Santa Anita Park in California introduced new 'Racing on Demand' machines last week, only to have them seized by state authorities shortly thereafter. The park installed 26 of these machines on January 15, 2023, but the state’s Department of Justice confiscated them two days later, along with the money inside. In response, Santa Anita filed a lawsuit against the Department of Justice and Attorney General Rob Bonta in Los Angeles Superior Court, suggesting that the situation extends beyond the mere seizure of the machines.
The lawsuit claims that prior to the installation, state officials consulted with the California Horse Racing Board (CHRB) and the DOJ regarding the legality of offering bets on historical races dating back to 2024. While live bets were approved for 2024, discussions about wagering on past races lingered throughout 2025 without resolution. Santa Anita communicated its plans with the board multiple times, including two notifications in December.
The lawsuit highlights that neither the Attorney General’s office nor the CHRB challenged Santa Anita’s legal reasoning or asserted that the track lacked the authority to provide the 3X3 wager on concluded races.
The machines allowed for $1 parimutuel '3X3' bets, where users selected three trifectas, predicting the top three finishers in a race. Payouts varied based on how many combinations were correct, and the races used data from past contests outside California. The wager type is akin to historical horse racing (HHR), which is permitted in various other states.
Santa Anita reported that officials did not notify them of the impending seizure and that no warrant was served. Instead, 21 DOJ agents and two local police officers arrived on-site with a U-Haul truck to remove the machines. The park stated that documentation was provided only after the seizure, with no receipt for the cash taken.
Several local labor unions also expressed their concerns regarding the seizure. On Wednesday, four unions — the Service Employees International Union, Teamsters, State Association of Electrical Workers, and the California Pipe Trades Council — sent a joint letter to Bonta, describing the seizure as 'misguided' and 'reckless.' They raised alarms about the uncertainty this decision introduced into an already struggling industry.
Bonta’s office has yet to respond to requests for comments regarding the situation. The CHRB issued a statement acknowledging knowledge of the machines but claimed it did not authorize their installation and expressed its intent to cooperate with any investigation from the Department of Justice.
Bonta, facing reelection in 2026, has attracted scrutiny for his perceived alignment with state gaming tribes. Alongside the seizure, his office is working on a set of rule changes for state card rooms that overlap with issues previously contested by tribal entities, with a finalization expected by early April. Last year, he declared most forms of daily fantasy sports illegal in California, which is another contentious issue with the tribes. His campaign contributions from state gaming tribes exceed $300,000, and his reelection fund currently holds $7.1 million, rising from $6.7 million in October. Notably, the unions that criticized the seizure have also previously donated over $50,000 to his campaign.
California tribes have long held exclusivity over Class III gaming, including traditional casino operations and sports betting. They perceive attempts to challenge this exclusivity as increasing in recent years. Their success is evident, having defeated Proposition 27 in 2022, a statewide initiative for online sports betting that drew a historic spending battle totaling $463 million.
Santa Anita asserts that the 'Racing on Demand' technology does not constitute Class III gaming as it relies on parimutuel wagering. The track's senior vice president, Scott Daruty, stated that these machines were uniquely designed for Santa Anita and had not been utilized anywhere else.
According to a deleted post from Win Wagering Systems, the machines were engineered by AmTote International and 1/ST Racing, the latter owned by The Stronach Group, which also owns Santa Anita. AmTote is known for its partnerships with various tribal entities, including the Cabazon Band of Mission Indians and several popular casinos.
Victor Rocha, conference chair of the Indian Gaming Association, indicated that the outcome of the seizure was predictable, citing previous engagements over sweepstakes and prediction markets.
Prediction markets represent a growing challenge for California tribes. Companies like Kalshi and Polymarket, alongside various commercial bookmakers and DFS firms, have recently launched these platforms in the state. These markets often rely on federal preemption, a tactic with mixed results in legal challenges from tribes.
In November, a US District Court ruling favored Kalshi despite attempts by three tribes to prevent its operation on tribal land. A cohort of tribal lawyers, however, has successfully filed additional briefs in similar cases across the country.
Amid this regulatory landscape, the Commodity Futures Trading Commission has embraced the technology, raising concerns among tribal leaders. James Siva, chairman of the California Nations Indian Gaming Association, stated that prediction market operators exploit regulatory gaps to expand gambling beyond established laws.
