California Legislature Passes Bill to Let Tribes Sue Cardrooms

The California legislature sent a bill to Gov. Gavin Newsom’s desk Saturday that will allow tribal casino operators a one-off chance to sue the state’s 84 licensed cardrooms.

The tribes claim the card clubs offer games that violate their own exclusivity on house-banked casino games. But they have previously lacked the legal recourse to challenge the clubs. That’s because, generally speaking, state courts lack jurisdiction over tribes, which are sovereign nations. And meanwhile, federal courts prefer not to interfere with California’s internal gaming laws.

The Senate approved the Tribal Nations Access to Justice Act by a resounding 32-2 on the final day of the legislative session. The bill authorizes the tribes to seek limited declaratory and relief action to determine whether the card clubs’ games violate their rights. They cannot claim monetary damages.

California Nations Indian Gaming Association (CNIGA) Chairman James Siva described the legislation’s passage in a statement as “a new day in California history in regard to the civil rights of this state’s tribal nations.”

For over a decade, California tribes have engaged in considerable efforts to defend our exclusive gaming rights guaranteed in the California Constitution,” Siva added. “The Tribal Nations Access to Justice Act gives tribes access to justice that has been denied not only in this case, but throughout California history.”

At the heart of the matter are so-called “California games” offered by the state’s cardrooms. These are versions of popular casino table games that circumvent the ban on house banked games by taking a rake from each hand while allowing players to play in a rotating dealer position — just like in a regular poker cash game.

But the cardrooms also hire state-licensed third parties to “shill” in the dealer spot because players don’t always want to act as the dealer. The tribes argue that these companies, known as TPPPs, are a de facto “bank.”

Cardroom advocacy group the (CGA) has said the bill could cost the industry around 32,000 jobs. That’s because an unfavorable court ruling stemming from the bill would force many of the clubs to downsize or shut down.

“This bill will only throw government budgets into uncertainty and make a mockery of our judicial system,” according to an August 20 statement by the CGA editorial board. “Weaponizing the legislative process so that one special interest group can try to drive out perceived competition is silly on its face.”