SC group brings lawsuit against Dave & Buster’s, claiming illegal gambling
A South Carolina company has sued Dave & Buster’s, accusing the national entertainment chain of running an illegal gambling operation through its arcade-style “redemption” games, and seeking to claw back customers’ losses at three locations in the state, including Myrtle Beach, Columbia and Greenville.
The lawsuit, filed April 15 in federal court in the District of South Carolina, was brought by S.C. Citizens for Equal Enforcement of Gambling Laws, a limited liability company comprised of business owners around the state.
The complaint invokes South Carolina’s version of the “Statute of Anne,” a law dating to the early 1700s that allows a gambling loser to recover losses of $50 or more if they sue within three months — and, if they do not, allows “any other person” to sue the alleged “winner” for triple damages, with the recovery split between the plaintiff and the county where the gambling occurred.
Dave and Buster’s declined to comment on the suit.
At the heart of the case is a question that has roiled South Carolina for years: when does an amusement game cross the line into unlawful gambling?
Attorney Jim Griffin, who is representing the group, said a failure by the state legislature to pass a law legalizing redemption video games coupled with recent court decisions that’ve ruled skill-based video games illegal if the player is able to win something of value, has created a muddy legal landscape.
“This uncertain legal landscape allows SLED and other agencies to unfairly and selectively enforce these gambling laws,” Griffin said. “Through this lawsuit, SC Citizens for Equal Enforcement of Gambling Laws LLC hopes to bring clarity and equality to the video game entertainment industry in South Carolina.”
Dave & Buster’s markets its arcade floor as “The Midway,” a core part of its business, the complaint says, citing the company’s annual report. Customers buy credits — loaded onto what the chain calls a “Power Card” — and play a mix of skill-based and chance-based games. Those games award electronic “tickets,” which can be exchanged at in-store redemption counters for prizes ranging from low-cost novelty items to high-end consumer electronics, the suit says, listing items like Apple iPads, Sony PlayStation 5 consoles, Nintendo Switch systems and headphones.
The opportunity to convert play into prizes is what makes the operation gambling under South Carolina law, the plaintiff argues. It cites a recent state Court of Appeals decision, Dragon’s Ascent Video Gaming Mach. v. S.C. Law Enf’t Div., which held that gambling prohibitions apply to machines used for gambling “whether by skill or chance,” and a prior decision emphasizing that the mix of skill and chance is not determinative — what matters is whether “money or something of value” is wagered on an outcome.
The lawsuit also tries to quantify what it calls the house edge. Dave & Buster’s entertainment revenue, it says, generated a gross margin of about 91.5 percent in fiscal year 2024, meaning that for every dollar loaded onto a Power Card, the average customer receives less than nine cents in prize value, according to the suit. On that math, a customer who loads $55 “loses $50.33 on average at a single sitting,” clearing the statute’s $50 threshold.
The plaintiff is not suing on behalf of any named customer. Instead, it says Dave & Buster’s has the data needed to identify patrons who lost $50 or more “at any single time or sitting” and did not sue within three months — information the company can “readily” obtain because it tracks customers through its Power Card system.
Among other remedies, the complaint asks the court to compel Dave & Buster’s to identify how much money each customer lost at each South Carolina location during the year before the suit was filed, and to award triple damages on qualifying losses, plus costs and fees where allowed.
It also asks for a declaration that the company’s redemption games amount to illegal gambling under state law and demands a jury trial.
Dave & Buster’s, incorporated in Delaware and headquartered in Coppell, Texas, is publicly traded on the Nasdaq under the ticker “PLAY,” the lawsuit notes. The case was filed in the Florence Division because the Myrtle Beach location is within that division, according to the complaint.
The lawsuit arrives amid continued political sparring over how South Carolina should define gambling in an era of sophisticated, casino-like games that appear in family entertainment centers. The complaint points to proposed legislation introduced after the Dragon’s Ascent decision that would carve certain “predominant skill” games out of the definition of gambling; the bill passed the state House in May 2025 but has not become law.
For now, the plaintiff’s theory is blunt: If customers pay money for a shot at “winning more” in tickets that can be redeemed for valuable prizes — even at an arcade — South Carolina law treats it as gambling. And under the state’s unusual loss-recovery statute, the suit contends, Dave & Buster’s could be forced not only to refund those losses but to pay triple, with the involved counties receiving half of any recovery.
Short of a change in law, Griffin said he fully expects to prevail on the matter.
“Under Dragon’s Ascent, there’s no video game that can really be operated and used for any type of redemption. And so if our clients can’t do it, then no one else should be able to do it,” Griffin told The State.
