart. The reward for the Rainbow Dragon depends on variables such as
shot value and the number of shots fired (including shots fired by other players)
directly at the dragon. Players may also receive "interim rewards" as the Rainbow
Dragon's "health" begins to drain and it becomes more susceptible to capture.

A game session ends when a player's credits run down to zero, or, put differently,
when the player loses all of the money deposited into the machine. If a player wishes
to end the session before all the credits have run, the player may print a ticket receipt.
This receipt is exchangeable for cash.

After the SLED agent seized the machine at issue here, it was taken to the magistrate
court, where a magistrate found it to be an illegal gambling device prohibited by the
statute. A post-seizure hearing was held several months later.

The magistrate heard extensive arguments, received testimony, and watched as
Dragon's Ascent's lead designer demonstrated how to successfully play the game.
The magistrate issued a written order finding that the game was one "in which skill
predominates over chance," but found that the game was nevertheless illegal because
it was used for gambling. The magistrate relied on our supreme court's opinion in
Town of Mount Pleasant v. Chimento, 401 S.C. 522, 737 S.E.2d 830 (2012)
(upholding convictions for playing "Texas Hold'em" in a residence), in concluding
that "the determination as to whether th[e] Dragon's Ascent machine is an illegal
gambling device is not limited to the skill/chance ratio, but rather on the existence
of a wager."

Respondents appealed to the circuit court. As described at the beginning of this
opinion, the circuit court agreed with Respondents that an analysis of illegality under
the statute "begins and ends" with whether the game is one of skill or one of chance.
The circuit court distinguished Chimento by reasoning that the case involved a
different statute and did not concern the question whether a particular machine was
an illegal gambling device. This appeal followed.

STANDARD OF REVIEW

"Section 18-7-170 of the South Carolina Code ([2014]) articulates the standard of
review to be applied by the circuit court in an appeal of a magistrate's judgment . . . ."
Bowers v. Thomas, 373 S.C. 240, 244, 644 S.E.2d 751, 753 (Ct. App. 2007). The
circuit court, as the initial appellate court, must "give judgment according to the
justice of the case, without regard to technical errors and defects which do not affect
the merits." § 18-7-170. "In giving judgment[,] the court may affirm or reverse the
judgment of the court below, in whole or in part, as to any or all the parties and for
errors of law or fact." Id.

Our review in this posture can be limited if factual findings are involved. See Union
Cnty. Sheriff's Off. v. Henderson, 395 S.C. 516, 519, 719 S.E.2d 665, 666 (2011)
("The magistrate's factual findings, confirmed by the circuit court, must be upheld
by the appellate court if supported by any evidence."). But when it comes to
questions of law, and particularly questions of statutory interpretation, our review is
de novo. Town of Summerville v. City of North Charleston, 378 S.C. 107, 110, 662
S.E.2d 40, 41 (2008) ("Determining the proper interpretation of a statute is a question
of law, and this [c]ourt reviews questions of law de novo.").

Last, we specify that the case before us deals only with the specific Dragon's Ascent
machine found at LG's By the Creek. See Mims Amusement Co. v. S.C. L. Enf't Div.,
366 S.C. 141, 155, 621 S.E.2d 344, 351 (2005) ("[A] magistrate's ruling on legality
applies only to the machine before the court."); id. ("[T]he legality of a particular
machine must be determined on an individual basis at the time of seizure and
examination.").

ANALYSIS

As mentioned before, this appeal turns on a legal question—whether certain
language of the relevant statute prohibits only games of chance, or whether it also
prohibits machines or devices allowing games of skill to be used for gambling. The
case has this narrow focus because SLED does not challenge the finding that
Dragon's Ascent is predominately a game of skill and Respondents have insisted
throughout this case that the machine must be deemed legal because the inquiry stops
once skill is found to predominate chance. With that in mind, we turn first to our
analysis of the statute's text and history.
Statutory Construction

The relevant statute is section 12-21-2710. The statute is titled "Types of machines
and devices prohibited by law; penalties." S.C. Code Ann. § 12-21-2710
(Supp. 2024). The statute separately prohibits several different categories of
machines and devices, one of which is "device[s] pertaining to games of chance of
whatever name or kind," but another of which is "device[s] licensed pursuant to [a
different statute] and used for gambling." Id. In pertinent part, the statute provides:

It is unlawful for any person to keep on his premises or
operate or permit to be kept on his premises or operated
within this State . . . any machine or device licensed
pursuant to Section 12-21-2720 and used for gambling or
any punch board, pull board, or other device pertaining to
games of chance of whatever name or kind . . . .

Id. (emphasis added). We see our conclusion that these are separate prohibitions as
a straightforward application of the rule that we begin (and can often stop) statutory
interpretation with the statute's text. See Hawkins v. Bruno Yacht Sales, Inc., 353
S.C. 31, 39, 577 S.E.2d 202, 207 (2003) ("The cardinal rule of statutory construction
is to ascertain and effectuate the intent of the legislature."); see also Hodges v.
Rainey, 341 S.C. 79, 85, 533 S.E.2d 578, 581 (2000) (considering the plain text of a
statute "the best evidence of the legislat[ure's] intent or will" and requiring courts to
give effect to that language) (quoting Norman J. Singer, Sutherland Statutory
Construction § 46.03 at 94 (5th ed. 1992))). The statute prohibits coin-operated
machines with a free play feature; coin-operated machines used for playing certain
games like poker and blackjack; machines and devices used for gambling; and punch
boards, pull boards, or other devices pertaining to games of chance. § 12-21-2710.
If Respondents were correct that the legal definition of "gambling" under this statute
is limited to games of chance, there would be no conceivable reason for the clause
prohibiting licensed machines used for gambling.

We readily acknowledge that most previous cases evaluating potential gambling
devices focused on whether particular games were games of chance. See, e.g.,
S.C. L. Enf't Div. v. 1-Speedmaster S/N 00218, 397 S.C. 94, 97–100, 723 S.E.2d 809,
811–12 (Ct. App. 2011) (relying on the lack of chance in determining a game did
not constitute illegal gambling); Ward v. W. Oil Co., 387 S.C. 268, 272–78, 692
S.E.2d 516, 519–22 (2010) (including an element of chance in its gambling analysis
under section 12-21-2170; however, the specific provision applied there was "any
punch board, pull board, or other device pertaining to games of chance" (emphasis
added)); Sun Light Prepaid Phonecard Co. v. State, 360 S.C. 49, 53–56, 600 S.E.2d
61, 63–65 (2004) (same as Ward). Even so, our reading of the relevant statute is
bolstered by the history of our legislature's "longstanding prohibition against
gambling," Chimento, 401 S.C. at 538, 737 S.E.2d at 840 (Toal, C.J., concurring),
and the fact that the legislature added the "used for gambling" language after the
statute already prohibited games of chance. See Senate by & through Leatherman
v. McMaster, 425 S.C. 315, 322, 821 S.E.2d 908, 912 (2018) ("[Courts] should not
concentrate on isolated phrases within [a] statute[, and instead] . . . must read the
statute so 'that no word, clause, sentence, provision or part shall be rendered
surplusage, or superfluous,' for '[t]he General Assembly obviously intended [each
provision] to have some efficacy, or the legislature would not have enacted [the
statute] into law.'" (quoting CFRE, L.L.C. v. Greenville Cty. Assessor, 395 S.C. 67,
74, 716 S.E.2d 877, 881 (2011))).

Since as early as 1816, the General Assembly has expressed its clear disapproval of
gambling. Chimento, 401 S.C. at 537, 737 S.E.2d at 840 (Toal, C.J., concurring).
South Carolina has outlawed gambling devices for decades. Westside Quik Shop,
Inc. v. Stewart, 341 S.C. 297, 300, 534 S.E.2d 270, 271 (2000), overruled on other
grounds by Byrd v. City of Hartsville, 365 S.C. 650, 620 S.E.2d 76 (2005).

As time has passed, the General Assembly has progressively broadened what the
statute prohibits. In the early 1930s, in what appears to be the first statute outlawing
the possession of gambling devices, the General Assembly provided:

It shall be unlawful for any person to keep on his premises
or operate or permit to be kept on his premises or operated
within this State, any slot machine of whatever name or
kind, except automatic weighing, measuring, musical and
vending machines which are so constructed as to give a
certain uniform and fair return in value for each coin
deposited therein, and in which there is no element of
chance.

1932 Code of Laws § 1301-A. In 1942, the legislature extended the list of prohibited
devices to include "any vending or slot machine, punch boards[,] pull boards, or
other devices pertaining to games of chance of whatever name or kind" while
maintaining the exemption for certain games with no element of chance. 1942 Code
of Laws § 1301-1(1). Then, in 1999, the statute was amended to specifically prohibit
devices allowing individuals to play poker, other specific games, and "any machine
or device . . . used for gambling." Act. No. 125, 1999 S.C. Acts 1322. Thus, for
over fifty years prior to the 1999 amendment, the law already prohibited games of
chance. See § 1301-1(1). The addition of blackjack and poker illustrates a need to
prohibit certain specific games, but the language prohibiting machines "used for
gambling" can only be understood as broadening the legislature's prohibitions on
gambling. It is difficult to understand the addition of this language if those
prohibited devices must also "pertain[] to games of chance." That argument is
severely undermined by the disjunctive "or" separating games used for gambling and
games of chance. § 12-21-2710.

For these reasons, we conclude the statute does not narrowly prohibit only the listed
games and games of chance, but instead includes in its prohibitions any licensed
device used for gambling.1

Chimento and the Definition of Gambling

While our reading of the relevant statute leads us to the firm conclusion that the
statute draws a distinction between games used for gambling and games of chance,
the section itself does not include a definition of "gambling." Respondents maintain
that in order for a game to constitute gambling, chance must predominate over skill.
SLED points us to our supreme court's decision in Chimento for a definition of
gambling that includes games of skill when something of value is wagered on the
outcome. Respondents counter that Chimento does not apply here because that case
dealt with a different statute, section 16-19-40 of the South Carolina Code (2015),
which criminalizes gaming and betting in certain locations.

Though Respondents are correct that the issue in Chimento centered around a
different statute than the one at issue here, we are not able to reconcile Respondents'

1
The machine at issue here was not licensed, but Respondents conceded to the
magistrate that it should have been licensed and claimed it was an inadvertent
mistake. As the magistrate found, it would be absurd for a gambling machine to be
legal based on the failure to obtain a license for the machine, whether inadvertent or
not. See Lancaster Cnty. Bar Ass'n v. S.C. Comm'n on Indigent Def., 380 S.C. 219,
222, 670 S.E.2d 371, 373 (2008) ("In construing a statute, [courts] will reject an
interpretation when such an interpretation leads to an absurd result that could not
have been intended by the legislature."); see also § 12-21-2710 (prohibiting "any
machine or device licensed pursuant to Section 12-21-2720 and used for gambling"
(emphasis added)).
argument that Chimento does not apply with the analysis and approach our supreme
court employed in that case. Chimento did not focus solely on section 16-19-40.
The court wrote, "The statutory meaning of the word 'gambling' in South Carolina
includes games in which skill outweighs chance." 401 S.C. at 533, 737 S.E.2d at
837 (emphasis added). The court looked to other statutes and precedent:

For example, [section] 32-1-10 [of the South Carolina
Code] (2007), found in an article captioned "Gambling
Contracts," permits persons who have lost money or other
thing(s) of value in an amount equal to at least $50 at
cards, at a dice table, or "at any other game whatsoever,"
or by betting on those games, to recover their losses under
certain circumstances. The plaintiffs in such a suit are
almost uniformly referred to as "gamblers" regardless
whether the enterprise was unlawful. See Berkebile v.
Outen, 311 S.C. 50, 426 S.E.2d 760 (1993).

Id. at 532, 737 S.E.2d at 837.

While the court based some of its analysis on the text of section 16-19-40 (the statute
at issue there), it nevertheless concluded: "Gambling as defined in South Carolina
includes betting money on the outcome of any 'game' whatsoever, regardless of the
amount of skill involved in the game." Id. at 532–33, 737 S.E.2d at 837 (emphasis
added) (quoting § 32-1-10). In other words, the court held, "Whether an activity is
gaming/gambling is not dependent upon the relative roles of chance and skill, but
whether there is money or something of value wagered on the game's outcome." Id.
at 533, 737 S.E.2d at 838 (emphases added); see also, e.g., State v. Red, 41 S.C.L.
(7 Rich.) 8 (1853) ("If the prohibited games be confined to those alone in which the
stake is won or lost by chance, the result would follow, that the gambler who relied
on the practiced legerdemain of a juggler, whilst he professed that the stake
depended on fortune, will escape punishment by playing falsely.").

And while it is true that Chimento was not analyzing gambling under section
12-21-2710, it is worth mentioning that section 16-19-40 similarly criminalizes
playing "any machine or device licensed . . . and used for gambling purposes . . . ."
Compare S.C. Code Ann. § 16-19-40(g) (2015) with § 12-21-2710 (deeming "any
machine or device licensed pursuant to [another section] and used for gambling"
unlawful). We construe statutes regarding the same subject with a "harmonious
result" in mind. Joiner ex rel. Rivas v. Rivas, 342 S.C. 102, 109, 536 S.E.2d 372,
375 (2000). We cannot meaningfully distinguish Chimento as relating to a
completely separate statute when the language in that statute has significant overlap
with the language in section 12-21-2710.

Respondents point us to this court's decision in Speedmaster as support for their
argument that gambling must include an element of chance. There, this court relied
on the usual evaluation of skill versus chance in determining whether a particular
game constituted illegal gambling. Speedmaster, 397 S.C. at 97–99, 723 S.E.2d at
811. This court went on to address the parties' dispute over whether the "used for
gambling" portion of section 12-21-2710 meant that the statute did not prohibit mere
possession of an illegal device but instead required the machine to actually be in use.
Id. at 99, 723 S.E.2d at 811–12. This court concluded that the statute does not
specifically require an illegal gaming device be actually in use. Id. at 100, 723
S.E.2d at 812; see also State v. 192 Coin-Operated Video Game Machines, 338 S.C.
176, 188, 525 S.E.2d 872, 879 (2000) ("The plain language of [section 12-21-2710]
makes clear the legislature's intent to outlaw mere possession of such [unlawful]
machines." (emphasis added)). Still, this court wrote that because "gambling
necessarily encompasses the element of chance[,]" and the game there was not one
of chance, "the circuit court properly affirmed the magistrate's ruling the [game] was
not 'used for gambling.'" Speedmaster, 397 S.C. at 100, 723 S.E.2d at 812.

To put the point simply, Chimento was released over a year after Speedmaster, and
we believe Chimento's analysis controls. The circuit court here limited Chimento
because it did not explicitly overrule Speedmaster or any other cases, but as
described above, we simply cannot read Chimento as limiting its conclusions to a
single statute. We hasten to add that we do not read Chimento as abolishing the skill
versus chance analysis; instead, we read Chimento as recognizing the common-sense
fact that a game of chance and a game of skill can both be "used for gambling." This
neatly tracks with what we see as the obvious purpose of the language in question,
which is to prohibit gaming machines that attract players to deposit money for the
purpose of trying to "win" more, whether by skill or chance.

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. We need not address any remaining issues
based on the foregoing conclusions. See Futch v. McAllister Towing of Georgetown,
Inc., 335 S.C. 598, 613, 518 S.E.2d 591, 598 (1999) (ruling it unnecessary for an
appellate court to address remaining issues when its resolution of a prior issue is
dispositive).
The circuit court's decision is

REVERSED.

THOMAS and VINSON, JJ., concur.