The much-anticipated lawsuit between the California tribes and stat card rooms is officially underway.
Tribes in the state filed the suit in Sacramento Superior Court on Jan. 1, the first day it was legally allowed to do so. The suit comes after Gov. Gavin Newsom signed SB 549 into law. The new law allows tribes to litigate the issue of house-banked games in court. Previously tribes lacked standing to bring the suit as sovereign nations, but the law creates an exemption to file suit so long as the tribes seek no financial damages.
In the complaint filed Wednesday, the tribes laid out its argument as to why these house-banked games violate California law.
Tribes say player-banked card games skirt existing gaming law
Card rooms are allowed to offer player-banked card games and peer-to-peer games such as poker. Over the years, most card rooms in the state began to offer games like Blackjack and Baccarat with players at the table taking turns being the banker. That evolved into the development of third-party proposition players (TPPs). These contractors sat at these table games and volunteered to be the banker, which comes with a certain amount of volatility given they are playing against every hand at the table.
The lawsuit contends that card rooms and TPPs developed rules and workarounds so the TPPs served as the de facto bank for all hands played in these games. The rooms technically offer opportunities for other players to assume the role of banker every two hands. Additionally, the game takes short “breaks” so the TPPs do not remain the banker for an uninterrupted period of time.
These TPPs go beyond simply backing the games, per the lawsuit. In addition to paying a fee to serve as TPPs, the companies also provide surveillance equipment and help fund advertising for the card rooms.
“By using well-funded TPPs to ensure liquidity for games and by refusing and failing to comply with legal requirements that the banking position must rotate away from the seat held by the TPPs, card rooms have created gaming experiences that are indistinguishable from banked games in Nevada or New Jersey casinos,” the complaint reads.
The tribes contend that state low gives the exclusive right to offer house-banked card games to the tribes and the card rooms are running afoul of that monopoly.
Dozens of California card rooms named as defendants
In a previous court case, Oliver v. Count of L.A. (1998), the courts ruled that merely creating the potential for the bank to rotate as part of the rules was insufficient to count as a player-banked game.
Dozens of card rooms have been named as defendants in the case. There are seven tribes serving as plaintiffs.
The tribes would like the courts to declare the current blackjack, Baccarat and any other games in which the option to be banker is only offered, not mandated, be declared in violation of both the state constitution and the California Penal Code.
