N.S. government seeks gambling lawsuits protection

In a bid to protect itself from potentially costly lawsuits related to video lottery terminals (VLTs) and other forms of gambling, the Nova Scotia government is seeking modifications to the province’s Gaming Control Act.

The proposed changes would provide the government, its ministers, the Atlantic Lottery Corporation, the Nova Scotia Gaming Corporation and casino operators with immunity against class-action lawsuits and liability for punitive damages.

The changes were introduced on Tuesday – they are included in legislation that implements measures in the spring budget and are retroactive to May 2, 1991, when the province introduced VLTs.

Finance Minister Karen Casey clarified that the protection does not apply in cases of alleged negligence or omission by operators.

The minister agreed the move was a “wise and prudent step” given an ongoing lawsuit involving VLT gaming in Newfoundland and Labrador that is currently being heard by the Supreme Court of Canada.

Casey said, “We need to be prepared here so that taxpayers are not on the hook for something that may come out of the legal action.”

She said the change is akin the one passed by the New Brunswick legislature in December and would likely be considered by the other partners in the Atlantic Lottery Corporation, Newfoundland and Labrador and Prince Edward Island.

Gambling is “a choice” that Nova Scotians use for entertainment. However, she agreed that misuse could lead to addiction, she added.

She told reporters, “We believe it is an individual’s choice, but we also recognize that we have a responsibility to help those who may be struggling.”

The Supreme Court case blends challenges emerging from a Newfoundland and Labrador Court of Appeal decision that enabled a class action alleging that VLTs are fundamentally deceptive, addictive and illegal under the Criminal Code.

The outcome of the action could have far-reaching implications for similar gaming across Canada – it includes as many as 30,000 people in that province who paid the Atlantic Lottery Corporation to wager on VLT games any time after April 2006.

The damages being pursued by lead plaintiffs Douglas Babstock and Fred Small are equal to the alleged unlawful gain obtained by the lottery corporation from VLT revenue. The corporation claims that the electronic games are highly regulated and decided only by chance.

As per the province, Nova Scotia currently has 2,030 off-reserve VLTs, with more than 1,200 of the machines eliminated by attrition since the Responsible Gaming Strategy went into effect in 2005 and was updated in 2011.

First Nation sites currently have 651 active VLTs.