Misleading and deceptive conduct – a feature of poker machines?

Posted on Apr 26, 2018 by Matthew Wicks   |   Categories: Litigation & Dispute Resolution

The Federal Court of Australia has recently handed down its decision in a case where a former gambling addict commenced proceedings against Melbourne’s Crown Casino and poker machine manufacturer Aristocrat, claiming that the poker machine “Dolphin Treasure” was in breach of section 18 of the Australian Consumer Law which prevents conduct that is misleading or deceptive.

Dolphin Treasure is a computerised poker machine consisting of 5 spinning reels where a player wins by matching symbols on each of the reels. On each of the first 4 reels there were 30 stopping positions and on the fifth reel there were 44 stopping positions. There were 13 symbols that were scattered amongst the reels and these symbols were not evenly distributed. The stopping positions were selected by a random number generator on the machine.

The applicant claimed that this particular poker machine made three misrepresentations which a “hypothetical person” (as opposed to the applicant herself) would find misleading or deceptive. Those misrepresentations were:

1. That the five reels were of equal size with the same number of symbols;

2. That the symbols would be evenly distributed across the five reels; and

3. That the stated “Total Theoretical Return to Player” percentage displayed on the machine (required by Victorian Laws to be at least 87% and displayed to players) represented to players that the player will retain at least 87% of the money wagered by the player in any one session.

Crown Casino and Aristocrat denied these representations were made.

The evidence lead by the applicant in the case involved video footage of the machine showing that the reels appeared to spin at the same rate and that when the reels stopped, three symbols would be visible for each reel and each symbol would always be different.

The hearing took an odd turn when Justice Mortimer and representatives of the parties spent an afternoon at Crown Casino placing various bets on the Dolphin Treasure machine (with money provided by and returned to Crown Casino) to determine how the hypothetical player would interpret the features of Dolphin Treasure.

Her Honour eventually dismissed the applicant’s case, ruling that neither of the first two abovementioned representations were made as a hypothetical player was unlikely to turn their mind to these matters. In regards to the third representation, Her Honour noted that the representation had been made but it was not misleading or deceptive, rather that it may engender “confusion and wonderment”.

Although the Court found in favour of the defendants, it is not an unimportant decision in the protection of consumer rights. Apart from highlighting the deception inherent in the operation and set up of individual poker machines, the Court has not closed the door on similar cases in the future. The Court’s ruling was largely based on the fact that there was no evidence relating to a hypothetical person forming the impressions and expectations from the above representations. No evidence was led regarding a particular individual forming such impressions and expectations and it may be that we see a similar case in the future examining a particular individual’s experience on a poker machine.