Can North Carolina warehouses legally store video poker machines that would be illegal to operate in the state?
Plain-English summary
Senator R.C. Soles Jr. asked the AG a simple but consequential question: can video poker machines that would be illegal to operate in North Carolina be lawfully stored or warehoused in the state?
Legal Counsel to the Attorney General J. Donald Hobart Jr. answered no in a short letter.
Article 37 of Chapter 14 deals with illegal slot machines and gaming or gambling machines comprehensively. The key statute is N.C. Gen. Stat. § 14-304, which makes it unlawful not just to own or operate, but specifically to "store" a slot machine or device.
The full text of § 14-304 reads:
It shall be unlawful to manufacture, own, store, keep, possess, sell, rent, lease, let on shares, lend or give away, transport, or expose for sale or lease, or to offer to sell, rent, lease, let on shares, lend or give away, or to permit the operation of, or for any person to permit to be placed, maintained, used or kept in any room, space or building owned, leased or occupied by him or under his management or control, any slot machine or device where the user may become entitled to receive any money, credit, allowance, or any thing of value, as defined in G.S. 14-306.
The list of prohibited verbs is striking: manufacture, own, store, keep, possess, sell, rent, lease, lease on shares, lend, give away, transport, expose for sale, offer to lease, permit operation, permit to be placed. The General Assembly built a fence around every plausible relationship with an illegal slot machine. Storage is just one of many prohibited acts.
The reach of the prohibition turns on the § 14-306 definition of "slot machine or device." The definition is broad and includes "any machine . . . that is adapted, or may be readily converted into one that is adapted, for use" as a traditional slot machine or similar gambling device. That sweeps in machines that are not currently operating as gambling devices but could readily be turned into them. A video poker cabinet that has been disabled but could be re-enabled with a few hours' work is still within the prohibition.
The statute has narrow exceptions for amusement devices. The § 14-306 definition does not include "coin-operated machines, video games, and devices used for amusement," including pinball, video games, and other mechanical devices that involve skill or dexterity, that limit accumulated credits or replays to eight, that may award free replays or paper coupons exchangeable for prizes or merchandise worth no more than $10, but that may not be exchanged or converted to money. So traditional family entertainment (pinball, skee-ball, arcade games with capped redemption) is outside the prohibition. Video poker is not.
Several related statutes in Article 37 reinforce the storage prohibition: § 14-295 (keeping illegal punchboards or slot machines), § 14-297 (allowing them on premises), § 14-301 (operation and possession), and § 14-305 (agreements regarding such machines). The comprehensive regulatory scheme leaves little room for a warehouse-only exception.
Violations are Class 2 misdemeanors under § 14-309. The AG's office had advocated for treating possession of unlawful video poker machines as a felony, but at the time of this opinion, the Class 2 misdemeanor framework remained the law.
The practical takeaway in 2000: a warehouse operator could not lawfully accept video poker machines (or other slot-machine-type devices) for storage in North Carolina, even if the machines were destined for shipment out of state for use in jurisdictions where they would be legal. The "transport" verb in § 14-304 covers shipment, and the "store" verb covers the warehousing itself. Both are prohibited, and both are Class 2 misdemeanors.
Currency note
This opinion was issued in 2000. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. North Carolina's gaming statutes have been amended significantly since 2000, including substantial restrictions on video sweepstakes (S.L. 2010-103) and continued evolution of fish-game and skill-game enforcement. The General Assembly has at various points imposed felony treatment on certain video poker offenses. Anyone evaluating a current question about gambling-device storage or distribution in North Carolina should consult current Article 37 statutes, current case law on the "skill versus chance" line, and current enforcement priorities.
Background and statutory framework
Why the storage question matters. North Carolina shares borders with states that have different gambling-device laws. South Carolina, for example, had widespread video poker until a 2000 phase-out. Distributors and importers might want to use North Carolina warehouses to stage machines destined for legal markets. The 2000 opinion forecloses that strategy. The General Assembly's storage prohibition reaches the machine wherever it sits, regardless of its intended destination.
The "readily converted" reach. Section 14-306's definition catches not just operating gambling machines but also machines that "may be readily converted into" gambling machines. This forecloses an obvious evasion: storing a "disabled" video poker machine with the gambling software removed. If the conversion back is straightforward, the machine is within the prohibition. The "readily converted" language is broad and gives prosecutors substantial discretion.
The amusement-device carve-out. The exception for coin-operated amusement devices has specific quantitative limits: eight or fewer accumulated credits or replays at one time, and free replays or coupons exchangeable for prizes/merchandise worth no more than $10. These thresholds keep traditional pinball and arcade-game machines out of the slot-machine prohibition while preventing the carve-out from being used to immunize disguised gambling devices. A machine that allows accumulation of more than eight credits, or that offers cash or cash-equivalent prizes, falls back into the prohibition.
The Article 37 comprehensive scheme. Article 37 reaches the relationship with a gambling machine at every level. Section 14-295 criminalizes keeping illegal punchboards or slot machines. Section 14-297 criminalizes allowing them on premises (so the property owner cannot insulate himself by claiming the machine is someone else's). Section 14-301 covers operation and possession. Section 14-305 reaches contractual agreements about such machines. Together, these statutes leave essentially no lawful posture for an interstate distributor to take in North Carolina.
The Class 2 misdemeanor penalty and the felony advocacy. Section 14-309 set the penalty at Class 2 misdemeanor (maximum 60-day jail sentence for prior-conviction-level offenders, with fines). The AG's office at the time was openly advocating for the General Assembly to elevate video poker possession to felony status, recognizing that the misdemeanor penalty was an inadequate deterrent for a high-revenue criminal enterprise. The legislative history of subsequent gaming amendments reflects how that policy debate evolved.
Comparison to other regulatory regimes. Many regulatory statutes treat possession differently from operation or distribution. Drug statutes, for example, distinguish simple possession from possession with intent to distribute. Gambling-device statutes in some states draw similar lines. North Carolina's § 14-304 does not draw any such line; it treats storage, possession, operation, and distribution as equivalent prohibited conduct. The General Assembly's choice reflects a judgment that the device itself is the problem, regardless of the actor's specific intent.
Why a contemporaneous AG opinion mattered for compliance. Senator Soles's question came up because warehouses, freight forwarders, and distributors were uncertain about North Carolina's posture. A clear AG opinion let compliance counsel advise clients to avoid storing video poker machines in North Carolina. Companies that wanted to serve markets where the machines were legal could route through other states' warehouses.
Common questions
Q: Can a private collector store a disabled vintage slot machine for collection purposes?
A: The opinion does not address private collection. Under a strict reading of § 14-304, even a private collector falls within "store, keep, possess." Some states have collector exceptions; North Carolina's statute does not. Anyone interested in collecting historical gambling machines in North Carolina should consult current statutes and case law before acquiring or storing them.
Q: What about a machine in transit through North Carolina (not stored, just driven through)?
A: The opinion's framework includes "transport" in the prohibited verbs. A truck driver transporting video poker machines through North Carolina to another state would technically violate § 14-304. Whether prosecutors would actually pursue such a case is a different question, but the statutory authority is there.
Q: Are skill-based "fish hunter" or "sweepstakes" machines covered?
A: The opinion does not address these later variations. North Carolina has had extensive litigation and statutory amendments since 2000 addressing skill-based and sweepstakes-based games that look similar to traditional slot machines. The current law on these devices differs from the 2000 framework and should be researched separately.
Q: Can a North Carolina property owner be charged if a tenant stores illegal machines without the owner's knowledge?
A: Section 14-297 (allowing illegal machines on premises) creates liability for the property owner who permits the machines. The opinion does not address knowledge requirements, but knowledge or willful blindness would typically matter. Property owners should know what their tenants are storing.
Citations from the opinion
- N.C. Gen. Stat. Chapter 14, Article 37
- N.C. Gen. Stat. § 14-295
- N.C. Gen. Stat. § 14-297
- N.C. Gen. Stat. § 14-301
- N.C. Gen. Stat. § 14-304
- N.C. Gen. Stat. § 14-305
- N.C. Gen. Stat. § 14-306
- N.C. Gen. Stat. § 14-309
Source
Original opinion text
June 7, 2000
The Honorable R.C. Soles, Jr. North Carolina Senate Room 2022, Legislative Building Raleigh, North Carolina 27601-2808
Dear Senator Soles:
You have asked for the opinion of the Attorney General's office as to whether video games or video poker machines, the operation of which would be illegal in this state under North Carolina law, may nonetheless be lawfully stored or warehoused in the state. The answer to that question is "no."
Article 37 of the North Carolina General Statutes treats the subject of illegal slot machines and other gaming or gambling machines in some detail. The particular statute applicable to your question is N.C. Gen. Stat. § 14-304, which specifically states that it is unlawful not only to own but also to "store" any "slot machine or device where the user may become entitled to receive any money . . . or any thing of value." The types of machines that fall under this prohibition, which include the video games or video poker machines you referenced, are spelled out in N.C. Gen. Stat. § 14-306, which contains the definition of the term "slot machine or device."
The definition is rather extensive and need not be repeated here in full, but it essentially encompasses within its terms "any machine . . . that is adapted, or may be readily converted into one that is adapted, for use" in the manner associated with a traditional slot machine or similar gambling device. N.C. Gen. Stat. § 14-306. The statute also contains a number of exceptions designed to ensure that a variety of lawful machines are not swept under the definition of an illegal slot machine. For example, the definition notes that it "does not include coin-operated machines, video games, and devices used for amusement," including "pinball machines, video games, and other mechanical devices that involve the use of skill or dexterity to make varying scores or tallies and which, in actual operation, limit to eight the number of accumulated credits or replays that may be played at one time and which may award free replays or paper coupons that may be exchanged for prizes or merchandise with a value not exceeding ten dollars ($10.00), but may not be exchanged or converted to money." Id.
It is useful to review the full text of N.C. Gen. Stat. § 14-304 to appreciate the scope of the ban on storage of these machines. The statute reads:
It shall be unlawful to manufacture, own, store, keep, possess, sell, rent, lease, let on shares, lend or give away, transport, or expose for sale or lease, or to offer to sell, rent, lease, let on shares, lend or give away, or to permit the operation of, or for any person to permit to be placed, maintained, used or kept in any room, space or building owned, leased or occupied by him or under his management or control, any slot machine or device where the user may become entitled to receive any money, credit, allowance, or any thing of value, as defined in G.S. 14-306.
N.C. Gen. Stat. § 14-304. The state's regulation and prohibition of these machines is quite comprehensive and several other statutory sections touch on the issue of the lawfulness of storing such machines. These include N.C. Gen. Stat. § 14-295 (keeping illegal punchboards or slot machines), N.C. Gen. Stat. § 14-297 (allowing illegal punchboards or slot machines on premises), N.C. Gen. Stat. § 14-301 (operation and possession of slot machines), and N.C. Gen. Stat. § 14-305 (agreements with reference to slot machines or devices made unlawful). The definition of illegal machines includes not only operational machines, but machines that "may be readily converted into" machines that would violate the law. N.C. Gen. Stat. § 14-306.
Violations of these statutes are treated as Class 2 misdemeanors, see e.g. N.C. Gen. Stat. § 14-309, although this office has advocated that possession of unlawful video poker machines or similar devices be punished as a felony.
At your request, I am also enclosing prior opinions of this office that address the statutes in question.
Very truly yours,
J. Donald Hobart, Jr.
Legal Counsel to the Attorney General