State High Court Blocks Indian Gaming Measure

The California Supreme Court on Wednesday blocked Proposition 5, the Indian gaming initiative passed by voters last month, pending a decision on its constitutionality.

The court, meeting in closed session, temporarily blocked enforcement of the initiative in response to petitions filed by a labor union and by residents who live near Indian casinos. Proposition 5 probably will remain blocked for several months until the court holds a hearing and issues a written decision.

The measure, passed by 62.4% of the voters Nov. 3, authorized Indians to maintain and expand the Las Vegas-style casinos that some have operated for years without the state’s blessing. Nearly $100 million was spent for and against the initiative, the most ever in an American ballot measure campaign.

The court’s action puts on hold plans filed by more than 40 Indian tribes for the kind of expanded gambling allowed by Proposition 5. The initiative said the gaming plans would take effect Dec. 4 whether or not the governor approved. Gov. Pete Wilson has refused to sign them.

But some tribes may continue with their gambling proposals despite Wednesday’s court order, attorneys and tribal leaders said.

Henry Duro, chairman of the San Manuel tribe in the San Bernardino area, predicted that the court’s action would not alter casino operations. “Nothing has changed at this point,” he said. “We’re talking with lawyers and looking forward to January, when we can negotiate with a new governor.”

Richard McCracken, an attorney for a labor union opposed to Proposition 5, said tribes should discontinue any Nevada-style gaming or plans to provide it until the Supreme Court issues a final decision.

“They should stop, but whether they will is a question,” he said.

Wilson lauded the court’s action and accused Proposition 5 supporters of mounting one of the “most deceptive advertising campaigns in modern California history.”

Without the court action, he said, “within only two days this state would have begun its transformation into a Nevada-by-the-sea, populated with dozens of new Las Vegas-style casinos.”

In the absence of Proposition 5, Gov.-elect Gray Davis, who will take office next month, could reopen talks with tribes over the size of their casinos and deal with such issues as whether unions can organize workers at the operations.

The state high court acted on two petitions. One was filed by four individuals, including a man whose property is next to a reservation, and a business that planned to set up a card club. Nevada hotels and casinos are helping to pay for the litigation.

That petition argues that the initiative violates a state constitutional provision against Nevada- and New Jersey-style casino gambling and is preempted by federal law.

Wednesday’s court order “demonstrates that the court takes seriously the arguments we presented,” said Los Angeles attorney Wayne Smith, one of the lawyers representing Proposition 5’s opponents. Although the court could take several months to decide the case, Smith predicted that it will “move fairly promptly because these are important issues.”

The other petition, filed by Hotel Employees and Restaurant Employees International, says Proposition 5 conflicts with a federal law that limits Indian gaming to forms of gambling allowed for non-Indians in the state. The document also argues that the initiative deprives the governor of his constitutional powers to act as chief executive.

McCracken, who represents the union before the court, expressed optimism that the initiative will be declared unconstitutional.

“I don’t think they would have stayed it if they thought it was constitutional,” he said. He added that his group filed the petition to protect 2,500 card club workers whose employers are threatened by competition from Indian casinos.

Eleven tribes already have signed agreements with Wilson that specify the conditions for their casinos. They relate to financial management, employee and customer protections, environmental conditions, and the number and kind of gambling machines that the casinos can operate. They will not be affected by the Supreme Court’s order.

Tribes that pushed for passage of Proposition 5 lamented the court’s action and predicted that the initiative would be upheld eventually.

“It’s disappointing news, but we’re confident that in the end we’ll all look back at this and wonder what all the fuss was about,” said Mark Nichols, chief executive officer of the Cabazon band of Mission Indians in Indio. “We had an overwhelming mandate by the population of California. This proposition is good for the state, good for the economy.”

Nichols said supporters of Proposition 5 expect state Atty. Gen.-elect Bill Lockyer to “aggressively defend this measure, as is his constitutional duty.”

The state court’s action complicates lawsuits by U.S. attorneys pending in federal courts across California. The U.S. attorney’s office in Los Angeles has won a District Court order directing tribes in the Palm Springs area to turn off slot machines and shut casino operations that don’t comply with state law.

The tribes have appealed to the U.S. 9th Circuit Court of Appeals, which blocked the lower court order from taking effect Wednesday. Lawyers for the federal government and Indians are expected to file more papers next week.

U.S. Atty. Nora Manella in Los Angeles has not decided whether to proceed with efforts to shut the casinos, said her spokesman, Thom Mrozek. The federal government could wait for the state court to resolve the legal issues or move ahead in U.S. court.

The state Supreme Court asked supporters of the initiative to respond to the opponents by Jan. 4 and gave opponents 20 days from then to file their reply. All of the justices except Marvin Baxter, who did not participate in the arguments, signed the order.