Torch Electronics, a prominent distributor of “gray market” gaming machines in Missouri, has found itself in hot water after a federal jury deemed its business practices unfair. The case, which concluded on Monday in St. Louis, saw the jury ordering Torch Electronics to pay $500,000 in damages to rival company TNT Amusements. The core of the conflict lies in the allegations that Torch provided misleading information to retailers about the legality of their gaming devices, which are commonly found in gas stations and convenience stores across the state.
The judgment is the culmination of a long-standing feud between the two companies. TNT claims that Torch’s marketing of its machines as legal “no-chance” games led to the displacement of TNT’s arcade-style equipment. This dispute highlights the murky nature of Missouri’s unregulated gaming industry. According to Torch, their machines comply with state gambling laws by allowing players to see the next spin’s outcome using a “prize viewer.” However, TNT’s legal team argues that this feature is nothing more than a disguise, maintaining that the machines still rely on luck and are therefore illegal under state regulations.
The trial, overseen by Senior US District Judge John Ross, shed significant light on the financial underpinnings of Missouri’s unregulated
The trial, overseen by Senior US District Judge John Ross, shed significant light on the financial underpinnings of Missouri’s unregulated gaming sector. From 2017 to 2023, players spent an estimated $32 million on Torch Electronics’ machines across 20 locations. Retailers retained approximately $11 million in shared revenue, while around 65% of the bets were returned to players as winnings. Notably, unlike regulated casinos, Torch Electronics doesn’t pay taxes on its earnings, which would otherwise support state education or other programs.
Torch Electronics, bolstered by political donations and lobbying efforts, has a strong presence in Missouri. The Missouri Gaming Commission estimates 15,000 of their machines are operational state-wide. Political contributions, particularly to groups associated with Steve Tilley, the company’s lead lobbyist and a former House Speaker, have fueled their expansion. This year alone, Torch donated nearly $600,000 to political groups, including substantial contributions to those supporting Governor Mike Kehoe.
Despite the jury’s decision, Torch Electronics plans to challenge the verdict. Their spokesperson, Gregg Keller, reiterated the company’s stance that their machines are legal under Missouri law. On the other side, Richard Finneran, TNT’s attorney, lauded the jury
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