Deputy Editor
A California judge has issued a tentative ruling indicating that she plans to dismiss tribes’ lawsuit against the state’s cardrooms over player-banked games. The tribes say certain games infringe upon their exclusivity over casino gambling in the state due to the use of third-party “prop” players who take on the role of the house.
Tribes typically can’t sue in state court due to their sovereign status. California lawmakers created a one-time exception to that last year to allow tribes to litigate this particular issue. However, Sacramento County Superior Court Judge Lauri Damrell sees no way for the case to proceed because the Indian Gaming Regulatory Act (IGRA) makes it a federal matter.
That’s a problem for the tribes, as they have already tried their luck in federal court without success.
If it stands, the ruling will pave the way for business to continue as usual for the cardrooms. However, it isn’t final yet. The tentative designation means the tribes can attempt to change Judge Damrell’s mind during a hearing set for Oct. 10. Failing that, they can appeal.
Still, California cardrooms look likely to stave off this blow to their business model. Poker wouldn’t be directly affected by any ruling. However, some rooms could be forced to shut down due to lack of profitability if they lost their ability to offer other types of games.
Judge Points To Federal Regulatory Act As Precedent
Judge Damrell leaned on IGRA in granting the defendant cardrooms’ motion to dismiss. The IGRA establishes a federal framework governing tribal gaming, leaving no role for the states outside of establishing compacts.
The tribes argued that this is a state matter because the gaming in question takes place on state land and in accordance with state law. However, the lawsuit concerns tribal exclusivity, which is only guaranteed by their compact, signed under IGRA.
Such compacts exist in California, Florida, and many other states with tribal gaming.
Last year, California legislators passed Senate Bill 549 (SB 549), the Tribal Access to Justice Act, which enabled the tribes to file the suit. However, Judge Damrell wrote that permission “does not, in itself, resolve the distinct and threshold question of preemption,” i.e. whether a state court can rule on a case that includes this element of federal law. As such, she sided with the defendants’ motion to dismiss the case on jurisdictional grounds.
“As the cardroom defendants point out, SB 549 provides tribes with a breach of contract remedy that could have been negotiated in the tribal-state compacting process, but was not,” she wrote.
Battle Over ‘Player-Banked’ Games Continues
Since they aren’t allowed to offer house-banked games, cardrooms have used a workaround for years by hiring so-called “third-party proposition players” who act as the bank. They contend the practice is legal, while the tribes contend that it’s illegally infringing upon their exclusive rights in California.
Poker players may be familiar with props, hired by the house to fill seats and keep certain games running. Poker prop players generally play with their own bankrolls but earn a wage from the casino in exchange for helping keep the games running and the rake flowing.
Third-party props have enabled the California cardrooms to offer games like blackjack and baccarat by taking on the dealer role when regular players are unwilling to. Judge Damrell’s ruling is the latest setback in the tribes’ ongoing efforts to put a stop to the practice.
Image credit: George Hodan (license)
