California Tribes Dominate Gambling, Cardrooms Fight Back in Court

California’s Native American tribes have transformed their historical struggle into a position of significant power, particularly within the gaming industry. After centuries of marginalization, the tribes capitalized on a pivotal 1987 Supreme Court decision that recognized their right to offer gaming, paving the way for a thriving casino industry.

Spanish explorer Juan Cabrillo’s arrival in San Diego Bay in 1542 marked the beginning of a difficult era for California’s tribal communities. Regarded by early settlers as less than human, they faced systemic mistreatment that persisted long after California achieved statehood in 1850. As historian Kevin Starr noted, “The Indian was not kept in formal slavery, but he was exterminated at the wish and the expense of the Legislature.”

Confined to reservations, these communities endured poverty largely unnoticed by state authorities until the late 20th century. The Supreme Court’s decision, however, ignited a transformation, allowing tribes to develop 76 casinos statewide, including luxurious resorts comparable to those in Las Vegas. They leveraged their newfound economic power to secure a legal monopoly on gambling in California, a status reinforced by voter-approved measures.

The tribes’ competitive edge has not gone unchallenged. A longstanding conflict with local poker parlors centers on what games the cardrooms are permitted to offer. While cardrooms expanded their offerings beyond poker to include games like blackjack, tribes argued this violated their exclusive rights. Legal attempts to halt the cardrooms’ activities were unsuccessful, prompting the tribes to pursue legislative action.

In 2024, the California Legislature passed a bill granting tribes the ability to sue cardrooms for allegedly illegal game offerings, a measure Governor Gavin Newsom endorsed. This legislative victory set the stage for Attorney General Rob Bonta to propose comprehensive regulations that effectively ban certain games in cardrooms. These regulations, finalized last month, are set to take effect in April, representing a severe challenge to cardrooms and the municipalities relying on their tax revenues.

In response, the cardrooms have initiated legal action against the new regulations. “Attorney General Bonta’s regulations threaten to eliminate more than half of California’s cardroom jobs and wipe out a critical source of revenue for dozens of cities,” argued Kyle Kirkland, president of the California Gaming Association. He added, “These games have operated legally for decades under multiple attorneys general, yet one public official is now moving to shut them down without identifying a single public safety concern or addressing the 1,764 public comments about these regulations.”

The economic disparity between the two gaming entities is stark. According to an analysis from Bonta’s office, Indian casinos generated $12.1 billion in gambling revenue in 2023, dwarfing the $1.4 billion accrued by cardrooms. This David vs. Goliath scenario underscores the complex dynamics of power, where tribes, once the underdogs, now wield significant influence over a smaller competitor.