Two California Tribal Casinos Trying To Join Forces To Move Stalled Compact Negotiations

Written By Derek Helling on July 19, 2022 - Last Updated on July 26, 2022
Crucial Juncture In Lawsuit From California Tribal Casinos

The beauty of proposed contract terms is in the eye of the beholder. For years, two operators of US casinos have found the state’s overtures for new gaming compacts quite ugly, and that’s led to multiple California tribal casinos lawsuits.

The plaintiffs have asked the court to allow them to combine their complaints into a single case, to which California objects. The main issue at hand, however, is really about leverage for each party over the other.

Years of impasse lead to California tribal casino lawsuits

This litigation began on June 30, 2021, but the circumstances involved stretch back much further. According to the complaint of the Berry Creek Rancheria Of Maidu Indians of California, the renegotiation of their gaming compact with California began in February 2018.

Those negotiations have stalled, as the Berry Creek Rancheria alleges, over “bad faith” tactics by the state. They filed their complaint against the state on December 12, 2021. The Berry Creek Rancheria operates the Gold Country Casino Resort near Oroville.

Their complaint resembles the earlier lawsuit, which the Pauma Band of Mission Indians filed on June 30 of last year. That complaint also alleges bad faith negotiations by the state but only stretches back two years instead of four.

The Pauma Band operates Casino Pauma close to Pauma Valley. The two California casinos are over 500 miles away from each other. With similar allegations and defendants, though, the two plaintiffs made a motion to the court to consolidate their cases on June 27, 2022.

Last week, the state filed its response to that motion. The argument against consolidation is simple.

California’s interest in these cases

In its rebuttal of the motion to consolidate, California argued that as the two tribal groups have separate gaming compacts, the state can’t resolve the plaintiffs’ allegations against them unilaterally. The state does agree that the complaints are similar, though.

In their respective complaints, the Berry Creek Rancheria and Pauma Band both allege that California is refusing to budge off desired compact terms they find unacceptable. Examples include:

  • Imposing California’s minimum wage
  • Requiring the tribes to enter new agreements with local municipalities for successive expansion projects
  • Opening up tribal regulation of casinos to greater influence by California

As the complaints state, California was successful in working these and other terms into recent gaming compact renewals. Thus, it seems California could be trying to standardize its gaming compacts. That especially seems to apply in terms of labor regulations.

These two groups insist that it is an attack on their sovereignty. However, there is some “pot pointing out the blackness of the kettle” in this litigation.

Why consolidation favors the California tribes

The tribes allege in their complaints that California is giving them no concessions amidst insisting on these new terms. An example from both lawsuits is enforceable exclusivity over gaming in their immediate areas.

Essentially, that would mean the tribal casinos could sue card rooms in their vicinities. An enhanced ability to do just that for all tribal casinos inside of California happens to be part of Prop 26 that Californians will vote on this November, by the way.

If California is unwilling to grant such exclusivity terms to either tribe separately, their combined interests might provide more leverage. Increased leverage is what the plaintiffs would gain from consolidation.

Should the court deny the motion, each plaintiff’s hope would then be the court determining California is being unnecessarily obstinate. At the same time, it’s possible there is some stubbornness on the plaintiffs’ part as well.

Without exhibits of internal correspondence, it’s difficult to ascertain whether the tribes have refused any overtures to compromise. Both individual lawsuits ask the court to force the state into mediation.

This litigation is far from over, but consolidation would put more pressure on the state to back off its demands and/or cede some of what the tribes desire to move past the impasse. However, we don’t know for sure if it’s actually been the tribes that aren’t taking California’s calls.

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Derek Helling

Derek Helling is a lead writer for PlayUSA. Helling focuses on breaking news, including legislation and litigation in the gaming industry. He enjoys reading hundreds of pages of a gambling bill or lawsuit for his audience. Helling completed his journalism degree at the University of Iowa.

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