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Video Sweepstakes Violates NC Laws; Businesses Must Remove Gaming Systems

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In 2016, law enforcement agencies raided a Crazie Overstock Promotions, LLC business in Mebane for operating a gambling enterprise in violation of Sections 14- 306.1A and 14-306.4 of N.C. General Statutes. After the raids, Crazie Overstock sued the State of North Carolina and several counties in an Alamance County court. In 2018, Superior Judge Vince M. Rozier, Jr., determined the Crazie Overstock Promotions business violated the law and threw out the lawsuit in Alamance County Superior Court. 

However, the business appealed the Superior Court ruling alleging the ALE agents inaccurately described how the business software operates to obtain search warrants. Also, according to Crazie Overstock, the games they provide are dexterity and skills tests.

To explain the Crazie Overstock gaming system, stores featuring the software sell gift certificates for users to redeem on “Game points” come with certificates and are considered gifts. According to Crazie Overstock representatives, after passing a “dexterity test,” players can redeem reward points for cash.

The Supreme Court of North Carolina heard the case and issued a decision on June 11, 2021.

The Supreme Court ruled that Crazie Overstock’s video sweepstakes system is illegal because the video sweepstakes system is predominated by chance and is played to win money. The Supreme Court characterized the Crazie Overstock “sweepstakes” as pretextual. They acknowledged that these video sweepstakes systems are designed to thwart our State gambling laws, and Crazie Overstock’s Rewards Program should be classified as a game of chance rather than a game of dexterity or skill. 

BladenOnline staff reached out to local law enforcement about the court ruling because some Bladen County businesses are continuing to use the video sweepstakes systems. On Friday, Bladen County Sheriff Jim McVicker stated that local businesses have 20 days to remove gaming machines from their businesses.

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