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Cleveland Internet Cafes Were Illegal, According to Appellate Court

Written by on Wednesday, March 27, 2013 at 6:49pm

Three internet cafes in Cleveland have been ruled as illegal businesses that operated too similarly to casinos, by the state appellate court.

The Ohio 8th District Court of Appeals court upheld gambling convictions obtained last year against the owner of Internet Depot, Randall Thorne, and Michael Hawk, owner of Blackhawk I and II. Both owners received probation.

A panel of three judges rejected arguments that the cafes actually sold Internet time and were instead offering computerized, slot-like games as a marketing tool. The appellants’ attempts to legitimize the café operations as legal business operations resulted in a fail.

The businesses operated like casinos, advertised themselves as casino-like businesses, and profited off of casino-like operations.

The Ohio House has since then approved a proposal that would prohibit cafes from offering cash jackpots and limit the values of any prizes to $10. Industry representatives are thinking that this may run Internet cafes out of business.

The three cafes specific to this appellate case all used a communications software company from New Jersey called VS2 Worldwide Communications to run their games, which now has files charged against it for racketeering, money laundering, and gambling by Cuyahoga County.

A lawsuit seeking to permanently bar the cease-and-desist order is pending after all the cafes in Cuyahoga County were ordered to be shut down.

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