Skill-based slot-machine company wins licensing recommendation

The executive of a Las Vegas company specializing in skill-based video game slot machines was recommended for a one-year license to continue operating in Nevada by the Gaming Control Board.

Board members on Wednesday spent more than two hours questioning GameCo CEO Blaine Graboyes (his legal last name on the state application is Goldman) to determine his suitability to hold a license.

Licensing as a manager and key executive with the one-year restriction will be considered by the Nevada Gaming Commission on Feb. 18 and, if approved, Graboyes would have to return for reconsideration in a year.

Graboyes was first licensed in February 2019 with a two-year restriction after board members questioned his treatment of tax liabilities years ago and his failure to report lawsuits and liens resulting from those liabilities during his licensing suitability investigation.

Board members were satisfied that Graboyes properly handled the tax, lawsuit and liens matters, but a new issue surfaced. He was accused in a social media post of taking intellectual property from Toledo, Ohio-based Beyond Gaming for GameCo when Graboyes worked with Beyond as a consultant.

In a statement earlier in the meeting, Beyond Vice President Justin Yamek accused Graboyes of driving Beyond into bankruptcy and taking the company’s software assets. Graboyes has denied the allegations. No lawsuits have been filed.

In the two years GameCo has been licensed in Nevada, the company has developed video game titles that encourage young players to move to casino versions of the same game to boost revenue.

Among GameCo’s titles are Call of Duty, Nothin’ But Net, Steve Aoki’s Neon Dream and Terminator 2. All have a skill-based component to them that give players an opportunity to win more money if they play the game strategically.

Graboyes said his next project will be to establish an esportsbook in Colorado that would enable gamblers to wager on the outcomes of video game tournaments and matches. He said development of the project has been slowed because of the rush to establish traditional sportsbooks first in Colorado, which only recently approved and started up legalized sports betting.

“I’m excited to see this concept of video game gambling on the casino floor,” Control Board Chairman Brin Gibson said during the testimony.

But board members decided to delve into Yamek’s allegations, presented in a two-page statement during the board’s public comment period.

“Blaine was a good CEO at first, but something changed,” the statement said. “He offered to buy our prototypes and intellectual property we developed as a team to start a new company called GameCo that would build the (video game gambling machines). The offer was very bad for us.”

The Control Board has no means to call Yamek forward to testify, but instead questioned Graboyes about the allegations.

Graboyes called the allegations “wholly false and untrue.”

Board members considered recommending GameCo licensing for six months or two years, but ultimately decided on the one-year restriction.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.