The Shingle Springs Band of Miwok Indians in California’s gold country may have finally won the decade-long legal battle with a one-time partner that once threatened to force it to close its Red Hawk Casino.
The California 3rd District Court of Appeals last week dismissed the case by Sharp Image Gaming, and its owner Chris Anderson, filed in 2007, that accused the tribe of violating two contracts with the tribe during the 1990s, when the tribe first attempted to make a go of a casino. The tribe opened a Sprung structure casino in 1996, only to close it a year later.
A lower court six years ago ruled for Sharp and had awarded it $30 million, at which time the tribe’s attorneys described a grim scenario that it would probably have to close the $535 million casino it had been successful in starting in 2008 near Highway 50.
They wrote, “Any efforts to presently execute on the judgment would likely have catastrophic consequences for the tribe and all who depend on the casino for their livelihood.”
The tribe was saved when Governor Jerry Brown agreed to renegotiate its original compact, signed under his predecessor, in which the tribe had agreed to pay 25 percent of its slots revenue to the state. Brown agreed to give the tribe a three-year break from payments, and after that accepted 15 percent.
During its legal battle the tribe claimed that the Sharp contracts did not have the force of law because they were not endorsed by the National Indian Gaming Commission, as required by federal law.
The Appeals Court ruled in the tribe’s favor, ruling that the case should never have gone to trial. It also ruled that the contracts violated the Indian Gaming Regulatory Act (IGRA) because the NIGC did not approve them. The court also ordered Sharp to pay the tribe court costs associated with the appeal.
Tribal Chairman Nicholas Fonseca hailed the decision: “I always believed the tribe was in the right. I’m glad the tribe had the perseverance to stay the course. This is a victory for all tribes in California.”
