Posted on: December 27, 2024, 12:21h.

Last updated on: December 27, 2024, 12:44h.

In a remarkable display of political retribution, California cardrooms allocated over $3 million this year to penalize lawmakers who backed a bill permitting tribal casinos in the state to file suits against them for offering illegal card games. Senate Bill 549, also known as the Tribal Nations Access to Justice Act, was approved by Gov. Gavin Newsom (D) in September.

Three of the four legislators targeted by the cardrooms lost their reelection bids even though two were vacating their Assembly seats and running for nonlegislative positions that rarely deal with cardroom issues.

What is SB 549?

SB 549, which becomes law on January 1, allows tribes to ask judges to legally challenge whether cardrooms are allowed to operate blackjack, pai gow poker, and other table games. The tribes claim that California voters gave them exclusive rights to host those games. But, until the new law, they have been unable to sue cardrooms because tribes are sovereign governments.

The cardrooms also hire third-party companies, which must be state-licensed, to “shill” in the dealer spot because regular players don’t always want to act as the dealer. The tribes argue that these companies are the de facto “bank.”

Cardrooms insist that their games are legal, but worry the cost of court battles could bankrupt them. Cardroom advocacy group the California Gaming Association estimates that the bill could cost the industry around 32K jobs.

The new law could have even wider implications because city governments, some of whom receive nearly half their budgets from taxes on cardrooms, also worry that the measure could force budget cuts for police, firefighters, and other essential services.

The Targets

The targeted lawmakers included Fullerton Democratic Sen. Josh Newman, the bill’s lead author, who lost to Republican challenger Steven Choi by 6,075 votes of 458,615 cast. Cardrooms spent $900K on ads and mailers portraying Newman as tolerant toward crime and benefits for illegal immigrants, according to CalMatters.

Cardrooms spent $500K on ads attacking outgoing Assemblymember Evan Low (D) of Cupertino. Low, who had a cardroom in his district, lost the race for California’s 16th Congressional District to fellow Democrat Sam Liccardo.

And cardrooms spent $443K going after termed-out Assemblymember Brian Maienschein (D), who lost his bid for San Diego city attorney to fellow Democrat Heather Ferbert.

Only one candidate, Laurie Davies, survived the cardrooms’ vengeance. Despite the whopping $1.3 million they spent trying to align the Republican from Oceanside with “anti-choice radicals,” “MAGA extremists” and “Big Oil,” she won reelection against Democrat Chris Duncan.

But only by 3,870 votes out of 230,546 cast.

Cardrooms Can Play the Same Game

Tribes have long outspent cardrooms in state politics, donating more than $23.5 million to candidates in the past 10 years — many times what cardrooms spent. Indeed, Newsom himself received more than $7.1 million in donations from California tribes since he first ran for governor in 2017, whereas cardrooms gave only $252,400 to his committees during the same period.

Cardrooms clearly intended this spending spree to send a message to lawmakers, and it’s highly unlikely that message will be ignored.

Any time you have a group essentially announcing to the world that they are going to do vengeance spending, it does cause lawmakers to pay attention,” former Democratic Assemblymember Mike Gatto told CalMatters.

However, Newman told CalMatters that he sees no logic in the cardrooms spending money on races after losing a legislative fight.

“The question really is: If you shut the barn door after the horse is out, who are you really punishing?” he said.