California Tribes Won’t Negotiate With “Terrorists”

California tribes don’t feel they’re getting their fair shake — from the state regulators and the media. When it comes to the latter, they’ve taken matters into their own hands.

In what’s becoming a regular occurrence, a few prominent figures in the tribal community have launched a webinar series called New Normal. The series usually features three big wigs:

• California Nations Indian Gaming Association (CNIGA) Chairman James Silva
• Indian Gaming Association Conference Chairman Victor Rocha
• Indian Gaming Association Executive Director Jason Giles

The topic of the series? Addressing California’s “grey market” of gambling — betting going on that the tribes feel is violating its compact with the state that affords them the exclusive right to offer gambling in the Golden State. Anyone is welcome to attend the virtual webinars, which have become gold mines of news. The latest webinar felt more like a warning shot as we’ll explain in this article.

Tribes Want To See What Their Options Are

Joining the webinar for this episode was another prominent name in Jonodev Chaudhuri, principal at Chaudhuri Law and former chair of the National Indian Gaming Commission (NIGC). He was a careful selection to join the show because the NIGC has some power in their hands. It’s on the NIGC to see whether the Indian Gaming Regulatory Act is being violated.

“In many ways, the NIGC has to be somewhat reactive,” Chaudhuri said. “If there is gaming occurring on tribal lands that isn’t run by the tribe, that is a violation of IGRA.”

As a refresher, the IGRA is a federal law — not just California law. It was passed in 1988 to regulate betting in Native American lands countrywide. Betting in California used this framework to pass Proposition 1A in 2000 which gave federally-recognized tribes in the state (which there are many of) the exclusive right to offer gambling within state borders.

Chaudhuri outlined what the tribes can do if they feel their gambling rights are being infringed. He says penalties for illegal betting operations could entail fines and cease-and-desist orders, saying, “I did letters like that when I was [at the NIGC].” Chaudhuri went on to say the NIGC acts more as liaisons between tribes and the government so their abilities aren’t all-empowering by any means.

The tribes want to see their options because they have a new source of frustration — sweepstakes. These operators are proliferating not just the California marketplace, but the whole country. Sweepstakes are especially popular in states without legalized betting as is the case in California. So what are the tribes going to do? Negotiating is off the table, as we’ll explain in the next section.

Tribes Call Sweepstakes Operators “Terrorists”

The above headline is not hyperbole in the slightest. It’s a direct quote from the webinar. Here’s the full quote:

“This is not a dialogue, this is not a discussion — we don’t negotiate with terrorists,” Rocha said.

Translation: the tribes don’t want to “meet in the middle” with sweepstakes. They want them completely gone and probably fast when you’re throwing around words like terrorists. Yes, the word is a little overboard, but it just goes to show you the level of frustration tribes are feeling against sweepstakes-like companies.

This is getting worse by the week,” said Giles quipped on the call:

Ironically enough, Giles is on point. You see, the Legendz Social Casino & Sportsbook just launched in 43 states this month, including California. Casinos like Legendz offer play money games and the chance to win cash prizes with “sweeps” coins — a virtual currency that can be exchanged for the real thing. Legendz is the latest entrant in the market, but casinos like Stake have made a killing off this roundabout gambling method.

“If there is gaming occurring on tribal lands that isn’t run by the tribe, that is a violation of IGRA,” Chaudhuri said. “How that applies to sweepstakes is a conversation about what is actually going on.”

What Will The Tribes Do?

Here’s the tricky situation with California-based tribes: there’s a bunch of them. It isn’t like Florida betting, which is controlled by one tribe in the Seminoles. There are dozens in California and if they’re going to take action against the sweepstakes companies — say sue them — then they need to be aligned. That’s not necessarily easy with so many stakeholders.

Chaudhuri said as much as so. He brought up how there “is not one uniform compact”, but rather dozens of them in California. It’s on each tribe to take that up with the state.

The tribes are in the process of suing card clubs that operate in the state. They haven’t brought that lawsuit forward yet, but lawmakers gave them the right to pursue legal action against clubs that offer card-playing gambling. But again, the holdup here is getting all the tribes to come to an agreement on the course of action.

The only other option? If the entire state outlaws the type of gaming, which we’re sure is what the tribes want. As it stands, seven states have done just that — Ohio, Nebraska, Montana, North Dakota, Michigan, Idaho, and Washington. Will California be pressured by the tribes to be No. 8? Time will tell.