A downsized, legal video gaming industry is rapidly re-emerging in South Carolina, leaving critics worried that the obituary on illegal video gambling was premature.

Regulators say illegal cash payouts are not back in a big way. And gone are the playing cards of the old video poker machines.

But, since September, state police have stepped up their seizures of machines, adding to the 1,300 now sitting in warehouses that judges have declared illegal since the death of video poker in July 2000.

And pro-gaming forces are getting more types of new-generation machines declared legal - at least temporarily - by winning an increasing number of fights in court.

Opponents fear a return to widespread, legalized gambling. That, they say, could drive the state back a decade, to when video poker interests developed into $3 billion-a-year bullies strong enough to help sway elections.

"They're waiting for us to turn our backs," anti-poker lawyer Richard Gergel said of the renewed push by the industry.

"The gambling industry is like a collection of cockroaches after an atom bomb," he said. "They're always back trying to get into business."

People in the gaming trade say they are trying to build a thriving industry by developing a legal game that will attract players and draw them away from the new state-sanctioned lottery.

They say they just want legal machines that bring in customers with cash to spend.

A review of court cases and interviews with more than a dozen pro- and anti-industry forces found an increasingly strong industry fueled by:

Guerrilla-style court strategies by machine owners to exploit local police and judges unfamiliar with complex gaming laws.

Actions in court by elected prosecutors - including the state attorney general - that allowed games to remain legal, at least temporarily.

Courtroom wins in Allendale and Berkeley counties that bar police from seizing two different games, allowing the spread of those machines. State regulators are appealing both.

Rulings from local magistrates and two state Circuit Court judges that groups of machines are legal. S.C. law says machines must be ruled on one at a time.

A Goose Creek-based company's introduction of what it says is a tamper-resistant computer chip for its latest $3,500 machine, which it hopes to sell nationwide. The company argues that the chip helps make all of its Chess Challenge II machines identical and allows a judge to declare all Chess Challenge IIs legal at once.

Pushing the legal envelope

The State Law Enforcement Division has stepped up its raids for illegal machines in the past three months.

Since July 2000, agents have seized 50 different games in more than half of the state's 46 counties.

In a series of raids this fall, SLED agents seized more than 400 machines they say are illegal.

Regulators say they are standing guard against sophisticated machines that trump a player's skill and decide a game's outcome by mathematical chance. That makes the machines illegal.

"Everybody's trying to find the machine, a legal game," said Stacy Drakeford, SLED's chief gaming enforcer. "We've been fighting it for three years."

Machine owners say players win merchandise or free plays - not cash - on games with folksy names such as Fruit Holder, Gone Fishin', Jungle King or Truckstop.

The cousins of poker machines remain popular in convenience stores, bars, and private and public clubs.

State records show there have been 14,163 licenses issued for amusement games.

But the records don't distinguish between games with video screens and those that are simply electronic, such as pinball.

When video poker was king, 37,000 machines dotted the state.

An S.C. Supreme Court ruling outlawed video poker after the largely unregulated industry introduced gambling casinos and bare-knuckle politics that raised enough money to help topple Gov. David Beasley, who vowed to kill the industry.

Though today's machines look different from video poker, many familiar poker bosses are involved in 2003's gaming.

Warren Holliday in the Lowcountry, Jimmy McDonald from the Grand Strand and Fred Collins of the Upstate have video machine licenses. All declined interviews.

Testing the courts

The industry once produced revenue equal to almost half the state's annual budget.

Today, the state takes in $2 million yearly in video game fees - about 3 percent of the $60 million a year that taxes on video poker raised.

Two huge SLED warehouses full of machines seized since mid-2000 show that wagering on electronic gaming remains popular. But no one knows how much wagering is going on.

SLED records show undercover agents have made 107 cases charging illegal payouts since video poker was outlawed, Drakeford said.

Yet SLED has gotten 824 gambling complaints it could not prove, Drakeford said.

Gambling critics, including Sen. Wes Hayes, R-York, say wherever there is a machine, there is gambling.

Machines are ruled illegal because their computers are rigged so that a player's skill has little to do with winning.

"The only thing different [from video poker] is the icons change," Drakeford said. "It's still the same thing."