California Tribe Suffers Court Defeat Over Online Poker Ambitions

4

Earlier this month, a federal judge ordered the Iipay Nation of Santa Ysabel to shut down its online bingo platform that the tribe launched to test the waters before kicking off poker, according to court documents.

U.S. Southern District of California Judge Anthony Battaglia ruled that the tribe’s platform, which launched in 2014, violated the 2006 Unlawful Internet Gambling Enforcement Act. The state of California, which has for about a decade been flirting with the idea of legalizing online poker, also pushed to shut down the Desert Bingo gambling website.

UIGEA banned some payment processing for online gambling sites. The law was used against the major offshore poker sites in the 2011 Black Friday indictments, and before that was partially responsible for slowing the growth of poker in the years after it was enacted.

The problem with the tribe’s business was that it was offering online gambling to those off its reservation land, according to California.

The states of Nevada, Delaware and New Jersey have regulated online casino games for those within their respective borders, though Nevada and Delaware do share liquidity for online poker. Those states were given the green light thanks to a re-interpretation of the 1961 Wire Act, another law that has been applied to online gaming sites.

The Iipay Nation of Santa Ysabel could appeal the federal court ruling.

The silver lining for the tribe is that the federal judge tossed out California’s lawsuit, which claimed that the online gaming site was in violation of their gaming compact. That gives the tribe a good reason to appeal the ruling pertaining to UIGEA and make another play at web poker in the future.

California tribal gaming generates nearly $8 billion a year in economic activity and is the largest market of its kind in America. The size and complexity of California’s tribal gaming market has led to a lack of consensus on how to regulate online poker sites.

SHARE