California’s gaming tribes are in a battle to prevent the state’s cardrooms from continuing to offer forms of card games that the tribes insist are illegal for them under the state tribal gaming compacts.
For seven years the tribes complained, with increasingly insistent threats, that the Bureau of Gambling Control (BGC) was not enforcing exclusivity laws. Some cardrooms consider this an existential threat that could force some of them to shutter their doors.
Meanwhile last week the BGC began holding seven planned statewide meetings on cardroom games before issuing a previously announced set of rules that will crack down on the cardrooms—but not nearly hard enough, according to the tribes.
The bureau proposes to enforce the rules on blackjack style games and change the rules pertaining to rotating player-dealer games, games which account for 70 percent of games played at the cardrooms. It also announced that it would “rescind game rules approvals for games too similar to 21/blackjack that are prohibited by state law.”
At this point the tribe considers this all talk.
Employees of cardrooms have showed up in large numbers at these meetings and shared stories and concerns about their jobs.
With 66 cardrooms operating in the Golden State compared to 55 tribal casinos, the two sides would seem to be evenly matched. However, in spite of the fact that most tribal casinos are in rural areas and most cardrooms are in cities, the big money influence advantage lies squarely with the tribes.
One political advantage cardrooms possess is that they employ thousands of Californians and, if their very existence is threatened, that makes it hard for tribal casinos to counter.
However, tribes insist they have the law on their side. Steve Stallings, chairman of California Nations Indian Gaming Association, which represents most tribal casinos, declared in a speech that the state “is plagued with a commercial gaming industry that has run amok.” He added, “The illegal gaming conducted at cardrooms is a direct violation of California’s prohibition of banked and percentage card games off Indian lands.”
Tribes are not about to surrender the exclusivity to certain types of games that the compacts have guaranteed them since 2000, he said. In that year the state’s voters amended the constitution to “limit slot machines as well as banked and percentage card games to Indian land.”
Several months ago tribes began filing lawsuits against individual cardrooms, claiming they were violating the law. In January three tribes based in Southern California, Yocha Dehe Wintun Nation, Viejas and Sycuan bands of Kumeyaay Indians, filed suit against Los Angeles area cardrooms, claiming they offer house-banked games, which only tribes can offer. Their lawsuits were similar to those filed two months earlier by the Rincon Band of Luiseño Indians and the Santa Ynez Band of Chumash Mission Indians, which challenged the “California games” offered at same cardrooms. They not only named the cardrooms but the governor of California, who was Jerry Brown as of December, and is now Gavin Newsom.
The cardrooms say that, by the letter of the law, their games are not house banked. Federal regulations define house-banked as “any game of chance that is played with the house as a participant in the game, where the house takes on all players, collects from all losers, and pays all winners, and the house can win.” The cardrooms pay third parties to act as banker and the casinos only take a rake levied on each game, not any of the winnings.
The card clubs contract with third-party providers (aka Proposition Player Services or TPPPS) to ensure that the betting rules are followed at each table and that payout winnings and collections are correct.
Representing many of the card clubs is the California Gaming Association. Its president, Kyle Kirkland, president of the Club One Casino in Fresno warns that the tribes are using their enormous political clout in Sacramento to try to shut down competition.
In a brief filed against the latest tribal lawsuits the CGA claimed there has been “ongoing effort by certain tribal casinos to bully regulators and elected officials into taking unwarranted action against … cardrooms.”
He told Casino.org: “This is a real concern. A few tribal casinos have put political pressure on the Attorney General Xavier Becerra and initiated suits against Southern California cardrooms and the governor.” He adds that because the games the cardrooms offer tend to favor players more than house-banked versions that the tribes particularly want to shut them down.
