Card Rooms Challenge State Agreement on Indian Gambling

Saying the state’s recently approved Indian gambling measure violates the U.S. Constitution, four Northern California card clubs are urging Interior Secretary Bruce Babbitt to reject the state-tribal agreements permitting expanded Indian casinos.

The card rooms’ action is a likely first step toward a lawsuit to have Proposition 1A declared invalid on the grounds that it gives an unfair advantage to Indian tribes.

The compacts were signed by Gov. Gray Davis and 58 California tribes last year in anticipation of the approval in March of Proposition 1A, the amendment to the state Constitution that grants California tribes the exclusive right to operate Nevada-style slot machines and banked card games.

But attorney James Hamilton, on behalf of the card clubs and two Sacramento-area charities, contends in a letter to Babbitt that the measure violates the 14th Amendment guarantee of equal protection because the hugely popular ballot measure gives preferential treatment to a particular race--Native Americans.

The card rooms challenging the compacts are in the Bay Area, near San Pablo, where the Lytton Band of Pomo Indians hopes to buy an existing card room and install slot machines. Nearby card rooms fear being forced out of business if the tribe succeeds.

With tribes by far the most powerful players in California gambling, most card rooms, which by law cannot offer Nevada-type gambling, hope simply to survive. Tribes, in turn, are wary of card rooms’ winning state approval to operate card games like those in Indian casinos. Tribal leaders quickly dismissed the card rooms’ claim that the Indians are illegally receiving preferential treatment, saying that the tribes are governmental bodies rather than racial groups and can legally sign compacts with the state.

Rex Hackler, a spokesman for Babbitt’s Bureau of Indian Affairs, said, “It’s an interesting argument, and it has popped up every once in a while after Congress passed the Indian Gaming Regulatory Act in 1988.

“But the race theory doesn’t work,” he added.

The Interior Department has until May 6 to take action on the compacts signed by Davis and the tribes last November. If Babbitt and Kevin Gover, the assistant secretary for Indian affairs, neither sign nor reject the compacts by that date, they will become law.

In his letter to Babbitt, attorney Hamilton, of Swidler, Berlin, Shereff & Friedman in Washington, said the U.S. Supreme Court has held that “all laws that classify citizens on the basis of race . . . are constitutionally suspect and must be strictly scrutinized.”

He further noted that federal laws on Indian gambling give tribes the right to conduct Nevada-style gambling only if the state permits that level of gambling for itself or other entities in the state.

Because Proposition 1A authorized an exception on Nevada-style gambling for California’s tribes, such preferential treatment violates not only the U.S. Constitution but federal Indian gambling laws as well, he wrote.

Hamilton declined to discuss the letter or to speculate on whether--as the letter hints--a federal lawsuit might follow. The letter makes reference to the federal 9th Circuit Court of Appeals “where litigation, if necessary, would occur.”

George Forman, an attorney who represents several tribes, said the U.S. Supreme Court “on many occasions has held that the relationship between the United States and Indian tribes is not based on a racial classification, but on a government-to-government relationship” that is specifically spelled out in the Constitution.

“Throughout the country,” Forman said, “there are compacts that give tribes the exclusive rights to certain forms of gaming, with Interior Department’s approval.”

Tribal Chairman Richard Milanovich of the Agua Caliente Indians in Palm Springs said Hamilton’s arguments “cause me consternation, but no fear.”

“Maybe as tribes, we’ve not effectively espoused the fact that we are tribal governments, sovereign people, with peculiar rights granted us by the federal Constitution and upheld by the U.S. Supreme Court,” he said.

Hamilton said his clients include four card clubs--Artichoke Joe’s in San Bruno, California Grand Casino in Pacheco, Lucky Chances in Colma and the Oaks in Emeryville--and two charities--the Fairfield Youth Foundation and Sacramento Consolidated Charities.

Some other card clubs, including the Commerce Club in Los Angeles County, are not opposing implementation of Proposition 1A.

“We, frankly, would like to coexist with the Indian casinos, rather than become embroiled in litigation,” said Commerce Club lobbyist Rodney Blonien.

A 1999 state Supreme Court decision held that card rooms in the state already operate too much like Nevada-style gambling. The industry is pushing legislation to guarantee the continuing right to operate their games.

The bill’s author, Assemblyman Herb Wesson (D-Culver City), said he is paring back the bill, AB 1416, to avoid opposition from tribes and others. The Northern California card rooms’ action could undermine that effort, he said.

“I’m really disappointed that this happened when we are trying to bring people together and carve out turf so everyone can coexist,” Wesson said.

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Gorman reported from Riverside and Morain from Sacramento.