Ontario Judge Rules GotSkill? Machines Are Gambling, Echoing US Skill Game Battles

An Ontario Superior Court judge has sided with the Alcohol and Gaming Commission of Ontario (AGCO) and ruled that the GotSkill? “skill game” terminals amount to gambling under the law.

In Canada, pure skill contests, such as trivia tournaments, video game competitions, or arcade-style reflex games, are legal, as they are classified as promotional contests that require a math skill-testing question.

Ontario Court Rejects GotSkill? Challenge

Judge Shaun S. Nakatsuru declared that, despite the manufacturer SBG-Skill Based Games Inc. having made adjustments to the games, they still don’t fall under the definition of games of skill. Instead, they are a combination of skill and chance.

In his ruling, Nakatsuru wrote: “Colloquially speaking, the bait may be different, but the lure of a big or bigger win based upon luck is still used.”

He added that “GotSkill remains a game of mixed chance and skill … it continues to hide the potential next wins available in future rounds, inducing its players to pay money … in the hopes of eventually discovering one of value.”

AGCO had already issued a bulletin requiring liquor-licensed establishments to remove the machines. The ruling now clears the way for stricter enforcement across the province.

Player Data Undermined Skill Claim

Evidence cited in court suggested the games are structured to promote long sessions and incremental losses:

• In 2024, Ontario players averaged 27 minutes per session. They spent $15–25 in credits, with an average of 122.8 rounds per session. A significant number of players never used the “Next Wins/Menu” button, meant to preview potential prizes.
• A representative file of 1,000 tickets showed 67.4% had a $0 prize value, another 26% were worth less than $1, and only 0.4% exceeded $5. Even if a player played all 1,000 tickets and scored 100% on each, they would still lose about 6% of their money.

Nakatsuru observed that the design of the game “encourages the playing of GotSkill in quick successive multiple rounds with the hopes of winning big at some future session.”

Skill Game Battles Across the US

Ontario’s case echoes a growing number of legal battles across the US. In the center lies the argument by skill-game manufacturers that their products are not gambling devices and operate within the law. Courts and legislatures have split over the issue:

• Tennessee – A three-judge panel recently ruled that “No Chance Games” machines are illegal gambling devices, supporting enforcement actions across the state.
• Pennsylvania – Courts have sided with manufacturers, but a ruling by the state’s Supreme Court is pending. Meanwhile, lawmakers remain deadlocked on taxing or banning the machines, with proposals ranging from zero to rates exceeding 50%.
• Virginia – The state’s Supreme Court confirmed a 2020 ban. Still, litigation over adjusted device designs continues, giving hope to manufacturers.
• California – Pace-O-Matic is suing after the California Department of Alcoholic Beverage Control seized its devices. The company argues the games meet legal skill standards.
• Texas – An appeals court reaffirmed a 2024 District Court decision that Pace-O-Matic’s devices do not qualify as gambling machines under state law.
• Kentucky – The legislature banned “gray machines” in 2023, and courts have upheld the law against operator challenges.
• Kansas – The Kansas Supreme Court dismissed a lawsuit by a manufacturer seeking to confirm the legality of its skill game.

States Moving Toward Regulation

Skill games do not operate in a gray area everywhere. A few states have moved to regulate and tax them to increase tax revenue:

• Nebraska – In 2011, the state’s Supreme Court ruled that skill games are not illegal gambling. In 2025, lawmakers approved licensing, a central monitoring system, and a 5% net revenue tax for skill games.
• Arkansas – “Electronic Games of Skill” are permitted at racetracks and casinos under Racing Commission oversight.
• Georgia – Longstanding lottery-regulated “coin-operated amusement machines” operate legally with strict licensing and prize restrictions.
• Wyoming – The state regulates and taxes skill-based amusement games, with proposals to raise the tax on proceeds.

Broader Implications

Ontario’s ruling strengthens regulators’ hand in Canada and aligns with many US courts.

Yet, the North American landscape remains divided. Some states, such as Kentucky, have moved toward prohibition. Meanwhile, others, such as Nebraska and Wyoming, prefer to collect tax dollars from them.

While the immediate impact is limited to Ontario, the decision could influence other Canadian courts and regulators to treat similar machines as gambling unless legislation explicitly allows them.