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HIGH POINT — For now, state agents can't shut down businesses featuring video slot machines connected to certain phone- and Internet-marketing systems, a judge ruled Friday.

However, the two companies that provide the software can't expand in North Carolina while their lawsuit against the state makes its way through his court, ordered Guilford County Superior Court Judge John O. Craig III.

And businesses that state agents closed down for using Hest Technologies or International Internet Technologies software may reopen, the judge ruled. He also said that a handful that were prevented from opening could now do so, but he cautioned the companies to limit those numbers.

Craig granted a preliminary injunction after hearing five hours of evidence and arguments — and seeing live demonstrations of the systems.

The machines, which appear to allow players to play a variety of slot machine-style games, are frequently found in bars and convenience stores. Over the past year, agents with the state Alcohol Law Enforcement Division have charged operators in Guilford, Rockingham, Alamance and Davidson counties with breaking the state's anti-gambling laws.

ALE is the law enforcement arm responsible for enforcing the state's anti-gambling laws, along with those that concern liquor and tobacco sales and sales of lottery tickets.

The two companies asked the courts March 4 for a temporary restraining order, which prohibited ALE agents from continuing raids and arrests.

Attorneys for the two companies argued Friday that their systems are legal sweepstakes. Customers get free entries when they buy phone or Internet time. They can "reveal" what they have won by asking the cashier to tell them their prize. Or they can play computer games such as Keno or Blazing 7s.

The computer games don't decide what a customer wins, which is different from the video slot machines the state outlawed, they argued.

"The bottom line," attorney Rick Coughlin said, "is this is not a game of chance. This is a way to simulate a game of chance to reveal their prize."

But Hal Askins, special deputy attorney general, and Assistant Attorney General David J. Adinolfi II argued that the machines and computers break North Carolina law. They're being used as slot machines to dispense a prize in a game of chance, Askins and Adinolfi said.

"You can't tie a valid sweepstakes to an illegal activity," Askins said.

Craig struggled to see the state's side of the argument. How, he asked, is it any different from his children going online and plugging in codes from their Pepsi or Coca-Cola caps to see if they've won a prize?

Craig wondered if the legality of such machines should even be decided by the courts.

"I think it ultimately becomes a legislative issue," he said.

The hearing drew interest from district attorneys, law enforcement agents and attorneys who came from across the state, including Union, Wake and Brunswick counties.

Contact Jennifer Fernandez at 373-7064 or jennifer.fernandez@news-record.com