Lawsuit seeks class-action status for Missourians out cash on unregulated slot machines
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JEFFERSON CITY — A new lawsuit is using state consumer protection statutes and a federal law used to prosecute organized crime to go after Missouri’s most well-known purveyor of unregulated video slot machines and the convenience stores that host them.
The lawsuit names Wildwood resident Steven Miltenberger and his firm, Torch Electronics, in a multi-pronged lawsuit that includes photos of children using the video slot machines and accusations that Miltenberger is running an illegal gambling conspiracy with convenience store owners.
Several Missouri residents who say they lost money playing the games that have proliferated in gas stations and convenience stores are seeking class action status on behalf of players who have lost money on the machines across the state.
Attorney Joe Jacobson of Clayton firm Jacobson Press, who is representing the seven plaintiffs along with Christopher Miller of Amundsen Davis, said some of his clients struggle with gambling addictions. He added his clients have observed children as young as “10 years old” gambling on the machines.
“You can’t avoid these illegal slot machines practically anywhere you go,” Jacobson said. “If you’re a person who’s got a gambling problem, it’s a constant battle, it’s one they lose a lot. I think that’s part of the reason why we have laws that restrict gambling to casinos that are licensed and have measures in place to protect the public. Not perfect measures, but a whole lot better than measures that don’t exist.”
It’s the latest approach opponents are trying against the devices after years of failed attempts by county prosecutors and the Missouri Highway Patrol to apply Missouri’s gambling laws to the now-ubiquitous machines.
Several states are dealing with unregulated devices similar to slot machines but which operators such as Torch claim don’t fall within state gambling definitions. Torch says its machines let players know if they will win on their next spin, thus falling outside the definition. But a player must still play that spin in order to unlock a new chance at winning.
Meanwhile, the company and Miltenberger employ some of the state’s most powerful lobbyists and operatives and shower campaign cash on state politicians, who have failed to take action on the games for years.
The suit also names as a defendant Warrenton Oil, the operator of Fast Lane brand convenience stores that host thousands of Torch terminals.
Other defendants named in the lawsuit are brothers Mohammed Almuttan and Rami Almuttan, along with their company. The Almuttans, who own several convenience stores in north St. Louis and north St. Louis County, were sentenced in October to four years in prison as part of a federal investigation that charged them with trafficking synthetic drugs and cigarettes.
Mohammed Almuttan gained notoriety as the federal informant who cooperated with the government after his 2017 indictment in a wide-ranging corruption sting. His cooperation helped convict longtime St. Louis Board of Aldermen President Lewis Reed and two other aldermen who accepted cash bribes for local tax breaks.
Miltenberger wrote a letter in support of Rami Almuttan before his sentencing that said his family had known Rami Almuttan for 20 years and he had been “one of Torch Electronics’ first clients.”
The lawsuit uses the Racketeer Influenced and Corrupt Organizations Act, or RICO, a federal statute that has been used by prosecutors to go after organized crime syndicates. The federal statute includes a civil provision that allows private entities to sue for damages.
In addition, the suit cites the Missouri Merchandising Practice Act and accuses the companies of misleading consumers. Specifically, it cites the mandated 80% payouts of regulated slot machines and alleges Torch’s machines pay out less while unsuspecting consumers assume a similar chance of winning as in a casino slot machine.
Finally, the lawsuit cites an old Missouri law that allows people who lost money gambling to sue to recover it and seeks to create a class of Missouri consumers who have lost money on Torch’s games. Other laws carve out casinos from the statute, but Torch’s games aren’t carved out from that statute, Jacobson said.
The suit was filed in federal court for the Western District of Missouri, which includes Jefferson City. That makes it one of the first federal lawsuits against Torch and Miltenberger.
“People tell me the guy (Miltenberger) is well-connected in the state of Missouri government, so it just seemed prudent to bring the action in a federal court,” Jacobson said.
Political consultant Gregg Keller, who works as a spokesman for Torch, said the company is reviewing the lawsuit but doesn’t comment on pending litigation.
A representative from Warrenton Oil declined to comment. An attorney for Mohammad Almuttan didn’t immediately respond to a request for comment.
