Federal Lawsuit Targets Dave & Buster’s in South Carolina Over Alleged Illegal Gambling and Asset Recovery

South Carolina group sues Dave & Buster's under the "Statute of Anne," seeking triple damages and alleging the chain's arcade prize system is illegal gambling.

By: AXL Media

Published: Apr 23, 2026, 9:01 AM EDT

Source: Information for this report was sourced from The State

Arcade Redemptions Challenged as Unlawful Wagering

The legal definition of family entertainment has come under intense scrutiny in South Carolina following a lawsuit filed by S.C. Citizens for Equal Enforcement of Gambling Laws LLC. The complaint, lodged in federal court, argues that the core business model of Dave & Buster’s—specifically its "Midway" arcade floor—operates as an illegal gambling enterprise. The plaintiffs contend that because customers pay for credits to play games of chance or skill in hopes of winning electronic tickets redeemable for high-value prizes, the activity meets the state's criteria for gambling. This challenge hinges on the assertion that any game where "something of value" is wagered on an outcome is prohibited under current South Carolina statutes.

Reviving the Historic Statute of Anne

A central and unusual component of the litigation is the invocation of the "Statute of Anne," a law dating back to the early 1700s that remains part of South Carolina's legal code. This statute provides a unique mechanism for recovering gambling losses: it allows a person who loses $50 or more in a single sitting to sue for a refund within three months. If the loser fails to act within that timeframe, the law permits any other person or entity to sue the "winner" for triple damages. The proceeds from such a recovery are then split between the plaintiff and the county where the alleged gambling occurred, potentially creating a massive financial liability for the entertainment chain.

The Impact of Recent Judicial Precedents

The lawsuit arrives in a "muddy legal landscape" shaped by recent decisions from the South Carolina Court of Appeals. Specifically, the case of Dragon’s Ascent Video Gaming Mach. v. SLED established that gambling prohibitions apply to machines regardless of whether the outcome is determined by skill or chance. Attorney Jim Griffin, representing the citizens' group, argues that since the state legislature has failed to pass laws specifically legalizing redemption-based video games, current enforcement is selective and unfair. The plaintiffs seek to use this case to force a definitive clarification of the law, arguing that if small business owners are restricted from operating similar machines, national chains must be held to the same standard.